Full text of Commercial and Financial Chronicle : March 13, 1958, Vol. 187, No. 5724

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u:vi

TELEVISION AND ELECTRONICS INDUSTRY FEATURED TODAY

Volume 187

Number 5724

New York

7, N. Y., Thursday, March 13, 1958

thrice 50 Cents

Copy

EDITORIAL

l,
j The resignation of
Federal

one

The Business Outlook—

See It

Why Economists Disagree

Communications

who

Commission

Bankers Trust's chief economist

phase oif

bitter, not alto¬

gether non-partisan, inquiry into.the ethics, not

tp say the misconduct, of the members of the sq-^
called

independent agencies of the Federal Gov-

Crnment.

whether

one

ficient to put an end to
vill tell.'There
the

can

be little

which would discredit the

really

'doubt

that-each of

other, but of

not

course,

telling in "advance whose

going to be gored.

•

The

Far from having ran its; course, Mr. Cooley's analysis of
what he terms a "slumbering giant"' holds that television's entertainment half ' (mannfactnriiig, broadcasting

since

news

least

one

the turn
the

makliig

of investigation and corrective action

to be effected and. without delay. It may
well be that members of Congress, too, would in
some instances have red faces if all the facts were
wore

of labor leaders and some, business executives.

groups^ hre found in all walks of life

in this

country, and there is no unwritten law
which places government servants above and be¬
on

page

has
had

For

time, investors and many of those who ad¬
on the disposition of their assets have
on the television phase of the broad
and otherwise dynamic electronics.
'
^
j
industry. They have adopted an at¬
titude, superficially justified per¬
haps, that television has about- run

vise

some

investors

closed their books

its

course.

;

I won't argue with the fact

that,:
there
heart,
raise the hopes, or fill the pocket-

in the
has

past two

been

little

years at least,
to warm the.

of the investor in thei opera¬

book

industry. And
that immediate,
near-term
factors
certainly have
militated against any dominant posi¬
tions of the television
I am frank to admit

Continued

yond being approached—as there have been in
Continued

year

that

but also among businessmen are as
divergent as eyer.
In fact, rarely
have competent observer^ differed
Roy L. Reierson
so
widely concerning the outlook.
Opinions range from confidence in
/
imminent recovery to concern over the possibility of a
sustained depression*
Perhaps this is not altogether

fully revealed. So, quite possibly, would a number

of the

uncertaihties

downturn was ip thev
whether the sag was
merely, a pause along the >oad. Now,
this issue is no longer in doubt; it, is
generally agreed that < the American
economy is in a full-fledged recession.
Regarding the extent and duration
of the recession, however, and the :
prospects
for
a
renewed
upturn,
opinions not only among economists

good of his countryiat hCart is likely
"lightly ;or to wish to have
official misconduct condone^ or ignored. If half
of what^ one hears is true there is plenty of room
for reform.. It would be a gobd thing if a vigorous

and servicing) is like a capped oil well whose lid may
blow off tomorrow, and that the scope of the other fcalf

tual business

with the

''Pressure

business

tion

of the ,so-called

stocks

companies.
The* surface
William H. Cool.y
picture,
also, is not today any
brighter than it was a year ago,
nor are the short-term prospects much more attractive
investment-wise.
Yet, a flat, one-dimension portrait,
such as that which current statistics delineate, is' a poor
„

page

the

television

•An address by

Mr. Reierson before the New York Chamber of
Commerce, New York City, March 6, 1958.

(industry, commerce and education) knows no limit nnd
barely begun. The TV fund official fmds today's ■
fewer manufacturers are in a stronger economic position !
than larger number in 1950 peak yonrj predicts minimum t
of 6-7 million: sets this t year; and sees dosed- circuit
j
doubling of 1957 sales over lfSl^shbild continue in ;
1958, amounting to fit million.

only

may

(

has

previously obscured the economic
picture. Until fairly recently, there
was sdme1 question whether an ac¬

t6; take ~thematter

program

spark the Upturn; and (4) housing ui 1958
exceed 1957 by a small margin.

resolved

The whole* matter is a very serious one, and no
one

Vice-President, Television-Electronics Fund, Inc.

decline

really I; is clear-cut evidence that the economy is approaching
the j facts are fully de^ ®/* downtrend. Banker believes: (1) current downscape goat wi)l he; suf"
.*° *>e.m0rf
l®ian
°®fV
the crusade, time only v
in^iohTfl^ATrnl
C t° u
*ii

major parties would like to uncover facts

there is

sees

Whether these inquires,Wili liow

Continue vigorously until

veloped,

President, Television Shares Management Corp.

possibly
ending sometime this year, although not necessarily in
the months immediately ahead, and opines "the odds are
against, a spiralling decline to depression- levels." In
jfexplainihg why> and^teirt 16 which; economists disa
gi*e, Dr. Reierson doubts efficacy of forecasts until there

Congressional investigations has doubtless
one

By WILLIAM H. COOLEY

Vice-President and Chief Economist
Bankers Trust Company, New York

had

been placed in a compromised position by recent

brought amend to

Of the Television lndustry

By ROY L. REIERSON*

of the members of the

Continued

page

PICTURES

IN THIS ISSUE—Candid photos taken at the Annual Mid-Winter Dinner of
the Investment Traders Association of Philadelphia appear in today's Pictorial Section.

State, Municipal
in!

\ jv.V :.V.

...

Slate and

STATE

MvftfcipaL

AND

4Mr

MUNICIPAL

jj Public Housing Agency

COPIES OF OUR

Securities
telephone:

and

D.&fiQTeriuwitt,:

BONDS

HAnover 2-3700

Bonds and Notes
ATOMIC ENERGY
REVIEW"

UNDERWRITERS

CHEMICAL

ARE NOW AVAILABLE

•vDEALERS

BROKERS'

CORN EXCHANGE

Burnham and Company
BOND DEPARTMENT

30 BROAD ST.,

Underivriter

•

N.Y

MEMBERS MEW YORK ANO

CABLE:

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Harris,Upham & C2

of new york

Members New York 8tock Exchange

AMERICAN STOCK EXCHANOEO

IS BROAD STREET, MEW YORK 5# N. Y.

•

DI4-1400

TlttTYP* NY I-2M2

120 BROADWAY, NEW YORK
Bond Dept.

Teletype:. NY 1-708.

Net Active

Distributor

Dealer

To Dealers,

Markets

T.L.Watson &Co.

Maintained

25 BROAD STREET
NEW YORK 4, N.
FIRST

g0UtkU>€4t COMPANY
•

PALLAS

1 i * ! i'.

■

BRIDGEPORT

"
•

•

PERTH AMBOY

buy "these

bank

for :;

rights

Private

Wires

Dominion Securities

Co,

Municipals

DIRECT WIRES TO MONTREAL AND TORONTO

Goodbody

Toronto, Montreal,. Winnipeg, Calgary,
Vancouver, Victoria and Halifax

CANADIAN DEPARTMENT

Teletype ny 1-2270

offer

Direct

Canadian Exchanges

Stock Exchange

which expire on June 10, at
the current market.
(

Commission Orders Executed On All

American

Chase Manhattan

California

Rights
1

SECURITIES

Members

THE

OF CANADA

New York Stock Exchange

■

THE ROYAL BANK

Banks and Brokers

CANADIAN

1832

34 offices from coast to coast

ESTABLISHED

ON REQUEST

the first national city mnk

BANK

BOND DEPARTMENT

Corporation

Municipal Bond
Department

iBank of Antcrtr;t

'tMBERS NEW YORK STOCK EXCHANGE

115 BROADWAY
NEW VQRk

1 NORTH LA SALLE ST.
„

CHICAP0

Exchange Place, New York 5, N. Y.

Teletype NY,1-702-^

WHitehall 4-8161

300 MONTGOMERY STREET
SAN FRANCISCO 20,

CALIFORNIA

The Commercial and Firuincial Chronicle

Thursday, March 13, 1958

(1146)

The

Brokers, Dealers only

For Banks,

This

Security I Like. Best

Forum

Week's

Participants and

Alabama &

Their Selections

different group of expertsfield from all sections of the country

A continuous forum in which, each week, a

Try "HANSEATIC"

In the investment and advisory

participate and give their reasons for favoring

Our experienced trading

Louisiana Securities

Yuba Consolidated

particular security.

Charles

—

Industries, lira*:
Jank, President,

department offers

they to be regarded,

are

Frank Knowlton & Co., Oakland,

intended to be, nor
offer to sell the securities discussed.).

as an

are not

Calif.

(

broad

Contacts through

„

pur

In these days

of dark clouds on

the industrial horizon, the security
I like best must first of all have

you're gelling
possible coverage,
"Try HANSEATIC."

behind it
least
sion

depression-proof or at

But
going wholly

this

company.

| New York Hanseatic

sive

Corporation

Teletype NY 1-40

EOSTON

CHICAGO

•

PHILADELPHIA

SAN FRANCISCO

•

the

foresee

can

good

Charles

future
invest¬

American

120 BROADWAY,

I like best, is
example I

FNMA Common

clear-cut

Exchange}

States.

NEW YORK 5

since recovered over

TEL. REctor 2-781S

and

gages. The
function
of
FNMA is sim-

Products, Inc.

dividends

'Gold

years.

ilar

earnings alone are now at a rate

Bank of Virginia

sufficient

Alabama-Tennessee Natural
>Gas Company

Yuba

pay

Colony Life Insurance Co.

Scott, Horner & Co.
Lynchburg, Va.
LD 33

Tele. LY 62

for our Monthly Stock
Digest, and our other reports
that give you a pretty clear
picture of the Japanese
economy as a whole.
%

Nomura Securities Co., Ltd.

I <1 Broadway, New York 6,N. Y.
orders

for

offer or solicitation

any

for

particular securities

Yonkers

Raceway

Alaska Oil & Mineral

Member

New

COMPANY
York

Security

Dealers

Association

165

BROADWAY

NEW YORK 6, N. Y.
Toip

WOrth 4-2540

Tel. NY 1-2545

vtii

Aircraft-Mi)

materially;

of the stock.

f.-i

•*

The recent downturn in interest

rates, sparked by the reduction of
the rediscount rate by the Federal
ReserveBoard,1' should
benefit
FNMA in the following ways:

The Study

.us

policy
terest

should

ji^s b^n j)i«pared :

pursuant to our

firm's

of continuing its inin ibis important and

23<£

munted
counted
counted

tor
for

road
an
an

\ymcn

outstanding^These savings Will: be v';
$33,022,914
reflected in future years due to
just over 330,000 shares.; the longer-term/debentures now

748in,„the,.

i—

$25 million

cluding

building

aDnreciable
appreciable

the

that

ac-

percentage

ac¬

counted for by earth moving and
With

machinery will increase.
all this strength
on the

defensive side, what room is

there
Company's weapons
of aggression? One answer is to
look at the growth record of the
last two years. Sales of the manu¬
facturing divisions in 1956 totaled
approximately $5 million. Through
acquisitions and through :step-ups
of
production
of
the
existing

left

the

for

oroperties, they
five

times

oarently

are

that

now

rate.

running
Nor

ap-

resting place near at
and. The company's backlog of
unfilled orders approximates $21
million, or close to a year's out¬
put at the current rate.
is a

Copies of comprehensive 57-page y

survey may
.

be obtained i;./

this office.

'7','

31st

report,'- iniv
in
common

talker« Sons
-^.founded 1SSS - v.;

•3

..7:v

Members Ned) York Stock Exchange
t 120

Broadway—New York 5, N. Y.

776-Face value of mortgagesis ap-.i of extreme weakness in the'mort-..:

nor-'proximately 5% higher than this.::gage market, .substantial profits;!"
norpor

tion, and as the highway program
is
geared up there seems little
doubt

investors.' ■ J

properties,
Q

mnininff

%- arnd ^istitutional

■

BERK

t M"1

^fof the

rate, derive their income
stock, or
largely
from
industries
which Borrowed funds consisted 6f de-' ^^hg1 issued by;;FNMA. -have little or nothing to fear from
bentures held by the public and v-k,(2) " With: a
rapidly.- growing!J'*
a change in the economic weather.
notes payable to the U. S. Treas- * demand fori mortgages, increased ■;
Of last year's manufacturing in¬
ury totaling $1,396,152,206. Assets sales
may
be
expected r from
come, 47% came from sales to the consisted almost
entirely of VA FNMA's large portfolio. Since this :
public utility industry and 30% and FHA
mortgages at $1,561,346,-J was accumulated during a* period
from petrochemicals.
Of the re-

Bought, Sold, Quoted

leu?J-

grossing at

now

•

Consoli¬

year

Telephone: BOwling Green 0-0187

ifbls Is not

demand It hgs

Graphically stated, the Secon- may be forthcoming.
- v;5?- V :dary Market Operations were in- :(3)
As
private
demand [ for stituted to support the FHA and;
mortgages grows,"--FNMA's pur- '
VA
mortgage market much as, chasing activities" should
abate,
farm price supports were insti- thus
"
reducing the flow of FNMA v
tuted to support food prices. Un¬ stock to the market and
relieving"
like produce,
don't rot; on

mon

produce

then

however, mortgages
the contrary, they
secured income
ranging from 4^2 to 5%%. Since
the fees collected by FNMA off¬
a

well

set, to a large extent, the fees and
expenses paid by it, FNMA makes
money
in two major ways; by
keeping the excess of interest re¬
ceived

(on mortgages held) over
interest paid
(on debentures is-

sued); and by realization of
chase discounts

which

discounts

pur-

mortgages held,
in

some

the

selling
stock.
be

pressure

the

com¬

Retained earnings can
to retire the par¬

a
to

much

ticipating preferred, thus increas¬
ing the equity of the common
stock.

Despite the bullish implications
of

the

above

factors,

the

stock

(traded in the Over-the-Counter
Market) is still available at less
than

times

the

$5.60

simpler level,

suppose

N. Q. B.
OVER-THE-COUNTER

annual

earnings rate of the latest quarter,
and

little

than

half

cases

10%.

'SAV IRG1^

used

book

value

at
$104.99, a figure which excludes,
I unrealized
purchase
discounts
were
buy an insured $10,000,
amounting to about $45 additional
Within recent weeks, Yuba has 4%% mortgage for
$9,500. I would
per share).
With a yield of over
branched out in the missile field have a current
yield of 5%. But
3% on the $.17 monthly dividend
with the acquisition of two comsuppose that I were able to bor¬
I feel that this security presents
oanies whose activities—design in row
$8,500 at 3%%, using the
an unusual combination of safety,
the case of one comoanv a^d oro- mortgage as
security. This would
duction in the case of the other— leave me with a net investment income and appreciation potential.amount to

plying information and rec- ••
ommendations to individual I

Write

>
V,

.growing industry .and of aup-

are

Peter Van Osdol
(1) Interest rates on the»deben~ x
any mortgage
divi¬
tures held by the public,, by far
company; the
that
purchase and sale of mortgage the greatest .expepse pf sFNMA, pV
this will be the case for at least
J1 decade.
Se
Ca|e
±0r allowing
m
obligations with capital funds and
decline by-.an., average of ^
Even
another:
borrowed
funds. -Capital *1fundsIA least 1% during; 1958, based on -L;
refor an increase
increase in
in tho
the rost
cost of
of re
consist 0f proceeds from the sale the current market- prices for the
;
'covering, gold mining in the next of common stock to the public (as debentures. -"^Vithr issues totaling^
10 years should produce sufficient
described below), the sale of par- -.$1*465,000,000 currently outstandnet to cover present dividend rate.
ticipating preferred stock (to the;-.this would represent a sub-;
However, the company's defen¬
Secretary of the Treasury only), stantial --savings n to
the „ apsive strength does not rest wholly
and earned surplus. Capital and proximately, 1,250,000 shares^ofbl
lg
division,
ine
jwith its mining division. ; The surplus was carried at $181,960,- common and .preferred stock now -

[manufacturing

IN JAPAN

—

dend rate and indications are

Opportunities Unlimited

111 Broadway,N.Y.6 COrtlandt 7-5680

dated Industries' 36c annual

•

First

?v.

contributed to what appears to be-,.
a
conservative market valuation

function

Secondary*; Market

^limited

the

Investment Bankers

never

relatively small amount
outstanding and the newness of

mort¬

predecessor paid its first divi¬
in 1906 and there has been

Brokers &

'stantly -increasing:'" supply.*- andyp-

guaran¬

interruption in the continuity

dend

•■■■;y >

Tokyo, Japan

lijpt adequately aware of the situaJtiofrv !;This combination:; of con -

market-

teed

York, Inc.

Yamaichi Securities Co., Ltd.

for

The

Air Control

of New

Opera¬
tions, investors are,„orr the whole, >V

In doing so, incidentally, l:'ability of FHA
it has moved four times as much insured and

yardage of earth as was removed
in
building the Panama Canal.

A-

'r:;. • <Affiliate of

such

has'

write

the;

the"

the
purpose of improving the

in gold.

Trading Markets

for

demand

stock

Securities Company

institutions,-this
Because
been," and: by
present law' cannot be, a public
offering of this stock, and because

acted to
create this en¬

1905, it has;
$152 million

Founded

there

gress

tity

sells

stock is: normally sojfl.

government controlled institution
was
created in 1954 when .Con-

min¬
United

the

operations

ing

trade
.

•

Since cashTis The

gage.

Stock
-v

Call

2% of the face value of the mort¬

unique opportunity for private investors to own stock in a

ently profitable placer gold

STOCKS

similar inmortgage
to
FNMA, it must buy FNMA stock,'
at $100 per share, equivalent to

The

company's

JAPANESE

company, or

• stitution

VAN OSDOL

company

the defensive.

Market.

Campbell, McCarty & Co., Detroit
Members: Detroit Stock Exchange

which is on
offensive at the same time it
of

The stock; ;is mortgage

Over-Counter

PETER

predecessor,
Yuba
Consolidated Gold Fields,
has been for half a century one of
the most successful and consist¬

Stock Exchange

Stock

most

The

Members

York

the security

the

|fcpONNELL&fO.
New

Inc.,
know

Since 1917

security I like best

improve.

the eco¬

Industries,

Consolidated

Yuba

SCRIP

good. But now sup¬
pose you were able to purchase
my $1,000 net investment for $600.
This, in effect, is what one does

Yamaichi

front.

nomic

•

bad times that may lie ahead, ' size and safety difficult to match,
and, in all probability, continua- - There is a good explanation for
tion of rapid growth if conditions this opportunity.
When a bank,

begin

Jartk

branch offices

For current informatioa

traded

ment, come what may on

RIGHTS

profit.

So far,

any

for my

Specialists in

to my

680 in 1957, and

weap-

ons

our

would be added

fensive

has an

other, then I

Principal Cities

Private Wires to

but

330

from

which eventually

of of¬

one

Mobile, Ala.
Direct wires to

arsenal

hand

Broadway, New York 5

120

WOrth 4-2300

New Orleans, La. - Birmingham, Ala

earnings^$500 discount pn the mortgage,

anything

rose

N. Y.

NY 1-1557

HAnover 2-0700

$475,

yields better than 6% at its. cur- when one purchases FNMA stock.,
rent price of about 5%, offers Even if one deducts the Federal
investors a promise of satisfactory 'income tax: equivalent paid by
if not increasing earnings during FNMA, the profit potential is of a

shield

Exchange

Stock

They
1956 to

Hence, the

defensive

Member

Associate

with

company

19 Rector St., New York 9,

management has announced its de¬
termination to exceed $1 in 1958.

enough. If the

Established 1920

American

not

can
can

year

Members American Stock Exchange

leaving $177.50, I
would have a net current yield of
17%%. This does not include my

1958, it is

Yuba's

how

see

advance.

defen¬

the

York Stock Exchange

Members New

should

recession

the

Even
hard

Steiner, Rouse & Co.

come

last through the rest of

resistant

Of $1,000, and with interest costs
almost all aspects of mis-" °f $297.50 deducted from my in-

compass

depres¬

research, de¬

sne work,

sure

the Widest

the

and
other
facilities
possessed by Yuba prior to these
acquisitions, the new properties
should enable the Company to en-;

«?L .#*-4

Bought—Sold—Quoted

Campbell, McCarty,
Inc., Detroit, Mich. (Page 2)
Osdol,

velopment

Yuba Consolidated Industries, Jnc* v

nation¬

wide wire system.
To make

Combined with

other.

each

complement

aptly

JANK

President, Frank Knowlton & Co.,
;
Oakland, Calif.

range

CIIARLES

-'T 'i

(Page 2)

FNMA Common Stock—Peter Van

Trigger-quick service and
reaches

■

(The articles contained in this fornm

(last

reported

19-Year Performance of
35 Industrial Stocks
FOLDER ON REQUEST

National Quotation Burean
Incorporated

46 Front Strwf

Wow York

4.N.V

Volume 187

Number 5724

The Commercial and Financial Chronicle

...

(ll|7)k 3

INDEX

:
; '•

By DR. ELMER W. ENGSTROM*
Senior Executive

■>i

Vice-President

■;

-•

top

of varied scientific; and technical

to teams

\ H-

*tuiekentng

of—and

pace

skills, and

future is
^difficult "
T,h

the which they impose upon us.'

worthy subject, but

Impact of -Eoanomic Readjustment
•;: Policies—Marcus Nadler

one.

;

e s»e ;n

:of

become purely;
/a.ife laJtivp, ;^ov
rapid: is

the

ironic? d-eyel-f,

that:
has broken all #

economy

Engstr«m

iurgy.

and services were slightly
$1% .billion. Last year, only
h decade 'later, the total had risen
approximately $11 billion, carjying electronics upward to fifth
place amoilg all American induspets

;

Automation:
—Malcolm

More Productive Economy

Ferguson

£;
"

•

„

contemnlate the aston-

We mav

Ashing growth record of the elec:ftrphics industry during the past
4en years with a certain amount of

acteristics

J.F.ReiIly&Co.,Inc
Members Salt "Lake City Stock Exch.
Spokane Stock Exchange

Paid-Television Test Left Up to Congress.-

—_

conditions ^
Xer cateeoriS

Sintering Meeting, Boston, Mass.

complex,

comprise

• •-

'X>'

ri^ls

emnlov

rare

■

As We See It

Bought—Sold—Quoted
24
31

mav

Dealer-Broker Investment

and

Indications of Current Business Activity

Mutu^Funds

News About Banks and Bankers-—

range

times

Direct Wires to

Philadelphia

Los Angelaa

Chicago

Dallas

From Washington -Ahead of the News-^Carlisle Bargeron____ 11

Observations—A, Wilfred lVIay__^

**■* '*
'

£Jele '
% any

Teletype NY 1-1825 & 1-4844

Recommendations

Our Beporter on Governments.

Electronically-Active Materials

recently, all of OUr apparatus and
Continued

^ -

page

Public Utility Securities.

Railroad Securities

Securities Now in Registration

•'

Prospective Security Offerings—

General Minerals

49
41

The Market... and You—By Wallace Streete—

The Security I Like Best

The State of Trade and Industry

Washington and You

25 Park

Twice

Weekly

•

Chicago

•

Glens Falls•* ;

Schenectady

•

Worcester

Patent Office

Reentered

Sabre-Pinon

second-class matter Febru¬

25, 1942, at the
yoik, xm. x., uuaer uw

post

office

aci ox

marcn a,

New
ib'/b

DANA COMPANY, .Publishers

Place, New York 7, N. Y.

March

Thursday,

13,

Subscription

9576 '

WILLIAM DANA SEIBERT, President

Other

Countries,
,

vertising issue)
plete statistical

(general'news and ad¬
and every Monday (com¬
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1958

Every Thursday

state

Company

HERBERT D. SEIBERT, Editor. & Publisher

ST., NEW YORK 4, N. Y.

TELETYPE NY 1-5

U. S.

REctor 2-9570 to

•

United Western Minerals

Quinta Corp.

•

TELEPHONE HAnover 24300

Alaska Oil & Mineral

-T

ary

Members New York Stock Exchange

Lithium Corp.

Securities Salesman's Corner

Reg.

Spencer Trask & Co,

i__

Our Reporter's Report———

electronically-active mate-

The
.

IMC.

HA 2-9000 40 Exchange PI., N. Y.

Coming Events in the Investment Field-

Einzig: .'Klpld Scare" in 1958—

&Mackie,

—

Businessman's Bookshelf

mate---

fabrication

nrke3 that

Singer# Bean

Banks and Insurance Stocks

FINANCIAL CHRONICLE

V'.

Cover

(Editorial)

The ^COMMERCIAL and

•

Regular Features

.■

the

eiements
of

Stin^ S

man-pr^ed sub-

^new

Boston

Teletype: SU 1SS

0>L

Correcting Educational Faults—Roger W. Babson

WILLIAM B.

Nashville ;

Exchange PI., Salt Lake City

DAvis 8-8786

BOLSA CHICA

specialized in

"Albany

Teletype: \JCY 1160

Developments in Employee Trusts and the Matter of Earnings
—Cecil ;P. Bronston__-__L___-___
26

For many years we

HEnderson 4-8504

Illness of and Cure for the Railroad Industry—J. M. Symes___ 20

Published

25 BROAD

'.1

•

"Wl

ipeering, and in ;the ever-quicken- rials are just now coming into .gensing pace of research. My purpose era! use and will soon dominate
is to examine briefly the nature the eleetronics scene. Until yery
address h.y Dr. Engstrom before,
^-Northeast Electronics, Research and En-

]

.^Exchange PIrf Jersey City

unexploited or new materials of,

The -keys; to our future will be
found in new materials, in the

have

DIgby 4--4970

*An

•

temperature

high

levels.
A third category includes.the
large number of radioactive isotopes and materials whose properties can be altered basically by
nuclear -radiation. In a fourth
category are scores of previously

■

...

USS3S- gjife; are worth
and engineering.
jgrowing -concept of systems engi-

S'S

;

plasties'

■

either technically or economically. S
The new materials can be di^
Finding an Attractive Place for Small Commercial Farmer
vided into' several principal cater
—Kenneth E. Bouldmg—
12
gories. The first comprises a large
Feasibility of Atomic Bower Plants Here and Abroad
and growing family of solid sub—Robert A. Gilbert16
stances within which we can con-

many

Jbrought with it new. and funda'.mental problems relating to/our
Responsibilities ' for
the
future.
These problems arise from major

i 1.

Outlook dor ElepJronics^Robert S. BelV———

SABRE-PINON CORP.

;;

^growth has been the extension of many lesser-known elements and
electronic techniques into an ever* new5 compounds capable of With- - Arthur P. Burns' View's Challenged by ivalter E. Spahr for
broadening range of applications standing extremely high tempera-{ / "Implications and Contradictions"
4U commerce and industry, in de- tures or of exhibiting useful chartTpturn in New Orders Detected by Purchasing Agents-—1___

•

MANUFACTURING

Outlook for Electrouics Industry—Robert C. Sprague_____ 25

history

MINERALS

Electronics in Ten Years .Will Replace the Auto Industry
as Nation's Economic Pulse-^H. L. Hoffman—
22

•

the action of . electrons to
..eight-fold increase dur- achieve a variety of novel effects,
ing a period in which our gross These are conveniently called
Rational product doubled.
;
electronically-active
solids. An'
The basis of this phenomenal other broad. grouping comprises

ah our

;

UNITED WESTERN

-1

Space Age—Andrew ,G. Haley_;

#en$e, and in the home. Our abilJtyjso to extend electronic techfciqiies has, in turn, been the di{ecf resutt-.of industrial research
%n4 -engineering where growth
find acceleration have no parallel

LITHIUM CORP.

_: 10

Andustry's Rrtturer--H. Brainard Eancher______^

•

|ries in .business volume. This is trol

pearly

Bgker_^___^____:

Electronic Equipment Sales to Banking Industry .! —William
—i^
^. Damroth----

Tj;

|n the degree of its expansion. In and techniques that < were previ.1846, total sales of electronic prod- ously impossible of achievement,
Jpver

;

our;

our technology.'They have opened
Mustry as a whole has ■ been unique the way to new devices, systems
;.

Entertainment Electronic—Ira U. C0bleigh____"

Television and Big Business-r-Robert C. Tait—________ 13

have revolutionized

They

WHiteh^!14-6551

Semi-Oouductor Industry's Outlook and Electronic

(suit of recent and rapid advances
in physics, chemistry, and metal-

STREET, NEW YORK

GETCHELL MINES

Cover

Electronics Outlook for 1058—W. R. G.

Dr.

s, the
.electronics, in-

Television-Electronics {ndustry

The Commercial Implications of Missiles-Satellite-

:'
^
^, ;.;;
These new materials are ,the. re-..

"these" postwar

WALL

Telephone:

I order.

^*4 c o. r d s >for...
fiowth vim

jf-e-a- r

Glimpses Ahead for JSleetrpiiics—Elmer; W. Engstrom
:

variety of hew ma- >,
superseding$ the ; *

fabricated

\ •

•

—WilliamH, ~Coojeyi__-

are

materials

Overall Economic Strength of 4h^ Television Industry

;

sequence from Stone >
Age to Bronze Age to Iron Age;.;
has brought us now to the age of
raw

HAILE MINES

industry. The

??In a national

i all the products
upd processes of

•^pmeut today.

that

Happy Ending—-Cash

.pj

| older'f amiliar types in virtually

elec-

-pace

a ; growing

terials

Trust 'Investment

The 'Economic Outlook—A. W. Zelomek—

we haye udvanced into a'new agecharacterized by the availability v:

Villian-—Obsolete#

^ Withinvthe past quarter-eeBtury:, ; :.

Estate Taxes and Business' Mergers—Harold M. Somers—

it':,:

Materials for Tomorrow :

Setting—99 Wall

"What: Price National Strength'—David -Rockefeller-

; "vJ-r

term

fp r~

•

EAST SIDE STORY
5

The Fjiture ;pf Uraninm-^Floyd B. Odlum^

'9! The. present status of electronic of * these key developments, and '
idevelopment and the potential im-, then consider the requirements v.

pPOct of this development

jCover

Articles
,;

^^^

-"-Donald ^Gordon

accompanied, '.paradoxically, % ssetious problem of
depletion of basic knowledge, in moving from /-electronic I
data-processing systems of today to ^he automatic electronic y.
.factories and offices of iomor'OW, and in jnejeting Qur com-;
petitive. defense needs, Dr. Engstrom warns uncommitted:
basic research must 'be supported 'financially, and :calls on
Jindustry to itp its share and on Congress for .proper funding
of our National Science Foundation.- • *'".CvV"*•'

Reierson

Pppblems Bndangerjlng Canadian-American .Relations '

ever-'

: research ■;

!-:V

Overall, Long-Range 'Direction of American Business
—Lansing P. Shield

-environmental ^pressures

new

••

The Business Outlook: *Why Economists
Disagree

researcher briefly examines nature pf.vsuch■ key;
developments in electronics as revolutionary materials, switch;
•

•

■—Roy L.

RCA

■

•'Articles vnd New*

Radio Corporation of America
)

•

;■

Recortl — Monthl)
(Foreign Postage extra

-Quotation

year.

Note—-On account of the fluctuations

the rate of

exchange, remittances for for¬
eign Subscriptions and advertisements must
be made in New Yqrk funds.

■

BROADWAY, NEW YORK •
•

WHitehall 3-3960

Teletype NY 1-4040 & 4041

Direct Wires to

PHILADELPHIA

SALT LAKE CITY

Mr.

Abs

culties

Observations

By A. WILFRED MAY
TOWARD FOREIGN AID REALISM
In

matic

prag¬

well

ethical

Thia

ends.

credo

im-

portantly
highlighted in
the launching

Mike Mon-

roney's pro¬
posal for a

Aid devices?

according to provisions contained

ternational

Development, Association (also
dubbed "The Monroney Bank")
The Senator initiated his project

legislatively through a resolution
Senate

in the

introduced

endorsement

How to Get Off the

the

Give-Away Hook
The best way to

get the world

than

mere

aims,! of
course, form the crux of this type ~
of agreement; and here are some
of those proposed:
lofty

"off the hook" of the self-defeat¬

(1) Refusal to grant public or
ing give - away processes is by private loans to the State against
•building up sound international whom a decision has been given.
capital movements. The desired The same applies to the issue of
higher incomes and domestic sav¬ such loans in their capital mar¬
ings are thus generated. But fresh kets.
5 capital movements are obstructed
(2) Refusal of future govern¬
by political insecurity, the threat mental guarantees to cover politi¬
of expropriation or nationaliza¬ cal
risks
to
exporters and t in¬
i

giant Washington bi¬
partisan assemblage on behalf of
Foreign Aid.
:
On the premise that we must
"avoid the folly of rigid fixation
on
policies no longer effective,"
the proposal specifies the making
of development loans at rates of tion with inadequate or no com¬ vestors of the contracting parti.es
interest
lower
than -those
now
pensation, exchange restrictions, in connection with foreign invest-.
and
available; with repayment terms 'and fiscal and .other forms of dis¬ ments
exports
of
capital;
much longer- than those afforded crimination.,/;
/.,.:„///. gOOdS. -v-'v- .-<■<"
In these circumstances a new
by either the World Bank or our
(3)
Recommendations by the
Export-Import Bank, and with the proposal aiming at giving mutual governments of the contracting1 ■
privilege of remitting in soft local guarantees to foreign investment, parties to their private or public
currencies.
'
by Hermann J. Abs under the banks not to grant credit or loans
The evil in conceiving of the aegis of the International Insti¬ to
enterprise, desiring to effect
thus projected agency as a bank¬ tute of Banking Studies of Rotter¬ fresh investments in the territory
ing operation, or overlooking its dam is interesting and important. of the State against whom a deciv.
true role of another
give-away He transfers to the economic plane sion has been given.
/
/
•
device, far transcends the areas of ethical principles, reminding us
,(4) Recommendations by the •
mere definition, semantics, or even
that
economic development
is Governments of the ; contracting
of ordered Federal fiscal score- closely linked with the honoring parties to their private or publickeeping. Its proposed "soft-lend¬ of agreements; and proposes that banks in future credit and loan
ing" accommodations, together this necessity for the innate re¬ agreements
with
the* offending
with the politically motivated de¬ spect of contracts should be vali¬ State, to embody a clause to the
termination of its fiscal activities, dated by
a
solemn declaration. effect that the credits or'loans would inevitably lead to the un¬ Good
personal
behavior
must shall fall prematurely due in the
dermining
of
the
$3%
billion form the basis for economic activ¬ event of infractions of the con¬
World
Bank
by nullifying
the ity if the latter is to be geared vention; and
latter's valiant efforts to promote to considerations of productivity
(5) Revocation of any mostsound fiscal practice on the part rather than politics.
favored nation clauses which may
eve

the

countries

which

have

been

embodied
in
agree¬
The Report points out that the
governments of the young coun¬ ments with the offending state.
Such interference has already tries are making the error of try¬
Irrespective of whether these
been demonstrated via the com¬
ing to do in a few years what the proposals are workable, in whole
peting activities of the Export- West needed centuries of gradual or in part, they certainly repre¬
Import Bank. In Brazil, for exam¬ progress to achieve. They fail to sent an approach in the funda¬
ple, Ex-Imp's loose loans, which see what a very large amount of mentally right direction!
have been officially ascribed to labor as well as of financial and
political considerations, have en¬ technical effort the West needed
abled the country to foregh put¬
for this purpose, and they dp not
ting its economic hbusein order. realize that their economies are

operating.

Howard Calkins Pres.
-

...

Black's

Mr.

1954.

has

not

Brazil

with the local Olin Mathieson sub-

subsidiary being a capital invest¬
ment in a private enterprise by
the

far from

being efficient enough to
worthy of- any enable them to attain the same
money >. loans
since
early goal. Gazing in wonderment at the
(This week's transaction Soviet Union's progress, they shut

deemed
new

institution

International Finance Corpo¬

their
which

Moreover,

there

that

the

new

•

Of Albert Frank Agency
At

directors' meeting

follow¬
ing the annual meeting of stocka

that

crucial

process

„

Retail Trade

"'"CWmmodity Price Index
Food

Price

Index

Industry

Business Failures

Jj
A further effort was

made

Thursday of last week by the

Federal Reserve Board to assist business and industry in stemming
the tide of ouiywaning econpmy by its action in cutting the dis¬
count rate one-half point for New York, Chicago and Philadelphia

Federal

?/:

new-discount

Banks. >The

Reserve

2*4%.

/.V

rate

now

; Jv;;

stands

The above banks were leaders among Federal Reserve Banks

in cutting

the discount rate by. one-quarter point late last January.
of last November, when all. Reserve banks cut
half point, the discount rate at the New York, Chicago
and Philadelphia banks has now been trimmed H4 point.
,
Since the middle
the rate

This latest action widens still further the gap

in the discount
rate between the three big Federal Reserve Banks and the San
Francisco Federal Reserve Bank, which is the only one of the
still at the formerly prevailing 3%

Banks

Reserve

Federal

reduction

was

The

rate.

eight other Federal Reserve Banks are at 234%.

•

spokesman pointed out that the latest
order to keep the discount rate in line

Reserve
taken in

sharply descending short-term market interest rates,
such as those on 91-day Treasury bills, commercial ^aper and
bankers'acceptances.
'
' *, • //
with other

that the cut also

He also noted

signs of

decline in business.

taken

was

credit

make

comes

in the midst of further

The spokesman added the move

conditions

"still

favorable

tor

recovery."
to the country's employment situation, it is noted
unemployment benefits rose by 137,800 during

Turning
claims

that

for

the third week of

February to

total of 3,268,000, highest in 20

the United States Department of Labor reported.
by Federal-state job¬
less payments, officials noted that on the basis of latest reports
years,

Since many employees are not covered

there

doubt the total unemployment figure for February

was

would exceed 5,000,000;. / - 1 / * '
•"///'-:
The insured unemployment figure has been climbing sharply
fall and

last

since

represents 7.9%

now

of workers covered

It was the highest numerical total since the
program began in 1938.
V V" *
- ■
\
/
!
It was nearly double the 1,700,400 workers who applied for
benefits during the corresponding week a year ago. The 1957
figure represented 4.3% of those insured.
.
/ ' The increase was attributed to further cutbacks in metals,
machinery, electrical equipment and auto industries and to the
the

jobless payments.

effects of bad weather.

Department's bureau of employment security added that
of initial claims filed by newly laid off workers

The

the

number

dropped by 23,300 to 435,900 in the period ended March 1.- About
227,000 initial claims were filed for the same week in 1957.
Steel

men

are

cheered this week by an influx of orders from

lethargy of most big users,
Age," national metalworking weekly, reported on Wed¬
nesday last.
/
'
*/■ ":
'
;
./
• 1
The order pickup from the "little fellows," it added, is not
enough to save March from a steel production standpoint, but if
the trend continues, the accumulation of orders could be enough
to spark a significant production increase in April.
It further stated that without some help from automotive,
the railroads and appliances most steel men are resigned to an
unsettled market situation until mid-year. In fact, the consensus
small customers, but depressed by the

"The Iron

to-day is that a real groundswell is hardly likely to develop
third quarter.
.
.

until

Voicing an optimistic note, this trade weekly continued by
saying, the steel production rate to-day1 is closely keyed to
actuai business volume. Backlogs for most mills are a thing of
the past and user

inventories

are

low, so

improvement in the

business of steel customers could be reflected quickly

in the steel

ingot rate.

Detroit, the steel market picture changes from day to day,
mills are not quite sure where they stand.
Orders are
one day
and reinstated the next. Other tonnages may
set back, increased or decreased.
One steel executive describes the Detroit situation as akin
In

foreigners'

Carloading3

the

canceled

running

foot

race

while jumping up and down.

It is a lot of

work, but you do not seem to get anywhere.

Incentives to Expropriation

propriation

Production

Electric Output

Auto Production

and

great sacrifices
Russian people have
as
the price of their

to the

country's advance.

strong
"bank"

the

undergone

ration, and having nothing to do
with the Bank.)
likelihood

eyes

Steel

// /;

)

rather

..Sanctions

A. Wilfred Uir
-

•■•

of Trade

State

in the Convention.

to be

called the In-

1 "

Thursday, March 13, 1958

activities like the United

tional lending
agency,

:'V": The

Social

camouflaging

interna¬

new

from

Nations' remedying the financial or eco¬
nomic difficulties into which they
Projects Fund, or become
have run.
: /
/'./.,?■[;•:/'//.
a
wedge for our getting into a
"give-away device like"*:the pro¬
v Proposed Remedy
posed SUNFED by the back door.
To remedy all this, Mr. Abs under
/ The only way such undermining
the sponsorship of the Rotterdam
by the Monroney institution could
Institute offers a working plan, a
be prevented would be by keeping
"Convention for the Mutual Pro-1
it under the control of the World

diffi¬

either mis¬
guided economic policy or because
they have embarked on too many
projects within too short a time.
Rather than carry out effective
reforms, the countries take the line
of least resistance; and they start
by taking over or squeezing out
the
enterprises
controlled
by
foreigners, this in the hope of
arising

tection of Private Property Rights
But, as is already being
irt FCreign. Countries," in which
indicated by public comment, the
the " contracting / parties
would
! accompanying assurance of sound¬
Undertake to accord full protect;
ness would of itself be crucial in
tion to the property
rights and
preventing such control.
interests of the nationals of each
Isn't it high time to cease con¬
of the other contracting parties
fusing the public by

Senator

its

expand

point

some

reasons

economic

with

Bank.

of and interest

functions to embrace existing Aid

that

public discussion of Foreign Aid
policy be confined to the realities
—for

will

contribution of last week

our

advanced our conviction

the

that

states

rest

often

The Commercial and Financial Chronicle

(1148)

"The

ex¬

Iron Age"

established

assets,

says

than

challenge of automation.

that the steel job classification system
years ago is successfully meeting the

Talks with industry and labor leaders
sigificantly

indicate that the trend to automation in steel has not

upgraded or downgraded the average worker.
"In 1951," this metalworking weekly reported, "the average
steel worker's job rating was 8.02 and in 1955 it was 8.13.
The

Dixon Chemical & Research

gain

was

less than 2% and most of it came at the bottom of the

scale.

Northeast Metals Industries

"Another significant point:

Howard W. Calkins

holders of Albert Frank-Guenther
i

Bought

—

Sold

—

■

•

Quoted

Information

Law,

Inc.,

Chairman
I

on request

elected
late

Howard
of
J.

will

Calkins,

Board,
was
to succeed the

Reynolds.

also

continue

Mr.
as

Chairman of the Board.

ikaramt. Hurpijii & Co., Jnr.
50

BROAD STREET

Telephone WHiteftall 4-7361

NEW YORK

4, N. Y.

Teletype NY 1-2402

Ashton Adds
(Special to The Financial Chronicle)

DETROIT, Mich.

—

Charles H.

Buck has been added to the staff
of Ashton &

tion."

the

President

Frank

Calkins

W.-

The transition involved in a 14%

productivity gain was smooth. Between 1951 and 1955, only a
handful of job classification grievances required outside arbitra¬

Company, 15515 West

McNichols Road.

industry February new car sales established
units, "Ward's Automotive Reports"
Friday last, giving the auto industry a 250,000-unit
sales deficit in January-February compared with like 1957.
This trade paper said that despite an upturn in retail buying
In the automotive

53-month

disclosed

late in

the

increase

low

321,400

month, February sales could not stave off a further
dealer inventories, now crowding'the all-time high

of 890,000 units.
It added that

further curtailment of

factory production is in

prospect for March and April, pointing out that despite a cut

Continued

page

Volume 187

Number 5724

The Commercial and Financial Chronicle

...

(1149)

cqrity dealers

Over-All, Long-Range Direction
Of American Business
By LANSING P. SHIELD*

by Mr.: Shield, who finds that -

change has, for the most part;, cost
of« the world and

our

status quo is' decried

us our

•

ests into

moral

leadership to
.vand

"moral leadership ;

system is under fire both at home and'

ness.
•,

our

children.

welcome

yet devised

President and Chairman, Canadian; National Railway

;

Canadian-American: businessmen

ernmental action which is said often

all have

sell

butter

bonds

and

and about

steaks,

interest in the

a common

direction business is taking in this
country. I am
,
not

-referring

to the current
r-e

cession.

Possibly
much

has

bial

too

should

improved dur-1

for

moments

about

the

overall,

longdirec¬

range

/
difference

phies

P. Shield

Lansing

business.
is a

There

wide

;

business

the

philoso¬
just
all, business is

enterprise

in people. After

people.
We

have

the

group

holds

that

to the status quo, or is reasonably
satisfied with the existing state
of

things; and

then

there

thd

group that is receptive to change.
In

the first group are the mili¬

tant conservatives and the people
who just don't care. You might
say

the

they

are

wheels

their ancestors.

;

an relations* Cur*,
problems jeopardizing friendship' and goodwill cited by
Mr. Gordon include: (1) our tariff» against Canadian exports
which; paradoxically, originate ill the1 first place' from U. S.
investments; (2) inability; of Canadians to participate in
::f).
ownership and fill top management positions of U. S.bfanch
plants and subsidiaries ; (3) barriers erected against Cankdian
.

vjV--

:'h.

efforts to

pay for its adverse trade balance with us; and (4)
effect :©f' U.S. /agricultural u surplus and -trade policies on
Canadian agricultural sector.

down

that

road

lay
'

■■

riding backwards
of

progress

that

part
the moral leadership of the -world
and our system is under fire both
at home and abroad.

;

America

had: built

great

only view they get is to the
rear. They remind
me of the big
hunter's

game

had

heads

assistant.

beautiful
of

wild

His

trophy

room

animals

shot. Across the corridor
assistant's

smaller

where

had

rear

boss

reservoir of good will—a national

image in the eyes of other nations
In the second group
are
the that
pictured
America
as
the
builders and those who welcome
champion of individual freedom
change. A typical leader in this and of personal opportunity re¬
group might be described as a gardless of station or birth — a
'man with his feet on the ground
people with tremendous energy
and his head just far enough be¬ with an unselfish desire to
help
low
the
clouds
to
have
good nations less privileged. That was
visibility. The
leaders
of ; this 17 years ago. If Wendell Wilkie
group look squarely at the serious were alive and making mat same
weaknesses in our national struc¬
trip today, he would find that
ture—weaknesses that have risen reservoir
nearly empty—he would
primarily out of the rapid and be a disillusioned man.
accelerating world-wide changes
It is hard for us to realize that
in economic and social systems.
millions of people throughout the
They
recognize,
too, that
our world consider us allied with the
world position has been under¬ advocates and defenders of the
mined. They look upon our arma¬ status
quo, just at the time when
ments as merely a dam that is their
countries
are
undergoing
holding back the red tide—a dam great social and economic changes
in which we are frantically trying
and they are looking for leader¬
to plug the leaks with Jupiters
ship and help. In the meantime,
and Vanguards.
Russia and China exhibit a Com¬

mounted

had

was

trophy

of
the

room

all

the

ends.

But despite our
red

tide

uncommitted
not

armaments, this

continues

turn

flow

over

shall

countries.

with

back

missiles.

better
......

materially affect most of us
Included in the group of con¬ during our lifetimes because many
servatives
are
those
successful of us might not be considered in
younger
businessmen who have built their the
group.
Of
course,
a
point of view. Oliver
businesses on new ideas but are that's

allergic to them. From here
they want to sit tight and play
it safe. A new idea that might
alter their business philosophy is
in

♦From
a
talk
by Mr. Shield before
meeting of the New York Secu¬
rity Dealers Association, New York City,
March 7, 1958.

Annual

new

suc¬

Our Achilles heel is the national
we

present to our friends

shortcomings
casts

and

has

been

much

comfortable

truth

these
x

most

re¬

is
us

should

and

hasize

that I speak

only

pri¬

as a

here

shadow

home

doubt

and

the

value of our bequests to future
generations.
remarked, "Oh, to be 60 and
A; 4ew days ago, I received this
young again." Some one has said, letter from a
life-long friend, who
"Growing old is not so bad when is senior editor of one of the
you
consider
the
alternative." country's
leading
magazines. I
After all, to paraphrase General
quote in part, "I'm retiring and
MacArthur's statement, "Old segoing to Europe to live. I'm sick
of the way this country is going

foolish cowardice which keeps

from trusting them:

arid speak¬

This, then, is the text of my
paper, for between: us let it be
said that "rude truth" about our
common problems may be spoken.
Such speech bounded; always by
goodwill and understanding and
followed
by appropriate, action
should help us to resolve our dif¬

Nevertheless,
simple,
fact is, to me
the

here

vate citizen—

Donald

Gordon

ferences.

that relation¬

Completely Independent Canada

ships between our two countries

What

have deteriorated in recent years.

are

arisen
which must either be eliminated,
Points

cause

friction

have

points of
moving parts of
devices.
Unless ade¬

the

mechanical

quate arid effective lubrication is
provided
at points of friction,
disdainful
of their northern
valuable
machinery will
inevi¬
neighbor because of a miscon¬
tably break down or suffer seri¬
ceived notion that in some way
ous damage.
we are colonials. Most intelligent
In human relations, points of Americans- understand
that
friction demand the samd treat¬ Canada is completely independent

would

problem.

suggest

our

attempting to solve

problems, but it has

mutual

the

but

nation,

are

American press, or to hear

some

public representative of the

United States state

directly, or by
of
- to

that some, form
tribute is payable by Canada
the British Government. This,
course,

nonsense.

♦An address by Mr. Gordon before the
Pittsburgh Traffic Club, Pittsburgh, Pa.

Continued

page

All of this

stock having been sold, this advertisement appears
as a matter of record only.

element of truth in what

responsive chord in

Not

New Issue

of us.

I need not recount a

100,000 Shares

our

American

long list of
failings. They are

75,000 Shares

much

publicized. There are some,
however, that should be of special

Johns-Manville Corporation

interest and concern. *

Transamerica

Bequeathing Our Failures

Corporation

This

generation is bequeathing
some "major, unsolved weaknesses
in our business system. There is
the
failure
of
great
economic
groups to exercise
self-restraint
and
accept fully
their social
responsibility.

Common Stock

For

DeanWitter

example,

learned

how

have not yet

can

Dean Witter & Co*

subordinate

the selfish interests of individuals

groups to the common wel¬
fare. Asm result, pressure groups
and

7y 1958

are

able to Obtain

privileges and

Continued

page

often, seemed to me that we have proud 'member, of the British
a practice of critically
Commonwealth of Nations, end, a
examining our problems, and then mutual Sovereign provides the
speaking about them in realistic only formal link with tthe pepple
terms. You may recall that Emer- of the United
Kingdom. There is
not made

my intel¬
lectual friend's excessive
pessi¬
mism, but there is so much more

many

Canada is

drain and the misman¬

tion strikes

March

occasion

startled to read in

that implication,

there has been no lack in the use

of goodwill in

Canadians

he, says that I suspect the quota¬

issue

are

any

procedures and compromises mu¬
tually agreed upon. There do not
seem
to be many problems of a
purely political nature. It is true
that some Americans may be a bit

deal with

friction-in

There

territorial disputes be¬
tween
our
respective countries
that
cannot
be settled
through
longer

that

We all understand how impor¬
tant

relations?

ican

they will not
further trouble.
treated

are these problems which
endangering Canadian-Amer¬

agement of its affairs."
I can't go along with

' '

are

ways

ing to them rude truth."' v

ideas.

—

all

anything that
would injure
or destroy

at least

"Men

better
than they seem.
They like flat¬
tery for the 'moment; but they
know; the truth for their own. It

luctant to say

these

this connection end I quote:;
■

assumptions,; I

our

and

of record only.

erally

ment, in the sense that they quite
enemies often disappear if action, accom¬
piore
n urn erous
and more panied by the lubrication of good¬
will and understanding, follows
powerful.
This image is marred by our a
critical
examination
of
the

fewer

getting

Holmes, at 80, passed a
pretty girl on a Washington street

matter

relationships between son—-that eminent American ex¬
have been gen¬ ponent of- the worth of "the indi¬
good, and because there; vidual—had something to' say in

t^o countries

and enemies—and our friends are

than
Not

Orient

recent

Wendell

of this stock having been sold, this advertisement
appears as

the

which

prominently displayed
and tempting wares are offered.

down the

are

cesses

image
For the most part, the deteriora¬
tion of this country's position may
not

now

showcase

munist

and" Africa

Because
our
;

In 1941,

the

•

tooiate to arrange

We have lost for the most

■

tion of Ameri¬
can

that

safety. '

the

Wendell Wilkie, a busi¬
-time afford the armaments that ness man who looked beyond his
will protect us from oiir enemies. business, made a trip around the
world. When he ret u r n e d, he
_Some of us might settle for that
philosophy if we had any. assur¬ pointed out that, over the years,
ance

like to

discuss
few

first group's
"why change?''.
yielded most of
We can continue
business pattern
jin this country and at the same

Rather,

mother-in-law.

Adherents

said
that.

the prover¬

philosophy say
Our system has
jus a good living.
.with our present

already

been

b out

comes

rent

Whether
stocks

by Canadian rail

amicable settlement and prevent breakdown

•

ing \ the last. .25 years to. provide ;
security for the .indi vidual, better ;
opportunities for all races: and an
unbelievably high standard of lbv- •
ing. So far so good.-But'here are;
some contingent liabilities in this
legacy which may cause future,
generations to take a dim view of

advised

are

head to apprise themselves of current points of friction and to
undertake prudent actions themselves rather than await Gov¬

system'that has

Relations

By DONALD GORDON, C.M.G.*

social jsystem man has

and

been, modified nnd.

recreate ourformer favorable world image ~-v*

strong America for

Canadian-

is 7

group iuterr
'
objective to promote society's best Interest; ;v
business to exercise its prinuury respMsibiiity for ; ;

accustomed

reasonably assured, for us for the
of our years. On the other
hand, each of .us wants to. leave
'
as. a
legacy. to .his .children, a
strong America.. ::
The legacy "we shall bestow on
:
s uc cee d inggenerations-is'the *
greatest and. most equitable busi-,

a common

and calls

been

abroad." ~ The- super-market food chain head believes business
W? labor are bequeathing some major, unsolved "weaknesses 3v
our business
system; urges we resolve economic

•

have

rest

lack of receptiveness to J

our

Problems

/■.,

Stature

Our

Short. of ; a
sudden: nationalf
disaster, the way of life to which
we

President, The Grand Union Company

Affinity for domestic and international

die, they just.

never

trade;away.":f.>,.1
Losing

March 6.1918
»

►

I *

6 ,•

The Commercial and Financial Chronicle

(1150)

Entertainment Electronics
DR.

IRA

RCA, for 30

years a

maker

sets

U. COBLEIGII

traded

with

view of conditions in the TV and radio world

screen

with

inch

We have viewed

Whither TV?

that

set

weighs

but

with

pounds, is battery driven and

Cinderella

some

delight Peter Pan, Aladdin,
and
Disneyland; we
have seen squirming Apalachintype gangsters
and
dizzy
mobster's
on

the

volume

Kefauver

in¬

cates

molls

and

short
ries

memo¬

that

long

expense

Oxonian.

only

And

ago,

under

three

has

The

fortunate

snow.

are

people, indeed, to have

there's

course,
with
a

really

now

indicated dividend

delivered to

lessly, and

cost-

effortlessly by TV.

The next treat in store for
no

doubt,

arrival

is,
network view of the
Explorer II on the
us

Moon.

Television

-But
enough of this program
chatter. What about the sets? How

of them are there and is
making them a profitable busi¬
ness?
Well, there are some 40

the new!I

now

boast

151-j

million

(excluding
smaller

least

these

than

inches.

tage

"knot-holes"

targpts

for

replacement ^because

fare

—repair.)
In

1957

about

6,300,000
TV
(includ¬
ing color models) against 7,350,000
in
1956.
Radios, on the other
band, went ahead with set pro¬

fo.

radios
little

1957

one-third

over

saturated

market

there

sets,

spots.

ancl

above.
ket

First,

tired

second

ables,

with

inch

these

last

year

and

considerable

improvement in this type is ex¬
pert..ble. Motorola is reported to
have

developed

closed-circuit

light portable

are

power¬

sold

its

motor

"hare

process is
the increase. There

some

wonderfully

UNDERWRITERS

•

been

radios

but

getting

shows

also

Swahili

hillbilly
with

for

now

What

industry?

BROKERS

the

are

afield

you

„

—

J~~*

■:>

;

Members
New York Stock

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

LOS

ANGELES

v""

———-

Tomorrow

and'

.
r

1958
4

l..

a "ew

iecord '» 1957'

with $5 ? billion ^ 1956.,Further
growth is expected in 19o8.
Before World War II the radio

Association, which

turers

•

NEW

YORK

•

CHICAGO

Serving Investors

powerful

sented it, was composed of pro¬
ducers of radios for the home, of

around

simple

New

the-

transmitting and communication
equipment, and of their relatively

prior
to
It operates tele-'

WABD

global radio!

repre-

Corpo-

most

-industrymnd the Radio Manufac-

components..

Today

the

composed of manufacturers of a
wide * variety of complex equip-

sells

smallest,*

sales at the factory level ex-/
$7 billion as compared »

station WNEW in New York. The
stock

the

the^EIA^Markethi^Data

electronics industry and the Electronic Industries Association are

ment> systems, and parts including
companies whose primary interearning ests are in aircraft, office equip-

Over-the-Counter market, pays no
dividend and represents a speculation

power

music

the
:

the

its

future

stations

and

manufacturer

ment> automobiles, and specialized ;

two

publishing subsidiaries.
Laboratories, Inc. is

DuMont

weapons of war. All have a com"ion interest, however, in the development and perfection of new

and

sets

cathode-ray tubes, plus special
broadcasting equipment including

Magnavox
ALL-TRANSISTOR

applications of electronics,
This

the home
portion
of
the

entertaincameras, film scanners and mobile ment
industry's
apparatus. Sales have fluctuated dollar volume—that is, the nianuquite widely, running at about, facture of radio and TV sets and
$40
million
for
1957
against phonographs — represented only
r

million for 1953,v the peak
26.6% of •

priced

Pictures.

Here

speculation

American

year

of the total. Military
on the other hand,

is .constituted

about

hand!. Yet

Industrial

half.

electronic

the

products, which have
been steadily rising, accounted for

Ex-

18%.

„

•

final

statistic.

The

\ declined
Office

0«Research and Intelligence of

USIA

reports that there

143,330,500

radio

are

sets

now

sets

the U.

woids,

there
on

are

this

alone.
some

other

ai*^
in

300 million radios

planet that

excite

can

substantially,

the

other

fourth

Television
about

6 5

about 4%

but rather
the

expanded

Set

Sales

minion
below

1957

orbit,
'

Sing

exhort

or
.

pretzels

that locked in

moons

about

million

1958.

to eat

because

they

goodness!

:The

are

radio

the

return
The

once

one-

ordinary

ance

of peak

perform-

;

single battery. Su-

perb tone quality superior to

most conventional radios.

•

SEE and HEAR

MAGNAVOX

before you

buy

Come in today for a demonstration

remagnificent

acj navox
high fidelity cadio-phonograph

increase,

market

weighs only

were

placements market alone will ab-

homes

it"

$139-90
of

Sing'a°r,b
f™m three to iour miUio"
TV sets a year, and second set
have

powerful

much

1956> but the in_

dustry expects them to

—months

sales

receiver

tube operated short wave sets

segments- of

have

use.{in

rnnnfi?aiiHllSC
^tV^*
Canada
and l53 million
S.

that

industry
rapidly.

small,

puts the whole world at your

procurement,I

Stock

about 21%

is owned

common

Paramount

low

38 Officis

^ achieved

with accounts of man-inade
•

?...

Military procurement of electronics amotmted to about $3.5

the

circuit to Honolulu

FRANCISCO

•

&Co.

SAN

Military Electronics

change and sells at about 3%,
This does not mean that the" ra-;j;
three-quarters-of a point above its dio-TV1 business as a whole has

Dean Witter

Laboratories

is* listed

- -- - -

radiotelegraph

only 1957;it amounted to $900 million,

ceeded

l°w;

Private leased

the

division of Allen B.

stations

One

further

provide

York, WTTG in Washington and
KTLA in Los Angeles
plus radio

A'\
-

all-*

Department, the electronics mdus-

Broadcasting

was

vision

by
/

" '

v.—

eventually
and
spaceships— 135 million radios in use, the busiand of guided ness of selling replacement parts
missiles, elec- alone has become tremendous. In
< missiles,, eiec- -alone, has become tremendous.!, in

£utea&y the eia MaiKeting*Data

around 25

year.

■

earnings

spin-off in 1955.

can't get
consider

E.)

DuMont

investment

you

'i
,

}

sold,, and /a

were

nr.

manufacturing end of TV.

In: 1957

graps

b Record lGrowth

were

DuMont

who

* DISTRIBUTORS

{

•J

"hi-fi."

gain is expected in 1958.
With 47 million TV sets

^•.neWima^ets as;!W

fu„

RrnnX

ration

Brooklyn

some

Certainly

0EALEtf$

time record of five million phone*

satellites—and

eXD^d>th£se?services

m,;-^^^

$2.90, up from
$2.13 in 1956, Regular cash dividend is $1 and shares sell (N. Y.

weary

and-there

worthy equities
to
look
at
if
you're shopping in the radio-TV

startling

into the age of

future.| A thehome

famous

thfSVur Vearf

1957

$91.45

accent, it just doesn't stay around!

far

even

new

ol,fl

for

talented •Inc.

traditional program

intellectual

too

And

will

public

v
move

hns^instruments,-, these marvels of su-..

sots and

has

rnlnmhTn

land.

our

Complete Investment Service
,j

Hi-Fi

iarninffo

educational

are

angle.

;

electronic

tpresent rate being $1.50 with net

instructing
TV; and this

even
recovery because
of . many - techsignifi- nical improvements—known to the

moving

Motorola

for

schools

200

much

speaks

—has made

will

pi^uc^.^tary aircraft
production, the stepContinued
page 53
electrQ'nic:;busi-.v.^|?^^^^ft^^^^^j[
*'•
machines, Minicard and Mag-™e fSml
veS^'t^a^v
hi- '
nacard, which offer interesting
2Sstrie^and commercial entergrowth elements for the

now

very

inch

models
to
choose
from.
Many
companies had good results with

Its

are

forward two

back to the live variety.
Quizzes are here to stay and if a
show
can't
give away a little
money now and then or produce

one

;

tronics

phonograph— which;als<*
thought killed by radid

once

navigation systems for the U. S.
Government; and it has broughtits

pre-1948

been

Over

via

"canned"

many

zation.

swing

Then, port¬
and

offered!

seem

brigh^mar-

Cellar Club."

for his

mentioned

sets

TV and

cular

will

have

colleges

Of the

some

homes. "Give Junior the old

Baker

The

role

splendid merchandising brgani-

media, Westerns apparently are
ageless and inevitable. People do

replacement

sets

films

and

the

somewhat

home

for

Next there's

for

however,

are,

bright
old

radio-

talent.

accounted

total.)
In what looks

e^tra*

^vSoxeotter"a2top

Now, for the
first time, many will get a class¬
room
to correspond
with their

totalling
15,350,000
for
against 13,800,000 for 1956.

(Auto

hundreds

teachers in

duction
1957

and

ness

electronic

manufactured

were

nliis

showings. Educational TV is major factor in military.commiton
the' up-swing
with, stations nications and a leading maker
increasing their program hours of TV sets.
Motorola has paid
and ,broadening the
educational dividends regularly since 1942, the

they are outdated, outmoded and
require more frequent—and costly

sets

dividend

vin¬

logical

and

radio

was

w.*r~g.

enter-

ofoXr ^

revenues

the. programs

and

feature

(These
as

broadcast

the trend to movies is

see,
ful

screens

regarded in the trade

are

have

sets

portables)

both

its

^nClath%34eiLlthn!a^SlS^ISh'

expected to reach $5.8 billion

About

one.

public interest in

another era in

cant.

that

by 1965.

85% of the homes in America

over

which

tapped;

very

are

and

use

country

big business. They to¬
taled over $1 billion in 1957 (for
the first time).
Combined radio
and
TV
broadcasting
revenues
are

many

million television sets in

color

market

been

motion, and good trade-in allow¬
ances, should push up sales this
year. For 1957 about 180,000 color
sets were sold; this year sales of
around 240,000 have
been esti¬
mated (give or take a little for
either optimism or recession!).

all these cultural and newsworthy

bounties

our

bout to

$140,
is
scheduled to be split 2-for-l with
stock,

blanket

foot

This

Zenith.

been

common
of $2
(plus a probable.f§
'extra).
Cash position is opulent ;
The with
net- working
capital! (on
main
obstacle
has
been
price,
^ present shares) equal to about $00 :
with the cheapest sets still above ;
a
share. January 1958 operations
$400. More good programs coming were at an all-time
high.
>
out in color, coupled with more
Magnavox is another company
Dr>
aggressive advertising and pro¬

hasn't

saw

Pontiac

1958

.And,

television

week

the prize TV
commercial—the unveiling by that
TJiimelancholy Dane, Victor Borgc,
or

lofty in price1 among

most

quick run-down of "promising and challenging" electronic
industry's future is provided by the trade association's head

Command Remote TV Control."

cabinet work, and many are com¬
bination Hi-Fi units.

than

BAKER

furniture.. Some of the more
expensive models offer luxurious

language

Cobleigh

your

their defenses

cocktail

Washington, D. C.

attractive trade-

coffee tables, and woods to match

ac¬

counts deliver

Ira

indi¬

;

double

DR.

Vice-President, General Electric Company
President, Electronics Industries Association,

new

can

selling at 33Va

now

sales. There are stylish slims,
tapering consoles, triangular ones
to
fit
in
corners, and
lowboys

with

and

but

Stock

who states we are "about to enter another era in which
extremely well managed company
has
turned
in
consistently fine
[our] role will be even more significant." Mr. Baker anticiearnings, netting for 1957 about
pates higher growth in 1958 than new record of 1957.
$15.50 on the 492, 464 common
shares outstanding (sole capitaliThe electronics industry, which nounced all but killed
by TV
zation). Iri.1957 cash dividends .sjnCg the
bcginning of radio broad- has made a remarkable recovery
included $3 regular $2 CXlfd. ailU
jiqcl
inct
Hoc
onnlriliiito/.|
itronll,A
onnmo
+/-.
Un
1»
casting has
contributed
greatly and seems to be here to stay. T*
Teeh2m derives
$2 special. This latter item
dei lves t,and Grban
ascending-scale to the nical improvements in sound re¬
from an out of court settlement /
development production have revived a latent
in a suit Zenith won from RCA.

labor

leaders

trend;

York

New

plus extras.
promoting 11 of its new color

The

and attractive styling
and designing should create a lot

have

seen

production,

the

Next,

vestigation;

Electronics Ontlook for 1958

dividend

sets with

specially designed tran¬
sistors in place of the traditional
tubes.
This pilot model is not
yet reported on the market and
is probably quite a bit away from

13,887,000

plan.

uses

It is

nonstatic sets of statistics.

some

the

Thursday, March 13, 1958

leader, largest

with

shares listed and actively

Exchange and

Enterprise Economist

A broad

common

pro-

Volume 187

Number 5724

...

The Commercial and Financial Chronicle

(1151)

The Future of Uranium
FLOYD

Throughout the world, population
growth multiplied by rising stand¬
ards will produce
an
insistent

for the

demand

gram

ODLFM*

chanical

President, Atlas Corporation, New York City

will

A most

and rebuttal of

typical investors' fears.

The Atlas head

Russia to

sees

too valuable to barn

for low-cost power fuel.

big

based

notes uranium

now

supply

tn-c.

piry I have

displaced by fusion

uses
■

•

i1-

fuels

needs.

World, the

pro¬

the

era

and

unrestricted
be coming to

may

sources

the

wisely.

will force

Great Britain.

use

end.

for which it is

purpose

suited.

Coal

valuable

Economy

to limit each fuel to

oil

and
a

source

best

may be too
of carbons

for petro-chemicals and for other
purposes * to

permit

concentrate
various

burr*

unrestrictedly under boilers.
Oil products will provide fuel for

stantially less

than

metal.

ocean¬

going vessels of the not too dis¬
tant

future,

•

will

uranium.-^ If! this
evident to

fueled

were

by
quite

not

then I would view

the future with alarm.
The
uranium
industry

ton

produce

ore

the average will

assumption only about three onehundredths of a pound, or some¬
thing less than half an ounce of
this

naturally fissionable uranium

235.'
But

this

terrific

uranium

punch.

little

235

than

property about! trie
'H three

Bond'

years

foreign Subsidiary, the -,;Oii;anq §as we have consumed
"/ago.Since them Anieficanv! and ! Foreign .-Power has been burned since 1940. Our
we
have ex-/Company:/Thesetwo>companies ^consumption- of oil and gas has
; pan ded. our: constifutechohe of the great publicTexpanded much faster than the
holdings" and I utility ;systems
that; era/! I/discovery; of; new reserves.
The
l:'r
y e a r s j/rfnd -or its

from the ton of ore consists
of uranium isotope 238. While this
uranium 238 is not

*Holr

size and in value of product, with
old established metal mining
the

practically

uranium

has

been

none

yet
generation of electric

used in the

fif» 0/

nnfMf

past

the

Its use to date has been
primarily
for
military
needs.
energy.

Peace-time

represent

ore

® Fuel Deficit

organizing electric companies for;

;

uses

are

Perhaps

here

should

nium works

i^ne
neafly' countryand /from/ compahy.^to; ingly difficult to find oil
tons.of ore for a sale vaiue company,':}: 'gained'some;real in^IJllited states, with new
+

million dollais. Even

fuel.

so,

sight

into

what

few

how

ura¬

fhe start of the

year.

opment of

properties

the

New devel-

the standards of

living of that.

nation's/people./ Check

all ", the

during /countries

-..on * earth. and you will/
that the measure of ecoSV;
.cou^
kept up year nomic well-being is the amount of ;
after year, it would be a sort ol'/,mechanical
energy available per
financial perpetual motion
which,!capita.
T - ; 1
' ' "
' :\.
.".however, we can hardly hope to •"'One of. the basic facts of the :

society,

'enjoy / today in the
United States is the great expansjon 0f
supply of mechanical
energy per capita. At the turn of
"the century each man, woman arid,!

! ^ Most of the ore of our uranium
subsidiaries
at
present
to
goes
.

,^n which

w<^ have an inThese particular mills have

terest.

this is to convert
uranium

element

238

tranmute the

part into

known

in turn

fissioning, gives heat.

■

the
The

power

lieat

from

plant

use

There

reactors

this

ton of such

pounds ol oxide.

our

is milled into concentrate and that

This announcement is neither

Securities.

produced in

many

kinds of

Most of the

country use en¬
fuel, by which

I mean uranium that has had some

uranium

ore

contains

natural

235

uranium

added

that

,j- \.

'■

*:■

•

offer to sell nor a solicitation of

The offer is

7/10 of 1%

just mentioned.

Continued

offer to buy any of these

Company
,

•

130,00$ Shares Cumulative Preferred Stock, 43A% Series
($100 Par Value)

tons of
i

uranium oxide,

■as

yellow

Price

often referred to

cake, which

times that amount of energy avail-* '•
to 'able per capita. We lead the world J .

sold

Share and Accrued Dividends

.the Government under term coh-.in these respects and in conSe-r;';
.tracts. These present contracts run quence in standard of
living. : 1:

/into 1962.-.. Therefore,; to the, ex-;
..

tent

of-the-capacity of these mills

.particular
;

confident

we: are

further t increase

the'

going'!to! ^

7,,4

amount!of! '

us for ouivenergy, available;per*;capita! Butjr
have firm con- pven if we are merely to maintain. -

ore, we

tracts for
lished

product

our

prices

for

estab- \the present level, the sheer growth
four 0f! population!in
this" country

—
^
■
! I expect we will mine and ■ sell

would require

; :

Subscription Price $28.50

presently known

The several underwriters may

doubling of world population took
place between 700 A.D. and 1650—
.'-The Atomic Energy Commission *950 years. Then it doubled again
has put itself on record that from jn 200
years—from 1650 to 1850.
1962 to 1966 it will be prepared '
The third doubling took only 100,'
to pay domestic mills 8 dollars
years—1850-1950, and in 1950 it
per pound for uranium oxide, with/was expected to double again in
some
possible limits as to the. ordy 85
years.:

•chased

any

particular mine.
an

extension

year

the

program

.really no

from

pur- =

reason

its

this

Copies of the applicable Prospectus may be obtained in any Slate from only
such of the undersigned, as may legally offer these Securities in
-

Government^ was announced that in the past
there is^year our population increased by

now

assume1 3

purchases

compliance with the securities laws of such Stale.

]

million

million.

173

this

MORGAN STANLEY & CO.

ate, V. S. population will be over

the'200 million by 1975 and will be
expiration of that extended time, -nearly 300 million by the year
If we were only concerned to-,
2,000, which is.only 42 years away,
day with the stake of Atlas CorWOnder the privately-owned
poralion in uranium, my contribu- tqecuic
utility companies of the
tion might end right here, x The >
united States, based on their past
uranium outlook is not
only good,
experience, are planning an enor-,
it is quite well protected, which
mGus increase of their generating
is-farrly comforting in a period of., capacity over the next 20 years
even

.,a^

capital

cost

...But I am certain that the real :?billion dollars.
• •
C(uestion in the minds of many is
•
-pbg
World
has
what will happen to uranium after
■
..

and

accession.

«'

Francisco

"•

'•

•

offer shares of Common Stock at prices not

Subscription Price set forth above (less, in the case of sales
dealers, the concession allowed to dealers) and not more than either

or current offering price on the New York Stock Exchange
(whichever is greater) plus an amount equal to the applicable New York
Stock Exchange commission.

country, population has

growing at am even faster
rate than this forecast." Last week

the last sale

any. been

that the Government will discontinue

•

This amounts to

.purchase

less than the

oxide

Rights, evidenced by, subscript ion warrants, to subscribe for these shares
being issued by the Company to the holders of its Capital Stock,
which rights will expire at 3:30 P.M. New York Time on March 26, 1958.

are

($8.50 Par Value)

reserves.

amount

tremendous ex-.

our

* pansion
in our power and energy
400,000- tons of ore requirements.! - ; f 1
r
:
/
during the year 1958. At this 'rate !7- Population^ over the centuries;!*"
'of mining, it would take about*has been
growing at increasingly
'eight years or until about 1966, rapid rates/ The first
known"

approaching

to mine out

least

years to come.
-

450,923 Shares Common Stock

;•

]that.r is available to

feel

„

Society of'secu^hy A^aly!?,"

Feb. 25, 1958.

closer,-

together

Other peoples

see

least

recent

what

drawn

they

are

learning

why.

GOLDMAN, SACHS & CO.

&
,.OC
KIDDER, PEABODY & CO.

Incorporated

MERRILL LYNCH, PIERCE, FENNER & SMITH

SMITH, BARNEY & CO.

WEBSTER SECURITIES CORPORATION

STONE &
11,

HORNBLOWER & WEEKS
.'

years.

in the

THE FIRST BOSTON CORPORATION

HARRIMAN RIPLEY

Ullited StateS have accomplished
and

!
!been

IV.E.HUTTON

March 12,1958.

PAINE, WEBBER, JACKSON & CURTIS
,

•*'"./

The

page

made only by the applicable Prospectus.

■

„</

milling capacity of about r,3,000 !child in America had less than V2
ore per day.
r
>
...horsepower of energy at his dis-.The product of these-mills is
posal. -Today we have nearly 100

the
235

in the fuel is somewhat more' than

The Cincinnati Gas & Electric
i

to
the

about

When the ton

for

uranium

are

riched uranium

new

fissionable

,,.

plutonium,
and,

which

fissioning

ores

up.

it
neutrons
from
the
of 235. ? The result of

ftthe year brought about this re-!find

•exHrGCf

ura¬

contain, oil the average,
3/4. of 1% uranium oxide.
Thus,

wells
low—> rjettin°" deener and deeper and the

abundant

by' bombarding

reactors being tried.

Fuel

U. S.

be made fission-

can

part

escap

nium

in the

r?servJs °f ou^ cost mechanical energy means to!.pfoduction cost going up and
subsidiaries at the end a.nation's industrial progress andvAnd j think l know that i£
year were greater that at

^ Af in
u of the

say

explain

^^nlrln
5°0

„

words

reactors.

Explains Uranium

£?'

just starting

into play.

come

.reserves -

ofAmerican^- andv/Foreign- ' PoweriVflYammot one who views the
more
th an.
Company.'/
\ future! in
such
respects
with
Floyd B. Odium
three
million-/
'
/ . // ■.
' r alarm. But I do know that in the
i
h:
>. •...
tone! niir
'JV01?* Needs Cheap Mechanical ^ united States we are already cont
ent production rate is about
35,000
\
' ''"//-Energy
■
v suming
-.
&
:
C
more oil than we are pro/
per month. This will increase.
As I • went from . country to!ducirig and it is becoming increas-

sionable, it
with

But

came

until today it ranks, both in

industries.

235,

heat for

much

of
cube

4 pounds or uranium metal which

au*!

the

packs

pound

about 1,500 tons of coal.
Most of the remainder of the about

few

of
as

naturally fis¬

; has

rapidly

pounds

taking it

this optimistic 4 poundl

011

grown

losses
ton of

is. sub¬

pounds, only about 7/10 of 1%
this metal is
naturally fission¬
This
fissionable
part
is
known as uranium
isotope 235. So

release

the

But

able;

plants,

through
are

larger
sugar, contains

many

there

mobile engines for a long time to
come.
But the larger-scale power

and

refined

that the net
yield for
such average grade ere

them

conventional fuels. The

processes

uranium

unlimited

We will begin to use our fuel re¬

race

H^Jj^^6
of coa* an<* oil. for-fuel
purposes is really a comparatively

v'",.c

think

supply

means

energy

Free

expansion

enormous

the future than at present.

so^alled fossil fuels in the ground
are .one.; of our nation's capital
assets and
wasted.
J should not be
1

process.

a rather strong and opti-/the:expirationoPthepresent GovnrnPrnm

own

the

depend
for fuel

gas

and Soviet

the

and

be¬

well be between the United

^sou5ces

m over-^

JXlistic conviction^aboilt'the future -erhmniYt 'j&iir'eWnse

with

were

oil

facing it, there would be
substantially higher fuel costs in

energy require¬
ments,, both here and abroad, will
certainly tax our domestic and
'world-wide presently known re-

will;not be

me¬

-/ These mounting

ranks

potential, peace-time

domestic

supply the other nations

world

States and

military needs and uot

may

old established metal mining i industries, though

Within

fuel, causing imperative need

Hie writer

Free World

meet ..their

just coming iito play. * Explains why Jie believes atomiC,poWer; ;
will k^ rn.M.r.»:iT
-JiV c' v -at>
^
wdl be compehfive
and uranium

the

and

energy per capita.
ourselves in a race

tween the

become

find

encouraging view of uranium industry's prospects is
presented in Mr. Odium's analysis of future uranium demand
simultaneous propulsive population and living standard rise
added to depletion of our resources, wherein coal and oil will

lor

industry

power

The Commercial and Financial Chronicle

(1152)

send interested parties

Ranks °'eran,l,a,hers

On Tmst Investment Policies
Professor of Finance, New York

ink had hardly

It seems that "the

By DR. MARCUS NADLER*

Recommendations & Literature

University

dried

the

notice in these col¬

umns

of Hal

Murphy becoming a

depart¬
ment, Vincent
Reilly, 'came
"b u s t i n g"
through the

Extent to which changed course

of economic direction

may

affect trust management and

portfolio composition is examined
by Dr. Nadier who advises long-run danger of further depreciaI tion in the purchasing power of the dollar still exists—even
though current readjustment may continue until the year's end/
and be followed hy a period of stability before the economy

and ap¬

praisal—Joseph Walker & Sons, 120 Broadway, New York:./;
5, N. Y.
;""'.'J.'VvV-'V.-1.
v-;/
Atomic Energy—Review—Harris, Upham & Co., 120 Broadway, ■

-New York 5,

N. Y. /

wilt

Atomic Letter {No. 35)—Analysis of fund investment in missile
'field—Atomic Development Securities Co., inc., 1033 Thirtieth

its; upward course. The noted banking consultant ;
concludes that: (1) common stocks have a definite place ix
estate/portfolios; (2) low money/rate's immediate trend' it.

Street, N. W;, Washington 7, D. C.
:

;///:///::////'

View

Buraham

able is current Foreign Letter. ;

Business Outlook

rities

"New York 6, N. Y.

number of years,

chasing

companies—Troster,

Singer & Co., 74

Japanese Stocks

—

Current

information

—

New York

Office
t"

Broadway, New York 6, N.

Oil Industry—Review—H.
York

Oils

Equipment—Survey—E.

/■

•

;

•

;

•

received

great

flation and

deal

attention,

lar still

I
.

that

estate

invested

equities.

conservative

verv.easy

tkms^but
at

dfwst .officers'

I? ^ ^ mUC
!t
S/1016' in common
wS rili ?hl

selling at discounts ofmore—Francis I. du Pont & Co., 1 Wall Street, New :

.to raise

it is extremely

ques-;.-

proper.answers. '

Presid

The

Company,

Vice

♦

•

confront the-

doubts

many

persons,
servative . trust

report—

American Machine: & Foundry Company, Mr. C. J. Johnson,
i
Secretary, 261 Madison Ave., Rm. 219, New York 16, N. Y.
'''
American Metal Climax,
Inc.—Analysis—Purcell & Co., '50 /..".
!

page

recent downturn :in

created

New York 5,N/Y.' Also in the same bulletin are data
Continental Baking Co. and Walgreen Company.
American Machine
Foundry Company—Annual

minds

the

of; ment

officer^ , as to
a
policy » warMany, beneficiaries, seeing a
sharp;; decline
in
stock
prices,- have become quite con-"
cerned;; and the entire' problem
which
by
mid-1957 seemed to

adjustment

been

favor of

settled

forever

equities, is again the
The

outlook, the

in;

/ ..;

The

margin

fol¬

nomic
one

*An address

by Dr. Nadier before 39th' mism.
Conference, American
Bankers Association, New York City.
" r ■■

Mid-Winter

of Mr. Buckman.

■

■«

nounced during 1956 and 1957 has

there

the

Rjchard

strong squeeze on
profits, and the eco¬
has changed from

Sanb'orn,

St'

Robinson'

B.'

Rodney

HewV.-Ps.For

optimism to one of pessiThese factors do not augur

Trust

Here Is A

r r

Continued, On page 55

Special Opportunity for You:

Harriman Ripley

rated, 63 Wall Street, New York
City, announced that the follow¬
ing have been elected assistant
vice

"FOR SALE"

Sold

Clarke

II.

-Commercial & Financial

& CO.

William

•

F,.

Hastings;

Donald

Herbert

Shriver,

Ambrose;
T.

company:

Charles

Kearns;

/•

•

Chronicles, 1938-1950
-

Members New York
Security Dealers Association

Kenney, and

Beautifully Bound Set of

of the

presidents

Richard

McManus;

Roberts

Hanipv

„

Srt?

Joseph P. Ripley, chairman of
Harriman Ripley & Co., Incorpo¬

Lake Ontario Portland Cement

74 Trinity Place, New

wn1-

climate

Giant Portland Cement

HAnover 2-2400

Wol,

new

Bennett,

American Marietta

TROSTER, SINGER

the

E.».

Sc^hTe^"'
the
Waif red N. Sund is Cashier.,

American Cement

—

? Tti pL

with

Natalie'

are

■

•

associated

end.; The productive

Allen town Portland Cement

Bought

Inc.

and/Homer
/Tno " The neW

Orange, N. J., under the direction

Situation Today,

squeeze on

raised

brook,

Moynahan

Also

terest

have

Coburii

Middle/

capacity of the country is greater

uncertain

T. J.

It is evident that the,great in-)
firm
vestment boom which was so pro—

come

cen-

formerly

with
"&

forces

profits, and the downturn in inrates

the

were

prices during recent years will »e
by the purrent re-.

elhnlnated

ranted.

have

whether

Buckman

Mr)

Before an-/

con-; which contributed-to the rise

lowing questions:

Stocks

Moynahan and

danger of continued in/-

Whether, such

economic

Currently Popular Cement

Has the

;

equity; flation disappeared?

particularly

ter-of discussion.

For Firwncial Institutions—

American Encaustic Tiling—Data—Abraham &
Co., 120 Broad-

Continued

The

/ /

prices and the rise in bond prices, swering this question, one has to '
as well as the relative
stability of /consider the
present
economic /.
commodity prices, have, however,- outlook and to arrive at a judg-*

Company, Inc., Lansdale, Pa.

;

Thellussoh,

Treasurer. Mr.

proved their action.

American Encaustic Tiling Company, Inc.—1957 annual
report
—American Encaustic Tiling

Presi¬

dent;/ and

analysis of Mack Trucks and Outboard Marine.

way,

S.tua r t A.
B u e k m a n,

able to lind a perfect solution to..
all the problems that

Moynahan,

Secretary and

Steel Stocks—Analysis—du Pont, Homsey &
Company, 31 Milk
; t Street, Boston 9, Mass.
Also in the same circular is an

Theodore

difficult/

search for security is constant;/,
and even though one may not be/

Small Loan Companies—Discussion—The Milwaukee
I 207 East
Michigan Street, Milwaukee 2, Wis.
'

;

are

Even

j 37% or
York 5, N. Y.

■//

equities

..;

Group of the IBA in

Moynahan & Go..///
Formed in N. Y. Cily

almost entirely in
some

Common

Casualties—Selected

exists, what course of aca trust .company.fol-

(3) Is the present downtrend in;
rising interest rates cyclical or secular?
sharply and' jf it is part of a long range trend,
bond prices
then the proper policy is the acilarcus Nadlar
and the pur- v
qUisition of long term, high grade
;
chasing power bonds now. On the other hand, if
of the dollar were declining, the
Moynahan & Co./ Inc. has been
the downtrend is only cyclical in
advocates
of
the
purchasing character, it raises the question of formed with offices at 111 Broad.
power
criterion -gained ground i10W to obtain protection .against way> New York Cityy to act ds
secu¬
rapidly.
Some trust officers, and another depreciation in the bond dealers in general-market ^seeurities. Officers
particularly
co - trustees, < advoportfolio.
cated

Stocks—Comparative figures—G. A.
Saxton & Co., Inc., 52 Wall Street, New York 5, N. Y.
>

Recession

good-natured ribbing on his next
trip, particularly when he attends
the April 23-25 Arinual Meeting of

low, particularly in periods of de-; the. Texas
clining equity prices?
Houston.

Reilly will be the target of some'

cent boo m,
when
prices
of

event. Grdndpa

the blessed

over

continued decline in

market performance over a 19-year period —
National Quotation Bureau, Inc., 46 Front Street, New York
4. N. Y
Utility

TTnnnilv
indefinite future. Happily,

««
an

Jones Averages and the 35 over-the-counter industrial stocks
used in the National Quotation Bureau Averages, both as to

Public

the purchasing power of the dol-

yield and
t.

(2) If not, if the dang^* of in-

power*

Education—Shares held in

— Folder
showing an up-to-date comparison between the listed industrial stocks used In the Dow-

-t™
for

Co., 72 Wall Street, New

5, N. Y.

Over-the-Counter Index
t

of Wince's

born,

were

portfolios of four leading
universities—"The Exchange" Magazine, 11 Wall Street, New
York 5, N. Y.—10c per copy; $1.00 per year.

level? If
If that
that is
is the
the Case/then
case, then the
the
level?
■

tion should

•

first

the

is-

(1) Has the •.necessity of pro--'daughter, Helen Marie. The proud
teeting the purchasing power of father,' .Arthur ?H. Rothmann, is
-

During there■

•:

Company,

has
:a

Yamaichi Securities

Hutton

Y./;

Hentz &

■

Company of New York, Inc., Ill Broadway, New York 7,

le n --Marie

ZRathmannand

;

Trinity Place, New York 6, N. Y.
*
/ ::
;
•/ *
Introduction To Tax Exempt Bonds—Booklet—Scharff & Jones,
Incorporated, 219 Carondelet Street, New Orleans 12, La.

>> '

its

n own-

F. Vincent Reilly->H e
»

fee

Will

comer

I- / k

problem is
is largely
largely solved,
solved, and
and b0th mother and daughter are in
problem
as against the
'/as
keeping the principal intact will the ~''pink,"
"pink," and grandpop Vince
Vincent
maintenance become the chiefproblem con- and his missus, Helen, naturally
of ' its
purfronting the trust officer^ :
- are
beside themselves with joy
trust company

results— !

r*"/// 'r/f
')

/pou Ji d
10
/■o u n cd/new-

estate administered by a trust. acting in the manner traditional,
company disappeared because of to brand-new daddies and ...bids
the relative stability of the price fair to remain "up in the clouds"

Kidder, Peabcdy & Co., 17 Wall Street, New York 5, N. Y.
Highlights (No. 34)—Information on Housing Industry, ElecCement

con-

and

The
1 y

troversy over the relative impor-'.an
tance of
"

Build-,
'■'//■■//j

Operating

the

maintaining the safety of
principal of an estate' adminisKv
tered
by
a

Capital Investment Pro-

ing, Toronto 1, Ont., Canada.
Fire Casualty Insurance Industry—1957

^■

/1:

grains—Discussion—E. M. Saunders Limited, Victory

tronics

v;;-f

Introduction
For

& Co., Ill Broad-//

;

d.tficulties involved, /

Secu¬

Co., Ltd., 61 Broadway, New York 6, N. Y.

Financing Government Deficits and
*

•:

Copper Industry-^Memorandum—Talmage
way,

in 1958—Review—Nomura

for Japan

;

Y./Also avail- //

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

has
the

■:

pranks..
;

peak; (3) bond diversification is desirable r and (4) trusteeship is bound to increase)with laymen's growing awareness off//

•

Investment letter —Burnham and

Monthly

—

%"r:V.'V-

/'/'/; V". lf "'//•'•/

he;~ too,
j-oinetl

/down hut secular rate's is upward—though not above 1957

Corporation, 120 :

Bond Market—Review—New York Hanseatic

/: Broadway, New York 5, N. Y,•'

an¬

that

nounce

resume

■

r -

door

','/';////.--vv ::-//; —

./,•

advertis¬

our

ing

the following literature:

Aircraft Missile Manufacturing: Industry—New study

grandfather before his associate

New York City

will he pleased

understood that the firms mentioned

Thursday, March 13, 1958

Impact of Economic Readjustment vincent ReiHy Joins

Dealer-Broker Investment
It is

Available in New York City—Write or

With Florida Underwriting
(Special to The Financial Chronicle)

MIAMI, Fla.—Edwin Chern has

York 6, N. Y.

Phone REctor 2-9570

Edwin L. Beck

become

-affiliated

Florida

with.

Teletype NY 1-376-377-378

•

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

Underwriting and Securities Serv¬
ices

Bank

-Corporation,

Building.

Metropolitan
-

Volume 187

Number 5724

The Commercial and Financial Chronicle

...

"Our goal is a world under law;

„

aspiration is

our

ROCKEFELLER*

By DAVID

Vice-Chairman

Board

overall Conclusions of Rocke¬
Military Security study, the noted banker contends con¬
tinuance of 4% average growth rate would enable increased
national defense spending of $3 billion annually for next sev¬
eral years to be made without stopping living standards from
rising. Mr. Rockefeller concludes major long-term economic
problem will be producing enough to meet inevitable demand,

...

should like to discuss

some

.undertaken by the Special Studies
Project of the Rockefeller Broth---

Fund.

ers

Some
have

"that
;

was

sued,
at

lems

which

both

servants,

Some

have

cans

*j-

100

outstanding
serving

Overall Panel and the

have

panels which were set

least

read

tensive

the

discussions
have

sessions

press.

;;

the

work

six

the

other

Report

Several

United
budge¬

normal

Security

Military

an(j they

first

threat

free

the

re-equipped for atomic

The

overall

conclusion

that 43 of

85%

the

military

our

...

oiir

our

•

;

limited.

(3)
There
are
major r short¬
comings in our military capabili¬
ties at present.
Our retaliatory
force
is
inadequately - dispersed
and protected; oun defense is in¬
sufficient, we lack mobility and
versatility for limited war. This
;

means

that

must increase

our

efforts in the production of: mis¬
siles
and
aircraft, , anti-missile

missiles, submarine missiles,
the like.

located

are

our

world must be

prepared
any of three types of
aggression: all-out war, limited
war, and
non - overt aggression
(such as coup d'etat or civil war),
(2)
To deter aggression, we
must
be,; prepared
to
fight if
necessary a nuclear war, either
all-out

;

largest cities, and

industry,

our

would

and
j

coasts. It

(4) Basic changes are needed in
our
defense organization to cor¬
the U.S.S.R. will be capable of
rect the inefficiency and duplica¬
delivering massive air and missile tion of effort growing out i of
attacks against all major targets
interservice rivalry. >
\
■ ?

ihe Report'ofpSihl'lH"
"It

within 500 miles of

security
can best be summed : lip
v.
in the following quotation from

...

prepared by the most competent, experts which could be
found in various fields. Many of
these experts also participated in

clear when it is recognized

comes

Study

United States

resist

The

war.

The

the free

The seriousness of this threat be¬

Military

panej that considered

(1)

fight a preventive war. But
the United States and the rest of
never

world.

Soviet ground forces are far larger
than our own, and they are being

the

II.

serious

are

will be released shortly,

Sums Up

and
_

Reports

tions in other fields,

ex-

other

War

general Soviet navy has more than 400
findings and conclusions of the submarines
in
operation,
and
Report on military matters
and there is no doubt of their capacity
then f shall try to teil you some- to
develop nuclear
submarines
thing of the results of delibera- and to equip them with missiles.

Panel

coimro

the

'turn

shan

Sub-

The

World

since

ever

•

in their final stages, however,

now
j

pecs

Security—The
Military As¬

believe

the

Thus, to our surprise, we are find¬
ing that today Soviet science is at
least equal to our own in many
strategically significant categories.
As a result of concentrating on
military technology and produc¬
tion; the Soviet has an impressive
and
rapidly ' growing
military
establishment yvhich poses a very

our security is founded
principles for which we

earn."

the

hir
I
ooavao
nr
c*
enriched by
several scores of pa-

nnrinnoH

This Report,
"International

transcends

Union

because of its urgent importance.

oriented

been

now;

security

military technology of the Soviet

Subpanels
was
still
in
.process, it was decided to release
,

Amerion the

the

end in itself.

run,

Although

seven

up.

can

the

public
Executive

been

States

our

the

unless

stand and in the confidence which

confront

accounts

Jong

of the complex and difficult prob-

the

report

•

aims

only give us security
against immediate dangers. In the

helping the people of the country
to come to a better understanding

f it

Power

Departments and in the Congress.

may

seen

...

these

•let force become

utilizing manpower at all levels, supporting research and ensur¬
ing adequate supplies of raw materials and fuels at reasonable
prices. States defense effort cannot permit major tax reductions and might require moderate rise in tax yields at statelocal level. Turning to present recession, agrees every effort
should be made to check it, and notes monetary-tax ease will
occur as required.

the results of the studies recently

taken

and suggests encouraging output by revamping our tax system,

■

for individual must be
dignity. But we will that the

stating that; it is not too late if
we are prepared to make the re¬
quired big defense effort now,
are
prepared to make the effort tary considerations and that the and in the years ahead.
required
to
survive. We
must, national economy can afford thp
1
:
Action Program
'therefore, - strike a fine balance necessary measures." •
:
:
between vigilance and
concilia¬
What is it then that we need
The Report goes on to point out
tion, prepared to use force to de¬ that we have suffered from a to do? The "Panel's conclusions
fend freedom, but wary not to
can be summed up iix this fashion:
tendency
to
underestimate
the
realize

not

Based ob, and after summing up,

respect

and national

feller

based

of Directors

The Chase Manhattan Bank, New York City

quirements. The United States is feet, we are still ahead. ,But, they
international rapidly losing its, lead in the race are
gaining „at
a -ratethat
community from which the threat of military technology. "We are threatens to dose the- gap. How¬
of 'war has
been
removed
and convinced
that. corrective steps ever, the Report is emphatic in

(1153)

judgment that all is

clear

the

that

within

non-communist

few

years

world.

(5) We must strengthen the
Rus¬ regional groups of
nations, such
nevertheless,
as the North Atlantic Treaty Or¬
f title implies,
The seven Subpanels cover the
still- have at present a superior
addressed
t o
ganization, and the Southeast Asia
following fields, international ob-,
David Rockefeller
the problems
technology
and
in
the- world military * potential. ' For perhaps Treaty Organization. /■'
of meeting the
jeetives,. international security- political situation. In • major the next two years, any Soviet
(6) To accomplish all this, the
attack on us would meet a crush¬
challenge our nation faces in the UJJLPJ'respects defense organization is
United States must help in the
ing
reply.
However,
this
fact
military sphere. I must say that
development of a common stra¬
obiectives
education unrelated to critically important
leaves little room for complacency.
the response to it has been most
military
missions.
Systems
of
tegic concept, in the re-equipping
Unless
present
trends
are
re¬
encouraging — so much so that
and the'moral framework budgets,
appropriations, and fi- versed, the world balance of of allied forces, in fostering politi¬
more
than 400,000 copies had to Process ana tnem
a
a
wo k nancjaj management are out of
cal cohesiveness and in economic
power will shift in favor of the
be printed to meet the demand.
and
technical
cooperation.
We
weeks each of the Subpanels gear with the radically accelerSoviet bloc, to the peril of the
must
also
pool
scientific
and
has been at work
a
ating flow of military devel°P"
Evolution of Rockefeller
itc fipVrt
TnS
cnrJL ments. The United States system free world. The problem is not technical information

pect", is,

its

Panel discussions.

the

no*

security

■

with; present

policies

and

Formidable

operations.

sian

forces

though

are,

these

we,

socSl

SroceS

pLf

Perhaps it would be interesting
I were first to outline briefly

the

general

draftee

P? *

Special Study

—

about

the

how it origThe Project grew out of

conviction of the Trustees of

the

Brothers

Rockefeller

that there

nation's best thinking
a

to bear on

major reappraisal of our goals,
a statement of the problems

and

the United States in the
ahead in the light of a
rapidly
p
J
changing world situation.
To this end, the Fund undertook to assemble a group of citizens
of stature who were given
the task of studying and redefinfacing
years

ing

issues

the

nation

today.

work

portant

already

being

problems by such agencies
at the Natonal Security Council,
cific

and Planning Board
in the State Department, and the
Council
of
Economic
Advisers,
most of this effort is necessarily;
Policy

limited.

governmental

one

is charged with considering
the full scope of what the nation

group

may

face in the years ahead. Fur-

we all recognize that
government officials are so harby urgent matters which
must be dealt with from day to
dav that they have far too little
time to reflect upon the general

thermore,

assed

of events,

sweep

have

them

most
-

Jjjf*composition

the future

Ya^e? SS™
♦

This announcement is not

Arthnr

p^.-iintP5 thp^lnv^^'
°^

pl e

on
i

npt_--

could be based. The

that

serve

study of
a

FlinH

fpU

Fund felt

this kind

constructive
.

would

purpose

J?
^ Resea ch, Lavid
Sarnoff, Chairman of the Radio

$30,000,000

^iporation of America; General
Lucius D. Clay, former Com^ander-m-Chief,
U. S. Forces in
Europe; John S. Dickey, President

The Columbia Gas

Minneapolis, Minn., March 6, 1958.

System, Inc.

4%% Debentures, Series J Due 1983
Dated March 1,

1958

Due March

1, 1983

Workers of America; Henry R.

Luce, Editor-in-Chief of Time,
Life, Fortune, Anna M. Rosenbeig,
former Assistant Secretary of Defense for Manpower and Personnel; Dr. Edward Teller, Associate
Director,
University
of
California Radiation Laboratories,
J. Cameron Thomson and John
Cowles. As you can see, from this
sample, the Project has drawn
together people with broad experience in many fields—business,
government, labor, education and
science.
It

Price 99.625% and accrued interest

The

sincerely concerned with the

problems and challenges we face,
I h?ve devoted some time to a
description of the purposes and
procedures of the Special Studies
Project, because I believe it is

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

HALSEY, STUART & CO.

AMERICAN SECURITIES

framework
Report

prepared.

within

which

WOrds Of the Panel:

INC.

run.
cZ°In the

HALLGARTEN A CO.

A MERLE-SMITH

INCORPORATED

SCHOELLKOPF, HUTTON A POMEROY, INC.

ROTHSCHILD A CO.

INCORPORATED

WEEDEN

TUCKER, ANTHONY A R. L. DAY

STROUD A COMPANY

BLAIR A CO.

A CO.

BACHE A CO.

INCORPORATED

R. S. DICKSON

BAKER, WEEKS A CO.

BAXTER A COMPANY

GREGORY A SONS

HIRSCH A CO.

A COMPANY

INCORPORATED

NEW

YORK

SHEARSON, HAMMILL A CO.

HANSEATIC CORPORATION

FAHNESTOCK A CO.

COURTS A CO.,

BALL, BURGE A KRAUS

F. S. SMITHERS A CO.
f

IRA HAUPT A CO.

WM. E. POLLOCK A CO., INC.

the

Military Security was
But
while
military

important in the long

such

BEAR, STEARNS A CO.

CORPORATION

DICK

COFFIN A BURR

in security is our most urgent concern, it is not necessarily the most

Ihe'Sbe/if
merce,

offer to sell or a solicitation of an offer to buy these securities
offering is made only by the Prospectus.

important to understand the broad

Continued

pu!rn<f

which poli-

with

the

military front—in

twpph

devote a substantial part of their
time to this enterprise is to me a
heartening sign that our nation

the

The

the Rockefeller
Brothers Fund organized the Special Studies Project in June 1956
with the aim of defining the problems and opportunities our nation
is likely to face over the next ten
or fifteen years; of reviewing our
national purposes and objectives;
and of developing conclusions and
cies

behind

impossible to over-emphasize our debt to everyone who
has worked : so hard on the
policy for project. The fact that so many
busy people have been willing to

Accordingly,

recommendations

now

are

Soviets

of the Panels

of Dartmouth College, Oveta Culp
3 h£' TJ^rm®r
S SL °.
Health, Education _and Welfare,
that confront the Jacob S. Potofsky^General PresiWhile much im- dent, Amalgamated Clothing

clone in Government on many spe-

the

meetings

far,

Fund

need to bring the

was a

that

must be adapted to
constantly changing strategic re-

of the Special. iasting the better part of two days.

scope

Studies Project, and
inated.

Panel

held

been

ife-

pffnrf of alliances

intpnsifv Of thp

STERN

BROTHERS A CO.
VAN

March 7. 1958.

SWISS AMERICAN CORPORATION
ALSTYNE, NOEL A CO.
...

page

our

The Commercial and Financial Chronicle
10

Thursday, March 13^ 1958

(1154)

cross
purchase agreements .the
surviving stockholders or partners/
-

Estate Taxes and Business Mergers
;

By HAROLD M.

SOMERS*

Professor of Economics,

Dean and

School of Business
Lecturer in Law,

Administration

the interest

out

Thus

the

company

beneficiaries

from

University of Buffalo

from stran-

est of the deceased.

deals with the

Somers

Dean

problem of

firm's survival

ficiaries

firms, particularly closely-held ones, trying to protect

tices of

While insurance, stock-redemption and cross-

their entities.

purchase plans are found to have their advantages, the Econo¬
mist notes they do not deal with the principal cause of the
sale of small firms to large corporations; i. e., the
tax.
Author outlines major revisions to lessen estate

estate

extraneous bias in

The

tax

estate

one

factors contributing to the merger

businesses

small

corporations.
the

•

tax

effort

examine

shall

large

into

why it has
There

and

in
closely-held
rations;:
(1) uncertain¬

practices
1

cor p o

how

much

the

tax
M. Somers

Harold

will

be, and
(2) fear of in-

sufficient liquidity to pay the tax.
The major elements of uncer¬

tainty lie in (1) the valuation of
closely-held securities; (2) the ap¬

plication of the attribution rules;
(3) the variety of court deci¬
sions on the same point of law.
'
The illiquidity results from the
fact that shares in closely-held
corporations are hard to sell on
death of one of the owners; and
even
when a buyer is available
!
there is the danger of bringing in
and

Estate taxes

not

are

as¬

proceeds of the

;a stranger who may disrupt
operation of the business to

from

result

loss in capital value

should,

death.

the

course,

There

someone

ready to step into the dead man's
shoes immediately and effectively
but this ideal of management can¬
not

always be achieved.

The next

best

the

replacement of the departed

thinjg' is to have a financial

ecutive.

ex¬

appreciate the signi¬

ficance of these factors

companies,
especially Closely-held companies,
in trying to guard against the con¬
sequences of losing a key man or
a major stockholder or owner.
Nature of the Problem
The death of

key

man

any

business firm must necessarily re¬
sult in a pecuniary loss to that
firm.

His experience, contacts and

know-how
also

was

are

the

about

gone forever.

partner

stockholder

his
death

enterprise itself.
be

fate

death

may

the

If he
major
bring

business

There may even

than death such

worse

mismanagement
a n d
persistent
wasting-away of assets. The prob¬
lem of ensuring business survival
in the face of the death of a major
executive, partner,
is

Loss of

shareholder

matter that is of great impor¬

tance to every business firm.
Loss of
are

So much for the
has

man

Key Executive

of the key

case

interest.

even

if there is

partnership

shareholder

ment

The

or
involved.

takes out insurance

ele¬

company

the life of

dynamic firm.

Even the best in-

tentioned fiduciary will tend to be

conservative in

view of the leeal

restrictions imposed

him.

If, in

addition, the executor lacks busi¬

experience,
of

often

and

are

form

not tax

investment

deductible.

The

for

firm

the

owners

the

surviving

to recaoture the ownership

interest

soon

possible.

Stock nurrbase agreements:

redemption and

cross

purchase

Fow

owner

was

not the

of the comoany and as long

get the

ownership

interest

must

one

(partner

owners

the

ments.

the

surviving

shareholder)

The two

so.

Either

buv o"t

must

dev'ces

pi^-

Dean

new

financing.; ;/;-/■./•*/
' .The

impetus/to

greatest

the

radio sets of 30 and 40 years has been the increasing military
aS°>. tha s}0,y. of: the modern dependence on electronics to meet
semiconductor industry really the growing complexity of modern

the estate are
value

ownership interest;' ftarts just before: World War II.
wrangling can be avoided
that time research laboratories
by having either the
stock re- were working with a somewhat
demption plan or the cross-pur- new method of electronically senschase agreement specify the price ing.ob j ects,"now called radar
at which the ownership interest
and American scientists,
the

Endiess

dated.
ket

when

reliable

not

large

there;is a

type radar set..Several thousands

device with a. few simple parts,,
of. these.^ devices were produced jt is far more .rugged and can
during .the . war. The interest better withstand the shock and
generated in germanium and sili- vibration to,, which military and
con during the war led the "Gen-:
ln^r^ tnT

block of stock to be liquiIn that case, the stock mar-

generally

quotation

re-

garded as being too high. Occasionally, however, the opposite is
true: a controlling block ot stock
may

get

Electric

Cora Fitts

case

efforts

research

physics -v. after
it

started

by agreement, are well ll- .a-stable
by a recent Tax Court a

237 Fed.

Gdmnanv to further

FinalI7'

0rai: flectrm Company to further tance,

than the 'current
quotation.
1

stock market

the

{ ^ lmP°r'

is their useful life of a
state transistor. f Regular commercial
In 1946 vacuum tubes have an expected

solid

war.

producing quantities of
freauencv diode of
5 of operation. Highly stabilow "equency diode oi llzed 5-star'tubes have an ex-

iow

Sermanium useful in many com- pectancy of 95%. in 1,000 hours.
mercial . electronic> applications. Transistors however have been

Commissioiieri

(2d) 729, (C.A. 8th, 1956).

tfoils1 in/"s^npljf'be ^totalled'tby /USe
•

the Tax Court!

"Roth method*?

Stock

agreements.

the

out

oil

of.

nart

stockholder's

hnys

(JceoQce(J

Under

■

and

taxes

(or

The

use

the

stock redemption

Internal

Revenue lCode

which permits sufficient stock,

demotion—i£

certain

reoinrevents

ai'e

estate

taxes

the

libei.ate

expenses

—

tial'v the equivalent of
and thus taxable

P»e

re-

and

ad-

bv.: the

dividend

income to tbe

deceased.

Beyond

tbt's amount, however, fkere is :fhe
dancer

that

be trpflfpH

tbe

redemption will
jnpomp to the estate

and tax^d at. ovdinarv

mcoroe

ratpc tioipco thovp i«s

rodomption

the

ceased

to+nl
mhn

that,

ings

estofp

are

equipment

tax

d=«'n"Hv

the; de-

bewev«r,

vxpnofipiavies

*hphi^pd

Continued

ho'd-

docid-lng

page

vacuum

rugged

and

emphasized the

small, dependable
is

device. But what

the basic transistor—and how in
general

;

th|'0r
transistor

does

operate?

mentk)ned that it is

have

amplifier.

tubes-

'
Perhaps a more accurate defini"A transistor is usually described tion would be to call it a "control
by the press as a "pea sized de- device." The purpose of such a

vice"

that

the ,ffiuch

coyer..

without fear

received

ca«h

could

does

the

job

same

most

same

people.

job

does

the

tube-

vacuum

amnlifv

device is to control large amounts
oiE electrical power with^ery little
expended

power

-j-

tube

vaeuum

And.that just about describes it

estate would be declared snhefan-

estate

"electronic

percentage

met

funeral

and

ministrative

requirements which

from^ the,, limitations ot

plan is encouraeed bv Section 303
of

o£ itsof fascinating
theoretical
long life, and low

features

attri-

bution rules

cfooV_re-

interest.

agree¬

pomoonv

the

expenses;

come

"ctooV-niirohase"

TTnder

redemption

administrative

heading

power

are

"stnoV-redempFon"

dpmrvHnn plans the

Somers before
the American Finance Association's an¬
nual convention, Philadelphia.
address

sur-

caniheart: of the galena crystal rapidI development of transistors

surviving

The

and

prnpi'illv concerned with the

ic;

•An

firm

4,;

«Although semiconductors formed

Vninimi'/ed

not

business

tbat
can

rdans an^ "erncc_niiroV»ace"

the deceased

stock

p'ans

The estate of the deceased execu¬

■»

experience/'^/H

vival / prerequisites and potential- ability toy make electronic

.'•/.*//

problem of valuation

The

For the sake

known

lone

undoubtedly^

sThe!;'writer/analyzes semiconductor industry's ^financial
;

Valuation problems

the

of business survival it is desirable

proceeds of the policy are tax free.
tive is not affected in any, way as

purposes.

widow, there is serious

interest out of the estate?

premium

will
industry's

years

made

the corporation

garded

ing executive, "the^ next three to five

amount of the policv on

The

10,000

its executive and receives the face

his death.
payments are re¬

(somewhat modified for TheI germanium diode began to demonstrated to, have a life^of
The more challenging and more
d b in 194g
d .
ig-0
98% survival at
hours. ;
complicated problems arise when purposes of this illustration) were: fl
ancl;0> 19o0 was
in our engineering laboratories
the estate of the deceased has a the taxpayer submitted a value of .;lounf? m
$150
per
share;
the
Commissioner
m
widespread
use
in
computer
at
Electronics
Pai'k
we
have
somepartnershin or shareholder inter¬
on - life
test_ now
est in the firm. It is usually desir¬ used a value of $600; four experts circuits, control devices and al- transistors
television
receiver, exceeding 26,000 hours with no
able to relieve the estate of this set values ranging from a low of most' evqry
ownership interest as soon as pos¬ $150 to a high of $225. The Tax- 1^[e £ubHcitv was civerr this ^ange °f ?haractenstics. This is.
Court,
after
saying that all the y
PUDiicity was given this tbe equivalent of nine years at
sible to ensure the survival of the
business (to say nothing of the appraisers had some qualifications device, however, because it was eight hours a day — longer than
and that their testimony was; not overshadowed quickly by the 1948 most
electronic equipment will
desirability of the estate's acquir¬
ing cash in place of its ownership ignored, set a value of $375. This Bell Lab announcement of a three iask Our most famous test, howinterest).
During the period of happens to be the average of $150,velement amDlifvincv device made e.v?r concerns the groups of tranand $600. It also haDpens to be the ■
i
1
P;fy 5S „ I
slstors we fired from a mortar,
administration
of
the
estate,
a
worked' afterwards. The
large ownership block that is con¬ sum of $150 and $225. If the latter of germanium and called a tran- They
is
the
basis
of
the
figure of $375, sistor. The transistor .'excited the shock
they had withstood was
trolled by an executor or admin¬
it
suggests some danger iti having interest of the scientific world be-at)0.ut 15.>°90 G's or 15,000 times
istrator will tend to hamper any

financial offset to the loss of val¬
uable services

Though in -1958 alone, semiconductor sales shod i expand / -./
33% or $200 million, according to General Electric Engineer- >
!

lustrated

ownership

danger to the firm.

mizing the effects of the loss of
the key executive.
Key-man in¬
surance will give the company a

The facts

ness

various ways of mini¬

> >/;

plan or cross-purchase agreement '>;>/
equipment industry of the future unrecognizable as such, and/;//
will reduce or eliminate disagree- - -v
v
/ emphasizes/need to plow-back earnings in order to continue / y
ment over the valuation of; the.,//
basic research, development, mechanization and attractiveness l*
ownership interest for estate tax j<.

fixed

Or Partner

case

There

Major Stockholder

must

review the practices of

produced by 40

fold increase in salesto//

a seven

be the most crucial and difficult in the

The problems of valuation
of
closely-held stock, absent a price

heirs.
In orded to

now

pany

the

detriment of surviving owners or

semiconductors,

warfare. Every designer ^of military equipment had been looking
for a smaller size active electronic
component with - increased rel'idicy may tide the company over a
bility, improved performance/legs
low period until adequate mana¬
heat dissipation/less power drain,'
gerial
skill is acquired fro m is to be
recaptured. Where" there *n their development work less weight, and longer life, Bewithin or without to replace the
is a ready market for securities in ; radar/-found ^ that' vacuum : Cause of the simplicity of a tranexecutive who was lost through
there is usually little difficulty, tube diodes did not do the detec- sistor,-all of thCse desires can be
death.
Even here there is a problem of tion job needed/Because the need; accomplished to some degree,
Even if the deceased executive
deciding which stock market quo- for a device to^ fill the need was
There are no/filaments in a
was so indispensable that a liqui¬
tation to use. Generally, the pro- urgent, .crash programs were in- transistor as
in a tube,- which
dation of the company resulted cedure is to take the average! of stituted in 'many--research labora- results in less connections, and far
from his death, the cash received the high and low on the day of tories. General Electric developed less power used or heat generated
through insurance may make up death* alternatively, one can- take 1 and produced some silicon diodes In fact the transistor may require
some or all of the difference be¬
the value one year after- death.;' *or /his purpose for one type of only 1/ 100th the power of a tube.
tween
going-concern value and There are complication's intro-* radar, and
later found - that This of course further reduces the
liquidation value of the firm. This duced by the problem of "block- germanium
diodes ; were better size of power supplies and thus
protects the owners of the com¬ age." The stock market quotation suited to the needs of a different the overall size of equipment,• |
and the survival of the
company is at least temporarily
assured. The proceeds of the pol¬

.business

.structure

which in this case is the company.

policy

affect

that

ship" in the policy, such as the
right to change the beneficiary,

sessed against the

two aspects of
the estate tax

he had no 'Incidents of owner¬

ecutive.

are

closely-held,

otker

and

/ / $1 billion annually in 1907, Mr. Fancher predicts, making pos-yr
sible $12.5 billion new electronic equipment in that same year//'

share-

or,,

the fact that the stock

receives a sum
of money as compensation for the
loss of earning power suffered by
it through the death of the ex¬

see

General Electric Company, Syracuse,- N. Y.

;manufacturers, should find

The also gain through V
redemption

company.

The company thus

this effect.
*

interest

holder

merger-sale decisions.

the

partnership

liquidate

uncertainty and illiquidity which is said to present an
<■

receiving a cash legacy for what y* y
might otherwise be a hard-to-

merger or

tax

•/.;//

Manager, Semiconductor Products; Department

/Transistors

•

(such as
orphans) gain in various >ways,
They gain through the cash acquired to pay funeral and administrative expenses and estate
taxes and through the assurance of

key executive or partner or major stockholder dies,
and offers salvatory suggestions after reviewing current prac¬
when

General

frvj !

thus the benethe widow and

The estate and

"/;

•'

UANCHER*-.;,/.Lw

By H. BRAINARD

whom the estate or the
beneficiaries might sell the interto

gers

York Bar

Member of the New

Semiconductor Industry's Outlook
And Electronic bdustiy's Future

of "the de¬
is as¬
sured of non-interference from the
estate
or
its representatives
or'
buy

ceased.

special filament wire into space
and collecting these electrons on

nampiv

llme

a smaI1 vo1" another
electrical energy into a "plate,"

larger volume of

-n

cmoii

energy.

vol

However,

the principle by which it operates

the movement, of electrons
,

and
,

to do this.

tube3 this is accomplished
boiling electrons off a very

vacuum

of metal called a
and at the same time
the number?; of these

piece

regulating

electrons that reach the plate by

a sma11
screen.°£ ^.ire- " is,the
process of boiling the elec-

very

ln a solid, is considerably trons from the filament in a
different.- This difference from vacuum tube that costs money,
electron

tubes

gives

rise

its

- - *An

address

Mr.

creates undesired heat in equip-

mant' and causes the tube t0 wear

outstanding advantages:
_____

out.

Fancher

before

fycTevei^nd^°ohfo. °f Secur,ty Ana"

the

transistor

Continued

the

electron

on page

Volume 187

Number 5724

The Commercial and Financial Chronicle

From

(1155)

years, even granting that they are
showing declines from the highs.

The Economic Outlook

By A. W. ZELOMEK*

Ever since the

President and Economist

International Statistical Bureau, Inc., New York

vV.V:, <i...

By CARLISLE BARGERON

Looking .into-ther future for

keep'
Capitol Hill that .President always advised on

This
This

fear».and ,£xciternent
caused

Russians

•V

L.!n°b°.w

But

George and his

reckoned

is'lover, " that

assume.

is,;no

made

ii *"£<1

economists

differences between

indicative of

despite

tive.

little likeli-

very

sumer

the

this* and

1954

upturn of lesser intensity, and

answer

to this

year's

will he

were

seen,

;J Instead ;.of just*; quietly,A Several times since

the

1929-

probable

ness

con¬

tration

e.'- W

and

that

-way •;the

•

-jhaving trouble
Carlisle

getting the
i >■second

Ex-

Bargeron

jplorer into the orbitJbut

-j

lone

there

more ;.thaif T70 •-million
people in this country were diving.
iheyjwere buying too many aiito-

very

^ Aut

They went out almost

thereisithegeneralexpectation
?
expectation

as a

date

whVSi

Lin
•5of dS a
pprS ?n

can

unit ;If there is any :
whether this
exists,

concern

to, heed them .and agree that they, all one has to
would keep -their.old iautomobile,. do .is read the

nihor

nnA

machine. Iiij daily papers '
dustlY agreed that it would slow and trade «

A. W. Zelomek

'the AdminL fh^ra^io^watch

it possible to read the signs of
ifjthe political times more|'than' in -jetraticmVonn*ivarir»e eftter^'th^tinte
ikthe
Democratic
leader, Senator
these

gentlemen

are

t0 turn the spout on again and
-; they are finding it is not easy, f
■n! before thJchrist^afholidavs He
Although Herbert Hoover got
tushed to Washington and called the blame ior ^he 1929 collapse it
k committee meeting to which should have been a surprise to noscientists-

called

were

tofb,octy' It was a i'ictitious.

berate the Administration-for not

having-given them enough

money

i»nd not having trpateri them with
i-alld
not riaving tieatea tnem Wltn

and

mimherif

inh

It looked

importance.

currently in

are

'readjustment. To

suffered from what
a stroke
'
v

some

extent,

••'

ouicklv and

scientists
;

qilfeted,

got

satellite into

Sbb^gMDf X
been
mofe-or-less

has

"hat

the agitation
education

our

over

has died down and

system

or-less resumed the even tenor of f
our way.r.

those!of ua^who had expected this
adjustment. Those who
questioned the expected downturn are now questioning the ex-

beginning
to wonder whether
the answer. If
add

tthe this
now
all

Richard W. Barri tiger

the

uncertainties,
and

current

ferent

than

favorable

the unfa¬
influences,

situatibn

the

Of readjustments

Joins C. C. Codings

the

vorable

;

such

dif¬

periods

•

—
■'
•

' J-'v

.•

„

This adverliseme.nl ts not an offer to sell or the solicitation of an offer to
buy any of these securities, The offering, is ntpde only by the Prospectus.

NEW ISSUE
—

-»

■

„

....

March 13,1958

$30,000,000

Mississippi River Fuel Corporation
Twenty year 4%% Sinking Fund debentures,

1948-49

To take the place of this con¬
and 1953-54.
|
5
troversy lias come the recession
PHILADELPHIA,- Pa.—The inHaving lived through 33 years
or
depression or readjustmentvestment securities firm of C. C. of economic analysis and forecast¬
whatever
you
want to call
it. Collings~ "and
ing, I sometimes wonder whether
Lyndon Johnson has taken it up company, Inc.,the economic analysts should not
:

eye cal

•

have more- -

.......

about bad business

Press Gallery at the Capitol read-pected upturn. Those who were
on the news ticker of the first projecting the long-term future in
stock market drop. Here it is, glowing terms through straight
they agreed, right; on schedule -line growth because of population
like a railroad train'
and increased living standards are

do ■
There is no excuse , for
to trouble we are having now.

the Russians

it conform

make

rppnvprpii

Prpcidpnt

thg

Rn'f

Can't Afford Depression

?ibly l^48-49. There is certainly

paper or

™?laPs®°" the b3sls that every$nn8
£°es tip must cmae
\ /emember very vividly
commonly the day the newspapermen m tiie

called
•

•

forecasts

business

stock market prosperity we had -no comparison to 1930, 1931 oi
been- enjoying and people -gen- 1937. ,
erally had been predicting > for
' This is not an easy period for
nnA
that. Ihoi-a
thp prnnnmif fnrppa^tpr
fnr
that theie had to be a
rn C orecastei, even IO.

Sand about this time the President f,ow1?i

the

give you

^ana

though the Administration was
truly in for some stormy weather
as

cated as lonS ago as last year by ship will force us to avoid a major
those who were then able to depression now or any time in our
recognJze the sig"S' '
'
'lifetime'

PVPn

jthe proper

■

re-?

However, forecasts by the; If this sounds overconfident, let
prophets of doom are far more me give you the facts.
has been slightly greater than alarming than warranted by the
Production is off nearly 10%
some of us had expected; in other actual facts. A lot of the impor- from the 1956 high.
respects it is not much different Janj; indicatois are niaking excel■
Av
44
than the qme in 1953-54 and pos- lent showings in relation to earlier k
Continued 071 page 4

trying V- We

Lf fhSf L wli AdSc

sundry

television

thp^infrpasintf

boostedIhfcosfofmoney appfiSnts

]

the false

always

be.

CompLaints

isfSe madeq^ their old washing

They do nottrealize that although history does not-hecessarily repeat itself, it does" teach
are rampant now — among pro- us
something about our mistakes,
flucers and distributors, large or- in my book "No Major
Depression
ganizations and small ones. There in Our Lifetime" published origiis no denying that general businally late in 1953 and shortly to
ness is down markedly from the
have its second edition released
high, and that we are in a period soon,. I make the point that the
of readjustment.
As a matter of responsibilities imposed on Amerfact, this readjustment was indi- ica by virtue of her world leader-

caus-

^concern.

n g

necessary

solidly grounded

•

another

a false premise bewho make the comevidently do not realize
how different the present situation is from the previous periods
to which they refer.
"

begin;, to

pasis for my conclusions. Because
believe that my forecasts are as

the

is again

enjoyed. The people finally began

they're

ever

p•

pick; up. I'll have to give you somq
figures
not too many

to..break the greatest and most ,\q u;e stion
soi1(j prosperity this country

-it

-i.

it will -first

mg:i that
cline

•>, ./-•

where

is not surpris.1957

; mubh on expansion,-we were havgot jng what these economists called

amjnflation.

g r e a

Therefore,

mobiles,- too; many: washing' ftiachines. Industry was Spending ;too

and thferpoliticians

iLif

;

1930-32. These

against

the5 Adminis¬

cor

to
a

:seem

Thus, when a read¬
come
along, too
think — this is it.

does

people

predictions are based
premise that history

should

decline.

They expect it
1937-38, or even

I"
extent,

many

and doubts he is

recovery

frightened.

justment

the

decline

allj and

Since the end of the war, many
have been expecting a sharp busi¬

recession,

sees

perhaps this will help us keep
present situation in perspec¬

;

unwarranted

assume

the

•*,»
™m«l>at« sharP upturn. The business economist
two

discerns

colleagues
importance 1

without .the

which.- these

hay

general business trend has been

two" sputniks
there

the

launching of
>

elusion that the greatest portion of the current decline in the

jobs ; for« economists >
in the Government.
> ^ V

by the

from the highest peak of

reasons for the current business downturn
and its probable extent, Mr. Zelomek comes
up with the con-

the

seemed harmless enough, just 4

a! few '

sailing in the clouds. Perhaps
why the current decline

seems

By. analyzing the

"of -these was {
national economic one

problems and worries, you get the the creation of a
impression from theJ conduct1 of council > which ' would
the politicians on
the .terrible
1

that- is

of Business
Administration, University of Virginia
--

proportions. But this is

the Leftists and

our

City

Visiting: Professor, Graduate School

■»>'-

early 194Q's

have been scaling the heights, and
we've become rather accustomed

•

ar'

Ahead of the News

series due 1978

•

;

issue and*his^^fellow Demo-

erats

right

following

are

behind

him,

some,

them

out in front.

Tlie

saying

are

ployment

will

with

be
if

November

and

their

talk there is

scare

keep
no

reason

ciated

with

ment.

Barringer had

amazing to

Richard W. Barringer

The Leftists made a de- peen Township
termined drive through a commit- Secretary
of ;

sharply and to estimate sales more
liberally when volume has ex¬
panded markedly and to increase
production facilities after a sharp
advance, than it is to convince
him that

that it

ending.

are

much

bottom

prime movers. Under worx.
their plan, the Government eachyear would size up the national
production .and how many jobs
this would create. If it would not
of the

Geo. E. Sozek Forms

ereate
was

enough

to add the

to the national

Own Investment Co.

Government

the

necessary

production.

amount

George
Geo.

Sozek

has

standing of commodities and industries. They have to if they are
to be successful. As a group they
have

in your

Union Securities & Co.
Kuhn, Loeb & Co.

The First Boston Corporation

Blyth & Co., Inc. "

.Dkexei. & Co.

Glore, Forgan & Co.

Harriman Ripley & Co.

Goldman, Sachs & Co.

Incorporated

arim is to' try to' provide
sbme background information
in
a
way that will be helpful.
By

analyzing'the 'reasons

for The

ciTr-

downturn in business and its

Merrill Lynch, Pierce, Fenner& Smith
r

■

♦An address by

Mr. Zelomek before

A*£nts Association of

Frt

at fsss!""'

Haven' Con" '

Lehman Brothers

Kidder, Peabody & Co.

♦

Stone&Webster Securities Corporation

quite realistic

formed

; A group of conservatives headed 40 Exchange Place, New York
by the late Senator Walter George City to act as brokers and dealers
got
together
and whipped
up in
investment
securities.
Mr.
legislation designed to head off Sozek was formerly co-manager
this Leftist scheme. They had to of
the trading 'department of

been

Eastman Dillon,

operations.

E. Sozek Co. with offices at

accept some of the propositions of Glokin & Co.

legally
States.

....

Copies of tlie Prospectus mr.y be obtained from such of the undersigned as may
offer these Securities in compliance with the securities laws of the respective

and

sensible

Radnor Township, be more liberal after liquidation,
tee headed by Senator Jim Murray, Delaware
County,. JPa., for. the whether it~is commodity prices,
the multimillionaire bleeding Past eight years, and previously securities, sales or production.,
heart of Montana, for a "planned had had extensive experience in .
The purchasing agents have an
economy." Walter Reuther was .governmental
and
accounting excellent knowledge and underone

PRICE 100.50% AND ACCRUED INTEREST

to find

liberally after markets have risen

Collings

be traced back to

can

businessmen

that it is much easier to encourage
the
businessman
to
buy
more

Prior to

mid-40's just as the war was

ent trouble

pres-

various services, con¬
work and special studies,
our

it is always

their Munici.pal
Depart-

and
Company, Mr.

our

advises hundreds

sulting

has

asso-

psychology as a basis for
forecasting. As one who

through

become

.joining

In this writer's mind

the

they

why it shouldn't be.
*

Richard

upward turn to .'Barringer

the contrary, Lyndon Johnson and
his fellow Democrats think unem-

study

15,1978

Economic

that

nounced

economists who

there will

.Fidellty^Phil-'-

along ^delphia Trusteven Building,^ an-

Due March

Dated March 15,1958

Smith, B arney & Co.
»

White,Weld&Cot

The Commercial and Financial Chronicle

(1156)

Electronic Equipment Sales
To Banking Industry
By WILLIAM G. DAMROTH

Electronics Shares

Vice-President, Nucleonics, Chemistry of

Explanation why banking has

to welcome automa-

more reason

tion at this time than most industries

conviction that banking has
reason
to
welcome
auto¬

our

than

most

indus-

tries.

For

time now

some

the

quirements.
Each

year

qualified
Win. G. Damrotk

and

clerks they do. get

higher—at

each year come

rate,: that

wage

cumulative 4% a
year. Meanwhile the long range
forecast
indicates
this
problem
will grow more acute. In this fore¬
moving

cast

workforce

electronic

working

companies have been
these requirements.

Now with

of this

much

equip¬
ment developed and beginning to
reach its market, the banking in¬
dustry is on its way to becoming
one of the largest single markets
for electronic companies. And the
major electronic companies are
well

the

are

others.

tion of America and

One

is shooting specifically
system for cooperative use
by smaller banks.
Out of this
work savings .bankers look for a
lowering of automation costs in
company

for

the future.
<

For

larger commercial " banks
of the completely auto¬
matic system for handling checks
is almost at hand.
In the system
the

the

checks

are

with

coded

magnetic ink visible to customers
and

operations of selecting the
right account card and feeding in

least and benefit landowner-farm operator more;
(3) agricul¬
ture's inability to reduce output during depressions

readable

struments.

electronic

in¬

The

banking industry
specified where the
coded information is to be placed
on checks but has yet to
specify
a standard type font for
encoding

already

tion

made last

was

Clifton

National

has

pletely

least

workable
of

industry

one

com¬

laboratory

electronic

bank

even

there,

doubt that it could

much

$500,000,000

little

.seems

amount to
over

the next

five to eight years.
The newly developed electronic

equipment for banks
small

from
low-priced

ranges

comparatively

machines for posting to

completely

automatic

systems for handling
savings and mortgage operations.
It also includes experimental de¬
mand

deposit

matic sorting,

totaling

systems

for

auto¬

listing, posting and

random-sized

checks.

Costs range from as low as $11,000
per

unit to upwards of $1,000,000

per

system.

Until recently electronic bank¬
ing equipment consisted almost
exclusively of book-keeping ma¬

chines and the purchase of
confined to upwards

these

was

hundred

the

larger

institu¬

tions.
Of

the

new

electronic

equip¬

ment the market for savings bank

automation

cording

systems

comprises

alone,

ac¬

manufacturer,
400 large banks, plus
one

The

In the expensive field

Company.

of computers this machine is rela¬
tively
cheap
at
approximately
$11,000.
Of course the average
small commercial bank requires

machine

operation

units.
Since last Spring, business. Even the
100,000 farms
1,155 Post-Tronic machines have which are classified in the census

been installed
in 38 states,

some

250 banks

the District of Colum¬

institutions

alert to the neces¬

are

sity for automation and anxious
to do something about it when
the

appropriate electronic equip¬

ment is available.

While electronic

equipment fre¬
quently ' poses
many
problems
wherever it may have application,
there is every indication that the
banking industry has carefully
prepared
for " automation.
For
among
large and small banks
alike there

to be

seems

that

sentiment

through

general
automa¬

tion the industry can perform old
tasks better and reach new levels
of

This

achievement.
could

ness

creating

have

a very

for electronic

electronic

the

receptive¬
effect

substantial market

banking equipment

faster

much

time

concerns

than

most

antici¬

have

pated.

Stralea Named Pres.'

Of US0 Feed of NY
Donald S. Stralem, a partner in
the

firm

Hallgarten

Co.,

investment

bankers,
has
been
elected President of USO Fund of
New

York,

year

Mr.
has

oratory

Poughkeepsie,

N. Y.,
bank-systems

was' built to
gain
experience. It posts current trans¬

actions

USO

service.

same

the

market

larger

limited

institutions.

100

he
a

Donald S. Stralem

(Special to The Financial Chronicle)

It is expected that these

automation

this

Short-Run Behavior

There

really

are

two

distinct

problems. ~ One «is

which

problem of the effects of the dis-

with agriculture
in the average size of the firm are
retailing and the service industries, and even here the income
per enterprise
is three or four
times what it is in agriculture.!
compares

short-run

the

tribution of monopoly and competition in behavior
,iess

run

during the busicycle. The other is the longproblem of the effects on the

broad

course

economic

prog-

The problem

of the relation of ress. Of these two problems the
the size of the firm to the nature first is the easiest to answer. The
the

market

which

faces

record

makes -it

clear

that argidifferently
nomics, both theoretically and em- from manufacturing industry over
pirically. We cannot assume off- the course of a business fluctuahand that just because a firm is tion, and especially in severe deof

one

the

small

most

there

difficult in

are

eco-

elements

culture

behaves

pressions.

very

A depression is charac-

monopoly in its market situation, terized
The village barber, the small specialized manufacturing concern

by a general decline - in
money income and in the money
value of output. This decline is

have an effective degree of fairly uniform, industry by inmonopoly. Nor is there a neces- dustry. That is to say, when the

may

sary connection between
size and monopoly power;

large money value of national income
about halved, as it did from 1929
large corporations are effectively to 1932, the money income of each
hemmed in by the competition of major industry likewise approxisimilar firms, of substitute prod- mately halves. The money income
many

ucts, and by the pressures of publie opinion and government regulation.
have

Nevertheless,

where

situation with small firms

producing
standard

for

the

national market, as

part

most

commodity

for
we

nil,

and

industry

however is the
value of its annual prod-,
net, and this in turn is equal to the
an

money

quantity of product multiplied by
its price. If wheat farmers for in-

large stance produce 500 million bushels

do in

agriculture,

com-

can

feel

0f wheat in

year, and sell it at
price of $2.00 per
bushel, the value of their product,
an.

average

and

therefore

their

gross

money

here

that

economy

money

people, the least subject to jnC0me is brought about by

the wretched

spirit of monopoly

(The

of Nations, Modern whiie

Wealth

cline

employment

prices

stay

and

de-

output,
decline

Library Edition, p. 428), but the

much less.

most jaundiced anti-agrarian can-

the reason for this difference lies

There is

doubt that

not

might economically
utilize the
system through cooperative pur¬
sees

Forces welfare

detects

complete assembly lines

Another manufacturer

answers

v'-wY-'*

still smaller. The only

course,

One wishes there

nice, simple

these questions.

deny that of all people,/farm- in the c|ifferent market structures:
overdrafts, certificate
$ of
ers have the least
stop payments, holds or any other commendation
opportunity for
agrjcuitural markets unsalable
required data.
It handles checks
monopoly. Indeen, I am aware of st0cks of goods
from the Navy in 1943 for con¬
produce an almost
code-inscribed in magnetic ink.
only one agricultural product in immediate downward pressure on
tributing to the welfare of its
The actual system that IBM will
which there has been any really
the price. in the markets for inpersonnel.
market will substitute the specifi¬
successful exercise
of monopoly
ciustrial goods unsalable stocks of
USO Fund of New York seeks
cations of the banking
power: this is the California lemon,
industry
g00^s produce not so much a fall
to
raise $1,600,000 during
1958. where a
for the code on its
relatively small number jn the price as a cutback in outexperimental
model. This prototype as well as The money will be used to sup¬ of growers, concentrated in one
put anct employment. These difothers like it such as the "Elec¬ port USO clubs and entertainment area and protected by climate and
ferent market structures are again
troupes
serving
United
States the tariff have succeeded m ortronic
Recording
Machine-Ac¬
reiated to the size of the firm in
forces
throughout
the
counting" developed by the Stan¬ military
ganizing themselves sufficiently to
pr0portion to the total output of
ford Research Institute for the world.
exert a true monopolistic control
product; if an individual wheat
Bank
In addition to his USO activi¬ over the output and price of
of
America will cost as
farmer reduces his output this will
much or more than the
ties,
Mr.
Stralem
serves
as
Chair¬
lemons.
expensive
have no perceptible effect on the
automatic
systems
now
being man on. the National Travelers
In this,
however, an occasion price of wheat; if a manufacturer
Aid Association Executive Com¬
built for the savings banks.
for rejoicing, that in the midst of of some
specialized and brandmittee.
He also
is President of
so many who have bowed the knee named
article cuts back his outSolve Personnel Scarcity
Shelter Rock Foundation, Inc., and
to the Baal of monopoly there1 are put,
he can maintain his price
For the large commercial banks Board Chairman of George Junior the faithful remnant who
preserve without difficulty in the face of
'
automation of this kind is ex-v Republic.
l(he practice, if not the faith, of falling money demand,
pected to provide a solution to the
competition in its purest form on
An
problems of personnel shortages,
which our society supposedly rests,
Continued on page 40
Now With Bache & Co.
labor-turnover and broadening of
or it (is an occasion for lamenting
1 Income
per enterprise
(1950 census)
and

several thousand small banks that

chase.

of government?
were some

other large areas of economic life

of all

Armed--

activities,

•

is one income, is $1,000 million dollars. 1
where the
jn agriculture a decline in
economists
beau ideal of perfect
money
income is brought about
competition is found.
One may almost
wholly by a decline in the
hesitate to claim with Adam Smith
prices of agricultural produce. In
that' "Country
Gentlemen and
manufacturing industry by confarmerS' are, to dheil?< great honor*
trast much of the decline in

received

and the three or
four million'"family farms" are,

tic defenses of thesest of the economy,
and who, therefore, merit
the special protection and support

company,

place in the

associated
with

medium sized manufactur-

cally

the New York

City

ing

tiny compared with

nopoly in this situation is practi-

Committee for

even

are

confident that the element of mo-

Stralem

served

"large"

mercial

for the
1958.

Inc.,

de¬

preventing depressions.
Agriculture is rightly regarded
as
the last great area of
small

several

test

IBM's Product Development Lab¬

mends

Trust

'estimates of the size of this bank-' posit system .is. already developed. the
past two
by-u-a -major i electronic concern,'
years.
Long
ing
market
vary
considerably.

But

agricultural productivity disadvantaging the farmer. Recom¬
improving farmer's relative position not by reducing
agricultural output but by increasing industrial output and

Spring at the

Bank

;

exploits
society, and (4) paradox in increased

the farmer for rest of

The first "Post-Tronic" installa¬

use.

model

electronic

not

the amount of the check.

day

Meanwhile

Sees $500,000,000 Sales in 8 Years
Within

them

It also

change. Observes: (1) agricultural policy constantly tends to
become a "charity racket"; (2) subsidies aid poorer farmers

does

■

stops * and
eliminate the

over-drafts,
It

Chairman

of this.

aware

savings

meet

the
Laboratory for Electronics, Inter¬
national Business Machines Corp.,
Burroughs Corp., Radio Corpora¬

workers.

As a consequence the banking
industry today is ready and has
been waiting for the kind of electronic equipment it must have at
a price it can afford to pay.
And
for some years past
the major

also

concerns

bank needs. Among

increase
rapidly as population. To ex¬
perts in the banking field auto¬
mation of typical operations seem
to offer the only possible alterna¬
tive
to
the
problems of more
bookkeeping,
relentless
wage
fewer

working

are

and

electronic

other

whole is not expected to

inflation

third

They are the product of Teleregister Corporation.
A number

nation's

the

and

second

system are to be delivered sub¬
sequently to the Union Dime Sav¬
ings Bank in New York and the
Society of Savings, in Hartford.

What

accounts.

Newark.

offer¬
more and more services to get
are

balance.

Boulding analyzes how prevalence of small farming

against large business and labor units, affect agri¬
culture's relative earnings and ability to adjust to economic

casts—and

line,

new

bia, Canada and Alaska. Such
rapid and broad acceptance would
indicate that the smaller banking

The first such system—designed
specifically to handle savings and
mortgage operations—is scheduled
for delivery later in the year to
Howard
Savings
Institution in

and harder to

yet
ing

C.'v&C.

'•

ing it harder
get

Sale of Automated Systems

banks are find¬

workers

correct

Economist

units,

manual

ciations.

time

the

detects

manpower re¬

mation at this

Department of Economics

University of Michigan, Ann Arbor, Mich.

takes

holds.

banking
industry
has
been studying
the problem of

machine

check, posts the new amount

verifies—the

present prices from $1,000,000 to
$2,000,000. They are custom built
and vary in price according to
specifications. Ultimately the mar¬
ket for either fully or partially
automated systems of this kind
is to be found among the nation's
500 savings banks, 12,000 commer¬
cial banks with savings accounts,
and 6,000 savings and loan asso¬

National's

the

Attractive Place

By DR. KENNETH E. BOULDING*

"Post-Tronic". This machine

clerks.

system is quite sizable as savings
bank systems of this type cost at

Thursday, March 13, 1953

For Small Commercial Farmer

designed for posting—an oper¬
ation that usually requires two

either estimate the market for this

studies of the impact of
on
various fields, it

our

electronics

Finding

special machines "less automated"
and much less expensive are be¬
ing made available. The first of
these was placed on the market
last year by the National Cash
Register Company under the trade
is

by Mr.
Damroth. Now that equipment is coming within price reach,
the writer predicts sales to banks may amount to $500,000,000
in next five to eight years. Discusses receptiveness of different
types of banking to partially or fully automated systems and
firms catering to such demand.

sight for the medium-sized and

small commercial banks. For them

name

is pointed out

units

will

check

ready

for installation about two
years
after final technical
specifications

by the banking industry.
This sort of equipment

KANSAS

Lacy has become affiliated with

out

ful

injustice involved to the faith-

remnant, who do not,

was

formerly

Upham & Co.

with

Harris,
\

the

icy.

?.'*

Dr. Boulding before
Subcommittee on
Agricultural PolJoint Economic Committee, Washstatement

ington, D. C.

was

$2,521

agriculture,

Imob

cannot

avail themselves of the monopolis1

Bache & Co., 1000 Baltimore Ave.
He

the

CITY, Mo.—Robert E.

„„„„

$7,846 in

re-

in service indus-

"ec^ur«f
excluded.
terprise

By comparison, income per enwas
$49,179
in
mining
and
quarrying, and $83,149 in manufacturing,
(See Ronald H. Mighell, American Agri-

culture,

47.)

Volume 187

Number 5724

The Commercial and Financial Chronicle

...

(1157)

to the profit

Television and Big Business

both

increasingly
tough competition better than they
could

By ROBERT C. TAIT*
A

Buick

withdrawal from TV production,

Stromberg-

Carlson head relates this to natural advantages of

big business

and realization that

distribution.

that

model

was

/'Pregnant

the

re-

Cow"

middle

30's

terrible

flop. Also the
Desoto.
These

bug model
just didn t go over in those
days, and had they been separate
companies rather than divisions of
cars

TV field will be

big strong businesses, they would

those with full line of white

goods and appliances who can
control distribution right down through the dealers.
Poses
problem of large firm's selective investment of funds for

have

broke.

gone

Get

Thus

research with greatest

potentialities for earnings, and limited
and limited funds in many small businesses.

choice

the

Get Out

decision with

our

to the television business

had to

was

Someone

wrote

tract

New York

Central, are now talk¬
the subject "Bigness Is Badness Is ing about merging. This may take
Bunk," but I have been unable to years of hearings and negotiations
run it down..
The title still sticks but I believe it will ultimately
in my

once

mind, however, because the

truth of that title is

ing

daily becom¬

evident.

that
so

One of the best

defenses of big
business that I have ever seen was

the

series

articles

written

can

the

because

off

come

effected

economies

by both

are

great.
It

commonplace to mention
automobile companies as the

our

Collier's

for

time head

Atomic

the

Commission

and

Energy as highly competitive as the auto¬
Nqw Dealer— motive. You have got to be big in

Which makes Llllenthal's conclu¬
sions all the more powerful, be¬
will all recall how the

cause you

New

Dealers

used

shoot

con¬

this business to stay

alive at all.

Explains Withdrawal From TV
Which leads

to digress a mo¬

ment to recount our owft

politically the order of the day to

our

attack big business, or even busi¬

itself,

ness

though business has

unholy

some

taint

unsavory

that distinguishes it .from agricul¬
ture

professions.':Actually,

the

realize
simply coiildn't have

nearly, everyone.' must

now,

present economy in our free

pur

enterprise system without business

—and, in fact,' without big busi¬
ness.'",.',..! ;\

■

; > ■

Mr. Lilienthal

points out in that

series of articles

the absolute

re¬

quirement". of bigness in-some of
major industries such

our

steel,

where U. S. Steel spokesmen

have

expeil-;

in the television business and

ence

decision to get out.

The gen¬

scrap

you

that

J*1© P?cket-

mated effect

S^ +an

Tas

^^K?jr^.na-f10^ S
s;

can

capital investments that" give
promise of the largest Teturn on
the
investment, and ' those with

the

domg

nation

spending

return

some-

get back to Mr. Lilenthal's
articles, they also pointed out that

simply

and

couldn't

either

won

big businesses
hattan

our

vital

evidenced

nfh„,.

|{ f,

A. T. &

holn*'

few

vears

their

nn 1

T„ with its Western Elec' Bell Xabs
(also since

that man-

nMr

nlLJw thrniJh

bulk ot this.

prospect

most distant net

investment

are

rejected.

I have allcady

rnGHtioncd

*s ,5® time and

should

'from

come

have

not

small

ones.

Despite

many

,11 would be

successful

need.'-'

- big
businesses have
big:. from ? within rather

most

be like the cliche about going ers,
Honolulu: "Take half

clothcs and twice as-much money
F
you think you are >,oing to

re-

that

business, or that small business is
not good in itself; nor that we
should not guard against the posr
sible abuses of big businesses. As
a
matter of r fact, big businesses
all the hysterical talk about merg¬

rniirod for us
11c to win i+ia war
quiied-lor
towin the wai.

were

money necessary to launch a new

nnmnonine

that

all this argument in favor
of bigness I do not mean to imply
By

tVr ^hnt

^b © ©n

improve over-all earn¬
as against the limited choice
limited funds in many small

businesses.

mentioned some. of the products

the Justice■ Depart-*

projects

and

uCXV- product® *nd

to
vast

ings

th§

irati-^^jJ^S?Ul<Another

Union rarbido

oniir

the

is bound to

b*eb;ood of our progress, through

ptojects..
for

and

hauled in by

t «1
\ lTv

?n?n

by hauling them into court

for beiru? too

*qu; 11

to the Man-

ask

(although

later they
tude

came

thev

Pont

without

war

other

and

did

have /waged

narticularlv World

War II. When it
who

promise

This selective investment of funds

smallest

of the smallest

/o*
O^r

earnings. Priority

?1CJ
retail

is going to be given those projects

smaller proportion of the to-

behind your

arm

requests for money than
available, by quite
naturally - approving the appro¬
priations in order of their esti¬
there is money

•

things;

economically),

It isn't
stay in with one

S?! lrov?d bad.Poli{je^pry b°usewife who
fS
®

„

other companies
full line that we could

get out.

industry,

with

sell and service

trie

big , business.. As a
matter of fact, it still seems to be
tinually

affiliate

develop

back.'

prime example of bigness in busi¬
Magazine (now ness,
and
of
course
everyone
defunct, and incidentally a pretty knows we couldn't have the cars
good illustration of the mortality we have at the prices we pay ex¬
of even large financially strong
cept through mass production. As
companies
in
today's
business for. competition (about which I
world). These articles were writ¬ will have more to discuss) there
ten by David Lilienthal, the one¬ are few industries in the country
1952

ments, in

growing and dynamic
that run way beyond
what you can actually get your
can separately.
'
hands on—so what happens?
All
The A & P story is one with divisions present their appropria¬
which you are all familiar, • The tion requests, and in the case of
Giant Killers really bit off some¬ our company they are considered
thing when they went after the by two boards, first the Board of
A & P, because the essence of the Management and then the official
complaint was that they were so Board of Directors. - These boards
big they could undersell the little resolve the problem of having

get in with both fists and
slug it out (by that I mean merge
Or

of the other

combined company than they

as a

either
-

some

highly specialized steel companies

respect

of two

one

with different products in differ- funds, By that I mean there are
ent markets to the extent that they always capital requirements, re¬
can more effectively compete with search and
development require¬
U. S. Steel and

generation will

first

problem of TV is not manufacturing but

Mr. Tait predicts survivors in

member

Division of General Dynamics Corporation

recounting

otherwise.

All

President, Stromberg-Carlson Company

of both, and in fact

weather the

can

grown <>

than arrived there via the merger
route. -Only
a
relatively - small

the development and portion of the
total growth of
marketing of a- new - American industry has come, froni
product the thing just won't get' -mergers;, so I say more power to
namics following our merger with
0ff the ground» as soon as you the small businesses set that they
them at the end of June, 1955. Ac¬
businesses welkas the po- think, and it will surely take twice can grow big. But let's recognize
tually, our plans .with respect to
tential or actual dangers or abuses. as much
money as you first esti- that bigness :per se is not bad.'
this were all revealed to General
It has been well established by mate.'
The period oUtestation is C Somewhere I read, recently that
Dynamics in our first conversation
many,studies that bigness is the elephantine.i It sometimes takes the government is busily -3ubsidiz->
on the subject of possible mergerk
natural result of our competitive
five, six, seven years of losses be- ing small, business so 'that it can
Reasons for our withdrawal from
society. In. fact, competition is the-.fore you turn the corner and get grow big ^enough to be attacked
the television field were written
biggest reason for bigness, and it a new product in the black; I un- for-being
big.;-" ■
out, after a lot of blood, sweat and
has also been well established that derstand it
took seven years in the
tears, in August, 1952, but it took
competition almost always in- case 0f nylon. Who but a big cornus 4V3 years, to accomplish this at
creases rather than decreases as a
Dane A. Pearson f
pany- could stand .this?. In fact,
a time when we could do it with
result of bigness. Of course, each most
-big manufacturers continu- :
increased rather than decreased
y .Dane Appleton Pearson passed
industry must be examined sepa- ally have a few items that are
away March 3rd at "the age of 87
earnings and employment. We had
iately because the factors are dif-r working themselves out of the red.
to reverse our field once when we
following a long illnessr Prior to
ferent, but
speaking of the

probably .thinks

eral-public

the decision

was

this
Dy¬

of General

good-idea for some
Congressional inquiries to
investigate the beneficial results
of big

our

had almost gotten Out of the busi¬

because

couldn't

quite
said, "Size is our greatest single
see our way out to complete the
functional asset."
The oil indus¬
job at that earlier date. We finally
try could not possibly. create the got out of. the TV business the
winter and early spring of 1956.
gasoline for our cars and planes,
ness,

I am
great majority of. industries.
and

large,

creased

big

rather

competition.

than

This is to insure

increased

mar-

By ket jn the future.. Big businesses
in- wfn absorb heavy losses if they
decreased can see
profits somewhere down

industry

has

To be better able to

maTr1^forTortm^cersrii

his

retirement " he

years
ness

had Tor

many

been in the investment busi¬

in Wall Street.

the road
>

: Another factor that should be

Joins Clark Staff

; (Siieolal ta Tin; Financiai. Chronicle)
"
mentioned here
before
I" get
part £?JLf+h*?lhn Ti~+hi'nh*'rn
of the reasoning behind this de¬ Younvstown merger makes sense
through,
and
thatT
think
.accounts
DENVER/
Colo.
—Marie
C.
other myriad petroleum products
cision, because it has a bearing on Md that It will
Sexton has joined the . staff of
in anything but huge refineries. In
power of some of our big busithis whole question of bigness. It
Phillip J. Clark, 817; 17th. Street.,
mitted, because I think they can
fact, only great, financially strong seemed clear even in- '52 that prove to tne Justice Department nesses, despite fierce competition, Miss Sexton was Tormerly with
oil companies can afford to ex¬ competition and increased size by that they complement one another is
;
the selective application of Amos C. Sudler & Co.
merger and natural growth would
plore the world for new oil re¬
gradually narrow the field down
sources at anything like the pace
to a few big producers.
The TV
we do, and in so doing, inciden¬ business, like so many other con*
This announcement is neither an offer to sell nor a solicitation of an offer to buy any of these securities,
sumer
products,!) is a problem in
tally. keep on increasing our total
The offering is madk only by the Prospectus.
distribution rather than manufac¬
oil and gas reserves despite our
£ i
turing. Anybody can hire a few
NEW ISSUE
«
* \
o
"
March 12,1958
fantastic annual consumption of
engineers, set up a line to produce
oil.
radio and TV sets, but it's selling
112,500 Shares
:
The chemical industry is an¬ them that takes the real doing—
and here size is all important. Ac¬
other where huge quantity pro¬
tually the long-range survivors in
duction is a requirement in order
this field are going to be the ones
to achieve low prices. We couldn't with full lines of white
goods

let alone, the fuel oil and all the

sponsored

there

doubt that wired TV

disease

boost

dustry

for manned aircraft have declined

valuable tool in the classroom and

two
dis¬
appointing to date, but the fourth
quarter of 1958 might see a good
for the last
TV has been

sales

Color

home.

the

spending.

purposes

both, the electronics in¬
must, and I believe will,

poses, or

1958,

crease

in many

tection

clining

the

barely

serves

gear

*An

problematical,

durables which have suffered de¬

years.

uses,

enter¬

surance

military

pany-sponsored

(from
While the future of the latter/is" around $4 billion to less than $2

consumer, to

medium

tainment

challenge to help

rising from
to $3.5 billion.

Annual

re¬

industrial

and

its debut

yet, the market potential has been

1957,

Sizable

see

made

both in

1957,

This last

record

rose

sales

educational
and

advances

components.

electronics
sales

will

rapid

made

challenge and

review
a

good reason

television

Closed-circuit

spending

and
appliances
larger increments

Electronics

Prudential In¬
Company, predicts, an inT

published

tremendous this past year and, as

fields. '

To
was

for

The Business Forecast for

for Closed-Circuit TV

militaryelectronic

products,

category actually
three

1955

1958

for

Boon

industrial

consumer

equipment,
items

ever

that

surgence

involves at least four major fields

autos

1958, there is

of growth in

great period

West,

the

from

due

With the payoff

year.

accruing in

year

the

actually

excellent

systems.

Growth After World War

amazingly accu¬
therefore, it appears

and,

that

increase

healthy

very

sales at re¬
million TV re¬

for

traffic

central point.

Future

22 manufacturers in the

year,

had

the painful process of

according has become a somewhat more
to Brigadier General Ben I. Funk, stable business this year and per¬
Deputy Director for Ballistic Mis¬ haps that means more horse sense
siles, USAF, Southern California will be used by the people in it.
Last

chemicals.

from

control

and

coordinate

Summary
Nineteen

fifty-seven total in¬
dustry sales equaled about $7 bil-

Number 5724

Volume 187

The Commercial and Financial Chronicle

...

(1163)

lion in the various fields of mili¬

industrial,

tary,

dicate

1958 sales in¬
increase of 8% to 10%

that

uted

total, fairly well distrib¬
the several groups, but

!\vith

edge to military equip¬

over

ment.

into

the universe. A

yfet

ing

missile

bright

becomes

^ the v/orld

and the greater

our talents for peaceful
in future years.

mint

engendering-

gold

would

pru^

use

LONDON, Eng.—Most of

cause

the

recall in

strange

scare'1

*"v'

large

ber

had

Blyth.&

;:Co.,Mnc. offered for public sale
(March

pre-

ferred stock, 4%% series, $100 par
:

scare"

five,

Inflationary

have

Needless

to-

say,

Be
-

Exch.,

it has been

an¬

nounced. He is

Manager

the U. S. Gov¬

ernment, Fed¬
eral
Agencies
and
Equip¬
ment

Trust

C ertificates

Department.

the
recession.
In
that case the
Mr.
Leroy
United States authorities would be
joined Union
in a position to arrest the inverted'
Securities

Eastman

the New York

mere an¬

Securities

&
Co.,
Street, New York City,

members

would -be

highly satisfactory if the

Leroy has been ad¬
partner

Union

Broad

Stock

the

Dillon,

face

to' ticipation of an increase in the
-l gold price were sufficient to check

Devaluation Would

mitted

wage-price infla¬
tionary spiral. An increase in the
dollar price of gold would greatly
aggravate that problem.

num-;
,

will

countries

once

recession

„

Even if inflation fears

New Partners
Charles V.

overshadowed, for the
being, by deflation fears, the

trial

Doubts

"gold

by far the
of the

was

problem

—

"gold

scare"

by producing con¬
evidence of their deter¬

vincing

Cnunes

Corporation in

jl.eroy

Nov.

1938; the
present company merged with Eastman,
gold price. Once the recession is" Dillon & Co. in
September, 1956.
ended it would become possible to *
Previously, MY Leroy was associ¬
journalists,in¬ than merely arresting the present concentrate again on the problem
ated with J. & W. Seligman & Co.
vestors—got it recession. There might not be an of inflation. In the absence of an *
and with Hallgarten & Co.
i n to
thei
immediate expansion of credit as increase in the price of gold its
In
addition, Willis L. Roberts
heads that the a result of
increasing the gold re¬ solution would be no more diffi-"
has been admitted as a. partner
United
States'' serves through their revaluation. cult
than
it
would
have
been
in the Chicago office of Eastman,
Government!' But the psychological effect of before the
"gold scare."
Dillon, Union Securities & Co.
intended ; to,, making such an expansion possi¬
mination to

maintain the

130,000

12)

cumulative

new

the

Eastman Dillon Admits

basie position has remained un¬
changed. Once the present reces¬
sion has spent its force the indus¬

Beyond doubt, ; an increase in
econ
omists; the-;dollar price ^of gold would
Stock
Ex-; produce inflationary effects. And
change opera-/ it. is probable that these effects
tors, bankers,> would -go
considerably
further

Offers Underwritten

inverted

whether

been

time

gift to U. S. S. R.

that ; the

people

the

over

An underwriting group headed
jointly by Morgan Stanley & Co.,

have

recent years) would obviate the need for drastic

t;.

yesterday

free

economic

free world.

devaluation

be price inflationary.

I Cincinnati Gas & El.

gravest

grounds that raising

of the "gold; actiqn toibring
During that year an end. V

purposes

W. E. Hutton & Co., and

the

memory

1937.

continents

■'

Hopes

recovery.

than that

pros-

sincerely hope, it ; also portends
Victory in the Cold War, peace in

;

again

rumor

whether Americans would make

jjpects for business expansion in
^Southern California in 1958. I
,

work

the

will win it. The

presents

era

the former year and

frightening sound,
promising one.
The race
has begun and, speakfor the electronics industry,
we

points out how over-delayed disclaimer aided the economy in
ponders whether this might, in reverse,

history, but they

-I'm confident

asked

excessive inflation

into space

►

leading monetary economists compares false
gold price appreciation rumor during U. S. A. boom recovery
of 1937 with current gold devaluation rumor.
Dr. Einzig

be heard echoing through

can

By PAUL EINZIG

•

well be

may

the world is really in need of such
a
dose of inflation.
Until a few
months ago everybody agreed that

One of world's

beeps of Sputnik I and II

have faded

'still

i-'Vf A-'-r;'"

;

The
r

"Gold Scare" in 19S8

and

products.

consumer

„

component

lower the offi¬

Value, of The Cincinnati Gas &
Electric Co., priced at $100 per

ble5 would

Free Gift to

considerable.: SUch;

has

Soviet

with

associated

been

the

firm for 10 years, having joined
by no means certain, how¬
the predecessor firm of Eastman,
share to yield 4.75%.
price of gold( revaluation: of gold reserves in ever, whether the psychological
Dillon & Co. in 1948 as a sales
Concurrently, the company is from the figure of $35 fixed three- terms of dollars would increase weapon of the "gold scare" will be *
issuing to the holders of its com¬ years earlier. %By 1937 there ap-; the safety margins of these re¬ as effective in 1958 as in 1937. In representative.
' '
"
* r' *'•
}
the meantime Soviet gold produc¬
mon stock rights to subscribe
over
mininum
at peare.d to.be indications of boom- serves
require¬
$28.50 per share for 450,923 shares like developments, and the Wash-, ments:- 'The result would .be a' tion has assumed considerable im- •
Form A. A. A. Sees.
'of additional common stock, at:the ington authorities were',credited) relaxation of
disinflationary meas¬ parlance as a factor influencing ■
(Special to The Financial Chronicle)
the ". intention
of
rate
of one
share
for
each
16 with
checking ures which were taken under the the attitude of the United States
It
ATLANTA, Ga.—A. A. A. Se¬
Bhares held of record at the close them, by^mearisliof* lowering the influence of the decline of the. authorities.
seems
doubtful
of
business on March
' ; ;> • '"
' • gold and foreign exchange re-" whether many people would se¬ curities Company Inc. has been
11, 1958. gold- price. ;: -.

Paul

Einzig

cial

buying, effects

would

be worldwide.

It is

The

•

The

subscription offer, which is
being underwritten by the same
group of investment firms,
will
expire at 3:30 p.m. (New York
time) March 26, 1958.
>v ■
j
\ *■ Proceeds from the - sale of the
new preferred stock and the ad¬

^'Although

the

Washington

serves.

au¬

for

riously expect

the

United

States

formed with

offices at

1066 Gor¬

don Street, Southwest to engage
gift'
in a securities business.
Officers
as
it would become profitable to to the Soviet Union by raising the
are J. W. Pierce, President;
and
work seams which are at present official American price of gold.
Mrs. J. W. Pierce, Secretary.
unprofitable. There would be an

The gold output would

thorities themselves did not initi¬
ate : these rumors, they abstained

Governmeht

increase,

long time from discouraging
effectively. Indeed they wel¬
them, because they hoped increase in the export of Soviet
that-the damping effect
of vthe gold, attracted by the higher dol¬
ditional shares of common stock rumors would
Private hoarders, too,
obviate the need lar price.
!
will be applied to the construction for
taking active steps to check anv would be tempted to take their
program 1 of the utility company unwanted boom. They must have- profits by de-hoarding, as they
dnd to payment: of outstanding been inspired by Bernard Shaw's did during the 'thirties as a result
bank loans of $7,299,333.
character, Captain Chotover, who of the increase in the price of
a

them

comed

make

free

Empire Underwriters

C. W. Geisel Co.

(Special to The Financial Chronicle)

been

formed

with

offices

Opens

(Special to The Financial Ciironicle)

ATLANTA, Ga. — Empire Un¬
derwriters Corporation, Inc. has

LOS

the

Geisel

ANGELES,
has

Calif.—C.

formed

W.' Geisel

offices

618

; According to the company's pro-

sought to enforce discipline on his
construction spending will ship without resorting to flogging,
i amount to
approximately $30,777,- by spreading about himself the;
J©00 in 1958.
Of this total, $25,- rumor that he had sold his soul to
'
720,000 will be for electric facili- the devil, thereby inspiring the
'ties, $4,784,000 for gas plant and required degree of terror among

gold.

gram,

•

the balance for

plant,
)

The

'
its

(

company

and

iaries supply electric

natural-gas

and other his

common

and
located

energy

area,

principally in southwestern' Ohio
and

•

northern

Kentucky with a
population : of
about ; 1,300,000.
Principal communities served in¬
clude Cincinnati, Middletown and
Norwood in Ohio,*.and Covington
and Newport in Kentucky. In ad¬
dition, tthe company supplies the
entire - electric", energy
require-.
ments of the municipal electric
systems in seven smaller communities, and sells some energy to

electric

municipal

the

system

Hamilton, Ohio. The company also
supplies the requirements of Ham-

ilton's. municipal gas distribution

gystem.

" '
•
i
■ '
For the year ended Dec. 31,
1957, the company reported total
operating revenues of $120,809,000
and
net income after
preferred
dividends of $14,477,000, compared

;•
:

;

subsid¬

crew.

'•;.■>

*
-

Stockbrokers
.the

were

this

has

a n

initiators

made

omists,

some

Ward Named Director
..

Francis

Ward,-

partner

the

and.bankers, too,

justification for

price of gold.

.•Morgan Stanley & Company, has
been
-

Yale

elected
&

Towne

director

The

Manufacturing

Company.

the revaluation
would

gold. All

inflationary.

are

Building

securities
Thomas

President

Sr.,

and

Co.

with

Spring Street to

engage

Thompson,

curities business.

Mr. Geisel, who

Treasurer;

Pacific

dent;

was

Cannon,

Secre¬

se¬

has acquired a membership in the

Harry R. Churchwell, Vice-Presi¬
and

South

business.

Coast

Stock

Exchange,

formerly with Noble, Tulk &

Co.

tary.

Columbus and Southern Ohio Electric Co.
reports:

"gold,

Another year of progress

discov¬

theoretical

was

econ¬

After

Stock

Exchanges

while

disclaimers

tamper with the

brought
United

ceeded

about
States
in

offi-

intention
price of gold V

any

a
-.

their

;

long-overdue

recovery.;
authorities :
intention

confined

revival

forecasts

for

which

they

new

investment

now stands at $229,000,000 - more than double our 1950
figure. Last year's record growth, in every phase of operations, resulted
in increased revenues, wages
RESULTS

and earnings.
Year Ended

OPERATIONS

can

(000)

•

$44,305,821

$41,678,123

•

•••••«

•

Operating Income

Gross Income

•

34,121,566

32,676,011

$10,184,255

$ 9,002,112

$10,457,628

$ 9,355,804

$ 3,975,674

$ 2,912,945

•••

•

Income Deductions

Interest and other
Interest charged to construction

(credit*)

Earnings

......

Dividends

Earnings

•

2,074,282

•

Preferred

2,162,828

Operating Revenues

•

1956

•

Operating Expenses

Net income

ac¬

responsible, in the hope-

KWH Sales

'Ibtal

Possibly the United States.
authorities, with the experience of
1937 in mind, welcome the rumors.
not be held

invested in

1957

tivity.

and

an all-time high. A total of
equipment and a $60,000,000 budget
established for continued expansion during the next three
years. Plant
was

December 31

in-,,.

demand

business

1957, construction activity reached

The

gold and gold mining shares. it
is widely assumed that,;
the movement gather mo-',
mentum, it would
affect StockExchanges in general and it mighta

progressive area!

suc¬

But-

$31,450,000

downward,,

•
,

business activity took

Thereupon

most

began to affect.^
in general, and

course.:

cial

Ohio's

cut in the dollar/=

Instead of guiding

public opinion, they were guided
by it. Nor did the scare confine-b
itself to gold and mining equities.,-V

lead

speculators

progress,

that' there."

ered

should

Officers

bookkeeping increase resulting

from

gold and from gold mining shares.

holders of record April

15.

monetary gold, in addition

the

Guarantee

engage

scare.", But after the flight from

for

company

Mortgage

substan¬

Origin of 1937 Gold Price Scare

declared a
quarterly dividend of 37% cents
per share payable May 15, 1958 to
the

tial increase in the physical stocks

fluencing the business cycle by,
development .of a..,
with $114,403,000. and $14,214,000, allowing the
r
"gold scare" and then stopping it %
respectively, in 1956.
at the right moment.
1 *
V
The company has paid dividends
Is history now repeating itself: '*
in varying amounts on its common
'stock.'without
interruption
in in. an inverted sense? Since the v.
every year since 1853, and has one beginning of 1958 there has been "
of the longest unbroken records a great deal of speculation aboutof dividend payments of any com- the possibility of an increase in*
;pany
listed on the New York the official American selling price.'»
Stock
Exchange. On March 10, of gold. So far its effect has been '.
.1958,

There would be

....

on common

$ 2,575,486

$ 7,794,026

$ 6,780,318

970,491

859,824

$ 6,823,535

$ 5,920,494

$2.57

2,651,360

337,459*

$ 2,663,602

outstanding

per common

Common Shares

1,312,072*

•

$2.23

2,651,360

THE COLUMBUS AND SOUTHERN OHIO ELECTRIC COMPANY
215 North Front Street

•

Columbus, Ohio

The Commercial and Financial Chronicle

(1164)

nize

Illness ol and Cure (or
SYMES*

Presents

situation.

the

six proposals to

were

week

before

to testify
subcommittee.*

13th

January
Senate

Specifically,
we were

asked

to submit for¬

mal

answers

that

here.

I must,

testimony

of our

part

however, assure you
tiling about our testimony

one

We made clear that
logical and final outcome of
treatment, if it is persisted

that point.

the
such

in, is Government ownership and
control—first of the railroads and

transport.
tion
"What
I
imagine you are, and with
shall
we
do reason, as frightened of that as
about the rail¬ we are—for you know what you
roads?"
as shippers would have to expect
Our
testi¬ with Government operation. Com¬
the

^V? '

\-M

ques¬

mony

of the rest of

then

few

the

which

would

petition for your business

Railway

one

nation's

the

able

was

carriers

show

fairly

Pennsylvania lost
services was lost

the

passenger

handling mail.

Office should take

facilities

matters

the Rail¬

Agency by buying
equipment.
As

Express

way

its

over

and

stand,

the

railroads

are

being compelled to lose money on
both

services

without

the

public

getting the good package-shipping
it

service

should

have.

should be given
establish fares and

(3) Railroads
authority

as a good
railroad issue and was
sold before the latest drop in the

price for

well maintained

discount
serve

the like

1957

weather

brought
which

month

because

conditions

which

almost

and

snows

service should
be limited to very small packages
of true mail type,
or the
Post
(2) Parcel Post

general this is regarded

ary,

from

$54,700,000
view

run

Southern

earnings in Janu¬
despite higher wage costs and
(1) The Government should
a
slight drop in gross operating
allow the railroads full cost, plus
revenues.
February,
of
course,
a
reasonable profit, for handling
probably will show a large decline
mail.
In 1956, $10,600,000 of the

consolidation.

ment, and advocates rail
dozen railroad men
called
to
Washington the

couple

I'll

correcting it.

for

Railway

of that situation

none

sure

through them quickly:

illness, discusses feasibility of a government leasing arrange¬

Southern

competitors.

gested

the railroads'

cure

Railroad Securities

Meanwhile, Govern¬
spending vast

is any news to you. What may be
new
is the 6-point program sug¬

final outcome unless Congress corrects

our

sums up

with nationalization

when it
services

sums
of money
to enlarge and
modernize the facilities available

rail industry's testimony recently presented
to Congress. States industry envisages dangerously weakened
condition persisting, even with the return of business recovery,
Symes

performing

essential but cannot be

ment at all levels is

President, The Pennsylvania Railroad

Mr.

handicaps

to
are

made to pay.

Industry

$ The Railroad
By J. M.

than

comes

which

Thursday, March 13, 1958

right to receive assistance

our

rather

cold

unprecedented
the

hampered

territory,

both

railroad

operations and manufacturing ac¬
tivity.
January
gross
revenues
amounted

$23,100,667,

com¬

rate

the Federal Re¬

Board.

Last

year

net income

charges

the road reported a
equal, after taxes and

preferred

and

dividend

requirements, to $4.78 a common
share, as compared with $5.52 a
share for

common

Last year the

of 70 cents

the

1956

year.

road paid dividends
share quarterly, or a

total of $2.80 for the full year.

believed

this

that

will

rate

It
be

maintained, unless there is a fur¬
ther
serious
decline
in
general

pared with $23,683,906 in the like business activity.
month last year. This was a com¬

paratively minor decline,

pared

with

com¬

carriers.

most

Net

income for the month declined to

only $2,874,426
$2,963,716

compared with

year

earlier.

Randell V.-P. of
Mutual

Management ;

Mutual Management Company,
permitted—and there would services that will eliminate oper¬ understood that there were no un¬
hope, these go competitive pricing and the ating deficits for specific trains. usual adjustments accounting-wise of 120 Wall Street, New York,
to
account
for
the
January report. sponsor of Mutual Investment
three over-all efficiency that competition brings.
Since most of the trouble here is
While
February earnings un¬ Fund, Inc., announces the appoint¬
points very There would be deficits that would with State Public Service Com¬
doubtedly will be down from last ment of Don¬
clear:
make the Post Office deficits look
missions, which
are
subject to
(1) The pres- small in comparison—and you as local pressures, authority in these year because of weather condi¬ ald H. Randell
ent railroad taxpayers would make them up. matters should be turned over to tions, as previously pointed out, it to
the
office

il^

whole made,

not be

•

James

Symes

•

is not just a temporary
symptom
of
the recession the
general economy is in. It is, in¬
stead, a deep-seated and danger¬
emergency

illness which has been brought

ous

crisis

recession
off

strain of the

by the

attendant

its

and

fall-

mistake about it-

transportation
would have to be taken over.
1
mention
that
as
a
businessman

American—but

and not just as an

imagine my feeling about

you can

both scores.

slump did not of itself create the
present railroad emergency. But

(3) Our third major point was
that it was up to
Congress to
correct the situation—and to that

end

rail

traffic.

short, the

dangerous situation that has been

presented some 19 definite
proposals. Some were simple and

waiting

easy

pull

may

ever

trigger

the

since the end of the

'war to explode.
You see of

to start by
You know

why

need

well

I do that the

is going to end and the
is going to move forward
again: the only question is When?
But for the railroads the outcome
clusive.

be that simple and con¬
Our loadings will come

up—and

Heaven

welcome

that.

get

out

-won't

understand—repeal of the

per cent tax on freight, for ex¬
ample. Others were complex and

making that fact clear. required
as

recession

will not

course

economy

allow

the

attitude

ment

services.

will

just

passenger

sick-bed:

mention

to you as shippers.
One is for a change

will

the

of explanation and

how

You

rail

passenger

about

know

our

service
deficits—and
drain off money that

they

should be going to

betterments in

Commission

the

re¬

run

Government should reimburse
lor the money

thus lost.

Metropolitan rail commuter
lose
many
millions of movement of coal. Most of the
dollars a year.
Users object to soft coal handled has been steam
paying fares sufficient to cover coal for the operating utility com¬
(4)

the

cost of providing the service,

millions

added

with—will

grow

dollars

untouched.

law to

perform

substantial por¬

of these services at a deficit

Congress meanwhile per¬

tion

that

—the effect of which on the Penn¬

to you and to the rest of the econ¬

sylvania Railroad alone last year

Unless

ceives

to let

omy

owes

permit its utilities in the district served have
registered expanding earnings in
case, communities that insist on the past several years. Many new
the service should support it by generating plants have been con¬
direct subsidy or some equivalent. structed to meet the growing de¬

discontinuance.

When that is the

(5) The 10 per

bent Federal tax

passenger travel
moved.
Like the 3
on

connection

made, I
hope, another thing cleaiv That
is that the
will

ending of the recession

return

not

limited financial strength
before.
other
been

this

As in the

postwar

through,

recessions

will

had

of the two

we've

come

outbf

far weaker than when

one

in.

went

case

the

even

for this

Three

are

obvious

reasons

assets sold off to raise

cash, interruption to debt reduc¬
tion, and a backlog of deferred
maintenance and equipment pur¬
chases to take

care

of.

This

loss not only subsidizes the
public need for certain passenger
service, but also results from in¬
adequate payments by the Federal
Government
for handling
mail,
from being forced to run trains
which the public has deserted, and
from the express services which
we run in competition with United
States Parcel
Post.
Helping to

deficit

swell

the

taxes

levied

and
tax-exempt

stations-

ger

while

•similar-nature
To sum up the first point, we
tried to make clear to the Senators

that

present emergency is not
aspect of the recession that
will disappear when the recession

just
is

our

over.

but

We will be

over our

cold,

will still have anemia.

(2) The second major point we
to make clear is something

tried
you

know as

well

do—how

Government transport policies,

treating railroads differently from
any
any

other form

transport or
other public utility or general
of

business—keep the industry weak
financially and in growth.
Be¬
know as much
about that as we do, I won't recause, as I say, you

our

the

effective passenger transportation
to the public at the least cost.
Almost

every

alteration

im¬

we
desire to make
along these lines is either post¬
poned or ultimately denied as a
result of local pressures.
While

provement

this way we are treated as an
old-fashioned monopoly, Govern¬
ment policy has failed to recog-

the

Tran«5oor,,a,-''»n

Senate

Committee

Florida, Chairman.

time, the large
service railroads are
tightly bound
in a
regulatory
strait-jacket. We are not given the
right to adjust our fares and serv¬
ices so as to provide the most

lantic

Shippers Advisory Board.

furnished

same

and Forefan

States

are

rights-of-way,
facilities of a

passenger

1 Surface
a

state and

airline and bus competitors.

talk by Mr. Symes before the
Traffic Club of Philadelphia and the At¬
*From

heavy

the

are

many

local governments on our passen¬

Ruhr-——
on

Interstate

Commerce, Senator Smathers,
'

mand of the service area.

should be re¬

While

the

growth in population
of the States in the South
registered the same rate

of Vice-Presi¬

dent.

Randell

Mr.

formerly

was

associated

with the

In¬

vestment

De¬

partment

United

the

States Trust

Company
New
an

York, as

Oil Special¬
Donald H. Randell

with

and

ist,

Invest¬

the

Department of the Home
where his responsi¬

ment

Insurance Co.,

bility was the company's invest¬
ments in oil, natural gas and min¬

ing. In 1954 Mr. Randell took over
management of two mutual
ure,
unjustified
in
peace,
and of growth as some other sections funds, the Natural Resources Fund
today
a
prime
discourager of of the country, still the district and the Natural Resources Fund
needed passenger revenue.
has increased greatly in the past of Canada. Since then he has been
associated with Kerr & Co., Reyn¬
(6) In
order to help
correct few years
in
industrialization
olds & Co., and Walston Co., in
many of these problems, and to which has increased the demand
freight, this was

provide
should

per
a

cent

tax

war meas¬

the basis for a solution
important areas, Congress
specifically prescribe the

of many

has

not

for additional electrical power

and

addition

most

this,

reasonable return on its invest¬

tively

for
use
of facilities
provides; and (b) where
a customer, Government

older

and

newer

shall

pay

costs

cover

rate sufficient to
a
reasonable

plus

higher rate than the
Railway

•

continues in

strong financial position." At the

end of last year,

vestments

cash amounted to

temporary

$24,279,420;

were

profit.

cash

$22,184,736

in¬
and

special deposits were $3,308,654.
with us on such This compared with cash of $23,proposals. I don't see how else
222,684; temporary cash invest¬
we
can
correct a situation that ment of
$31,114,595; and special
I trust you are

drains off millions of dollars that
should be going

to improving our
fixed plant and freight equipment
for your service.

deposits of $3,625,876
of

1956.

rent

assets

.—at the

less

Salvation Army
Two

field

current liabilities

end of 1957 amounted to

Another

serving

are

Drive

investment

the

men

chairmen of

committees in the Commerce and

Division of The
1.958 Appeal.

Industry

Salva¬

tion Army

Homer

O'Connell

of Homer

O'Connell & Co., Inc., 120 Broad¬

is Chairman of the Commod¬
Exchange
and
Over - the Securities Dealers Com¬

way,

ity

Counter

mittee.
W.

at the end Stokes,

current assets—cur¬

Net

On Committees for

modern

ones.

Southern

which it

it is itself

New York.

the

plants in the South are compara¬

adequate user charges, including plants
a

the

the need for more steam soft coal.

ing with different forms of trans¬ than in the so-called industrial
port.
Included should be laws East and it has been found more
that (a) Government shall collect economical'
to->*operating- these

loss of about $57,000,000. ment,

wqs^a

us grow.

that

Government

panies in the territory served. The

and regulation will not

policy which the Federal Govern¬
ment will follow in its direct deal¬

buses,

"One factor which has tended to

services

business with the airlines,
and the private auto¬
mobile. We alone are required by

senger

that

up
the road's traffic on a
comparative basis has been the

the

getting

carsome

hold

problem—the

recently

in other

problem

that

understood

money-losing pick

equipment and service.
The railroads compete for pas¬

loadings have begun to show

March earnings
trains
as
a
public service—and might not be as badly depressed
as had been anticipated.
will not permit us to raise rates—

in Govern¬

When

quires

pro¬

posals in three areas that I should
think would be of special benefit

knows

But that

reams

documentation..
I would like

the Interstate Commerce Commis¬
sion.

strength to
develop and grow with the grow¬
ing economy and its increasing
transport
needs.
For
our
real
the

make

And

all common carrier

Stock

Stokes,

Hoyt

Partner in
Company,
15

Jr.,

Street, is Chairman of the

Broad

Exchange Committee.

Eugene W. Mortlock, President

proposal I hope you are $20,198,985,
as
compared with of First Federal Savings and Loan
is the creation of a $15,002,296 at the end of the pre¬
Association
of New York,
1274
agency to acquire a ceding year.
Sixth Avenue, is Chairman of the
limited amount of railroad loco¬
As
an
indication of Southern Savings
and
Loan
Associations
motives and cars, and lease them,
Railway's credit, on Jan. 6, a sub¬ Committee in the Commerce and
on a full-pay-back basis, to rail¬
sidiary company, Virginia & Industry Division of The Salva¬
roads that need them to do a full
Southwestern Railway Co., sold at tion Army 1958 Appeal in New
job for their customers. This is
competitive
bidding $5,000,000 York City.
not subsidy—since it will not cost
general mortgage bonds, guaran¬
The Appeal, which has a goal
the Government a dime.
And it
teed by Southern Railway, at a of
$1,275,000, is seeking support
does not open the door to Govern¬
cost
of 4.33%
to
the company. for the 60 institutions and serv¬
ment ownership of railroads—it
Even with lower interest rates in ices
operated by The Salvation
helps keep the door closed—which
I assure you we are every bit as railroads
into fewer number of Army in Greater New York.
interested
in as you
are.
And systems should be encouraged and
please don't forget we will be pay¬ expedited. This would not require
Now Dual Planning
ing for the locomotives and cars new
legislation,
but
increased
for your use—not for decorative
railroad initiative
and Commis¬
FREEPORT, N. Y.—The firm
with

Government

purposes.

The

last

proposal I shall men¬
tion is also. I think, to your ad¬
vantage. When it is shown to be
in
the public
interest—that is,
in your interest—consolidations of

sion

approval should be urged.
duplication and over¬

name

Wasteful

has

lapping of facilities and services
would thus be eliminated, to the
benefit both of the customers and

Highway.

of the

industry.

Mark

Weisel

Company

been

changed to Dual Plan¬
ning Corporation, and offices will
be

located

The firm

West
was

Sunrise

formerly

North Bellmore.

Number 5724

Volume 137

The Commercial and Financial Chronicle

...

(1165)

from

8400,000 to $450,000 by the

sale

stock

new

CONSOLIDATIONS

NEW

Bankers

and

OFFICERS, ETC.

REVISED

8 at

the

ville

record

National

111.,

stock

Bank, Naperville,
increased from $50,000

was

pointed to the advisory committee
of

the

branch
45th

Madison

Street

announced

Manhattan, it

was

Champion,

President.
h-

The

Wren

Assistant

tit

Permission

the

:i:

has

Conn.,

McDermott

joined Manu¬
facturers Trust Company in 1940.

Mr. McDermott is
assigned to the branch loan con¬
trol
department located
at the
bank's new head office, 44 Wall

branch

Canaan

and

New

York,

head

has

office

its

moved

Wall

William

corner

just

Street—

The

Street.

Mr.

New

tional

Wilton.

This

Greensburg, Pa., with Mellon

and

Bank

has

boards

will

approved

April,

announcement

Com¬

by the

of both

submitted

shareholders
to

Trust

and

been

of directors

banks

according
March

fer

Frank

convenient, effective and

faster service to all groups of cus¬
tomers.
tit

...

tit

Denton, Vice-Chairman

Mellon

posal,
New York, has elected Herbert M.:
Kelton

its

Center

Rockefeller

Office Advisory Board, it was an¬
on March 7 by Harold H.

Barclay

the

pro¬

Westmoreland

shareholders will receive
two

bank's

Bank

Si:

Leo
and

Fisher,

Vice

;

Bank

Crane

"The

First

Rock wood",

its

title

and Trust

Bauk

Tennessee
"First

one-hundredths

one

and

Mr.

Bank

effective March 1.

Stockholders
of
Citizens
and
Southern National Bank,
Atlanta,

was

later.

title, he will act

new

officer.

Hunter

three

had

years

before coming to CrockerAnglo in September, 1949. Origi¬
nally an investment analyst, Mr.

the

Hunter

Lees-

its

com¬

$150,000
Feb.
27,

si:

National

They

his

Sansome
E.

the

office,
Jr., and

Crane

banking

and

perience

Mont¬

had

eight
years'
credit analyst ex¬

New

York

prior

Sansome

1954.

Street

Early

the

fall

following

assistant cashier in

and

years,

entered

new

the

business

department.

Under

title, he will be

loan

officer.
Mr.

Taylor joined the Bank at
beginning of 1930.
Serving
the 1 Montgomery Street office,

Street

Hunter,

Taylor

the

Schneider

Two

dent

by
Bank, it

James

are

named

development

President Paul

Edwarcl

was

transferred

department, where he

later he was
promoted to Assistant Vice- Presi¬

Francisco

San

credit

1952.

later

was

the

year,

became

keeper in
bank's

assistant

head

book¬

1942, then entered the

real

estate

was

named

estate

department. A

appraiser in

1948, he

Assistant

Cashier

five years later and was promoted
to

joining the credit department at

:£:

his

loan

Mr.

Street office.

gomery

changed

National

under

outstanding—
value $10).

tit

Robert

Earle

Company of Rockwood"'
si:

par

:£:

and

the

and

National

Hoover.

Louis, Mo.
:'s

from

announced by

has
been
Director of the Bank of

Bank

increased

Crocker-Anglo
was

Schneider

Mr.

assistant Vice President

months

Subsequently,
performed loaning duties and,

Four Vice Presidents have been

elected

stock

effective

President

the

tit

new

capital" stock

appointed

National

$300,000

Bloomfield, .Missouri,
St.

sale

30,000 shares,

si:

Director

department,
five

provide
increase

to $36,443,000.

Florida

(number

First

career

City

the

mon

into

merged

banking

his

banking expeiience in New York

Citizens

joined First Na¬
Assistant Vice-President
December 30, 1955, when the

Schneider's

named

will

was

until

capital funds

burg,

and

Schenk

Bank

new

one

that

increase will raise the bank's total

tit

terms

tit

Chemical Corn Exchange Bank,,

United

Bank.

the

Under

March

Company in 1925.

their

by John Barclay, Jr., President of
Barclay-Westmoreland Trust and

has

for

National Bank in St. Louis.

proposal to merge the Bar¬
clay-Westmoreland
Trust
Com¬
pany,

began his banking

with

United

been
completely
modernized and redesigned to of¬
building

Schenk

Trust

three

14 offices.

Mr.
career

National

Company,

one

Directors

funds

open

two

will give the Bank

pany,

Trust

Manufacturers

offices,

present,

Street.

obtained

been

Bank and Trust
Fairfield
County,

Stamford,

actions

in the

man.

National

new

Board

two

share the

basis

latest

duties

1956, he

position
promotion.

Mr.

held.

ten

the

began with Crocker-Anglo in 1950.
Assigned originally to the credit

$2,500,000
capital and surplus
$1,000,000 for the Citizens and
Southern Holding Company. The

Vice President of First National
in St. Louis at a
meeting of

4, according to an announcement
by William A. McDonnell, Chair¬

the

each

Assistant Vice President

held

and

Assistant

assumed

and

loan officer.

named

and

Bank

the

Sec¬

Chairman of

the Old Colony Trust Co., Boston,

Company

member

April 8 will receive the
dividend and the right to

The

elected

was

the trust investment committee of

Horace C. Flanigan,
the Board.

elected

was

stock
for

t\t

Richard W. Schenk

and

retary
of
Manufacturers
Trust
Company, X. Y. is announced by

Mr.

!?.

Mass.

President

appointment of Edward C.

McDermott

Paul

Vice

par

$50).
tit

and

Avenue

by George

value

shares,

3,000

—

Bank's

Manhattan

Chase

outstanding

$150,000 effective March 1;
(number of shares outstanding—
3,000 shares, par value $50).

promoted

was

Cashier

purchase at $30

L. William Moore has been ap¬

be asked to vote April
special meeting in Savannah
a
proposed sale of $3,000,000
new
stock
and
a
5% stock

Upon approval, stockholders of

com¬

caiptal stock of The Naper-

mon

CAPITALIZATIONS

will

dividend.

stock dividend,

sj:

BRANCHES

Ga.,

Feb.

24, (number of shares outslanding
—18,000 shares, par value $25).

News About Banks
NEW

effective

Assistant

1955.

Taylor
as

Vice

Under

will

real

his

President

new

title,

continue to

Mr,

function

estate loan officer.

Mellon Bank stock for each share
of

Barclay-Westmoreland.

nounced

Helm, Chaivman.
Mr.

Kelton

Director

arid

Vice-President-Finance of United

States Rubber Company. He is a
of the American Insti¬

Subject to the approval of the

FOR HARD TO FIND

shareholders of both banks and by
the banking authorities, the two
offices

Barclay-Westmoreland

SUBSCRIBE TO OUR MONTHLY

Trust will open on

April 14 as the
Barclay offices of Mellon Bank.
tute of Certified Public Account¬
Upon completion of the merger,
ants and the Controllers Institute.:
the following appointments would
member

BANK & QUOTATION

be made: John

Irving

Company,

Trust
the

announces

D.' Wilson

ward

Vice-President

from

Y„

of Ed¬

promotion

Assistant

Vice-President.

Since joining the

Irving staff in
1953, after more than 20 years ex¬
perience in mortgage financing,
Mr. Wilson has been
the

bank's

Mortgage

Division.

Estate

Henceforth

Donald

Mr.

Wilson will be associated with the-

tion

Whitney

Senior
to

Bank

Kelsey

Vice-President, assigned

commercial

the

formerly

was

division.

the

officer

Guaranty Trust Company of N. Y.
'

■

■ :

Carl

Huebner,
associated
with the Metropolitan Life Insur¬
Company,

ance
a

has

Bank,

lr.,

Willard

Neil

Callanan,

Trust's

board

Company,

1929 and became

By the
common

was

Vice-

1944.

tit

tional

Commercial

Trust Company
increased

and

Bank

of Albany, N. Y.,
from

$5,269,500

outstanding—737,730

•

BOSTON STOCK

•

DETROIT STOCK

The

Rutland

Bank.

Rutland,

its

Trust

present

•

MIDWEST STOCK
NEW YORK

•

BANKS AND TRUST COMPANIES-

with

George

the

000

National

increased

its

$250,000

stock

the

County

Chester, Pa.,

was

EQUIPMENT TRUSTS

the sale of

new

stock.

Ef¬

fective Feb. 26, (number of shares
■

•

PITTSBURGH STOCK

STOCK

EXCHANGE-STOCKS

EXCHANGE

FOREIGN

when it
Westmoreland

•
•

INSURANCE

•

INVESTING COMPANIES SECURITIES

name

BANK

BONDS

PUBLIC

UTILITY

BONDS

•

PUBLIC

UTILITY

STOCKS

•

RAILROAD BONDS

•

RAILROAD STOCKS

•

REAL ESTATE

BONOS

INDUSTRIAL BONDS

•

REAL ESTATE

STOCKS

INDUSTRIAL AND MISCELLANEOUS STOCKS

•

UNITED

•

UNITED

STOCKS

STATES

GOVERNMENT

SECURITIES

Penn

STATES TERRITORIAL

BONOS

OTHER

STATISTICAL

INFORMATION

Pa.,

died March

stock, the
stock
of
The
National Bank,
new

•

CALL

LOAN

RATES

•

DOW, JONES STOCK AVERAGES

•

SECURITIES CALLED FOR

•

FOREIGN

•

TIME LOAN

•

MONEY

•

VOLUME

EXCHANGE

MARKET

PRIME

BANKERS' ACCEPTANCES
REDEMPTION

RATES

OF TRADING

increased from

Clifford

•

CANADIAN

GOVERNMENT BONDS

$1,210,000, effective
Feb. 24, (number of shares out¬
standing — 121,000
shares, par
value $10).
$1,100,000

MUNICIPAL BONDS-

Vice-

Central

•

(RR.)

FEDERAL LAND

common

•

of 54.

Delaware

•

years,

sale of
capital

•

WILLIAM B.

NEW

Yerkes,

founder

former Vice-President of the

old Southampton State Bank, Phil¬
adelphia, Pa., died March 5 at the

TODAY

DANA

CO.

PARK PLACE

YORK

wish

for one.year

7, N. Y.
subscribe

for the

Name

sum

the

Bank

Quotation

of $40.

—

of 68.
f.-

tit

Address

divi¬

$250,000 to $300,-

PHILADELPHIA-BALTIMORE STOCK

CANADIAN

Bar¬

The

Bank, Philadelphia,

the last

age

PACIFIC COAST STOCK EXCHANGE

•

DOMESTIC
<

bank

the

Schultz,

tit

and from

000 by

County
Vt.,

NEW YORK

•

EXCHANGE

EXCHANGE-BONDS

EXCHANGE SEATS

tit

President
National

and

QUOTATIONS

•

EXCHANGE

STOCK

DOMESTIC

Company in 1903.
tit

ti'i

capital stock from $200,-

common

dend

tit

EXCHANGE

•

shares, par value $7.50).
V

EXCHANGE

•

Company.

Trust

EXCHANGE

•

incorporated

was

clay

for

AMERICAN STOCK

GENERAL QUOTATIONS

Barclay Bank until 1903 when

$5,532,975, effective Feb. 21, (num¬
ber of shares

The

tit

sale of new stock, the
capital stock of The Na¬

will

•

4 at the age

tit

directors

sylvania, has served the Greens¬
area. Tor over 104 years.
It
was
founded in 1854 by Thomas
J.
Barclay,
grandfather of the
present President John Barclay,
Jr., and Vice-President, Joseph
Barclay Fogg.
It was known as

and

Buffalo,

advisory committee.

burg

merged

Vice-Presi¬

Mr. Callanan joined the

old.

President in

was

Barclay-Westmoreland

Barclay - Westmoreland
Trust
Company, one of the oldest bank¬
ing institutions in western Penn¬

took

Manufacturers

Trust

bank in

died March 6.

Y.,

years

announced

the

Traders

Savings

Place, President.
*

dent

elected

been

trustee of the Excelsior

STOCK

assisted

by Edward C. Brinker and Willard

Com¬

N. Y., announced the elec¬

WE GIVE

will head the in¬

stallment loan department

form the

Industrial

The
merce,

Dean

J. Martin.

sion.
£

Evans
and
Joseph H.
Assistant * Managers
and
E.
Gleeson, Trust Officer.

John

bank's Loan Administration Divi¬

RECORD

Beile,

Real

and

Barclay, Jr., Chair¬
Advisory
Committee; Jo¬
seph B. Fogg, V.-P. and Man¬
ager;
Oliver
S.
Collins,
VicePresident; W. W. Lapham, VicePresident;
Clarence
R.
Drylie,
man,

John

member of

QUOTATIONS

stock

dividend The

increased its
from

common

$200,000

—.

—

Cen¬

tral Naional Bank of Sterling, 111.,

City

capital stock
and

$400,000

tfr

«»

1—1.

Zone

State—

The Commercial and Financial Chronicle

(1163)

country.

Electronics in Ten Years Will

from

increasing

Replace the Auto Industry
Corporation
California

of the economy, opines

West Coast electronics head in

The electronics

glorious

even

rendered
in

outstanding

It has

just
In

ten

peace.

the

past

years

Industry
temporary plateau from

the

acteristic of

this

H. Leslie Hoffman

has

year.

Home Amusement

Our

seen:

Industry

grow

from $1.3 million to $2.5 million;
Our Repairs and Services from
and

Commercial

from

$432 million to $1.9 billion; Our
Defense

from

low

1948

$145 million to $3 billion in 1956;
and
our
Broadcasting Industry
from $500 million to $1.8 billion.
You will note that the most

become

the

parts

and

the

repair and servicing of our equip¬
ment, industrial and commercial,
and the defense establishment.

serve

have
that

now

properly the

many

members, and

the

individual

use

the

recognizing

Manufacturers
Electronics
to

divi¬

activities

and that we use
simple yardsticks of
contribute

not

our

the

di¬

associa¬

Television

Association,

only its current
in
addition,
its

but,

industry

significantly to

has

security

high standard

our

our
our

its

and

eyes

sometimes

his

ears

taste

and

sometimes his muscle, and

functioning

These
all

increasing

fields

and

industry.

the

new

tools,

and

new

services

new

highly

touch,
now

brain.

functions

significance
The

challenge ahead is for our
try to find the markets to

and

man,

man's

applications

have

much
community,
stockholders

our

how

much

knock

competition.,
is an
industry that for
has given the greatest
dollar
bargain in services and
products of any industry in the

Continued

from

to
real

indus¬
utilize

techniques,
ingenuity

that

competitive

and

free-enterprise industry have de¬
veloped.

England

$20 billion industry—this

growth to be

across

some

the

sive

quired

being released by fission.

But

even

this

progress the
uranium fuel

the

large sized

the order of

actual

cost

burned

plant

power

one

state of

present

and greater contribution
this advance of the art. How¬

most

conventional fuels.

The

nuclear plants up to the
present time have not been com¬

reason

petitive with conventional

power

plants is not the cost of the burnof nuclear fuel,

It is because

nuclear plants have a higher
phys¬
ical
plant
cost
and
therefore

higher investment and deprecia¬
tion
charges.
Also the nuclear
fueled plant must have a large
stock
at

uranium

the

start.

enough
from

uranium

time

burnup.
nuclear

the

After

reactor

that,

fuel

time

only
added

offset

the

This initial inventory of
fuel

adds

and

of
to

course

the

expen¬

investment

address

the Electr

Los

Angeles,

-*-s

have

I feel that at the same time
are doing
this we should be

directing

sketchy

method of

touched
way

the

getting heat from ura¬
the
relationship be¬
large quantity of ore

nium

and

tween

the

that must be mined to get a small

our

per¬

indus¬

by Mr. Hoffman be¬

Industry Association,

Calif.

will

quantity

order

things I

For the

fissionable
give

for

about to say.

past year

tors have been in

so,

state of doubt

tors

Replace
The

Industry

Auto

will

reac¬

are

the
.

and

research
in

the

operation

test

United

re¬

States

plans have

and

been announced for the construc¬
tion

types.
now

reactors

all

The civilian power reactors
in operation have a total

capacity of about 85,000
The reactors

now

under

construction will bring the capac¬

with

inferI'ere

construction

built

re¬

military

total of 45 power

under

actors

thermonuclear

not

three

power

under

are

Also,

re¬

years

controlled

addition,

United States.

laboratory

construe*;

con- ; ity
to more than' 650,000 kilo-"
produce ' watts by 1960. It becomes increas^;
ingly clear that we are going tci
electricity from nuclear fission."

attention

development and

struction

have

reactors

the

authority

have

completely atomic powered

Navy, representing in the aggre¬
not < merely" gate a great deal of power and

leading scientists in the: field;:that
these statements
the

were

of ' scientific'-

expression

therefore

cau¬

much

uranium./ Three

atomic submarines. are in opera*
conservatism,* but' that*
they reflect the true status of -this ' tion, 16 are under •Construction;
or v on 4 order - and
Congress has
development. £
appropriated funds for three morei"
As everyone in the
power busi¬
tion

automobile

and

industry
has
which we
measured our economy.
It is my
An atomic aircraft carrier and a
opinion that the electronics in¬ ness
knows,"' oftentimes
capital
guided-missile cruiser'* are also
dustry in the next 10 years will
cost, even more than fuel' cost,
under construction.
* /. ?,
replace the automobile industry determines the cost of power: J
Let me enumerate some of the
as the economic pulse of our na¬
7:i Even if it is 'possibleto,.extract; atomic plants which are now de¬
tion inasmuch as electronics will
deuterium from sea water'., at 4 a
livering electricity. There is the
be functioning in all branches of
reasonable cost, nobody has: shown *
big Shippingport plant in Penn¬
industry as well as in entertain¬ that it will be cheap to get fusion
sylvania;, the Pacific/Gas & Elec¬
ment, communications, medicine, from deuterium and nobody - has
tric .plant just . outside ~of
San
and other social services. Ours is shown that it will be
cheap to get' Francisco; the Atomics -.Interna**
a great destiny and a great chal¬
power; from fusion/A fish -in;the ' tioiTal v Plant 5: at % Santa Susanna
lenge. The example we have in ocean 1 costs! very Ilittle—about as near Los
Angeles;/ the Argonne
much as the ocean water /itself.V
Los Angeles of close coordination
Laboratory Reactor;: and;the Army
It is quite another matter when
Package/Power Reactor at Fort
between community, the academic
that, fish is caught, transported,
Bel voir, Virginia./::;; ;;'
:C: ; > >
life, the city and industry is a cleaned, cooked and served to you
The four large-scale plants be¬
" *"
'
good pattern to keep in mind in in a hotel. ;
>:
ing ; built by industry are: The
the

been

criterion

•

„

♦

•

all

activities.

future

our

Research in controlled fusion is

continue

will

which

spring

from

three

fear

that

become

not

fear of

control of

before

started,
will

the

atomic

fears:

But

industries

power

and

.'V

sume

Sees Fusion Long Way Off

First,

aware

neutrons

to fusion.

the

have come from the fusion of
hydrogen atoms. Whether or not
from true fusion, the work—
particularly the containment of
such incredibly high temperature
—represents an important scien¬

tific achievement in Great Britain
and this country, and one of which
the
Free
World vmay
well be

there
is
no
basis,'
or
otherwise, for the
impression that power
from fusion for industrial appli¬
will

achieved

the

foreseeable future, if ever, or that
abundance of

(heavy

hydrogen)

water that fusion power, if it

will

cheap,
nomical and competitive.
comes,

The

the

they, with

years,

eco¬

announcements : issued

Atomic

the United

Energy
States

and

agencies

Great Bri¬

134,000 kw/•

disturbed

Utilities Are

problems r of

succeed?

the

•<

first

plant goes

fusion

these

were

The

quite careful and

both of these points.

British

Authority

ex¬

built
r

Atomic

"Many

Energy
major

atomic

reactors to be

power

costs

ment

have

some

cost, of

and develop¬
first

these
cases

plants

doubled

the

the output., Also the

pioneer : plants had to be overdesigned and over-built to insure
safety and success of operation.>
•

The

learning

curve

reactoi?

design and construction will bring
down

power

costs rapidlv. Only recently

Admiral Strauss disclosed that, the

the drawing -boards.

Boiling

Water

Reactor*

Power V. which is a full-scale experimental
*u'\CcJ7: power ', reactor,;5 had" been, com*

Competitive .Uranium

v>;,Prospects

•

to power from* uranium

plcted in half the estimated time,
competitive;;/,First off,> at half the budgeted cost and was
let's state what the competition capable of producing 2Vz times its
is. In the United States as a whole designed heat output. He indicated!
that a comparable increase in heat
the average cost of generating 1
kilowatt hour is about 7}? mills. output is expected at the Pacific
But when one departs from coun-/ Gas &
Electric plant and that the
try-wide averages and goes to Shippingport plant may follow the
sections, the range,of, such cost same pattern. This, of course, will
is from 4 mills low to 12, mills mean
significant
reduction-; in,
high. In most of the. other coun¬ kilowatt hour costs. '
tries on earth the cost is substan¬
Despite all of this progress in
tially higher. I know places where the reactor field, "members of the
the fuel cost alone is in excess of Joint, Congressional Committee on
20 mills per kilowatt hour."
atomic energy have been pressing
hard
for
even
How are we progressing Toward
greater govern-

/- Now

necessarily of high cost.

experimental

High

unit

first

were

Argonne

becoming

•

said,

future

plants./-; /'

The

tain

the

to commit several hundred
million dollars to the building of

/•••'//7;

sizable
on

dence

fusion will

,/y

power

head start

the'-infinitely

Confident

realistic manage¬
ments of our large public utility
companies
have- enough
confi¬

immediate field while those
on

Massachusetts with

/y.,>>4-

Clearly ythe

will fail in their

But

cations

ever

become

Edison's

Plant at Rowe,

difficult

scientific

sea

economic appli¬

is that
atomic powered electric generating
stations
will
be .in -operation
throughout the United States, and
will be producing a very substan¬
tial portion>of our total electric
power
requirements long before

produced did in fact

popular

180,000 kw;; Consoli¬
plant at Indian*
point. New York with 163,000 kw;
and the Yankee Atomic Electric
with

cago
dated

will

My view of the future

come

proud.

that

working

reports that
in a test tube

may

the neutrons

time

many

We are all

recent

produced

seee

been dis¬

century

technicians are also working on
making fission more effective and
economical. .Why should one as¬

of these fears.

this

fusion laboratory has
a new scientific advance to report:
Scientists,
engineers- and
other
every

oversupply of uranium.
should like to examine each

scientific

announcements

in the uranium and atomic energy'

gotten

competitive

and

Development Com¬

plant near Monroe, Michiwhich will have a capacity
of
100,000
kw;[ Commonwealth
Edison's plant, southeast of Chi¬
pany

; gan,

cations of fusion for power and it
is somewhat absurd for investors

hydrogen

has

further

Power Reactor

in/this

both

in the past have

quieting.

to the future of uranium. Their

plicit
inves¬

making

kilowatts.

the current

on how to
techniques,
and products in the better proc¬
essing of industrial and commer-cial
products and
services < and
finding a market for them/
our

material

background

reactors

probably

develop

actors...

dduterium of the
said, "Years of inten¬

program

utilize these many new

deuterium

merely
layman's

matter; of years
be able* to build

commercial

begun

ship "Savannah" and
experimental civilian

he stated

even

has

AEC

electrical

ever,

because there is

whole.

greatest

trial and commercial devices and

fore

The

tion of the reactor for the nuclear

the

been

reactors financed
entirely by indus-*
power reactor for

"the

greater

mill per kilowatt

hour of electric energy produced.
This is less than the burnup cost
of

to develop a
full scale power producer.- There¬
fore," Admiral Strauss concluded,

;

the

work

require

making

uranium power

the board but

centages of growth in

♦From

will

obsolete

ura¬

full-scale power

in¬ thermonuclear
d e v i c'e
which
in size, go
:
would yield more energy than it
higher
into
the
stratospheres- consumes. And after
that, it will
deeper and farther in the ocean,
electronics

into

principally

weapons

fusion may make

nium

in speed, reduce

available in

unit of natural

States, seven
of which
operation during 1957.
Construction is in progress on four

will

operate

oceans."

fear that

has

fusion, yet

utilizing

our

military

our

doubts

•

;

charge of the plant

Statistically our industry is des¬
tined to practically double its size
in the next ten years and to be¬

with

and

By progress in science and tech¬
nology more and more of the heat

sive

Will "Double Its Size"

before

development.
Cer¬
should give considera¬

there

natural

use

United

went

country and in Great Britain and

come

work in

that: "It will be

probably not
in

;

timef

high-temperature power
are
operating
in
the

reactors

driving force behind the scientific

The Future of Uranium
uranium.

•

Strauss

achievements

reactors

fourteen

2, 1.942,; when the try, and
self-sustaining fission reactor- Belgium.

Admiral
-

page

construction.

point comparable

obtained."

was

going

the

accomplishments
in
industry, education, medicine,
the military,
communications and
transportation. It has functioned

and

than

how

Ours

living and has affected
social and political lives and

the

nation,

of the

some

our

contributed

from

name

probable activities of the future.
Our

the

are

Association

Industry

describe

further

Electronics

suggest,

way

operation

businesses.

own

versified interests of
tion by changing its
Radio

type of autonomy
management
dictates

should
our

yet at

program of reactor
At the present

sizable

very

the

Energy Commission
sponsored or stimulated a

December

first

same

good

asso¬

our

given

sions the

trade

our

ahead

race

many years

Some five years ago we started

realignment of

the

increasingly important
segment of the overall national
economy,
that we assume these
responsibilities in a more mature

rather

would

apply to individual companies.

have

interests of

practically all of the

fittest

the

ciation to

and

that this healthy survival

appear

will

sig¬
nificant increases percentage-wise
been

dramatic

of our art, forces many
to leave if they lack the
proper balance between manage¬
ment, technical development, and
marketing capabilities. It would

$0.5 million to $2.3 million; Our
Industrial

and

years

lor the production
In the field of fusion,

not

are

billing dollar for
this research and development.
•

people

forecasted $12
biilion indus¬

try

phases

billion
to

that

intense

that

grown from

industry

up¬

However, history indicates
competition, char¬

years.

our

tainly

crease

move

equipment

obsolete

industry has
$2^2

industry to enter, which is well
represented by the number of
firms that have come into being
in this area during the past five

and

economy

significant

improved techniques and services.
Our industry is a fairly easy

sound

research

Lewis

The Atomic
has

••

fusion

power.

pendent on improving and ex¬
panding' the services rendered to.
the customers through technical

Our Home Amusement
a

but

well, is de¬

centage of

made

maintenance

devices

amusement

many

economic power from

the fission of uranium?

Strauss,
A.E.C.,; within
the last month stated that, "We
should not expect early harnessing

other services

our

sold in the past 10 years has been

and

ment

home

battle for superior weapons.

our

ward

ntributed

for

Admiral

Research

for

stage

Chairman

which it is destined

the develop-

tion to setting aside a higher per¬

has hit

and has,

materially

increasingly

the
in

contribution to defense electronics

service

and

war

peace
c o

past

brilliant future.

with

market

healthy one.
We
must recognize, however, that our
forward progress, not only in our

industry has had
and it holds an

yet." ;

every

customer

tically

of passing on the
savings of our manufacturing in¬
genuity and; efficiencies to the

doubling of the industry's size to $20 billion
in next ten years. Mr. Hoffman, though pleased in pointing
out that the industry "has given the greatest dollar bargain
[than] any industry
suggests the time has come
to set aside a higher percentage of the billing dollar to
research and development.
prognosticating

research

Set Aside

nation's economic pulse, encompassing many more seg¬

ments

many

This practice

industry will replace the automobile industry as

Electronics

capabilities

commodity
going
price rather than down.

j" Hoffman Electronics

the

its

Thursday, March 13, 1958

the goal of

problems have still to be solved
before practical application can be
seriously considered, and the work
must be expected to remain in the

went

fold—and this in the face of prac¬

American

By II. L. HOFFMAN*

Los Angeles,

television

While

$6*00 product 10 an average
of $200, at the same time we were
a

Volume 187

Number 5724

The Commercial and Financial Chronicle

(1167)
mental

the

activity and

building

They

want

ward

assistance in

Energy

Commission,

Commission

reactors.

power

the

was

representative

tons
and

from the present horse ancl

effect that for the time being new

milling contracts would be limited

about

VTnere

Government
petus

the

which

both

It is

and

power

the

was

vestors.

note

and, as by¬
product plutonium and perhaps
certain radio isotopes as well. In
England the big Calder Hall plant
produces

not

areas

served.

now

statement

that

But

that

interesting

other

from

sources.

Free

year,

World

,40,000

tons

5,000 to 6,000
South
This

Government

Mr.

Johnson,
while
It is a fair assumption that the
speaking before the Western Min¬ Government's
requirements will
ing Conference last February 7,, not
decrease rapidly.
What then
said, among other things:—that is the outlook for
the development
the uranium industry is the bright
of
a
civilian demand for
ura¬
spot in the mining business; that*
nium?'
the
Government's
purchases A of

pluto¬

because of this pluto¬

production that the British

expect

to generate elec¬
tricity at an initial cost of 9 mills

domestic oxide which

in their nuclear power plant sys¬
tem. England expects to bring her

will

1959

and

shortly

171

million

dollar

to 322
will

were

level

million

AEC

at the

1957

further increase

electricity by nuclear fuel 1960; that it will take about 7,200,cost of electricity by; 000 tons of new findings of ore
to
replace the uranium mining
rate in 1959; that the uranium in¬
mills is substantially less than the dustry is an - expanding industry
cost
of power
today in certain with an assured price; that the
sections of the United ^States, as current problem of limited ura¬
I have just
pointed out.
It is nium-production relates only to
significant that England has gone the short-term period with further
the

conventional fuel within six years.
Even England's initial cost of 9

its

future

power

system.

C, If reactors in this country
to produce

from

expansion needed for the longer
:: term. Also he referred to the fact

were

plutonium and certain
isotopes as by-prod¬

that

electric

5,000

1970.

total

may

to 10,000
Thus we
World

Free

tons
see

that

toward consolidation is

Insurance Stocks

where

pronounced than it is in the
insurance
industry.
For
many

the insurance
supervisory
laws prohibited not only the writ¬

years

demand

where

only about 14% of the total energy

between

The

year

the
the

next 10 to 15 years may run some¬

represents

power

United

—

spite of the efforts of some shown. Life companies which for
Congressmen and
of
others
in years had been
largely somnolent,
governmental positions, the trend abrupty
became
speculative fa¬
toward mergers among all sorts of
vorites, being ranked among the
corporations continues. The move foremost
"growth"
stocks.
This
brought them
not

alone

into

popular favor
investors, but

among

other companies in the in¬

among

field

surance

whose

State

laws

was
barred to a single company have
witnessed.
Some
of these
requirement will grow
steadily until in the 1970's it will by most States. This led to the mergers (omitting obscure cases)
setting
up of groups of companies are as follows:
probably amount to between 5,000
under single management,
or, as National Life of Iowa consolidated
and 10,000 tons a year. The Eurait was
designated, fleets of writers.
tom
countries expect to require
with National Travelers at

for

the

now

industry alone

Week

that their

uranium

from

power

This

permitted mergers of fire-casualty
require from 20,000 to 30,000 tons
of uranium oxide per year. Others ing of fire lines and life coverages and life units. The result has been
have given even a higher estimate. by a single company, but also, the the biggest merger move within
The British
insurance industry that we
authorities
estimate writing of fire and casualty lines the

cost of

below

officials forecast that 10 to

years

States

dollars in

By ARTHUR B. WALLACE

during

military

nium

Bank and Insurance Stocks

production of
of oxide per

this period and longer for
and other purposes.

Africa

adds

most of which will be taken

by the

upset the uranium miners and in¬

produce power

nium.

some

This

give greater im¬
building of dual-

reactors—reactors

purpose

would

the

for

too

pressure

another

coming

quickly for¬

move

buggy stage of development.

with

who

made the statement last fall to tne

30,000 and 50,000
year. Since we

oxide per

Travelers

pany

Insurance

good

example

the

fleet

arrangement. The principal
business is life writing by Travel¬

the parent.

ers,
are

Travelers

the

Com¬

But also operated

end of 1957.

Southern Republic Life and South¬
west American Life.

Continental Fidelity Life of Dallas

merged

Indemnity Company,

with

North

American

of the radio

consumed in the United States and. tons

ucts

only building up to an
ter Oak Fire is also a component Home
Insurance
of
New
York
overall production of 40,000 tons a
of the fleet. The casualty business
purchased Peoples Life of In¬
of the fields where heat is used year, it is easy to see that unless
came into being
diana.
long after the fire
the military requirement slackens
;
:
directly in industry.
V
;
lines had been operating. It was,
Northeastern
Life
and
Mountvery materially—which seems to
Last Fall's "limitation
on
new
in a sense, an offshoot of the older
-Vernon Life
of
New
York
mills reflected in part the Gov-' me unlikely—we might not have
part of the industry, and got its
.•merged.
%
V;
ernment's emphasis on economy in enough uranium to go around.
principal growth under workmen's
the national budget.
Continental
Insurance
of
My prediction is that we will be
New
Because of
compensation laws and, of course,
i York
and
the Loyalty
budgetary limitations, the AEC pinched for uranium in the 1960's when the motor car
Group
grew in popu¬
unless we greatly expand our re¬
was finding it difficult to purchase
(Firemen's fleet) of New Jersey
lar favor. Deduct the various

generation, and if
by-products were sold at

these

power

prices in line with their value in
use,

would

be able to deliver

nuclear fueled

com¬

The use of radioactive isotopes

American
industry has been
growing rapidly. The AEC esti¬
mates

that

saved

industry about 400 million

dollars in
that

cast

use

these

isotopes

1957.

It has been fore¬

matter

few

jfears isotopes may bring savings
to industry more than equal the
cost

our

program.

entire

Atomic

Energy

Such savings cannot be

overlooked

appraising the fu¬
ture of uranium. If isotopes alone;
will bring savings to offset the>

entire

cost

difficult to

industry

the

except forward.

direction

any
.

—

Meanwhile,
coming down

reactor

costs

their

own.

half

;

are

Some

Government

would

continue

after the

expiration of its foreign
purchase agreement to buy urani¬
abroad and not buy the prod¬
of
our
domestic
mines
and

mills.

Recently, the AEC disclosed
that they are studying plans to
permit uranium companies to en¬

think

ter the commercial market abroad

the

and this may be a first step toward

that reactors they have on
drawing boards will be able
produce electricity at a cost

less

than

mills

without

any

help from the sale of by-products.
Canadian Westinghouse has just
announced" that

with

reactor

which it has developed electricity
be produced for 6V2

can

kilowatt hour.'

mills per

y Only the other day, Pacific Gas
&

Electric

plans

Company announced
build a second nuclear-,

plant in Eureka, California, which
is
expected to produce electric
power at a cost of 8 mills which
for the
be

area

involved

competitive

is stated

with

substitute

toward competitive atomic power
in the United States. It is almost
here right now.

for

fear:

the

Oversupply

third

have

prevalent

oversupply
of uranium? Many people thinkthere is a huge stockpile of ura¬
nium
over-hanging - the
market
and that we have, as the saying
goes, uranium coming tout of our.
ears.
There is nothing to that at
we

ail.
J

-•

According

Commission

ing

milling

and

into

account.

costs

The

are

AEC

taken

estimates

that at the present production rate
our domestic reserves of uranium

No Uranium

Atomic

Energy
officials, there is no

ore

will last

only about 10 years.

Canada

and

have

reserves

ore

but their

grade.
ties

ores

South

are

Africa

larger than
of

both
ours,

much lower

Canada, larger quanti¬

ore

^till to be

.'Free World

milled and the uranium which has

not

been

already

weapons.

fabricated

into

We do not, for example,

have

stockpiles of uranium oxide,
green salts, hexofluoride or ura¬
nium

metal.

; Mr.
of

raw

Jesse

Johnson,

materials

for

charge

the

Atomic

and

the

workmen's

merged.

com¬

reserves

econom¬

ura¬

large for a metal which
to be of such great
importance
in the future
even
apart from its military uses.

this

country.
Our population is
expanding
rapidly,
as
is
the
amount of power used per capita.
Reactor
costs
are
fast
coming

end

of the

1960's.

from

Power

far less business than it does.
When

the

Federal

they

ence

kindly,

looked

were

Selected

upon

Insurance

New

York,

(has consolidated Colonial Life.

casualty

companies
had acquired considerable experi¬

Risks

Selected

Indemnity
and
merged.
*

Risks

Fire

and

started to

fusion

atomic
is

energy.

decades

several

Controlled fusion

its

behind

atomic

scientific

alone and its commercial
-

par

affiliate, American

•

Bonding Co.

United States Fire merged

South¬
Fire, both members of the

ern

Crum

the

Forster fleet.

Hartford

Fire

stock

has

offered to

Northwestern

buy,
Fire

& Marine Co.

This

could

on,

number

of other consolidations have taken

place.

But

number

that

have

eliminated

been

by the merger
route have been replaced by new

incorporations, principally of life
companies. Are we not to wonder
whether

there

not

are

too

many

bull market
life companies? And could another
of life in¬
deep depression not deplete sur¬
surance stocks
were brought into
plus funds at a time when new
the unlisted market.
Few people
writings slowed down greatly?
realize that in this country we
have over
1,200 life companies,
Now Kingsbury, Tingle
•
mostly stock as far as numbers
WASHINGTON, D.C.—The firm
go; mostly mutual as far as fi¬
in

the

equities all

recent

manner

aspects
applica¬
tion is
infinitely more difficult.
This century will probably not see nancial size is concerned.
There
the economic use of power from were rapid price run-ups in many
fusion.
cases,
and
exceptionally
large
■I am optimistic about the future profits, paper and realized, were
energy

table Fire

South Carolina.
casualty company
with its fire opposite. Insurance Corp. of America has
Indeed,
in
one
respect
it
is
acquired control of Marquette
stronger, for, the casualty business
Casualty Co.
'I
being an uncertain one so far as Fidelity & Deposit of Baltimore
the loss potential of its main lines
absorbed its
run-of-the-mill

During

controlled

will not affect the development

name

of Mutual Fund Investments

Ltd., du Pont Circle Building, has
been

changed to Kingsbury, Tingle
Blankenship, Inc.

time arrives.

uranium oxide per year or a little

GRINDLAYS

Christiana

BANK LIMITED

Amalgamating National Bank of India Ltd*
and Grindlays Bank Ltd.
Head Office:

26 BISHOPSGATE, LONDON,
l/)ndon Branches

Securities Co.

E.CJ

Bulletin

Request

SQUARE, S.W.I
PARLIAMENT STREET, S.W.1

13 ST. JAMES'S

With A. C.

very

By 1960, the United States and

AND

OVERSEAS

NATIONAL

mand for uranium long before that

expected

Canada will each be producing in
the neighborhood of 15,000 tons of

;

lines, and the typical St. Paul Fire & Marine has taken
over Western
Life of Montana.purely casualty carrier would do
pensation

ore

nium oxide amount to little more
than % of a million tons. This is

mobile

States except for about a million
half tons

Union Life.

Char¬

•

ically mineable and millable

Travelers Fire.

the various States Providence
Washington Indemnity
legislate to permit cross
merged with the parent, Provi¬
writing; fire companies were per¬
dence Washington Insurance.
mitted to cover casualty lines, and
Gulf American Fire & Casualty
the job.
This assumes a continu¬ the casualty companies were al¬
merged with De Soto Fire of
ance
of the fine type of research lowed to go into the fire
business,
Alabama.
and development in the reactor thus
becoming
multiple-line
and allied fields that have given writers.
Queen Insurance Co. of America
has acquired all the business of
us
the lead to date.
Today most States sanction the
Old Dominion Fire.
Atomic energy wil be needed to cross-writing; and there,, is every
supply growing power needs in reason why they should, for the Boston Insurance acquired Equi-

must be mined and of
the
uranium
industry.
The
yield the same amount Government
purchase
program
oxide, and in South Africa, will take the bulk of the uranium
recovery of uranium is economic produced at least into 1966. Com¬
only as a by-product of the gold mercial atomic energy will pro¬
vide a substantial additional de¬
mining industry.

milled

stockpile of uranium in the United
and

owns

opening up the commercial mar¬
ket generally.: There is bound to
be an open world-wide market for down, and as they come down the
use of atomic reactors to generate
uranium in time. And my present:
electricity will increase.
Atomic is concerned, it usually is consid¬
guess
is '* that ; the
open-market
price will be based on $8 a pound power plants are right now on the erably more liquid than a fire
verge
of
becoming
competitive insurer. Most casualty lines relate
for uranium oxide.
with conventionally fueled plants. to persons, whereas lire lines re¬
By 1975, most of the new electric late to property; and where a
Depicts Our Reserves
generating plants being built in person is involved, losses are much
Let me give you a quick picture
this country will be atomic pow¬ more uncertain than on property
of what our United States urani¬
ered.
By that time, too, we will damage claims.
um reserves look like.
have an atomic powered Navy.
Thus
the
casualty
carrier is
The United States has presently
These large-scale users of ura¬ likely to be well
over
50% in
known reserves amounting to be¬
nium will take all the uranium liquid assets (cash, U. S. Govern¬
tween 75 and 80 million tons of
that
can
be
ment bonds, and other bonds), as
spared
from
the
uranium
ore
containing
about
weapons program. Unless we con¬ it must be in a position to pay
175,000 tons of uranium oxide. This
tinue to find new deposits, we face claims the size of which may not
175,000 ton figure may be on the
a shortage
of uranium before the be foreseen.
high rather than the low side be¬

sources of
electricity production.
They
say
that
the. experience;
gained at the Vallecitos laboratory
in building their first reactor has cause some of the tonnage just
made this possible. This is a very mentioned may be of a grade that
significant
step " in
the
march will not be commercial when min¬

Now

which

auto¬

than its current

over

uct

American reactor designers

our

now

requirement, serves and production.
which, I might add,
At the risk of repetition, let me
it
was
obtaining abroad.
These summarize my views.
foreign purchases were, essential
to
meet
the
rapidly expanding
Summary
military: needs of the past few
The free nations of the world
years,
but AEC contracts with look to us for the
fuel, reactors
Canada and South Africa do not
and
technology to supply their
run nearly as long as the domestic
growing atomic power needs. If
purchase program.
Furthermore, we don't measure
up, the Russians
it is politically inconceivable that
will.
I am confident we will do
more

Costs

Reactor

may

are

well find an
additional important role in many

program, it is
how the uranium i the

see

can

uranium

electricty at

petitive prices and better.
'j.

that

Aliyn Co.

CSpecIal to The Financial Chronicle)

! OMAHA, Neb.—Donovan J. Gerken

now

with A. C. Allyn and

Bankers to the Government in

: ADEN,

KENYA,

UGANDA, ZANZIBAR A SOMAL1LAND pROTECTORATi

Branches in:

Laird, Bissell & Meeds
Members New York Stock Exchange
Members
120

Building.

Incorporated,
He

was

Farnam

previously with

Harris, Upham & Co.

Bell

TANGANYIKA, ZANZIBAR. UGANDA,
ADEN, SOMALILAND PROTECTORATE,
NORTHERN AND SOUTHERN RHODESIA.

Stock

Exchange

Telephone: BArclay 7-8500

INDIA, PAKISTAN, CEYLON, BURMA, KENYA,

Company,

American

BROADWAY, NEW YORK 3, N. Y.

(L.

Teletype—NY

Gibbs,

Manager

Specialists

1-1248-49
Trading

Dept.)

Bank Stocks

The Commercial and Financial Chronicle

prices is

Dr. A. F. Burns' Views

Challenged for

discussed in Dr. Walter
Spahr's review of recently published book by former head

views

any

Dr. Arthur F. Burnt

1957) by Dr. Arthur F.
Burns, former Chairman, Council
in

useful.sens.e.- If the word-

causal

into

factors,

one

hopper

labeled "inflation."

this

principal drive of the ar¬
gument in this little book seems
"The

month's issue of

Dr. Burns is asked to equate the

out Inflation"

prices. The 'inflation' which
has taken place up to date should

sumer

"Prosperity With¬

with occurrence of

confirmed.

prices generally rising following a
"Instead of accepting economic
depression, and to answer implica¬
equilibrium as the best condition
tions raised by his recommenda¬
of
economic affairs, Dr. Burns
tion for a " 'major advance in the
recommends as criteria 'a high and
machinery of formulating and in¬ stable
rate of employment in re¬
tegrating the economic policies of lation to the labor
force, expand¬
our far-flung government.' "
The
ing production, improvement in
Committee's executive vice-presi¬
living stadards, and a reasonably
dent points out, with regard to the
stable consumer price level.' (Page
former, -that a proper and a stable
.40.)
price level are two different things
"Conceivably, the degree of eco¬
and, regarding the latter, the "in¬
nomic equilibrium could reach a
tention of the author in respect to
level at which there would be no
this issue is not a question which
general expansion in production
may properly be left open to con¬
since all the factors of production
jecture."
and forces in exchange, consump¬
The obligations and place of the
tion, distribution of income, and
Federal Reserve
System
under the relation of government activi¬
statutory * law depicted by Dr. ties
to
private
enterprise
are
Burns, President of the distin¬ nicely balanced considering nat-.
guished National ^Bureau of Eco¬ ural

and

sellers who exchange

services, and money
kets

not

their goods,
in free mar¬

arrive

correct

free

' VV

markets.)__.)•):

"Government and central bank

rency being inferior to a redeem¬
able currency, an omission that is
remarkable

considering the great

also scrutinized

omists.

According to Dr. Spahr, "a
markable-feature

of'

this

without

defining: it.

'inflation'

dex of

means

Apparently

rise in the in¬

consumer

prosperity
an

may be attained after
economic depression without

rising priees. Other parts of his
liscussion-suggest that "inflation"
means only a further rise in con¬
sumer prices. As further
examples
the

confusion

which

results

from lack of

definition, Dr. Burns
states, page-12, that 'One of the
plainest teachings * of history is
that rising prices are a recurring
feature of the expanding phase of
the business cycle.'
Cites

"If

►

•

Questions Proper Price Level

;

prices.' But the
title- of " the
book,
"Prosperity
Without Ihflation," suggests that

1 ■

book-of 88 pages.-by Dr. Burns '.
is his use of the word 'inflation' ■;
.

Contradiction

business

expansion means
prosperity and if rising prices
mean
'inflation';
the
question

tary policies
on
was

domestic

greater extent

considerations

than

feasible during the 1920's.' "

.
"And as
mendation

Economic Council

goes

than

farther

specifically

announce

maintain

its

intention

relatively stable index

consumer

prices this 'could

considerable

distance

dissi¬

pating the widespread belief that
we are living in an age of infla¬
Presumably if the govern¬
ment could prevent a further rise
in consumer prices we would then
tion.'

Department of our Federal
government nas much in common
with

the

staff

recommendation

the

1945

the

for

which, if made effec¬
would transcend our Con¬
constitute Executive

Dictatorship. But Dr. Burns does
not pursue the implications of his
proposal to their logical end; he

does

not

state, page 84, that 'The
we can do with regard
to trade unions is to subject their
finances, as well as the election
of their

eral government is one of general

this country is the

Board,

zation of government

debt, tempo¬
rary scarcities, and
many
other
distorting forces should be frozen
into

our

economy.

"Apparently it needs to be
phasized

that

stable

em¬

index

to policy because, he

spect

well

their depu¬

frequency with

tive

should

and

manager,

fit

how

into

the

policy-maker
nothing said
program is to

with

such

Constitutional

our

sys¬

tem.

Dr. Burns points out, page
88, the need for 'better organiza¬
tion of economic policy-making,'
but he does not indicate how Con¬
gress

is to be controlled. On page

offers

his

suggestion

for

'lengthening the arm of the Ad¬
visory Board on Economic Growth
and Stability' to provide a 'major
advance in the machinery of for¬

mulating and integrating the eco¬
nomic policies of our far-flung
government.' What, precisely, does
'integrating' the economic policies
of our government mean? If there
is to be integration in a
literal

and leaves it

"This

Dr.

dangling in space.

author would

Burns

President

agree

with

the extent that the

have

should

the

best

for provid¬

possible organization

says,

management

prosperity"

in the Executive Department. The

duties

ment.'

Who

the

independence of the Federal \

and)

directors

Federal

the

This

banks.

author

Reserve',

is. not

aware>

of any scholarly

study on the Fed-,
System which classi-;

eral Reserve

lies Federal Reserve authorities

'members of the

In-

government.'

event, it is hardly the com-,
practice for 'members of the;government' to be paid by private;
any

mon

quasi-private enterprise.
although the Employ¬

"Next,

ment Act of 1946 enumerates

ious

var¬

with the assistance,
and
cooperation of which
'the
Federal government' is to use 'all
groups

practicable means' to foster and)
promote 'conditions under which,
there will be useful employment
opportunities, including self-em¬
ployment, for those able, willing,
and

seeking to work, and to pro-)
employment, pro-,
duction, and purchasing power,'
the Federal Reserve System is not
among
the groups or. agencies
enumerated.
According
to
the
ejusdem generis rule of statutory
construction, the law applies only

mote maximum

the

enumerated

items

when

enumeration.

there is

"Still further,

the statement of
in the Employment Act
in nature.;
It is transposed preamble material
which belongs to a resolution; and
purposes

of 1946 is not statutory

preamble material is not binding

ment

for what

this

dictatorship—,

from

subtle

our

all

and

can

author
to

indirect

attacks.

amendments should be

proposed."

Open to Conjecture

integration by "government" (the
Executive?) of economic policies,
cannot

properly be
charged with making proposals in
this book, which, if made effective,
would
necessarily reach beyond
Dr.

our

Burns

Constitutional system—except
he

may

government

regard the
as
having

Federal
general,

delegated, powers. On
other hand, if an Executive

rather than
the

which may properly

be left open

ito conjecture.

pre¬

treated

when

recognized

they are and should not
law

statute

such

even

the

follows

material

enacting clause of what is other¬
designed to be a statute, at)

wise

least in part.
"Dr.

that

Burns

states

page

'serious

depressions are no
longer the threat they once were.'
.

.' A question arises as to whether
assertion is supportable by

that

the methods of science."'

New York Stock Exchange

Weekly Firm Changes
The New York Stock Exchange
has announced the following

firm

changes:
Alexander B. Griswold and Ara¬
L.

bella

Griswold

trustees

under deed of trust dated Jan.

1958

will

partnership

admitted

Alex.

15,

to limited

Brown

Sons.

Transfer of the Exchange mem¬

bership of the late Arthur W. Ackerman

to Paul W. Doll, Jr.

will be

considered March 20.
Transfer of the Exchange mem¬

bership

Donald

Samuel Wechsler

Snell

will be consid¬

ered March 20.

Transfer of the Exchange mem-;

"The meaning of
is

should

statements

"By failing to carry to their
logical conclusion the implications
inherent in a program proposing

It carries

statutory provisions to be en-^
forced, and it provides no penal¬
ties for failure to carry out the
announced purpose, plan, or de¬
sire.
Transposed preamble-type

inadequate,

Constitution is

enforceable.

nor

cise

hoist

and

rights of Congress in
this area, as outlined in the Con¬

'members of the govern-*

are

ing him with the best possible in¬
and advice; but when
programs
for Executive policy¬
making or management of mone¬
tary, fiscal, and economic affairs
are proposed, and proposed along
with acceptance of irredeemable
currency—a basic tool of govern¬
formation

Dictatorship could be established,
with Congress required to abdi¬
cate its functions and responsibil¬
ities, the Burns book provides an
excellent blueprint for such a sys¬
comparable to that of the National
tem. In the opinion of this author,
Security Council in its sphere.'
the intention of the author in re¬
(Page 87.) Thus is it proposed to
place economic policy-making or spect to this issue is not a question
"the

they

proposals are made that; Reserve authorities of both Con-;
there be integration of our mone¬
gress
and - the
Executive
even;,
tary and fiscal affairs, and some¬
though the Board is required to*
times
other forms
of economic'
report annually to Congress. The;
management, •. the common
im¬ Board's staff is paid in the same
plication' being that the Execu¬ manner as. are all/ officers

a
flag of warning in an effort ito
help protect our Constitutional
system and appropriate liberties

stable

ments
in prices
resulting from
overextensions of credit, moneti-

Federal Reserve authorities in re¬

which

to the Burns recom¬

confirmed, and that maladjust¬

Employment Act of 1946,

according to Dr. Burns, binds the

...

Status of Federal Reserve
"The

prices,

Burns

Federal Re¬

authorities."

wishes

sometimes, as, lor,
37 and 40, it

pages

to include the

seems

serve

program

tive,

example,

Administration

the

Congress;

and

the **

Administration;,

refer

seems

sometimes

and fiscal
Executive,

monetary
under the

integration
a

C.E.D.

program

least that

analysis is to the effect that
ties, in full attendance
A con¬
the
index
of
consumer
prices sultative
body would come into
arises as to how we are to obtain should be stabilized at the highest
existence which would
carry
a
"Prosperity Without Inflation." On level in our history, that the very
weight in decisions on basic eco¬
page. 70 he expresses the belief great losses to which savings have
nomic policies that would be fully
that if the Federal government been subjected
since 1939 should
would

utive

eering, and other unfair practices, ment, he stops short of dealing
that is applied to entrepreneurs. with this most fundamental issue

powers and that it may properly
index of: do anything.it
may be disposed
presumably at* to do to foster what it may regard
the
present level:
This author as, or label, 'the general welfare'
would
contend -that
the
only without facing any Constitutional
proper price level is the one that
restrictions.
Indeed, the Consti¬
prevails in free markets, under a tution of the United States is not
fixed monetary standard and re-* mentioned in this book.
deemable currency, without mone"Apparently, in the opinion of
tization of government debt and
Dr. Burns, policy-making in re¬
with all credit automatically selfspect to, and presumably the man¬
liquidating, with the government
agement of, the economic affairs
acting as umpire to insure free of the Federal
government should
and
fair competition,
and that reside with the President who
flows from, and reflects, a high
should be guided by an Advisory
degree of economic equilibrium. Board on Economic
Growth and
If productive activity and
effi¬
Stability. The 'climactic meetings
ciency increase relative to de¬ of the Board would be conducted
mand, there surely is no valid with the President in the
chair
reason why prices should not fall
and with the heads of the depart¬
or why the value of people's sav¬
ments and agencies represented on
ings should not increase.
The the
consumer

Economic

Stability in the Exec¬

"Although the Burns program is sense, then the division of author¬
designed to provide a high degree ity and responsibility under our
Constitution logically disappears.
of
government management
in
Dr. Bums does not face up to this
monetary, fiscal, and other eco¬
nomic areas, he does not propose issue as he outlines his program;
that organized labor be subjected like the common run of our ad¬
to the same variety of regulation, vocates of integration in govern¬
in respect to monopolistic racket¬ ment policy-making or manage¬

the Burns' book.
One may infer
from his discussion that the Fed¬

author, lacking in validity."

re¬

little

'Surely, the breakdown of the in¬
gold
standard
has
made it possible to base our mone¬
ternational

ings,

University,
by one of the
country's leading monetary econ¬
is

Board

Executive

"Various questions arise here:
are Federal Reserve author-;
point out that, if his
ities?
Although the members of
plan is to be successful as a device
the Board of Governors are ap-;
for Executive policy-making, Con¬
pointed by the President with ap-"
gress must do as directed, or that,
if' Congress exercises its Consti¬ proval of the Senate, they are paid
out of the earnings of the Federal'
tutional authority and responsibil¬
Reserve
System and
the Civil<
ities it can, and may, render his
Service Act is not applied to the;
program
for *; Executive
policy¬
officers
and
employees of the;
making ineffective.
.:t '}
System.
Those provisions were/
"A noticeable phenomenon in
written into the law to establish;

millions of buyers

officials, to standards de¬
population, sav¬
capital goods, and intelli¬ fined by kiw.'
"The nature of our Constitu¬
gence. Insistence upon expanding
production .regardless of restric-. tional system, and the duties and
tive
factors which can
and do rights of Congress under the Con¬
arise is, in the opinion of this stitution, receive no attention in
resources,

nomic Research, and Professor of
Economics at Columbia

Advisory

Growth and

while the

harm
which
irredeemable
cur¬
Monetary Notes,
a news letter on
monetary affairs to be that we should maintain rencies have brought to mankind.
The only statement made regard¬
published by Economists' National
present prosperity and 'full' em¬
Committee on Monetary Policy (1
ing our departure from a gold
ployment, expand production, and
Madison Avenue, New York 10,
standard involves a note of ap¬
improve living standards, without
N. Y.).
\-v7-V-'" proval. Says Dr. Burns, page 53:
a further rise in the index of con¬

title of his book

for

recommendation

stitution and

index

the

"His

officials through a
process of subjective
evaluation
can or will specify correct prices

policies V should ifoster economic
or,its, rise above a selected point,,
equilibrium;, and, if that is ap¬
he could have added clarity and;
proached or attained in any high
precision to his ^analysis by -re¬ degree, .the price level which flows
ferring to a rise in that index andj from / it: should; be correct, and
by avoiding an elusive, undefined ; reasonably steady./An attempt to
term,;which, though in common; stabilize a.
price lever regardless
use; is rarely defined in a scien¬
of the forces of maladjustment
tific manner.. Since prices can rise which
may prevail is a case of
because, of many forces, the pro¬
putting the; cart before the horse.;
cedure of scientific analysis is not
"Dr. Burns says nothing about
furthered by dumping all types of
our
system of irredeemable cur¬
rises, with their great variety of

York,

Advisers,

have

prices. A simple fact of economics

nothing, more than a rise;
of consumer prices,,

means

Economic

should

1920's

•

the

"Many questions arise out of Dr.: is that the only correct prices are
Rurns's failure to define 'inflation',- those determined objectively in

1930's.

flation since the
-

Walter E. Spahr

Eisenhower#

living in an age of infla¬
tion. Yet, on page 42, the author
points out that we have had in¬

(Fordham University Press, New

government

not be

Spahr critically re¬
Prosperity
and Inflation

us that.
Furthermore, the
fixing of prices or the stabiliza¬
tion of the price level, if that is
possible, by government or cen¬
tral
bank
action, is an act of
dictatorship which rests upon a
fallacious assumption that a few

price level, are some of the questions

Dr. Walter E.

nothing

taught

our

Economic Adviser to President

ences

far-flung government; (2) are Federal Reserve
authorities members of government and come under Employ¬
ment Act of 1946; and (3) is a stable price level a correct
E.

reveals

harmony or lack of harmony
price relationships. Our experi¬

(1) What happens to Congress and our Constitution should
have ail economic council that integrates all economic

Thursday, March 13, 1958

times

Discusses Implications

mathematical abstrac¬

the

policies of

a
which

tion

Implications and Contradictions

(1168)

the word 'gov¬

obscure

stitution of the United States, are

ernment'

not discussed by Dr. Burns."

places in this little book.

various

Some¬

bership of the late Allan L. Melhado to Frederick A. Melhado will
be considered March 20.

dumber 5724

Volume 187

I The CoftimerciaX "and Financial Chronicle

(1169)

1957.

(Basically,
however,
the
long-term trend toward increased
use,of
electronics in advanced

K.'-'-A

;

-;?•

•

Chairman of the Board and Treasurer

;

By ROBERT C. SPRAGUE

Spragiie Electric Company, North Adams, Mass.

Reflecting the-view

by parts manufacturers, Mr.

seen

ff 1-edentlv Is^195^and

•

•.r

lCela

Cn«

n,,t»

for

PAUL, Minn.—The Market
C°rP°ration has been formed with

the

such

pro-

depends

Vice-President; James E. Klingel,

TreasurerrAlhareT associated with

pens to *>™iness generally, but T

«|at »e electronics In- ^an & Moody, Inc.
continue

grow,

L^ctory'sales" Tldl Issumes9" North Central Sees.Formed
level of home entertainment busi-

use

of electronics in

wide

Securities, Inc. hasvbeen' formqd
with offices at 119 West Washingr
ton Street. Officers are RusseB
Knudtson, President; Roy Knudti1
son, Vice-President,*1 M. Knudtson,
cPr,rpforv»

at xne lactones comparea to ^l.u

•

(special to the financial chronicle)

OTTAWA, 111.—North Central

ness unchanged from this year,
vaHptv
nf
industrial
and
some increases in procurement of
• .T • .
y .
.x
xj
.xt electronics for defense and in instrone ' cmwth
trend
in
1957
dustrial and commerciai equipg total of 81 2 billion ment> and continued growth in the
.
factories combated to 81 0 imP°rtant replacement market fbr-

bin^ions
with radios and TV sets,
reached a new high of over five

economy, as a

one-third

l^lilve

Industrial-Commercial Usage
The

S Si^
v P
?^0frao^^a?ily.1^m
become^ ob- Player output, ap^^f rpm _com-

SneSS>1?ew

progress

;

serious;^questions 2Q% mciease m auto radios. Sep-

ahead.
Forit ..has
;V«>us,Jn -recent ;iponths that the

that

curement will be for electronics..

continued replace¬

one/

•

number-, of

r^Vrobablt'

toat

expanded electronics defense volume.

market demand, and

Form Market Corp.

we :

1957*as a"year

™?ssfle
eS"r™!v electronics indus^despSe th<«**».
East Sixth Street to
Seto accelerated this trend In many unpredictable factors ap- SS??ge
» securities business.
SI 1957 sS 23% of S bl Peering on the scene in the latter ™fteers. are'Budolph S. Juran,
DerartmLt Drocurement
-Alsaker,
.Department
procurement part of the year. How good 1958 Presidetttf..Charles
wjjj

higher doliat value due to slightly higher prices, and

ment

inues' an4 of substantial

sf fms c°

marked increase in color sets \ continued radio-phono growth;
Usages;

look back

can

.».

I believe that

obviously

amounting to $7 billion in 1958. This is based on an assump¬
tion of: TV black and white sets equalling 1957 unit figure,

increase in commercial-industrial

conclusion,

lense

Sprague anticipates continued growth for electronics industry,

with

Conclusion;
In

and

uxius, bxceeding^eveh:the
CACccumg even uic
—"«•
~x
....
iwholevhashot«^
.billion m 1956. This segment
of p|^s
annUallv-^hfrrlnt Ttealurer'
: postwar peara,
befell^' ihbih- '
hiisiripcs has ' tthereto
h #* r * f n r
fr Jpo«y
inuuon such
annually.
Vurreni
in 1947 and reflect- mir
out -business
rfe
Conditions^are
however
that .xiectturei.
r
ing an increase of approximately achieved.an importance equal to SflffW1* ,^eJer'
-taining the
50% over 1956 in high-fidelity that of the home entertainment
levels of outYYY
Forms

Knudtson,

nuuiuii:

•

Republic Sees.

put, employt

m e n

(Special to The Financial Chronicle)

ing

ptofits, which
ii a d t> e e n

•

fact

we are

the .midst of

•

5
.

.•"*

"°bert Ci Spra,U*

Estimates Radio, Phonograph
Estimates Radio, Phonograph

And TV Sales

;iype

that last occurred in 1953
and early 1954.
The extent and
.duration of the decline iii business
activity are not yet clear, of
course, and in the
dustry the problem, is
by some very sudden

Prospects
terta'inment

continued

...

for
,m

1958 in
ark ets

growth

softness' in

the entertainment
market
during
the ' fall
months. Despite a number of important unknowns in the current

:picture, however, 1957 in total, set
a new peak
for volume in the
electronics industry, and a number
of companies ^were able to show
somewhat higher profits.
Total
value of factory sales for the in^ dustry appears to have come to
labout $6.8 billion, representing a
•

communications equipment, in^
and inatruinenta-

yfi:[-tion, and I look for
the

F?cr?a5e ?

en-

are

radios

„

VnrkF

for'®® industry s sales to.these
kets. From,the standpoint of.the securities
...

and

ritv

pnM^p

offi«rs

(Special to The Finan«al, CHronic)1e)

TAMPA,

resulted

form

1958, range from about 10% below

logical

10% above this year; my own
'
would be that black-andwhite sets will do well to equal
the 1957 unit figures, but that
their dollar yalue may be up refleeting
slightly, higher
prices,
With respect to the longer-term ->
outlook for television, it is important to keep in mind that more ;.
than 80% of the nation's 50 mil-

broad range of sensing and ' .and Mr. Gress were
functions.
Sutro Bros. & Co.

•

;

guess

;

e
.

black
f

television,
and

production

white sets

;
of

remained

reach one million sets by 1960.

reflecting a need to • work , off
fairly largeTriyentories on hand

our

start,feand in

more recent

months the

failure, of retail sales
anticipated levels. Sales
©f sets to. the public were about
on
a
pair with 1956 - through
August, but sihCe then have fallen
behind, with thb result that only
to reach

about

6.5

million

sets

were

sbld

; at retail against earlier expectations of 6.8 - 7.0 million.; Ih order
•

prevent

accumulation of

cessive i

n v e

makers

have

o r

e s,

ex-,

most set

followed

very

conservative

production p o 1 i c y
during the fall -months, and total
factory production probably did

should again show a marked increase, and it seems entirely possibje that color production could

b^ow 1956: throughout the year,

at- the

HUDSON

entertammentH segments

j previous year.

!
■

Turning to .military electronics,
industry recorded a 13% in-

in shipments to $3.4 billion compared to $3.0 billion in
the calendar year 1956. Hbwever,
total • expenditures
for military.
procurement
fluctuated -u sharply
during the year, rising to a very ;
high level toward the close of. {
the fiscal year June 30, and then
being sharply cut back when it
became apparent' that the prevailing rate would soon result in
*
exceeding the legal debtv ceiling,
crease

Beginning in late summery therefore, the armed servicesfreduced
their outstanding procurement ob-.
ligations and began withholding

we
j

million in 1956. This drop in pronot only in

-.duction- has• resulted

For 1957

making
brought

;

c Q.m

taihlpent• -field' Were-radios

aridx pated ;$38 billion rate.a% not out!.

-jdyedvSubsta^tjal^sales fgains 4n'
t1957fr Totemsradte production" ap-:
pears to haye exceeded i5 million.'
>sets .for ti>e first ^time -since 1948,.
as a. result of a small gain in home
set production combined with a

the electrohics industry

be
fa^'^th;-^c6htinujationl;qf- the
will

level of procurement that'
has'characterized the late fall of

lower

new

Securities

Continued Area Growth

High Construction Activity
Sound Financial Position

.'
'

■-

:
^

For 1958

%>?-•-

[

;

•

^I^rgest Construction program in the
■i

Company's History

CortsecuHve Dividends Paid for 55 Years
~-

uncertain,"' arid in the: meantime*" r,

$11/4 -Millions in

•'

ing of any such increase fs^^ highly;

9% Growtli in Income

phdnographs^both' Of- which eh-, of the question; however, ^q.tim-;1
:

Report;

•

••

our

;

pah i e s^ but also demand for' electronic equipment*
about' generally flower in the^ fall months. More recently
sales volume Tor component parts * there is some evidence that, stifnFfakkefs< in the Tburth ^qharter.' ulated' by the effect of the two* .
^Color : television, although; show-" Sputniks7"on U. S. thirikihg and;,;
an inipoH^ht
ihfcrease, over-on
factors, the * Federal •
1956, $d riot contribute, tnateri-. -Government has., changed - its, pql- "
f
ally t6' toltal • set vblunie; -it" is. icy and that defense expenditures *
brhfeabld that 'total color produc-' can -.be expected .to go. back to; •
tioh caihe to 200-250^000 sets coni-. their former level and"possibly.
| pated to 130,000 fast year.
=
- ta exceed ft.
In fact, " an increase
; -.The-bright; spots, inv the <enter-. of $1-2 billioh overt the antici•

■

| reduced " employment v ih „the; set : sile makers, substantially reduced
;•

Showing:

suing production cutbacks, par-'
ticularly among aircraft and mis--,

send you a copy

1957 Annual

j- not- exceed = 6.15 million versus 7.4 the placemeht of new orders; en-^
.

)

been

formerly with Bishop Vice-Presidents; and J. B.
Bryan, Secretary-Treasurer,

the

from

S\w.es"of'c"omponents to" wi-\Secretary-Treasurer. .Mr. Belfert President; J. A. Potts and J. T.
of the unit volume of TV sets ih

ket is increasingly dependent on' '
of replacement and second-set deour business, the "home entertainmand. Probably close to one-half
ment market showing no change of all sets sold in 1958 will be
from the $1.4 ^million level of the for replacement. Color television

increase

Invest-

< over the $6,1 billion lion homes now hay^ television,'
.figure of ^ 1956.^: .Virtually all of with the result that the set mar- ' / ;
non

Fla.—Sound

Incorporated"' has

are

buanras^Officera^ are

J12%, < gain
this

South Inv.; Opens

continuing .America has been formed with

10-15%^ per yeai in

■'

^
Peoples Planning Corporation of

dustrTal^ control

;;aSthf year® aTw^nsTle-1

;

Brucq E.

•

'S^lfp0rof ha

—

_.gt,

readjustment,

:gr'eeof

PASADENA, Calif.

of the radio-TV
of the most important areas of

use;

Thornton is engaging in a securiindustrial electronics is ;in elec- overall econo^
economic situation, as well nes
ties business
from: offices at 76
0
tronic compute*s
computers for
foi business and
ana .
.•n/31-.n-Htiar ***** ™hinh
South " Sierra
sierra
Bonita under
the
scientific
use. The
The Value
value 'ofthese-1 as
® in the individual areas which bourn
south sierra bonita under the
scientific use.
of these
machines this year was close to
Speclal
of
our
firm
name
of
Republic
Securities
machines this year was close to . jbusiness.
Company. He was formerly, with
$200 million compared to $50 milDaniel E. Weston & Co.
shows every indication of continu- lion as, recently as three years >, ,
•
;
ing m the years ahead.
•
•
J
^ ago. Good gains were also shown . I Peoples' Planning .Corp.

years,

transistor

iraiisisiws,
con.pared
25% in
transistQrs,
compared to 25%
the
preceding year,
year. i Transistor
Transistor
Production
approximately doubled
doubled
production approximately
in 1957, to a total of about v$65
million. This rapid growth rate

of t he past

abd;that

increase

nade used
used some
some
45% .of all radios made

characteristic
.'several

•

li d

■

Central Hodsan Gas & Electric Corporation

Poughkeepsie, New York

The Commercial and Financial Chronicle

re-editing the drafts of a trust
agreement. In half-complaint, he

Developments ia Employees Tmts
:
And the Mattel of Earnings
Trust

seen

over

said, "it might not be improved,
it can be changed."
Not

but

National Bank and
Company of Chicago

merely changes but what are re¬
garded as needed improvements
in the Code are illustrated in sug¬

$40 billion set aside for employee retirement

gestions made in recent hearings
held by the House Committee on
Ways and Means. Illustrative are
12
suggestions relating to em¬
ployees trusts advocated by the
Illinois State Chamber of Com¬
merces

proposals

other

Among

have been those of insurance rep¬

would have the

resentatives who

mutual investment funds,

from themselves rather than from

could not be changed.

plans
other than social security and an incremental growth of $4
billion, Chicago trust executive quickly reviews environmental factors at work and steps taken to offset price inflation, including collective trusts, and deals at greater length with the need
for banks to improve their net earnings. Mr. Bronston cites
data showing commercial banks encounter competition in fees
With

practicing law he had never
draft of a document that
"Of course,"

BRONSTON*

By CECIL P.

;

remarked that in his 30 years or

Vice-President, Continental Illinois

law

permit

changed

profit

investment counselors and insurance companies, and sets
forth a four-point program to achieve fees to cover costs.

sharing plans to provide annuity
benefits proportionate to compen¬
sation and to permit use of group
In, our tremendously interest¬ eluding Social Security, have now annuity contracts without inter¬
ing trust business almost all of grown to a value some have esti¬ vening trusts.
life passes before us. In the com¬ mated to be as much as $40 bil¬
Revenue Ruling 57-1C3 provides
ings and goings of our customers, lion, and annual additions are said that the amount paid to a pen¬
to approach $4 billion. Some esti¬
whether
they
sioner
at
early retirement age
mates for the future seem to take
b e
personal
must not exceed his vested inter¬
us
so
far
off
into
space
that
we
or
corporate,
est at that time, if the early re¬
could join the scientists in calcu¬
we
share
in
tirement is subject to the consent
lations of where our pension fund
the
routine
of the employer. In the Chicago

satellite

and the event¬

their
In

work

pension, profit
sharing, and
em¬

ployees trusts
/we are part of
Cecil P. Bronsto*
an
economic,
political and
social
movement,
the ultimate
course of which is yet to be deter¬
mined.
In

degree or

one

have

officers

"whether

and

likes it

one

not

depends on one's philosophy." For

part, I find it difficult not to
like a premise which leads more
and more of our citizens to be¬
another, trust come owners in our nation's busi¬

lived

these

with

nesses

nonetheless for

owners

—

bring into focus certain items
especially current interest.
I should like to borrow a minis¬
terial technique and use a text
around
which
to
organize our
thoughts—a dual text, taken from
the respective sayings of two men
who
lived
in widely separated
times and backgrounds. Leo Tol¬
and

investment funds."

relative.

We must remember that

pensions

and

tributions

woman

can

productivity.
a

ruling

has

natural element

Thursday, March 13, 1958

is to serve other

for

determined

avoid

the

that service and, in so
doing, to expand our pay. These
aiptis are in the highest ,and best
traditions of our economic system
and are worthy Of the'best that
is in us.
/
'
> : Specific items to note on today's
horizon classify loosely into three
categories:
environmental
facts
within which

ducted;

our

business is

.developments

We Work
area

want first to note that the assets

aside for

private

employee- retirement

and

public

funds,

little fear for

ex-

that

the

funding

American Bankers Association,
York City, Feb. 1Q, 1958.

retirement

benefits will not be plagued with
of financial

needless, multiple

New

substance
paper

Internal

work.

matters

concerning the
Revenue Code and Reg¬

ulations

The Mills
House

always

are

interest.

bill, which passed the
Jan. 28, contains a few
significance for us, the

items

most

important,

the relaxation of

perhaps,
the

ban

being
on

the

purchase by qualified-trusts of
the employer's unsecured deben¬
tures. For the most part we have
settled into an acceptance of the
tax advantages and the limitations
of the

Code, but there will always

be those of

sible.
an

This

who think that im¬

continue
reminds

attorney friend
and

others

to
me,

pos¬

what

said when
editing and,

once

were

be
of

companies

with

business

should

prove

act is

passed.

So, in management's view, what
has been introduced by UAW un¬

seeks

our

resulting
helpful to

Fifth, the continuing influence
on

employees trusts exercised by

unions is

seen

in the United Auto¬

mobile Workers' program for bar¬

gaining in 1958.
cludes

these

The program in¬

demands

relative to

special field of interest: in¬
and
liberalized pension

creased

benefits at retirement

disabil¬

ity;3

periodic automatic adjust¬
ment of pensions to living cost in¬
creases;4 reduction of eligibility
for

vesting of pension benefits to
regardless of
a voice in the investment of

five years of service

age;3

termed

profit

the

that

the

adjust¬

We all know that certain

longcompanies

insurance

seeking authority' to issue
annuity contracts, that

are

variable

others oppose
a

few

the move, and that
companies have been
specifically to
deal in

new

formed

John Hancock

variable annuities.

for

Life

Insurance

still

different

Company
legislation in Massachusetts

approach,

proposal correctly^'the insurance
company would be permitted to
establish segregated asset accounts
for pension plan business in which
equity investments could /reach a
proportion of 50% or more. Bene¬
fits could be flexible in nature,
but would carry a minimum guar¬

much

too

have

unions

labor

Economic

Analysis
Power,"
was

of
Labor
completed

observation of his that much more

return..-.with

dollar

anteed

experi¬

adverse investment

from

the

of the plan responsible
deficits that might arise

sponsor
for any

appreciation could be
used at the sponsor's will to in¬
crease
benefits, or to reduce the
cost of the plan, or to gear bene¬
fits to a cost-of-living index.
In
Asset

ence.

Continental Assurance
the American Na¬

Chicago,

Company and

and Trust Company
formity, much that is vital to the have joined forces in a new splitcompetitive
character
of our funding arrangement. The insur¬
economy,
and which is respon¬ ance company offers a combina¬
sible for its high efficiency, will be tion plan through the medium of
lost through a substantial invasion a trust with the bank as trustee,
under which at least 50% of all
of the management field by labor,
the

economic

public will awaken

control,

which

never
would have been tolerated in the

businessmen,

into

passed

someone

the

al¬
hands of
has

We are not direct

parties to the
auto manage¬
ment and* auto labor.
However,
we
certainly should be and are
deeply concerned that the spirit
of true profit sharing, which tends
to unify rather than to separate,
shall not become a casualty as a
mere pawn in a battle to deter¬
mine who runs the auto industry.
struggle

between

l-tt'

V-

•<.;

Plan

Changes in

-j>

benefits to

In dealing with our second main
category—developments in plan
and
service
improve¬
ments—we note that this year has

further increase of interest

plans having other than fixed

benefits,

plans

which

at¬

tempt benefits with some offset
against the decreasing purchasing
power of the dollar.
That profit
sharing plans have been set up
in increasing numbers.may be at¬
tributed, perhaps, to the basic fact
that profit sharing has proved it¬
self and

that its users, once con¬

its advantages, tend to
deeply
evangelical
in
spreading its gospel. Also, many
smaller companies have been set¬
ting
up
retirement plans for

verted

become

which

they

sharing

have
a

cases,

by the insurance
with the remainder to

contract

der

company,

invest¬

be invested in a collective

ment equity fund

operated by the

bank.

moves

These

are

to meet

competitive advantages of
pension funding by way of trust
funds, and to offset in part the

chosen

natural

profit

medium.

with variable benefits,

plans

insured

conversion

trust fund plans.3
Growth

The

of Collective

Trusts

brings us to collective in¬
vestment trusts—a subject that is
This

the

say

kind

how

are

hearts of more

many

now

and

the months go by.

trusts of this

in operation would

I know of 32,
and there could very well be from
40 to 50 either in being or in
be merely a guess.

benefits

Bank

contributions will be invested un¬

}

Meet Inflation

seen

tional

the

else."

contention

invasion forces that would
management's functions. Dr.
Edward H. Chamberlin, Professor
of Political Economy at Harvard
University, who helped to reori¬
ent
professional thinking about
business monopoly 25 years ago in
his "Theory of Monopolistic Com¬
petition,"
now
contends
that
ing

usurp

reasonable

reserves

several

"pension plans with spe¬
cial funding." If I understand the

part of the pension Further, many firms having basic
housing, health, and pension plans have supplemented
community needs in the commun¬ them with
profit sharing plans.
ities in which pension fund mem¬
some
pension plan re¬
bers reside; a sharing of pre-tax And in
profits above 10% of capital, to be visions the offset to inflation is
split 50% to stockholders and ex¬ attempted by basing pensions on
ecutives, 25% to employees, and terminal
pay — most
often with
25% to customers; and substantial
increases in SUB benefits under fixed benefits but, in some recent

the

closely
variable

guise of profit sharing is
merely the Trojan horse conceal¬

The Impact of Union Demands

most

der the

ready

our

Third,

Mutual

organ¬

The experience of Canadian

trust

who already live

customers.

ponents.

hold

in glass houses. But we certainly
have a deep and abiding interest

provements
address by Mr. Bronston before
39th Mid-Winter Trust Conference

*An

the

can

dens

The Environment in Which

set

Disclosure

funds,

sion

established

hands

legislation similar to
the Jenkins-Keogh bill is now in
effect in Great Britain and Can¬

the

1952,
by
Annuity

annuitant who has received fhced

sharing for
union members is joined in
a
package by which the UAW also
attempts to take a hand in deci¬
sions concerning company policies
and prices, employees other than
union members, and dealings with
of

demand

associa¬
people,
through

deduction limit of

and

dollars.1?

be purchased at retirement, is,not
at all acceptable to the bill's pro¬

ada.

leading to the disclosure of infor¬
mation about,, and the further
regulation of, welfare and pen¬

plan

ly of certain items in the first two
categories, it is because I want to
deal at length with the subject
of our earnings.

environmental

legislation

regulations which result in bur¬

benefits
and
service
improve¬
ments; and internal developments
our business by which we seek
to
improve
the
net
earnings
gained from the work that we dp.
If I pass over or discuss too brief¬

the

the matter

Federal

and

state

con¬

It is

spective today.
of

improve

on a

watched

ticed, is really an issue in the
forthcoming negotiations.
The

that

$500 per year. 'This, in t6rms of
the resulting annuity which can

for hire.

prac¬

day to find that a degree of

contingent

and

continues

known

best

July,

Insurance

Association

nuitant has fared better than the

successfully

and

has endorsed the bill in principle,

established

Teachers

it is normally

conceived

one

and

—

lic

profit, sharing,

man—the exchange

service—our labor

Let

The bill has

duce

We constantly aim to broaden and

has

experienced in their short lives.
College Retirement Equities Fund,

annuity programs in effect.
Al¬
though these plans have yet to
pass the test of truly adverse cir¬
cumstances, so far, the CREF an¬

now

are

Plans

sharing proposal that
received
greatest attention.
us hope that the general pub¬
will not come to think that
profit

ever

with

our

door

the

which

annually and $100,000 for a life¬
time is too high.
The AFL-CIO

of pro¬ philosophy of all man's business
service; foij other pro¬ with man: even in retirement,,
duce and service. In any event, man exchanges produce for pro¬
we know, that, in th^s
tyvjsiness of duce/
employees trusts we bring these
Perhaps our second environ¬
two texts together in extending
mental facb looms largest in per¬

the
of the trustee's house, it is

loss

ization, the American Thrift As¬
sembly. Congressional support is
strong, although some apparently
question whether the ceiling limit
on
taxable deductions of $5,000

deep

accepted,

decisions,

could turn out to be a foot in

than

revenue

working
their recently established

Jesus Christ expressed
dignity of service in plants, and resources—from which
these few words to his disciples,
industry can provide the produc¬
"The laborer
is worthy of his
tivity necessary to the pensions
hire." Perhaps these two thoughts, and
profit sharing distributions.
when brought together, state the Thus we make the circle complete
philosophy of all man's business and can hark back to the stated

people."

Apparently the Treas¬

who

investments.
Such in¬
vestments supply the capital—the

vestment

noteworthy. He said, "It is more
than possible that, especially with
the drive for industry-wide uni¬

the support of almost all
tions
of
self-employed

huge

Although the demands for in¬
and liberalized pension
benefits are substantial in nature
and the demand for a voice in in¬
creased

self-em¬

enable

would

Benefit

A Look at Variable

During the -last year orso,with
rent rate of payments at 5c per' common
stodk prices
declining
hour.6 The three major auto con¬
and the cost-of-living index ris¬
tracts
expire late in May and ing, variable annuity plans have
early June so that negotiations, been operated in an atmosphere
are in the offing.
dissimilar to anything previously

prior to the UAW demand for
profit sharing, which makes this

claims would result.

the l^ark
of financially sound
pension plans. Advance funding,
in the aggregate, tends to make

any

cur¬

Union

Department
continues
to
agree with the principle of this
bill but, this year, seems even

Advance funding of some
substance is normally regarded as

companies'

should look briefly
on the progress, or lack of prog¬
ress, of the Jenkins-Kcogh bill
we

ury

in profit shar¬

the

1958, retroactive to Jan. 1, 1958.

tirement.

profit sharing dis¬
be paid only from
Advance funding is

without

made

can

increase

power and argues that it should
be curbed. His recent study, "The

ployed persons to claim tax de¬
ductions under certain limitations
on
funds set aside for their re¬

Size is always

ments

ruling was issued in 1957, all cal¬
endar year taxpayers must make
their amendments by the end of

which

ing.

stoy, of Russian aristocratic line¬
age, said: "The vocation of every

the

this

Fourth,

the the fact that their fellows are also
years,i and today they are gener¬ members of the same pool of own¬
ating and carrying on many of the ership.
developments which we shall note.
Nor dies it seem that we should
What I shall try to do is to review be concerned unduly about "huge

and

Revenue

Internal

the

caused
inquiries than any other is¬
Berle, Jr., writing in a pamphlet sued in
years. To avoid violation
just released by The Fund for the
of the ruling, early retirement
Republic, concludes that the in¬ can be
permitted in the plan
vestments of employee funds in without the consent of the em¬
common stocks are " 'socializing'
ployer, or early retirement can be
property without a revolution . . .
omitted entirely from the plan.
'it;is one of our most amazing
Plans now violative of the ruling
achievements," Mr. Berle says,
need to be amended and, as the

trusts and their progress over

man

office

Service

dealing with

other

Re¬

funds

sorrows.

our

orbit.

its

find

will

gardless of future fancies, today's
are of such size that A. A.

ful,
in their
joys and in

;

(1170)

of formation. In less than
few of the trusts have
grown to have more than 100 in¬
dividual trust participants,
and
certain of them have attained val¬

process

two years a

ues

totaling around $20

million.

the least, the Investment
climate of these two years has

say

provided our staffs ah interesting
environment
launch

within

these trusts

which

and carry on

operations.
To
illustrate what I mean, units in

their

our

investment

Continental Illinois Fixed In¬
Fund and

Equity Fund, re¬
could,,be acquired at
values
to
yield from lows on
March
31,
1956 of 3.69%
and
3.27%, to highs on Oct. 31, 1957
of 4.59% and 4.45%. As a coinci¬
dence, on Dec. 31 last, units of
both funds were at identical yield
points, 4.35%.9
In general, cus¬
tomers seem to be pleased with
their
participation in collective
funds and to regard them as a
come

spectively,

definite extension of
The

Need

our

to Improve

service.

Our Net

Earnings
The fact that customers receive
the advantages of

collective trusts

Number 5724

Volume 187

increase in cost

The Commercial and Financial Chronicle

...

inde-

over

pendent operation of their sepaus naturally into

•rate trusts leads

third category—the

our

•

improveearnings. In this

•ment of our net

•field

persevere to learn how
only the necessary — and
; that in the most efficient way —

•to

and

how

fee

obtain

and

set

companies?

ance

Hardly.

that the banks' fees would be only
57% of the average investment
expenses incurred by the lowest
six of 12 leading insurance companics writing group annuities;

.cussion at American Bankers

and

sociation's

panels.

As-

and-- 1957.J trust

1956

His remarks,

timeless

are

ductive 'dynamic

Based

the benefit of

1956 figures, comparisons show
that for a $5 million fund the
banks' charges based on the fees
quoted would be only 40% of the
average investment management
charges of the lowest three from
six
of
the
top-ranking,
best
known mutual investment funds;
on

:rules that adequately compensate
.us lor our work-and responsibilities. For suggestions in improv:ing our operations, we can review
iwith profit Bill Lackman's dis-

70%

about

;For the
it

other side of

the coin,

timely that we review our
fee .practices, At. the J1956 panel
this question was askedi v'What is
the

basis

fee

profit

for- pension
and
trusts in Boston,

sharing

New

York,

area?"

The

York

and*, the

"in New

was:

answer

representative* fees
in the

somewhere

run

Chicago

hood

-.%

■

would

neighbor-

the

first $1

million, V* of 1% on the
next $4 million, 1/15 of 1% om
•the next $20 million, and 1/20 or
■1/25 of 1% above $25 million.

Generally speaking/ the rates in
and Chicago and some of
the other sections of the country
are a little higher than these."
Boston

rates

reasonable
to
observation
that

Chicago,
and
little
higher,
especially if the business to which
the rates are to be applied is a
subject of national competition,
Boston,

elsewhere

are

fact

that New York

rates

controlling in national business and, as a natural result, are
strongly influential in that busi-

are

which

ness

ture.

local

However,

na-

strue-

rate

our

practices across the
country are of such pattern that
we may all be said
to be in the
boat.

same

the

occupy

the

Although
upper

some

may

decks, and

some

that

lower, all are subject to the
winds of operational costs
the same waves of competi-

same

and

tion.

From this

Survey

serve

funding

come

Although there is

collected.

direct correlation between the

fee rates

just quoted and the surresults, presumably the re-

vey

Now,

our

classify

can

schedules?

activities,
closely as

them,
state our

cost-analyze

possible,

terms of the duties and responsi-

produced from such pattern
of fees. Hardly the evidence of a
happy condition, is it? Nor is the
condition measurably better if, because of internal accounting treat-

bilities

was

ment of tax credits and allowance

]ate

rates to

our

The fact remains that under such

schedules

fee pattern

hard work was done

for less than its cost.

Because the

figures stated are an average of
the five banks, the chances are
that some did better and some did

same

mlif

to compare om
basis.

And

the

here \ve stand

L,r

nnnivLc
y

trust
pay
no

have

for services used—no more,
arrangement for

customer and

can

secon(^
of

the

improve our earnings.
need, first, the will;

approach in the dignity
premise that the laborer

ates, who can be and frequently
are our best champions; and, fi-

formance, it then becomes fair to
eonsider whether our fee schedules should be
we

adjusted. However,
think of adjustments,

factor of

examined.

competition should
What is that com-

petition which has kept us on a
basis that produces net losses

fee

barest

profits for
that

our

services?

invests and

Who

ages

pension and

funds

bank alike,

economically

operations

our

will

icss—a fajr

banks

is consistent with quality per-

customer

support of our managements and
our
commercial banking associ-

the

event, if we assume that
done all possible to carry

before

that

is worthy of his hire; third, unity
purpose within our respective

cost allocations.
In any

services

basic

of our co. t

curacy

supplementary services.11 Fee
so devised can,
in effect, meter the activities of a

To do
were

terms

profit

man-

sharing

at prices lower than

ours?

Poes this competition come from
Digitized''.mutual
for FRASER
investment funds, from inhttp://fraser.stlouisfed.org/
vestment counselors, from insurFederal Reserve Bank of St. Louis

under which

have

group

perma-

•

deposited

Various

classes

assets.

Costs

nally, the courage of our convicthat this business of em-

ployees trusts is worth the effort
to make it truly profitable,
Im-

provement is, in fact, the qtticl
quo to meeting the demands

pro

trusteeship. Pension and

profit sharing trusts are set up in

form to endure in perpetuity. In
these trusteeships we are stewards of the long future for countless, successive numbers of our
fellow citizens. Sums of all sizes
are committed to our care and
marshaled through us into pro¬

vary

handling -bonds and ;stockSfv mortgsf

and

with"" all

future

contributions

tion

annuity policy usually has

proportionately. And here aquesbe posed: "In the upper brackets

can

cash

a vef.y large trust* at what rate
really -economically possible t^-

is it

carried

Senate

constructive

its

the

onset

burdensome

qii„„«
crease

the

formed

base

the

over

for

form

because

individuals

their

involving

detailed

•»-

proval of -investments? issuance^ of •audft'form annual reports; direct henefif disBursements involving, maintenance ©f
roster* .and, 'preparation,. issuance, ana
payment of checks along Withrthe myriad
other duties "that .are ^mttural^to-^ this ac-

pre" t*V*ty; accounting for shares of IndividS5S3 medium Jiad ual members of-profit ^simring trusts and
nKt-.;.
th.L. j^.iIlIu • f««uance»ofe annual individual'statements;

common

stocks

iSffiTC

Equ,ty Fund"

*cq"'r<: un"s

a»d»

^9 a

possible

new

hori^

^luly tin the

the «SeIosure of' information
10 Management charges of the six mu-preparation ■ of "statistical^ data and
tual investment funds averaged approxi- statements for use in > compliance with
mately one-half of one t percent of the reg4ilations of state or Federal authoriprincipal value—$4.82 per $1,000.
The ties.
..." trusts

comparable figure for' the lowest three '
of the funds was $3.73 per $1,000. In\\r
t •
fif
•
vestment
expenses
of the -12
leading
WftSningtOIF FlStnnillg
insurance companies writing group ang*,
£171
p
"j
nuities averaged $3.70 per $1,000. The
V^Orp«* Ol" a 10T1CI& 1* OrtTlCCl
median for all 12 companies was $3.30
op'xrQAr'nT A
CTo
Wocbind
per
$1,000. The average of the lowest
«!
' >7
>WaoIllilgsix was $2.60 per $1,000.
The - figures ton
. Planning
Corporation * Ol
for the mutual funds and insurance com- Florida has been formed with Ofpanies are constant as they are the same "rn
Qri/q|
rWi«-ft-«r "Plono
for the last $1,000 invested as for the
1 Own ana l^OUIHry riace.
.

first. Typical investment counsel charges ..'Officers are Matthias B. 'Gardner,
per $1,000, including
fees paid through .president; - Willard >R.
Woifinthe counselor for custody of securities,
Vino
TVov
V
and fees developed-by the quoted sched°
V
o
*
rr»
*
ule for banks were respectively as fol- "OSt,
Jr.,
oGCretary-IrGaSUrGrj
lows: $10 million fund, $1.83 and $1.08; . Robert H. Gorman, Assistant Vice$5 million fund, $2.16 and $1.50; and pmci/lont' on/l William IT TTamil$2 million fund, $3.16 and $1.87.
ton
-TreaS'
mn
general,
basic
services
would LOU'
ot-t-icwiy
xit.cUs
seem
to
be those which involve invest- UrGr.

^fsistant Seci^rV

———_____

—

——.—-—

.,; ,i

—

•

individual

its

and

use

their

sumlblv

taxes
making it difficult, if not
impossible, for individuals to set aside
adequate
retirement
savings
on
their
own.
Postwar, the Inland Steel decision
established
the
principle that pensions
are
compensation and, therefore, proper
subjects for collective bargaining.
This
decision
solidified
labor's
position
and

fluence

least

SdJffiS' mIw ■&£ftfr

income

has

are

rising

•'
-

another year

in¬

content

retirement

plans.
Three
other
major
developments witnessed in this
decade
were
these:
the great growth
of trust
funds

solid

preferred medium for fund¬
ing pension and profit sharing plans,
including, in the process, the revision of
many plans theretofore otherwise funded;
the

accomplishment

the

use

common

stocks

the

for

in¬

of substantial parts of these
funds; and the introduction of variations
in insurance company contracts designed
to
match
the
inherent
flexibility
and
other advantages of trust funds to such
vestment

extent

the

insurance

*
■ammi

would

structure

permit.
three

2 The

recommendations

•"

most

general "interest WOre these:/<t) That a
plan might "qualify" if the contributions
benefits
provided do not "substan¬
tially" discriminate in favor of the more
highly compensated employees and that,
in
determining
whether
discrimination
exists,
the Commissioner -may consider
benefits
provided outside the plan for
employees excluded from the plan; (2)
That specific provision should, be enacted
defining the status of supplemental un¬
employment benefit
plans and certain
other plans with respect to such matters
as
the deductions by the employer, tax¬
ability of the trust income, and the taxa¬
tion of-distributions to employees;
and
(3) That in qualified employees trusts,
a
prohibited transaction will be deemed
to
occur
only where a loan is made to
an
employer on terms and conditions
more favorable than can be obtained from
disinterested third parties.

NOTEWORTHY EVENTS IN tRIEF:

3 A
25

retirement
to

cents

per

and

one

from

one

cents

per

largest sales 1
in the Company's history—a 17% increase

over

1956.

<*'V"

rose

for the fourth straight year—

24% over 1956. Per share net amounted to $1.87
versus

$1.50

a year ago.

share—15

DIVIDENDS continued at 70 cents a
cents

quarterly plus a 10 cent year-end extra.
the Company paid a 4% stock divi¬

In addition,

dend in December.
SALES PRICES Unit

selling prices of American's

products have not been increased during the past

three years, despite three annual increases in
salaries and wages, and generally higher manu¬

benefit rate increase of
rate of $2.50 monthly
one-quarter

year

EARNINGS

new

of service would cost

year

cent

INCREASED SALES made 1957 the
„

facturing costs.

hour.

Capacity operations are
expected to continue into the foreseeable future.
OUTLOOK FOR 195S

Immediate

4 Little

long-range, could

cost

impact

hut,

be expensive.

the

tions

upon our

people; and in the latter part
Vandenburg committee

own

the

and

Grow-

and

Ncr doubt the

thani othersl

worse

costs.

„

terns

our

ac-

sweeping
realignment
and
of
employee
benefit
plans.
These years also saw a great stimulus
to the
establishment of plans resulting
from these four factors:
excess
profits
taxes
on
corporations;
competition for
the short supply of personnel; limitations
on
compensation
of
employees - under
wage and .salary stabilization regulations;

re-

jng
from
the . necessity
.of
correcting the present sorry fee
structure, a number of banks are
currently reworking their fee pat-

earnings on cash deposits, the
business showed a slight profit.

for

bear,/and try to

de-

regulation

schedules

ported income of the five banks

its

effected

our

held

experiences in profit sharing
and
possibilities
of
incentive
taxation
which focused attention on all phases of
the problems of workers' retirement, with
special emphasis on the solution by way
of profit sharing.
Probably the most far
reaching
development
occurred
in
the
war years
when the Revenue Act of 1942

they

fee

pensions

annuity
a
singular adlaw placed no

-group

through

survey

that premise, what can

about

-out:

of that decade the

business of $1.15 for each $1.00 of

stand

pension coverage for a large part of our
population, and collaterally, to stimulate
private industry to think in
terms
of
providing systematically for the old -age

according to the annual employees trusts stand on its own
the Federal Reserve* feet and support itself, free from
Bank* of New York, live large carriage by any commercial balcommercial
banks
had
average
ances or other banking relationcosts
in
their
employees
trust ships of its sponsors,
lees

"frequently! converted - as . they, .-approach
the trust fiiiid in -some respects, although
ftill subject to^ the insurance companies'
;nve8tment limitations and'expenses not
found in a trust fund plan........

that medium; the year
saw
Social Security legislation beeffective,
to
provide subsistence

1937

In 1956,

survey

quired

this business

facts

vantage in that the -tax
lhnitation upon the employer's -tax
ductions
for
past
service
benefits

use; annual tax
and the distribu¬

pensioners to be made by an entity other
than the trustee.-lir setting the'fees for

pro-

Deposit administration contracts

of this business. How-

era

the

for

three

demust stand and de-

should

for the trust.

to go into, the trnst fund^ The standard

employees.

for the truat;

reports

can

pen-

in making proviold age- security
of their
Since that time, few years
have passed in which it would have been
impossible for a person to discuss the
developments in pension and profit sharing
plans
without
the
opportunity
to
emphasize some new i.etor or , (resh
angle of an older lactor. In the > t93«'.
sion

must obtain
as

many

employers

encourage

fees,

competence

customers

our

liver,

and

banks-administered

its genesis can be related back to
when Congress first included hi oUr
income
tax
laws
specific incentives to

in-

service

of assets-for actuarial

When

"suall.y hf negotiated into the form of real estate fees and leasebacks, and other
deposit
administration,'with-ensuing .ben- varied, types of assets,-■and rates-should
efits
to be paid first from the insurance

1928

Realistic

source

our

source we

sinews

the

serve.

1956

•

;

ever,

The ratio, so dcvcl-

must

value-and-the only-alternative to-reten- the investirtent responsibility and physical
profit sharing trusts* other than tion is to have the policy, changed into care of bonds and stocks? Supplementalown, prior to 1935 or so.
P-erhaps -*• deposit administration contract by .ne- services for -which.'additional charges /he-*
year . approximates "the
beginning "S©tiation with the- msurance company. .cqm« proper,are tbese: consultation with

their

costs and taxes, are

primary

our

integrated.

Retained they

tion of benefit payments or pensions ia
yonsidered
as a fixed income bulk sums, With actual disbusements to
setting the investment

•

called"
uutu.

are
die

and custody of

of the modern-

attain whatever goal we do

come

we
we

are

the trust but9^if notf the policy, can

group

handling employees trusts, may
possibly be
out
of
immediate
reach as a goal. But, when com1)ared with similarly calculated
ratios in other banking and trust
operations, it will help us set a
reasonable objective,

set,

care-

nent P°licy the stated cash value may these basic services distinction needs to
fr
Tay "m*
ava',able \° ,a successor be made in the rates applicable to the
trustee.
If It.* IS, the cash is

arivnaavo

clsy,
'Mny WO
Of
the
vocation

FOOTNOTES

1 Few

oped and applied to our costs for

DaraDhrase
parapnrase

worthy

;

sion

adjustments

Should Be

?sua"y h°

gram

the policies and the

from

are

investment

another

ment: 'management;

vary

for
our
respective
their current dividends. to
shareholders and
set
aside reasonable sums of security

Our Fees

carrv
carry

the Other;-* paid-up

fund

trust

the

through
vocation is to

Our

years.
To
lO

to
lO

new

pay

fund,

fee

tures and

down

the benefits

prac-

•

pay

and growth.

Strom?
Sironto

necessary

be
ue

mav
nuiy

wherewith
wituewiui

made without adversely
affecting the relative competitive
positions, or jeopardizing the trust
fund method of pension funding,
Thus the problem rests on the
doorsteps of the oanks and all of
us Aare fuped with it.
Assuming that we know our
costs accurately and that, for the
moment, we can disregard all
competition except that ol and
amoiig ourselves, what shall dcternjme the rates of our charges?
As a. star in the sky to set the
course of our thinking of earnings
ratios, we might consider what
banks

our

stewardship

walk

cad be

earnings, over

Perhaps
it
question
the

we
we

C&tG

the^ trust fund.

p?llAc,icsA areA retained, either as a part ^assets l-acceuirtiilff for «ca»h and securi*1 if ?•» fund or^ apart from It, and ties by periodic statements; annual lists

our

need adequate

our

serve
serve.

ther; it shows that, the banks
typical fee pattern is so low that

upward

sound

that
Uictl

the

For

economy.

eu LU "V Wlbc in oul

and

tives, and

eharges made by investmentcounselors.io
This comparison shows

substantial

policies

;in his "stress oh "doinsr only the that the true competition banks
necessary
things^-- and vi those as encounter is engendered by and
simply as possible:
:? amt>n^ the banks themselves. Fur1

investments

our

all this we need to be wise in

typical

the

(1171)

Presently

service, with
retirement
6 Current

that

payable

less

only

stated level.
fifty-eight demands could con¬
permanent five cent rate.

trust

Ninteeen
vert

five cent rate is

temporary
until

age
40 and
10 years of
benefits payable at normal

age.

funds -reach

concludes in his 1957
Graduate School thesis: "Essentially, the
variable
annuity is a manifestation of
the growing acceptance of common stocks
for conservative investment purposes.
A
trustman, believing that preservation of
purchasing power is the goal of conserva¬
tive investment, finds it difficult to take
other than a constructive
view of the
variable annuity."
7 John

Fralick

Naturally,
takes defends
8

ance

contract

methods are used.
In the simpler method the policies are
surrendered and the proceeds taken into

of the 1957

obtained

by writing the Company,
at Lansdale, Pennsylvania.

"America's Oldest Name in Tile"
SfM

AMERICAN ENCAUSTIC

the
form
a
conversion
on the type of the insur¬
involved.
In the case of

individual policies, two

copy

annual report may he

TILING COMPANY. INC.
.>

Lonsdale, Pennsylvania

~/V,

(1172)

vast

Continued from first page

As We See It

the

causes

from which

they spring or the courses of

;

action

be depended upon to remedy the situation.
exposure—if it can be attained—and vigorous
legislative or administrative action might well have an
appreciable temporary effect upon a situation of this sort,
reducing the extent and possibly the seriousness of
offenses for a time. Real and permanent relief must, how¬
ever, be sought elsewhere, and if it is not sought else¬
where and the proper courses of action taken, we can
count upon a permanent continuation of the troublesome
and costly state of affairs about which we now hear in
guarded terms from those who know what is going on. It
is always futile to ask for better bread than can be made
of wheat.
7.7:
J
'7,7:
7/7
7.7//' .'777:7
The Real Trouble ;
can
Relentless

;

which

are

now

Continued

what

flow

page

not

through

us.

- and
high efficiency rat¬
ings in circuits.. *
"v
: -7

achieve

fier business than in the transistor

business.,/Outside

rectifiers

solid-state
wide

obvious

of the

electronic /equipment
?

uses,

have

new

gained

particularly in
industry, but have
been slower in-breaking into an-:
other
area
where
they / should
acceptance,

the, chemical

men, man

very

7 Semiconductor products actually
got to market earlier in the recti¬

eventually have great importance:

transportation. A major probleip.
electric ..transportation ■ is the

balance > between the ef¬
of DC ;power .transmis¬
sion and the? advantages of DC
motors for high starting torque.
ficiency

;

•

Semiconductor rectifiers offer the

in the

expensive

the

about

making

worth ;

;

rectifiers

germanium

commuting train in England. The
reports to date, are encouraging. 7V

$37 H

■7

One

New

Development

look forward to devel-

triodes

this

specialized multi-element tubes of

vacuum

Several

things/ had

happened

possible. Hermetic; sealing of
transistors,
first
introduced
by
General Electric in 1953, became

tube. True,

standard

the

much at the
end'of the month to pay that part

had;

of your

devices

increasing

the

life

the

lead

the

est

diodes

developed into
so

the

and

many

will the relatively sim¬
that we now know,
complex

prising

transistor

tube

vacuum

in the future.

the

•

rectifier

ple

structures/

Of particular inter¬
a device com¬
than two rectifying
a device, called a

today is

junctions. Such

Hermetic sealing

realized.

now

the

today,

industry. This
tremendously

reliability

that

theoretical
is

the

effect

can

opments in another direction: just

rectifier

controlled

transistors,; keeps the
vital,
a
kilowatt hour, but if you want super-pure germanium and silicon
this same power from flashlight from becoming contaminated and
cells, it will cost you $10 a kilo-, thus unable to "transist," which
watt hour just so you can carry would cause instability and finally

year,

have their
During the

between 1953 and 1956 to make all

a vacuum

electric bill used in heat¬
ing the filaments of the tubes in
your
radios and television sets.
This power costs roughly a penny 1

■

past

too.

have been in service in an electric

13-million

some

million.

it does not cost very

eat

tube has been
eliminated. Perhaps you wonder
why so much emphasis is put on
the power required
to heat the
in

space

filaments of

and

transistors

into

process

people

cake

where they can
be
controlled
easily.
Thus
the
most troublesome and expensive
trons

should do for ourselves. But in this country

transportation

industry tripled our output

again

elec¬

of getting the

requirement

electrical

of letting/1 the

promise

figure which is expected to reach
80%; in 1958. That year, 1956, we

but
itself,

space,

solid

the

eliminating

hence

coming to light and much more of which

politicians when they are in office. The result is
and always will be little short of disastrous.
7 What these disclosures in Washington should do for
the country is to start the rank and file to thinking about*
"""the extreme vulnerability of the nation to weak, not to
hsay evil, personnel in government, a vulnerability insep¬
arable from massive bureaucracy. When one surveys the
situation as it exists today, and makes comparison with
what we had known prior to the rise of the New Deal,
the change is all but incredible evert to seasoned observers.
Of course,; bureaucracy had its beginnings long before
Franklin Roosevelt went to Washington. The Interstate
Commerce Commission dates from a point in time almost
half a century before the election of Roosevelt. The Fed¬
eral Trade Commission goes back to the days of Woodrow

controlled

permits, not to say requires, that much of this
massive bureaucracy be manned by political figures who.
act

from

custom

•

virtually/unlimited1:,life

Industiy's Outlook
And Electronic Industiy's Future

if we had through
the decades developed a professional public service as had
some of the European countries before the
eruptions of
the past few decades, we should still suffer the inevitable
consequences of asking governmental officials to do for

government. Only that can save

transistorsf semieon-*
are
small,; have;

rectifiers

proper

lie but slightly below the surface. Even

„

and doubtless sometimes evil

ductor

agencies the situation is by so much the worse. We
should lose no time in getting back to true Americanism

leaving to. natural forces, just so long shall we suffer
from the inevitable infirmities of the system, some of

respects at least essen¬

these

retain the massive. bureaucracy we
now have built up in Washington and so long as we com¬
mit to its tender mercies so much of what we should be
long

iters;

tially the most un-American of all the organs of the New
The harm this agency has already done would be
difficult to estimate. What it may do in the future should
be the concern of every thinking citizen of this country.!

times weak men,

rectF

oxide and other types of dry

of life

powers

Space does not permit further listing of individual
agencies which together now! constitute this massive
bureaucracy, the burden of which we now carry on our
backs. Horribly burdensome it would be in the best of
events. If, as is now becoming evident, small men, some¬

which

;
!

holds greater
some

Deal.

foreign countries where public service was (or is)
profession.
But let us not mistake the nature of these infirmities,

some
.

segments of business, or
death in its hands. It is in

electrode
been

rectifier

—

developed

three

has

the

recently
General

Electric rectifier

engineering lab¬
oratories at Clyde, N. Y. Basically,
what our engineers have done is
portable power in your pocket. It j failure. At the same time our re-.. to build some prototype samples
was this reason
that spurred the » search laboratories were succeed- ) of a semiconductor device, using
use of transistors first in hearing \ ing
in
telling us' more 7 of "the/, silicon.) which will perform the
aids where all of the power must things we needed: to know about/ same function as the gas>thyrabe carried in your vest pocket. the critical semiconductor mate-! tron.
Scientists-Vat - practically
That
power
costs
ten-thousand rials themselves, and the things: every research l abo r a t o r y
.times as much as the power from that
affecti; them.
In : addition, throughout the country have said
this was possible for several years,
your wall receptacle.
; *
Vv several new processes for produc¬
ing the devices, were ! invented and several devices approaching,
V
Evolutionary Period
allowing us to reproduce better/ a controlled rectifier have been These
led

the

were

scientific

the

things

the

which

world-, to

feel

•'

same

characteristics in groups
: r*77

made. What

of transistors."

).r The

' some

devices

have done is build
a

b 1 e7 to

handle

dis-S enough controlled power to satisfy
covered by Bell Labs involved the
in the offing. Actually we havemany military and industrial ap¬
Wilson. So also the Tariff Commission.
had
and
are
going through an growing of a pair of junctions in plications;/
\ 7 77
Vi' '
We
a
really surrendered /ourselves to bureaucracy,
carefully controlled single crys ¬ ; As fart as I
evolutionary period instead. The,
know,* this is - the
tal—then
cutting them up into In¬ first
though, under the persuasive leadership of President first transistors produced fell far.
time it has been done sue-*
Franklin Roosevelt in the 'Thirties. One of the first of the > short of their theoretical capabili-/ dividual transistors, a hundred or cessfully. Although the develop¬
so
to
a
crystal.
General
Electric
ties. We had much to learn aboutment
is
still
in the
laboratory
agencies created by the New Deal was this same Federal 1" how
and why. We learned fast developed the "rate growing"
stage/ our engineers are moving
Communications Commission, which was given the task
process
.whereby
a
number
of
bafnevertheless, for by 1953, only;
quite fast on it and expect to have
of supervising, controlling, and in some measure direct¬
five years after the device was i-iers are grown in a crystal yield samples .available for equipment
several
thousand' transistor
first" announced, the first glim- ing
there

was an

electronic revolution

first ', basic

process

ing the communication systems of the country, including
the telephone, telegraph, radio and television industries.

of- transistor

mcrings

mass

pro-'

A great deal of rather detailed control, licensing and the
/like is now in its hands. More possibly than in any of the
other agencies the
situatiqji here is made to order for the
,sort of thing that has recently been revealed. Some mem¬
bers of the Commission; have been reported as insisting
that the trpuble fs ngtMuth them but with the system—
and in one Very"iyrtpoS&nt sense they are unquestionably

were

seen.

designers in the next few months.

elements.

.7"/ Quantity production probably will

process,'

that, year 7 The alloy junction
the infant semiconductor industry, where the junctions are
duction

get underway next fall sometime.
f'ormedSome may never have heard of a
alloyed
on
each / individual gas thyratron or what it can do
! worth approximately $3 million.-. transistor, was also developed in and therefore have little notion
The only production use of these the. General Electric laboratories.
of what a
semiconductor thyra¬
This process,, more
: transistors were for hearing aids,
adaptable, to. tron or controlled rectifier means.
v Sales .: of
diodes and rectifiers,; mechanization,:, has been respon ¬ A simple 2-electrode rectifier
which have practically all of the! sible for over 75% of the transis¬
changes alternating current to di¬
tors produced to date.
same features of transistors, added
- •
7.
/. rect current.
Basically, with one
The diffusion process developed,
to that of transistors, brought the
correct.
.'
:
"
rectifier, you can get one-half of
total
semiconductor
industry's. at Bell Labs is just beginning to* the
alternating current put into
The Federal Power Commission dates back to 1920,
sales in 1953 to $10 million. The have commercial application' and
the circuit, out in the form of
but its scope was enormously enlarged and its potential¬
years 1954 and 1955 were char¬
although difficult to control can direct current. But
you
cannot
acterized by two major features, produce higher power and higher
ities for injury to important lines of business tremendously
practically vary the amount of
wide scale sampling of transistors frequency than the other known
broadened by the New Deal. The Federal Waterpower Act,
direct current coming out. This is
to engineering design groups and processes.
set once and for all by the circuit
the
Tennessee Valley Authority Act,
the Bonneville
heavy research and development
There are also combinations of
design.
efforts by semiconductor manu¬ these
Project Act, the Fort Peck Project Act, and the Natural
processes such as grown dif¬
There
are
several
expensive
facturers to improve the product
Gas Act, each broadened the responsibility and.enlarged
fused
or
alloy-diffused " which, mechanical means for
varying the
and their ability to produce it,
have* advantages in performance'
the power of the Commission. "As yet so far as known,
amount >■ of
work
done
by this
Although the number of tran¬ and cost for some market require¬
none of the members of this
direct current output, among them
body is under fire particu¬
sistors sold in 1954 tripled those
ments.
"
"
are gear systems, step down trans¬
sold the year before and tripled
larly in current Congressional inquiries. They may have
/ While the use of transistors was
formers, rotating amplifiers, and
lived impeccable official lives. But they are human, and
again in -1955, it was not until
growing rapidly, sales of their voltage varying devices. Gas
1956
that.- a
marketing
break¬
only a devout exponent of managed economy would or
sister mass-produced
devices, thyratrons can do the job elec¬
through of significant proportions
could believe that it is necessary or advisable to place any
diodes ,and
rectifiers, were also tronically and eliminate the com¬
occurred.*'For in
1954 and
1955
ar.d
expensive
other
the market was mostly character¬ growing rapidly, and for the same plicated
group of men in the positions these individuals hold.
reasons. Sales of these components
/
;
'
i
methods, but thyratrons are too
ized by increasingly widespread
grew
from
$7
million
in
1953
tobig and too temperature limited
interest
in
The Worst of the Lot
trying out the new
for many applications. Also, they
. *
devices in circuits. No significant rpughly $40 million in 1956.
Of course, the Securities and Exchange Commission
Mainly, semiconductor rectifiers have the same life limitations as
use of transistors occurred in mass
other
electron
is a creation of the New Deal which time and again has
tubes.
The
con¬
produced equipment. However in have been used to replace other1956
transistor
broadened its duties and its powers to include not only
portable
radios means for changing AC current to trolled rectifier or semiconductor
made their first mass appearance DC current; Along with the tran¬ thyratron on the other hand is
the securities business as such but

produced about 600,000 transistors

017

•

public utility holding
companies and related matters and investment companies
and advisers. It is doubtful if there is any agency in Wash¬
ington which has under its wing such varied and such

and

met

with

almost

instant

de¬

mand. In 1957 transistor
started

and

with

are

30%

now

portables
the market

obtaining

60%,

sistor

they

are

for

competing

part of the electron tube function.
But

addition

they

are

competing with selenium,

also

copper

small

—

about

equivalent

gas

1/100

the

size of

thyratons and like

other

semiconductors

tually

unlimited

has

life.

vir¬

Where

Volume 187

Number 5724

thyratrons
ited

and

first will be in

;ancl

biggest luse

the

controlled

new

.of

rectifiers

such equipment, is

more?; rapid

radio.

machinery;^Theyi .equipment.built

half

and

millionth

can-be

amount of

used

a-second, function pf

/to/

vary

needed

World

2-way
War

electronic

semi-

visualize

can

electronics

such

which

systems. So

that until the

see

were

the industry was limited
by the components themselves to
the
various
markets
it
could
proved,

;

the anization and automation is
con--control.-Ineluded in control—

The

demand

The advantages of electron

serve.

tubes

customers

experience. Heavy competition is
in daveloping in the industry beprice is enormous, cause mass markets are opening
.And naturally so, because they up. The key to the future for each
can; see the present markets for individual company will be the
their equipment expanding,
the ability of its management to chart
potential markets opening up and "the
right course for itself,
ft
the rich rewards ahead.
seems elemental that the prices of

basic electronic components for. ever,
invented
or
further
im- volume at

better

our

components

low

spurred equipment manufacturers entry into some markets
For those semiconductor organ!;trot.-..the intensity of lights in a control of a manufacturing opera- while the electron tubes'- limita'Zations'""-wh-ich'*Can- meet thedetheatre.,; Thyratrons or magnetrc tion, control:-of inventory or ,of -tions kept them out of others.
mand and SUPPiv the quantities
;amplifiers now do. a large number, distribution —are three functions Now we have the family of semipower

trol the speed of motors or to con-

whether -Of

chemical

process,

'fiers

we;

have

^switeh and control

far.

seen

affairs,

load, of 200

(2)

processing the information .son obtained with such aids

can

rvolts: and

5 ;amperes ..or- 1:5 c kilof-, .as ^computers
a n d
watts of .poWer with only 15 milliW stored 'in
memory :

'watts injection at the control lead.
This is

addition

ex-^

;

pect that the controlled rectifiers
fwill

the

used

being developed
creasing pace. \i'

tlie

military' in
transistors, in- > i;^

in-

ever

-.'"I

place of

'guided

some power

s s

i l

rfOr

e s

example,

ment money, are freeing the electronic equipment industry from
many
of the market restraints

-.-Avr-„

he reward<? fnr themselves
as

•

Ubviously no one single organiz?
can
a,
.e SjPP. er
ot
e myriad
semiconductors
required m tne various markets.
we at general Liectric are not,

\But the overall rtmge of'serriiconductor prices will probably be
quite broad because. we will be,
use: ineverything from toys to missiles.
Thus .an
average
price
(which

'selling semiconductors for

electron tubes.

bolts" problems which lias been the same thing because they must
holding the semiconductor indus- be to achieve the expected growth.
used in equipment made possible fry back from an even faster ex- The
era
of
uniqueness of our
only by their invention and sub- pansion than its meteoric rise has products is pretty much gone.°
sequent development.
been a lack of standardization. A Today we 'are -more and more

-next

better

decade

the

transistors

than

50%

produced

will

milestone in the transistor busi-

Problems Facing the Industry

•

ness was

achieved this

year,

selling

the

when. rather- than

agept

practically the entire industry. engineer. Performance is virtually
- fruition of these components adopted
a standard signal trail- taken for granted. Price and prdwhich can set the electronic in- sistor housing having a standard duction are more the determining
the
silicon
controlled : rectifier, better than the individual "build- dustry
free from
previous re- base lead arrangement and over- factors. These are also key man,would, of course, include auto-: ing blocks" of which it is com- straints, there are a number of all dimensions. This housing meets agement decision areas for each
matic
machinery
or
popularly posed, Limitations of the compo- hurdles.
tbe requirements of a broad seg- company in the business.
"automation controls," where the nent are. directly transferred as
Because the electronic compo-ment of the electronic equipment
Today there are about 4# manuspeed of motors is controlled by--limitations; of ■ the equipment it- \ nent manufacturer delivers more industry by allowing the e<N*ip- facturers
in
the
semiconductor
computers, punch cards or magr self. Fon example, the reliability than hardware to the door of his ment manufacturer to standardize |jeid. Few if
any new faces are
netic
tape. This
motor
control, of, a particular piece of electronic - customer, he has grave responsi-other parts he needs to build
seen .Already, we have: seen
must
be accurate,. fast and
de- -gear; is directly determined by the bilities.other than building a good
ms^q^i^ment.
' some- withdrawals on the part pf
However,

purchasing

the electronic design.

goes

cents each in the next 19 years,

well

all of industry

eqme

Some types of transistors may
be selling in the vicinity of 35

up.

figures t0 slightly over $1) in
°ut We believe we are eioser tnan
meaniiigless.
Semianyone else.
conductor prices will be competiWe fully expect that within the
One of the major "nuts and tive with other methods of doing

imposed by

^U1*"1118 "lock
The -manufacturer of an elec; where power transistors are being .tronic component performs a
-used as switches to>-convert low
unique function. His product is
:
voltage direct current from a bat- not. only- "the
building
block"
tery to either high voltage alter- from, which electronic equipment
nating or direct current.
is made, but also controls what
V ,.ultimate-practical use can be made
/Other Possible/Uses
of that equipment.1 The
resulting
;■
- Other potential applications for
piece . of- equipment can be no
-

jobs electron tubes
will do, but do them better. More

:tp;; control; For all-of these control
previous: :.tasks,,: semiconductor devices are

the

applications I mentioned,

the

instructions; importantly, .- however,
semicon- ;
devices and ductor components which are the
execution of the-fruits of research and develop-

control ratjb of 100,000

one.

finally: (3).

lot

* a

semiconductor products will

'down steadily as.production

required when required there will

jof these jobs. The controlled recti-'1—(h> sensing the actual state of .conductor products which will

...

auto-

matic pilots and remote guidance

mech-

controls

manufacturing line to mechanize, from
1950 to 1960.
Real
mass
potential
products
to production,
mechanization,
(or
develop
when
practically
no automation) and broad customer
methods
are
available for re- acceptance may be expected from
searching the potential market, 1960 on.
"
and
which
new
manufacturing
[The next three to five years will
processes should be developed can
undoubtedly be the most crucial
be disastrous.
'
and
difficult in
the
industry's

With

undoubtedly will find wide use in • semblies-which can be changed as
'replaeing "latching-type" r.relays. ^easily r as light bulbs, in case of
in circuits
for switching power;: failu^,-;:,rr•They will turn on and off. in one^:. r As pointed out earlier, the key
'and

and had

came

deterrent to

of plug-in as-

cars

Then

with even; greater research and
development efforts on improving
electronic
components,
and
we
had
radar,
TV sets,, and even

growth.

mUitary equipment, conductors

industrial

confidence

(1173)

•i

equipments incorporating^ put them in

use

these ■deviees-twith

higher

even

;.»•

^Probably
these

ean

at <150°C Irrteehanization for the factory and
than office." At present the personnel
and/ cost
required
to
maintain

perform

;

■

The Commercial and Financial Chronicle

onr

will

possibly

that/

temperature limnew controlled

are

90°C;

rectifier

before

the

see

;

pendable.
.

In commercial

used

....

man"

"rprc

r9n5K nv<!

nr<a

controlled

con

rectifiers

to/control

and-, the lowest reliability factor of any. the future/There are two princi- secona source _ior several "a*1- There undoubtedly will be more
the-mass ; of : components used.-pal areas for this continuing inr types is becoming avaiiaDie.. companies either- getting out of
quality and.-You can get worse by poor equip- vestment. These are basic research
.AdJs ,a.g?m1- lsu?sse •
fr
.
the business as the result of poor
uniformity of the weld. Eventu-, ment design but no better by good and development of new products
_s neaitny
guesses or becoming
ally they may be used extensively; design.
an(*
a
continuing
program
of
°i our cusjog^rs, Tne-equip-^~jow voiume> specialty concerns,
in
the./ home/jtn /kitchen food
For example, in one-shot de-: mechanizing the factory to deliver
..inanuiaciurers,
fr®- This was - and is the course the
mixers, e l e c t r i c.i stoves, . honterfvices,:such as a guided missile, the^the increasing volume required,
tnemseives
to
one
component ^ube business took. In 10 yeafs

the/amount

rise ancl fall of currenLflow-which: .of
in

the

controls

turn

weather

conditioning equipment: reliability of .-electronic compolighting controls. This pew „nents - is highly stressed. If an
gives us the capability of electronic?component in a missile
extending the use oh simplifying,--fails after the missile has left the
long-life electronie: :circuitry - in ground, there is no chance of remany
new
mass
markets/that/placing-.the defective component.
were
previously, closed/because In addition, the failure of a single
large, power consuming, short-life electronic component could mean
electronic components .cere
the: that the.-missile
would go oftonly ones available, v -r
course or become
o t h e r w 1 s e
-

and

device

•

The Function of

Component
from

Aside

useless.
Electronic.
The
/

the h

e n

relation

what

industry needs for itself in addition to what it will sell to others.,
It is not
a

the

economics

used

components
ment

tomorrow's population

trends and

production requirements describe
not

lower

better

compo-

prices

selling

tbe

tomorrow.
ThP spmipnn^nptnr inHu«trv will

nnf™y"™^ nriXL
becomes

our

comoetitive

^ other^ older method^ot doing
the ,same; thine
in

lAmc

sourcethere may welt be only a few
But the Primary and continuing full-line or nearly full line supProblem confronting the industry pliers and a dozen or so specialty
today is putting enough money in manufacturers. For the volume we

nnr

There
v

LjLSnI

prob-

are

Hoins*

thic

research

development

and

see

for the industry—on the order

for the products and of 500 to 600 million units a year
methods of tomorrow. The mdus- „ Detroit-type production lines
fry must recognize that invest- are necessary for the large manuneeded

fectur?rs-

^"ding up to that size

Pro?esses 1S a cost ot staymg m annual volume in such a short
business.
period will have its effect on im-

component-

Predictions

mediate profits because in addi-

do more

whom the equip-

manufacturers

determining

the

must

depend

character

their

equipment and thus their
markets, are dependent themselves

problem of. on basic research for
as the only
components they can
problem of the fu- search basically gives
as

contribute

devices, but

/
bines the sciences of
But manufacturers of electronic"
chemistry, electrical

"automation." But those who have

most .careful studies of

both

nents

build-

be used.

can

made, fhe

automation

•.

the cost of today's

manufacturer is considerably difTbe future potential for semi- tion to buying the volume prothan just determine the reliability ferent from all other electronic conductors looks almost unbeliev- ducing machines, heavy investof the equipment itself. They also
component manufacturers First of able> From the 1957 industry total ments in research and developobviously determine such factors. all
unlike the others who pro- semi-conductor
sales figure of ment on the machines will also be
as~size, shape, power needed and duce their products
mainly by $140 million, we expect the indus- necessary/" Not
only will the
through these factors, where and.
shaping raw materials
the pro- try wil1 increase sales seven fold machines have to be new in design
how extensively
the equipment duction of semiconductors com- to
billion annually by 1967. but they will also have to bo new

appropriate here to enter.

discussion

components

e a

try's growing interest ill this field
science

y;.

Manufacturer.ing electronic equipment

prospects for selling semiconduetors themselves, I believe indusof

of these must be included

.Both
in

metallurgy,
engineering
and the newest of sciences, solid
state physics. Secondly, the exotic
things we do to standard materials
are

done

two

three

tolerances

molecules.

Standard

Bor 1958 we expect an industry
increase of 33% from $143 million
1° approximately $200 million.
^ an example of what this
means' thls year we exPect tbe
industry will sell about $70 milllon worth of transistors.^ These

in concept. In addition heavy
expenditures in research and
development will also be necessary for new products just to stay
even wlth tbe board,
This does not mean that semiconductor

business

currently

transistors will be used in only operates at a loss—but much of
little . oyer 12% of all the
potential earnings must consolution to a
us new and
these
same
standard
materials electronic equipment sold which is
ture. Suffice it to say that almost
better
components and tells us pui»er than anything seen before valued at $6.9 billion. Our niarevery
industry will become in- how to make them. The future and we must maintain this level
analysts predict that in 1967 business.
..
;
creasingly dependent on—and in- products, that research shows us of purity throughout our manu- the total value ot new electronic
It looks now as if future uses
the

future

rather

in—automation.

terested

industry's
science

but

interest

Much

solid-state

are possible,
the; whole

the

kind

make.

Re-

destined to keep
electronic
industry

are

to^ the

impor-- alive. Without this basic research,
tance of solid-state devices—like We can shuffle existing composemiconductors—to
A

automation.

nents for

time and

come

with

tolerances

are

1/10,000 of

facturing

measured

inch. We must use

process.

one

our

scientists has put it rather neatly
level of impurities is the

—the
same

the

counterfeit dollar in

one

United

States

Treasury.

r!? wl!
a^nUu of semiconductors are only limited
$12.5 billion. Transistors, wul be ,
the
imagination." There "are
used m better than 80% of it. We
feel that the use of transistors and already many electron c eqyip°tber semiconductors will in large ments being produced which were
part make that expansion of the impractical before and only praeelectronic industry possible.
tical now with semiconductors. No
,

equipment but within the same time we must turn out
automation is control, and the key a short period the possibilities will our
products at the rate of a
requirement for control elements become exhausted and the indus- button
factory.
No
standard
But the growth of our semif
is reliability. Semiconductor detry will start to "dry up."
machines or processing patterns conductor industry in serving the " e o
key function of electronics in

vices

give

promise of

every

viding the ultimate
reliability and low
that

will

tion is to be

instead

pro-

in long life,
maintenance

required if automadependable servant

sick

relative

requir-

ing constant nursing and medication.
Semiconductor devices
are
the

first

ponents

active

which

electronic

not

com-

have

determinable life. That is, they do
not

start

wear

out

soon

they are put in service. Thus

new

some

The

growth pattern

and

shape

0f the electronic industry was and
still
the

basically

characteristics

determined
of the

tube. This invention

electron

by De Forest

marked

the birth

of today's

tronics

business.

Continued

elecim-

provements in the basic active
component in a radio, the tube,
made thern moie acceptable to the
buying public and sales increased,
When radios became small

exist. AIL must be devised.
this takes time and money
great deal of both!

enough,
through further improvements, we

moving

today
furious rate. To-

be obsolete within a year,
Even the technology for designing
can

the equipment is new. The penal-

the wrong deciwhich
parts
of. the

for making

sions

hnf

And overall electronic and electrical the tiend is signmcant. Certainly
a industries will not be easy. We automobiles,
home appliances,

day's mechanized equipment and
processes, which cost hundreds of
thousands of dollars to develop

ties

ohaki-n^

—

Semiconductor technology

s .worm snaKmg put

will be growing and maturing at
rate

three

achieved

acAlie)ed

industry.
growth
theirs.

times
the

The
will

fast

electron

pattern

now

our

probably

does,
.

tube

machinery
factory,
will

both

—

and

office

military

better

for

and

equipment

the

advent

ine e^ctron tune, will be better tor the advent ot
the heavy

vei0pment and reduction to

Alce

that

de-

prac-,
,

semiconductors. It is possible that
the

use

of semiconductors will
the

broaden

electronic

use.

circuits that the electronic equip,

...

making our products is ment industry of the future will
taking place in the decade be unrecognizable

such.

The Commercial and Financial Chronicle

Thursday, March 13, 1958

(1174)

Continued from page

which

why

edge

way,

and
between
tech¬
new
fundamental knowl¬ technology,
'
is first translated into the nology and hardware.
With
this
pressure
and
move¬
materials, components and tech¬
niques with which the engineer ment in the military area, it is
natural
that the quickening of
must work.

Glimpses Ahead lor Electronics

pace

relied upon vacuum terials, I have indicated the base
tubes.
Now, semiconductor de¬ upon which we are building our
new
technology. The building
vices are rapidly taking over for
process
itself has presented us
many applications. Moreover, these
with
a major challenge that has
devices are achieving hitherto un¬
called for a change in our working
known results.

should be felt in the

areas

that they

behave that

or whether they will do so
under other conditions or in other

techniques

it is

materials.

In the
T have

present environment, as
described it, many indus¬

Application of the systems \Concommercial research, engineering trial laboratories feel limited in "
cept thus is enabling us today to
and application. This is true if for devoting much of their resources to reap maximum benefits from new,
no
other reason than the ever- long-range programs of uncom¬
expanding scientific and technical
quickening pace of science and mitted basic research. The process
knowledge. At the same time, it
is one which requires much time
is providing us with broader ex¬ technology in general.and
talent.
Increasingly, it re¬

Thus, in both military and com¬
perience of immense value in
preparation for the coming era of mercial areas, a growing number
automation.
For
surely weare of developments are being brought
moving from the electronic data- to maturity simultaneously. With
processing systems of today to the research 'groups of - independent
automatic factories and offices of organizations
simultaneously ac¬
tive in the same field, the best
tomorrow.
•..
•
results first have become the order
The Ever-Quickening Pace of the day.
The organization of
To the scientist or engineer in which the research group is a part
electronics, the materials evolu¬ must move quickly to practical
tion and the change in our re¬ application in order to retain the
search and engineering methods as competitive advantage of time.
I have indicated them, are char¬
Faster Pace Encounters
acteristics
of a new and
chal¬

quires complex and costly facilitiesf Cost of engineering devel¬
tentially useful phenomena have
opment and design .are , clearly
Systems Engineering—A Growing
been brought within our reach by
understood to be a part of the
Concept'
cost;
the electronically-active materials.
of a product.;- There is a growing"
Our challenge has been the task
In the semiconductors, we influ¬
understanding^that- expenditures
of adapting increasingly complex
ence conductivity by applied volt¬
for basic research are likewise a
devices and techniques to the re¬
age, by radiant energy, and by
proper cost of doing business. This
electron
bombardment.
In new quirements and limitations of the
understanding is not Tas yet uni¬
ferromagnetic materials, we in¬ people who must use them. Our
versal nor is the obligation to do
duce and control magnetism to response has been an increasing
basic research; assumed by many
reliance upon the comprehensive
fashion permanent and nonperindustry: ^
and
*y'•VV'i/
logical concept of systems
manent magnets of high efficiency
and light weight. We obtain many engineering.
Cites Need for Basic Research
Systems engineering is basically
of these same effects with new
>: Let me cite an- example of < a
Limitations
ferroelectric materials. These op¬ a method of going about our busi¬ lenging environment. In this new
erate by the application of volt¬ ness. It involves a determination environment, all who are respon¬
In a sense, then, we are under¬ basic, although not uncommitted,
of
the "objective
research project carried out sev¬
that is to be sible for continued technological
ages rather than by the setting up
going an invigorating experience.
eral years ago at RCA Laborato¬
of magnetic fields. With new elec¬ reached, and a thorough consid¬ progress
find themselves under But we also arc encountering lim¬
eration
of all factors that bear
ries. The objective was improved
troluminescent materials we can
ever-greater pressure to produce itations arising from the accelera¬
understanding of the phenomena
convert currents in the solid di¬ upon the possibility of reaching results. What is the source of this tion of our technical
progress.
I
rectly into visible light.
We that objective, and the relation¬ pressure? What are the problems refer to .the rapid rate at which occurring in the ' oxide; cathode.
From such a study, we expected
achieve by controlled inhomoge- ships among these factors.
that, it creates for us, and how we are
using up available funda¬ to
gain fundamental knowledge of
Admittedly, this is not a new may we find their solution? These mental scientific knowledge with¬
neity within a single piece of
lasting value to electron tube tech¬
material multiple effects that practice. What is new, however, are the questions I shall now con¬ out at the same time the
certainty
nology. This project extended over
previously required complicated is our appreciation of its universal sider.
of replenishing the supply of such
a period
of about five years and
equipment or a combination of value as an effective method for
The half-century that has just knowledge for tomorrow.
In this
involved the concentrated atten¬
solving the difficult problems
single-effect devices.
passed has surely been the pio¬ sense, the tables have been turned tion of a team of talented
physi¬
raised
Each new development in elec¬
by today's complex under¬ neering era for industrial research. from the earlier situations.
cists. The results in increased un¬
tronically active materials carries takings in the technological field. Beginning at the turn of the cen¬
For many years, for example,
derstanding more than justified
We now recognize systems engi¬
its further toward extreme econ¬
tury, the slow growth in number electronics has been stimulated the
effort, but there still remains
As such, and size of industrial organiza¬
omy of power and space, combined neering as a discipline.
through
the
application
of
basic
a great deal that we do not know
with
greater sophistication in it has a set of rules affecting its tions
engaged in research con¬ knowledge obtained through re¬ about the
means of controlling the
functions that can be performed. conduct, it requires people with
tinued up to the start of World search
during the few decades phenomena that were discovered
Thus
an
increase in
functional specialized training, and it calls
War II. The growth pattern took around the turn of the century. By
and
described.
for
substantial
changes in our re¬
complication, such as we have only
a very sharp rise at the outset of
arranging
circuit elements
and
It is this scale of effort that is
dreamed of previously, now is be¬ search and engineering organiza¬
the war, and it has since con¬ tubes in
different combinations, required today in many areas of
coming an economic reality. There tions.
tinued at an ever-quickening pace.
by altering the arrangement of basic research. In order to meet
are
two major results: increased
The systems approach as we now
The
unprecedented demands elements within the tube, and by the demand, however, basic re¬
utilization of present types of elec¬
practice it is broad in scope. It
upon
science
and
technology
in
aggregations into logical systems, search nftust be relieved of the
tronic equipment because of de¬ crosses the boundaries that have
World War II resulted in strong it was possible to achieve new de¬
pressures that I have described.
creased size and complexity, and
separated the various academic
government support of research vices, techniques, and services.
It must be provided with an en¬
new applications for newly con¬
disciplies, that have separated re¬ and
development. GovernmentSuch a procedure can continue vironment in which talented sci¬
ceived apparatus that were never search from
engineering, and ad¬
funds for this purpose flowed into
before economically feasible.
only so long as the new require¬ entists may apply themselves to
vanced development from product
industrial
laboratories,
old and ments do not call for overcoming long-range objectives without
Just as we are achieving dra¬
design and marketing. It is fully
new.
It
flowed
into
universities
fundamental obstacles. Today, feeling compelled to fill prescrip¬
matic advances in electronics with
cooperative, involving people and
and research institutes, and into with the
the development and application functions
ever-quickening pace of tions for hardware in order to
that might
appear
at
the
expansion
of
military
and
gov¬
of new materials, other important first
applied research and engineering qualify for financial support. How
glance to have little to do
ernmental
laboratories.
Inevitably,
areas of our technology are pro¬
development, we are encountering is such an environment to be ex¬
with one another. It is character¬
in panded and what is the situation
gressing
rapidly
along
similar ized. frequently by compromise, there were two principal results— new fundamental problems
a
sharp rise in total activity in areas where we should like to do today?
lines.
requiring sacrifice in some details
research and development, and a
The talents for basic research
things we do not know how to do.
Important new materials have for the sake of achieving a prac¬
been developed primarily to with¬ tical system. It is thorough, calling sharp rise in the number of or¬ One such area pertains to the re¬ are to be found today in universi¬
ganizations engaged in these ac¬ liability of our increasingly com¬ ties, foundation laboratories, gov¬
stand
high temperatures under for examination by the systems
tivities.
stresses well beyond those at engineer of every detail that bears
plex electronic systems. With the ernment laboratories, and indus¬
A broad range

of useful and po¬ methods.

„

;

number of components trial laboratories. In certain areas,
employed, the probability such as the field of electronicallytoday.
Organizations
that
had of failure of the entire system is active solids, industry is, today,
previously engaged in research increased. To overcome this dif¬ the principal source.
The

which earlier conventional mate¬

upon the functioning of the com¬
Applied in plete system.
jet and rocket engines, these new
An integral part of the systems
compounds and alloys are opening approach is the related discipline
a new gra in aviation and missile
of human engineering. In this area,

rials 'fail

completely.

technoli

•

with

deal

the

lished

pattern

thus

was

which

with

are

estab¬ greater
living that

expanded their activities and di¬ ficulty,
we
must
achieve new
rected them toward military end- standards of performance through
uses.
Other organizations previ¬ banic improvement in materials

all-important

Study df lTilcr gffects of nuclear question of human limitations,
upon the properties of finding our solution in techniques ously unconcerned with research
materials is showing us which will place a minimum bur¬ found themselves aggressively en¬
how to alter substances in order to den upon human mind and muscle. gaged in research. New enterprises
increase their utility. As our un¬ A lack of proper human engineer¬ arose whose sole business was re¬
search
under
government
con¬
derstanding of radioactive phe¬ ing can be costly or catastrophic.
tract. Continuing military demand
nomena is broadened through conProper consideration of human
tinuing research, we may expect engineering factors can, however, encouraged growth in all of these
fruitful results in this area from provide the margin between suc¬ areas through the period of the
Korean conflict and on up to the
the treatment of many materials, cess and failure.
radiation

and

various

including

our

electronically-active

solids.
At every turn, we can find evi¬
dence that modern technology is
more

and

revolution

result

the

materials, whether
think in terms of electronics,

of transportation, of construction,
or
a

of weapons

technology.

This is

self-perpetuating revolution, and

one

Any

systems

teamwork

that

continues

ever-

quickening pace. With each new
material, we advance upward to a
new
level of performance in a

present time.

project calls for
individuals of

The impact upon

among

scientific

and

technical community

achieve the over-all objective. A
wide range of talents is thus

brought to bear

it follows that there is

competition

in research.
Ever

each problem.

given field. Having reached this
This working concept has been
new level, we encounter a barrier
designed specifically to fulfill re¬
which must be overcome by the
quirements in the engineering of
development of another, better complex systems. Its effectiveness
material.
can be measured by its successful
This is an area in which our op¬ application in developing our ver¬
portunities are virtually unlimited. satile systems of communications,
Nature has supplied us with about home entertainment, automatic
.90 different atoms, and man has controls, and military weapons. At
fabricated about a dozen more. the same time, certain aspects of
These may in turn be united to the systems approach, notably the
form an almost infinite variety of characteristics of team operation
materials. Furthermore, the com¬ and careful definition of objec¬
positions and properties of these tives, are being applied with equal
materials
may be selected to order success to many of our research

fyr performing specific functions. projects.
This-is especially the
http://fraser.stlouisfed.org/
In this brief discussion of ma¬ ~ise in those areas of research in

Federal Reserve Bank of St. Louis

the industrial

has been profound.
new
in research,
skills. In such a group, there may Organizations
new
organizations,
have
be physicists, chemists, mathema¬ and
learned the value of research as a
ticians, electrical engineers, aeroway of industrial life.
Organiza¬
dynamicists, psychologists, me¬
tions which supported research in
chanical
designers and many
the prewar era no longer hold a
others, functioning under a project
director and having in common unique position. Research has be¬
the ability to cooperate fully to come a competitive necessity, and
varied

are

equipment. Another; such area
operation
of electronic
equipment at far higher tempera¬
the

tures

the

World

have been engaged in
technological race with the So¬

War II, we

those

which

ability to conduct an ade¬

coordinated program

shall

This again is

and a lack of
I

long-term support.
consider several facets

sufficient

they

this situation.

problem mainly of materials, to

Historically, educational institu¬
principal seat
uncommitted
basic research.
Moreover, we know that a large Scientists in these institutions have
measure of
improvement can be broken the barriers, have provided
made in existing electronic serv¬ the new knowledge upon which
ices by the achievement of mate¬ engineering progress has been
rials of better performance.
We based. There is a growing complex¬
need, for example, improved ther¬ ity of research facilities and. en¬
mionic emitters, luminescent phos¬ vironments with attendant higher
phors and magnetic materials to; and higher costs. There is a need
move
from
present satisfactory for larger and larger teams of re¬
performance to what we might search staff members. Under these
call "hi-fi" performance in all of Conditions much scientific explo¬
our electronic systems.
ration has become too costly for
These are all questions of the educational institutions on the ba¬

be solved

through long-range re¬

search.

tions have been the

same

since

than

will function today.
a

The

quate schedule of basic research
lies not in any shortage of talent,
but rather in a, lack of an over-all

type

were

basic to the

long record of study in the physics
of solids. From this came the tran¬

sis of the earlier formulas for sup¬

port.

However, the need to con¬
military

tinue research because of

sistor, the photoconductor and
Union, with the principal ob¬ other electronically-active devices
jective of maintaining scientific and systems. But in today's en¬
supremacy in arms.
Today, with vironment, with its pressure for
the new evidence of Russian prog¬ quick results, we are too often re¬
ress in missile technology, it seems
quired to conduct essential basic
likely that our own efforts may be research in -an applied research
All too frequently, the
further intensified. As I prepared fashion.
this material and even as I present result is limited know-how appli¬
it, movements are under way to cable to a particular case, rather
sharpen our efforts and to provide than the basic knowledge — the
more
effective administration of know-why—needed as a founda¬

requirements, because of graduate
student training, because of facultv desires and because of com¬

programs. With this intensifi¬
cation will certainly come new

tion for further advance. We learn

fundamentally the creators of new

further shorten the

electrons will behave in a certain

viet

our

pressures

time

steps

between

science

and

how to make a material in which

ray.

We do not find but, however,

petitive environments, has drawn
university research strongly into

military applied research and de¬
velopment. Financial support is
more readily available and more
certain to continue for applied re¬
search and development than for
uncommitted basic research. Edu¬
cational institutions are no longer

knowledge, they are also thejus^ra
new knowledge. Therefore,-they

too, add to the process

of depletion

Volume 187

Number 5724

...

The Commercial and Financial Chronicle

.(1175)
of basic

knowledge. The volume of
scientific research in; educational

-institutions is
of

the

longer

effort

a measure

advance

basic

knowledge. The well-being of the
research

communities

educa-

tional institutions is today, too se-

curely hitched to the "fortunes" of

defense programs. We should train
We
must
clearly
understand
scientists and engineers and what it is that needs to be
done,
train them better so they may per- We must
plan so as to assure that

form

more effectively. We should
provide appropriate facilities and

the objectives

met.

are

We must

organize to coordinate the efforts

Left

invigorating environments. We of all of the units—for all must
should
assure
stability so that contribute. This will require the
long-term research

may

mature,

best of talent and

the
:''s

purpose

Federal

which

veloped with respect to

time that

critically re-examine our doorstep. Upon what we do
procedures and policies here, more than upon any other
relating to science and military material thing, will depend the
requirements.
outcome in the world of tomorrow.
all of

-television

our

a program

—

Communications

interest.

there is

Upturn in New Orders Detected

store of

areas

they conduct

balanced that

amount of basic research.
a

welcome

addition

needed addition to

This is

and

much

executives

confirm have noted a spurt in their
right now is not ernment business,
report of NaCommoditv Vrice*

business

good.

The

tional

Association

Purchasing

....

conducted six days of hearings on the
subject.
Committee adopted a Resolution

not

troit Edison Co., Detroit, Mich.,
members reported that, overenough, today, to feed our ever- points out: "Production schedules ?.U' th<ry ar®
payi££ less.for the
quickening programs. For the few are still being cut.
Employment sterns they buy. They point out
industrial laboratories conducting js
drastically down, with more r1
*
pri?e weakness which has
uncommitted basic research, one members
reporting reductions been Pre,va}e!lt in many of the
might say that there is a balance than at
any time since 1949. The rSw
mate*ial markets is now
between basic and applied effort,
campaign to cut inventories con- showi?g, signs
of spreading to
taken

tinues.

Price

together, there is imbalance, material

for only a few carry their propor-tionate shares. V

weaknesses

markets

raw

show

signs of
spreading to manufactured commodities. Competition and sales

"RESOLVED, That it is the sense of this Committee that
public interest would not be served by the granting of
authorizations for subscription television operations as con¬
templated by the Federal Communications Commission in its
First Report, adopted Oct. 17,
1957, in Docket Number

faction methods that

11279,

because

*■'

stitutions would not be fulfilled.".
With

evidence

this

month

that

the

interna- thread of optimism reported in
growing January may have been more than
rivalry for military supremacy, it 3ust 'whistling in the dark.' This
Js natural that the military de- results from the fact that one of
partments should sponsor basic re- our most sensitive indicators, new
search.
This is particularly nec- orders, has taken a definite turn
essary since no other agency of f°r
the better. 24% say their
tional

the

continuing

tensions

and

the

the Federal Government is, today,
in a position to do this adequately

for general fields of endeavor. The
Atomic Energy Commission does
sponsor research in the area of its

interest. For the broad

government

ever,
t"

fields, how-

has'

aid

come

•

(1) it has not been established to the complete satisfaction

of this Committee that

operations
der the

within the power of the Commission

comes

with possible

Sec. 2. For the

Committee

that

should

grant

not

operations
the

until

reasons

the

stated above, it is the sense of this

Federal

Communications

Commission

subscription

Act

1934

amended

Feb. 19, 1958, by
of

the

concerning subscription television.

lower

out specific

search.

conviction, how-

high inventories of finished prod-

ever, that basic research in educational institutions
especially

Foundation

forcing layoffs in many
industries. 57% of the Committee
members report employment as
down
this month, the highest
number since February 1949. Only
panies in any greater proportion ,8% have noted any gain in emthan during the past .six mbnths.vployment over January.
"In general,
littleJ 'change is
■
•

Congress has established an
appropriate mechanism for sponsoring basic research through the

noted Some industries such as
°ol'cy
aircraft, chemicals, and oil state
"Abandonment or deferment of
they have relatively fewer gov- expansion programs is reflected

Using the National Science

sense

of the Senate that

authorization by law, authorize

television licensee

are

following Resolution:

"RESOLVED, That it is the

portion thereof,

over

not, with¬

permit

viewing

any

toll, fee,

the general public

for the privilege

received

agent thereof to impose

subscription, or other charge

programs

•

adoption by

the Federal Communications Commission should

ucts

action

the Interstate and Foreign Commerce Com¬

Senate

the Senate of the

and

that date the Committee voted to recommend the

•

(2) Public announcement has been made of

mittee

television

the Commission to grant such authori¬

empower

zations."

for

contemplated in such First Report unless and

specifically

Communications

authorizations

shorter work weeks are among
methods being used to retain
valued employees. In spite of this,

present business situation
is government spending. Therefore> our special question for
should not be as dependent as it February sought to find
out if
is today upon the programs of the government spending was being
military departments. *""
channeled into our members' com-

partial

injury to such present system in particular

largely from the military depart- ment in the new order situation
ments. It is right and proper that that has prevailed for months.
the military departments should
"One major factor that is being
sponsor
uncommitted basic re- closely
watched in conjunction
It is my

communities, if not throughout the United States.

they have been able to effect
reductions in the last 30 days,
39%
say
their inventories are
about the same, and the 15% who
have more material on hand say
that this is caused by lower production schedules rather than any
situation has improved. This com- desire to increase stocks,
pares with 15% who reported improvement last month. Only 31%
Employment
say it is worse, as compared to
"Unemployment continues to be
48% showing a poorer situation of major concern to companies
last month. These figures mark a represented by our Committee
reversal of the downward move- members. Reductions in shifts and

schedules

un¬

provisions of the Communications Act of 1934; and

(2) such operations might lead at least to

say

production

•

authority to license such

blacking-out of the present system of television operations,

good time to buy ahead. 46%

■

the

manufactured items. Manufacturers ?re desperately searching •
cof}

RESOLUTION

•

/ ;
will offset the lower prices they
Experience shows
a
growing effort are reaching new postwar a^e having to quote so as to obtain
pattern of support by industry at highs.
All materials are readily
oraeis.
educational institutions
for
unavailable.
Expansion
plans
are
Inventories
committed basic research and for being
reviewed
and
many
are
"Purchasing executives continue
fellowship aid in graduate train- either being abandoned or de- to be extremely inventory coning. Here, industry needs to do ferred. Order lead times are being scious. Most are taking all steps
more.
But even with all industry shortened further.
possible to reduce further their
might do, the requirements for
"But, with all of these pessi- materials on hand. There are no
basic research at educational in- mistic reports, there is concrete indications that
any believe now
.

On Feb. 6,1958, that
sense of the Com¬

expressing the

mittee in the following terms:

•

But for all industrial laboratories

Docket No. 11279

SECOND REPORT

REPORT

By the Commission: Commissioners Mack and Ford not
participating.
(1) Since the adoption of our First Report in this proceeding
on Oct. 17,
1957, subscription television has been the subject of
active interest in Congress. In
January of this year the Interstate
and Foreign Commerce Committee of the House of
Representatives

Agents' Business Survey CommitComPftltl01} 1S. forcing prices of
knowledge. But this, taken tee, whose Chairman is Chester F. ^
materials down. Not
together with that generated in Ogden,
Vice-President, The De- since 1954 have so many Commit-_
institutions

COMMISSION'S

gov-

new

'educational

To Provide for Subscription
Television Service *

latest

advance in

our

subscription
specifically empowers

Congress

Amendment of Par 3 of the
Commission's Rules and Regulations
(Radio Broadcast Services)

unemployment and find
nothing in short supply. .
«
..«

Purchasing

until

In the Matter of

mittee members express concern about
'

resolution

—

Though little general change is noted, purchasing agents busi¬
ness
survey group detects upward turn in new orders. Com¬

They

do this because
obligation to add to the
new knowledge.
They do
this also because they have learned
that they respond faster and make
better progress in applied research

•

operations

TEXT

undertaken uncommitted, basic re¬
search in the broad areas of their

passed

such quasi-judicial-administrative action.

balanced for basic and for applied
research. These organizations have

Up to Congress

Commission

Feb. 26, reversing its scheduled
processing of pay TV applica¬
tions. The Commission decided not to authorize

military programs.
With events in such change and will not be swerved.
This is a
During the growth of industrial turnmoil as they are today, it is task of large magnitude. It is on

research, during the half century
just passed, there has been a maturing process for at least the older
organizations. Knowledge has de-

or any

television

television receivers located in the

home, with the exception of both community antenna sys¬
tems and those programs

transmitted by cable or wire of

both/'

\ ;

:"M

Wt:-'

The

National

There has been
the

funding

"Foundation

steady
the

for

Increase
National

Seience Foundation since 1951. But
if

the

Foundation

ernment contracts than during the this month

last six months. On the
hand» electronics, electrical
fscturing,

that

needs for basic research results to

the

military and the com¬
mercial programs. The task of the
Foundation should be to

assure

the

needed effort in basic research, the
flow of new fundamental knowl¬

edge

and

scientists.
ficient

the

supply

trained

What is required is suf¬

funding for

the

National

Science Foundation to sponsor research on a long enough time basis
so

that the work

can

be scheduled

efficiently and moved forward effectively. This is a present and a
move

world

ing but ever-increasing. We have
.meed for increasing, strength
in
science and in adding engineering
applications to our defense weap—

,'pns

storehouse

and

our

non-

expendi-

to Mouth

for which a direct

00 Days

to 1 l'r.

FEBRUARY

that

Production Materials

MRO

intends

—,-

Capital Expenditures

"High

"On the down side

Commodity Changes

inventories

are:

consider it

Copper,

finished brass, steel, tin, lumber, oil, gaso-

products are fprcing price con- ]me> rubber, textiles, and coal,
eessions of many kinds
«In short suppiy: As in January,
?n th<;
side are. Electrical
„
equipment and fieight rates.
n
g.
J. L. Stoil
LOS ANGELES,
.

COnductine

Calif.—Jack L.
an

investment

from

offices

Hollywood Boulevard.

...

Ga.
_

—

Bert
_

Kent are now with Southern

6381 states Securities Corporation, 64
Ponce

Leon

Boulevard.

hold

hearings

the Bills

now

It has been

this subject.

In these circumstances,

the pending Bills

it becomes

reason¬

proceeding.

authorization

legislation would,

of course, moot this

If Congress should decide to give express
the

Commission

authorize

subscription

television operations on a trial or any other basis it may be
necessary

depending

to modify the conditions set out in the First Report,
on

the requirements laid down in any legislation

this subject.

until 30

television operations will be processed

days following the sine die adjournment of the 85th

garstin, Alton E. Lutz and James
F

Foreign Commerce Committee that

appropriate to maintain the status quo.

duct trial subscription

(Special to The Financial Chronicle)

ATLANTA,

(5) Accordingly, no applications for authorizations to con¬

Join Southern States

Opens

^toU 1S conducting an investment
business

entire

(Special to The Financial Chronicle)

would

ably evident that no action may be expected on them, we

(4) Prohibitory
Specific

Committee similarly intends to hold hearings on the Bills in¬
troduced in the Senate

until Congress acts on

MRO

the viewers,

announced that the Senate Interstate and Foreign Commerce

Production Schedules

such authorizations by the Com¬

the subject of subscription television.

JANUARY

Supplies

The Commission has been informed by the Chairman

Committee

pending

Supplies
Capital Expenditures

charge is imposed

place certain restrictions

0 MOs.

•30 Days

which, if enacted into law, would either prohibit the

of the House Interstate and

Reporting-

Hand

with

tensions of cold war, ever-chang¬

on capital

Houses

Bills have been introduced in both

numerous

authorization by the Commission of the broadcast of programs

mission.

-Per Cent

pressing need and obligation.
We

commitments

machines tures.

should

be, then the
current funding must be greatly
increased. Here is the organization
which is in a posftion to assess the
meet

oifice

the continued short-

other ening of time reported[for forward

manu-

the

"mechanism it might be and I be¬
lieve

and

(3) Recently

Congress.
FEDERAL COMMUNICATIONS COMMISSION.

Mary Jane Morris, Secretary.

The Commercial and Financial Chronicle
32

Thursday, March 13, 1958

(1176)

that it is

Continued from page

is thus available without the sale with the estate tax. The result of
of property. The sale of thrown- sale or merger with a large com4
always^wise to reduce>4:he^er?tiip^ interest ^Tn^h^ b^ne^s - panyv is also that-?the-'smali-tcenir ^
estate tax in the husband's estate firm-may-thus be, averted.This, Jpany -j. disappears/'as*/a ^ep^ratelf
as
much as possible.
The estate is the liquidity aaVantage of the* entity, lit is either absorbed in-' *
tax is progressive, ranging from
charitable deduction.
dislinguishably into the large cor3% on the first $5,000 of taxable k
Since less property need be sold poration or 'becomes one of its ,7
always wise to take the

maximum marital deduction: it is
not

Estate Taxes and Business Mergeis

„

there has

whether

100%

been a

This is provided by

redemption.

Section 318
of the Internal Revenue
Code.
Care must be exercised to avoid

the attribution rules of

application of these rules,

the

Finding the Money

in the
redemption plans

The major problem

stock

case

and

cross-purchase agreements is that
of money. Where will the money
be found?
The corporation can
of its

stock out

redeem

available

this

privilege is often
restricted by state law (as in New
York State) so that redemptions
but

funds

only be made to the extent of

can

surplus. Thus a stock redemption
plan may not in fact be effective
even though it exists on paper.

placed
the shares held by the estate
estate tax purposes?

increase the valuation to be

stock-redemption plan

Insurance
in the

provide the funds

can

both the scock-re¬

case

demption plan and the cross-pur¬
chase agreement.
The proceeds
redeem the

used to

can

holding
is

shareholders

insurance on

the other owners,

three-fold:

partners

the premiums are

(1)

paid with atter-tax money which
may be a greater burden on in¬
dividuals than on a business unit;

pol¬

(2) the number of insurance
icies

cumbersome

becomes

cies

pointed

(3)

existing policies on the other
survivors from the estate of the

The premiums are gen¬
erally not taxable to the share¬
holder. An exeception may exist

company.

where there is

sole stockholder

where the insurance is not for

benefit of the corporation, in

the

which
may

case

the premium

payments

be treated as dividends to the

shareholder

and

taxable

him.

Until recently two Tax

Court cases
put a damper on stock-redemption
plans on this score.
These are:
Oreste Casale, 26 T.C. 1020 (1956)
and Henry E. Prunier, 28 T.C. No.
4 (1957).
Both cases have been
reversed by appellate courts: the
Casale case by the Second Circuit
in Sept. 1957 and the Prunier case
by the First Circuit in Nov. 1957.
In the Casale case the appellate

court held that

premium payments
by a corporation which was the
named beneficiary and clearly the
owner
of a policy on a stock¬
holder's life, were not taxable in¬
to the stockholder. The court

come

emphasized the fact that the pol¬
icy was a corporate asset which
would be subject to the claims of
corporate creditors in case of in¬

The difference between

deceased.

purchase price (plus future pre¬
miums) and proceeds may be tax¬
able as a capital gain. ?;

wife has separate property

the

may

bracket

result

tax:

Sih»
the

•

total

less

took

than,

the

minimized

maximum

equalizing

,,oes

these problems
definite enough

the

Summary

estate (to pay estate taxes and.
funeral and administrative expenses) but it is no easy matter
to comply with these provisions;

;

Ji":

•

easy,t° turn shares of $
if-'fusvly-iield ^company into cash

practices./'1.01" \s

of business firms in trying to en-

or a

the wife will Jisve

The loss

earning

Recommendations ;
.,

older to avoid or.rcducc the

of th^ v

power

complied with.

eYcn i£ the law is

the survival of the firm de-

sure

howemueh
th- delth
°l »'•.% cH«c|ltive
much SpUe major
shareholder-or partner.
how

Question is, against what
wU1. l.hey bet /PP1"* '

"^re are provisions that facilitate
the liquefaction of part oi the-

t0 charitv

®ir-; N

'*■■ *?

■

"1 ??ur£ organization are

likewise

have reviewed the

sure
suie

Major revisions in the estate tax '
.

no capital gains
appredatea property tliat

difficult, of course, to calculate the right amount of marital
nevei

...

„

bered that there is

It is

can

cannot cure the main

rest

excessive Valuation'of.'-

two estates.

«S°MvZthbe
be

the

and

St °"'eer <»» render first .;

between. Ihe

be offcet It shbuld be remem-

than

tax

raised, l)ence.;;but th«
potentia, rise ip the estate tax »™ount

the

necessaiy.
Die
total tax in the two estates would

higher

divided

deduction and

deduction and paid a

marital

insurance underwriter

The

closeij-heid"

the stock.-If the "valuation (he,."^fary to solve
t k , raised the; charitable de, Pf tax rates are

elates

would be greater than it

agajnst

that

two

the

of 'he estate, there isralso a hedge

would

this

of her property

By Minimizing Taxes

charitable

?.ln
T^J1SfJ
than »
hei
hu ba

i,ii

„

prop-

deduction.

company

put her estate
tax

stock in the

If the

take to augment her estate

The

there'is

available' (including

charitable

be a mis¬
by the
full marital deduction. This might
in large amount,

Maximizing Business Survival

to pay taxes,

ert

tax

the husband had transferred Jess f»0P«ty
o his wile even if that meant that

portion

at least own a

over

estate

husband's

poli¬

policy on each of the others;
there may be a tax problem
involved in each survivor buying

previ¬

out

amounts

iu*

To the extent that we

the

other share¬

of the

each

holders

stock

ously, the premiums are non-de¬
ductible expenses and the pro¬
ceeds are
non - taxable
to the

77%

the

since

each shareholder must hold

from the estate or from the bene¬

ficiaries.

nnn nnn

cin

$10,000,000.
reduce

the

Insuring

estate

subsidiaries or divisions. ;* •
Thus es.tate taxes are driving /
property that is ultimately to go small business ;intq the arms of!jr
Insuring a cross-purchase agree¬ through the use of the marital de¬ to
charity) to earn income for'.^be big corporation.-They are also V
ment
duction we add potentially to the
the income beneficiary.' Thus'the* driving the lawyer and accountant X
The difficulty
with individual wife's estate, hence her estate tax. income beneficiary gains from ihe .onto the couch of' the psychiatrist. /
on

for

■*

may consider how
individual who has built up a

Finally,
an

business

the

increase

can

survival

its

chance

where

even

re¬

capture of the ownership interest
is
not
feasible.
Perhaps he
is
uninsurable or he cannot reach
agreement with his
stock

redemption

associates 011
other

estate

that

chance

plan

minimize

the

ownership inter¬

the

est will fall into inexperienced or

what she looks like.

that increase this unhappy chance?

Heavy estate taxes may force the

liquidation of some of the owner¬
ship interest.
The new share¬
holders may wish to liquidate the
firm itself or otherwise operate it
in
a
manner
inconsistent with
survival.

Thus

major

shareholder will wish to minimize
estate

the

for

taxes

sake

survival of his business

the

for the benefit of his heirs.

through

estate taxes.
sale

^i
ced sale
What ol a

a ;major

eliminate the problems to some X

degree
-

TT„

...

stock^redempijLon ..X^lcer^a,^3r ca^ be relieved by:
to meet -pjan or a cross-purchase.-agree-£f ;.(l)
the subject of valuation,
vpluntaiy
ment<
Under a stock-redempiion - having the Internal Revenue Ser-

y
?e! m iS ua
estate which

Je2

ital deduction

stockholder or
or partner can be;**"
sloc.kJ10|Cier
partner can oe as-^
gUre(j through a

1 his too can

by the widow.

death

;

wice give rulings on the applica-V •
the stock of the deceased." Under 4ion of a taxpayer on either the <

pJan. the company- agrees--to

gives

buy

cross_ purchase -agreements *i"th e
method of valuation used in a par-;;
life
survjving stockholders or partners tticular stock-redemption or crossEstate
agree to do s0
Either may obtain • purchase agreement or on the aeon her death.
(Tbls ls not the 0W-the
necessary funds /through Hie;tual valuo set-by such agreement,
kind of tiust that qualities foi the
insurapce on the stockholder- or ..Approval of the method would at -

the

wife

and

has

the

to her

corpus

with

trust

deduction.

marital

dunnto

income

rowing

There

partner.

to appoint , by will has advantages in the likelihood ot boi-

power

against ,the corpus during,

are*

"mariyu-Jegal -least narrow the range of valua-

'ready

pitfans

un^er either

to trap the unwary- lion uncertainty. -Approval 'of the
arrangement-. ' "
■■■
actual value, would,of course,elim- .?
cannot..1)e

stock

rfo'pmp^

hxr ihfx

kc.

finale uncertainty as to value. This

would require an increase m the -r-

nnmnanv

Every

of busi¬

the sake

the

dif-

estate tax can accordingly relieve /

-•

contmuity-,pf/.^e:tbysj.hC^$

alter

firm

major shareholder has a right to
encourage the others to minimize
estate taxes for

The

thetheownership
interest fallings
hands of sti ange

into

me->

well

»>ut

The minimization of estate taxes

will

insurance

through proper use of the marital
deduction can reduce the chance

hostile hands. What are the factors

business

by the firm.

abilities of this without knowing

pur¬

chase arrangements. He must
his

The proceeds of ti)e •qui1Vty' "The
X1!?
cotttpensate' the
responsible, for this situafirm in part at least for ihe toss J?"
it does aggravate the
of earning power.
// "-ficulties involved. Revisions in the

estimate of the prob¬

not make any

^yto'raifthe'fcg7Srrelf'herfn^ -

importunt consideration is to get

•<?)• On-the subject of the attri- t

survival.

ness

than the wife to vote it in in accor-

Use of the marital deduction

One of the important devices

decedent's

the

with

dance

view

-j

-Internal

-Attempts are made' -to minimize

•

^ich

Code

Revenue

estate

u n

d .e-r

presumed

•

estate taxes so as to-reduce oie^own the stock independently held
minimizing estate taxes is the mar¬
solvency.
chance of forced sale of tne stock. by any beneficiary of the estate- '
ital
deduction.
The
full
amount
In the Prunier case, the appellate
caiibe aided by proper use of
prevailing -impression of tax
court reversed the Tax Court left to the wife up to one half of
^e marital deduction.. lhe $tock practitioners is that this section
the gross estate is deductible from
which had held that premium pay¬
may be left in trust SO; that ithe was in - conceived: and hastily
estate for tax purposes.
It
ments by a corporation on life the
widow cannot touch it durmg life drawn.
,
•
must be remembered that the tax¬
insurance for two major
stock¬
even though she derives the ip(3) On the general problem of
holders constituted taxable income able estate is usually greater than
for life and
the corpus on her come from it.
In so far ..as^thfi ^reducillg uncertainty, the estab- to the holders. The purpose of the »vJhe estate that passes through the
death to the children. If the bulk stock is left in a trust/that ;does nghment of a ^single, nation-wide '
will (the probate estate). For in¬
policies was to permit the corpo¬
of the estate,
however, consists not qualify for the marital deducr upurt of Tax Appeals which/
ration to buy their stock in case stance, insurance usually passes to
of stock in the corporation that; J10"»
^ corpus would . pass woum hear appeals on tax matters
It will
of death. The Tax Court had ruled the wife outside the will.
we are trying to protect, some of
1° the children or others on her,. from Tax Court, Federal District
that the payments were actually ordinarily be included in the tax¬
it will necessarily overflow into
^eatx°'
the stock is to qualify; courts and the Court of Claims
able estate unless the insured has
dividends to the two stockholders
the marital deduction portion of for the marital deduction and^ it,is an(j from which appeals would be
because each had named the other
as

beneficiary.

The Tax Court had
that the corporation

contended

not the

owner or beneficiary
Policies, it was merely "a
conduit" through which taxable
benefits were passed to the taxwas

the

Prunier decision had given
to
considerable
concern

The

rise

life

among

well

up all "incidents of owner¬
ship" such as the right to change
beneficiary. Under a proposal
which has been approved by che

House

Wavs and

reliance

exclusive

tee

Commit¬

Means

cidents-of-ownership

in-

the

would

test

be modified to some extent.

pavers.

given

the

insurance

companies

corporations that

use

life

the

will

wife

outside the

included
if

will

the

deceased

but

insurance policies to buy the stork

estate

provided the funds. Also, gifts that

reversing the Tax Court de¬

cision in the Prunier case, the ap¬

pellate

cited

court

the

earlier

are

found

have

the

been

taxable

made

estate

al¬

though of course they do not ap¬
pear in the will or the probate
(There is now a conclu¬
setts law, the Prunier corporation estate.
presumption however that
could have obtained the help of sive
Casale decision with approval and

also

noted

court

proceeds
if

one

(The

that

eouitv

under

the

C»sale

recover

brothers

policy

had

the

died.

reported

in P-H 72.945 and the Prunier de¬

gifts made

eeeds,

the

book

fully

resolved.

gets the

value

automatically goes Tip.

then

ap-.

shall

Who
how

shall

trust

provisions

stock

so.

trustees

express

can

wishes to the

business

trustees

the

they be directed?

decedent's
the

qualifying

retain

long

the

p^r

nro-

deduction

poses,

estate

not

for

The

estate

merely

the

mar¬

half
tax

8°es to

the

it is reasonable to

It would be unwise tP im-

This

does

not

mean,

Su-

tjiere al-e eleven separate Circuit
courts of Appeal which hear apdecisions of the Tax
In these ways, business firms try
Court. As a result, conflicting deto respond to the estate tax and
cisions exist on the same point of
try to ensure the survival of the, tax law. The taxDaver is confused
business after/the death of key; and neither the <Tax Court nor the
executives dr owners. The com-. Treasury feels it is bound by any
plicated nature of these arrange- particular decision. Only when the

estate trust whereby the corpus-

corporate

States

Court.. At-the present time

trusty such as an

and

competent

:es,
trustees

trustee such
act

as a

corporate

bank is likely to

V and to provide
conservatively

her estate on her death.

■ pea]s fr0111

the estate taxmav drive the owner |ake
to yield to a much simpler soiu-:
tion: sell out.

continuity of trust management.

orobate
however,

Use of the charitable deduction
The deduction for

ity

may

used

gifts to charincrease the

liquidity of the estate, increase the
income- beneficiaries

gale

mei.ger

during the life-

time of the principal owner offers '

,Sn

The.owner receives,

seven

what the

stnele:

authoritative

The

problem

reduced bvr
-

(

j)' Making
.pUrposes

is rto
determina''
' "
:

there

i*eason

tion of the law.

no-one*.

is, :w''the
for the */

law

that

eight'"

^esotiihe,

th^

simnle

the best wav for the individual to

minimize the problems of uncertainty and illiouidjty involved, in

ion'g

knows

Conclusion
•

of illiquidity can
." ; ~ ■ *

stock

redemption

of estate taxes and

and reduce the risk of unfavorable

the estate tax.

valuations bv tax agents. Property

either cash or the Psted securities funeral and administrative.. e$of the large corporation. If he re- penses in fam'iy bu^inesse^ free
cmves securities he nsvs no caohal 0f
percentage restrictions (now
gains tax; nor does his estate. The' ' ^
by section 303 of the Inresult in a^y cese is th^t neither
~: ~ a
'

left to charitv

(including univer-

the* sit.'es!) is deductible from the faxr>nr-

v^i^h passes bv will.

s^are

Does this

ital

marital deduction.

prem€

The
the

survival

exhort

and

United

the

da^en

must be exercised to set up

care

pronriate.

benefits

important to remember
these points in getting the maxi¬

g^oss

hoen

comoanv

not in contempla¬

ho<3

vet

are

tion of death.)

mum

not

than three years

before death

cision is cited io P-FT 73.023.)
there is one difficulty here that
When the

.to be kept out of the wife s hands,

deduction

marital

would

Massachu¬

insurance

decision

trust

actually

contemplation of death will be in¬
cluded

estate.

estate

taxable

of deceased stockholders.

the

less

the

Similarly a joint account or
jointly owned property will pass
to

likely than the wife to
sell the stock to strangers.
The
stock could be put in trust in that
part of the estate which does not
qualify for the marital deduction.
An
example would be a trust
which gave the income to the wife

and

able estate

even

life interest

is reseived for another b°oeficiarv.
The

taxable

estate

and

estate tax are reduced.

thus

the

More cash

•,

nor

his

serious

be;r«

npod

the

problems associated

- f

any

ternal - Revenue Code)
mune to

and nn-

claim that the re-

Volume 187

Number 5724

The Commercial and Financial Chronicle

(1177)

demption is substantially equiva¬
lent to

(2)

family

businesses

over a

dividend.

Allowing the estate tax in
to

10-year period

agencies to buy debentures or
non-voting stock in small corpo¬
rations

spread

owner

matter

estate

right.

A proposal of this sort
is now before the House
Ways and
Means Committee. .This provision
should apply only where the re¬

death

the

principal

to facilitate the payment of
taxes where the corpora¬

tion has insufficient funds for
These

have

recommendations

re¬

the

2002;

been

is not exer¬
cised. At the present time the tax

2203)

The

extend

may

the

Commissioner

time

ten

and

missioner;

required

should security be

in 7;the> case( of

family

y'J

business.

(3)

Encouragingor authorizing

existing

governmental

din

tax

Industry

removing the

estate

element of uncertainty

illiquidity

be said to

we may

be reestablishing a "free market"

whereby a proposed
merger will be accepted or re¬
jected on its merits by the parties
without

the

bias

intro¬

duced by

peculiarities of the exist¬
ing estate tax,
;
*

Bell

Aircraft

makes

wel1

the

components for missiles.

rnately 47% of its sales
s- Government,

for
I

52%

Bendix

Bell's

the

activities.

Aviation

contractor
and

Missiles account
is

the

for

the

prime

Navy's

engaged in other

Talos
of

areas

missile program.

.Burrough's

Corp.

has

But

awarded

new

electronic guidance computer being used in the Atlas.' .vV'*
4'•

industrial aspects of

•

terms

dollar- sales

a§c

economic

the

The fruits of the space age will
will
of

just the military, but

filter down

United

States

every

life.

The

electronic brain that

guides

sile

run

satellite

can

corner
same

mis¬

auto¬

perfected,

meanwhile, is undergoing a cor¬
porate and technological revolu¬
tion

proof tubes that won't

satellites.

There

will

rocket

wear

rocket

out.

airliners,

freighters, and rocket mail

ships.
The Vice-President of General
Tire & Rubber Company recently
predicted in Los Angeles that "the
year 1975 will see supersonic mis¬
siles for passengers, for mail, for

freight of all kinds." He indicated
that

Aerojet-General,

will

strategic striking force for several
more years. The aircraft industry,

mated factory. Radio and televi¬
sets will have tiny, shock-

sion

aircraft

manned

continue to form the bulk of our

because

shift

the

aircraft

manned

from

missiles

and

Cutbacks in orders for

manned aircraft, have caused pro¬

found

readjustments
for
some
companies, particularly those that
did
not
develop the necessary
"know how" in missiles. Total

em¬

ployment in the aircraft industry
dropped from
the

peak of 900,000 at
of 1957 to 800,000

at the end of the year.

The

subsidi¬

President

Aircraft

the

its drawing boards the Industries Association predicted
design for a jet engine that could on Dec. 26 last, that programs in
cut
transportation - between Los the fields of missiles and space
Angeles and New York to less- technology would make up more
than an hour. And in July, 1957, than 35% of the aviation indus¬

has

ary,

the

Executive

Vice-President

©lin-Mathieson,
predicted
that
high-energy fuel to power super¬
sonic jet-airliners and rocket ve¬
hicles would become
a
billion
dollar industry within the next 10

' '

years.

,j..-„

Even

at this preliminary stage
"space age," the research,
development, testing and produc¬
tion
of
missiles, satellites and
space flight vehicles absorb the
energies of more than 300,000
i

the

people.

Thousands of companies
across
the
United States, from
giant, airframe manufacturers to
small

electronic, specialty plants
producing such items as magnetic
memory drums for missile guid-,
ance
systems, are working full
shifts. „| The Atlas ICBM missile
contracts alone
spread through
.

hundreds

United

panies. Six thousand

States

com¬

persons

man

the missile firing range at White

Sands, N. M. Nearby, the Army's
guided
missile school
at
Fort
Bliss, Texas,, has a steady student
population of 4,000.
Thousands
more civilians
and military men
and women help fire and track
long-range ballistic and guided
missiles fired from Florida's Pat¬
rick Air Force Base.

.Manned

Aircraft's

Future

Already the rapid growth in
capabilities has curtailed

missile
the

need

used
and

and

in
in

for

close
air

Nike

interceptor aircraft
support of troops

defense.

Nike-Ajax

Hercules

missile

launching bases ring most of our
important
cities.
The
Bomarc
ground-to-air missile, with an ef¬
fective range of over 100 miles, is
in production and is slated soon
to protect our shores.
Likewise,
the

Army's ground support mis¬

siles La Crosse and Hawk

are

production.
Because complex technical prob¬

try's sales by the end of 1958. He
further predicted that unfilled or¬
ders for missiles were expected
by the end of 1958 to comprise at
least

50%

the

facturers'

aviation

manu¬

total

military backlog.
By 1960, at the latest, more than
50% of the entire aviation indus¬

try production will be devoted to

missiles, satellites and

space

flight

projects.
The

transition

will

the

manned

frame

builders

are

Many companies,
other

have

this

obtained
new

good

market

industries

positions

because

in
the

electronic, equip¬
ment needed and the wide diver¬
vast

amount

sity of
cial

plants and the spe¬
required.
Electronic

power

skills

equipment constitutes roughly
50% of the total cost of

compared
modern

with

missile,

35%

some

for

such

General

fits

...

#«?+/?
Electric is responsible
Afin10SonS°mh^?Ve^lopme:nt of
*?Si
Thor missiles, for
L'ChJt^aSfleTf1V-ed *}
m
aiS° £\Ue
lawIlSJ
velopment of five controlie and
*

guidance systems for Polaris.
*un

laigest

telemetering

and

r™

•

electronic

f1 n»

con-

missiles.

is heavily involved

in the

Lacrosse, Talos, Bormac, Rascal,
Sparrow, Terrier and Atlas proThe company designs and
equipment for launch-

grams.

nutronic Systems, Inc., which in¬
to

take

missile

project

when they

(4,000 to 8,000 miles),

prime

contractor for the Navy's promis-

ing Polaris, which represents its
major participation in missiles,
By the end of 1958 missile work

Martin

Company

the

prime

Vanguard earth

satellite project and the Lacrosse,
Titan. In announc-

Matador and

$810

million

manned aircraft.

employees

are

engaged in mis-

Northrop
contractor

....

Aircraft
for

the

Snark

prime

ICBM.

According to a recent statement
f
President missiles account
tor 57% of its elioit.
company,

makes

relatively
radar

new

and

an-

systems, digital computers,
telemetering systems and checkout equipment.
Its operations in

th^missile field account for

should
to

the

field

may

unusual
sciences.

Yet

Siegler Corp. among the first 10
electronics suppliers to the missile

field, works closely with Convair,
having
built
electronic
instru-

permeated

today.

our

industrial complex

in
in

for

the

Atlas

Martin's
and
ana

project.

Titan fabuilt
built

portion of the Snark's ground
port equipment for Northrop.

a
a

sup-

research

Just
vides

has

its

appraise
merits reliably.
In

considering

born.

have

lost

When these
their

devas¬

and

richness

human

been increased im¬
,

It brings this
about simply by
creating gradually a more intense
feeling of belonging to the same

planetary community. This will
provide the necessary conditions
for greater effectiveness of eco¬

sur-

nomic and social

measures aimed
raising the dignity, as well as
responsibility, of man. Such

the

industrial

and

inhabitable Earth satel-

lites of four- to perhaps 10-person
capacity

Likewise, the environment on
Space stations will offer development of special and radically new
industrial

was

place

over
this planet than any other
single economic or social measure.

potential

medicinal benefits from satellites,
d becomes particularly apparent
that these utilities depend decisively on the success of programs
tor ™am}ef hypersonic gliders
capable of decent from space, and
sman

which he

local

over

fostering such development*
space flight is likely to contribute
more
material and spiritual im¬
provements in living standards all

possibilities of

and

been

satellite therapy and satellite

man

measurably.

by the sun in space may furnish
therapies against cancer, skin
diseases, and so on. Apparently,
thought

history

life will have

organic

enough

other¬

flight tend to
fundamentally unifying

dividuality of human culture, then

ture conditions, existing simultaneously in space with weightlessness, could be found useful in
some medical applications.
Controlled local or overall irradiation

n?*

pro¬

planetary

space

customs,

freedom

disease,
disturbances, bone
diseases, and perhaps for surgery
in certain aspects. Low-temperaother

tribute to the local color and in¬

heart

tating capability of arousing mis¬
understanding,
distrust,
hatred
and war among peoples, without*
however, losing the ability to con¬

many

however, be of advan-

cases

satellite

obtainable

not

will

Many
can

the earth

anomalies

gravitational pull — norconsidered a nuisance,

and

Ther¬

elements

programs

measurements

wise,

mally

which

added to this list.

unsuspected ways. Weightlessness
—
which
prevails
outside
the
earth's

scientific

significance.

determine

is frequently
space-biological repractical medicine

find equal benefits in

These

processes.

•

improvements, in turn, will not
only increase the utility of space
flight, but will unlock creative
forces in all facets of human civil¬
ization.
These

cascading

cons^quencesi*

whose potential exceeds our

ination—just

imag¬

the consequences

Columbus'

discovery exceeded
expectations—may be among

his
the
of

most
space

mankind.

important contributions
flight to the future of
*

are

too

highly complicated to discuss
with clarity in so short a space
as

this.

Let

the four out-

list

standing features of

should

someday
second,

Reaction

bring

medical

space

prove

value:

extremely

which
great

first,

vacuum;

low

tempera-

tures and large temperature differences; third, intense radiation
from
infrared
to
x-rays;
and

fourth, weightlessness,

Unquestionably

the

during

periods

Company
Opens in San Francisco
(Special to Tub Financial Chronicle)

SAN

Street

most

im-

'cold

where Prestl§e

lass

the leading military

Both

with
to

offices

engage

at
a

301

Pine

securities

Emmett A. Larkin

limited partner
were

formerly

in the firm.
with

East¬

land, Douglass & Co., Inc.

;

Citizens Sav. & Inv.
HATBORO,

ing
been

However,

Calif.—
has
been

FRANCISCO,
&
Company

Larkin
formed

business.

1S frequently
important than force in international leadership.

war'

Larkin $

general partner and Earl S. Doug¬

Political value

Denver
Denver

several

will

which

mentioned

some industrial

are

characteristics

benefit

rtlitv
cuity

The fol¬

and

fundamental

vehicles,

for

sile work

mentation

lowing quick rundown

the
the earth'a
yet not known, but are

distance,

character

the extent to which missiles have

zation and maintenance.

The com-7

mass,

these atmospheres contain.

serve

ative

tion and manufacture to its utili¬

moon

stress the

North American Aviation is the

nation's leading producer of liquid
prqpellant
rocket * engines,
making-the power plants for the
Redstone, Jupiter, Thor and Atlas
missiles.
Approximately 35% of
all

can

for

concep¬

earth

The environmental conditions,
particular to satellites or space

tage

contractor for the

nations.

altitudes

transmission,

ing, checkout, radar, and interial
guidance.
-

is slated to reach 20%
company's total volume.

all

great

mentation

from

and
con¬

as communication links for intercontinental radio and television

This may,

Lockheed Aircraft is the

are

companies only begins to suggest

it through

extend

existence

the

measure

moon's

and therefore
of

The company also did the instru-

see

;

will

comets

stability of magnetic fields in
bined

prediction

nmdiate benefits to be realized
i10™.
conquest of space are
Political. The value of an advanced position in space flight
development cam??t ,be, doubted.
This factor is particularly imper-

and

surveying: nection with sunspots.

instrumented satellites, especially

produces

Ford

tends

weiibeing

search.

International Telephone & Tele-

graph

to agriculture,

-e cou? y' One

Roughly 50/0 of its business stems
H om

Motors, great pioneer
liquid rocket engines, is merging with Thiokol Chemical, maker
of solid propellant engines, maleing the combination one of leading rocket propulsion engine companies in the United States.

Company has set

and
.

?
? P
t
manufacturers of precision
r

80% of its total effort.

Motor

.* Artificial

field'

geomagnetic

monuclear probes exploded in the
Venusian and Martian atmosphere

host of others.

missiles subsidiary called Aero-

the

satellites and space

tenna

and

investigation
of
meteoritio.
-V- matter into interplanetary space

will become more accurate on
contin<-;ntal a,1d local basis. Oron missiles,
Sanized, satellite-based weather
vehicles.
f?,rvi,ce w J result in great bene-

Electric, Sperry-Rand, Raytheon,
Minneapolis-Honeywell, and Avco
Manufacturing, are forging into
missile making and there are a
Chrysler Corpora¬
tion produces components for the
Redstone
and
Jupiter
missiles
and the Jupiter-C satellite.
The

surface.-

Orbit,

Radiation Inc.,

.earth's

astronautical

military plane.

Companies

dust,

space, long-range and

Sery

prominent

the

be- the

ways.

soon as we begin

earth from

^1ye£.f°/?ar

in missile work.

will

■

short-range:, weather

missile dollars exceeded those for

engaged

now

civiliza-

Consequential Benefits

and

aircraft

other
...

-er
-

existence

many

aircraft

industry
to loose some business on balance,
even
though practically all air¬
cause

equalled

Lunar probes will extend
research;
on
cosmic
radiation, meteoritic-

commerce.1

backlog of
military orders, Martin said that

missiles

from

tions will add meteorological and
astronomical observations un¬

this

working exclusively

ing

satellites,

are today well rec¬
ognized.
To
the
geophysical,
geodetic and astrophysieal bene¬
fits, more advanced television sta¬

General Dynamic's Convair Division
has
two
of
its
sections

beginning

and

scientific

instrumental

gineering, science

hand—more than double:
-

one

affected in

our

spectacular

earth satellites

are by
strictly

the

The

Pact of the space age is upon en-5 far out into space.

3, 1957, Douglas reported
backlog of missile work one-

percentage'of

;

achievements

tion, however impressive the im-

On Dec.

the

miles, by which terrestrial areas
be kept under constant sur¬

can

and

°ur

lites for reconnaissance
purposes;

to the

entering

are

limited

pf the largest in the missile field.

year.

not benefit

h° means

gliders

veillance.

consequences

a $37 million contract for
development and production of an

now

moon.

the

neglect

and, finally, free space operations,
up to altitudes of several thousand

Sylvania Electric is involved in
roughly 30 missile projects, making components, sub-assemblies,
circuitry, etc. The company is also
the largest supplier to the missile
field with its line of special miniature and sub-miniature tubes.

been

operations:
for bombing

reconnaissance; the capability
operating satelloids and satel¬

Approxiare

afford

and

Sperry Rand designs and proa wide
variety of electronic

Air

Regulus I and II.

hypersoiiic

bat-

and ground

air-to-ground missile, rocket engines, and radioremote
systems for landing the

ill

can

the potential of space

duces

third the volume of aircraft orders'

lems require a long lead time be¬
fore missiles and satellites can be

nickel-cadmium

powers

support equipment,

Navy's

Force's Rascal,

rocket capable of landing on the

makes

teries both for missiles

backlog, Douglas Aircraft is

Continued from 'page 14 ■sp¬

Corporation

gines.

mergers

involved

Sonotone

ultra-reliable miniature and subminiature radio tubes for missiles,

artificial factor distorting
economic decisions in questions of

(I.R.C. Sec. 6165) This should not
be* discretionary with the Com¬
nor

merger.

security.

the

effect

estate tax

years more and the executor may
be required to furnish

solid propellant engine for
Polaris ICBM.

should

is- due and payable in
full, fifteen
months after death.
(I.R.C. Sec.

privilege

Companies

Aerojet-General, a subsidiary
of General Tire, produces
liquid
and
solid-propellant rocket enIt is making the liquid engine for the Titan ICBM, and the

demption of stock.
of removing the
contributing factor
in the merger of small businesses
into large companies. Perhaps we
can
say that the estate tax has

demption

Cites

and

formed

Grape Street.
is

Pa.—Citizens

Investment

nrinrinal

with

Service

offices

Sav¬

has
425

Thomas E. Corbett
of

the

firm.

The Commercial and Financial Chronicle

(1178)

Continued

from first

ployment benefits and other sofcial
that some four million

page

programs,
workers

scheduled

are

to receive

automatic wage increases in

The Business Outlook—

that

and

1958,
in

further pay rises are

Consequently, they rea¬
son,
consumer
spending should
continue strong and will provide
a
powerful incentive to recovery
prospect.

Why Economists Disagree
during most of the
postwar era, the economic en¬
vironment has been generally ex¬
pansive.
Only
in
1948-49 and
surprising;

did

1953-54

the

whole recede

decline

the

brief. Nevertheless,

was

duration

was

since the

same

its

and

moderate

significantly, and in

instances

both

economy

economic information is available
to

all,

must ask how it hap¬

one

qualified economists
so radically in their
interpretation of the present and
their guesses as to the outlook.
By exploring these differences we
may hope to gain better perspec¬
tive regarding the economy's cur¬
rent position and what may be in
that

pens

should differ

store

the

future.

machinery and transporta¬
equipment—have been hard¬
est hit. Most soft goods industries
except textiles and petroleum are
holding
up
fairly
well, which
again conforms to the usual pat¬
ucts,
tion

tern of recession.

The current downturn

conspicuous

impact

has

had

upon

em¬

ployment

and profits.
Manufac¬
turing employment and the fac¬

easing off
and have
in
recent

work week were

tory

during

much

fallen
months.

cause

1957

rapidly

February, partly

be¬

curtailments

seasonal

construction and trade, unemploy¬
ment

evidently

to about five

rose

million, compared with

aver¬

of less than three million for

age

1955

Stand

Where

Today

So far, the progress of this third
business recession in the postwar

resembles
its
two
predecessors in many respects. Al¬
though the onset of a recession is
always disturbing, it is some con¬
closely

era

solation

realize

that

the

through
1957.
Corporate
profits, too, have been adversely
affected, to judge from the earn¬
ings statements currently becom¬
ing available.
Personal income,
however,
although
sagging
for
to its all-time

been

perceptibly

justment

periods, and that the
pattern of developments to date
is by no means unusual.
which is
of all
and

National

Gross

Product—

estimate of the value

goods and services produced,
thus more closely than any

other

indicator

total

measures

economic activity

has receded

—

only slightly from its peak rate
of last year. Now
estimated as

running at a $430 billion annual
rate, it is only about 2l/z% below
the

all-time

rate

record

$440

billion reached in the third quar¬
ter of
1957.
The biggest single
factor contributing to this decline
was the shift from
art inventory

buildup to liquidation in the clos¬
ing months of 1957, and such a
shift
is altogether
typical of a
business recession. Inventory liq¬
uidation, in turn, was probably
sparked by the more than ample
supply of goods
of all
kinds,
abundant
productive
capacity,
moderate

some

gregate
less

weakness

optimistic

spective

ag¬

buying,

consumer

and a
of pro¬

appraisal

demands

the

period

Thus,

addition to the liquidation
inventories, a decline is getting
under way in another major sec¬
tor of the economy, namely, busi¬

hold, the economic pic¬

ture is neither one of

despair
ing.

virtually
the

industrial capacity

the

board, and
pointing to de¬

across

signs

many

ferments

and

cancellations

business expansion programs, have
clearly affected business decisions
the

and

business

dential

climate.

building,

hand,

seems

out in

1957 and for

has

been

the

have

giving

indications

other

bottomed
months

some

tentative

some

Resi¬

upturn.

Total

construction

activity,t moreover,
well sustained, largely
by the persistent uptrend in pub¬

being

lic

facilities.

Finally, the

defense orders,

sag

which became

unsettling factor in- the
climate

after

year,
has
versed.

been

how long the economy
remain at recession levels,
and
how
long until an upturn
takes hold depends in large part
upon the extent of the maladjust¬
in

ments

the

halted

last

and

production

dropped

activity,

and

new

business

middle

re¬

reactions

businessmen

and

consumers

well

Govern¬

developments already
under way.
It is because these
maladjustments cannot be meas¬
ured

accurately and because these

reactions
be

interactions

and

forecast

techniques
analysis

cannot

devices

any

-available,

now

the

that

economic

pros¬

pects, even over the very nearterm, is today more than ever
dependent upon human judgment.
This presumably accounts for the

prevailing divergence of views
garding
A

re¬

the outlook.

minority opinion is that the

economic downturn has been vir¬

tually

completed and
that
im¬
provement is close at hand; if

correct, this would make

1957-58

shortest

recession

our

the

one

history.

the

other end is another group which

suggests

that

business

tinue to

slide

off

may

and

stand

that

this

Most

between

fore¬

these

two

poles; at present they expect the
decline to end sometime this year
but
even
here there
are
many
shades
the

end

followed
ment

thinking
the

to whether

decline

rapid

whether

will

improve¬

face

long
period
of
lower
activity, with
recovery developing only slowly
as time moves on.
Basically, this
a

broad spectrum of forecasts seems
to be due mainly to differences
in

evaluating the prospects for
key sectors in our econ¬
omy—business inventories, busi¬

various

ness

investment outlays, consumer
for automobiles, houses

demands

and goods in

general, and the im¬
pact of actions by Government.

the

spending

peatedly been
in

typical;

orders down and inven¬

than

Consumer

than total economic

too

the service

industries.

manufacturing

cate¬

our

case

new

that

always holds

This

sparked
a

the

renewed

the

was

and

recovery

business

well in the
early stages of a business reces¬
sion, but that spreading layoffs,

the

led

boom.

optimistic

work

shorter

ing

especially

and

inroads

durable goods,
suffered
a

which

has
already
sharp decline.

durable

goods

has

important

Pro¬

Consequently, it is
that inventory liquida-

believed

the

in
for

aggregate cannot per-

omy

of inventory reduc-

tions;

some rebuilding of
stocks
anticipated within the next few

months.

Against
that

this

stands

the

those industries that

upon

have

the

suffered

backs

the

manufacturing are still unduly
heavy, and that the current weak-

spending on durable goods, outlays
now
being budgeted,:
by consumers and by busi-/ especially since the increased..mil-j
makes further liquidation itary procurement is not likely to

ness,

observers

nevertheless

are

good

seasonal rise in sales will develop
sell

this

that the

and

soon,

still

One

year.

industry

may

million

cars

some

factor

their confidence is that
more

consumers

their

final

bile

debt

are

bolstering
more

now

and

making

payments on automo¬
incurred
during
the

banner

year 1955
and thus will
again be ready to enter the

once

market.
The more cautious business

however,
the

place

an¬

greater

current

upon

incomes and

industries

international

sag

employment, the ef¬

upsets,

how

are

the'

military spend-'

can

mg be expected to trigger an im-

portant
on

course—

rise

business

outlays

plant and equipment,
debate,
likewise,
advisability and

Sharp

sible

sur-

the

rounds

The direction of business spend-

ing

that

doldrums. Nor

until recovery is well under'way.

effects

pos-

tax reduction,

plant and equipment,
least over the near term, is one

The prospects of tax relief have
increased measurably in recent

of the less debatable factors in the

weeks, and if economic indicators

business

continue; downward, a tax cutwould seem a reasonable prospect.*;
As to the consequences of such

new

outlook

widespread

today; there

is
such

that
spending is on a decline." However, some economists hope that
a

turn

agreement

for

the

better

before the end

will

come

of the year,

while

action, however, opinions

eluded

of the economic scene'

Students

we have just congenerally agree
jor investment ; boom- would soon
be

capital

higher

expenditures may last far longer
and
carry
further than: current
surveys

indicate.

need

the

underlying growth
trends in the economy, the huge
and
expanding outlays for research

ment,

and

outlays

a
tax- cut'
translated
into'-

for

goods

and-

stimulation, namely, the
goods industries or^ for]
ft is

durable
that

matter, home building,
contended that spending on

product-develop-

new

the

and

that

services, but many doubt that themoney would be' spent in
those;"
sectors of the economy most in

of spending plans, would
Tfcev optimistic point of

cites

di-f

are

vided.

others hold that

and that the downtrend in

view

alysts,
weight

be of much benefit to important

sharpest cut¬
recession,

sales have been in a sinking
spell in the past few months and
have been running some 30% be¬
low a year ago. Despite steep re¬
ductions in output, dealers' stocks
are at record heights and further
production cutbacks are expected.

both

current

car

The pessimistic view of the fu-'
ture, on the other hand, is inclined
to minimize the the impetus of]
the modest increase in defense t

view

inventories particularly

some

doubt that this will be of im~.*

velopment and production.
Theoptimists, as already noted, place]
major importance on this pros-n
pect; they expect rising orders toplay a major role in improving
the inventory situation as a whole i
and
curbing the downtrend in;
plant and equipment programs.'.

long, the more so as deare rising. The econmay thus soon be relieved of

fense orders

the pressures

the rise, and al-

portant help especially to indus-;
tries connected with missile de-

reasonable prospect.' Also, it is
emphasized that inventories
rarely lead a business upturn;
their outlook, especially for
the# rather, they follow a revival of
automobile
industry, is in
the sales and are not accumulated to
forefront of attention.
Passenger any significant extent — barring

effect

homes and

new'

automobiles, except in;

constant

pressure
marginal instances, is influenced;
more
by current and prospective,
competition and check rising- employment and incomes rather
crease
their debts at this time; costs. The more somber outlook, than
by the relatively minor in-;
also, they suggest that the public; on the other hand, is bolstered by v crease resulting from a smaller;,
the snarp drqpjn orders for mais not overly enthusiastic over the
withholding of income -tax in the1958 models and in this economic
chincry and
industrial build-■ weeklv
dslv
crivclonB
In 1 any'
environment is sensitive to their
ing. falling business appiftpria*;
to the
tions
for
new
higher prices. Consequently, they
..capital projects, and omy from, this source is unlikely
doubt
whether sales may reach
increasingly^frequent reports : of to show up until the latter part;
stretchouts
even the 5 million mark this year,
and
cancellations. 0f the year.
4
compared with 5.8 million in both With profits squeezed and -capac-"
;.:
*
•
.
1956 and 1957.
ity likely to remain excessive in
y xhe International Economy
A
The outlook for homebuilding is many major industries for some ^
time to come, it is
stressed, there'
likewise controversial; opinions
are
divided between those
who may be littlddnducement fo-em-

fects

these

willingness

declines

upon

the

to modernize facilities in order to

in¬

meet

consumers

cXtfan'y'supUrt

econ1

...

e^nom.V

hefn"3 nald

increased

expect
credit

availability of
financing
to
greater activity
and
question whether there
easier

and

stimulate
those who

bark

further

expansion

years

the

houses off the market.

new

The

Role

1954, assisted by the greater avail¬
ability of money and widespread
liberalization
of
lending terms,
housing starts
advanced
mate¬
rially despite the slowdown in
business, and many believe that
an
improvement in housing may
again provide support to the econ¬
omy in 1958. This point of view is

encouraged by the expectation of

yet easier financing to come, the
spurt in applications for FHA ap¬

praisals in January, and the pros¬
pect of further action by govern¬
ment to

make

funds

avail¬

able, at liberal terms, for the pur¬
chase of homes. Others, however,
doubt whether buyers can be ex¬
pected to show greatly increased
interest in new home buying as
long as employment and income
prospects

questionable,

are

espe¬

cially in view of the large addi¬
already been made
to
the housing stock in recent
years and
the rapid growth of
mortgage debt.
'
i-..
tions that have

The Business Sector

The

case

recession
the

for

outlook

tories.

rests
for

speedy end to the
in

large

business

part

inven¬

frequently pointed
inventories, in terms of
physical volume, were not exces¬
sively high even at their 1957
out

that

that
have

tious

wholesalers
been

and

following
inventory policies for

While the

re¬

economy

^ ]300m 1

ambitiou^pftai

programs

lor'

•

some

Government

private sector of the

is aereed

loathe present

seems

waning in many countries abroadas
we'll as in the United States,-

•>';

come.

will be sufficient demands to take

peaks,

unem¬

time.

sist

ness

Since the demand for consumer

tailers

weeks

further crimp into consumer buy¬

school

cushioned

of
basic
materials; steel
for example, have been living off their inventories for quite
users,

tion

are

though present plans of the De-r
fense
Department - envisage
a*
lower level of new orders in the
second half of 1958, upward re-r'
visions are deemed likely. There

stocks

some

Thursday, March 13, 1958

contracts

savings cannot help but put a

thought point to the fact that
are

picture,
however,
spending al¬

consumer

re¬

homes and automobiles

incomes

business

strength

only in the early post¬
period, but again in 1954 and
1955, when vigorous buying of

ponents

prod¬

economy.

has
of

war

metal

a source

not

gory, the durable goods industries
—and particularly the production

primary metals,

the
note

most

con¬

sustained and

depression.

casters

will

throughout the

1958

culminate in

this

being liquidated, the busi¬
ness recession is affecting manu¬
facturing and mining substantially
Within

skeptical students of

upon

ment to the

has

tories

and

economy

...The Consumer

Industrial

with

the

may

serious

excess

reassur¬

continue,

remainder

it is wholly

nor

the year, such outlays did not de¬
cline much, if at all, but the pres¬
ence

unmitigated

How long the downturn

outlays on new plant and
equipment. Through the turn of

ness

reces¬

confidence is restored.

reasonably confident that

Disagreement

always when

sion takes

the
In

Areas

proven

ahead.

The

Some

different

from these previous moderate ad¬

The

very

pace

and extent of the downturn have
not

is still
peak.

months,

some

soon

year, and that on the manufacturing level considerable liquiaation has already been achieved in
the past few months, especially in

saf

prices of basic
.

raw

decl-™
competition

materials have;

foreign trade

?ec01*in« keener and =.caun-:
equally evident that demands by
baltnct of°Davments problems As''
government, both on Federal and
fJ*alj£cJ1~t<^ Unfted States exports-'
state and local levels,:are in a
20^f ^,r'Sljjj
whilo'
at

least

anH

rising trend.
the

over

There is

strength

struction in

dispute

uublic

con-

SSS

construction

projects continue to
expand, the highway program is
picking up speed, military con¬
struction will rise sharply, and the
Federal Government is planning
larger public works. The big question seems to Ije .whether,- beyond

ha^e alreml> slipped, a
11

exports are not large in

«<"'

e a-

°ur

the effect

some

companies

and

be
fairly pro-;
Looking ahead, those
who take a cautious view of the
American
business outlook emindustries.

may

nounced.

mriq

^1^6
?!'
ran"nnt
Unltecl states bus; ss
reasonably assured pros- no]Y exPe9t jUp^^inL?!^-pvnan.'
pects, the
Federal
Government a.nd sustained econom c
p -.
will initiate a sharply increased <Si°n
ab.roa'd'
public works program, andihpw economic conditions become more
long, even if this is dqne,nt will troublesome, as well
y»;
be before the impact of such a v^?1? wou
a
^ prob em •
program is felt in terms, of indus-v
-il0;il^e;
Pr

<-+

these

trial

The
the

activity
and
employment.,:;A Personal View
skeptics point out that; since
At. the risk of oversimplifying
construction
industry as a or misrepresenting important

whole is

continuing to operate at qualifications and reservations of
high rate of capacity, increased individual economists, the diver-,
programs
may
merely,: create gent views on the current busi-.
backlogs and bottlenecks wittio.ut: ness situation may now be sum-;
a

significantly helping emplOyipent .marized
!
and activity in the inahufartturting.
The optimistic school of thought
sector of the economy, the more'"forcsees
steady demands of con-;
great deal of construction ;sumers, augmented by increased
machinery has been produced in ^expenditures on defense, clearing
advance of need.
;up
the, inventory
situation in.
Of perhaps more immediate infairly short order. Thereafter, the.

-v

terest

industry is the prospect

cau¬

over

expenditures.

increased

defense

orders

and

Major procurement

rising Trend of Federal, state and,
local

government

strength

home

s p e n ding,
building, and

Volume 187

Number 5724

The Commercial and Financial Chronicle

(1179)
possibly renewed accumulation
business
to

is
expected
sufficient boost to the

economy to
of

dustries

inventories

impart

the

overcome

reduced

other

effects

advancing;
well

demands mitigating the problems
ot

excess

capacity, business

automobiles

with

stocked,

consumers

and individual

downtrend

their

capital

difficult

up,

indebtedness high,
to

see

upsurge

the

on durable goods in
at this time.
Similar

offing

^pending^shouid
S
holds

that the

growth
near

are

prove moderate considerations cast some
*5 P°sxltlon also upoh the prospects for
forces

than

adinstinpnt
thof
adjustment,andv that

soon

more.

under

Proponents- of

again
differences

Inany

positions
piore
view

way

a •: more

view

and

last vear bv
—•

expansion

mistic

housing year ahead; we may be
the'; doing well if the rate of home
re-■ buUding in:.1958^exceeds"that"of

minor

SLi

once

greater

small

■'1

Moreover, : I

question

creases

margin
©.«.»•

whether

allies in NATO and provide them which have become clear to me
with nuclear weapons and delivery during the time I have been sitsystems.
ting as a member of the Panel on
(7)

Civil defense
overall

our

must

strategy

part

and

taken.

ceded by

and

reduction
ot"
rpnsinn«
reduction
of
tensions

settlement

over the near-term.
thus

prospects

that

are

negotiations

outstanding

take
a-downward pressures on aggregate
fundamental

and

recession

now

progress. By, and large, they inter-,,..including pressures
pret it as a basic and perhaps unfurther^ liquidation

ayoidable; readjustment- after

Billion Annual Increase

.production-and output will predominate- in the months ahead,
from

some

of' business

prices

shift

a
a

costs

an<r;

prelude-

deep

and

of*PrOductive«d..£;.i„
•
of"
productive traded
"depression,

labor-among
indusand labor
among indus
tnes may be required, ^and consid-erable time may

resources

Thp

r a
rflPPnP pvnflndnn

pro-

norinrl'

expansion

period,

everyone

agrees

monetary front through the steps

taken by the Federal Reserve to
ease credit. Moreover, both ConSessional spokesmen and officials
!n
Executive Department have
indicated that the potent anti-recession weapon of tax reduction
cesslon weaoon of tax rednntinn

is oovious

adjustments

rising

tnat sucn an effort

However, although eral years. And it saw no hope of
well^supplied.mth homes thisrnpqint>, of ' view is clearly at a leveling-off in military expendi^
w!)
kinds,
individual
odds
with-the
optimistic
anticipa- tures before 1965.^There might be
indebtedness
pressing^ upon many ^on Gf speedy recovery, I am some offsetting savings on defense
ramify budgets, and the employequally in. disagreement with those in the form of reductions in exment
ouflook less assured,
sig-^who' see ih .the present recession penditures on some existing milinificant
[id
and

and

will be costly. The Panel did not
make precise budgetary estimates.
However, it did state that the programs I have just outlined would

Witn^;Cqn-^;pre^h\^e'yjels^

sumers

cutbacks

Certainly

inventories; there is no evidence
vigorous and sustained capital inyet pf .a bottoming out in ecovestment;boom during which prdnomicvactivity,i When the decline require successive additional exdn^iiy6 capacity has beeh.^ niat'C-^does; tapery-off; therefore, it will penditures on the order of $3 bilually
overexpanded V in
will
many
probably;,be moderately below lion each year for the next sev-

.unportant^industries.

seem

should make every effort to check
the current recession. And much
is
already being done on the

forces,

emphasis

serious

of .the

may

unemployment. Foi I feel that our
maj°r lonS-term problem will be
w to Produce enough to meet
the demands that inevitably will
^ac*ng us *n most fields,

reductions in

accommodate

paradoxical in an at¬
dominated by news of

production

tary programs,

also

brought

bear

However, our longer term problems may not be ones of excess
capacity; rather they may be to
find ways and means to produce
enough to meet the pressing needs

Aid, Education, Resource Develop-

iematicai 0f realization

the

our

ment. Private Capital Investment

Urban

RehabUitaUon
This

does

and

not

that

mean

of the urgent

most

face for enlarged expen¬
national

security,

and

time

provide
for
increased expenditures for educa¬
tion, private investment, health
and welfare, without any sacrifice
same

living standards. To be
we
will be unable to do
everything that everybody wants
at once.
We shall have to make
sure,

choices among deserving programs
as we have always had to do.
t

Steps to Encourage Growth
This brings me to a third major
conclusion — namely that main¬

taining

historic

our

nomic

growth

rate of
vital

future^ strength of
For only a growth
cope

with

the

with

establishment; but those

prob-

success.

for greater expenditures in such
fiairio
r»
fields as: Defense, International

are

need be.

in the more econnminoi
nomical
operation of the defense
or

To me, it is most significant and.
encouraging to learn from the
Reports that we can hope, if we
continue our economic growth, to

ditures

My first conclusion
mosphere

tfon)o^armamStsI1musftU:be^re"
armam^nts must be pre^

yields, principally

necessary,

needs

Short-Long Run Conclusion
somewhat

introduced into

The

foreign economic policy,

spending or tax issues concrete proposals to limit
reductions would substantially af—; any wars that
might be forced
pess.i-^fect the .outlook for consumer du- upon us should be

individual

tax

might
but these would
seem
to be small penalties com¬
pared to what we would achieve.

lllsllilfisl lIvAimiL''
JTIIVV IlClIlUXldl 1*11 VllQ 111

WW 1ft(ft 1

rt 1h° state and local level

■

public

disregarding^rablo"goods
in

even
—

~«/

'•

r>nap

doubt program of fall-out shelters and a
a lusty warning system must be under-

of long-term,

strong even over
that "the present

term,

cession

Continued from

now

sagging,

?um
exPansion programs, so of spending
the

that

and

unemployment

personal income static

man-

agements may soon resume

goods, the outlook
is less encouraging.
These lines
usually do well when incomes are

outlays on plant and
In fact, with increased

equipment.

such

durable

the

our

eco¬

the

country.

economy

can

problems it faces

prospect

reasonable

Issues that can be handled

relative

ease

atmos¬

phere of growth might prove im¬
possibly difficult in a stagnant
economy.

Can we keep up this vital rate
of economic growth? No one can

prophesy the answer to such a
question. Yet, it would seem that
there are a number of steps that
might be taken to encourage such
growth. These include; a revamp¬
ing of our tax system to reduce
the

burdens

initiative

and

enterprise, and on saving and in¬
vestment; better utilization and
training of our manpower at all

levels; continued support of re¬
search; and measures to ensure

o'verborrowing of

recdit

in the optimistic camp;,
there

years.iA^^obS ^a^rlier in our history. The
of eourse; - Federal Reserve since last Novem- viye<

;

At the moment, there •^s^V§qme^o^:Qre^tf^
positions,; market .plage, . and

to the icy, on/which Iiiave the pleasure
interest rates 0:t serving, has stressed in its disthe' cussions the importance oi conof conflicting
opin~- sharpest.drop on record.
♦ tinumto ,the Reciprocal trade
injecting a personal
Furthermore, our economy now Agreements Program, ot making

evidence to support both
this

review

ions

without

interpretation

lof

-the

have, .recently - experienced

features

business

personal incomes and, hence,
spending.
izers :

Deeper Recession
that

suggest

our .technical and economic assis-

programs which help cushion the tance programs more useful and or
impact of unemployment upon encouraging the flow ot private

However, since this would
beg the assignment, I shall, albeit
reluctantly, express some personal
judgments regarding the outlook,
scene.

Sees

variety of Government

were

therein rent-the

upon

These so-called stabil-

have

not

investment in to overseas projects.
Economic and Social Objectives

prevented—nor

they designed

development

^ire'H^fUf„"p®Vive<T

expected

to;;, end

soon... the current strength of total conmany
structioh activity as well as in the

Profit

margins in a great
are being squeezed
con^ defense program, which also
spicuously, and the pressures; of argues against the probability of
dr0P"
:

industries

Costs, and keen price Competition-,
further depressing profit^.;;

presage

Statements-in

the

new

expan^

being cutback'-icapacity-coritinues to grow sub'stup-,.
tially as the result of,.,prqjepts
a ready m progress
;IW;.gqntK.to-.
stances,
costs
and ^ competition
may spur capital outlays d.esignedprograms

ftn
vvill
the

S-

riskpf

some

ten GX~
vntt ^n'v
9™^™ J^pe■ wiini tne vast an ay
hrt

in the next fifteen years. I might
nnint

downturn carrying further
reasonably be anticipated

nnf

fhit5

fh_f

rhar^hG

ftf

'/hp

ar^ given moment; there is no
reliable
tway do gauge the

-L

•

course

igvejitory.liquKlation, the

mar-

vprv

„p

JuxSor

rl~

will

'^"hin

mir

he
na

It-obviously
ibl

thp

can

it^seems likely, , that;dotal-- Huences,acting upon business iq-.
vestoent programs. Nor would it
continue
downward^ through
,

end

.recommendations ot

:>^>oul>ts Depression Leve1xvten mem^rs

than

would

bea^dydee te deiiy that the

thei^n^nteear^and/vop^today

impos-

seems

econ-

sues

outline all the is-

po„Jies

an{1

discussed by the

t/onsumerr i_-annoi

Tin

4in„.

are

to publish them as each

gTompieted,PL

was

done for the

Report -oft International

vulner-However

would

jjo, it Aione

Furthermore, X fear

there

waiting to be filled. Nevertheless, speculations
the

odds

against a spiralling
decline to depression levels.
are

little immediate prospect-foi* a-re-i' •' ^ -•
of economic activity from
-uSees Halt This
the side of the consumers Outlays ;
nondurable goods and on serv-

ices
This

should

hold

will provide

Weighing
therefore, it

the

seems

lear

Security,
to

take'a

reasonable

fairly well., assume, that the decline in ecoimportant sup- nomic activity will come to a halt

likely to spark

haps-.not in the months

the

sometime this year,

For

amazipgiy iarge share of the demands

Qurs

that

seem

lie

ahead,

has

always been a growth
economy#
Our institutions have
encouraged
individual initiative
and enterprise and have provided
|jie jncentives to

long|erm growth of our production. In
the period from the 1880's to 1930,
our production grew at an average

annual rate
in

support

about 3%. I

the

postwar

told

period,

seems

"free good."

that these gen¬

eral conclusions offer great hope.

They
fact

emphasize, to be sure, the
we
face complex and

that

difficult issues.
our

affairs

foresight,
deal with

ahead

Yet if

with

UpWard

trend

some

issues and

situation

and very great material

move

peace

prosperity.

per

Economic growth is not automatie, nor does it follow an even
path,

the current period indi¬

cates.

have

ing

affairs

our

much

about the problems

learn

arrang¬

encourage

growth and avoid the pitfalls of
both inflation and recession.
I,

tor one, believe that in recent
years

have been making

en-

'couraging progress in this regard,
although quite obviously we are
far from reaching our objectives,
we

manage

can

keen

moving ahead

economy

general growth trend,

upturn in busi-

volatile

in-

ately ahead.

although

per-

immedi-

As to the next

ques-

can,

our

along

a
I believe

should

much

value

achieve

an average

a year between now and 1965,
will have an annual increment
of about $20 billion of new pro-

This would enable
our

capital

evidence

bottoming

our

to increase

national security expenditures

clear-cut

-When there is evidence that

growth rate of

4%
we

duction
to
apply
against
growing requirements.

js approaching the
end of the downtrend, an apprai-

growth,

sal of the recuperative forces then

health
our

year,

education,

remarkable

maintain

meet

each

investment,

welfare.
that if

billion

and
fact

economic

will be able to afford

these

requirements

and

in prospect is likely to be more still keep private living standards
informed, more meaningful, and rising.
To be sure, we would
perhaps more enlightening than need to forego any major reducthe sheer guesswork that any such tions in the burden of Federal

attempt would

now

represent.

taxes,

and

some

moderate

in¬

...like 800,000 Americans who
have

been

and

have the ability to

these

into

we manage

prudence

year

until the current decline has given

are

economy

probabilities,

port to the economy, but it is not
ness.

classical example of a

major impression that
gained is that our economy
lhe
potential ' to
meet
an

about $3
and to spend

out.

vival

has

A second
_

preplraUon

j have

possibly into 1959. Abqth^busi-ab%-tbE^the; forces of contraction Rttle time to present certain ideas
ness investment boom-compamble
thaii was the case in the previous
to that of 1956-57 is not in sight two
postwar
recessions,
when tion—when business will resume
for several 3Tears to come.
many deferred demands were still its
advance—I
doubt
whether
i

mate¬

raw

For

be able to
ke^for homel and passenger cars, several Panels. Moreover, the Re- accommodate those economic,
the effects of: Government action,
por^s are approaching the final social and military needs which
effraenefebut,on; bal-.or ; the, many contradictory in-. ^te-of
and present will be most
pressing.
If we

to improve
ance

months:-ahead.!,,.^Obviously, there is always

Moreover-even with
sion

Growth

example, one of our serious
problems concerns the availability
of water which was always the

that

in
the
economy -isj dbwhturn;^but they may be ex-'
"eej} consmermg our needs m
likely to be somewhat longer and. pected to reduce the chances of sucp^ areas as urban rehabilitation,
deeper than either in 1948-49 or-;, cumulative ' pressures which led
1953-54.
One reason'us. that;the to. spiralling declines on some prethe came time
this Panel lias
current decline in business spend-.-vious occasions.
Finally, there is f* L
f
h
^
fu
t
J .
{
ing on plant and equipment cab- undeniable evidence of support in Deen slnciying tne cost oi lmpiebe

Economic

downtrend

not

Continued

Th.e
!iei ?.n1
1C
have bettered that growth rate.
business aormc and Social Objectives has Total production has followed an

to prevent—

supplies of

rials and fuels at reasonable cost.

•:

inany

and it would be wise to conclude

adequate

how to avoid inflation.

;

differing prddjcI tias^ made.-, use of all three
Now, let us turn from the puretions regarding the, length-ofdhe
of credit policy ly military Report to other areas
downtrend., the levels to: whichiit- *7rbpeuvmarketioperations,- the dis-; under consideration by the Special
may carry, and the thrtihg^fc recount rate.^md changes in reserve Studies project. For example
the
covery.
'-«■'
•*.',
requirements—to reduce the cost Panel on Foreign Economic Polare

cured of cancer

because they went to their doc¬
tors in time. To find out how to

guard yourself against

cancer,

write to "Cancer" in

care

your local Post Office.

AMERICAN
CANCER

SOCIETY*

The Commercial and Financial Chronicle

(1130)

Continued from

contains many natural elements of
attraction
once ' the
public be¬

first page

fully aware of its ad¬
black-and-white.
potential in this area is cer¬
tainly suggested by RCA's more
than $100 million investment and
the fact that, only recently, there
comes

Overall Economic Strength
Of the Television Industry
And, believe me, there is
depth in the tele¬

depth.

considerable

picture, if one takes the
time to dig into it, and if one lifts
one's
from the immediate
eyes
statistics and directs them at the
more distant horizon.
vision

Let's examine the record of the

ing now 523 broadcasting stations,
which

325

equipped for
color telecasting. During the dec¬
ade

are

television existence,

contributed

stations

mately

these

billion

approxi¬
the nation's

product, which is the
the country's productive

gross
of

service

effort.

broadcasting

1957,

revenues

sum

and

television
reached a

vantages

indication

that

other

were

accel¬
token

major manufacturers

erating their up to now
participation in color TV.
Mural

which

television,
than

screen

status

all-past-and-no-future.

The television giant may have
come

be¬

somewhat muscle-bound

the accelerated process

ditures for installation and service

have

ing adolescence, which is his stat¬
ure
today, but he certainly has
not
been
so
weakened
by
a

reached

lion,

since 1950

j;o warrant his be¬

serious eco¬
nomic
contender, either within
the broader electronics picture or
in the even larger industrial race.
scratched

ing

What

hath

television

wrought

(to paraphrase an historical utter¬
ance) in the past 10 years, which
comprises virtually all the life it
has had up to now?
Let's

put together the
television and try
to come up with a composite pic¬
ture of what, to me, is no more
than
a
slumbering giant—cer¬
tainly not a debilitated one.
try

been

several parts of

trend

and

continuous

19 5 7
$2.4 bil¬
times the

record total of

nearly

three

picture
frame
hanging from the wall, is not far
off.
Experimental models have
a

These

three

elements

entertainment phase

have,

therefore,

home:

mental

the

aggregate of about $26.5 billion to
the national economy in about a

decade, of which about $5 billion
represented the 1957 contribution.
For the

near-term, one may rea¬
sonably expect that the level of
operations in entertainment tele¬

but

it is

these

America's

cars

one

analyst*

of fee

"industry."

At the top of the list is

televi¬

contrast, only 51 companies
were responsible for the output of
million

sion set manufacturing, which has

6.4

produced

almost 60 million sets
and poured more than $11.5 bil¬

billion at the factory door, in 1957.

lion

into

the

economic

stream

during the past decade. At the end
of 1957, there were an estimated
47

million

television

which

45.6

sets

in use,

sets,

worth about $1

Obvibusly, the smaller number
manufacturers today are in a
better
position
than
were
the
larger group in 1950, even though
output

lower

level

sure

that

one

the

that
will
capture the
imagination of the public and
crbate a strong demand for such
service.

When that happens,

the

public will get what it wants and
there will be
vide the

and

mad rush to pro¬
service both by present
a

classroom.

with

receiver

The

for
time

one

Just

Beginning

perhaps

outside

segment of what

term industrial

distin¬

guished from entertainment TV.
In industry and commerce, the
scope of closed-circuit use knows
no limit and its growth is barely
beginning today.
The industrial

and

commercial

field appears to have the greatest

million

were

sales

are

than just
I

and

that the
is

passing.

have not attempted to go into

greater detail on either of the two
broad, segments of

space

It must be admitted

enterprise strongly

buttressed in addition by research

development programs which,
though heavily oriented at the
moment
toward military needs,
nevertheless

are

the

breeding

places for the exciting promises
of the non-military future.
Television manufacturing

is by
large in good sound hands,
and the marginal producers have
been pretty well weeded out by
the competitive situation existing
during the last two years at least.
If the economic up-turn develops,
as it has been anticipated in many
quarters, certainly there is little
and

permit
and

operations, or to slow the
being made in industrial
In the light of this, and even
if we ignore what has happened
in
the
past
in television,
the
promising future and the present
ing

progress

TV.

overall

operations which

are

either

not possible or not as effective in
any

other

installations

manner.

Closed-circuit

economic

industry is
reason. to

take

more
reopen

strength of the
than sufficient
the book and

second look.

Ilk Y. Stock

Exchange
Honors E. C. Gray

Edward

Gray,

Vice-President

Executive

the

New

York

multiplying
daily
in
steel
mills,
chemical
plants, metal refining and petro¬
leum processing, where monitor¬
ing of operations is made possible
and

effective

are

under

conditions

which otherwise would be impos¬
sible or at least extremely haz¬
ardous.

Closed-circuit TV has been ap¬
•

plied to
railroading, with the
largest such system now installed
at
the
Pennsylvania Railroad's
terminal in New York City to
serve

its ticket sales and reserva¬

tions facilities.

The medium will

be found in use in

hospital oper¬
ating rooms, in laboratories, and
only recently General Electric an¬
nounced that it had developed a
closed-circuit,
three-dimension al
color TV system for remote serv¬
icing of reactors.
Serving
as
an
extension of
human sight, closed-circuit tele¬
vision will expand greatly during

proponents and also by current
bringing in about 29% .antagonists. And when that
hap¬
41.8 million homes and 1.4 million less money. In the
manufacturing pens,
entertainment
television
in public places.
phase, therefore, television is and its constituent
companies will
The American home ceased to
leading from economic strength in undoubtedly benefit.
be a one-set home sometime ago
1957, rather than from frenzied
as the attraction of television for
enthusiasm which brought about
Educational and Industrial
different members of the family the fastest penetration of a mass
Television
the| coming years, said Dr. Vladi¬
virtually forced a doubling and, market by any product in indus¬
There is not as much to be said mir K. Zworykin, television sci¬
to a much lesser extent, even a trial history.
for
industrial, or closed-circuit, entist and honorary Vice-Presi¬
tripling of TV home facilities to
television, for the scope of this dent of RCA, a year or so ago. Dr.
Lid
May Blow Off
satisfy the varying and often con¬
phase of the field is not nearly as Zworykin told a group of stu¬
At the present moment, enter¬
flicting
family
viewing
tastes.
dents:
defined as is the case with enter¬
This situation gave a strong im¬ tainment television
may
be tainment television. Still, tremen¬
"Apart from the many uses of
petus to the demand for portable likened to an oil well which has dous strides have been
made, al¬ closed-circuit television in educa¬
TV sets, which now account for been
capped to hold back its though the economics of this
pic¬ tion, industry and research, we
about 29% of production. In many super-charged treasure of black
ture are not as impressive. Ac¬ can envisage it in many
other
cases, older sets were retained to gold. Any one of several develop¬
cording
to
the
well-informed fields, such as an aid to the house¬
serve
the
individual
family's ments may blow the lid off tomor¬ "Television
Digest,"
industrial wife, giving her visual
access
second-set requirement, thereby row, or the next
day, or the next television
equipment
sales fr'om the living room to the kit¬
adding another factor to the fu¬ year—no one really knows when. amounted to
$5.5 million ih 1957, chen, nursery, play area and en¬
ture
replacement market. It is
Color
television
is
largely a 'or double the 1956 figure. Esti¬ trance way; and to the farmer,
estimated that there are 3.8 mil¬ matter of
price today. Output in mated for 1958 is a total of $10
providing over-all views of the
lion second sets in the homes to¬ 1957 is estimated at about
1
200,000 million.
stables, yards and out-buildings.
day, but no figures are available sets, an increase of 50,000 over the
The greatest immediate growth Your
generation may well witness
on third sets.
1956 production, but retail sales lies in the area
of educational
an
expansion in this, field which
To serve these 47 million TV have been
anything but satisfac¬ closed-circuit
TV.
Some
200
sets in use today is the second tory.
exceeds the phenomenal growth
However,, over the long run
"TV—The Second Decade," by Irving'
element in the entertainment tele¬ it is not hard to foresee real
which we have experienced in
vision picture. There are operat¬ growth in this medium since it Kahn, in *'The Analysts Journal," Feb¬
broadcast television."
ruary, 1958.

for business

groups, indicating
demand for such service

closed-circuit systems
observation of processes

potential

the

medium

and

in the other

re¬

proponents of pay TV will come
up with a demonstration of this

The

instruct several

limit to the eventual applications
of television to education, but not

TV are

telecasts

other

to cast a-shadow over broadcast¬

homes have television now), new impressive. Thus, if only 10% of
television, which
all set owners pay $5 monthly,
family formation, the growing de¬
portion, breaks
this fractional fee income equals
mand for second and third sets,
down into three elements each of
and
the normal
replacement of $240 million. This is almost onewhich contributes to the portrait
fourth
of all
income currently
old sets, an annual sales level of
we
are
seeking. In this is tele¬
Sec¬
6-7 million sets should be about paid by all TV advertisers.
vision set manufacturing, televi¬
minimum. Prices should run at ond sets permitting a choice at the
sion broadcasting, and television
same
hour,
public
place
sets,
installation and service. Industrial pretty much the current level.
theatre projected events, would all
There is, however, an important
television, which holds forth a
be added to such home fee TV in¬
difference in the situation as it
tremendous potential for the fu¬
come."
ture, is the second major division exists today and as it existed in,
Whether pay TV, in whatever
say,
1950
when
television
set
and it breaks up into two parts:
form, ever comes will depend
closed-circuit television in indus¬ manufacturers cut up a pie valued
much more on the public's dispo¬
try and closed-circuit television at almost $1.4 billion, the peak in
sition than on the outcome of the
in education and related applica¬ the industry's brief history.
At
that earlier date, there were 140 current tug of war between the
tions.
two warring elements in this pic¬
We have then, really, five parts firms involved in the production
ture.

can

simultaneously

camera

Growth

Entertainment

of about 7.5 million TV receivers.

teacher

There

is the most heralded

to what I shall term the television

hired and paid

are

by local taxing groups.

faculty."

Pay T-V
economics

circuit

Most teachers

adding a new teacher.
nearby prospect of a
quick growth in teachers,
TV
teaching should grow. It is also a
way to use the most experienced
and
effective
members
of
the

cently put it:

"The

There

companies which offer
their services in arranging closed-

and

With

than 60

cities.

125

are

that

cost

auto

mathematics of the medium
which merits more objective con¬
sideration.

cost, installed, of their equipment
is usually less than the annual

cars,

obscured

Certainly

it is
heed

about

reached

lion in 1957.

each

sets

Finally, there is the as yet unimpact on television
may
come from
pay-asyou-see TV.
This is a very con¬
troversial subject and in the pros
been

go,

broadcast in this manner and these

of teachers is
too well accepted to require proof.

one

in the future.

has

educational

will

shortage

classrooms

measurable

cons

far
TV

small in economic
entertainment
television, closed-circuit TV has
already produced an off-shoot in¬
dustry of modest but rather im¬
pressive proportions. It is esti¬
mated that in 1957 approximately
$2.75 million was paid out in
service fees to firms specializing
in the handling of closed-circuit
business and other meetings. As
near as can be determined, there
were
sightly
over
30
events

said:

same

the realm of

eventually

that

how

Even though

stature compared to

television since
does not permit. Television
is an "industry" with an invested
capital ranging well above $1 bil¬

for

limited

expensive

state-wide basis.

"The

the 1958
experi¬

on a

educational

Thursday, March 13, 1958

capabilities of America's shortsupply of teachers and this medi¬
um appears to be the most satis¬
factory and most immediate an¬
swer.
As Mr. Kahn, whose article
on television has been noted
here,

which

and

American

not out of

million

very

first

sys¬

exists to utilize to the fullest the

TV could become standard equip¬
ment

possibly a little higher in
1958 if the anticipated upturn in
the general business picture fore¬
stalls any material reduction in
corporate TV advertising outlays.
Adding up the factors of satura¬

year,

84%

models

form.

possibility

vision will be close to that of last

(about

shown in

been

Oldsmobile

hard to estimate.

automobile TV, which has

already

100

single system to

closed-circuit

the

outside

are

regular

being readied for the Sep¬

Just,

another tre¬

market

basis, for the

of television

contributed

This would open

mendous

additional

The largest

extend

been demonstrated and this would

will become available

Stronger Set Manufacturers

tion

Describes Television Industry

level of only seven years ago.

smoothing and relaxing of his sin¬
ews

also

in. ascending\

of reach¬

expen¬

and

tember,
1958, school year in
Washington County, Md., and will
cover 18,000 pupils in 48 schools.
Other systems are now in opera¬
tion in Atlanta, Cincinnati, De¬
troit, Miami, Norfolk, Oklahoma
City, Philadelphia and Wichita.
According to one report, Alabama,
Nebraska and Oklahoma plan to

working condition. These

basis

date is

which, however remarkable
naturally lead to a consideration
magnitude, paradoxically
is record high of $1.3 billion, con¬ that in the future television
being transferred, like a flimsy tinuing an uninterrupted climb screens
would
also
be
larger,
since
1946
when such revenues
decalcomania,
on
a
canvas
of
bringing clearly-defined, lifeamounted to only $500,000.
seeming instability, poor economic
sized pictures to the viewer.
The third element in entertain¬
texture, and, apparently, limited
Concurrently with other devel¬
scope,
I say^ paradoxically be¬ ment television is installation and
opments
will surely corpe, the
cause the record of the economic
repair. During the period we have
fully-transistorized television set,
power, which television exhibited been considering, the American not
only portable, but drawing
and generated since it burst on public has spent about $10 billion
limitless power from solar cells
the American scene after World in order to intsall and thereafter
which would bring the energy of
War II, merits more than
exile maintain its television sets in
the sun to chargeable batteries.
into
statistical
limbo
and
the
past

using

1958.

system

utilize

would

thicker

presently

tems are slated for installation in

over

The

was

sound appraisal in

substitute for

schools and other institutions

Edward C. Gray

Stock
from

Exchange, received tribute
the

Board

Governors

his 40th Anniversary with the Ex¬

change. He joined the staff of the
Exchange in March, 1918.

Allen
Allen

Northey Jones

Northey Jones, partner in

investment

the

banking

firm

Morgan Stanley & Co., died March
9
at
the
Peter
Bent
Brigham

Hospital in Boston, Mass. after

short illness.
In
was

September, 1935,
one

and associates

group

Mr. Jones
of partners
Morgan &

of J. P.

Co. and Drexel & Co. who formed

the firm of Morgan Stanley & Co.

Incorporated.

was

President of that firm

until

Vice1941

and was a partner of Morgan
Stanley & Co. from 1941 to the
present time.

W. R, Hogsett Opens
ST. PETERSBURG, Fla.—W.

Hogsett is engaging in

securities

business from offices at 1216 Jack¬
son

Street, North.

Volume 187

Number 5724

...

The Commercial and Financial Chronicle

(1181)

Continued jrom page 15

Electronic Tape Control
I would like

pressure

information

the

pilot.
versatile

little

hooked

in pairs, in series, or in
kinds
of
combinations,
are
found by the hundreds in the new
high-performance airplanes — at
all

least

350

They

are

modern

bomber,

used not only in the instrument systems but in all of the
other
other

tool

automatic
automatic

svstpms

snph

systems, such

XIJK
pressurizing,
and

others.

numerous

The

synchro

principle further permits an elec¬
trical signal to tell some piece of
power

equipment to go into action

raise

the

wing flaps,
trols.

landing gear, lower
the rudder con-

move

The

equipment,

power

this case, is called

anism,

servo-mech¬

term that has

come

to be

tion

examth„ air
air" is
the

the Air Force's Convair

bomber

called

the

B-58

new

Hustler.

This

airplane is so fast that it would be
impossible for man to fly without
a

control

system that "thinks for
the pilot."
The range of aerodynamic forces
encountered
by
4

„

induce
degree

tuators

sneed

is needed to
a

of 1

its
ac-

mechanisms "

the control surfaces

move

quire 6,000 times

more power

move

Bendix

automa-

for

Martin

Air Force

con-

+rordc

50-ton, three-axis mill-

eauinment

that

elee—

virtuallv

fr™

makes

•

pi inis*
The tine-controlled

orncecc

xirac

;i? .lel?I0C,e.ss ^as
first used in mass production by
T

Bendix to solve

bottleneck in

the

first

place,

automation

Industrial

developments produce the necessary equipment.

embodying precision, reliability
and hydraulics are today being
aPPbed to such wonderful equipTnt asJl2e ^a,rt pump* Those

But

Will benefit from similar
applica-

these

*4ons in business> and 1 wil1

occur only as fast as business firma
can raise the
capital needed to devise and build or rmrrha^ th^se

tion such
0

over'

indust?v

oictu

Problems Limiting
One

men-

possibility later.

annbVabnn

that

electronic

nninmatinn

has

and

ln
m thX
this

ultrasonic

re-

than

the controls of

modern airliner.

^gieal
f

one

"™ster cam" was. previously

one"man l°b requiring from 10 to

14 weeks of highly skilled work,
With the tape-control process, that
°Peration can now be completed
in from two to four days.
In the tape-control process, an
engineer puts down on a process

instruments

Automation

most

capital.

ventive

important

Automation

eenius
genius,

our

can

in¬

our

the
tne

markets

pressure of

the growth of

and

Thus
inus,

securitv

our

creasing

health
neairn
the

in-

taxation? and

personal savings

will all play a major
part in such

apparatus.

the

fantastic develonments of

alreadv

field
Held

cam

^>u

while these industries may
expand very rapidly, there are
other factors affecting the change-

phases of hospital operation asso—
ciated with communication, accounting and records of all kinds

Jh.e manufacture of a small, that
m- Jouched thT hisnhal
tricate three-dimension
me nospitai

mav

hvdraulic
-

e
°fU metering
nT
svstenf
gton
the new
e
uitrasontrLatongequipTT

fc?8/10

because

the

"servo

example

Aircraft under
is

control.

tape control.

dJ.°fhT
fnianeem nrod
this instance,
production n?of £

maneuver

Moreover

extreme

that

given

from 20 degrees

vary

operations

your

bit

ins machine with associated

exciting

e*
nf
i„
pies
of
^automation'in

tovdescribe in

one

new

built

tract

inch.)

One of the most

as\s;em1Ce^?L0rcontrol Tfr J"?" SUCh *5"* to?

SSiiSto
conditioning and

This

...

devices,

detail

control,

parts—with most tolerances held
to .0001 of

These

affected

and equipment but certainly we can occur only as fast as man can
of the latest forms see
electronics
being widely dream and devise the process and
of machine
automation utilizing adapted to marvelous new equip- the
machinery, and existing or
what is called electronic numerical ment for
diagnosis, treatment and new industries can design and
more

Automation: Key to a More
Productive Economy
oil

already

We became interested in the
advantages of using ultrasonics, or

mistrial progress,

coir}ponents. Our system of ultrasamp cleaning operates with an

aigest investment

The industries which have mado
high-frequency sound waves, in the most progress toward continuBendix to meet the problem of ous operation in the past are the
cleaning precision-built aviation very industries which have the

Leaders

per worker.

are petroleum and coal

sbeet the dimensions of the part el®c.tronic generator that converts with $105,000 and $28,000 asseta
associated with a broad area of
gins in its long^ needle^ike no?e t0 be made, as determined torn
60-cycle electrical power per employee, respectively. Near
automation.
\vhere sensing units
up at- the blueprint.
These figures are
Of course there are many auto¬
Ihis current' is ished
^ b°tt0m
aPPal'el and
fabric "*
mospheric
data.
The
products with assets
computer then ^Ped on a special typewriter &d t®pei secona- ims
11 hrl
TTl
fViol rvunrliinrv?
matic
ACLl
t*J
The Hustler's control svstem be-

p?ck

_•

and

turing
sophisticated
have just

described.

But I think

ccnter

of
gravity, altitude, and PrelimJnary
tape is then fed
temperature, and translates them through a special electronic cominto control commands.
A 267- Puter to produce the actual conhow was evolved that now applies
pound device called the Power trol tape
which represents the
to
many
automation techniques Control
'Linkage Assembly per- actual piece to be made. The finand devices.
mits the pilot's easy control-stick ished control tape is then P*ayed

the point that in meeting
of aviation, know-

you see

the

problems

1 A
is

new jet airplane, for instance, motions to. be translated into a^rofast'that
have to have

you

•completely

automatic' system

to
ratios

measure, or meter, precise
of fuel and air to the engine or it
will "flame out" or stall. So you

have

system that automatically

senses

the speed of the inrushing

air, its density, temperature, humidity and several other factors,
and instantly computes and supplies the proper ratio of fuel to
make the

engine operate at maxi-

efficiency. All of this is happening so fast that it would be
mum

dynamic

control-surface

motions

nitnn+l?1

into nhvsical

**
'

intPoduced

■

dpterJent

enerev1 This knotty question. It is no different,
aiiouid boweveF> from such problems ot

into

human

sound

waves

ia,own

the past' but somehow, the
chips

be;oncl
hearin"

through

pass

Wes ol machines, to piocluce the

are blS'^er- We must also ask our~

that vibrates with

'
f

and actuates the special controls »

that conform properly with all of
the critical air-environment and
flight attitude factors I have just
mentioned. Without this automatic

"
.

"cavitation."

selves not just whether we can
affai'd. it:' but can we afford not to
do it m the face of today's severe

thp

the

competition

effect

Tiny voids

and

increasing labor

costs.

To assist in this evaluation

many

industries

are
establishing
Qr vacuu)ns
are
cleate(j that imPie<-e itself—one oi many.
separate application study groups,
plode
or
collapse,
effecting
a
The three-axis cutting motions
and this approach may appeal to
microscopic scrubbing action that
system, the slightest "over-con- of the machine are continuously
uniformly reaches every crevice, some
y°u with your particular
trol" by the pilot might tear the monitored by feed-back controls
every blind hole, every surface of Problemsplane to pieces.
capable of detecting a motion of the
part to be cleaned. In indusAnother key consideration in
Guided missiles, of course,
oper- as little as two ten-thousandths of b.y> iapping compounds and cut- progress toward automation is the
ate as
a
result
of
sensing and an inch. "Feed-back," a word you ting oils that resisted vapor de- tremendous demand it creates for
actuating devices for their elec- will be hearing with increasing greasing and cleaning with sol- skilled manpower. The new
equiptronic and hydraulic "packages" frequency, is part of a closed loop vents
have
yielded
readily
to ment cannot be designed or built

that

guide them to their targets, system in an automated device "cavitation" or "cold boiling." To- until there are sufficient trained
Missiles also involve a specialized that brin8s back information about
day such cleaning equipment is people to accomplish this first step
impossible for the human pilot to form of electronic communication lhe condition to be controlled for
bejng wjdely used for precision —and no business is going to make
"run it," even if he had nothing that
is called telemetering which comparison with the desired specparts 0f all kinds, glass, mirrors, an expensive change in equipment
else to do.
Here is a case where i
wm mention later.
ifications, or target value.
and even complete generator as- or methods without first making
electronics and hydraulics not only
These are just a few of the reaMartin is using this newest ex- semblies, radio chassis and entire sure that the trained manpower is
does a better job, but does a job
b
aviation has made the ample of heavy-industry automa- jet engines.
In many cases it is available and their skills upgraded
that otherwise could not be acbroadest uses of
the
tion in making parts for the being built into automated proc- as required.
complished at all.
processes that are automation in TM-61
Matador
tactical
missile,
essing
lines.
However, of all the factors that
Let me cite another example of
themselves
Today's
aviation
is with qu.ite remarkable savings in
Following the successful appli- will determine the speed and di«
"airborne automation," a Bendix
proving to be a development production "leadtime" and tooling nation of ultrasonic cleaning to rection of automation, one of the
development called the Central
souree for
many such techniques costs. Twenty-two additional mill- industrial
application
Air Data
problems, most important is What people
Computer that coordiwhich
subsequently
will
have ing machines employing this Ben - an ultrasonic unit specially de- think about it.
nates a supersonic aircraft s whole
great industrial and scientific ap- dix tape-control system were re- signed for cleaning
surgical in"nervous system"-receiving and
"Wholehearted
acceptance" of
plications.
cently ordered by the Air Force.
struments
was
developed
and automation is most common among

Electronic

-■r

.•

f»

matron" nece^isarv^for supersonic
fiicht
The Xir^rre has-dered

$7?500',000
the

for

worth

of these

devices

M* WVVUU\^»3

Time does "ot Permit .a detailed
review of the

many ways automa-

has bee». applied to machine

handling and tianstei

computer equipment
actually does is to make certain
Most of you have probably seen
basic
measurements
of
the
air one of automation
most interestair

through which the plane is flying, ing accomplishments — the autocorrect
these for
errors
in
the matic bowling pin setter. It uses
sensing units that are caused by a large number of automatic prinhigh-speed flight, convert them tuples, including conveyor, transthrough computation into required fGr,
distribution, switching and
nformation, and then distribute electric eye control.
the

information

matic

systems

all

the

auto-

airplane,

These systems include flight con-

trol, fure control, engine control,
bombing and navigation, reconnaissance, and air conditioning.
An airplane flying at supersonic
speeds develops some terrific pressures and temperatures around
it,

and

the job

the

air

data

computer to sense these and convert its findings into control information.

W?ha."£n® IKSt'lS marketed in cooperation with the
?n a tape-contioiled machine tool American

ehangiPg ito taPe
need'to

Republic F-105-and Mc-

Donn,e.JH-.^-1B
?uPei?onlc
fl«htWhat this
data

ers.

tity

anSWer

miVht

add that this dpvire has

s^chrosf

Jast

it— which

you

year>

can

Experience

^ tape for

stored

to say it is ab-

indefi-

the

hospitals General
1 Electric, testified
'
at hear¬
ings held by the American Con¬

ultrasonic cleaning unit
shows that one load of 100 instru-

gress to explore automation and
nitely_need only be pulled out of ments can be completely proctechnological changes t hat the
the file<
If you want to change
essed every three minutes.
This United States will require an es¬
the design at some point, you can
compares with approximately 60 timated 40% more
goods and servspiice jn a new section of tape minutes required for hand wash- ices
by 1965 though it will have
covering the change. In the event ing.

national emergency, duplicate

only 14%

people in the labor

typical example would be a force
Industry must be encourwith four operating rooms
he
invest in more
I am sure one of your first views
over
the country to plants that
which might average at least 60
productive machinery and methof automation was the
cigarette- have similar tape-controlled mansurgical cases per week, or 3,000 Gds. Faster progress in the newer
making machine in a New York ufacturing processes.
in 50 weeks. With the normal kit field of automation seems to us
window.
Today these machines
To look beyond the defense innow containing up to 120 instruto be the only available solution
make, package and carton 150 dustries, I think it is apparent
ments, the hospital might be re- to this program, Mr. Cordiner said,
packs per minute. Even the sim- that this process will have numerquired to clean over 300,000 in- particularly in situations where
pie pretzel has gone automation, ous
other
applications.
In big struments per year. Present meth- we have exhausted the known ecoand we have a machine that
pulls, manufacturing operations, such as ods indicate that 30 seconds is a
nomic
possibilities in the more
forms, twists the dough, bakes the the automobile plant, the tapepractical minimum for inspection familiar field of simple mechanipretzel and packages them — 50 controlled
process, or numerically hand-scrubbing and re-inspection zation.
packages per minute. And the controlled milling, could produce for
each instrument, so that 2,500
Labor's Viewpoint
toothpaste you use so frequently the dies for a major model changehours of tedious, constant hand
Wuprp
or^aniVed
labor
depends entirely on an automatic over in about one-fourth the time
labor are required.
b
stand in this all-important matter
process
that fills, cleans, folds, now required. In small- or metapes

can

made

and

turn 0ut
bours-

3'000

Tbe plant

en«ines
covers

600,000

sent

all

Flectronics in Hosnitals
y

„

hotpital

The

makes

a°ged;

may

have

cleaner

ultrasonic

possible

clean

sairto

now

of public attitudes toward auto¬
the mation?
George Meany, President

year's, say 300,000, instruments
from four operating rooms in only
150

hours.

Ultrasonic
cleaning
also have been extended to syringes,
processing
them at the rate of 1,600 per hour,

^tthud^Vm^^lose6 to

fkboiehearteH

techniques

t0.SUch ,tWngS 33 tuMng a"d
laboratory glassware.

oTeraS^o \Tow poITup rem?

511 gears, 820 ball square feet and cost approximateninr
lxr OSO OAO non
bearings and a total of 2,781 major
]y $50,000,000.
just how far automation

far

go so

"you Stais6 "^ndudfn^PassTvTt SS IS""110 attainment of
H?sp«al here to ChSfago
"taTph S^jtaer, President of
made ,ast

The fire control system
needs, for example, instantaneous
computations of air density multi- closes and packages at the rate of
dium-size
industries,
the
tapeplied by the speed of sound. From 150 a minute.
controlled machine tool offers the
its
own
basic
measurements
of
A good example of what has
prospect that small lots of parts—
temperature a n d pressure, the been called "Detroit automation"
say a few hundred—can be made
computer accurately calculates air is the Chrysler Qualimatic
engine economically because intricate and
density and the speed of sound, plant. It has hundreds of machines
expensive tooling is no longer remultiplies these two figures and operating almost as one and can
quired.

V?tem

~o f management",

representatives

Company. Many

Then K
make'antodditkmal quan-

°f something

month

Sterilizer

automation.

to toe

^to

accentance

wa<,

ouoted

!"itPhatomie

ihe livesTaflTf

sees

—

of auto-

reason

saving

"automation

couDled

wll

us" and
fear

change

"labSr

the

time

be ™
Continued

page

The Commercial and Financial Chronicle

(1182)

Continued jrom page

new

that there will still
of work to be done by
people and "if it becomes possible
to put into effect a shorter work
week to maintain full employment,
let us promptly accept this oppor¬

tained.

cance

will

wire rather than py

discussion

limited

devote

this tremendous

radio, but the same result is ob¬

while

development.

the

protect the people against

alleged bad side effects of

auto¬

mation.

the view that
so-called bad side effects

not

there are

automation,

nor

does

history

justify them.
Let

Autometrology

behavior

missile in flight, all in say

2 minutes.

ceived

The information is re¬
the ground in the form

of electrical

impulses that can be

logged on charts and then evalu¬
ated.

Now, we have a commercial
application of this same principle
in a system that we call digital
transmission equipment.
It is a
new
system of measuring and
monitoring at a distance that per¬
mits "push-button" operation of
complex industrial processes going
one or even 100 miles away.
It is

applicable in almost any situation
where it is desirable, or geograph¬
to separate a
suman supervisor from the device
or
installation he is supervising.
ically

necessary,

The system can

electric

cells can /'see"..certain
they do not possess
in
the
higher
sense.

but

marks,

Economy

"vision"

think it is clear that the ulti-

These functions

that it is

—

judgment,

the

of feedback

use

for machine control

are

way

ence.
Most assuredly, it is a new* metal and wires and vacuum tubes
guarantee of the continual process: and transistors — let's not forget
of
change that/has marked all that; ally progress is
of human
human
progress.
But the basic origin. The driving force of amchanges .it will
make will not' bition, the unpredictable course of
come
overnight, though the pace man's inventivenes, and his knack

of change may

certainly increase. 0f using his freedom of enterprise
to automation will be to build organizations that prpgradual process governed funda- duce useful things and create inmentally by the marketplace or, corhe-producing jobs — these are
in other words, by economic con-, the
indispensable ingredients of
The switch
a

siderations.

'••*/"

It should be

noted, for instance,

that automation in the office does,

imagine the millions of dol¬

whole

essential

nals

sense

mensions

and detect

off-size di¬

they occur, or
trend, and automatically
place a "stop order" on the ma¬
chinery to halt production until
corrections to the proper size are

detect

as soon as

In the field of autometrol¬

made.

payroll,

hour.

Many

such machines.
here

not

that

mean

shall

the

progress.

What people are

inspired to do,
from
doing, will
really happens to

prevented

control

what

•■

office

say,

will

machine-made

that

unem¬
The primary impact of automa¬
result of computer tion on society will be to create
misconception.
A new opportunities — opportunities
survey shows that in 1940 we had for new skills, for raising stand¬
in this country some five million ards of living, for increasing mili¬
people employed in clerical work. tary strength, for earning a living
Today, the figure is 8 to 10 mil¬ in a more rewarding and-interest-- Atom in the Electric BusinessElectric Companies ^Public In¬
lion.
Clerical work amounted to ing
way,
and opportunities for
formation Program, 2 West 45th
10% of total employment in 1940, setting up profitable business in
while
Street,
New York 38, *N.* Y.
today's
clerical
workers fields that may, be almost un¬
make up 15% of the total working known at present.
* ' /•/;
-.
•
- *
j V" (paper)./
.
force. In fact, the long history of
To
say
that automation will, Better Handwriting—Paul Vl West
the
arithmetic
machine,
from cause labor displacement is by no„
—Barnes
& »Noble,
105 Fifth
abacus to adding machine, cash
means equivalent to saying'that it
Ayenue, New York 3, N. Y.—
register, calculator, and punched will bring about unemployment.
(paper), $1.00.:
!
.
f
V
cards, shows that the faster the There is the classic example, here,
Common Stock Financing—Harold
machine process, the more jobs
of the blacksmiths who were put/

ployment
"brains"

as a

the machines created for the men

are

rail sags one-millionth of an inch.
This business of
urement and

things, on
to

finer

the

precision meas¬
ability to make

production-line basis,
finer

and

tolerances

;

in an business will collect and store
have, more information, analyze it betr
I might point out; ter and act on it faster.

we'll

frequently talking who work the machines.
about very fine measurements or
Electronic computers in several
tolerances, even millionths of an
forms will have their application
inch. To give you an idea of how
to hospital systems of the future.
fine a measurement one millionth
For
instance,
industry
is
now
is, the engineers point out that
working on a plan to accumulate
when a fly lands on a railroad
employees' wages or salaries auto¬
track (just between the ties) the
matically and continuously andf
ogy,

ap-

of increasing pro- long exclusively to human beings,
ductivity—and hence our standard
In
our
concentration
on
this
of living—to a degree which is al- topic
of automation, which emmost impossible for us to imagine phasizes inanimate things — new
in the light of previous experi-Vand; fascinating combinations
of

these

the factory,

processes

of information about the

business cording past events, but they cansignifi- not be built with imagination for
our econ- spotting new possibilities. Photo-

automation will lars saved, plus the time of the en¬ same things .with machines that automation.
"
'
only direct machine op¬ gineers involved, in the applica¬ are now done with human effort. "
erations, but perhaps to an even tion of such a computer to a major The function of the office is to
greater extent such auxiliary op¬ highway program. ■;
collect, store, interpret and report
erations as inspection or quality
information.
With
superior
In the office you may have a on
and assembly.
Automatic meas¬ machine that will prepare the methods for doing these things,
In

that, I be¬ to an efficient automatic process
lieve, bear on this discussion and —it's called autometrology. Autohelp to put this very broad subject metrology deals with highly sen¬
into focus.
sitive gauging and measurement
systems that "think," record, and
Telemetering Potentialities
control
piece sizes through all
In the operation of guided mis¬
stages of manufacture, assembly
siles, we have been using for some and inspection. Automatic, splittime a process known as teleme¬
second signals from the gauging
tering. This involves the simul¬ and
measuring instruments are
taneous coding, transmission and
flashed back to machine tools pro¬
recording of as many as 500 types ducing individual parts. The sig¬
automated

Thursday, March 13, 1958

affect not

urement and

give another example of

can

m^te significance of automation is praisal and imagination—still bc-

large millionelectronic comput-'
achieving fantastic results

are

the

The

be plenty

have

may

Significance To The

in the field of pure science and in
petroleum and chemical in¬ certain special tasks in business
dustries have many operations and industry, it is the smaller or.
that are typical of the continuous- general-purpose computer, priced
flow process
which lends itself below $75,000 that holds the most
readily to automation, and these promise of becoming an everyday
tunity to lighten the burdens of industries have, in fact, pioneered business and industrial tool. As
in the use of many automated de¬ an example, a leading highway en¬
the American people."
vices for control of pipelines, re¬ gineering firm recently announced
Most labor leaders seem to ac¬
development of a system, using a
cept automation, but with some finery processes and the handling
of chemicals where it is desirable general - purpose
computer, that
reservations. They agree that au¬
to avoid coming into direct con¬ cuts highway
survey
and engi¬
tomation is a good development,
tact with them. Thus we see an¬ neering time to one-thirtieth of
but some of them insist that
other important phase of automa¬ what otherwise would be required
planned intervention — either
—it calculates where a road should
tion in its safety possibilities.
through government or through
go for matching cut and fill. You
collective bargaining is necessary
went on to say

terms

omy.

dollar-and-up
ers

practical

the
in

and

electronic "brain" of awesome

But

mission is by

point
man

proportions and capabilities so I

Productive Economy
ally on an automatic basis, with
machines operating machines." He

said about the marvelous

things computers can do and al¬
most every day's newspaper car¬
ries a story or picture about some

Automation: Key to a More

and

ten

We would

be here for

Of Busi¬

W. Stevenson—Buread

automobile.

out of business by the

ness

month if
-

ness

Research, School of BusiAdministration, University

to try to enumerate the
of Michigan, Ann Arbor, Mich,
opportunities for earning a.
(paper), $4.00.*
•
- V
t
'
Jiving that were created by the.
automobile age. There is also the Comparative Job Performance By
case-of the
telephone industry,
Age-^Bulletin 1223—U. S. De¬
which began about
1920 to use
partment of Labor, Bureau Of
automation
in the ,form of dial :: Labor Statistics, 341 .Ninth Ave.,
then to use them for a continuous telephone equipment.
New York 1, N. Y., 45(?.
Since 1920
> •
means of cost recording and con¬
the
operating telephone compa-,.
trol. Suppose each employee has nies have more than doubled their- Connecticut's Manufacturing
'Economy* —
Connecticut
De¬
a
metal
tag on which is key¬ employment. The use of continu¬
velopment
Commission, - State
punched complete information in¬ ous-flow methods in the oil in¬
Office Building, Hartford, Conn,
cluding name, classification, rate, dustry also began about 1920 and
(paper).
address, etc., which when inserted this industry's employment also
we

were

new

operate over exist¬
very much a common denominator
ing communications facilities, such
of technological progress.
When
as telephone and telegraph lines,
James Watt devised his steam en¬
in a time clock automatically re¬ has about doubled.
and over very high frequency mi¬
Current
EconomicComment —
crowave radio bands.
It operates gine, we are told, he succeeded in cords the tag and time clock in¬
With articles on "Wages, Prices,
A real danger is that fears about
on
the digital computing system, fitting the pistons to a tolerance formation in a computer memory
and
the so-called bad side effects of
Employment"; ."Voluntary
of "the thickness of a worn shil¬
measuring or sensing in terms of
system wired from all clocks with automation will slow it dowix by
Credit Restraint Program";
ling," or about one-fortieth of an additional information being piped"
numbers, or coded "commands,"
"Benchmarks of Bank Mergers";
imposing an additional cost upon
inch. Imagine the engine of your
which are translated into action,
in as that employee is assigned to;
"Reconsideration of the Tableau
production. If such burdens offset,
automobile if it were built to such
such as the automatic positioning
various duties and jobs. The com¬
the
Economique";"Federal Agencies
savings from increased/ ef¬
crude tolerances. The automobile
of shafts, off-or-on switching of
puter then calculates, records and
and
the Creation of Gross Na¬
serves
as
a
good example here even prints complete salaries or. ficiency, the incentive for- tech¬
motors, pumps and valves, or
tional Product'/; etc.—Bureau of
nological improvement may bebecause when you think of the
measurements
of temoerature,
wages and costs of thousands of
Economic and Business Re¬
impaired or destroyed.
-; *■ " *
wonderful performance and relia¬
different operations as desired.
pressure or other variables.
search, 205 David Kinley Hall,
The
only connection between
To illustrate how this system bility of today's cars as compared
Urbana, Illinois (paper),' pub¬
with those of, say, 35 years ago,
automation and unemployment is
would
Will Aid Small Business
work
in a
remote
tank
lished quarterly,
(available on
the problem of labor displacement ;
you have to realize that the per¬
gauging system in the petroleum
There
is
some
concern
that
request.
'
•
'
formance you have today would
the need for people to adapt them¬
industry, an operator, connected
these great technological changes
be impossible without very finely
selves to new jobs and new op¬
Directory of National and Inter¬
by a single wire circuit to a tank
will be unfavorable for the con-,
machined parts that fit together
portunities. People will shift from
national Labor Unions in The
farm, would "interrogate" a spe¬
,

„

tinued growth of small business.
and run together with incredible
lines of work in which their serv¬
by dialing its number
History does not so indicate and
smoothness. Achieving these fine
ices
are
no* longerneeded to •r
telephone dial. Instantly
I am not one that shares this con-,
tolerances requires such measure¬
others, often better jobs. There is"
the level or volume reading of that
cern.
Such changes will not only
ment devices as the air gauge,
no
virtue in' keeping" people attank appears in figures before the
create new jobs, but thousands of.
where you test the perfection of
work
making more automobiles*
operator, and he or she then pro¬
new
businesses.
The automation
a part by a method that measures
than are actually needed.
Farm
ceeds to interrogate any or all of
industry itself must produce de¬

cific
on

tank

his

the other tank* in the field to ob¬

how much air under pressure can

tain

get%past the part when

largely

into

sisted

their readings.
Telemetering has had a particu¬
larly important application to hu¬
man behavior in flight.
We have
instrumented many pilots with

equipment

for

automatically

ra¬

a flight control sta¬
happening in flight
pulse, blood pressure,

dioing back to
tion

what
their

temperature and various reactions.

space

of the required

discussing some of the more
exciting developments in the field

Nor

the

will

the

use

exclusive

of automation

domain

pointless if we
keeping three-quarters
population on the farms.
*

Automation will be adopted

large
all
up,

the

by;
small business if, when

eventual

costs

are

totaled

it is actually cheaper and/or
than1 continuing
present

better

methods.

tics,
York

341 Ninth. Avenue,
1, N. Y., 40£. .
•
.

New
/

been* Dominican RebuWie: Annual
Report for the year 1956
had in¬

of our

Bulletin

1957

S. Department of
Labor, Bureau of Labor Statis¬

Secretary of State for
Commerce

industry,

Finance,

Dominican

Trujillo,
(paper).
East-West

Trade

Ciudad

Republic
\

Developments

1956-1957—Internation Coopera¬
tion

Administration

intendent

—

Super¬

Documents, U. S.
Government Printing Office,

the

Will Not Replace Man
Washington, D. C. (paper).
•
big corporations. It will be
eouipment has already been ap¬ have not yet mentioned the com¬
One final word on this myth
adopted,
whether
by large
or.
Employment for Women as Secre¬
plied to hospital operative require¬ puter as a tool in itself or the small business, if—when all the that automation somehow puts
taries, Typists,
Stenographers,
ments in many locations whereby extension of automation bv com¬ eventual costs are totaled
up—it machines into competition with
other clericals
U. S. Depart¬
an automatic
recording anoaratus puters to one of its most promis¬ is actually
cheaper and/or better men: No machine, however auto¬
ment of Labor, 341 Ninth Ave.,
located in or adjacent to the oper¬ ing fields, which is the office. Be¬ than
continuing present methods. mated, can be trained to meet all
New York 1, N. Y.—20 cents.
ating room will give a continuous sides sprving as part of a svstem
At this stage, f think, we have unforseen
developments, or en¬
I

understand

that

his

vices both large and small. There
you fit it will be small businesses in
engi¬
di¬
mensions. So we see another asset neering, development, sales, serv¬
of automation—quality improve¬ icing and maintenance of product
and the inventive spark that has
ment and control. I might briefly
founded many new concerns
in
cite two examples of such equip¬
the past will be even more preva¬
ment.
lent.
A visit to any automation
Computer Marvels
show will demonstrate sucb trends.
a

States*

1222 •—Uv

have

would

mechanization

United

tyne

automated

manufacturing,

—

indication

and

record

large

for control, the computer in itself
is having a
profound
effect on

dowed

number of human behavior factors.
In this case,

technology.

of course, the trans¬

broadly
explored
some
of -the
areas *of ..automation
to begin to
Much has been writ¬ bring it into focus from the stand¬

with

built

with

of. Employment of Older Women: An
Annotated Bibliography — U. S.
Department of Labor, 341 Ninth
for re-

understanding

general objectives.

Machines • can

memory

Volume 187

Number 5724

The Commercial and Financial
Chronicle

...

(1183)

Ave., New York 1, N.

>; cents.;

'' i

,
_

Fifteen Major Current Tax Problems Analyzed—Complete text

Our

■

Fourth
"h

presented

papers

Annual

Reporter

the

Institute

I Correcting Educational Faults

Governments

By ROGER W. BABSON

a lie

decrease

discuunt

raie

tne

Federal

Reserve

Banks

:Frey Report—Analysis and evaiu-

is another sign that easier
money market conditions will
be, continued for the foreseeable future. This is taken
by most
money market specialists to mean that credit will be more
ample
and one of the quickest
ways to bring this
about is through

£.\ ation

the

the market

countants—Journal of Taxation,
Inc., 147 East 50th Street, New

York 22, N. Y.

(cloth), $4.95.

advertiser

**'
'

;

another

agency-

media

working relationships —
Association
of
National
Advertisers, Inc., 155 East 44th St., "

[fr
r

New York 17, N. Y., $50.00.\

/t;-

Hearings

Before

the

will

;

nomic

Committee

Joint

Eco-

the

Con-

gress

the

United

reserve

commercial

Press,
;

Perils

Sales
and

Enos

3V2%

it was

Hail
York

—

Prentice-

Inc.', 70 Fifth Avenue, New
11, N. Y. (cloth), $7.50.

North

revised

berships,

(V:

Progress

Enterprise

The

Steel

Inflation:

Fact

States

side

Booklet

—

ting air conditioning
Gas

Lexington

Avenue,

New

Advertising Agen¬
Lexington
Avenue,
17, N. Y. (paper).

Guide—Waldo

Supervisor's

Fisher—In¬

dustrial Relations Section, Cali¬
fornia Institute of Technology,

Pasadena,, Calif,
—

(paper), $1.00.)

The

Czechoslovak

Question in the United Nations

take
at

have

reserves

that

are

time

concerned.

the March

the

reserves

This places them in a posi¬
tax borrowing which

There

also

can

America, 4125 West 26th

Street, Chicago, 111 (paper), $2.
States

United

Savings

Bonds

ulations

—

be additions

member

Printing Office, Washington,
C. (paper).

What

job?

The

System shortly.

reason

the

for

belief

•

Commercial Banks

—

You

Want

from

Your

Booklet explaining

technique

tions,
Ann
•

—

Debrodt

Publica¬

512 West Hoover Street,
Arbor, Mich, (paper), 50b

(quantity prices on request).

Wholesale
dexes

Prices

195*-56

—

and
U.

Price
S.

ment of

In¬

Depart¬

Labor, Bureau of Labor
341
Ninth Avenue,
New York 1, N. Y., $2.00.
Statistics,

needed

out

because

cannot pay

high

costs

schools.
Sam

school

who

want

funds

out

for

cite the need for

purposes

higher

to-

maintaining

Those
dole

salaries

for

teachers.

the

Such

gram, though started on
tions

hurt

over-all

rather

than

granted
into

shall

could

easily
of life.

way

mean

our

ourselves

disaster

for discipline and
To do this, we must take

must

the end of

favor

that

requirements

reserve

the

the assumption that

th\$

for

merit

near-term

which
the

economy.

obligations for
prepared

This would be

addition,

favorable develop-

the Treasury

new money

for just such issues.

This will

Treasury out of the long-term market

offering

will be tapping

market

suit

is
a

that

new

Exchange Members
a

ANGELES,
have

members

the

Calif.-Three

Are

Not

the

Sam

being asked
grant scholarships to pupils as
incentive
work

for

them

to
an

better

generally and to undertake

studies in scientific fields.

sound idea to give scholarships to

exceptional students; but why expect Uncle Sam to finance them?
governments
ball

the

been

Pacific

Coast

one

resulted

change,

intra-firm

elected

Stock

Ex-

from

membership
transfer
through
purchases of

two

President of
Co. became

transfer
Daniel

what

may
not be able
sufficient time to study.

The two
new

firms

the

The

new

Arnold

Seidel

Co.

of El

Paso, Texas.
Exchange members are
Co.

and

Harold

Milton

ails

are

can

Ralph S. Moore, Assistant Sec-

corporated, passed away

Mar. 3.

vvn re-

weia Dranrn

not the

office

sturdier

Paper Common
D.

Blauner

tribution of

Co.

Ine.

{fne

paper

and paper

products.
The company sells its
products today under the trade
name "Sphinx."
Upon
completion
of
this
financing, outstanding capitalization
of the company will consist of
400,000 shares of common stock,
Associated in the underwriting

Joins Bache & Co.

need—and what I have

advocating for
a

answer

complete

long time

overhaul

our

(special to the financial Chronicle)

MIAMI

Bache

BEACH,

Hirsch

Fla. —Sidney

affiliated

now

with

Building.

Co., 1
He was

Anderson

Cook Company, Inc.

Lincoln Road
formerly with

}?deJow*rd teachers and pupils.
Henry Montor Adds

f"5°.?^u
*ts
emphasis on self-expression, it

(Special to The Financial Chronicle)

CHICAGO, 111.

—

a c

k H.

in many
Today, respect for
teachers is the exception rather
than the rule, as is respect for the

Musliner has been added to the
staff of Henry Montor Associates,
Inc-» I34 South La Salle Street.

rights of others.

our

schools.

Children

Are

Gur

True

°ur lnie

w^ormeriy with H Hentz g
^rensky

T^r

Co-» Inc1

a jj

£>acne /\oas

Teachers and educational theorists should not be blamed for all

HARTFORD, Conn.—White, tlm troubles that beset our schools
& Co. has opened a branch today.
We
parents
and
grandat 750 Main Street under parents are also to blame. In our
the direction of C. Spencer Smith,
eagerness
to
avoid
controversy
Weld

make

Saxon Paper Co. is engaged in
the converting and wholesale dis-

na
un

day

some

Stock at $4
Milton

Wealth

one

for

prey

Saxon

educationally.

destroyed discipline

Ralph S. Moore

Seidel, partner of Morton
&

Ex-

change, Morton Seidel & Co.
Los
Angeles,
and
Harold
Stewart &

membership

Weston

give

civilization,

member through the

the

retary of A. G. Becker & Co. In-

purchases admitted two

member

As they

are: Aetna Securities Corp.; Haland local lowell, Sulzberger, Jenks, Kirkpartly carry land & Co.; Roman & Johnson;
However, scholar- and L. D. Sherman & Co.

system. For the past
couple of generations, we have
been growing "soft" in our atti-

in the Los Angeles
it was announced by
Naley, Exchange Board

Chairman.

Weston

Toboco.

memberships

Division,
Frank

of
D.

Daniel

gins have

should

here.

ships alone

—is

Toboco,

and

demanding social life that

Local business interests

What

Stewart,
President
of Harold S.
Stewart
&
Co.
Milton

boys

educational

Coast

ourselves

by precept.
As for study: The blame for
iack of proper study habits
among
children
today should
be
laid
squarely upon the shoulders of
parents. Lax fathers and mothers
push
their
children
into
adult
pursuits too early in life. The re-

our

school hours.

been

private borrowers for the available supply of these funds.

people.

young

them

hiking and Associates, yesterday "(March
salary levels to get better teachers. 12) offered 112,500 shares of Saxon
But I do not think it fair to the
Paper Corp. common stock at $4
tax-paying public to give teachers per share.
large increases in pay simply for
Net proceeds from the sale of
acting as baby-sitters for our chil- these shares will be added to
dren
and
grandchildren during working capital.

likewise take

competitor with

our

teach

by example, as well

that

As for teachers' sal¬
in

generation

help this trend

that

hurl

economic

Study

must do for
is to restore

respect

easier

remember

and

pro-

economy.

should

gr0w older, these social hobUganominal- tions? increase and
study gets still
propor- less attention.
Failure to correct

level, would grow to such
the

thing

interest

they

schools.

And when

young

Discipline

The first

such

these

Restore

aid

our

interest?

Washington should proceed
cautiously in the matter of Fed-

think

eral

people, do
we
know how to talk to
them,
how to capture—and hold—their

Federal

pointed

day's

Uncle

raised

member banks of the system.
i

new money which will
by the Treasury will have to be in issues tailored to
meet the needs of the deposit banks.
This means short-term
obligations which will build up the liquid position of these in¬
stitutions. Also, the money supply will be added to through the
sale'by the Treasury of new money raising securities to the

and

methods-time measurement

Scholarships Alone

system's banks will be cut again is based
the bulk of the $3 billion or $4 billion of

—

Government

aid

another

Yet most of

much time with

Answer

LOS

U. S. Treasury Department reg¬

favor

with

are

study.

Salaries?

local communities

aries:

—Chechoslovak National Coun¬
cil

in a month as we spend
working out the details of a single

being raised in

are

problems

have

young

are as impor- their

ability to pay is limited. If every
request
for
government
aid
is

income

year.

that

Teachers'

schools.

this

reserve requirements of the member
time,, at least put these institutions on the plus

care

About

serious

will
two.

not spend

that

in the future.

Treasury Will Rely

Years

the

420
York
'

Taft-Hartley Act:

Ten

banks

forget

physics and chemistry.

aid

the

decade

eager¬

lost preseconomics

our

they

programs—

tion Advertising—American As¬

420

of the Federal Reserve

of Magazine and Farm Publica¬

York

member

requirements would be.
since the Treasury will have to be in the market for
new money in the very near future, it is expected that there will
be another reduction in reserve requirements of the member banks

Suggestions for the Advancement

New

Association,

17, N. Y., $2.00.

cies,

the

slower process than a reduction in reserve

sociation

that

our

to restore

ness

tige,

Uncle

institutions through open market
operations of the Federal Reserve Banks, since the purchases of
Treasury bills by the Central Banks will put more reserves at
the disposal of the deposit institutions.
This, nonetheless, is a

Cor¬

;

funds

their

Rofer W. Babson

proper

discount rate since last No¬

However,

Success

American

far

usual

are

-private utility companies with
plans for launching and conduc-

But

The recent reduction in

request.
to

The

banks has for

tion

well

Many voices
Washington in

our

colleges. In

What

Further Cut in Reserves Seems Assured

poration,
71 - Broadway,
New
6, N. Y. (paper),-copies

Steps

amount

continue to be

Fie-

vs.

Steel

not

was

scientific

high
schools, as

of the

lower discount rates have been taken
by the
market to be principally psychological developments and
in the main that is true. However, it should be
kept in mind that
the successive lowerings of the Central Bank rate has been a
definite reaffirmation on the part of the
monetary authorities that
the policy of easier money is still very much in
vogue and will

York

;

and

tion—United

•

requirements

reserve

concentrate

and

money

Development,
711
Avenue, New York 22,
N. Y., $2.00.
•

reduction in

Mainly Psychological

the

with.

work

Fifth

•/

declining as a result of the in¬
seeking an outlet in these securities,

elementary business agreement.

and^
merchandising
tant

rates

want

subjects in

money

has

increased

^Economic

new

brought with it easier money market conditions,
although the reductions in the discount rate, by itself, has not

anniversary meeting
of the Committee for Economic
Development — Committee for

(

medium term bond for

successive decreases in the

vember

at the 15th

modest

American

versus

funds

part of its recent
intermediate and long

development to have the Federal Reserve Banks make
reduction in the rate which is charged member institutions when

Papers presented

—

the

N. Y. (fabrikoid), $14.00.

Soviet

use

they borrow from the Central Banks.

telephone and wire services, etc.

I
Wl

brainpower and moral fiber

meet

now

action

unusual

—Herbert D. Seibert & Co., Inc.,
25
Park
Place, New York 7,.
,

the

a n

Congressmen, which

care of a substantial

through

the debt management policy of the Treasury, it

of executives,

names

The

member banks and the limiting of the supply of near-term issues

mess, exchange and other raem.

supply

because
,r

geographically
and
alpha¬
betically
arranged,
includes
description of character of busi-

•

operation

their

officials

o n

Our children and grandchildren
our
true wealth.
We
need

are

1
f

is the lowest since November,'

much out of line with short-term rates.

frightAdmin-

ist ration

rate

public
school

about
our
administrators to avoid teaching
deficiencies.
Many ethics and morals—or at least we
people,
espe- have sat idly by.
cry

cially

purposes,

creased

—

and

ened

many quarters of the money market that
have .to be reduced eventually because

Thus, with short-term

Amer-

in United States
(including Hawaii) and Canada

hue

educational

position of the short-term money market.
v

Edition—Completely
directory of stock and

{ ) bond houses

launching of the Rus- regarding religion in
Sputniks,
there
has
been schools,
we
have forced

Slan

cut

supply

ica—1958

•

the

Favors better teacher

scholarship aid.

Since the

obligations

hasten

tended to limit the supply of short-term Gov¬
ernment obligations.
Also, the decision of the Treasury to retire
$100 million of Treasury bills this week did not help the

New York 16, N. Y. (paper), 500
Healers

current

rate would

very

raising

Association, 12 East 30th Street,'
Security

The

believed in

was

refunding

Conference—American Bankers

)

term

;

term bonds, and the use of

.Savings and Mortgage Statistics—
:r Annual Savings and Mortgage
>.

214%.

/of the Treasury in taking

Sampling Techniques in Account¬
ing—Robert M. Truebood and
Cvert

/1955.. It

B.IIaas

Perry—Prentice-

M.,

near

financing should

reduction in the: discount rate since the recession
started last August has brought; the Central Bank rate down
from

York 11, N. Y. (cloth), $4.45.
Richard

salaries but not Federal

much

bond market.

the-discount

Hall, Inc., 70 Fifth Avenue, New

neglected in school curriculum.

Treasury will have to be
and it is believed that this

third

The

Prosperity—

Horizons—Kenneth

This

to be

on proper study habits and
discipline,
example, and allowing ethics and morals

a proper

H-

Meany, Sr. — Pageant}
139 West 42nd
Street, ;

banks.

setting

Discount Rate Lowest Since November 1955

New York 36, N. Y„ S3.00.

;

the

■

Radio-TV:

that

requirements.

sector of the

Printing Office, Washing25, D. C. (paper), $1.50. /"

ton

requirements of the member banks

evident

The reduction in the discount rate to
214%
of the congestion in the

meat
<

reserve

not

helped to relieve
long-term Government, corporate
and municipal markets. Short-term, new
money raising operations
by the Treasury will have favorable effects on the long-term

ent of Documents, U. S. Govern-

shortly for new money
largely through the sale of

raised

the

life instead of
insisting

most

States:

January, 1958 Economic Report
of the
President—SuperintendT

reduction in

system.

■

Mr. Babson sets forth his views as to what is
wrong with our
educational system and with each criticism offers his
solution.
Holds parents responsible for:
propelling children into social

By JOHN T. CHIPPENDALE, JK.

Taxation conducted by the Texas

Society of Certified Public Ac¬
-h

o O

(Special to the financial chronicle)

MIAMI, Fla.

—

Vera G. Franck

been added to the staff of
Bache & Co., 96 Northeast Second
Avenue.

has

The Commercial and Financial Chronicle

(1184)

Continued from page

lems, then, the view that

mo¬

nopolistic market situation gives a
great advantage to its possessor

question

issue

difficult

positive

here,

answer

and

it is

very

which

one

given in

can

Thursday, March 13, 1958

birthrates—perhaps because of the
profound urbanization
life.

Finding

Atiraciive Place

Long-Run Effects
We

difficult

of view of so¬ 1929 to 13% in 1932; the propor¬
tion going to wages and salaries
whole the inability of
likewise rose from 58% to 73%.
agriculture to reduce output in r,
We may be pretty sure that this
depression is an almost unmixed
blessing. If it were not for this represents a shift from youth to
fortunate characteristic of agricul-* age—a depression almost certainly
ture

would starve in

depres¬

income markedly from the

shifts

Just

old.

the

how

turn to the much more

now

effects

the point

From

nopoly

the distribution

industry

take

must

historical

suffer from

unem¬

voung

Prescribes

food
•

well

did

production

the

decline.

not

had

farmers

been

able

Output

The farmer
may
not be the
protect their prices by restricting
most disadvantaged group in a de¬
outputs, as manufacturers
are so frequently able to do, we pression, but he is certainly on the
would not merely have suffered disadvantaged side of the line. The
answer to this problem, however,
loss of real income and unemploy¬
is not to improve the relative po¬
ment, we might have starved as
sition of the farmer by a still fur¬
well.
ther decline in the national prod¬
Does Society Exploit the Farmer? uct! The answer is clearly to pre¬

worsening
The question
must be raised
of the terms of trade of agricul¬
however whether this support of
ture in a depression is not a re¬
the rest of the
depressions. The

vent

in depres¬

economy

sion

by the farmer does not in¬
in a real sacrifice, so
that in a sense he is exploited by
the rest of society. It is true that
volve him

depression invariably involves
the
worsening of the farmer's
"terms of trade" or "parity ratio,"

and this
son

is undoutbedly one rea¬

an im¬
symbol for the farm
The reason for this is
basically in the different

why parity has become

portant
groups.

found

of agriculture and in¬
dustry in regard to output. The
farmer's terms of trade are what

responses

gets

goods)

(in real

unit of' wrhat he sells. In

for

sult

economy.

the rest of the
society in which

But this would be sheer
madness: the sensible thing to do

industry.

to improve agricul¬
terms of trade by increasing

obviously

industrial

dimin¬

output, not

ishing agricultural output — as¬
suming here that we are not talk¬

one

ing of a shift in output between
agriculture and industry, but sim¬
ply of unemployed capacity.
One further point in connection
with the depression experience is

What industry has to
him, however, has sharply
diminished in quantity. He can
up.

relevant to this discussion. There

buy less industrial goods with his
wheat, simply because there are

is not much relation between the

fewer industrial goods being pro¬
duced.
It
is
the
bathtubs
and

in the economy and the

paint

and

biles

duced
that

clothing

which

because

the

This

cannot

"real'-'

prices than in industrial prices.
The farmer of

versely
may

the

not

affected

ad¬

depression, and it
be doubted whether he is af¬

fected

dustrial
or

course

who

person

adversely than the in¬

worker,

the

the small business

the fact that there is

back to the farms in

stockholder,

worsened

Indeed,
slight drift

terms

de¬

severe

trade

opportunities

outwreighs the disadvantages,
that

with

compared
of

high

real

the

wages

for

the
employed and a large
chance of unemployment in indus¬
trial occupations, and full
ment at low real wages
ture there seems to be

towards

the

latter.

employ¬
in agricul¬

pull
really

some

know

very little about the inci¬
dence of depression on the dis¬

tribution of personal incomes by
occupations and by regions and by
large industrial groups. The only

which

groups

depression
fp—""+

ployment
a

clearly

•.

are

of national

interest

rose

""nuiUoQ

from
and

in "protected" em¬

positions,

—

gain

the receivers of inonrJ

those who

tion

are

■—

profits into almost all other

forms

which

with

—uit

income,

income

going to
sharply from 7% in

proportion

product which is con¬
tributed by industry, rather than
an expansion of agricultural pro¬
duction. If the total population is

enough

rapidly

rising

there may

cline

tion, but there will always be

relative decline.
In the United States for instance

the

agricultural population has
from something
over
colonial

15% today.
leased from

have

States

and

build up

times

about

It is the resources re¬
agriculture, moreover,

which

the

enabled

similar

United

countries

their industrial systems.
technical

If it had not been for the

improvement

agriculture

the

effectiveness

industrial

im¬

less.

the

therefore

have

would

provements
much

very

been

real

American

sense

standard

•

base

bor

income

probably protects

agricultural

im¬

Paradox of Productivity

Paradoxically enough, however,
it has been precisely this high rate
of improvement in the productiv¬
ity of agriculture which had led
the
relative disadvantage of

agriculture in the distribution of
One may put the matter

income.

that the only

crudely by saying

depression.

oly gives

any

there

firms

which

advantage. Indeed,
are

show
a

view

that

own

inertia

and

inevitably to be the

monopoly is a detri¬
monopolist himself in
times of sharp monetary
changes
whether of deflation

monopolist

point of view of his
does

not

enough in
raise

lower
a

even

inflation.
from

own

his

deflation,

interest

prices

fast

nor does he

them fast enough in

flation.

the

In these short-run

in¬

prob¬

which

into the
sources

the

out

move

declining

and

expanding industry. If re¬
are mobile a very slight

people to make the requisite
indus¬

duce

transfers to the expanding

tries; if resources are immobile it
will take

large disadvantage in

to induce
enough people to transfer out of it.
Mobility has two aspects: one
is the ease in getting out and the
the

decline

industry

of getting

sources

in. Re¬
in agriculture may be im¬

mobile

either

other

the

ease

because

customs, habits or

people

them from
because

the

there

are

laws1 which tie

land

and

prevent

leaving agriculture,

there

are

obstacles

people entering industry. The

the

contribute

land

ownership. If farmers
land by feudal
ownership and

land

in forms which freeze

are

consolidation

and make

extension of hold¬

ings difficult, or if credit arrange¬
ments

are

primitive that it is

yond what chance or inheritance

of the

possible importance of the
element of monopoly power,

Historically

one of the principal
obstacles to exit from agriculture

has

the

been

cultural

geographical

isolation

and

the

rural

population. In all previous civili¬
zations

there

cultural

r&ral

and

has

been

division

sharp

urban

between

the

people:

"Civilization"

word
literally
only in

very

means

to extend their operations be¬

has given them

in the

of land

way

equipment, or if inheritance

and

laws

splitting up of
children so that

among

encouraged

are

the

favor

estates

children

land

and

scattered

farm

and

stay

tiny,

inadequate

plots,
then the difficulties of migration
from

agriculture are accentuated.
parts of the world these
factors are of great importance; it
In many

is hard to believe that they are of

something that happens
cities, and the overtones of words

much importance

civil, urban, rustic, and so on
testify to the past differentiation

cial

between urban and rural life.

generally good, where farms have
been growing in size rather than
being fractionated, and where it

Insofar

the cities have main¬

tained themselves by the exploita¬
tion of the rural population they
have usually tried to

justify them¬
selves by the denigration of rural
culture as crude, primitive, and
uncivilized. It is to the very great
credit of our own society that to
a

large extent, at least in the field
commercial

have

agriculture,
this

overcome

of this is due to

the "civis." Part

the

revolution

transportation

communications

and

the

removed

has

which

geographical

communicational

and
of the

isolation

farmer—the automobile, the

skill

and

level

the

Whatever the reason, it is clear
that

the

agriculture at
is

commercial

area

rate the farmer

any

isolated from the
rest of society, and that this factor
no
longer can be invoked as an
explanation of the failure of re¬
longer

to leave commercial

sources

culture

the

of subsistence

area

which

sufficient

agri¬

amount.

agriculture,

the main prob¬
i cai 11 u r a<l ^poverty,
pockets of cultural and geograph¬
represents

lem of

g r

isolation
still
are
found,
though even here better roads,
radios, busses and so on are break¬
ical

ing down the old isolation.
A

dynamic factor which used to

not

great impor¬
in com¬
agriculture in this coun¬
the exit gate is pretty wide
are

tance

holding people

mercial

to
open.
The
one
existing institutions

easy
criticism of
which

might

made

is of the rural

score

this

school, which

might perhaps do more to equip
its
pupils for the urban lives
which

considerable

of them will face.

ference

proportion

Where the dif¬

between urban

culture is

rural

and

small, however, as it
is in this country this factor can¬
not be of very great importance.
so

Industry
Is

equal, if not superior to his
urban equivalent.

acquire

equipment.

is left with the conclusion

factors

educa¬

farmer

difficult

that the cultural and institutional

and

in which the farmer also is part of

land and

One

try;

people. For the first time in his¬
tory we have built a civilization

farmer

able

be too

not seem

does

lor

rural

in the commer¬
of the
United

agriculture

States, where credit facilities are

geographical

isolation

cultural

and

entrance

Entrance Barriers

the

then

tions

difficulty with the

into

rather

industrial

than

agriculture,

with

occupa¬

exit from

this at
partly to be explained by the
prevalence of monopoly or large
scale
organization in industry?
This
is
a
question to which '; I
frankly do not know the answer,
and which deserves very serious
study. I can think of no more
valuable research project in this
field than a good study of farmers
who have left agriculture in the
past generation. Unfortunately it
is nobody's business to study these
peopie:
having left agriculture,
they
have
passed
out
of
the
and

so,

least

heavily subsidized intellectual
area,
and they do not form an
easily recognizable class of people
or

considerable

pressure

group.

importance in
explaining the continuing surplus
of the agricultural population is

standing what is the matter with
agriculture may very well lie in

the differential birth rate in rural

the

Nevertheless the key to under¬

study

the

experiences

A marked feature of earlier

those who have left it. We do not

periods was the much greater re¬
production rate in the country

really know where they go, what
they go into, what fields are open
to them, and most
important, what
fields are closed to them. It might

areas.

than in the towns. This meant that
if

even

agriculture

constant
force
for

maintained

proportion
would

still

the

necessary

labor

people to

move from agricul¬
industry in order to feed
population increase of the

the

ment to the

The

expanding industries de¬

bound

are

ties,

institutions

the

and

ers

ture into

their

the

is to

elements

agriculture, in order to try
make some rough assessment

clining industry is enough to in¬

sensitivity to price policy

outcome

into the

out of

disadvantage of incomes in the de¬

and
seems

comes

found

difficult for able and active farm¬

that

lack

which

in in¬
between the declining and
differential

The

exodus

towards the mobility of resources

monopoly

profits,
of

for its workers and its cap¬

with which labor and capital can

evidence

point

comes

for its products and
to
relatively low in¬

Thus in the face of

position are too reluctant to cut
prices in a depression, even from
the

prices

pends on the mobility of resources
between them—that is on the ease

sharp deflationary movements it
is by no means clear that
monop¬

can

factor which may be
importance in preventing
from
agriculture is

some

existing arrangements,

least

substantially in

farm income very

various

the

situation

the

tion

italists.

The fact that so large a pro¬
portion of total farm income'is la¬

About the best
outline

Another

the

tenure

Farmer Is Not Isolated

which demands

the

therefore

'depression

mobility
of
resources
between
agriculture and industry.

cultural worker,

national income which suffers the
a

the

affect

provement, in the sense of con¬
stantly increasing output per agri¬

economic power rests

life and

for

which

factors

radio
and television, and so on. Part of
it is due to the high technology
of commercial agriculture itself,

low

decline

tenure

course

not be an absolute de¬
agricultural popula¬

the

fers. Indeed that broad division of

tenure
Pi

the

cannot go

is corporation profits!

than

combination

depression is
shift away

greatest

and

power

ability to

great

agriculture, the fact that it offers
employment

man.

pression indicates that in spite of
the

and

reasons
way to get people out of a declin¬
into here. The ing industry is to saueeze them
monopolist can protect his price out—that is, to make the declining
in a depression better than a firm industry less attractive than the
in
highly competitive markets, expanding ones. This is accom¬
but does not mean that he can¬ plished very neatly through the
not protect his profits. The decline price system; the declining indus¬
in output which the monopolist
try has a chronic tendency to¬
suffers is just as destructive to his wards over-production, as it never
profits as the decline in price declines quite fast enough; this
which the competitive firm suf¬ over-production leads to relatively

buy, be¬

phenomenon
behind the relative price changes
—the greater fall in agricultural

only

monopoly

profits.

marked
from

not there to buy!

are

the

protect

automo¬

being prounemployment

farmer

they

cause

and

not

are

distribution

food

total

the

90%

industry! We could, of course, im¬
prove the terms of trade of agri¬
culture by diminishing its output,
as the worsening of the terms of
trade are simply a reflection of
the fact that agriculture output
declines less than the output of

increase

offer to

agriculture, but is a result
something that is wrong with

ture

spent

Improvements in agricul¬
ture therefore result ultimately in

declined

income

with

depres¬
sion he has just about as much to
sell as before, as his production
stays

that is wrong

something

various

between

fibers.

their

Industrial

Increased

knowledge, is
importance of the distribution
of monopolistic and
competitive
markets, and the related distribu- 1
tion of sizes of firms, among the

dynamics of

relation

and

agriculture

mo¬

look for

moment lat the broad

the

especially as be¬
and agriculture.

power,

tween

Here

question of the long-run

agricultural techniques are im¬
shifts income from urban to rural proving there is a constant de¬
ployment
and from diminished
we
do not really cline in the proportion of the na¬
outputs of industrial goods. As it populations
know. It would not be surprising,
tional economy which is occupied
is, even in the severe depression
however,
if
we
discovered
that by agriculture, whether this is
of 1929-32. average food consump¬
tion in the United States did not there was a shift away from rural measured by labor force, by value
areas: more interest receivers and of output, or any other measure
appreciably decline, though there
pensionaires proportionally may This is basically because of the
is no doubt that the distribution
of food consumption worsened— live in urban areas, and certainly nature of agricultural commodi¬
more people with "protected" jobs
ties as "necessities"—goods of low
that is, some people ate very lit¬
income elasticity. As income rises
tle and some too well. Food con¬ live in urban areas.
a
smaller and smaller proportion
sumption did not decline because
sion

Land

the

Foi Small Commercial Fanner
ciety

be severely questioned.

may

of rural

'.
'
Ownership

the present state of

country into the population defi¬
ciencies
there

the

were

towns.

forces

Even

making for

turn out that
of

fitting

current
may

one
difficulty is that
small capital into the

industrial

structure.

not be too difficult for farm

laborers
the

without

capital

enter

industrial

may

working force: it
be quite difficult for a farm

relative decline in the proportion

operator, who is
capital,
to
find

people engaged in agriculture,
it
would
still
be
necessary
for
agriculture incomes to be some¬

niche

what

scale industry. We do not
expect,
of course, a farmer to start a steel
mill or an automobile
plant. There

less than

order to

tion

move

of rural

occupations.

the

incomes

popula¬

excess

into industrial

areas

This

of considerable
area

urban

factor

again

importance in the

of subsistence

agriculture; it

is of much less importance in the
area
of
commercial
agriculture,

where

birthrates

are

greatly different from

longer
urban

are,

with

laborer-plus-

equivalent
society. This
not have anything to
an

industrial

may or may

the

however,

existence

many

areas

large

in¬

dustry where small capitalists are
important — in retailing, in con¬

struction, in personal services and
in the professions. If however
one

(as
suspects) in fhe overall dis¬

tribution

enterprises

size

Volume 187

Number 5724

...

The Commercial and Financial
Chronicle

(1185)
there is
ber

disproportionate

small

culture,

enterprises in agri¬

this

obstacle

present a real
transfer of small

may

the

worker-capitalists
ture

from

agricul¬
industrial employment..

One

num¬

further

question needs to
be asked,
though here also a defi¬
nite answer is hard to
give. It is
sometimes argued that the farmer
is

peculiarly
he

cause

disadvantaged be¬
to large concerns

sells

artificial,

graphic location
tion. A

principle

Insofar

cording to this view he is subject
tp monopolistic exploitation from
his

suppliers, and to what

econo¬

mists call "monopsonistic"
exploi¬
tation from the
purchasers of his

products, squeezed between big
buyers on the one hand and
big
sellers on the other. We
certainly
cannot
deny the possibility of

marketing
attached to the

are

than

the

farmer,

attached.

are

benefits

the

fortunate
the

owned

Thus

quotas

scheme

the

accrue

individuals

farms

which

wishintf

of
to

TtoTobacco
Trov^^Sw
lopacco growing now

nas to

what amounts to a tax to the
present owners of these farms in
the shape of higher land
prices.
pay

A plan therefore which
vised
to
help
growers

was

de¬

simply

poor)

however,

have to be
of

and

would

also

among ; the

the

—

instance, paying

firms

price dis¬

purchasers, for
smaller price to

farmers with lower costs

with

lower mobility.
Otherwise,
sufficient mobility,

given

reallv need it
broadcast
not.

'help

farmers

the

75%

program

-designed
is
bound

simple

what weaker

tendency for all sub-

sidies

to agriculture to
be captured by the landowner. Where—
as

Discrimination

the

past, and in particular
this element of monopo¬

places,
listic
tion

Programs

should

novertv

redistribution

designed to deal with
not

poverty,

with

agriculture,

monopsonistic exploita¬
may
have been important.

Today, however, there are two
important safeguards against it.
is

the

Robinson-Patman

amendment

which

to have been at least

seems

the

Clayton

Act,

modestly effective in preventing
price discrimination. The
other,
and perhaps the most
important,
is

the

rise

operative.
usual

the

marketing

there

profits

processing

the

profits

for

profits

co¬

any

pioblem

un¬

not

cash

themselves

not

may

the

"middlemen"

may

serious, and that there are no
longer any large areas of unusual
profit for
the
cooperatives
to
undermine. This does not
preclude
the possibility of local situations

exploitation

this

this society than all the politiciarls
in legislative halls and executive

Business is by no means the sole
chief offender in this respect,

chambers or the generals and admirals in the Pentagon.

These

same weaknesses are found
in many of the organized
groups
in our economy,

particularly

its importance in the
past, it

major

A final word

concern.

become
manH
mand

the peculiar position of the land¬
in agriculture, for

although

not

problem

size

may well be a prob¬

monopoly. It is a long
established principle in economics
that an increase in
agricultural
income
tends
to
be
absorbed

eventually
either in
value

rise

the

rents

landowner,
or

the

property. This is espe¬
cially likely to be the case where
the location, of the farm
gives ,Jt
an

advantage,

nnH
and

tion

receive

increases

benefits without rela

and

wages

powerful that they de-

general

business

conditions,

checked, will bring down

economic house.

While the present recession may
slow

down the pace of

price

spiral,

whether

flames

the wagenot halt it.

will

inflation

this problem is the most

threat to
the

our

still

are

dangerous

economy is found in

announcement

last

that

week

the cost of living has reached an
all time high in the face of de¬

clining industrial production. In
addition, each day in a faltering
cwlluu,v
economy, UUUUICU3
hundreds of new labor
ujl

contracts'

of
ui

wases
wdgt-b

for automatic step-ups

and benefits

irrespective

apu uei^iiis, liiebpeeuve
of productivity. The philosophy o
more
pay for less
work can be
carried to
be

point where

dividing

will

something that we
At that point, instea

haven t got.

iare

lesson of

natural

decadent

shaping

There are no easy solutions to
these problems. At the most criticai
period
in our

history,

might ask ourselves questions like
these:

Are

business

complacent

men

preoccupied with

or so

our

immediate —un,v„,
problems that

are

not

wel-

state.

willing to devote

stahtial

.....

sub-

efforts and
abilities toward the elimination of
fundamental

business

weaknesses

system?

to face up

our

Are

our

willing

to corrupt and unsound

practices in business? Have we
the courage to fight
monopolistic
labor tactics rather than take the
expedient?
articulate

Will
in

tive reforms

equally

Or,

open and

intn

calpc

acknowledged.

-''v:Honest"-:U;
V

that all groups are
to
society?

sum

also

up,

and

dealers

securities,

are

prepared to accept
dealers

our

hu¬

for your

you
when you sell them securities.
Well then, study your

do
,

markets;

follow your situations; pick good
sound analysts and read what
they
say

but don't swallow it all with
shut; and remember that

your eyes

the only way you can gain
poise*
nmrVnt

rkKilifir

catririr

•

*a chai2§in£ world, whether

-form of society

our

manly
,

kllslness

onrcpivee
m,

the

fima

dedicate

solution

'
our-

some

major

pro51ems> we shall
recrea^e a national
image — an
image which? for well over a century captured the imagination of

•

>ld. B
d jn| we shall
legacyJ o£ a str0®g America
s0

leave
and

wor]d

which

our

children's children shall live.
Must

Fuse

Group Interest

Requests ljke these do not pro¬
mote
the
well-being of future
generations. In this legacy we are

Laudy and Harden With
Spencer Trask & Go.

This

problem if

uuv

the

real

we are

institutions

uuu

the

sidelines

with

time to buy good values in

com-

stocks, but the weight of evidence is strongly in favor of the

mon

core

which

As far

the bond market goes,
in these days of managed money,
as

y°u have had an education in
this business it is no great trick

to know when
bonds and when

against the world-wide challenges
they now face.
Our

form

Co.

•«

wUh

which

associate5

Mr.

Manaeer of

society is shaped
around a free enterprise or capi¬
talistic system. Consequently, the
responsibility for moral leadership rests primarily on business.
Thousands
of
business
leaders

Don't

should

you
you

buy

should begin

Afraid

I Don't

tain

ters,

PORTLAND, Ore.

Toomey is
811

—

with Earle C. May,
Southwest Sixth Avenue.
now

every
in the year, it is

your

good
one

living and it won't matter
whit whether you had a few

lean months doing it.

Lenz With Smithers
SAN
t

FRANCISCO

owen

Clifton

Lenz

a(ided to the staff of F
«

russ

Calif
has

been

Smithers

Buildm<*
to*

[nkn<ion JjL

Johnson

Admit

,,WU13VU

*-*««««►

MIAMI

BEACH, Fia.

—

Morton

A. Chauser has been added to the

by cerwho write market let-

those who prepare

staff of Bache & Co., 1 Lincoln
Road Building.

propa¬

other problems which

host

rationing at the*/,1

allocation of all civilian sup--

and

off /

forces

„

examination

Agricultural Products
Still

his

level

the

or,

which

combat

wartime

its

wartime inflation,

invited

proceeds

ill

control

consumer

priced'

jurisdiction

eluded

unfounded. Such restrictions can¬
not

tion/we tackled the job of turn-;,^ tfc+
resentment might-well take the
ing to the businessmen of our /
form of a rather blunt statement
"country. We separated our various
to
the effect that.: if Canadians
industrial, commercial and trade"/
have grievances, so have AmerL:
interests into appropriate groups, J
cans,
and
that Americans.^ are and we invited the business
lead-',/;
getting a bit fed up with the1 ers of these
respective interests to/,
rather
cocky
"chip / on - the sit down with us to work out

crude, it was shown to many of
your friends north of the border

apprehensions

are

person -.who
guesVvand
criticize
and
berate the policies of the country

import restrictions were
to apply to
Canadian

about

then

extended

that their

comes

when

month

Last

agement of the Canadian Wartime;/
Prices & Trade Board, which
in-:jr

Reaction

beginning to wonder just
am
trying to do, I would
surprised at a reaction of

man-1

ganization, co-ordination and

year.

and

lege to be entrusted with the orT'

be expected

may

to'*j

solid economic base on'JI
It was my pTvi-,'

the home front.

judge from

can

by this time, some

doubt

present out¬

reports, further dis¬

news

programs

Now

Therefore, last July when
restrictions were applied on the

the

Action

years.

import

during the coming

well known in our coun¬

was

try that oil imports have been a
subject of some controversy in the
United States for a number of

ket, I think you will appreciate
efficient in the world. He does* why Canadians have been con¬
not understand why, if such is the cerned about what
they call your
case, American manufacturers of "fire-sale" and "give-away" pro¬

the.

with

preserve a

most

of their Canadian sub¬

grain

So far

you

my country
that by giving
Canadians, an active interest in
success

external

look.

that

thing

plants finished goods should fear fair
were
originally
established
in competition from Canadian firms
Canada most Canadians felt they across the line.
would provide an additional op¬
Energy Resources Development
portunity for equity participation
in projects operating within their
In much the same vein, a num¬
own
borders. They also thought ber
of
questions about energy
that these new firms and plants resources are
being asked north of
would provide opportunities for the border. A
good part of the
Canadians to advance to top posi¬ capital that has come to Canada
tions
of management.
In many in recent years has been used to
pointed

our

puzzles Cana¬ products
in
markets
outside
expect other Canada. Canadian farmers have
place in the world are not ap¬
countries to pay for their imports long since learned to live with the
preciated,
then
perhaps the
from you if you do not make it fact that your country does not
United States could get nasty too,
possible for them to do it either want our dairy products or other
and with much more„„devastating
directly by exporting goods and agricultural commodities, and has
results.
' '//
services to you, or indirectly by applied trade barriers to show it,
Now, if I were to hear such a
way
of third countries. "Trade, but I do not think most Canadians
The

dians

which read

problem

Canadians

well

faced almost

physical and material resources

development.

were

comfort

such

most

tries

for

little

into by the United States covered
movement
of other products to commodities valued at almost $5
speculative nature, but
your country has been restricted. billion.
Of
this
total, approxi¬
most of it represented direct in¬
How can one explain to people in mately one-fifth was given away,
vestment in plants and facilities
Canada that you like to sell to somewhat less than one-sixth was
for the production of basic and
them, but you do not want to buy bartered
by private contractors
raw
materials. Among other
their goods or, indeed, the goods for imports of commodities for
things this inflow of capital has
of other countries, in exchange?
government
stockpiles, while the
been
responsible
for
increased
In
general, U.
S.
protective rest was sold for local currencies.
Canadian production of such basic
tariffs on manufactured goods are Other large amounts of agricul¬
materials as nickel, copper, lead
not liked by Canadian business¬ tural
commodities
have
been
and zinc.
men. It is the belief of the aver¬
shipped abroad with the aid of
Yet Canadians are now "faced
age businessman in Canada—and export
subsidies.
It
is
little
with a possible tariff hike on ex¬ I tend
to agree with him—that the wonder that this flood of .agri¬
ports of lead and zinc to your American
tariff
structure
en¬
cultural products into the markets
country. Many Canadians do not courages the processing of Cana¬ of
the
world
has
met
with
understand the logic of this pro¬
dian raw materials in the U. S., vigorous criticism from other ex¬
cedure. On the one hand, on de¬
and
thus
tends
to
inhibit
the porting
countries.
Canada,
fense and other grounds, you help
and
build-up of secondary industry in Australia
Argentina
have
us
to develop new resources; on
Canada. This is done by means of protested
about
the
effects
of
the other hand, you make it dif¬
these
high tariffs on products of ulti¬
special programs on their

took the form of portfolio invest¬

ments of

being

the

markets is about to end, but I see

tries.

sidiaries, that United States com¬
panies would add greatly to their
own prospects north of the border.
The capital

applied

pressure

possible

were

development

subservience

trace

that

lieve

common

Canadian-American Relations

feel

by American spokesmen that
of
such
resources
would make a contribution to the

Problems Endangering
no

They were

wish

the existing
Canadian-U.
S.

correct

imbalance

the

Volume 187

Number 5724

The Commercial and Financial Chronicle

(1187)
we, each

understanding

of:our

thought

each

business counterpart, then we may
well find that the seed will germinate and produce the fruit of
knowledge and understanding so

one of us, in the course
day-to-day business with
other,,pay particular atten-

tion to the
emergence of such friction

points, then
9ble to talk them
spective
would

ought to be

over

spheres

our

re-

activity.

surely not be too much to

of how

and

——~

——

apple seed

even

and

our children's children will be
able to taste it and find it Hood
—
1

———-——

countries

our

though most of us may
pot live long enough to see the
fruit, nevertheless, our children

vital to the perpetuation of good

expect that with a clear appreciation on both sides of the border

pinge

and
constructive relations between
whenever he meets hisvLet us then
plant

—

Continued from

page

individual actions im-?

our

the

other, prudent pre¬
cautions could be advised in time
to

prevent

arising.

serious

This, is

disagreements

factory operations to about 60% of capacity in February, dealer
stocks showed a 7% increase from
January.
v
Commenting further, it declared that "an element of control"
has been injected into dealer new car stocks.
It said that while

not

a. job
for
government.; It is, I suggest, a job
lor the businessman. The need for
<

action, at the diplomatic

politi¬

further increase in the auto stockpile

cal

level, tends to arise when
something has gone sour, and
emergency; action is needed of one
type

or another.

often

too

late

the

friction

we are

threatened
effects / of

having

been

live

become

the

breakdown.

allowed

world

„

■

cars

and

trucks

scheduled

Ford

Division

last

slashed

week

its

car

has

entire week.

complex that we sim¬
ply cannot expect to leave every-

American Motors

sales

increase

over

January,

Corp., despite

was

also

down

Wheeling Steel Corp. brought three blast, furnaces and its bessemer department back into production.
On Monday of this week
it is scheduled to reactivate two additional open hearths. But in
Detroit, Jones & Laughlin Steel Corp. suspended operations.
On a national basis, the steelmaking rate dropped 1 point to
52.5% of capacity.
Production was about 1,417,500 net tons of
steel for ingots and castings as against
2,411,000 tons a year ago.
"Steel's" composite on the prime steelmaking grade of scrap
held at $37.17 a gross ton for the third week.
The

American

operating
capacity

for

weekly

all

the

past

week.

Manufi.etmera inventories, regarded as a sisnal of the pace of
!he buslncss recession, were cut at a faster rate in January than
sion an^ "understanding aVe ^Ual /; JU December, the United States Department of Commerce reported,
mid,f as I have said, my further -f '
The^ sharper'iate^-pf liquidation in January was "very sigsuggestion is that day-to-day com- v piwcaiit
and -reflected, a continuation of pessimism by mantifac4

tuicis..over 'the -immediate- prospects for a sales pickup. Along
manufacturers' sales and new orders continued
>
m
nuai7' ^ficials stated.
:. .
iff
>
not always possible to prevent the
^ -Th©y January cutback in nianufacturers
inventories put the w
^^g^ W the total book value ap a seasonally adjusted $52,900,000,000. The
journal box- but at least we khowix'-deI)ar!;,^en^ reported that while inventory trimming, was wide- <
municatiori

businessmen'"""

between

would

do a great deal. Railroad^
know, for example, that it is

ers

thatswith

careful

irispectibh-:

intelligent lubrication,

we can

formation

of such groups as .the
Canadian-American "Committee of ..

....

...

thetNatiOhal ^anmng-Assoeiatlpiiy;
which has been organized for
the^

Factual studies

way in

these,,

under.

are

completed,

are

any
jn

both sides of the
that.

will

border,: I

have

might

hope thai Jhc inventory

reverse

itself

Understanding

and

:
Let me conclude by recalling a
delightful legend of early Ameri- >■
can
history.
Most
of you will

Appleseed.^'

continuation of the trend of recent

months, nearly all the
in durable goods." On a seasonally

seasonally
steady

held

$13,600,000,000.

seasonally adjusted basis, in the "hard goods" sector. The
new orders for these producers came primarily in

the electrical machinery and aircraft industries.

Steel

Operations Scheduled at 53.1% of Ingot
Capacity This Week

people, Johnny Appleseed seemed
Odds that there will be a strike in the auto industry in June
a simple soul with only two pashave- dropped 6 to 5, "Steel" magazine declared on Monday of
sions in life:
(1) he liked apples;,the.-current week. Three weeks
ago, odds were 3 to 1 that the
•

and

(2)

he liked to

walk.■■ It

.is vfvUultddr

recorded .that.he wandered from.
Pennsylvania through the present
day States, of Ohio, Indiana, Illi¬

the

primitive

course

his

land.

walks

Workers would

walk

out.

•

improvement in the possibility of auto-labor peace refleets the weakened position of the auto workers due to lower
than anticipated auto production and increased industry unem¬
ployment, the m'etalworking weekly added.
:>
The question in the past has been whether management could

nois and up into Canada, enjoying
his habit of walking and looking
over

Automobile

In ,the.

afford;a strike.'The situation

munched
.

now

was

that

when

"he

apple,

he/fin--

carefully

strike.against speedup demands emphasizes workers attitude.
So
does the union's Refusal to strike against Chrysler over a similar

selected a su i t a b 1 e spot, and
dispute..^
".iT
;
/,
-.7planted the. apple core, and cov-^Steelmakers are still looking for the first clear indications of
ered it over carefully in the; hope>., av„.brisiness;:ppturh; states "Steel."
So far as March is concerned,
that it w^cKiid germinate;
Theredoes not seem to be in the cards. Steel men believe
„

were,no

apple trees in

any

ofthen, ApfiV^wilLsee the start of the upturn.''-V'

through^ which, he walked-,
but in due course of timevsomeof
areas

treesV

the

started
were

from

his

sprout,

apple

and

men

cores

who

clearing land for agriculture

•

For.one thing, automakers are turning out more cars than
arp'selling. As a result, they must curtail production. Ford
'Mptor iCo.i will operate on reduced schedules for several weeks,
CJbieyrolet^one of the strongest producers until now, also plans
cutbacks.f/lt already has canceled about half its April steel orders.'

•

M^denljr. realiSc?

that here was f!! - As c^-buUders push March orders into April, cold weather
opportunity: to produce a fruit s, Mhders; .construction. There has been: no pickup in demand for
bearing crop. The consequence is .-plates or structural. Nor have the heating and plumbing industhat many of the large oixhards- ^'i^llFr.eased their purchases erf buttweld pipe.
The seasonal
an

which
fUp

are

vannii*!

Canada,

now

commonplace

stafps

well

im-"upturns ;Spv;: these products,
in.

•

.„

the

been

businessman

would

plant his seed of goodwill,

Plant^

sheet inventories are the lightest For several months, consumers
been fabricating substantially more tonnage than they have

•

way,

well as for merchant wire, may

f"** of mtaJor,.St£f ?r0Sucts held!"

directly from the
fact that Johnny Appleseed liked
to plant his apple cores. In the
came

same

COlTie a ,plohth late.

Institute

will

announced,

that the

and

for

steel

for

1947-1949)

average

castings

(based

with

compared

average

actual

*88.7 %

the

the week before.
For the like week

duction

month ago the rate was *90.0% and pro¬
A year ago, the actual weekly production

1,445,000 tons.

placed at 2,401,000 tons,

was

•Index of production is

for 1947-1949.

*149.5%.

based

...

■

average

weekly production

Electric Output Recorded Declines for 4tli Straight
amount

electric

Week

distributed by the electric
light and power industry for the week ended Saturday, March 8,
1958, was estimated at 11,793,000,000' kwh., according to the
energy

Edison Electric Institute.
For the week ended March 8,

1958, output decreased 10.000,previous week and 74,000,000 kwh, cr
comparable 1957 week* but increased
660,000,000 kwh. above that of the week ended March 10, 1956.
000 kwh. under that of the

below

0.6%

Car

that

the

Loadings Climbed 12.4% Above Preceding Week
And 21.4% Below a Year Ago

Loadings of revenue freight for the \Veek ended March 1,1958,
61,256 cars or 12.4% above the preceding week, the Associa¬

were

tion of American Railroads reports.

Loadings for the week ended March 1, 1958; totaled1 553,645
decrease of 150,338 ears or 21.4% below the corresponding
1957 week, and a decrease of 157,331 cars, or 22.1% below the

cars, a

corresponding week in 1956.

Automotive Output Reduced the Past Week as a Result
Of Assembly Cuts and Plant Closings
Automotive production for the week ended March % 1958,
according to "Ward's Automotive Reports," declined due to plant
closings and cuts in car assemblies.;
;
1
^
^

Last

week's

ear

output totaled

84,202

units and. compared

with 91,508 (revised) in the previous week. The past week's pro- '
duction total of cars and trucks amounted to 102,442 units, or a
decrease of

6,517 units below that of the previous week's output,

"Ward's."

Last

week's car output decreased under that of the previous
by 7,306 cars, while truck output climbed by 789 vehicles
during the week.
In the corresponding week last year 140,161
week

cars

and

18,835 trucks were assembled.

Last week the agency reported there were 18,240
in the United States. This compared with 17,451 in

trucks made
the previous

week and

18,835 a year ago.
Canadian output last week

placed at 6,080 cars and 1,155
trucks.
In the previous week Dominion plants built 7,303 cars
and 1,209 trucks and for the comparable 1957 week 8,749 cars and
1,308 trucks, '
7

Lumber

was

Shipments Fell 6.2% Below Output in Week
Ended March 1, 1958
,;

Lumber

shipments of 483 reporting mills in the week ended
March 1, 1958, were 6.2% below production, according to the
National Lumber Trade Barometer. In the same period, new orders
were 10.9% below production.
Unfilled orders amounted to 28%
of stocks. Production was 3.6% above; shipments 1.8% above and
new

orders were 5.0% above the previous week and

21.6% below

the like week in 1957.

Business Failures Continue to Climb in Latest Week
Commercial aad industrial failures climbed to 358 in the week

acteristic

ingot

Steel

*89.8% of steel
beginning March 10, 1958, equivalent to

the week
of

and

companies

of capacity, and 1,425,000 tons a week ago.
week beginning March 10, 1958 is equal to
about 53.1% of the utilization of the Jan. 1, 1958 annual capacity
of 140,742, 570 net tons compared with actual production of
52.8%

is reversed.

With.more than 200,000 workers idle in Detroit ideal union
.officials are. hintihg they want Walter Reuther, UAW president,
-•••

apples (he always seemed tq have
an! abundant
supply), but r his^-, tq .accept any honorable settlement enabling men still working
sound and'forward looking.charto stay on the job. The recent refusal of a Pontiac UAW local to
ished

Iron

steel

production

rate of

states

The drop insurable goods sales amounted to 3% from Janu/afy^; »with primary metals and aircraft companies reporting larger
than average relative reductions,

rn^ny,

■

hand

reductions in

remember the story of John Chap¬
man
who came to be known as

"Johnny

v
New orders, at the end of January also showed a pessimistic
picture for durable goods producers. The seasonally adjusted rate
..of; incoming business for durable goods producers was 7%.
In
dollark, the decline for all manufacturers in January from the
previous month amounted to $900,000,000, with $800,000,000 of this,

friction between our two countries,

Knowledge

quickly

anr

taken

significant step in the direction of
reducing present; and prospective

manufacturers

to a total of! $12,600,000,00(1 in January on
and;?theirs adjusted basis. JNon-durable goods producers' sales

labor leaders and educators

sure

among

on a.seasonally adjusted basis.

number of areasr and a^ b;
000,000

findings made known to businessmen,

$26,300,000,000

January inventory decline was
adjusted basis, stocks of durable goods industries at the end of
January were down by $500,000,000 from the previous month.
These "hard goods" manufacturers also bore the brunt of the
drop in; sales, with their share of the total going down by $700,-

information. on!the .problem areas■
of United rStates-Canadian, relg-'
tions.

themselves with a short of supply of goods
business upturn should occur.

x. v.

of disseminating objective

purpose

and--'Tn'fnventorie^ ?n°fhiCe^P fabout one-half the drop
re-7anlS^KmnaS
sector occurred .among auto
Y^i^%^a^ers1 &Iei werejdown by $400,^00,January

Si£eto
ffinlTte gfad To
cutback

sizzling February

" 4h- -

been'talkingahoijf

I have

rate

1,442,000 tons

The

governmenT °In th^swtof^hin"

in good demand, with large quantities being

are

used for ductwork in the air conditioning of office buildings.
On the basis of a modest improvement in
orders, Youngstown
reactivated two open hearth furnaces on March 1.
Last week,

Output for

assembly in half,
idling plants all week at Alanta, Ga.; Dearborn, Mich.;
Memphis,
Tenn.; St. Paul, Minn.; Mahwah, N. J.; and San Jose, Calif.
Chevrolet, additionally, closed three plants for one day, Dodge at
Detroit three days, Chrysler at Detroit one
day and De Soto the

/;;77'<'

which

one.

Reflecting inventory adjustment,

point

>,.'•/ 7

diminishing

assembly in United States plants dipped to 102,442 units, the
smallest total of 1958 to date. This
compared with 108,959 in the
preceding week and 158,996 in the same week a year ago,

amicable

unfortunate

unchecked

see

buildup is

rate

for

By that time it is

settlement, and
with

inescapable, the

seems

galvanized sheet

b.uying. They buy only for spot needs and seldom have to
wait more tharf two to three weeks for delivery.
•
Production of tin plate continues at a near-capacity level and

ended

March

from

331

the preceding week,, Dun, &

Brad-

street, Inc., reports. At the highest level of any week since
January 26, 1939, casualties exceeded the 327 occurring a year
ago

Continuing above the pre-war level for
failures were 9% above the 286 in the comparable

and the 268 in 1956.

the sixth week,
week of 1939.

Casualties

rose to
An, increase
also occurred among small failures with liabilities under $5,000,
lifting their total to 41 from 32, but remaining below their 1957
level Of 45. Thirty-seven of the businesses failed with liabilities
in excess of $100,000 as compared with 32 in the preceding week,
All industry and trade groups except manufacturing suffered
increases during the week.
While the retailing total edged to
178 from 176 and wholesaling to 32 from 27, construction casualties
climbed sharply to 50 from 38 and commercial service to 34 from
23. More failures occurred than last year in all lines. The most

involving

liabilities

$5,000

317 from 299 in the previous week and 282 last year.

noticeable

Six

casualties.

rise

from the

1957 level centered in service concerns.

major geographic regions reported heavier
While most of these week-to-week rises were mild,
the

nine

the East North Central total

climbed considerably to 60 from 49.

Only two declines appeared, including a dip in the Middle Atlantic
States to 113 from 116.
In the Pacific States, casualties held

steady at 67. More businesses succumbed than a year ago in all
regions except the South Central and Mountain States* New
England reported over twice as many failures as last year and
Cnntinupd

on t>aae

The Commercial and Financial Chronicle

(1183)

Continued

jrom

Continued

page

jrom

page

accumulation of inventories

The

Thursday, March 13, 1958

marked in capital goods and

was

Central

North

west

States also had

considerable

increase

1957.

from

Despite this,

The

Dun

the fourth

Braastreet

wnoiesaie

straight week to

new

juice

index

high for 1958 and

for
at the

was

highest level since February 15, 195o when the index stood at
The index climbed 1.2% on March 4 to $0.60 a week
This was 0.7% higher than the $6.09 of the comparable
date last year.'
:;v' Vy.4 vVy^:?;:4::y4r ■■ 'V';,-y X,4:,?4''':'!'4
earlier.

Commodities quoted

higher the past week were hams, hogs,
beef, steers, eggs, potatoes, tea, wheat, corn, rye, oats and oariey.
Down in price were flour, sugar, cottonseed oil, milk, cocoa,
lard, bellies and lambs.
The

index

the

represents

foodstuffs

raw

sale level.

and

1957

grains, some livestock and
cotton.
The Dun & Braclstrcet daily wholesale commodity price
index reached 280.92 on March 3, slightly higher than the 280.40
of the prior week, but moderately below the 290.66 of the similar
date-a year ago...

Mixed

some

-.v,;.,;J:•'y;;■-4-;,'y>■ 4■4.y

trends

prevailed in wholesale grain markets during
corn exceeded expectations with notice¬
able increases in prices.
While prices on wheat were close to
those of a week earlier, costs of rye and oats slipped somewhat.
Announcement

that

figure, of $2.09

the

Government

would

maintain

bushel for the 1958 soybean crop, the

its

loan

same

price

Increased

were

buying for Lenten needs and
rice

moderate gain in
prices at week earlier levels. There

slight decline in" raw sugar prices as trading dipped
somewhat.during the week.
"
;
Wholesalers reported a slight dip in coffee
prices, rcsultihg
from reduced purchases and expanded, stocks. A moderate decline
In cocoa transactions occurred, paring prices, below those of the
preceding week.
.*4.4.4
:./4.';4: 4'
4-" Trading in steers in Chicago equalled that of a week earlier
and made for increased prices. Although cattle receipts
expanded
slightly over the prior week, they were down about 10% .from
a
year ago. .Increased trading at the beginning of the weekboosted hog prices, but they sagged somewhat at the end of the
period. Hog receipts exceeded those of both the prior week ,.
and the similar 1957 period. There was a moderate dip during
the week in lamb prices as purchases slackened.
Wholesalers
reported a slight decline in the price of lard.
Cotton buying was stimulated the past week
by reports that
the .Department
cf Agriculture might remove about 5,100,000
acres from production
this year and that unfavorable weather
prevailed in some growing areas. This resulted in another increase
in cotton prices on the New York Cotton
Exchange. The Census
Bureau reported that about 799,000 bales of cotton were consumed
in the five week period from Dec. 29 to Feb.
-1, compared with
842,000 in the similar period of 1957. .Exports of cotton for the "
,

week ended last Tuesday were estimated at 162,000
bales as
against 113,000 in the preceding week and 281,000 a-year ago.
Total exports for the current season
through Feb. 25 were about
3,443,000 ibales compared with 4,469,000 last season.
' ''' >

Trade Volume the Past Week Rose Further

Consumer

Buying Increased
There

was

another

moderate

rise
in consumer buying last
equalling that of the similar week
Sales of women's Spring apparel were stimulated by

week with total dollar volume
year.

favorable

weather

in many areas.

Price reductions

electrical

appliances helped volume in household goods. Automobile dealers
reported

moderate rise in the call for

new

passenger

noticeable year-to-year declines prevailed.
The total dollar volume of retail trade in

cars,

but

the period ended

Wednesday was from 2% below to 2% higher than a
spot estimates collected by Dun & Bradstrcet, Inc. show.

year ago,

Regional
the following
percentages: Middle Atlantic States +2 to +6%; New England
-fl to -j-5; South Atlantic —1 to +3; Pacific Coast —2 to 4 2;
East North Central and West South Central —3 to
+1; Mountain
—4 to 0; West North Central and East South Central States —5
estimates varied from the comparable 1957 levels
by

An upsurge in the buying of women's
Spring apparel occurred
during the week, with principal gains in dresses, fashion acces¬
sories, coats, sportswear and millinery. Volume slightly exceeded
that of a year ago.
Although interest in men's suits, hats and
furnishings advanced a bit from a week earlier, a slight

year-to-

over-all

volume

prevailed.

Sales

children's

apparel moderately exceeded those of the prior week.
The cancellation of fair trade
policies by some manufacturers
of electrical housewares

lines and

electrical
year

ago.

improved,

to be found in my.

policy, with a re¬
lagging supply of money,

turn

had

accumulation

effect

cussion.

dur¬

based

resultant

the

(and I might say part of it has
in

areas

where

resulted

considerable increase in

lower

retail

consumer

prices in many
purchases of small

appliances over those of both the prior week and a
While volume in major appliances and television sets

slight year-to-year declines prevailed.
Despite
a
in the buying of bedding, total sales of furniture

moderate gain

.* ■ V"

y.v,

■■

■4'
by

curtail excessive in¬

need

ac¬

ventories, can be held to manage¬
able proportions; Here it might be
pointed out that while we have
been f oeusing attention on curtail¬
ment of output in recent months,
in reality it actually started in the
early part of 1957.' ';?•-4 444";'444
(2) Defense Orders placed in the

that in 1952 and 1953.
inventories

found

(1) The present decline jn
tivity, having been initiated

The need to liquidate
been

-V.,.

several major considera¬

tions:

readjustment in 1954. We added
some inventory in 1956 and, to a
lesser extent in 1957, but it was
not equal to

subsequent dis¬

further in intensity or duration is

important in a business
readjustment, as has been very
evident during the postwar period.
We added considerable inventory
tremely

in 1952 and 1953 with

: -

My belief .that the present de¬
cline will not extend very much

in¬

trend of inventory
liquidation is ex¬

The

ventory.

very

There

was

further

rise

sales

4 r

;

!(3)

baked goods,

foods.

week earlier.

.
-4 • - ' V-'
44 >
"Attendance at the New York Gift Show proved disappointing,
.

and

orders for glassware,

dinner ware and gifts were somewhat
below those of the similar event last year. There was a slight
rise in purchases of air conditioners and fans.-Volume in refrig¬
erators, automatic dishwashers and television sets also expanded
fractionally. Interest in furniture, draperies, floor coverings and
linens was close to that of the previous week.
Textile
wholesalers
reported
a. slight
increase in fill-in
orders for cotton sheetings and print cloths, but over-all trans¬
actions in cotton gray goods were sluggish. There was a moderate

gain in the buying of combed cotton knitting yarns.

Interest in

woolens and worsteds continued to sag, and
terized sales of carpet wool in Boston and

sluggishness charac¬
Philadelphia.
A moderate rise in the buying of fish, poultry and fresh meat
occurred during the week.
Interest in dairy products was sus¬
tained at a high level. The call for frozen foods dipped, and, as
a consequence, wholesale inventories climbed somewhat, New orders for machine tools

rose

about

...

10% in January to

$27,300,000 from $24,900,000 in December, the National Machine.
Tool Builders Association reported.
The total, however, was a
sharp 64% below the January 1957 level of $75,500,000, the high
point of the year.
The outstanding installment debt decreased about $368,000,000
in January, a sharper decline than the $259,000,000 drop in January
1957. Much of the decrease was centered in auto paper, according
Total installment credit outstand¬

to the Federal Reserve Board.

ing at the end of January amounted to $33,700,000, up 7% from
that of the similar 1957 period.
Department store sales on a country-wide basis as taken from
the Federal Reserve Board's index for the week ended Mar. 1,
1958, increased 1% above the like period last year. In the pre¬
ceding week Feb. 22, 1958, a decrease of 18% was reported. For
1, 1958 a decrease of 8% was reported.
For the period Jan. 1, 1958 to Mar. 1, 1958 a decrease of c3% was

the four weeks ended Mar.

recorded below that of 1957.
Retail

trade

registered

sales

volume

New

York

City the past

result,

small

weather, plus
the

garment

appliances

accounted

for

the

pick

strike

recently

and

like period

in ready-to-wear business as
continued heavy purchases of

removed

improvement

week

from

during

fair

trade

restrictions

the week.

According to the Federal Reserve Board's index, department

local: spending,"

and

has* been

tending steadily

shown its effect in the bond mar¬

the advance has

ket where

•

been

of the

greatest mr some time
and yields have already decreased
one

considerably. If. has also helped
the government in its refinancing
program; This easier, money trend
has also been evident on the sup¬

ply of mortgage money.; i 4;
(5 ff Residential Cvolumeh a s
signs of having- reached a
low. While there is> little likeli¬
hood of atv immediate- sharp sus¬

shown

tained

upturn, the outlook is for
improvement above the 1957

residential starts

low level. New

of up to

LI million for: the year
This

are-not- too much to expect.
is still less than

our*

needs* '

;; *

(6) The outlook1 is- also" favor¬
able

for

whole.

construction

new

The5 government

has

al¬

ready estimated that the total will
approximate " 5% ' more than in
1957. In addition to the improve¬
ment in residential building and
an increase'in home additions and

alterations; there are also definite
indications of an increase in pub¬
lic construction, with new high¬
ways providing part of the stimu¬
lus.
In fact,
increases are also
indicated for hospital and institu¬
tional building.
Moderate Upturn
One

the

major

1958

between

1954

and

•

differences
is

that

there is not much likelihood of

equal in intensity to that
of 1954. The second most impor¬
upturn

difference

tant

10 to 15% gain above the volume for the
of 1957, trade observers reported.
a

third

population)f continues to expand;
(4) Easy "'money has; already,

noticeably stepped up their buying of women's
Spring coats, suits, dresses and fashion accessories in preparation
for an early Easter selling season. Trading in Easter merchandise
rose most noticeably in the East as buyers anticipated a possible
strike in the dress manufacturing industry in New York. Whole¬
sale volume in men's apparel in the latest period was close to that
Retailers

second, and

upward
(ay normal development
with increased needs of a rising

dairy products, offsetting declines in canned goods and
Volume in fresh meat, poultry and fresh produce
equalled that of a week earlier.

Shite

which

canned

fish and

the

quarters?-' v\4:4 yv-,;.44

The call for linens fractionally

exceeded that of the similar 1957 week,.,

Good

decline

has

sharp upturns; The basis for my
estimated conservative upturn is

doubt that the

money

sultant

unchanged from last year.

were

—1%.

year

tight

continuation, of the trend

frozen

last

orders should

trend in

begin to reverse itself, but not to
the
extent
of other periods of

export sales helped hold
was

Soon

to End

expect that tho sharply

declining

corded

sluggish again last week, causing
Flour receipts at New York railroad
Friday amounted to 24,986 sacks with 8,846 for '
export and 16,140 for domestic use.,' r
v
- y 4. .4on

Decline

bushels, about 200,000,000 bushels
the largest crop since 1953. ,
•

Transactions'in flour

(especially

sustained) to encourage

I would

quarter;

weekly, take-home pay because of didn't suspect it existed) has cer¬
the cut in overtime, and the wide¬ tainly been responsible for the past 90 days have Shown, a sharp
some
.extent:' they
spread
emphasis on depression decline in output, employment upturn^ To
factors.
v
'4:
.> and payrolls.
:
; * match • in volume ; the' decline re¬

prices to fall moderately.;
terminals

orders. There is

and
equipment outlays.
(5) Some weakening of con¬
sumer
confidence resulting from
increased
unemployment, lower

this year would be 1,150,000,000
year or

can

ing the latter part of 1956.
(4)
A decline in plant

support as for the 1957 crop, resulted in a moderate price rise
on soybeans at the
beginning of the week, but declines occurred
at the end of the period. ' Over the week-end the Department of
Agriculture estimated that the yield of Winter and .Spring wheat

higher than last

tight money situa¬
tion during the early part of 1957,

Transactions in

tlie week.

.y .,:yy

graphically, the rever¬
U-shaped rather than

say,

made

been

have

upturn in output.

own interpretation is that
present decline was caused
mostly by inventory readjustment
and
sharply contracted defense

orders, especially during the sec¬
ond and third quarters.
"... 4
A

second

the

end

with sales

the

normal readjust¬
rising business
be attributed to the

high is
during

(3)

the

decline from

the

inventory.
*
v
(2) The sharp decline in defense

The general commodity price level actvanced again last week,

the

V-shaped.

(1) The over-rapid expansion
in production. It resulted in over¬
production and accumulation of

Commodity Price Index Shows Further
Slight Advances the Past Week
increases

about run

course.

trend and

Wholesale

reflecting price

sal will

ment

the

significant

will

or,

Let

believe

either in

reversal

felt,

at the latest, in the
third quarter. It will come slowly.

decline will end
must deter¬
decide

the

point

been

very

quarter

mine the reasons for it and

_j following:

•

for

discuss when and at

has

there

and reverse itself, we

Before
what

their

sum

meats

sufficient correction in inventories

of these

factors

the greatest ef¬
various unfavorable

that

believe

fect

securities market,
sharply mounting
bankruptcies, etc.

which factors may have

total of the price per pound
general use and its chief
function is to show the general trend of food prices at the whole¬
31

do not see such

sharply lower
bank failures,

rose

$6.89.

although

little likelihood of
immediate sharp upturn. I look

trade.

symptoms of previous depressions
as
drastic declines in prices, a

High

iouci

A less favorable balance of

(6)

4.49

million, the highest since 1950.

Wholesale Food Price Index Climbs for 4th Straight
Week to New 1958

Unemployment

was

in non-durable
goods. Unfortunately, total inven¬
tory figures
do not provide us
with a perfect basis for analysis,
inasmuch as a good portion of the
total represents stocks of defense
materials. It is my belief that by
the end of this quarter or before

Industry The Economic Outlook

The State of Trade and
the

goods.

durable

consumer

less

that

not

showing the
by the end
of the year as it did during the
latter part of 1954. The reason for
a
lag in the upturn in employ¬
unemployment

see

same

rate

ment

decline

found

full

em¬

ployment and the tight labor mar¬
ket

has

which

existed

since

the

store sales in New York

City for the weekly period ended Mar. 1,
1958 increased 3% above that of the like period last year.
Jn
the preceding week, Feb. 22, 1958 a decrease of 31%
(revised)
was reported.
For 'the four weeks ended Mar. 1, 1958, a decrease

the war. While it
may be difficult to prove, I be¬
lieve we may have been hoarding

of 6%

For the period Jan. 1, 1958 to Mar. 1, 1958

the

registered below that of the corresponding

rally,

was

registered.

decline of

*1%.

was

period in 1957.

beginning

about

million

one

many

war.

Natu¬

of these have been in

the labor force who, under* normal

conditions,
^Comparison period begins with Dec. 30-Jan. 4 week in 1958
and with Dec. 31 -Jan. 5 week in 1957.

since

workers

beginning of the

would not have been

there. With margins squeezed and
with

labor

costs

high

and

still

Volume 187

Number 5724

The Commercial and Financial Chronicle

(1189)
rising, although at a smaller rate
of gain, the
tendency/will be to

lic's
one

operate

and

January proved

efficiently and avoid

over-staffing.
expect

important,

earlier.

normal

development following a
business decline of the proportions

of the current
<

fear.

favorable

increase in productivity,

psychological

than

The

November
deal

reaction

Sales

was

decline

which

been

quarter,

December

the end

expected
in

October-

caused
must

concern

By OWEN ELY

Disposable income will average
higher for the year despite the

Interstate Power Company

indicating a moderate upturn, reasons—the flu epidemic, Sput¬
not
ignoring the prospects of nik,
the
President's
illness, increased unemployment and the
*;continued lag in; plant and weather, etc.
lower
take-home

I don't expect will

While

heard

than

who

to overlook

seem

are

secu¬

Time

that the

talk¬

and

the

ranks

gov¬

The

absolutely

are

gen¬

consumer

has ; not

been

depression.

consumer

bulwark

Those

who

think

"...

Government will give sup- through various means, es-f
pecially in view of the fact that
1958 is an important election year.

port

not
a

The American businessman will
act as he always has
during a

is are

cent years.

The

period of marked competition. He
will resort to creating
something

something different, at

new,

cellent

values.

the

ex¬

past

several years, it will be a question
of selling rather than

producing.

selves to be caught unprepared as
we were at the outbreak of the

Why

Consumer Will

Not

Sit

Most

Around

Korean War. Who among us would
be foolish enough to think Amer¬
to

you

sumer

developments of recent months.

connection

with

con¬

the

factors

will

con¬

vitally needs to be strong. The

threat

needs and wants. *■/•"

The current

tribute to the strengthening of the
American economy at a time when

A few facts should be of interest

ica would not try to catch up and
exceed
the
.Russian
scientific

-Communism

•

While

great.

tendency has been

Communist

still

military

penetration is not making progress
book, <lNo Major Depres¬ to look to the past for some
at the moment, economic penetra¬
Our, Lifetime,", I have guidance. One of the factors that
tion
is
gaining ground. We all
given a fuller analysis to the has always beenv, looked to has
know
that
a
strong American
part played by government spend¬ been what happened after each
economy is essential to the free
ing in the modern economy. De¬ major war. One cannot ignore
world.
fense spending is
not the only history, but it would be short¬
The need for a strong economy
item *- in government
spending. sighted and unrealistic to ignore
In my
In

sion

and

Government spending has become
will continue to be an im¬

quite different than 10

portant tool in the support of the

World

the fact that the world of

would

Consumer

the

spending
national

gross

gov¬

components
expenditures.

spender—the

Most

consumer.

year's recovery
is the consumer. The importance
of
consumer
spending to gross
national

spending' can" easily "be

realized

when

noted

that of

gross national

$433.9

billion

expenditures

spending total of
1957, consumer
amounted to $280.4
in

billion. Consumer

spending, there¬
fore, represehted 67% of the total.
Consumer spending is influenced
by income, unemployment, sav¬
ings, debt and psychology. Let's
take up some of these items.
Income

will

not

the

business

needs

for

This does not spell out
sion. We

literally catching our
continuing onward,
imply that the next
10 years will be a repetition of the
past in every respect. Our capacity
is larger and our costs are greater;
breath

that

have

failed to grow in the past several

that our economy has been
expanding more in dollars than in
physical volume; labor must take

years;

another

look

its

policy of
steadily rising wages without a
pause for consolidation.

new

ment

has

is at 4^2

now

been

million. There

ment

concerned

about

any

ord, though

of the gain was due to mergers. Revenues in¬
$9 million in 1946 to nearly $26 million in 1957 and
$1,526,000 to $3,712,000. However, share earnings
are
about where they were in 1948.
The disappointing trend of
share earnings seems partly due to a decline in the
percentage
earned on invested capital, plus an increase in the common stock
equity from 18% to over 31%. Earnings are expected to make a
better showing in 1958, being budgeted at
$1.05 to $1.10 a share.
The company in May last year sold
$20 million 1st 5%

Group

Of IBA Conference
CHICAGO,
States

Group

Bankers

111. —The Central
of the Investment

Association

America

will hold its 22nd annual confer¬

March

the

Speakers scheduled for the

con¬

ence

and

$12

million

of permanent financing will be consummated in 1959 to
retire bank loans and to provide funds for
construction; a substan¬
tial amount would probably be in first
mortgage bonds.
Interstate Power operates

increase
1958

short-term

amounted

billion.

debt

Summarizing
my
they are as follows:

per

less

than

General business
on

ference

Psychology—At

the downturn began

time

since

has the pub¬

Gross

total

low

National

production,
not

later

Product

should

than

the

and

reach

second

Edward

become

affiliated

with

some

difficulties:
some

cov¬

and it hopes to negotiate such

municipalities.
Substantially all industrial
sales, sales to other electric utilities, and a small

of electric sales to
or

other

classes

business

are

made

contracts which provide for rate adjust¬

compensate for variations in the prices of coal, oil and
Electric rate schedules with fuel

all classes 6'fblectric"service

being filed in all communities served.
Interstate

Power

has

been

are

..a

selling

recently

The price-earnings ratio based

L'r

14%r to

around
on

now

budgeted 1958

estrnirigs approximates 13.8.*''* ■***''
-Common Stock Record-

Dr.

Siegler & Co., Union
Building, members of
the Midwest Stock Exchange.
Commerce

encountered

other

clause adjustments covering

Revenues

Year—

(Special to The Financial Chronicle)

has

gas

natural gas used for boiler fuel.

1957——

—

Stein

cent

ments to

Philip M. Huaser,
Chicago, on "Dy¬
namics America
Population
Trends and Forecasts"; Professor
Malcolm Dole, Northwestern Uni¬
versity, on "Industrial Uses of
Atomic ' Energy";
Edward
P.
Rubin, Security Supervisors, on
"Outlook for Business &nd Secu¬
are

University

CLEVELAND, Ohio—Samuel L.

activity, based

power

under rate schedules

1956

...

Dividends

learnings

Approx. Range

$26

$1.01

$0.80

14V2-12

1.00

0.77

151/4-13

LOO

0.72

153/4-12%

0.685

-ioy2

0.63

10%- 83/4

1955

1954

0.97

1953

0.91

1952.—.

0.89

0.60

1951

0.80

0.60

1950

0.84

0.60

93/4- 7y4

1949

0.94

0.60

33/4- 6y4

1948

1.02

0.30

71/4- 53/4

1947

the

conclusions,

principally in two states (Iowa and
state commissions to regulate rates; on/

utilities have

municipalities in trying to raise gas rates. Interstate has
gas-rate schedules which provide for automatic adjustments

yield about 5.4%.

Drake.

bonds

and 680,000 shares of common
stock, to finance the acquisition of
the Mason City properties and to apply on construction and
pay
off bank loans. It will
require about $6 million bank loans to carry
out the 1958 construction program.
It is expected that about

schedules

On the other hand, the

some

creased from

the other hand Iowa

our

steam

net income from

economic

time in

The company was reorganized as of March
31, 1948 and divi¬
dends have been paid since
Sept. 20 of that year. As indicated in
the accompanying table, the
company has had a good growth rec¬

1946

year ago.

gain of nearly one-third. New plant included

Minnesota) which have

slowing down in the present rise in unemployment and
Westheimer Adds to Staff
rate of increase and, in fact, some how to
rectify the situation. This
("Special to The Financial Chronicle)
re-employment may develop while is an important election
year.
CINCINNATI, Ohio—Mrs.
unemployment
still gains. Em¬ Government
assistance
through Elizabeth
D.
Carlin
has
been
ployment will tend higher later tax reductions, monetary manipu¬
added to the staff of Westheimer
in the year, while unemployment lation and
spending for defense and
Company, 322 Walnut Street,
will decrease.
and public works will be an im¬
members of the New York and
Savings — Consumer cash and portant instrument in support of Cincinnati Stock
Exchanges.
holdings of "E" bonds at the end the economy.
of 1957 approximated $234 bil¬
Summary
With Edward N. Siegler
lion, or about $9 billion more than
a

generating station in Mason City with rated capacity of 26,000 kw.,
and a 5,000 mcf. LP peak
shaving gas plant.
<
j

Disposable income
In this connection, may I point
(personal income-after taxes) will out that this is an unusual
type
average
nominally greater this of readjustment. The wholesale
year than in 1957. If there is a and
retail
price
indexes
have
personal tax cut as seems likely, hardly shown a
ripple. This ex¬ rities Markets"; Rilea W, Doe,
the consumer's position will be
plains Washington's concern about Safeway Stores, on "Three Little
that much better—and a tax cut the
forthcoming inflation while Adages and How They Grew";
cannot be ruled out at the present we
are
still
in
a
deflationary Shelby Cullom Davis, Shelly Cultime.
lom Davis & Co., on "Opportuni¬
trend.
ties for Insurance Stocks."
Employment—Total unemploy¬
In the meantime, the Govern¬
—

construction) net utility plant increased from $63 million to

$83 million,

ering variations in the cost of

are

remains

a brick and tile works, a soy bean
plant and a beet sugar '
extraction plant. As a result of the 1957
acquisition (together with

greater

before

fact

plants,

with

Central Stales

but it doesn't

The

adjacent communities.

The area thus acquired has an estimated
population of 60,000 of
which about half is in Mason
City, a trading and distribution cen- /
ter. Local industries include a meat
packing plant, two cement

electric

depres¬

Savannah, 111.,

revenues by about $550,000 as a result. On
May 29,
1957 it purchased the
People's Gas & Electric Division of Kansas ;
City Power & Light Co., serving about 18,600 electric and 14,000'
gas customers in Mason City, Iowa and eight

literacy — including the Govern¬
ment, and the businessman, are
than

increasing 1956

situation.

must history.

currently.

to this

answer

that

consider the differences that exist

There remains the most important
the

America's

not

one

mean

The company has been
acquiring new properties and rounding
its territory.
In 1956 it acquired and merged Northwestern'
Illinois Gas & Electric Co. with
headquarters at
out

temporary marked fluctua¬

tions

War

cognizant of the past,

not

have

permit me
to
dis¬
tinguish between the past and the
present. Thus, while one should

Key

So much for business and

ernment

does

after

I, the Civil War or
the Spanish-American War. Time

national economy.
'■

1958

years

cattle and

1957-58 decline will be
characterized by remarkable price
stability. ■:.1:' C*j.
/r.\v: £
t

ation.

going to sit around waiting for

enough to
allow our¬

again

wide fluctuations.

eral, the

essentially healthy economic situ¬

desires of the American public.
They are under-estimating
the
changing economic forces of re¬

foolish

rather

Principal activities of the territory are agriculture, including
raising of corn, wheat, oats, alfalfa, peas, soy beans,
poultry,
hogs; dairy farming; and food packing and processing.
Industries manufacture
furniture, cellophane, tractors, steel prod¬
ucts and wood
milling.
;>. /
j
r

the

fractionally higher for the
individual items may show

year,

are

miscellaneous.

While average wholesale prices

the

tically with the threat of Com¬
munism facing us?
Who among
will

inventory accumulation will
especially in view of the

will be

„

cautions

served

some

continue

into

enough

than

The American

to believe %that we will
cut back defense spending dras¬

later

not

frightened and it is not likely that
he will become frightened. He will

drawn

Iowa, is the largest city
a population of
58,000. Among other communities
Clinton, Iowa, 35,000; Mason City, Iowa, 30,000; and
Albert Lea,
Minnesota, 19,000. Electricity accounts for about 83%
of revenues,
gas 16%, and bus about 2%, with a small amount of
steam and hot-water
heating. Electric revenues are about 47%
residential and rural, 26%
commercial, 12% industrial and 15%
served, with

liquidation,

relative stability in prices.

hear

ignoring the rising trend of
population, the higher standard
of
living
and: the
needs
and

would- be

lag,

will wait with

unrealistic.

Who among us would be foolish

support to

mosphere
clears
and
there
is
greater assurance that he will not

These

spending,1 and particu¬
larly spending for defense.

ever,

con¬

time in the second quarter. How¬

with auto¬

again

consumer

unemployed.

ernment

think

terminate

the

all
except absolutely
necessary
purchases until the economic at¬

That factpr

that

is well stocked

apparel.

period immediately preceding the
War.

have
that

its wardrobe is well stocked with

economic factor that did not exist
before the war or even during the
Korean

often
weeks

mobiles, washing machines, stoves,
refrigerators, television sets; that

depression
very important

How

recent

emphasized

sumer

spending will rise steadily
outlays of $40 billion for
are
certainly in the cards.

Those among us

defense

ing about recession

public does not have to buy. The
public can wait. Time and again

This lag in plant and equipment
outlay will be offset by greater

and

down.

way

tkey
item in the present decline, should

that
spending is going to go

consumer

rity

Inventory

record volume. I do not agree

factor in the economic trend.

National

favorably with last year's

compare

$4.5 billion, annual rate, from the
1957 high to /the
1958 low, the
total
will
still
be
very
large:
Nevertheless, it is still a negative

defense spending.

consumer
spending may payments will act
aggressiveness,
it
should personal income. ;

lack

Interstate Power serves an area of about
10,000 square miles
(properties being fully interconnected) in northern
Iowa, Southern
Minnesota and northwestern Illinois. The
area is in the richest *
farming section of the country. Dubuque,

Transfer

pay.

equipment outlays during the rest
of the year and
possibly into early
1959. We can
hardly be expected
to increase our plant and
equip¬
ment outlays as long as we are
operating at 78% to 80% of ca¬
pacity. Even with a decline, which

Utility Securities

uct.

Public

compared with the upturn in
output and Gross National Prod¬

partly
explained by other than economic

one.

likely toward

great

but

of the first quarter.
The
upturn will be slow and, in fact,
the gain in employment
may lag

91/2

71/2

—

—_

With Mountain States

With A. L. Albee

(Special to The Financial Chronicle)

DENVER, Colo.—Roy E. Patter¬
has been added to the staff of

son

Mountain

Securities

States

Cor¬

poration, Denver Club Building.

BOSTON, Mass.
Tole has

Capital

111. —Arthur

now

Securities

connected

Company,

South La Salle Street.

Arthur F.
with

Square.

Joins Shaine Staff
(Special to The Financial Chronicle)

(Special to The Financial Chronicle)

CHICAGO,

—

connected

A. L. Albee & Co., Inc., 4 Liberty

With Capital Securities

Fishman

become

with

209

GRAND
J.

RAPIDS, Mich.—Justin
Emery has joined the staff of

B. Shaine & Co. Inc., McKay
Tower, members of the New York
Stock

Exchange.

The Commercial and Financial Chronicle

(1190)

Thursday, March 13, 1958

* INDICATES

Now in Registration

Securities

Blacksmith Shop

Manufacturing Corp.
5,000 shares of common

Aeronca
Feb.

stock (par $1). Price—$6 per share. Proceeds—To go to
selling stockholder. Office—Germantown Road, Middle-

in units of
stock.

Ohio.

Air-Shields

(letter of notification) 4,650 shares of common
stock (par $1). Price—$21.50 per share. Proceeds—To
selling stockholder.- Office—330 Jacksonville Rd„ Hatboro, Pa. Underwriter — W. H. Newbold's Son & Co.,
Philadelphia, Pa.

Feb.

Underwriter—Mann

American-Caribbean

Feb. 28 filed 500,000

Oil

Co.

York.

Bridgeport & Port Jefferson Steamboat Co.
(letter of notification) 30,000 shares of common
stock (par $5) to be offered for subscription by common
stockholders of record Dec. 31, 1957 at the rate of three
new
shares for each two shares held.
Price—$10 per
share.

shares of common stock (par 200).

Proceeds—To construct

vessel.

new

-■*" »

Offering—Indefinite.-,.,

;

•

Commonwealth Telephone Co., Dallas, Pa. (3/20):
Feb. 28 filed 71,200 shares of common stock (par $10)
to be offered for subscription by common' stockholders

Jan. 30

Y.)

(N.

REVISED

$25^000,000 of first mortgage bonds due
Sept. 1, 1968, $20,000,00 of subordinated debentures due
Oct. 1, 1968 and 3,000,000 shares of common stock to be
offered in units as follows: $1,000 of bonds and 48 shares
of stock and $100 of debentures and nine shares of stock.
Price—To be supplied by amendment. Proceeds — To
construct refinery; Underwriter—Lehman Brothers, New

capital.

ISSUE

ITEMS

filed

Dec.

one

gage notes and for working
& Gould, Salem, Mass.

Inc.

Commerce Oil Refining Corp.

capital stock (par $l) to be offered
$50 debenture and 20 shares of capital
Price—$90 per unit. Proceeds—To retire mort¬

40,000

Underwriter—Greene & Ladd, Middletown,

town, Ohio.

Pastries Inc., Rockport, Mass.

Sept. 17 (letter of notification) $100,000 of 6V2% deben¬
tures dated Sept. 16, 1957 and due Sept. 15, 1972 and

(letter of notification)

•

ADDITIONS

SINCE

Offices—Port

record

for

each

March

five

7, 1958 at the Tate of one new share
to expire on April 3.

shares held ^rights

Jefferson, N. Y.; and Bridgeport, Conn. Underwriter— ;; Price—To be supplied byi amendment.' Proceeds—To re¬
pay bank loans. ,Underwriter — Eastman Dillon, Union
None.
'
7'"' '
'»•' -'v:
Securities & Co., New York. 7/
;
* *'V
'
7'
'
★ Brunswick-Balke-Collender Co. (4/2)
Consolidated Edison Co. of N. Y., Inc. (4/22)
March 11 filed $8,593,200 of 15-year convertible sub¬
March 3 filed $50,000,000 of first and refunding mortgage
ordinate debentures due April 1, 1973, to be offered
bonds, series O, due April 1, 1988. Proceeds—To retir^
for subscription by common stockholders of record April
?
short-term blank loans and for construction program!
2, 1958 at the rate of $100 of debentures for each 18
Underwriter—To be determined by competitive Lidding;
shares of stock held; rights to expire about April 16.
Probable bidders:- Halsey^'Stuart & Co.* Inc.", Morgan
Price—To be supplied by/amendment;
Proceeds—For
Stanley & Co.; The First Boston Corp. Bids-^To be re-*
working capital. Underwriters—Lehman Brothers and
ceived by company up to 11 a.m/ (EST) on April 22. ;
Goldman, Sachs & Co., both of New York.
-Continental Mining & Oil Corp.,/..
v't7;77 7
★ Camoose Uranium Mines of
Dec. 9 (letter of notification) 250,000 shares of common
America, Inc.
Jan. 9 filed 3,000,000 shares of common stock (1 cent
stock (par 10 cents).
Price—$1 per share. Proceeds—
For mining expenses.
par), all owned by Camoose Mines Ltd., which is in
Office—1500 Massachusetts Ave¬
liquidation and has equivalent amount of stock out¬
nue, N. W., Washington, D. C. Underwriter—E.L. Wolfe
standing (1 cent par). Camoose Mines will issue as a
Associates, 1511 K St., N.W., Washington, D. C.
liquidating dividend, on a share-for-share basis, the
★ Corn Belt Packing Co.
/
' 7
■
73,000,000 Canadian Uranium Mines shares it owns. Office
7 March 6 (letter of notification) 100,000 shares of com¬
—New York City.
Underwriter—None.' Statement ef¬
mon
stock (par $1); and $200,000 principal amount of
fective March 5.
*
'
,/
7% first mortgage bonds due serially Jan. 1,;1974 to
Jan. 1, 1984 (in denominations of $100). Price—At par-.
★ Campbell Chibougainau Mines Ltd.
March 10 filed 606,667 shares of capital stock (par $1),
Prceeds—To purchase land and building equipment and
of which 506,667 were issued in connection with the ac¬
operating capital.
Office—205 Laub Block, Denison,
Iowa.
quisition of all the assets of Yorcan Exploration Ltd.
Underwriter—None.
7
.7
7 /
V 7
;
(latter proposes to distribute said shares ratably to its
Counselors Research Fund, Inc., St. Louis, Mo;
stockholders of record Dec. 16, 1957); The remaining
Feb. 5 filed 100,000 shares of capital stock, <par one

Proceeds — To
discharge current liabilities and to drill ten wells. Un¬
Price—Xo be supplied by amendment.

•

derwriters—To be named by amendment.

•A-American Electronics, Inc. (3/31-4/4)
6 filed $3,500,000 of
convertible subordinated
debentures
due
1973 and 80,000
shares of common

March

(par $1). Price—100% of principal amount for
debentures; and at price to be supplied by amendment
for common stock. Proceeds—$148,000 to retire the 6%
stock

debentures

Taller

Cooper, Inc., a subsidiary;

$2,-

250,000 to reduce bank loans; and the balance for work¬

ing capital and other corporate purposes. Underwriters
Co., San Francisco, Calif.; Van Alstyne,
Noel & Co., New York, N. Y.; and Crowell, Weedon &
Co., Los Angeles, Calif.

—Dean Witter &

-k American Investment and Income Fund, Inc.
11, filed $5,000,000 of investment plans for the

March

accumulation of shares in this Fund.
Proceeds—For

investment.

Price—At market.

Office—Washington,

Underwriter—None.

American Life & Casualty Insurance Co.

Dec. 3 filed 101,667 shares of common stock
be offered for

subscription by

common

(par $1) to
stockholders at

the rate of

share for each two shares held; un¬
subscribed shares to be offered to public. Price—$10 per
one new

share. Proceeds—For capital and surplus accounts. Office

100,000 shares

—Fargo, N. D. Underwriter—None.
American Mutual Investment Co., Inc.

share. Proceeds—For investment in first trust notes,
second trust notes and construction loans. Company may
develop shopping centers and build or purchase office
buildings. Office— 900 Woodward Bldg., Washington,
D. C.. Underwriter — None.
Sheldon Magazine, 1201
Highland Drive, Silver Spring, Md., is President.
per

15,

one

1957, filed 50,000,000 shares of common stock
cent). Price — $2 per share. Proceeds — For
working capital and general corporate purposes. Office
—Dallas, Tex. Underwriter—Peoples Securities Co., J.
D. Grey, of New Orleans, John S. Tanner, of Dallas,
and C. L. Edmonds, of Houston, three of the 22 direc¬
tors, are Chairman, Vice-Chairman and President, re¬
spectively.
Anderson Electric

ronto

Stock

are

to be sold for the account of the Estate

derwriter—None.

★ Campbell Pre-Fab Inc.
3 (letter of notification)

March
mon

stock.

50,000

■

shares of

Street,

West

Middlesex,

Pa.

Corp.

Carolina Power & Light Co.

Underwriter—To

com¬

Underwriter—

Probable

Central Mortgage & Investment Corp. ~
Sept. 12 filed $5,000,000 of 20-year mortgage bonds and
500,000 shares of common stock (par five cents) to be

Andes

Copper Mining Co.
Feb. 6 (letter of notification) 6,277 shares of class B
capital stock being offered to minority stockholders at
rate

share of class B stock for each six shares of

one

capital stock (par $14) held as of Feb. 28, 1958; rights
to expire on March 18.
Price—At par ($25 per share).
Proceeds—To pay outstanding obligations to Anaconda
Co., the parent, for funds advanced. Underwriter —
None.

Bankers

Underwriter—Selected Se¬

Fidelity Life Insurance Co.

Feb. 28

777..,:,

★ Century Shares Trust, Boston, Mass. i
4 filed
(by amendment) an additional 150,000
shares of capital stock (par $1). Price—At market. Pro¬

Jean

Bankers
Feb.

Management Corp.,
400,000 shares of common stock

filed

(par

Price—$1 per share.
Proceeds—To reduce out¬
standing indebtedness and for working capital. Office—
Houston, Texas. Underwriter — McDonald, Holman &
Co., Inc., New York.
Bishop Oil Co., San Francisco, Calif. (3/21)
112,565 shares of common stock (par $2) to
be offered for subscription by common stockholders of
record March 20, 1958, on the basis of one new share
for each five shares held; rights to expire on
April 3.
Feb. 27 filed

Price—To be

supplied by amendment. Proceeds—For re¬
loans, expansion and general corporate
Underwriter—Hooker & Fay, San Francisco,

duction of bank
jr«-^oses.

Calif.

$1).

A common stock (par
Price—$2.50 per share. Proceeds—For investment.
and development of real property,

Business—Purchase
:

and

•

(letter of notification) 3,333 shares of common
stock (par $1). Price—$30
per share.'Proceeds—To go
to a selling stockholder.
Office — 5800 Pawnee Road,
Wichita, Kan. Underwriter—Francis I. du Pont & Co.,

lanta, Ga.

cents.)

Disc, Inc., Washington, D. C.

acquisition of stock of business enterprises. Under¬
Irving Lichtman is President and Board

Chairman.

★ Cessna Aircraft Co.

May 14 (letter of notification) 600,000 shares of common
stock (par $1—Canadian).
Price—50 cents per share

Underwriter—None.

writer—None.

March 3

Wichita, Kan.

Chess Uranium Corp.

(U. S. funds). Proceeds—For exploration costs, etc. Of*
Montreal, Canada. Underwriter—
Inc., 160 Broadway, New York.

fi®®—5616 Park Ave.,
R. Veditz Co.,

★ Cincinnati
Gas & Electric Co.
Feb. 20 filed 450,923 shares of common stock

(.par $8.50)
being offered for subscription by common stockholders
of record March 11,
1958, on the basis of one new share
for each 16 shares
held; rights to expire on March 26.
Price—$28.50 per share. Proceeds—For construction and
improvements, to repay bank loans, and for other cor¬
porate purposes. Underwriters—Morgan
Stanley & Co
W. E. Hutton

Oct. 10 filed 400,000 shares of class

filed 258,740 shares of common stock
(par $1),
which 125,000 shares are to be offered
publicly and
133,740 shares to employees pursuant to stock purchase
options. Price—To public, $6 per share. Proceeds—For
expansion and other corporate purposes.
Office — At¬
of

March

Digitronics Corp*.
(letter of notification) 140,000 shares of class B
capital stock (par 10 cents). Price — $1.50 per share.
Proceeds—For general corporate purposes. Office—Albertson Avenue, Albertson, Long Island, N. Y, Under¬
writer—Cortlandt Investing Corp., 135 Broadway, New
York 6, N. Y.
— < >•
•
"
< / - 7"
•./77; 7:

investment.

St.

Feb. 12

Beach, Fla. Under¬
Corp., New York. Offering,

Corp.,

Office—Miami

Securities

Date indefinite.

ceeds—For

Anita Cobre U. S. A., Inc., Phoenix, Ariz.
Sept. 30 filed 85,000 shares of common stock. Price—At
par ($3.75 per share). Proceeds—For investment in sub¬

sidiary and working capital.
curities, Inc., Phoenix, Ariz.

business.

writer—Aetna

Sales

Robert H. Green is President.

Diapulse Manufacturing Corp. of America : . Jan. 29 (letter of notification) 150,000 shares of commop
stock (par 10 cents).
Price—$2 per share. Proceeds—
For general corporate purposes. Office—276 Fifth Ave.,
New York, N. Y7 Underwriter—None.

offered in units of $100 of bonds and 10 shares of stock.
Price—$100.50 per unit. Proceeds—For purchase of first
mortgages or to make first mortgage loans and for con¬
struction

Proceeds—For. investment.

Daybreak Uranium, Inc., Opportunity, Wash.7
filed 1,156,774 shares of .common stock (par 10
cents), of which 630,000 shares are to be offered fpr acT
count of company and 526,774 shares for selling stocky
holders.
Price—At market.
Proceeds—For exploration
and drilling costs and other corporate purposes. Under¬
writer— Herrin Co., Seattle, Wash.
..
/ 7 '

bidders:

—To go to selling stockholders.
Office — 700 N. 44th
Street, Birmingham, Ala. Underwriters ■— Cruttenden,
Podesta & Co., Chicago, 111.; and Odess, Martin & Herzberg, Inc., Birmingham, Ala.

common

;

Jan. 29

(3/18)

determined by competitive
Halsey, Stuart & Co. Inc.;
Kidder, Peabody & Co. and Merrill Lynch, Pierce, FenTier & Smith
(jointly); Lehman Brothers; Blyth & Co.,
Inc.; W. C. Langley & Co. and The First Boston Corp.
(jointly); Equitable Securities Corp.' Bids—To be re¬

bidding.

market.

Counselors /Research

Explorers, Ltd.
- y-(
Oct.. 28 (letter of notification) 600,000 shares of common
stock (par $1-Canadian). Price—50 cents per share-U. S.
funds.
Proceeds — For exploration and drilling costs.
Office — Suite 607, 320 Bay St., Toronto, Ont., Canada.
Underwriter—Stratford Securities Co., Inc., 135 Broad¬
way, New York.
Offering—Postponed indefinitely.

Feb. 17 filed $20,000,000 first mortgage bonds due 1988.
Proceeds—To repay bank loans and for construction pro¬
gram.

—

Cubacor

Price—At par ($1 per share). Proceeds—For
of building and working capital.
Office—

ceived up to 11 a.m. (EST) on March 18 at Room 2033,
Two Rector St., New York 6, N. Y.

Louis.

construction

Carbaugh

* Price—At

Underwriter

-"7

(letter of notification) 14,700 shares of class B
stock (par $1). Price—$12 per share. Proceeds

Dec.

cent).

None.

American Provident Investors Corp.

(par

Collings Henderson on the American and To¬
Exchanges. Price—At market. Proceeds—
To selling stockholders.
Office—Toronto, Canada. Un¬

Dec. 17 filed 490,000 shares of capital stock. Price—$10.20

Feb.

of A.

Co., and Blyth & Co., Inc., all of New

York.

Dixon Chemical &

Research, Inc.

Dec. 24 filed 165,625 shaies of common stock (par $1) t6
.be offered for subscription by common stockholders at
the

rate

Price—To

one

new

for

each

four

snares

held.

supplied by amendment. Proceeds—Fof
expansion and general corporate purposes.
Uffice —
Clifton, N. J.
Underwriter—P. W. Brooks & Co., Inc.,
New York. Offering—Indefinitely postponed. Other fi¬
nancing may be arranged.
•
Dresser

Industries, Inc.
128,347 shares of common stock *(par 500)
to be offered in exchange for outstanding common stock
of the Elgen Corp. on the basis of one share of Dresser
Industries common for 3.4 shares of Elgen's common.
Feb. 28 filed

exchanges will be made unless, the exchange
accepted by the holders of at least 80% of the
standing Elgen common, and Dresser will not fee
gated to consummate any exchanges unless the
is accepted by the holders of at least 95% of the
standing Elgen common.
Underwriter—None.
is

offer
out¬

obli¬
offer
out¬

Duquesne Light Co. (4/9)
12 filed $15,000,000 of first mortgage feonds, due
1988. Proceeds—To repay bank loans and for
construction program. Underwriter—To be determined

March

★ Cities Service Co., New York
March 10 filed $11,250,000 of participations in
company's
employees thrift plan, together with 250,000 shares of
common

stock

(par $10) which

the provisions of the plan.

may

be purchased under

April 1,

by competitive bidding.

Probable bidders: Halsey, Stu¬
Inc.; The First Boston Corp.; White, Weld &
Co.; Glore, Forgan & Co.; Kuhn, Loeb & C04 Eastman

art & Co.

Volume 187.

Number 5724

...

The Commercial and Financial Chronicle

Dillon, Union Securities & Co., and. A. C. Allyn & Co.
Inc.;.(jointly)/'Drexel: & Co. and Equitable,' Securities
Corp. '(jointly) ." Bids—Tentatively expected to be re¬
ceived on April 9. *•
,>n ■■"'■*
v-

investment.v-

.5?V-/

Ethodont

Feb.
At

and

par" ($5

; 7

;;'

Ex-Cetl-O Corp., Detroit, Mich.
Nov.; 25 filed 88,000 shares of common

Price—

to be offered

in exchange for

Chucking Grinder
four-tenths of

Co.

JS-.y

■-

■

ceeds—To

(par $3)

rate

Ex-Cell-O share for. each full Bryant
Offer will become effective upon acceptance by

share.

•

York

the

holders of not less than 209,000 shares'(95% ) of all com¬
mon stock of Bryant
outstanding; Underwriter—None.

Co.

A'-—i

.nnr.

,nn

$600

unit.r-

Proceeds—For construction of plant, working capital and
corporate purposes.-- Underwriter—Minor, Mee &

other

wf-'V

Co., Albuquerque, N. M.
•

Famous Virginia Foods Corp.
Jan. 30 (letter of notification) 19,500 shares of common
stock

(par $5) and-390

offered

mn/]n

4-Uma.i rtl.

"Washington, D. C.

—Scheduled
March

Jefferson

subsequently withdrawn.

Washington,
/ -'

Tennessee Gas

drilling

Bldg,, Mt. Vernon,
Co., Miami, Fla.

111.

ing, if

pro

rata

Tennessee Gas

(Stone
;

-Office—316

expenses.

Underwriter—Paul

Davis

&
.

basis; thereafter the balance remain¬

will be offered to the public. Price—$5 per
share to stockholders; and to the public at a price to be
determined.
Proceeds
For expansion ancl other cor¬

Securities

Weld & Co.)

March 19

Dillon,

be offered to

Price—$10

if Fidelity Fund,-Inc.,
shares

Read

&■

and

(Bids

White,

April 14

is to be offered to

ance

Price—$10

per

share.

Bonds

$25,000,000

Telephone

Georgia
/

\ (Bids

Reichhold

Co.-

* (Blyth' &

EST)

a.m.

Common

$24,000,000

Bishop

-———Common

Inc.)

Co.,

Oil

Co.—

112,565

...

Co., Washington, D. C

Merck &

200,000

Feb. 27
due

11:30

.(Goldman,

New

(Monday)

Common
Co.)

225,000

(Tuesday)

invited)

Stepan Chemical Co
(White,

$30,000,000

Common

Weld & Co.) .203,000 shares

filed

Corp,

(3/24)

(Bids to be

Northwest

March
American

accounts

receivable,

for

research

for other general corporate pur¬
poses. Office—Brooklyn, N Y
Underwriters—Alfred L
Powell Co., New York; and H. Carroll & Co., Denver.

and

development

and

Colo.

Electronics,

(Dean Witter & Co.;

Equip. Trust Ctfs.

Witter

Crowell,

Union

Co.;

Co.)

Eastman

Dillon,

Union

Inc.__

Inc.) $10,643,000

11 'a.m.

Noel & Co.;
$3,500,000

to be invited)

Noel & Co.

80,000

(Bids to be Invited)

April

Idaho

Power

Co
be

invited)

-Bonds

$30,000,000

(Tuesday)
Bonds

EST) $40,000,000

noon

invited)

May 19

(Bids

(Monday)
Bonds

invited)

$20,000,000

/..Common

invited)

250,000

Illinois Power

(Tuesday)

(Bids

Bonds

invited)

$25,000,000

May 21
Union

(Wednesday)

Gas

Co—
3

June

'Tuesday)

Appalachian Electric Power Co
(Bids to be invited)

Debentures

$10,000,000

Bonds
$22,000,000

June

Brunswick-Balke-Collender
(Offering

stockholders—to

Brothers

and Goldman,

General Amer.

Debentures

underwritten

Transportation Corp

Lehman

(Tuesday)

Union Securities &

June

invited'

Bonds or Debs.

«25O0O 000

(Wednesday)

New England Power Co
(Bids

invited)

Bonds
$10 000,000

Eq. Tr. Ctfs

July 1

$20,000,000

Petroleums Ltd

(Eastman Dillon,

Sachs & Co.) $8,593,200

(Kuhn, Loeb & Co.)

Pacific

Bids

(Wednesday)

Bonds

$25,000,000

Virginia Electric & Power Co
April 2

Bonds

$12,000,000

Gulf States Utilities Co

Brooklyn

$10,000,000
—

(

May 13 (Tuesday)

Bonds

$30,000,000

(Tuesday)

be invited)

$3,000,000

Gas Improvement

and

Bonds
to

Barney

•

'Bids

Smith

•

(Monday)

May 20

Idaho Power Co._
-

and

Bonds

(Bids to be invited)

April 1

Barney

and

Common

EST)

Co.

120,000

Gulf States Utilities Co

Wisconsin Electric Power Co.-.
(Bids

Smith,

Puget Sound Power & Light Co

Debentures

Co.)

and

—Common

Securities

Co.)

April 28

Preferred

Van Alstyne,

Preferred
Co.

$5,000,000

Atlantic City Electric Co.-

(Bids

(Monday)

Bonds

$50,000,000

__Bonds

Securities

United

Van Alstyne.

Weedon

(Tuesday)
EST)

a.m.

invited) $10,000,000 to $20,000,000

(Bids

Electronics, Inc

(Dean

about $8,000,000

City Electric Co.Dillon,

$50,000,000

$3,435,000

Crowell, Weedon & Co.)

American

(Bids

inventory

to be

(Bids

Forest

Laboratories, Inc.
Aug. 28 filed 200.000 shares of capital stock (par 10
cents). Price—$2 50 per share. Proceeds—For sales pro¬
motion of company's products, working capital, addi¬

(Monday)

invited)

(Bids

stock

(par 25
cents). Price—$3 per share. Proceeds—For exploration
work ami working capital.
Office — Portland, Ore.
Underwriter—To be named by amendment. Sol Gold¬
berg is President.

tional

(Eastman

(Friday)

Bancorporation

April 23 (Wednesday)

Equip. Trust Ctfs.

invited)

Common
57,362

Atlantic City Electric Co—

(Thursday)

(The First Boston Corp. and Blyth & Co.,

common

(Bids

Debentures

Baltimore & Ohio RR.—L

of America

470,000 shares

Preferred

March

Bonds

$15,000,000

EST)

stockholders)

to be

(Wednesday)

March 28

for other corporate purposes. Under¬
determined by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Merrill
Lynch, Pierce, Fenner & Smith and Kidder, Peabody &
Co. (jointly); The First Boston Corp.
Bids—To be re¬
ceived up to 11:30 a.m. (EST) on March 24 at Room
2033. Two Rector St., New York 6, N. Y.

a.m.

Sierra Pacific Power Co

Pierce, Fenner & Smith and Blyth & Co., Inc.)

stock

gas facilities and
writer — To
be

Dec.

(Bids

(Offering to stockholders—to be underwritten by Merrill Lynch,

$20,000,000 of first mortgage .bonds, series
Proceeds—To provide additional electric and

Fluorspar Corp.

11:30

shares-

$7,600,000

(Offering to stockholders—to be underwritten by Morgan Stanley
■f
& Co.
and Reinholdt & Gardner)
$5,304,950

Oil

about

Southern Pacific Co

Atlantic

Debentures

Ocean Drilling & Exploration Co

Richfield

968,549

$20,000,000

Jersey Bell Telephone Co
to

invited»

Consolidated Edison Co. of N. Y, Inc

Common

Equip. Trust Ctfs/
invited)

Sierra Pacific Power Co

Bonds

EST)

a.m.

Sachs

'Bids

filed

1988.

April 21
-Common

Co., IncL—!

Florida Power & Light Co.

Bonds

$50,000,000 to $60,000,000

April 22
March

purchase
&

Philadelphia Electric

(par five cents).- Price — $5 per share. Proceeds — To
properties. < Underwriter — Whitmore, Bruce

April 16 (Wednesday)
Mississippi Power & Light Co

(Friday)

—

March 26

capital and surplus and for first year's deficit; Office—
3395 S. Bannock St., Englewood, Colo. Underwriter —
American Underwriters, Inc., Englewood, Colo
Nov.

(Bids

(Offering to stockholders—underwritten by Hooker & Fay)

First International Fire Insurance Co.

Leaseback Corp., Washington, D. C.
filed 500,000 shares of class A common

invited)

(Bids

Inc

'March

Un¬

Aug; 26 (letter of notification) 100,000 shares of common
stock (par $1). Price — $3 per share. Proceeds — Foi

First

Northern Pacific Ry

Bond®

Chemicals,

Mass.

Proceeds—For investment.
Boston, Mass.

(Offering to stockholders—bids

derwriter—the Crosby Corp.,
.

(Bids

$182,325

Power Co
•

March 25

of-investors.

$45,000,000

(Tuesday)

Commonwealth Edison Co

Common

(Bids

limited number

(Monday)

April 15

(Offering to/stockholders—to be underwritten by Eastman
Dillon, Union Securities & Co.) 71,200 shares

/.(Bids

Boston,

invited) $15,000,000

(Bids to be invited)

(Thursday)

Inc.,

New England Telephone &
Telegraph Co—Debens.

Florida Power & Light Co

Feb. 6 filed 20,000 shares of capital stock/of which 10,000 shares were previously sold privately and the bal¬

$3,000,000

(Wednesday)

New England Electric System

Un¬

Boston, Mass.

Fund,

Bonds

(Offering

(by amendment) an additional 3,000,000
$1).
Price — At market.

Fidelity Trend

page

Savannah, Ga.-_Com.

Duquesne Light Co

Preferred

Corp.

Co., Inc.)

March 20

Commonwealth

limited number of investors.

of capital stock (par
Proceeds—For investment.
,

OALERDAR

$20,000,003

-'V-

share. Proceeds—For investment.
Crosby Corp., Boston, Mass.

per
derwriter—The

March 10 filed

150,000 shares of class A
Price—$2 per share. Pro-

stock (par 10 cents).

April 9

(Wednesday)

Room

Debentures

Willcox & Gibbs Sewing Machine Co
(Offering to stockholders—no"" underwriter)

Under\vrte*f—None.

Fidelity Capital Fund, Inc., Boston, Mass.
Feb. 6 filed 20,000 shares of capital stock,, of which 10,000 shares were previously s®ld privately and the bal¬
ance

(EST)

a.m.

April 8 (Tuesday)

Texas Eastern Transmission Corp

—

purposes.

Services, Inc.,

(Offering to stockholders—no underwriting)

Transmission Co
Webster

''.v.

;

Rogers

any *

porate

Southern

Citizens & Sou. Natl. Bank of

(Scone & Webster Securities! Corp:; White, Weld &
Co., Inc.;
and Halsey, Stuart & Co.
Inc.) $30,000,000

■

it Fidelity Bankers Life Insurance Corp.,
Richmond, Va. '
v.5
March ;? filed 450,000 shares of common stock (par $1)
tp be offered for subscription by holders of outstanding
stock

Continued

gas

received

Glassheat Corp.
(letter of notification)

common

Bonds

Transmission Co.—*

V»

;

Drilling Co.
Fej>. 3 (letter of notification) 150,000 shares of common
stock (par five cents). Price—$2 per share.
Proceeds—
and

office

(Tuesday)

Carolina Power & Light Co.*
,,' * V v
(Bids 11 a.m. EST) $20,000,000

Farrar

oil

Feb. 12

ISSUE
March

...„

St., Lynchburg.

Underwriter—Whitney & Co., Inc.,

For

1600, 250 Park Avenue, New York
17, N. Y.

Letter

(jointly); Equitable Securities Corp. and
Dillon, Union Securities & Co. (jointly). Bids

Eastman

stock

Virginia Foods Corp.
iNov. 6
(letter of notification) 5,000 shares of common
stock.. Price—-$6.67
per
share.
Proceeds—To selling
Office—922

March

1988,

Shields & Co.

Electronics Distributors Inc.
(letter of notification) 2,090 shares of common
stock (par $25) to be offered to stockholders until
May,
1958, then to the public. Price—$42 per share. Proceeds

Famous

stockholder.

(3/20)
$24,000,000 first mortgage bonds due

Proceds — To finance construction
program.
Underwriter—To be determined by
competitive bidding.
Probable bidders:
Halsey Stuart & Co. Inc.; Morgan
Stanley & Co.; Lehman Brothers; The First Boston
Corp.; Blyth & Co., Inc.; Kidder, Peabody &
Co., and

General

Feb.

Webster

Georgia Power Co.

J..1.

Feb. 21 filed

Offering to be made through selected dealers
Application is still pending with SEC.

and-- one
warrant;,- Price—$500 per unit. - Proceeds—For equip¬
ment and working capital.
Office—922 Jefferson St.,
Lynchburg, Va.; Underwriter — Whitney & Co., Inc.,
•

(jointly);

stock purchase warrants

common

units

fnrir,

named.

con¬

determined by

Securities

Credit, Int., Washington, D. C.
Aug. 17, 1956 filed $2,000,000 of 6% subordinated sinktng fund debentures, due Sept. 1, 1971, with detachable
warrants to purchase 160,000 shares of
participatinf

nOmfiri

due 1960-1964 to be offered in units of
of notes and 200 shares of stock.
Price—$1,000 per

Underwriter—May be

Paine, Webber, Jackson & Curtis and
Securities Corp. (jointly); Equitable
Corp. Bids—Were to have been received
up
to 8 a.m.
(PST) on March 12, but offering has been
postponed.
I
"

Stone

preference stock, to be offered in units of $500 of deben¬
Expanded Shale Products^ inc.; Denver, Colo.
Jan. 29 filed 60,000 shares of common stock
tures and 40 warrants; Price—$500
(par $1) and
per unit. Proceeds—
$180,000 of 6%,callable unsubordinated unsecured deben-For expansion and working capital Underwriter—None
ttrre notes

of California

$20,000,000 of first mortgage bonds, series

competitive hidding. Probable bidders:
Halsey, Stuart
& Co. Inc.;
White, Weld & Co. and Kidder, Peabody &

(par $1). Pro¬
United States

General

Telephone Co.

filed

struction program.

(EDT) on Maj
654, 101 Indiana Ave., N. Wi, Washington 21
C., but bidding has been postponed....

L, due 1988. Proceeds—To repay bank loans and for

Corp., New York

the-Attorneys General

General

Feb.

13 at Room
(

New

—

Corp.,, New York City

Underwriter—To be determined by competitive
bidding
; Probable
bidders: Blyth & C0.7 Inc., and The First Bos¬
ton Corp. (jointly);
Kuhn, Loeb & Co., Lehman Brotheri
and Glore, Forgan & Co.
(jointly). Bids —Had beei
♦scheduled to be received up to 3:45
p.m.

common stock of Bryant

Springfield; Va.,

Office

loans

payable to bank, inventory and working
Office—735 Main Street,
Wheeling, W. Va. Un¬
der writer-^None.

■

,.'ystock

Securities

General Aniline & Film

.share).

per

Underwriter—None.:

stock.

—For

capital.

fan. 14^ filed 426,988 shares of common A stock
(no par)
-and 1,537,500 shares of common B stock

Proceeds—^Tov cover operating
during the development period of the corpora¬

expense

tion.

market,^Proceeds—For.
'■ ■■:■
•;

common

general corporate -purposes.

Underwriter—Harris

%«?.:.

shores of

Inc.

notification)<100,000 shares of common
(par 10 cents). Price—$3 per share. Proceeds—To
reduce accbunts payable, etc., and for
working capita)

stock

Laboratories, Berkeley, Calif.1

filed 300,000

Freeman Electric Construction
Co.,

Nov. 27 (letter of

★ Eaton & Howard Balanced Fund, Boston, Mass.
March 3 filed (by amendment) an additional
500,000
trust shares (par $1)., Price—At

r(1191)

Debentures
Co.) $30,000,000

(Tuesday)

Florida Power Corp
(Bids

Bonds
be

invited)

$25,000,000

The Commercial and Financial Chronicle

(1192)

Continued from page

/7
ceeds—For general corporate purposes. Office—1 E. 35th ~
Street. New York 16, N. Y.r Underwriter—James An¬
thony Securities Corp., 37 Wall St., New York 5, N. Y.
,,

it Gly Inc.
(letter of notification) 300,000 shares of com¬
mon stock (par 30 cents).
Price—$1 per share. Proceeds

Lefcourt Realty Corp., New York
29 filed 250,000 shares of common stock

Price—To be supplied by amendment. Proceeds
of property in Florida. Underwriter
—Frank M. Cryan Co., Inc., New York.
Lorain Telephone Co., Lorain,

acquisition, development and operation of oil
properties. Office—Bacon Bldg., 5th & Pine
Sts., Abilene, Texas. Underwriter — Barth Thomas &
Co., Inc., New York.
1
■/,•••,'. 7;

—For
and

gas

Great Divide Oil

Corp.

of notification) 300,000 shares of common
cents). Price—$1 per share. Proceeds—
To pay balance on oil and gas properties, and unsecured
notes and for drilling and working capital. Office—207
Newhouse Bldg., Salt Lake City, Utah.
Underwriter—
Birkenmayer & Co., Denver, Colo

Oct. 11 (letter
stock (par 10

Guardian Insurance Corp.,

Baltimore, Md.

Aug. 16 filed 300,000 shares of common stock, of which
200,000 shares are to be publicly offered and the remain¬
ing 100,000 shares reserved for issuance upon exercise
of warrants which are to be sold at 25 cents per warrant-

incorporators, management, and/or direc¬
tors. Price—$10 per share. Proceed*—For working cap¬
ital and general corporate purpose*
Underwriter—None

to organizers,

Ltd., Honolulu, Hawaii
Feb. 18 filed $1,250,000 of convertible subordinated de¬
bentures due April 1, 1973, of which $1,000,000 principal
amount will be offered for subscription by stockholders
at the rate of 100 of debentures for each 35 shares held;
Airlines

Hawaiian

$100,000 of debentures will be offered to employees; and
§150,000 to others. Price—At principal amount. Proceeds
—To be used to buy new airplanes* to repay certain
short-term bank loans, and

for other corporate purposes.

Underwriter—None.

„

Nichols, Inc., Exeter, N. H.

Co., Inc. (3/24-25)
225,000 shares of common stock (par
16'% cents). Price—To be supplied by amendment. Pro¬
ceeds—To selling stockholder.
Underwriter—Goldman,
Sachs & Co., New York.
7
,
filed

Merrimack-Essex

redeem

Nortex Associates

Inc., Dallas, Texas ■
participating interests in 1958
exploration program. Interests are to be
offered for public sale in $10,000 units. Proceeds—For
exploration and development of gas and oil properties.
Underwriter—None.
" 7
oil

series

Proceeds—Together with other funds, to

C, due 1988.

like amount of 5%% series B bonds due 1987.

Underwriter—To be determined by competitive bidding.

ferred

bidders:

Kidder, Peabody & Co. and White,
Weld & Co., (jointly); Halsey, Stuart & Co. Inc.; First
Boston Corp.; Merrill Lynch, Pierce, Fenner & Smith,
and Eastman Dillon Union Securities & Co. (jointly).
Bids—Which

were

to have

been

received

March

St., Boston 16, Mass., have been indefi¬
nitely postponed.
Mineral

Price

mining

Basin Mining Corp.

Dec. 30 (letter of
stock.

•

Minnesota

Jan.

Feb.

Mines, Ltd.
(letter of notification) 300,000 shares of com¬
Price—At par ($1 per share). Proceeds—

Nov.

mon

stock.

repay loan, to purchase equipment and machinery
•nd for working capital.
Office—1551-A Eglinton Ave.

West, Toronto 10, Ont., Canada.
&

Co., Inc., Buffalo, N
Idaho

Underwriter—D'Amico

Power

Co., Boise, Idaho (4/1)
March 6 filed $10,000,000 of first mortgage bonds, due
April 1, 1988, and $10,000,000 of sinking fund debentures
due April 1. 1983.
Proceeds — To repay bank loans.
Underwriter—To be determined by competitive bidding.
Probable

bidders:

Co.,

and

Halsey, Stuart & Co. Inc.; Blvth &
Freres & Co. (jointly); Kidder,
Peabody & Co. and White, Weld & Co. (jointly); Salo¬
mon Bros. & Hutzler and Eastman Dillon, Union Secu¬
rities & Co. (jointly); Merrill Lynch, Pierce, Fenner &
Smith; Equitable Securities Corp. Bids—Expected to be
Inc.

received

Lazard

April

working capital and to enlarge research and
development department. Underwriter — S. D duller &

it Institutional Shares,

■

;

Ltd., New York

March 5 filed 100 shares each of four different series of
securities.

Price—At market.

Proceeds—For investment.

★ Iron Fireman Manufacturing Co.; Portland, Ore.
March 10 filed voting trust certificates for 378,000 shares
of

common

stock.

Janaf, Inc., Washington, D. C.
July 30 filed $10,000,000 of 5%-8% sinking fund deben¬
tures due Aug. 1, 1972 and 100,000 shares of common
stock (par 20 cents) to be offered in units of a $1,000
debenture and
and

one

per

10 shares

share of stock

stock,

Price—Par for debenture, plus

share for each 10 shares of Stock

eonstruction of

$100 debenture
Proceeds—For

shopping center and other capital im¬
provements; for retirement of present preferred shares;
•nd for working capital, etc. Underwriter—None
a

Kaar

Engineering Corp.
Feb. 12 (letter of notification) $250,000 of 6V2% con¬
vertible 15-year sinking fund
debentures, due Jan. 1,
.1973, to be offered for subscription by preferred stock¬
holders

the

rate

$3 of debentures for each pre¬
ferred share
(par $10) held.
Price—At par
(in de¬
nominations of $1,000 and $500), plus accrued interest
from Jan. 1, 1958.
Office—2995 Middlefield Road, Palo
Alto, Calif. Underwriter—None.

Keystone
I

Beryllium Corp.

mon

stock.

Price—At par ($1 per share).

Oil &

com¬

Proceeds—For

Operations, Inc.'
notification) 100,000 shares of common
(par $1). Price—$2.50 per share. Proceeds—For
development of oil and mineral properties. Office—208
Wright Bldg., Tulsa, Okla. Underwriter—Universal Se¬
curities Co., 201 Enterprise Bldg., Tulsa 3, Okla.

stock

it O. T. C. Enterprises Inc.
Jletter of notification) 23,200 shares of com¬
class B stock (par $1). Price—$5 per share. Pro¬
ceeds—For completion of plant plans: land; construc¬
tion and operating expenses.
Office—2502 N. Calvert
St., Baltimore 18, Md.
Underwriter—Burnett & Co.,
Sparks, Md.
-

10,000 shares of 7% cumulative convertible preferred,
publicly at a unit price of $101, representing
one share of preferred and two shares of common. Pro¬

March 6
mon

ceeds—To be invested in the stock of Motels Americano,
an
Italian organization.
Office—Silver Springs, Mary¬

Underwriter—None.

Multnomah Canadian

Fund, Ltd., Vancouver, B. C.
Jan 31 filed 1,000,000 shares of class A common stock
(par $1). Price—At market. Proceeds—For investment.
Business—Investment company, with Spencer R. Collins
of Eugene, Ore., as President.

it Pacific Petroleums Ltd., Calgary, Canada (4/2)
March 12 filed $30,000,000 of 15-year sinking fund de¬
bentures due 1973.
Price—To be supplied by amend¬
ment. Proceeds—For repayment of bank loans and for
general corporate purposes.
Underwriter — Eastman
Dillon, Union Securities & Co., New York. .J
./.*•

Municipal Investment Trust Fund, Inc. (N. Y.)
May 9 filed 5,000 units of undivided interests in Munic¬
ipal Investment Trust Fund, Series A. Price—At market.
Proceeds—For investment.
Sponsor—Ira Haupt & Co..

Parnat

(by amendment)

Distributor

ment.

interest

—

the

Trust.

Mutual

Proceeds—For

★ Penn Square Mutual Fund, Reading, Pa.
»
100,000 shares of beneficial interest. Price

Distributors,

March 5 filed

invest¬

Inc.,

—At market.

Kansas

•

it National Beverages Inc.
(letter of notification) 90,000 shares of common
stock (par $1).
Price—$2.50 per share. Proceeds—For
working capital, expansion and equipment.
Office—
3030 S. 6th W., Salt Lake City, Utah.
Underwriter—

Natural Gas Pipeline Co. of America
1977.

Read

Price—To
reduce

Co.

of New York.

Irw

be supplied

bank

loans.

.•

Pro¬

—Dillon,
'

<\,

Offering—Temporarily postponed,

both

filed

1,000,000 preorganization subscriptions to

voting common stock and 250,000 preorganization
subscriptions to class B non-voting common stock to be
offered

in units of four class A

shares and

one

class B

the purchaser agreeing to donate each class B
share to the Peoples Security Foundation for Christian
Education, to be incorporated as a non-profit corpora¬
tion. Price—$2 per share. Proceeds — For capital and
surplus to finance a proposed insurance company to be
named Peoples Security & Endowment Co. of America,

share,
i

by amendment.

Underwriters

class A

Nov. 19 filed $40,000,000 of first mortgage pipeline bonds

Underwriter—

Reading, Pa.

Peoples Security Investment Co.

Oct.

Feb. 25

None.

Proceeds—For investment.

J. L. Hain & Co.,

City, Mo.

due

Corp.

Underwriter—Darius Inc., New York.

additional $5,000,000

periodic purchase plans for accumulation of shares of

beneficial

Machines

(letter of notification) 60,000 shares of common
stock (par $1). Price — $5 per share.
Proceds — For
working capital. Office—1816 Boston Rd., Bronx, N. Y.

New York.

March 10 filed

business

Feb. 25

it Mutual Trust, Kansas City, Mo.

ceeds— To

Office—Suite 525, University Building,
2, Colo. Underwriter—Mountain States Secu¬
rities Corp., Denver, Colo.

Mineral

Nov. 4 (letter of

to be sold

minm? expenses.

Co., New York and Reinholdt & Gardner, St. Louis, Mo.

purchase of land, construction and working capital.

Denver

one preferred share for each 14 common shares held;
rights to expire April 9. Price — To be supplied by
amendment. Proceeds—To repay bank loans, construc¬
tion of a new drilling barge,
and for other general
corporate purposes. Underwriters — Morgan Stanley &

Jan. 14 filed 20,000 shares of class A common stock and

;

Feb. 14 (letter of notification) 270,700 shares of

{

Underwriter—Southeastern Securities Corp., New York.

land.

it Ocean Drilling & Exploration Co.,
New Orleans, La.' (3/26)
' /
March 6 filed 106,099 shares of cumulative. preferred
stock (par $50) to be offered for subscription by com¬
mon stockholders of record March 25,
1958, at the rate

Motel Corp. of Italy

it Institutional Income Fund, Inc., New York
March 5 filed (by amendment) 800,000 additional shares
of common stock (par one cent).
Price — At market.
Proceeds—For investment.

tions.

—

Co., New York. Offering—Expected early in April.

Corp.

it Oakcrest Country Club Inc.
March 5 (letter of notification) $30,000 principal amount
of
10-year 5% debentures (in denominations of $50
each).
Proceeds—To defray cost of installing capital
improvements.
Office — 6100 Marlboro Pike, Prince
George County, Md. Underwriter—None.

it Montgomery (William) Co.
5
(letter of notification) 22,000 shares of 6%
preferred stock to be sold to retail dealers, suppliers,
and employees of issuer. Price—At par ($10 per share).
Proceeds
For future inventory.
Office — King of
Prussia, Pa. Underwriter—None.

For

150,000

& Engineering

(par 25
Price—To be supplied by amendment. Proceed*
—To prepay indebtedness to Norden-Ketay Corp., to
purchase additional equipment and for working capital.
Underwriter—Hayden, Stone & Co., New York. Offer-?
ing—Temporarily postponed because of market condi¬

March

ceeds—For

filed

(N. Y.)

Science

cents).

28.

shares of common stock (par 10
cents). Price—To be related to the market price. Pro¬

Feb.

Corp.,

Nuclear

Sept. 20 filed 100,000 shares of common stock

it Mississippi Power & Light Co. (4/16)
March 5 filed $15,000,000 of first mortgage bonds due
1988.
Proceeds—For property additions and improve¬
ments, to pay off bank loans, and other corporate pur¬
Underwriter—To be determined by competitive
poses.
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Kuhn.
Loeb
&
Co.; Equitable Securities Corp. and
Shields
&
Co.
(jointly); Blyth & Co., Inc.; Merrill
Lynch, Pierce, Fenner & Smith, Eastman Dillon, Union
Securities & Co., White, Weld & Co. and Kidder, Pea¬
body & Co. (jointly); The First Boston Corp. Bids —
Tentatively expected to be received up to 11:30 a.m.
(EST) on April 16.

Motel Co. of Roanoke, Inc., Roanoke, Va.
Nov. 18 (letter of notification) 60,000 shares of common
stock (par 40 cents).
Price—$5 per share. Proceeds—

Industro Transistor

pre¬

mon

Development Corp.

—Fort

(par $100), to

Feb,

filed

stock

it Northwest Refining & Chemical Co.
i •;
28 (letter of notification) 200,000 shares of com-<
stock (par two cents).
Price—25 cents per share.j
Proceeds—To purchase raw materials.
Office—125 N..r>
Park Road, Spokane, Wash. Underwriter—None.
f,.r-

notification) 200,000 shares of common
par ($1 par value). Proceeds — For
Office —1710 Hoge Bldg., Seattle 4,

—

expenses.

■

offered for subscription i
by common stockholders of record on March 27, 1958,
at the rate of one preferred share for each 16 common i
shares held; rights to expire on April 14.
Proceeds—
Approximately $7,000,000 to be invested in three major)
affiliates and the balance for working capital and other
corporate purposes. Underwriters — The First BostonCorp. and Blyth & Co., Inc., both of N«w York.
/• 7

Stuart

441

share at the rate of two new shares for each
five shares held. Proceeds—For working capital. Office

Lauderdale, Fla. Underwriter—None.

gas

Probable

20,000 shares of capital stock (no par).
Price—$50 per share. Proceeds—For general corporate
purposes. Underwriter—None. Walter M. Ringer, Sr., of
Minneapolis, Minn., is President.
Statement effective

Horlac

and

* Northwest Bancorporation (3/2S)
March 6 filed 106,430 shares of new convertible

Wash. Underwriter—None.

at $6 per

Feb. 17 filed $2,000,000 of

Electric Co.

11 filed $20,000,000 of first mortgage bonds,

of common stock (no par). ',
Price—$27 per share. Proceeds—To repay short term ;
bank loans and for working capital.
Business — Sells'hatching eggs and day-old chicks. Underwriter—None. ■;
George E. Coleman, Jr., is President.

Home Owners Life Insurance Co.

shares of class A common stock to be
offered to the public at $5 per share and 116,366 share*
of class B common stock to be offered to stockholder*

Rights will expire

Nov. 14 filed 25,000 shares

Merck &

Hofmann Industries,

Nov. 1 filed 50,000

each 16 shares held.

Jersey Boll Telephone Co. (3/25)
Feb. 28 filed $30,000,000 of 35-year debentures due April.
1, 1993. Proceeds—To redeem a like amount of 478% '
debentures due 1993 on or about April 28. Underwriter r
—To be determined by competitive bidding.^Probable*
bidders: Halsey, Stuart & Co.,Jnc.; White, Weld & Co.^
and Shields & Co. (jointly); Morgan Stanley & Co.; The
First Boston Corp. Bids—Tentatively expected to be re-;;
ceived up to 11 a.m. (EST) on March 25.
'
; >
/

Angeles Airways, Inc.
(letter of notification) 1,923 shares of common
stock (par $10). Price—$52 per share. Proceeds—To go
to selling stockholders. Office—5901 Imperial Highway,
Los Angeles 45, Calif. Underwriter—Dean Witter & Co.,
Los Angeles 14, Calif.
~j.

New

Los

•

■

Inc., Sinking Spring, Pa.
Dec. 20 filed 227,500 shares of common stock (par 25
cents) to be offered in exchange for outstanding common
•hares of Van Dorn Iron Works Co. Underwriter—None.
•

Ohio

Feb. 20

Feb.

Price—At. par ($10 per share).. Proceeds '
capital^ Office — .1521 North 16th St.,
Omaha 10, Neb. Underwriter—None. - *
/ '

(letter of notification) 1,785 shares of common
stock (no par) being offered for subscription by common
stockholders at the rate of one new share for each
62.52 shares held as of Feb. 25, 1958; rights to expire on
May 1, 1958. Price—$28 per share. Proceeds—For addi¬
tions and improvements.
Office — 203 West 9th St.,
Lorain, Ohio. Underwriter—None.

•

Thursday, March 13, 1958

March 15,1958.
—For working

March

share for

new

—For development

Dec.

Nebraska Consolidated Mills Co.

cents).

March 4

Feb. & (letter of notificatiort) 25;QOO Shares of common ;
stock to be offered to stockholders at the rate of one '*

(par 25

Jan.

0";«»—Mnn+"orr\orv.

Patterson is President.

A10

Underwriter

Statement

—

effective

None

Feb.

27.

■

Volume

187

Number 5724

The Commercial and Financial Chronicle

(1193)
Pleasant Valley Oil &
Mining Corp.
Sept. 30 (letter of notification)
2,000,000 shares of com¬
stock. Price—At
par (five cents per share).
Pro¬
ceeds
For geological studies, reserve for
contingent
liability, for machinery and equipment and other re¬
serves.
Office
616 Judge
Bldg., Salt Lake City, Utah
Underwriter—Steven Randall & Co., Inc., New York.

Wayne Pump into (1) 234 shares of
surviving corporation to be known

mon

Corp., and (2)

stock of the

common
as

Washington National Development Corp.

Symington Wayne

Oct. 2

(letter of notification) 50,000 shares of common
(par $1) of which 34,280 shares are to be offered
publicly at $1.20 per share and 15,720 shares are to be

option to purchase an additional share
at prices
commencing at S10 per share. Underwriter—
-None.
(
;

—

stock

...

offered to certain individuals under
options. Proceeds—
For genera] corporate
purposes. Office — 3612 Quesada

—

Tax

Equitable Securities Corp., Nashville, Tenn.

the Prov¬

Manitoba, Saskatchewan

and

Alberta

and

Held

one

each

class

Price—$11- -per', unit./ Proceeds—To build

*jl.

record

Professional Life & Casualty Co.,Champaign, III.
16 filed
120,000 shares of common stock.- Price—
$15 per share. Proceeds—To increase
capital and surplus.
Underwriter—None.* - ;
y
1
i

indebtedness and
•

cents).
—To

filed-113,000 shares of

Price—To be supplied by amendment.! Proceeds
Savings Insurance Co., the selling stock¬

Office—Charleston, S. C; Underwriter—None.

Reichhold Chemicals, Inc.

(3/20)

Oct. 10 filed 200j000 shares of

stock

;

■

subordinated

Uranium

j,'\/>.;,.;;.,:Y,

Y\v4 -V

exchange

Schering

basis of

.common

mon

;
,*
.

Corp.

basis of
per

one

share.

Sept.' 19,

1957):

new

share held.

•

subsidiary.

for 10 shares owned.

stock.

Southern

Dec.

Electric

Underwriter
.

—

Selected Investments,
•

each).

Price—At

; ' ' •;
•

par

(in

|
United States Telemail Service, Inc.
17 filed 375,000 shares of common stock

Feb.

(par $1).
Price—$4 per share. Proceeds—To purchase equipment
and supplies and for working capital and other corporate
purposes.
Office—Salt Lake City, Utah. Underwriter-

demand

•

$1,000

notes

pay¬

Inc.

Nov. 19 (letter of notification) 1,500 shares of 7% cumu¬
lative preferred stock. Price—At par ($100 per

share).

Worth, Tex. Underwriter—Reilly, Hoffman & Sweeney,
Inc., New York, N. Y. Offering—Delayed.
III.

Underwriter—White, Weld & Co.,

New York.
,

Symington-Gould Corp.,

Depew,

Feb. 28 filed 593,939 shares of common stock and 263,973
Warrants to be issued, in exchange for the stock of the

Wayne Pump Co. under
vides

for

conversion

merger

agreement which pro¬

eacji share

purposes.

Street, New York, N. Y.1 Under¬

filed 400>000

Southern

•

Pines, S, C.

•

Young (Donald W.) & Son, Inc.
Y
Nov. 14 (letter of notification) $75,000 of 10-year H%
debentures due Oct. 1, 1967, with common stock war¬
rants to purchase 7,500 shares of 10-eent par common
stock at $1 per share; Price—$100 per unit of a
$100
debenture and one warrant. Proceeds—To repay short
term debt and for working capital.
Office—Stockholm,
N. Y. Underwriter
Sherry, Maloney & Co., Inc., New
York. Letter being withdrawn.
; ' Y
'
—

of capital

stock

★ American Can Co.
March
the

William

directors have

Stolk,

President, announced

that

approved a public offering of $80,-

000,000 long term debentures.
Proceeds—To redeem
$40,000,000 of outstanding debt and for working capital.
Underwriters—Morgan Stanley & Co. and Clark Dodge
& Co., both of New York, Registration — Expected in
near

future.

fl-

y", it'"

I'..'','

Appalachian Electric Power Co. (6/3)
Dec. 2, 1957, it was reported this company, a subsidiary
of American Gas & Electric Co., plans to issue and sett
$25,000,000 of first mortgage bonds. Proceeds—To repay
bank

loans

—To

and

for

construction program.

Underwrite*
competitive bidding. Probabtti
Halsey, Stuart & Co. Inc.; The First Boston
Kuhn, Loeb & Co. and Eastman Dillon, Union
determined by

bidders:

(jointly); Harriman Ripley & Co. Inc;
Bids—Tentatively expected to be received on June 3.
,

Associates

Investment

selling stockholders who are to receive said shares in
exchange for their holdings of Empire Steel Corp. and
Reeves Steel & Mfg. Co. common stock on the basis of

Jan. 23 it

8.68

shares Universal for each Empire share and 5.51
shares Universal for each Reeves share. Underwriter —

Brothers, both of New York.
July 1.

None.

it Atlantic

Statement effective Feb. 28.

was

Co.

reported company plans to issue and sett

additional debentures (amount not yet determined).
Underwriters — Salomon Bros. & Hutzler and Lehman
some

Offering—Expected beforo

April 30 filed 1,250,000 shares of common stock (par 1«
cents). Price—To be supplied by amendment (expected
to be $1 per share). Proceeds—For exploration purposes
Underwriter—To be named by amendment. Graham Al-

Barney & Co., both of New York. Registration—Planned

bert Griswold of Portland. -Ore., is President.

for March

(3/25)

Feb. 27 filed 253,000 shares of common stock (par
$1),
of which 203,000 shares are to be offered
publicly.
Price—To be supplied by amendment.
Proceeds—To

Uranium Corp. of America,

St., Fort

selling stockholders.

East 43rd

Mar. 31.

Electric Co. (4/23)
reported company plans to issue and
sell 50,000 shares of preferred stock (par $100)
and
120,000 shares of common stock. Underwriters—May bo
Eastman Dillon, Union
Securities & Co. and Smith,

Proceeds—For construction, payment of promissory note
and working capital.
Office—3309 Winthrop

Stepan Chemical Co., Chicago,

(EST)

Securities & Co.

filed 600,153 shares of common stock (par $1).
.Price—To bd supplied by amendment.
Proceeds—To

Office—2301 Huntsville Road,
Underwriter—None.

Sovereign Resources,

„

Corp.;

Co., Inc., of New York.

Universal-Cyclops Steel Corp.

Feb.

able and working capital.

Birmingham, Ala.

a.m.

Price—To be supplied by amendment. Proceeds—

Amos Treat &

denominations

payment

to 11

Fund, Inc., New York
shares of common stock. Price—
$12.50 per share.
Proceeds—For investment. v Underwriter—Cherokee Securities Corp., 118 N. W. Broad St.,

None.

Steel Co.

Proceeds—For

working capital and general corporate

Feb.

Wilmington,

(par-one
Ycent). Price—$1 per share. Proceeds—For plant rental
etc.; to retire corporate notes; for core drilling; foi
working capital; and for other exploration and develop¬
ment work.
Office
Houston, Texas. Underwriter —

23 :

Warrants),

(jointly); Merrill Lynch, Pierce, Fenner &

Worth

Oct. 8 filed 1,500,000 shares of common stock

(letter of notification) $300,000 of 6% second
mortgage serial bonds (with common stock purchase
,

Inc.

writer—J. A. Winston & Co., Inc., New York.

United States Sulphur Corp.

For

loans, to repay all or part of an out¬
standing 5% term loan and/or provide additional work¬
ing capital. Office—Roanoke, 111. Underwriter—Whitt
& Co., St. Louis, Mo., on a best-efforts basis.

postponed.

Co.

.To reduce bank

selling stockholders. Underwriter—Merrill Lynch, Pierce.
Fenner & Smith, New York.
Offering — Indefinitely

— For
corporate purposes and con¬
Underwriter—To be determined by competi¬

Office—207

■

Oct. 10 filed 155,000 shares of common stock
(par $1).
Price—To be supplied by amendment. Proceeds—To two

Proceeds

Smith and Equitable Securities Corp.
(jointly); Lehman
Brothers and Salomon Bros. & Hutzler (jointly). Bids-

Price

—

Simplicity Pattern Co. Inc.

Manufacturing Co. \
Sept. 24 filed $600,000 of 6% sinking fund debentures
and 30,000 shares of class A common stock (par
$lf to

Sheraton Properties, Inc., Boston, Mass.
3Q filed $990,000 of first mortgage.
sinking fund
bonds due Dec. 1, 1973. .Price—At par.
Proceeds—To
repay indebtedness. ^Underwriter — Sheraton Securities
a

1988.

(3/31>j

$30,000,000 of first mortgage bonds, series

Probable bidders: Halsey, Stuart & Co.
Inc.; The First Boston Corp.; Glore, Forgan & Co., East¬
man Dillon, Union Securities & Co. and Harriman
Ripley

Ulrich

be offered in units of $500 of debentures and 25 shares of

-Dec.

Corp.,

due

it Travelers Oil & Uranium Co., Inc.
(letter of notification) 235,000 shares of com¬
mon stock.
Price—At par ($1 per share).
Proceeds—
For the development of oil and gas
properties and min¬
ing expenses. Office—Room 312, First National - Bank
Bldg., Rerio, Nev. Underwriter—None. ; •

Underwriter—None.

the

expire

share/ Proceeds—For general
j.-

March 3 filed

Proceeds—For drilling for oil and gas.
Main Street, Coudersport, Pa.
Under¬

■

Sentinel Security Life Insurance Co.
Nov. 27 filed 5,000 shares of common stock (par $10).
Price—To be supplied by amendment. Proceeds—For
working capital. Office—Salt Lake City, Utah. Under¬
writer—None.

effective

share of preferred stock and 1 Vz shares of
stock for each White class A or class B com¬

one

per

Worldmark Press, Inc.
Dec. 20 (letter of notification) 150,000 shares of common
stock (par 10 cents).
Price—$2 per share. Proceeds—

N. c.

for

10 shares held; rights to

Price—$7.15

Expected to be received

N. C.

stock of White Laboratories, Inc. (which is to be merged

'with

tive bidding.

Manufacturing Co.
(letter of notification) 15,000 shares of common
stock (par $5). Price — $4.50 per share. Proceeds — For
working capital and payment of current liabilities. Ad¬
dress—Wrightsboro section, 3 miles north of Wilmington,

con¬

4/,• >

/ Wisconsin Electric Power Co., Milwaukee

•

Mining Corp.

Trask

vertible preferred stock (par $30) and
418,475 shares of
-common, stock
(par $1) to be issued in

"/•''!'■

corporate purposes.1 Office—214 W, 39th St., New
York,
Underwriter—None./;
; *'

Dec. 5

;

•N. Y*.

March 6.

April 7.

—

.Tenn.

it Trans-Eastern Petroleum Inc.

writer—None.

($1 per share). Proceeds—To re¬
pay outstnding indebtedness. Office
Littleton, Colo.
; Underwriter—R. B. Ford Co., Windover Road, Memphis.

; V / 'V.

Feb.

Office—203

par

1 \k Schering Corp., Bloomfield, N. J.
Sept. 19 filed; 278,983 shares of 5% cumulative

share for each

new

acquisition, exploratory work, working capital; reserves,
and other corporate purposes. Underwriter—None. Alfred E. Owens of Waterloo, la., is President.

the

£ Rocky Mountain Quarter
Racing Association
Oct. 31 (letter of notification)
300,000 shares of common

Price—At

'4 '

Nov. 6 filed 3,000,000 shares of common stock
(par one
mill). Price—25 cents per share. Proceeds—For land

—$4

capital expenditures and other corporate purposes. Underwriters—Merrill Lynch, Pierce, Fenner & Smith and
Blyth & Co., Inc., both of New York.

stock.

Trans-America

,—

(letter of notification) 7,500 shares of common
stock (par $1) to be offered pro-rata to stockholders oil

for each eight shares
held; rights to expire on April 14.
Price
100% of principal amount.
Proceeds — For
'

Underwriter—

•

date.

it Willcox & Gibbs Sewing Machine Co. (3/19) !
March 3 (letter of notification) 25,500 shares of common stock
(par $5) to be offered for subscription by
common stockholders of record March 17 on basis of
one

struction.

debentures, due April 15, 1983, to be offered for sub¬
scription by common stockholders of record March 25,
1958 at the rate of $100
principal amount of debentures

construction.

derwriter—None.
'

(letter-oX notification) 20,000 shares of com¬
(no par) to be offered pro-rata to stockhold¬
ers, then to the public, Price—$7.50 per share/ Proceeds
—To pay notes payable and bank loans and for
working
capital. Underwriter—None.
:

new

'.f J"\- v-44'

Co., Inc.-, New York.

Proceeds—To acquire mortgages or other liens
on real
estate, also for loans to or invested in hotels, re¬
sorts or inland transport.
Office—Jerusalem, Israel. Un¬

Richfield Oil Corp. (3-26)
6 filed $50,000,000 of convertible

j-,\ l"

thereof.

(par $1).

mon, stock

March

Tourist Industry Development Corp. Ltd.
.Jan, 14 filed $2,250,000 7% perpetual subordinated de¬
bentures (4% fixed interest and 3%; of
earned), to be
sold at par in denominations of
$1,000 and multiples

Price—To, be - supplied by- amendment. Proceeds—For
expansion program and working capital. Underwriter—
Blyth & Co,j Inc.; New York.
■;
Y"Y" Y
it Resolite Corp., Zelienople, Pa.
March

common

for

Dillon, Read & Co, Inc., New York.

(par 50

Public

holder^
•

stock

common

record

Price—At par ($1 per share). Proceeds—For development and exploratory work, drilling costs and sur¬
vey, and for working capital.: Office — 1205 Phillips
Square/Montreal, Canada. Underwriter—Jean R. Vedit*

Texas Eastern Transmission Corp. (3/19)
j
27 filed $25,000,000 first
mortgage pipe line bonds
due 1978.
Price—To be supplied by amendment:, Office
—Shreveport, La. Proceeds—To repay short-term note

Public Savings Life Insurance Co.
Nov. ;29

r„

the

stock.
v

Feb

Western Copperada Mining Cerp. (Canada)
Aug. 30 (letter of notification) 300,000 shares of common

■

Dec.

held

common

writer—None.-

construction/" Underwriters—Stone & Webster Securities
.

principal amount
shares, at rate of one unit

each

tion of six

/'Corp'., arid -White, Welcl & Co., both of New York.V"v-

March 1, 1958, in units of
$100

of debentures and 25 common

for

Price—$125 per unit. Proceeds—To finance the acquisi¬
new Fairchild F-27 "Friendship'* aircraft on
order for delivery during
1958, and related costs. Under-

;

Airlines, Inc., Seattle, Wash..

12 filed
$600,000 of 6% subordinated debentures,:,
due 1970, and 150,000 shares of common stock
(par $1) to :
be offered for
subscription by common stockholders of

44 Tennessee Gas Transmission Co/43/18)
, Feb.T 26- filed
200,000 shares of cumulative convertible
second preferred stock (par $100). Price—To be
supplied
by amendment. Proceeds—To repay bank loans and for

stock.

-'J

West Coast

Underwriter—Wagner

Feb.

Underwriters^—
Stone. & Webster Securities Corp., White, Weld & Co.
and Halsey, Stuart &
Cor/Tnc.', all of New York. V
4

lease plant,

or ;

-/*_

Offeringlegislation by

necessary

repay bank loans and for construction.

units

Tennessee Gas Transmission Co.
(3/18)
Feb, 26.filed $30,000,000 of debentures due May
1, 1978.
; Priced—To be supplied by. amendment. •' Proceeds—To

Premier Pharmaceutical
Corp., Buffalo, N.tV.
>
Jan.. 29. filed 300,000 ;sbares. of 6% preferred stock
(par
$10> and 100,000 shares of common stock
(par $l)to be
in

passing

-Saskatchewan,
Canada. Underwriter—Allied Securities
Ltd., Saskatoon,
Canada. ,.
;
w

offered

pending

Congress.

residents of the United States
"only in the State of North
Dakota.". Price—$2.50 per share.
Proceeds — For con-*
struction purpose.- Office—
Saskatoon,
..

St., N. W., Washington, D. C.
Co., New York City,

June 20 filed 40,000 shares of common stock.
Price—$29
per share.
Proceeds — For investment. Underwriter-

Prairie Fibreboard Ltd.
Feb. 28 filed 210,000 shares of common
stock (par $1.50)
to be offered for
sale to residents of Canada in
inces

Exempt Bond Fund, Inc., Washington, D. C.

Portland, Oro.

Feb.

Valley Farms, Inc., Denver, Colo.
Feb. 26 filed 32,000 shares each of class A, class B and
class C preferred stock (par $25), and 32,000 shares of
common stock
(no par) to be offered in units of one
share each of class A, B and C preferred and one share
of common.
Price—$100 per unit. Proceeds—To repay
loan on real estate and for farm operating capital. Un¬
derwriter—Entro Corp., 812 Equitable Bldg., Denver 2,
Colo., oil a best-efforts basis.
.

•

Atlantic

City

was

19.

(4/23)
Feb. 28 it was reported company plans to issue and sell
$10,000,000 to $20,000,000 of first mortgage bonds due
1988.
Underwriter—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Eastman Dillon, Union Securities
& Co. and Smith.
Barney & Co. (jointly); Blyth & Co., Inc.; The First
City Electric Co.

Continued

page

The Commercial and Financial Chronicle

(1194)

Thursday, March 13, 1958

„

Boston

Co.

'•■■■■

;

■

Continued

both

(jointly); White, Weld
Bids—Expected
Registration—Planned lor March 19.

Corp. and Drexel & Co.
and

April 23.

Shields

Co.

Baltimore & Ohio RR.

(jointly).

(3/27)

to be received by the company on
March 27 for the purchase from it of $3,435,000 equip¬
ment trust certificates. Probable bidders: Halsey, Stuart
Bids

are

First Boston

The

from page 49

expected

Co. Inc;

Salomon Bros. & Hutzler.

Boston

Edison Co.

Florida
Jan. 29

Fund, Inc., Fairfield, Calif.
announced this newly organized invest¬
ment company plans to offer to bona fiae
residents^ of
California 10,000 shares of capital stock (par $1). Prisee
—$10 per share, less an underwriting discount of 8/2%.
Master

Corp. and Dominion Securities Corp.,
Offering—Expected early in April.

New York.

Power

Corp.

Jan. 27

(7/1)

reported corporation plans to issue and
sell $25,000,000 of first mortgage bonds due 1988. Under¬
writer—To be determined by competitive bidding. Prob¬
able bidders; Halsey, Stuart & Co. Inc.; Kidder, Peabody
was

reported company may issue and sell Id
of this year some additional
first mortgage bonds and preferred stock. Proceeds—To
repay bank loans and for construction program. Under¬
writer—For bonds to be determined by company, with

Lynch, Pierce, Fenner & Smith (joint¬
ly); Lehman Brothers and Blyth & Co., Inc. (jointly);
Dillon, Union Securities & Co., and Harriman
Ripley & Co. Inc. (jointly); The First Boston Corp. Bids
—Expected to be received on July 1.

7 this new fund registered under the Invest¬
Company Act of 1940. Plans to issue $15,000,000
stock, of which $7,500,000 will be underwritten
on a firm basis by Ira Haupt & Co.
Price—$10. Proceeds
—For investment. Technological AdvisoriM-Include Dr.

prospective bidders including Halsey, Stuart & Co. Inc.;
The First Boston Corp.; White, Weld & Co.; Lehman
Ripley & Co. Inc. (jointly). Fox

(March 13.)

preferred stock, The First Boston Corp., New York.

Feb. 19 it

Brooklyn Union Gas Co. (5/21)
Nov. 25, 1957, it was announced that company expects to
issue and sell $22,000,000 of first mortgage bonds due
1983.
Proceeds—To repay bank loans and for con¬
struction program. Underwriter—To be determined by
competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; Lehman Brothers; Blyth & Co., Inc., and
F. S. Moseley & Co. (jointly); Merrill Lynch, Pierce,
Fenner & Smith; Harriman Ripley & Co. Inc. and The
First Boston Corp. (jointly); White, Weld & Co. Bids—
Expected May 21.
•

^ California Electric Power Co.
March 10 it was reported company may issue and sell in
1958 about 450,000 additional shares of common stock.
Underwriter—To be determined by competitive bidding.
Probable bidders: White Weld & Co.; Kidder, Peabody
& Co.; Merrill Lynch, Pierce, Fenner & Smith; Carl M.
Loeb, Rhoades & Co., and Bear Stearns & Co. (jointly).
•

Central Hudson Gas & Electric Corp.
Jan. 22 it was reported company plans to issue and

sell
$18,000,000 of first mortgage bonds (previous bond fi¬
nancing done privately). Underwriter—If sold at com¬
petitive bidding, probable bidders may include: Halsey,
Stuart & Co. Inc.;. Eastman Dillon, Union Securities &
Co.; The First Boston Corp.; White, Weld & Co. and
Stone & Webster Securities Corp. (jointly); Kidder, Peabody & Co. Bids—Tentatively scheduled to be received
about the middle of May.

on
increasing the authorized preferred stock (par
$100) from 250,000 shares to 500,000 shares. Underwriter
—Eastman Dillon, Union Securities & Co., New York.

Chicago District Pipeline Co.
Nov.

12, 1957, it was' announced company plans jto sell
about $5,000,000 of first mortgage bonds sometime after
the turn of the year.

Proceeds—To repay advances made
by Peoples Gas Light & Coke Co., the parent. Under¬
writers—Probably Dillon, Read & Co. Inc. and Halsey,

Southern National

Bank of

Savannah, Ga. (4/8)
was announced stockholders of record April
8, 1958 are to be given the right to subscribe for 100,000
additional shares of capital stock at the rate of one
new share for each
10 shares held.
Price
$30 per
share. Proceeds—To increase capital and surplus. Un-

March 11 it

—

derwriterus-None.
•

Columbus & Southern Ohio Electric Co.
Dec. 9 it was reported company plans to issue and sell
about 250,000 additional shares of common stock. Under¬

writers

—

(jointly).
in 1958

Dillon, Read & Co. Inc. and The Ohio Co.
Permanent financing not expected until late
possibly early in 1959.

Commonwealth Edison Co.
Feb.
9ell

was*

announced

(4/15)

company

plans to issue and

$50,000,000 to $60,000,000 of mortgage bonds.

ceeds—For construction

program.

Pro¬
Underwriter—To foe

determined

by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Glore,
Forgan & Co. Bids—Expected to be received on April 15.
Registration—To be filed about the middle of March.
Feb. 25 it Was announced
company plans to issue and
sell $45,000,000 of
sinking fund debentures. Underwrit¬
ers—To be determined
by competitive bidding. Prob¬
able bidders:

Halsey, Stuart & Co.; White, Weld & Co.
Paine, Webber, Jackson & Curtis (jointly); Morgan

Stanley & Co. and First Boston Corp. (jointly).
ing—Expected in second quarter of 1958.

Offer¬

Delaware Power & Light Co.
Jan. 22 it Was reported
company plans to issue and sell

$10,000,008 of first mortgage bonds due 1988.
—To

repay

bank loans and for construction

^dei^ter—To be determined by

Proceeds
program,

competitive bidding.

Probable bidders: Halsey, Stuart & Co;
Inc.; White, Weld
& Co. ahd Shields & Co.
(jointly); Eastman Dillon, Union
Securities & Co.; The First Boston
Corp. and Blyth &
Co- Inc.
(jointly); Merrill

Lynch, Pierce, Fenner &
Kidder,. Peabody & Co. (pointly). OfferingExpected.in June.
Smith and

• Diiton Chemical Industries, Inc.
was reported
company plans to do some fi¬
nancing^ the type of securities to be announced later.
Proceeds—-For expansion. Underwriter—Harriman Rip¬
ley & Co* Inc., New York
March 18 it

• Edmonton.

(City of), Alberta, Canada
reported early registration is expected
issue of $20,000,000 debentures. Underwriters

March 3 H

was

sell

loans

•

determined

ties &

Dillon, .Union Securi¬

•

on
'

(5/19)pT-V-

Jan. 29 it

was reported company plans to issue and sell
250,000 shares of common stock. Underwriter — To be

by competitive bidding. Probable bidders:
Lynch, Pierce, Fenner & Smith and Lehman
Brothers (jointly); Stone & Webster Securities Gorp.
Bids—Tentatively expected to be received on May 19.
determined

March 3

it,was araiounced = this company,; a subsidiary
of
Ifew ,' England .Electric i System,
propases / to r file
$10,000,000 prinGipal amount of. first morfgafe/ bonds,
"series H, due ll 988. Underwriter—To be determined' by
competitive, bidding. Probable bidders; Halsey,»Stuart
& Co. Inc.; AThe First Boston Corp.; Kuhn, Loeb & Co.,
Eastman Dillori, Union Securities & Co. and Salomon
Brp$. & Hutzler (jointly); Lehman Brothers; Merrill
Lynch, Pierce; Fenner & Smith; Kidder Pedfoody & Co.
mid-White; Weld; & Co. (jointly); Equitable SecitriBes
Corp. and Blair; & Co., Inc; (jointly). 'Bids—Tentatively
scheduled to be received on June 11 at 441 Stuact St.,
Bdston 16, Mass.' Registration—Expected early in MOy.

Dillon, Union Securities & Co.; White, Weld &
'

Co. and Merrill Lynch, Pierce, Fenner & Smith (jointly);
First Boston Corp.; Harriman Ripley & Co. Inc.

Kansas

Power

May 20.

Light Co.

Feb.

14 it was announced company plans to issue and
$10,000,000 of first mortgage bonds due 1988, Pro¬
ceeds—For construction program.
Underwriter—To be
determined by competitive bidding.
Probable bidders;
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Glore,
Forgan & Co.; Harriman Ripley & Co. Inc.; White, Weld
& Co.; Blyth & Co., Inc.; Equitable Securities Corp. Reg¬
istration—Expected before Spring.
"
*

sell

New England Telephone & Telegrap'n Co. (4 14)
19 "it was announced company plans to issue and
sell $45,000,000 of 35-year debentures. Proceeds—To re¬
Feb.

deem

Langley & Co., Boston and New York.

Probable bidders: Halsey, Stuart & Co. Inc.;
Morgan Stanley. & Co.; The First Boston Corp. Bids—
Tebtatively scheduled to be received on or about April
.

construction.

Underwriter—To

Eastman

be determined by competitive bidding.

Probable bidders:
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; Lee Higginson Corp.; Equitable Securities Corp.; Eastman
Dillon,
Union Securities & Co. and Merrill Lynch, Pierce, Fenner
& Smith (jointly); Kidder, Peabody & Co. and White,
Weld & Co. (jointly); Kuhn, Loeb & Co. Offering—Ex¬
pected in September or October.

—

Jersey. Power & Light Co.
■
was reported company plans to issue and sell
$7,500,000 first mortgage bonds due 198$. - Underwrite^-7To. be^determined py competitive bidding. Probable bid¬
ders? Halsey, .Stuart & Co. Inc.; Kuhn, Loeb & Co.; Leh¬
man "Brothers,-.and
Salomon Bros. & Hutzler (jointly);
w

Feb.-24 it

;

Kentucky Utilities Co.
was reported company plans to issue and sell
$10,000,000 of first mortgage bonds. Proceeds—To repay
new

1986 and to

bidding.

Jan. 21 it

bank loans and for

debentures due

CoJ-Underwriter" — To be determined by competitive

(D. S.) & Co.
'
reported company plans to issue and sell
100,000 shares of common stock. Proceeds—For working
capital. Business—Manufactures radar antenna. Under¬
was

Offering—Tentatively expected early in April. J

$35,000,800 mi 4%%

rep$y advances' fromcAmerican Telephone & Telegraph

it Kennedy

writer— W.

c"onlmb'n shareff (par $1) .to; stockholders
basis; unsubscribed shares will be made

for; subscription

was

Bids—To be received

(4/15)
J.
§nnoqn<rCd that company ;i§ planning to

Brothers, and Bear/ Stearns & C^. (jointly).
Bids—Tentatively, set for April 15. Registration— Ex¬
;.^
"4 ^' '/T"
"
New England Power Co. (6/11)
--/yV

(5/20)

reported company plans to issue $25,000,000 of first mortgage bonds. Proceeds—For construction
program. Underwriter—To be determined by competi¬
tive bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Eastman

■

pected March 14.:
'

Jan. 29 it

Power Co.

v'%■ i;,"*

Lehman

Merrill

Illinois

UndeiWriters^-^-Glore,

by employees under- a 1958
employee {/ share ^ purchase plan. / Underwrihr^ToH be
determined by competitive bidding. Probable bidderfe:Carl M.. Loeb; Rhoades & Co., Ladenburg^foalmaiii? ,&
Co., and Wertheim & -Co. - (jointly); fMerrill'frLynch,
Pierce, Fenner, & Smith, Kidder,"Peabody
Ihe:,
and White Weld & Co: (jointly); Blyth :& Co. Inc.,

Co.

Utilities Co.

l-for-12

available

Securities Corp.;

Gulf States

cbhsttuctiori.

/New England Electric System

(jointly); Lehman Brothers; Stone & Web¬
Kuhn, Loeb & Co. Bids — Ex¬
pected to be received en May 19.
f
ster

new

March 3, it Whs
offer 968,549 of

Bros. & Hutzler and-Eastman

mon

and: for

Forgan & Co: and Harriman Ripley &'Cb. Inc., 'bbth of
New. York:

of first mortgage > bonds. .Underwriter
by competitive bidding. Probable
bidders; Halsey, Stuart & Co. Inc.; Merrill Lynch, Pierce,
Fenner & Smith and White, Weld& Co. (jointly) ; :Salobe

★ National Distillers & Chemical Corp.
t;
waS reported company is expected to issue
and aeil about $50,000,000 ;fo $60,000,000 long-term secririties. Proceedi^Will probably be used to repay bank

$20,000,000

—To

NATO. J

March 3 it

Dillpn,Union Securities & Co., and White
Cb;v(jointly); The First Boston Corp.; Merrill
Lynch, Pie;r&g, Fenner & Smith; Equitable Securities
Corp/ Bids—-Expected to be received between April f5
and May/15.
J4'*4
/'/'■
■'
Weld

A Niagara Mohawk Power Co.
'
3 it. was reported company may issue and sell

March

Kentucky Utilities Co. '
21 it was also reported that company may offer
approximately 165,000 additional shares of its common

$50,000,0p0 bf jhbrigage bonds/probably this fall. Unde#-

stock

bofnpbBtivef bidding. Prob¬

Jan.

its

common

stockholders

l-for-15

bidddrS: Etaisey, Stuart & Co. Inc.; Morgan Stanley
Co.; 'The Eirst/Boston Corp.
;
:

able

basis.

Underwriters—Blyth & Co., Inc. and J. J. B. Hilliard &

^ Northern Pacific Ry.

Son.

Bids

./ "

■

Litton

16,000 shares of $100
in the authorized

par

the creation of an issue
preferred stock and an in¬

•

stock from 2,000,000 to
3,500,000 shares; Underwriters — Lehman Brothers and
Clark, Dodge & Co. handled last equity financing which
was done privately.
crease

construction.

Underwriter—To

determined by competitive bidding; Probable bid¬
ders: Halsey, Stuart & Co. Inc.; The First Boston Corp.

also

was

announced

that

company

plans to

offer to its stockholders early in May about 690,000 addi¬
common stock at the rate of one new

share for each 10 shares held.

and

for

Proceeds—To repay bank

Louisiana Power & Light Co.!

ing to the disposition of its gas properties to Louisiana
Gas Service

Co.,

a new company.

(jpiritly)) /Harriman'^Ripley^ & Co.. Inc. and Eastman
Dillpnj Uniqii"Securities :& Co. (jointly).
•

& Co.

Dee. 16, it was announced company may borrow $11,500:000 from banks pending a final financing program relat¬

•

EIectric ,Co..---'"';.*>

Co.

construction.

Underwriters—Blyth
Co., Inc.; The First Boston Corp., and W. C. Langley
new

Oklahoma Gag A

plans to issue arid sell
$15,000,000 of bonds this year4 Uriderwriter-rTobe detefmined by. cbmpetitiyebkiding. Prpbable bidders* fl). Fdr
bonds^Halsey/ Stuart & Co.' Inc.; . Equital^e- Securities
Corp.; The/FirstB.oston Corp.; Kiihn, Loeb & Cov Merrill
Lynch, Pierce, Fenner & Smith and White, Weld #;

tional shares of
loans

Feb. 3 it wa^ireported. company

it Long Island Lighting Co.
it

was

Securities/l&^CoV (joinUy),.

Blyth & Co., Inc. (jointly).; W. C. Langley & Co.;
Smith, Barney & Co. Bids—Expected to be received
early irn May.
26

13 it

and

Feb.

(Minn.)
reported that the. company may be con¬
sidering theissue and sale this Summer of aboi&t $25,000,000 of first mortgage bonds. Underwriter—To' be determined by. competitive bidding. Probable bidders^ Halsey,
Stuart & .Pb. Ine.; The First Boston Corp. and Blyth &
Co., Inc. (jointly); Merrill Lynch, Pierce, Fenner &
Smith/Kidder, Peabody & Co. and White, Weld & Co.
(jointly); Jiehman Brothers and Riter & Co* (jointly);
Equitable- Securities Corp. and Eastman Dillon, Union
Jan.

Long Island Lighting Co.
plans to issue and sell
$20,000,000 of first mortgage bonds. Proceeds—To retire
new

(4/15)

expected to be received by this company on

Northern States Power Co.

common

Feb. 26 it was announced company
bank loans and for

are

April 15 for' the purchase from it of. abotit $7,600,000
equipment trust certificates. Probable bidders: Halsey,
Stuari 8c ,C^^Ine.; Salomon. Bros. & Hutzler.-

Industries, Inc.

Dec. 14 stockholders approved

Consolidated Natural Gas Co.

and

was

March 10 it

Stuart & Co. Inc.
Citizens &

;

Karman, Chairman of the advisory grdup

-'.v..
March 3 it was reported company, expects to do some
debt financing prior to July 1, 1958. Proceeds-^Among
other things', td repay $11,000,000 of bank loans. Under¬
writer—The First Boston Corp., New York..
'.v.p-V-i/

The

Central Illinois Light Co.
was announced stockholders will vote March

•

t V'

von

^ Mountain Fuel Supply Co.

reported a secondary offering of common
voting stock is expected within a month. UnderwritersMay include: Blyth & Co., Inc.; Carl M. Loeb, Rhoades
& Co.; Hemphill, Noyes & Co.; Smith, Barney. & Co.;
and Merrill Lynch, Pierce, Fenner & Smith.
? y
^
• Gulf States Utilities Co.
(5/19P.. >>•/■•*
Jan. 29 it was reported company plans to issue and

Jan. 22 it

Theodore

for aeronautical research and development of

Great Atlantic & Pacific Tea Co. ;

Jan.

ment

common

• General American Transportation Corp.r*(4/2) <
Mareh
12
it was announced
company' plans to
sell
$20,000,000 of equipment trust certificates. Underwriter
—Kuhn, Loeb & Co., New York. Offering—Tentatively
expected late in March. Registration—Expected today

Brothers and Harriman

Missiles-Rockets-Jets & Automation Fund, Info.

& Go. and Merrill

Jan. 27 it was

was

Proceeds—For investment.

Eastman

the second or third quarter

Pacific Telephpne & Telegraph Co.
was reported company plans $300,600,000 capital outlay program. Proceeds—For construction program
in 1958;and l959 ($137,000,000 in !958). Underwriter^To be determined by competitive bidding. Probable bid¬
ders— Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.
Jan. 8 it

Volume 187

Number 5724

.....

The Commercial and Financial Chronicle
r

Philadelphia Electric Co.

(4/29)
27 it.was reported company plans to issue

','Jan.

$46,000,000

of first mortgage bonds due
writer—To'be determined by competitive

and

petitive bidding to be sought. Stone & Webster Securities
Corp. and Dean Witter & Co. (jointly) were
only bid¬
ders for last rights
offer, which was on a competitive

sell

1988/" Under¬

bidding. Prob¬
Halsey, Stuart & Co. Inc.;,: The Firri Boston
Corp.; White, Weld & Co.; Morgan Stanley & Co, and
tDrexel <& Co. (jointly).
Bids—Expected to be received
/•up to noon (EST) on April 29. Registration—Planned for

Tuttle

basis.

Sierra Pacific Power Co.

(4/23)
reported company plans to issue and sell
$3,000,000 of first mortgage bonds due 1988. Proceeds—
To repay bank loans and for construction
program. Un¬

Jan. 27 it

:April 3.

<V'

~
'■>

Proceeds—To repay bank loans and for construction
progragi. Underwriter—'To be determined by/competitive/

bidding.

Probable

bidders:. Halsey,

White, Weld & Co.:

and Shields

Stuart
Co.

Co.

Co., Inc.; Salomon Bros; & Hutzler; Kuhn, Loeb &
Co. and Eastman
Dillon, Union Securities & Co. (joint¬
ly); The First Boston Corp.; Glore, Forgan & Co.;
Equitable- Securities Co.
'
, ;
'

Puget Sound Power & Light Co.

(4/28) /

Fenner &

McLaughlin, President, announced comt^pany plans'to issue and sell $30,000,000 of first mortgage
bonds due-1987 and to finance

Smith.

construction.

Riddle Airlines, Inc.

;

SEC

issue of

new

William R. Staats & Co.

Bids

finance route expansion and
fori.wopking capital
Underwriter—James II. Price & Co., Inc.,-Coral
Gables,
Fla. and New, York, N.
Y.,vhandled

/ Royal Bank of Canada
(3/19) *yy
.//Feb. 26 the Bank announced it plans

and

tp:foffer 1,008,000

J^hares
".

held; rights will expire

on: June 10, 1958/yPrice—$37.50
share (in Canadian currency).
PrdedfejJs^Td increase
capital andsurplus. Underwriter—NoneT This issue will

Jr.

corporate purposes.

Jan. 20 it

offer to its common/stockholders theright to subscribe
for 57,362 additional shares of
common :$tock (probably

with an oversubscription
privilege).- Proceeds—For consi/str.uction program.- Underwriter—Exemption from com¬

Bros.

mon

Hutzler

tors,

while

giving

recent"

what

little

stubborn

constitutes

from

ideas

fair

yield

rities

Underwriters—Floyd D.

long" shot;
and

ers,

nqt capitulate by
Prospective borrow-

appeared well
tion

and

aware

there

of this situa-

was

push

no"

severely

lower

Newest

monetary

de¬

moves

signed to spur the economy out of
its'downtrend appeared to exer¬
cise little influence on the invest¬
ment

markets.

Its

probable

forerunner

significance
a

new

inflationary

thrust, through the medium of
deficit spending and tax reduction

did| however, tend to firm
equity market.
.

ket' did

little

along in

ting

a narrow

very

The

pealed

than

groove

far in

either

sobered

future

get¬

not

list

ap¬

by knowl¬
* Treasury

i-he market in the
raise

adtliiionai

near

Armed with its

newest

$280 billion; the

national exchequer now has elbow
room
for
seeking out its new
And until

the

Street

and

the/ investment world
get

in general
better idea of what it might

havp in mind,
things will* be

consensus
a'

sidU.

bit

the

that
slow

intermediate term offering
probably up to $3 billion, with an
the

hope

tory

nine-year maturity. But
•tendency is to go slow and see

if the powers might
attempt a

bit

longer maturity.
institutional

be
away

they had

made

the

out,,to

buyers

its first cut in the

hand-in-hand

ahead,

that..the/.bulk

ings ' next week

will

via

the

several

the

negotiated
issues

route.

slated

for

had

stipulated

which

could

not

rerman

with

Robert

Ferman

interest

Co.

000

enues

With

offer¬

the

Security Associates

WINTER

the

Hines

now

with

Security

plant,

finance

chem¬

entry

62%

company's

from

operations
of
its
pipeline
division
which
purchases, gathers and transports
revenues

comes

gas.

Exchanges,

Greater St. Louis
duces

and

gas

crude

The

com¬

division

pro¬

area;

oil

oil,

condensate and

natural

and

gas

its chemical

divi¬

Tuesday, Tennessee

Transmission

Co.

has

Gas

debentures

public

ern

and

$20

million

preferred stocfcrscheduled for

offering
on

through

bankers.

Wednesday, Texas East-

Transmission

Corp.

will

and

tural

other

and

sold

for

uses.

are

agricul¬

The

Jean H.

u..

Joins A. M. Kidder
(Special to The Financial Chronicle)

DEL AND,

Fla.-^Gdrflon J. Toll
with A. M. Kidder & Co., Inc.,

Two With

Hardy, Hardy

(Special to The Financial Chronicle)

SARASOTA, Fla.

—

John R. E.

Paul W. Purmort

are

with

Hardy, Hardy & Asso¬
ciates, Inc., 1278 North Palm Ave.
now

Goodbody Adds to Staff
jJSpccial to The Finawctal=Ohronicle)

MIAMI,

Fla.

—

Robert F. Ban¬

nister has. been added to the staff
of

Goodbody & Co., 14 Northeast

First Avenue.

Joins Merrill Lynch
(Special to The Financial Chronicle)

Mil-

MIAMI, Fla.—-WilliamsJ: Claflin,
Co., wholly- Jr. has become
associated with
owned, produces weight materials Merrill
Lynch,, Piercd,, Fenner &
used in drilling oil and gas wells.
Smith, du Pont Building.
The debentures are non-redeem¬
Mud

Sales

ST.
of

new

Hough

(Special tc The Financial Chronicle)

$30 million

which

compounds

processed
white

Two With Beil &
On

—

Go;, Inc.> 305

Pipeline division gas
principally in the

Stock

3EACH, Fla.

South County Road.,

made

are

bonds,

west

PALM

Wolfe has been added to the staff
of Jerry Thomas &

Booker and

the

Jerry Thomas Adds

working

nitrogen

competing

credit

(Special to The Financial Chronicle)

gas proper¬

capital.
About

rev¬

into

business, for de¬

velopment of oil and

Mis¬

with

114 West Indiana Avenue.

Associates, Inc., 137-139 East New

"for

compared

England Avenue, members of the
Philadelphia-Baltimore and Mid-

$75,023,-

$71,093,000 and net in¬

before
special
$7,412,000 in 1956.

$30,-

only two, Georgia Power Co.'s $24
million, and Carolina Power &
Light's $20 millioh/hoth mortgage
Will'be

were

come

incurred

sion produces ammonia and other

bids.

revenues

incomd amounted to

from 1955 through 1957 primarily

pany's

PARK, Fla. —George
is

debentures

repayment
bank loans

total

net

to finance construction of

sales

(Special to The Financial Chronicle)

handled

The

yield approximately
maturity.
Mississippi River Fuel will ap¬
ply the net proceeds from the sale
toward

and

$7,086,000,

000,000

1957

sissippi River Fuel

natural

the

was

ties and for additions to

Company, Ainsley Building.

market

ranging from 100.43%
principal amount.

the

priced at 100.50% and accrued

ical

MIAMI, Fla. — Rufus A. ArtSamuel
Hohauser
and
Herbert May have become affilir

develops

new

rate

mann,

that

with

Report had it that

(Special to The Financial Chronicle)

ated

light. ,,roster

out

(jointly);

prices

Group
Mississippi

Securities
are

Hutzler

BunV Inc.; Kidder,
Peabody & Co. and White, Weld & Co;
(jointly). Bids-

good reception

4.71%

1 hree Wlth Robert

inven-

out

Federal

was reported
company may issue and sell $5000,000 of first mortgage bonds.
Underwriter — To be
determined by competitive
bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Coffin &

River Fuel Debentures
A

Bros.

★ Worcester Gas Light Co;

the drilling mud

dealers' shelves would be
.

which

soid jn the prevailing market,

Several Issues Ahead

And
inves¬

before the

company

COupon

turned
loose
by
And, since the forward

bonds

bringing

years,

just

postponed.

the

get

to which

period.

Meantime,

original of'

is that much
on

moving

disposition to look for

new

eight-

their

There is
a

currently
the refinancing operation had to

calendar is somewhat on the light
side for the ensuing fortnight, the

new

rise

for

issue

Reserve

when

sponsors.

And

the debt limit to

fully

m.V " j-j'*'"i_
They did, however,

money.

needs.

negotiate

ferine nrices

settled

rumble

issue

mar¬

direction.

Government
be

edge of the fart that th

will be

bond

peak
the

which had found the
going rather
hard at the outset. * But while this

front the lows

For the moment1 the

Shelf Stocks
Stork*
Shell

The week brought a
slightly lmproved smattering of investor interest m some of the recent issues

the

MovinMoving

Salomon

given to
would have replaced an issue of an offering yesterday (March 12)
of
$30,000,000 Mississippi River
5%% bonds sold last November,
Fuel Corp. 20-year 4%% sinking
The company, at that time, just fund debentures, due 1978, it was
about caught the
market at
its announced
by the underwriters
bottom
with
yields
near
their headed by Eastman
Dillon, Union
market

headlong

yields

and

Eastman Dillon

Co.,

where .bidding was insubsidiary of New England Elecinvestment bankers, too, 'trie System, set out on
Monday to

volved,

rush

Electric

Co.

Expected to be received sometime in
April.,

Offer

N°t Quite Ready
Merrimack-Essex

Feb. 24 it

Corp.; White, Weld & Co.

their funds, did
a

cur¬

on.

Kuhn, Loeb & Co., and American Securities
Corp:
(jointly). (2) For any preferred stoclt—Merrill
Lynch,
Pierce, Fenner & Smith; Salomon Bros. & Hutfclef andEastman Dillon, Union Securities Si
Co.* (jeiiitiy-)/ Leh¬
man
Brothers; Kuhn, Loeb & Co. and Ai Cv Allyn & Co:
Inc. (jointly); The First
Boston Cojrp.; White, Weld &
Co.; Kidder, Peabody & Co.

(jointly); Carl M.v Loeb, Rhoades

marketing, also through its bankers, $25 million of new debentures,

oni

plans to sell about

the last half of the

Boston Corp.; Kidder,
Peabody & Co.; Merrill Lynch,
Pierce, Fenner & Smith; Eastman Dillon, Union Secu¬

•"v-v

their

announced company

new securities in

type of securities has not, yet been
Underwriter—To be determined by com¬
petitive bidding. Probable bidders:
(1). For any bonds—
Halsey, Stuart & Co. Inc.; White Weld &
Co.; The First

& Co.; The First Boston

Co.

The

year.

decided

was

•

was

$12,500,000 of
rent

reported company plans to issue and sell
about $15,000,000 of first
mortgage bonds in April or
May of this year. Proceeds—To repay bank loans. Un¬
derwriter—If issue is not placed
privately, Underwriter
may be determined by competitive
bidding. . Probable
bidders: Halsey, Stuart & Co.
Inc.; Equitable Securities
Corp.; Eastman Dillon, Union Securities & Co.; and Salo¬

plans to

Gas

directors

March 4 it

Co.

Toledo Edison Co.

>■";

.(not be registered with SEC.

company

by the company

Inc., Chicago, 111.; Charles Plohn & Co.,
/New York,, N. :Y., and Clayton Securities
Corp., Boston,
;Mass.
: ;v.' /••••'
; //•'

of; capital stock to stockholders of record March
,5y 1958 at the rate of one hew share for each/five shares

-'/■■■ Sierra Pacific Power Co. (4/16)
Jan. 27 it-was also reported that the

other

Cerf

per
,

received

the

★ Wisconsin Public Service Corp*

TehA-Sign Inc., Chicago, III.
'
3, it was announced the company plans to file
with;, the SEC a proposal to issue 180,000 shares of
common stock
(par 20 cents). Price — To be deter¬
mined at time of offering. Proceeds—For
working capital

per

■■

York..

(4/21)

March

public

stock .a.t $3.25

(6/10)

authorized the sale of $5,000,000
in debentures. Proceeds—For
expansion program: Un¬
derwriter—Blyth & Co., Inc., San Francisco and New

April 21 for the purchase from it of
approximately
$8,000,800 equipment trust certificates. Probable bidders:
Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.

—To

common

expected

are

Oct.

(jointly).*

★ Southern Pacific Co.

common

offering of 500,000 shares of
y share in July, 1956../
y

Washington Natural

ly). For bonds, to be determined by competitive bid¬
ding.
Only bidders in 1956 for $4,000,000 bonds were
Halsey, Stuart & Co: Inc.; Hornblower & Weeks and

plans to register with
stock, the number of
shares and the price at which they will be offered not
yet determined.--The authorized, common stock has been
increased from 7,500,000 to
15,000,000: shares. Proceeds
the

Power Co.

reported company plans to issue and sell
or
debentures.
Underwriter—To be

determined

liam R. Staats & Co. and The First
California Co; (joint¬

/. ;

;

Registration—

by competitive bidding. Probable bidders:
Halsey, Stuart & Co.; Salomon Bros. &
Hutzler; White,
Weld & Co.; Eastman
Dillon, Union Securities & Co.;
Stone & Webster Securities
Corp.; Kuhh, Loeb & Co.
and American Securities
Corp. (jointly). Bids—Tenta¬
tively expected to be received on June 10;

announced company plans to raise in mid-

was

(jointly). Bids

$25,000,000 bonds

$5,000,000 and $6,000,000 new capital, about
through bond financing and
balance through < common stock
financing. Under¬
writer—Fox stock, may be Hornblower &
Weeks, Wil¬

/ Oct. 21 it was
announced company
/

Virginia Electric
Dec. 26 it

two-thirds of which will be

20?-/$^ -"/i.

•.

;

the

•

tuition—Expected 'on March.

1958 between

Under-

writer—Tube determined by competitive bidding. Prob? able
bidders:. Halsey, Stuart & Col Inc. and Lehman
Efrpthers! (jointly); Stone & Webster Securities
Corp.,
'V The First
Boston Corp: and Smith,-Barney & Co.
(jointly). Bids—Expected to be received on April,28. Regis>

■J.

;

Southern Nevada Power Co.
Dec. 3 it

$20,000,000 of 6%% series
new

and sell

—

Jan. 29, Frank

bonds.- Proceeds—To redeem

Corp.; Kidder, Peabody St Cd.;' White,

Eastman Dillon, Union Securities &
Co.
—Expected to be received on May 13.
About April 11.

March, 1958, $15,000,000 of first mortgage bonds. Un¬
To be determined by
competitive bidding.
Probable bidders:
Halsey,vStuart & Co. Inc.; Blyth &
Co., Inc.; White, Weld & Co.; Merrill Lynch,
Pierce,

•

■

(5/13)

bank loans and for construction
program: Underwriter—
To be determined
by competitive bidding. Probable bid¬
ders: Halsey, Stuart & Co.
Inc.; Morgan Stanley & Co.;
The First Boston

derwriter

Improvement Co.

reported company plans1 to iSiftje and sell

Weld & Co.; Merrill
Lynch, Pierce, Fenner & Smith and,

Southern Counties Gas Co. of California
Dec. 16 it was reported
company plans to issue

was

$15,000,000 of first mortgage bonds: Proeeeda^Tcr
repay

•

Inc.;

Gas

Jan. 28 it

—

(jointly); Blyth

Engineering, Inc., Arcadia, Califl

United

be determined by
competitive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Kidder, Peabody & Co.; Stone & Webster Securities Corp. and Dean
Witter & Co. (jointly).
Bids—Tentatively scheduled to
be received on April 23.
Registration
Planned for
March 25. J

/, Jan. 20 if was reported company plans to is^Ue iand sell
irl May
$16,000,000 of first mortgage bonds due 1988.

was

derwriter— To

'•

Public Service Co. of Oklahoma

Feb. 10, Leo L.
Strecker, President* announced corpora¬
tion plans issue and sale in* near
future Of $1/000,000;
convertible debentures or
preferred stock, to be followed
later in 1958 by the sale of about
$5,000,000 of common
stock. Proceeds—For
working capital and' other corpo¬
rate purposes.

able bidders:

•

(1195)

PETERSBURG,

Emery C.
g

Olsen

Browning
have

become

wjth Beil & Hough,

Avenue,

North,

Fla.

and

—

Palmer

affiliated

Inc., 350 First

members

Midwest Stock Exchange.

the

able

for

obtained
but

are

five

years

lower interest

with

otherwise

prices

moneys

cost,

callable

Frank Newman Adds
(Special to The Financial Chronicle)

March 15, 1963 the debentures are

MIAMI, Fla.—Wesley E; Mat¬
thews, Jr. has been added to the
staff of Frank D. NeWSiarl & Co;,

redeemable for

Ineraham

ranging from
the principal amount.
a

105.25% to
On or after

sinking fund at

Building.

52
I

Sovereign Investors reporting as

shows total net as¬

of Jan. 31, 1958

compared with

sets of $1,948,772.97

$1,837,746,.50
represents

1958 amounted

31,

to $10.99 as compared with $12.92
Jan. 31,

Distributors Group Appraises

the

during

The net assets per

Jan.

17%

rose

period.

chare

By ROBERT R. RICH

increase of 6% for

Outstanding shares of

Fund

came

Jan. 31, 1957. This

the period.

1958

Thursday, March 13,

■

Sovereign Reports

the

Financial Chronicle

The Commercial and

(1196)
i

1957.

In its latest interim
of

Securities Outlook

report, Distributors Group, Inc\, sponsors

Group Securities, Inc., advises that while we must continue to

"realistically
undervalued,

guard against extremes of emotion we must remain
alert to the advantage of long-term investment in
securities."
It is added that the correction

period through which we have

passing, "is further along than may appear and that oppor¬
for more aggressive investment at relatively low risk
should be watched for as the year develops."
The report comments on the business outlook and the price
position of the stocks of the various industrial groups represented
by the company's specialized funds.: These are-treated in three
categories, namely, those typically suitable as investments for:
(1) long-term growth of principal and income, (2) relative
stability of principal and income, and (3) cyclical price action.
The: industries
typically useful ! for long-term growth of
principal and income, i.e., aviation, petroleum, - chemical and
electronics, are described as having experienced temporary inter¬
ruptions in their long-term growth trends, but now appear to be
in a position from which they can resume their upward movement.
Because of the increasing emphasis given the missile pro¬
gram, together with the rising volume of orders for commercial ;
transports, aviation companies are expected to carry on at a high
level of operation this year.
Electronics, another favorite of
investors seeking long-term growth, is predicted to reach new
tunities
'

INVESTMENT
FUND

Nolmal
JUvuhuid, Seilei)

WRITE FOR
FREE INFORMATION

FOLDER AND PROSPECTUS TO

1953 in
equipment.
peaks in

YOUR INVESTMENT OEALER OR r

NATIONAL SECURITIES &
RESEARCH CORPORATION

of
as

and civilian

the production both of .military
• ' ' • *
-;

Broadway, New York 5, N. Y.

are

cited.

favored

One, the industry, "despite adverse publicity, has
a
relatively. stable and depression-resistant

Two,
cigarette sales should increase in 1958 to an all-time high. And
three, more people are becoming aware of the good values offered
by the tobacco stocks. According to the report, utility stocks have

market," which has won the confidence of many investors.

——-

w&,

done well market-wise and

Incorporated

INVESTING

for

(sfahlUh&d 1925

invested

mutual fund

securities
for possible

list

selected

GROWTH of CAPITAL
INCOME in the years

continue to offer excellent long-term

prospects as each year sees a new record established in kilowatt
output.
Both food and merchandising stocks, notwithstanding
better-than-average performance in the latter half of 1957, are

Investors

FUTURE

INCOME?

and

ahead.

NVESTING

still deemed

likely to offer attractive values in 1958.

treating the third category—investments for cyclical price
action—the Report suggests that this is the area in which later

opportunities might generally lie.
for

the

After predicting

building

Automobile and steel stocks

represented to be experiencing

are

INCOME?

izzz'rn
"

:a.b8tit°;rd
^
Sk of
Pnncinr.1

record year

industry it proposes that in the light of this
prediction the fact that the industry suffered "a rather sharp
correction" during the past eighteen months suggests that building
stocks may well be among the first to recover with a revival of

CURRENT

CURRENT income

prospectus

each

fund is available from
your

investment dealer.

periods of uncertainty with no definite or immediate prospects for
an upward
movement. Both industries are expected to produce
less this year than in 1957, but are commended to the investor's
attention for later opportunities. ;
' w,-.' *• - ;
_

the

The

report points out,
impressive evidence in

was

seek

who

investors

1957

long- Necessarily,*

Group, industrial machinery,
mining and railroad equipment stocks have not as yet shown any
positive indication of reversing their unfavorable trends and as
a result, should be approached with caution.
With regard to the
situation of the railroad industry, the report has this to say:
"Although some decline in the volume of railroad traffic is ex¬
pected in 1958, a higher rate schedule should hold total gross
revenues fairly close to those of 1957."
The

investor

advised, in spite of the declining'trend in
price action, to be alert for a "long overdue reversal."
Favorable comment also is given with respect to the values and

Berkeley Street

attractive current return offered by

well-selected railroad bonds.

Boston, > Mass,

growth

electric

which now

products,

the $14

17.4%

constitute

mil¬

cuts

Substantial

lion-portfolio.

Colonial's First

each of Ford

Motor, Gen¬

eral Public Utilities and Hallibur¬

Quarter Results
The Colonial Fund in its
to

shareholders

fcnded

Jan.

increase

investment

31,

report
for
the quarter
1958 shows an

assets

available

Oil

ton

for

$43,308,000
from
$39,973,000 at the end of the pre¬

and

Well

each

Cementing;
El

Socony

Paso

Mobil

2,000

Electric

Oil;

5,000

shares of Gulf Interstate Gas and

ing and steel groups. Largest individual holdings

issues, as Jan. 31,
Standard Packaging Corp.,
the 45

among
were

American Air Fil¬
ter
Co., American Bosch Anna
Corp., and Ampex Corp.
v
Jan. 31.

Jan. 31

195?

195K

Total

(N.

J.).

Oil

Standard

included

Sales

4,500

tions..

Long-Sliort View

Assets— $14,075,933 $14,331,090

Net

book of Instituiional Funds
present adjustment
of business activity is expected to
bottom out during 1958, to be fol¬

states that the

lowed

-—A If. S.

incorporated mutual fund

advance

"$8.42

$9.57

foreseen for the year

0.03

0.11

Per

months).

"Adjusted

tribution of $1.35 per

7 (Aug. 1, 1957 to Jan. 31, 1958)
Additions

Brunswick-Balke
Collender

4,000

3,500
4,800

Shulton, Inc. "A"
Shulton, Inc. "B"

10,000
12,000
10,400
8,400

viding diversified, managed investment in

CALVIN

are

possible

income

established 1894

long-term

growth

for

Prospectus

ONE WALL STREET, NEW YORK 5

objectives
its

upon

this

Name

—•

Chicago

—

Atlanta-;

—-

and
shareholders.

growth of the
in the years

economy

ahead, including the current em¬

research

for

defense

phasis

Dayton Rubber
Garrett
Martin Co.

developments generated by recent

scientific

Russian

this, industry

can

advances.

be expected to

9,000, Ventures, Ltd.

American Fund
Share Value and
Assets Gain
American
corded

Mutual

increases

both

Fund
in

re¬

net

as¬

sets and in net investment income
for the three-months
Jan.

accordig

31,

period ended

President

Jonathan B. Lovelace in his report

the

shareholders

for

the

first

quarter of the Fund's fiscal year.
Total net assets at Jan. 31,

$66,213,808,

were

CFC

Prospectus from

1953

equivalent

your

per share on the 9,193,364
shares outstanding. This compares

$7.20

investment dealer'

PHILADELPHIA 3, PA

at 'Oct.

1957, equivalent to .$7.15 per
share on the 8,921,330 shares then

31,

thinking of

outstanding.

income, excluding realized
gains on sales of securities, in the
three months ended Jan. 31, 1958
Net

$664,332

was

cents

per

FUTURE
INCOME

approximately

share on the aver¬

Send for Prospectus and

number of shares (9,041,341)
outstanding during the quarter.
age

This

Descriptive Literature

on-

compares

INC.

Nucleonics,
Chemistry

Electronics SHARES, INC,
...

professionally managed

Mutual Fund

concentrating its

investments'in

these 3 industries.

N.C.E. SHARES DISTRIBUTOR

10 E. 49fh ST.

• NEW YORK

17, N. Y,

request

Los Angeles

services

healthy

■

Namfe

•

New York

and

Clevite

Fund

capital

■

Addrett

Selected Investments Co.

Loiid, Abbett & Co.
!

goods

outlays.

tinued

Prospectus from your dealer or

Address

all

Common Stock Investment Fund
Investment

BULLOCK

American

american

Canada. For free prospectus mail this ad to

some

Concerning the long-term out¬
look, a number of factors are seen
at work which point to a con¬

Sundstrand Machine Tool

11,200

exports

manufacturing indus- '*
Gross National Product, the

value

1957

Eastern Industries
Hagan Chemicals
Hilton Hotels
Maryland Casualty

11,500
5,030
25,000

is1

1958 declines

produced, is expected to be main¬
tained* at
a ; high
level.
Home1
building and government spend¬
ing, at municipal, state and Fed¬
eral levels, are expected to exceed

Investment Changes

12000

tries.

the

years.

expenditures,

capital

and in

include capital gains dis¬
share on July 5, 1957.

recent

resumption

7,000

Selected

Fund

pro¬

1,497,123

Asset Value Per Sh.

*
the

near-term projection,

year,

Affiliated

B usiness Outlook

with $503,941 or
vious fiscal quarter. For the same
approximately 7.12 cents per share
1,500 shares of Kennecott Copper
period, the asset value per share
on the average number of shares
and 2,000 shares of El Paso Nat¬
rose from $8.26 to $8.46.
(7,074,573)
outstanding
in the
ural Gas $5 convertible 2nd pre¬ three-months
period ended Jan.
Principal purchases of The
Colonial
Fund
for
the quarter
ferred.
31, 1957.
shares of Royal Dutch Petroleum,

;

Shares Outstanding:1,989,552
No.
Shareholders—
9,074

135 S. La Salle St., Chicago 3, HI

I Cily
•

•

and undertake

Polaroid Corp.,

7.34

5,802

and share underwriter
management func¬

the sponsor

made in the metals and min¬

were

with d total of $63,763,099

ended Jan. 31, 1958 included 1,000

is!

information

regard interim de¬ currently available for publication f
as to the form the proposed fund /clines as advantageous buying op¬
will take or the initial capitalizeportunities."
V -1'*.
In any event, the in- *
In the six-montli period, Kcy- tion,'etc.
vestments banking firm would be r
stone almost doubled its holdings
term

opinion of Distributors

"relative

The Parker Corporation'
200

six open-end or "mutual" calibre. If
present plans materialize, formal,
"There announcement of the step \yill be
made at mid-summer at the latest.

the

for

report

months ended Jan. 31.

Eliminations

the economy.

for

lARGE

semi-annual

with

Field

Purchase of shares of Keystone .'Lehman- Brothers, .prominently
Low-Priced Common Stock Fund identified with the famed closedS-4 exceeded redemptions by a end Lehman Corporation, is giv¬
ratio of almost 6 to 1 from July ing very serious consideration to
to
December, according to the the creation of a fund of the

Three favorable condi¬

the belief that this trend should continue.

been

Wi
m-.:y

Filter Mutual

High Rate

May

■,

Income

providing investments for relative stability
principal and income, the Report mentions the tobacco industry
the star performer for the past year or more, and states

tions

Of the industries

Eitabliihed 1930

120

Lehman Bros.

that

been

A MUTUAL

Kevstoue S-4 Sales

•

Volume 187

Number 5724

...

The Commercial and Financial Chronicle

(1197)
produce
well

products for military

new

domestic consumption.

Another plus

factor is popula¬
growth-more
people
each

tion
year

need

both

this

goods

and

services,
and in the

country

rest of the world.

Continued from page 6

Managed Funds
Makes
Report
For
Quarter
gains

net

Bullock Bullish

28th.

and

dustrial

and

commercial

Broadway, New York 4,. N. Y.
•

Bullock Fund, Ltd., continues to last

•growth of the electronics

as¬

They

sion

markets

also
of

Finance
Co.—1957
Annual
Report—Beneficial
Finance Co., Beneficial
Building, Wilmington, Del.

place emphasis on the selection of 257,346 on Feb. 28th a year ago.
1957.
stocks of companies
appearing to The asset total at the end of the
have favorable long-term
growth 1957 fiscal year, last Nov. 30th,
characteristics.
"

Amounts

invested

the

drug

and medical supplies field and the

' amounted to

Corporation—Report—Joseph Faroll & Co., 29
Broadway, New York 6, N. Y.
Delhi Oil Limited—Appraisal—Wisener and Com- >
7' pany, Limited, 73 King Street, West, Toronto
1; Ont., Canada.
/Cenco Instruments
Corporation—Analysis—Land, Bissell &
\
Meeds, 120 Broadway, New York 5* N. Y. Also available is
; an analysis of Giant Portland Cement Company.
!(•" 'V. ?

expan¬

■

•

million

of which
1957, and

other, semiconductor

Shares outstanding on Feb. 28tli

Canadian

ireached

devices

record

expanding markets for their ended
amounted
to
$3,573,276,
products and the substantial in¬ slightly above the
$3,562,267 to¬
these
companies
are tal for the like period a year ago.
making in research and develop¬ Sales during the last quarter of
vestments

ment

make

them

attractive

companies whieh may be among
the leaders in the next
upward
surge of the economy.

At Jan.
of

the

which

and

were

82.05%
stocks

mon

31, 1958, total net assets

fund

sented

represented

repre¬

Government

which

com¬

and- 17.95%

cash

$32,553,824,

bonds

constituted

re¬

for the acquisition of addi¬
tional stocks as occasion presents.
As of Nov. 30, 1957,7 the fund's
fiscal year-end, total net assets
serves

were

$31,784,253.

EIA

and

The

vancement

Fund

the

Christiana

Broadway, New York 5, N. Y.
•
Machine Company—Analysis—Securities
Corporation
Iowa, Merchants National Bank Building, Cedar Rapids,
.Iowa.
,7'-. 7/ '
Collins
Radio—Memorandum—Hemphill, Noyes & Co., 15
Broad Street, New York 5, N. Y. Also available is
a memo¬
.

randum

Ad¬

Continental

"By

many of the usual
of comparison, our

able is

Report

i.;'..."

Dixon

j Oliver Goshia Joins

Donchian said.

In his message to
shareholders,
he stated, "Our portfolio of

would

some

commodities
tions

and
If

net

trends

short

posi¬

change,

ac¬

York

Young,

Canada.

un¬

Record
In

spite

record

New

Building,
York

and

members

Sales

for

mentioned

each

months

the

above

1958

compared with similar months of
1957 are:

Corporation—Report—Thomson & McKinnon,
Street, New York 5, N. Y.
Manufacturing Company—Report—Loewi &
Co., Incor¬
porated, 225 East Mason Street, Milwaukee 2, Wis.

Midwest

Stock

business in Toledo.

and

Arthur

staff of

William B. Denny Joins
CHICAGO,
111.
u
^
Denny has joined the trading deT4

Group, Inc., national
and investment advisor of

School News.

Ray Jacobs Joins
Kalb, Voorhis & Co,

rep¬

J. Tobias have joined the

sponsor

Also
brief analyses of

Walker

the

over

Distributors

stock

are

II Wall

Bank

£a
Co.,

,oo

7
South

market un¬
209
La Salle Street.
certainty during the months of Group Securities, Inc., $100,000,- Mr. Denny was formerly with
000 mutual fund.;V
January
and
Manley,
Bennett
& Co. in Detroit,
February,
1958,
The firm also announces that their
Wellington Fund sales for the two
Mr. Fribush, a native of Albany,
new teletype numbers in
month period were higher than
Chicago
New York, is a graduate of Ham¬
the
are CG 3333-4-5.
similar two months period
ilton College and the Columbia
during 1957, according to A. J. Law
School, where he was editorWilkins, Vice-President.
in-chief
of .the * Columbia
Law

Ltd.—Analysis—Amott, Baker

Broadway, New York 38, N. Y.

same

United Aircraft

Oliver Goshia

Progress Dempsey-Tegeler & Go.

Fribush

Company, Amoskeag Com¬
Utilities Co, Also available is the current
tabulation of Real Estate Bond & Stock Averages.
Telechrome Manufacturing
Corp.—Study—Amos Treat & Co.,
Inc., 79 Wall Street, New York 5, N. Y.

until the end of April."

Martin

7 "7-77'. 7
Company—Review—McLeod,

pany, and Citizens

are supported
by (1)
bearish supply-demand picture Research Corporation.
This
ahd<(2) a strong seasonal ddwn- resents an increase of 6%
the similar period last year.
ward
tendency
from
January

Wellington's

New

Standard

$13,762,000 according to figures
released by E. Wain Hare, vice- Exchanges. In the past Mr. Goshia
conducted
his
own
investment
president of National Securities &

Personal

bulletin

"ABC Investment Letter",
Columbia Gas System, Ohio Oil

1958

trends which

Power

Shell Transport & Trading
Co.,
& Co., Incorporated, 150

At New Record

and

Co., 36
is

Shawinigan Water and Power Company—Detailed
Analysis—
Cochran, Murray & Hay, Dominion Bank Building, Toronto,

any

National Sales

all-time

Water

Weir &

14, Ohio.
Wall Street,

available
-'*•"****•

Shawinigan

in the

Also

Brands.

founded."

established

Oats—Bulletin—Bache

5, N. Y.

Company, Limited, 50 King Street, West,
Toronto, Ont., Canada.

cording
to
our
tested
trenddetermining rules, any or all of
Investors' purchases of National
these positions can be reversed
Securities Series of mutual funds
quickly/'
for the first two months of
"Our largest position is on the
short side of coffee, taken on the
basis of technical downward

Cement

Quaker

open

commodity futures positions now
Shows
nefc«long positions in 7

Coun¬

Mohawk Rubber
Company—Analysis—J. N. Russell & Co., Inc.,
Union Commerce Building, Cleveland

now

drastically in
sustained decline were largely

—

Street, St.

.7".77/.'77

Company—Analysis—Hayden, Stone & Co., 25
Broad Street, New York
4, N. 'Y.77/777'77.7777'. V
Mississippi Glass Co.—Memorandum—Doyle, O'Connor &
Co.,
135 South La Salle
Street, Chicago 3, 111.

Staff of Prescott & Co.

that funds

suffer

«fc

Ideal

in mutual funds. And it has been

that the fears of

Chemical

Electronics—Memorandum—Woodcock, Hess, Moyer &
Co., 123 South Broad Street, Philadelphia 9, Pa.
Hazel Park
Racing Association Inc.—Report—M. J. Reiter
Company, 60 Wall Street, New York 5, N. Y.

apparent for several months

Alaska Airlines.

Corporation.
G.

value per share in¬
$5.08 at Dec. 31, 1957,
from $2.84 on Dec. 31, 1956, Mr.

Friden, Inc.—Report—Dean Witter & Co., 14 Wall Street, New
York 5, N. Y.
Also available is an analysis of Transamerica

•

Conklin

Co.—Memorandum—A. M. Kidder & Co., Inc.,
Street, New York 5, N. Y.

Louis 1, Mo.

far

asset

; able is information
on Northeast Metals Industries.
Emerson Electric Manufacturing
Company — Report
selors Research
Corporation, 411 North Seventh

as the future of mutual funds
CLEVELAND, Ohio — Oliver
Futures, Inc., " the commodity is
concerned—was the overall per¬ Goshia
is
now
associated
with
fund, had total net assets formance of
the
fund
industry Prescott
&
Co.,
National
City
of $281,793 as of Dec.
31, 1957,
during the period. -7
'
compared with $173,293 at the
:
close of 1956, Richard
"Neither the recession nor its
Donchian,
fund manager, announced March effect on the market has seriously
4 in a report to stockholders.
shaken the confidence of investors
"

Net

Research—Information—Pearson, Murphy
Co., Inc., 50 Broad Street, New York 4, N. Y. Also avail-

creased

14, Calif.
Corporation—Bulletin—De Witt

Motors

bulletion

I Wall

mutual

Co.

Detroit Edison

stand¬

opening
quarter was an extremely grati¬
fying one," Mr. Slayton said. "But
perhaps even more gratifying—as

Futures, Inc.

.";**•

National Tea

Organization, 120 Broadway, New York 5, N. Y. Also avail¬

•

Commonwealth of Kentucky—Bulletin—Robert H. Huff &
Co.,
210 West Seventh
Street, Los Angeles

were

•

Co.,?
Angeles" 14, Calif.
; /
i
Co.—Bulletin—Laird, Bissell & Meeds,<

ards

120

already
effectiveness of

has

Securities

Clinton

Education

Makes

for

N. Y.
-v-/
Central Valley National
Bank—Analysis—Holton, Hull &
210 West Seventh
Street, Los

proved the
a teaching tool in both ^ele$3,938,632.
mentary and high schools. Several
colleges and universities are find¬
Mr. Slayton said last December's
ing it equally potent for institu¬
sales were $1,126,950, the largest
tions of higher learning.
ever for
lhat "traditionally slow
month" and 33.9% higher than the
| With the rising national interest
in better educational opportunities
December, 1956 total. '
for our youth, augmented by the
The
ratio -of
redemptions to realization of our
neglect of the
sales for the quarter was still far
sciences,
television
provides
a
below the fund industry
average,
and
effective
means
for
ready
although slightly higher than dur¬
overcoming the shortage of teach¬
ing the like 1957 period: 12.7%,
ers and bringing the best teaching
compared with 11.9% a year ago,
talent to the greatest number of
and 6.4% during the three months
pupils.
■'
;
ending last Nov. 30th. 1957

Central Hudson Gas & Electric Corporation—Annual
Report—
Central Hudson Gas & Electric
Corporation, Poughkeepsie,

are

18,536,171, com¬ revolutionizing the application of
chemical industry were increased
electronics to industry and com¬
pared with 17,455,484 on Nov. 30th,
merce.;
1
i : u 7
during the three months ended and
14,509,454 at the close of the
Jan,
Closed-Circuit TV
31,
1958,
Hugh
Bullock, first 1957 quarter.
7\7"f;
President said,
and
substantial
Closed-circuit television, which
The fund group's total number |
positions continue to be main¬
until recently has been confined
tained in the petroleum, steel and of shareholders on the same dates
largely
to industrial uses, promises
aircraft and defense groups. While were 19,000 (a new high), 18,755 to
give educational television new
the so-called "growth" stocks are and 14,780.
:
life.
The
national
experiment
sensitive to changes in the busi¬
The dollar volume of share pur¬ being conducted at
Hagerstown,
ness
outlook, he reported^ the chases during the quarter just Md., under the co-sponsorship of
at a

were

Burroughs

■

the

|; The transistor, sales

$48,293,387. ;

industry.

further

assure

study of

Co., 1529 Walnut Street, Philadelphia 2, Pa.
Beneficial

servicing business,
Which amounted to $1.2 billion in

month* compared with $48,-

Company—Review—Boenning &

fund group, disclosed total net
sets of $48,534,137 at the end

Also available is

Emerson Electric Manufacturing Co.
American National Insurance

On Growth Stocks

-a

Recommendations & Literature

offer the greatest
long-range op- |
Slayton, president of
for
the
continued
the nationally-distributed mutual portunities

Hilton

For 1958: Baker

assets

the

Feb.

page

ping

up in missile output should
the study reasons;, sales and a
"very small" rise in more than compensate.
long-term
implications
are the
redemptions - to - sales ratio
While military uses of
electronic
that demands on
industry for new over the 1957 first quarter were
equipment are perhaps the most
and
better
products
will
be reported
by Managed Funds, Inc. important at present to our na¬
tremendous.
for the three-month period ended tional
welfare, the expanding in- i

Therefore,

■

from

Electronics Outlook

Slight

Continued

John H. Cowie With

Mr. Tobias, a Brooklyn resident,
attended
James
Madison
High

wrAcmMPTmT

WASHINGTON

Jacobs,
D.

for

m e r

-d

Form Cherokee Sees.
,

CSpccial to The Financial Chronicle)

SOUTHERN

Cherokee

Ray has

—

Washington,

distributor of Financial

In-

formed with offices at
jjg jjortbwest Broad Street to en-

gage

?rustr*al
Voorhis
D

ias ^?jnKd Ka*b>

Co.

He will be work-

7
Washington,
office, Woodward Building,

where

charge
dealer

Ferd

Thomas

President;

Thomas

Vice-President;
Hufflnes

business.

C.
C.

Of-

Darst,

Jr.,

Darst

Jr.

and

Robert
L
Vice-President and

Jr
•

Wj»ui
. utunc
~
& Webster
uc
vijoivi
▼ ?

Ray Jacobs will concentrate

sales training for the
njutual fund
field and will serve as a special

consultant

securities

are

the

quarters.

Moore, Leonard & Lynch

ficers

Nauheim, partner in Secretary
firm's broadening
service, makes his headof

PINES, N. C.~
Securities Corporation

been

contractual plans.

With Allen In v. Co.

Richard

Hamilton

has

be-

associated with Stone &
Webster Securities Corporation, 90
Broad Street, New York City, in
the municipal bond department.
come

With the Alan Co.
graduated from Yale
John H. Cowie has become asso(Special to The Financial Chronicle)
University in 1954. At both schools cited with
(Special to The Financlal Chronicle)
Jan.
C.
Moore,
Leonard
&
DENVER,
Colo. —Howard
$9,772,000
$9,224,000 he
participated
in
competitive
ji
k
MIAMI BEACH, Fla.—James H.
Feb. —7,754,000
8,315,000 swimming.
Subsequently, he at¬ Lynch, 14 Wall Street, New York Fordliam has joined the staif of Webb has become connected with
tended law school at the Univet- City.
Mr. Cowie was formerly a Allen Investment Company, 282.9 The Alan
Company, 411 SeventyTwo mos. $17,526,000 $17,539,000
sity of Virginia.
I •partner in Starkweather & Co»
"" East Second Avenue.
first Street.
School.

1957

1958

„

(1198}

The Commercial and Financial
Chronicle

The

Indications of Current

Business Activity

week

month available.

month ended

Thursday, March 13, 1958

production and other figures for th*

cover

Dates shown in first column

either for the

are

"tl I
J%2s.

Latest

AMEB1CAN IKON AND STEEL INSTITUTE:
indicated steel operations (per cent capacity)

following statistical tabulations

latest week

Week

—Mar. 10

Prevloui

Month

Year

Week

Ago

§53.1

Equivalent to—

*32.8

53.5

Latest

93.8

Prevloui
Month

Month

ALUMINUM

(BUREAU OF MINES:)
1
Production of primary aluminum in
the U. S.
tV*
(in short tons)—Month of November!—
Stocks of aluminum (short
tonsjyend pf Nov/

Year

Ago

Bteel

Ingots and castings (net tons)

Mar. 16

—

AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output—dally

§1,442,000

1,446,000

2,401,000

6,807,635

6,842,385

7,518,615

7;506,000
25,937,000
2,366,000

7,548,000

8,076,000

27,040,000
2,486,000

26,723,000

6,841,285

stills—daily average (bbls.)
output (bbls.)

Feb. 28

Gasoline

117,560,000

Feb. 28

Kerosene

26,731,600

output (bbls.).

Feb. 28

2,775,000

—

Distillate fuel oil output
Residual fuel oil output

(bbls.)

Feb. 28

(bbls.)—

Stocks at refineries, bulk terminals, In transit, In
Finished and unfinished gasoline (bbls.) at

Feb. 28

Kerosene

(bbls.) at
Distillate fuel oil (bbls.) at

7,520,000

-Feb. 28

215,191.000

oil

(bbls.)

12,008.000
;;

•

CIVIL

7,769,000

7,497,000

203,774,000

37,064,000

Feb. 28

88,638,000

96.6G8.000

.Feb. 28

54,208,000

55,435,000

57,502,000

452,389

550,426

Feb. 28
—

—

CONSTRUCTION

14,175,000

*213,116,000

204,559,000
23,179,000
'123,121,000

'.v

8,572,000

Mixed

construction

17,167,000

18,596,000

85,698,000

553,645

538,353

and

480,628

533,316

—Mar.

$322,937,000

$320,433,000

168,294,000

182,733,000

161,972,000

128,238,000
176,427,000
132,177,000

154,197,000
166,236,000
147,716,000

34,875,000

44,250,000

Mar.

municipal

196,847,000

Mar.

anthracite
STORE

SYSTEM—1947-49
EDISON

ELECTRIC

Electric output
FAILURES

(tons)——

SALES

AVERAGE

Benzol

AND

DUN

—

(St.

;

—

100

Louis)

11,803,000

12,289,000

Mar.

358

331

342

y 827

5.967c

Vw 5.670c!

Mar.

4
4

$66.49

Mar.

$66.42

$64:00

$37.67

$37.33

$36.67

$50.50

5.967c

24.425c

24.375c

24.575c

20.350c

19.725c

20.475c

Mar.

13.000c

16.000c

15.800c

Undesignated;,—.

10.000c

13.500c

26.000c

25.000c'

93.125c

98,625c

Mar. 11

94.34

..—Mar. 11

Mar. 11
-

—

94.40

94.25

95.62

95.92

96.54

102.30

102.80

101.47

99.52

99.84

99.36

99.20

95.16

94.84

96.07

96.54

86.51

86,78

86.65

91.62

89,78

91.77

91.62

95.47

Mar. 11

<0. 8 Government Bonds—

96.85

97.00

98.09

Mar. 11

98.25

'..

in,,,.

i—...

;

Production (tons)
Percentage of activity.
Unfilled orders (tons) at end
of period!
OIL, PAINT AND DRUG REPORTER PRICE
AVERAGE

ROUND-LOT

2.99

4.03

4.01

3.76

4.08

Mar. 11

4.67

4.65

4.66

Mar. 11

4.43

4.30

4.29

4.30

Mar. 11

4.04

3.95

3.94

3.87

3.94

3.61

_Mar. 11

3.86

Mar. 11

397.0

396.9

..Mar.

289,414

230,020

__Mar.

264,351

272,590

Mar.

159

Mar.

3.58

3.86

3.90

397.0

411.8

241,750
244,049
'

362,954

330,479

340,841

109.47

109.33

108.63

TRANSACTIONS

Fel}

—Feb!

Other

transactions initiated

Total

purchases
Short sales

1,628,660

324,310
1,227,380

394,750

f,276:080—

—1,-661;600.

1,349,890
..

_rl,744,640
%zjn
"

279,170

78,300

35,900

390,820
434,820

320,170

307,230

398,470

343,130

—

Short sales
sales

275,860

325,460

.Feb. 15

427,380

.Feb. 15

92,960

.Feb. 15

Total sales
.

iFeb!

507,090

541,977

659,935

550,985

143,760

278,620

131,050
651,112

632,872

A 7.1,415

—Feb. 15
round-lot transactions for account of
members—

600,050

776,632

750,035

782,162

—Feb. 15

2,053,580

2,407,597

Feb. 15

410,390

2,682,265
751,670
2,141,475

2,492,315
447,110
2,389,252

2,893,145

2,836,362

■

_______

sales
Total sales

...Feb. 15

1,791,200

Feb. 15

2,201,590

2,763,142

STOCK

TRANSACTIONS FOR ODD-LOT ACCOUNT
OF ODDLOT DEALERS AND
SPECIALISTS ON N. Y. STOCK
EXCHANGE
SECURITIES EXCHANGE
COMMISSION:
Odd-lot sales by dealers
(customers' purchases)—t
Number of shares—.

Dollar

1,336,171
$57,892,492

1,388,699

1,543,897*

Feb. 15

$47,003,911

$59,718,097

$70,071,092

.Feb. 15

928,044

1,013,055

Feb. 15

948,903

1,184,517

24,192

20,961

18,465'
1,166,052"

value

903,852

.Feb. 15

$41,292,892

992,094
$45,785,039

35,357
913,546
$40,765,537

Feb. 15

276,190

233,770

195,840

275,810"

276~190

233" 7 70

195~840

275~810

Number of shares—Total
sales
Short sales

Feb. 15

sales

Number

Feb. 15

]

100

round-lot
Short sales
Other

Toff)

.Feb. 15

All

—

Industrials

(1947-49=100):
—roup—

Insurance

740,730

Feb!

903,330

9,771,580

11,922,930

1,291,120
11,358,970

13,481,900

10,512,310

12,826,260

12,650,090

14,219,820

•.

commodities other

^■Revised figure.
1958»

pound.

middle

than

farm

and

^Includes 311,000

foods

119,925-

181,024

118,564

21,059,000

21,075,000

17,950,000

18,144,000

21,564,000
y,18,725,000

10,199,080

7,309,000

408.0

tO.790,000

365.4

68.7

—;

••

431.6;

72.8

116.8

.Mar.

99.0

97.3

94.2

88.5

109.5

109.7

108.4
"

$31,222
*; "..22,351

YIELD
of

$53,573

$31,834,000

from

Stocks

end .of

(at

y$30,660
.21,635.

V $52,295

*27,221

$31,661,000

$31,790,000.

Jan!:

.v-

.4.40

4.58

6.79

8.31 '

.4.64

4.69

4.13

6.26'
4.80

"•

•

4.93'

5709 ~~

3.16

3.46

4.56

4.77

—4,^44-

3.15
•

•

4.31'

)

(BUREAU

MINES)—

«*f

Production (barrels)

Shipments

*,22,360
$53,861

-26,684

——.....

*$31,511
.,

•_!_!

December:

'. Capacity used

2——"

—

mills

: 25,014,000

22,386,000

(barrels).

.month—barrels)—
(per cent)—

16,834,000

20,829,000

28,550,000
73

23,187,000
y *
' 84

$824,758,544

$829,920,692

683,636,843

065,969,774

_———

•

24,429,000

,7:17,822,0001
y22,440,000
•; ;
'83
„

RAILROAD EARNINGS CLASS I ROADS
(AS¬
SOCIATION OF AMERICAN RRs.)—Month
Total

Taxes.
Net

(

revenues_l___2—.
expenses-

l~s

__1

-8-2.89 " •'

___'J—j—j.i,——=——

MANUFACTURERS

INC.—Month
■

operating

railway operating income before charges
income after charges
(estimated)

RUBBER

December:

—2

$57,400,769

;

$870625.946

•

^688686,137.
'

65,879.126;
"97.000,000*

46,000,000

■

(Number of)r-

5,739,277
6,597,263

"7,098,030

19,817,850

18,960,004

6,220,370"

16,568,558
"7,406,531

X6,493,813

y :

4—

Production

64,243,357

■

72,000,000 '

L—II—-

Truck and Bus:Tires

58,977,906

80.24

>79.13'
'$77,017,138 yl$74,270.754'
'

ASSOCIATION

Passehger Tires"(Number qf)—

Shipments
1

-:r

Tires:!(Number .of)!—

820,194
1,018,089

950,989

1,149,906

3,407,557
.

'i-

.Mar.

103.6

103.7

99.1

80.6

125.8

125.3

3y210,873*

'.182,795

-j

960.678.

>1,130,382

852,026

Tubes

(Number

C.—:

——J.

Tread

-Shipments

L„

Production

Inventory
ZINC

OXIDE

(pounds)
(pounds)
(BUREAU

of December:
Production (short
.

Shipments

—

246,236"

■772,072*

2,717,439

-2,735;619

t2;837,451

3,242,647
7,444,444

2^69,575

7,670,868

——

258,231

'767,299

2,777,860

(Camelback)—

(pounds)

Rubber

6,109,425

36,070,000
33,136,000

37,377,000

37,656,000

25,061,000

27,681,000

<•-26,524.000"

34,771,000

37,641,0001

MINES)—Month

tons)^—!,

(short tons)——:
:L„
Stocks at end of month (short
tons)

•

214,134-

Bus Inner

and

of)—

3,377,991

188,468
-

261,067

Passenger, Motorcycle, Truck

103.5

.Mar.

''
^'

76.5...

dollars):

omitted)———

AVERAGE

Inventory
118.6

barrels of foreign cru1e runs.
§Based on new annual capacity of
140,742,570 tons
1957 basis of 133,459,150 tons.
tNumber of orders not reported since introduction of
tPrime Western Zinc
sold on delivered basis at centers where
freight from East St. Louis exceeds

*84,446*

176,287

•

119.2

109,707

ArSer,* Tel'."7E'--

CEMENT

Month of

as against Jan. 1,

Monthly Investment -Plan,
a

119.4

:v t

139,150

COMMISSION—

737,920

.Mar.
.Mar.

Meats

'nj

(10)

(200)

PORTLAND

652,840

pPh

H-

109,556 y'

(125)

Shipments
>

"103,898
136,135

1,836,000

136,748

STOCKS—Month

(not incl.

Average

cominudltles

one-half cent

(millions

(OOO's

Tractor-Implernent

u7~S. dept." of

products
Processed
foods

fhi

676,810

108,264

•

rh-fit

pfjh. 15

Farm

All

582,190

'•:

sales

Commodio.

WEIGHTED

COMMON

Utilities

members (shares):

sales

—

412,030

■'

t''

44,025.000 V,. vj|
2,639,000-'*'

January:

sales-

wholesale prices, new
series
labor

Dec.

Production

sales on the n. y. stock
i££hange and round-lot stock
for account
transactions
of

36,290,800

"RailrDftd5u(26L

$55,941,254

Total

MOODY'S

st0ck

A.—

2,801.

37,120,000
2,197,000

•

...

Other

Round-lot purchases
by dealers-

___2.2—

operating,
Operating ratio

..Feb.15

Round-lot sales by dealers—

Total

Net

—

y.y,

-tonsl'lLi.!'—yl

month

Railway Employment
January y 1947-49=100)

"of December:

♦

2,870

tons)!-—

(net

(riet

Total

1,068,724

-658,151

:,:2l"u90

Nondurables

Feb. 15

total sales

—

Dollar value
Odd-lot purchases
by dealers (customers'
sales)—
Number of orders—Customers'

lignite'1

Month of .December
Inventories—

512,070
2,251,072

Other

Customers' short sales
Customers' other sales

Total

purchases
Short sales

-7, >479.392

MANUFACTURERS' INVENTORIES AND SALES
(DEPT. OF
COMMERCE)- NEW SERIES—

*•: -*:*?*■. r.-:

393,670

44,000

transactions initiated off the floor—
Total purchases

Index

•

1,430,910
1,711,070

49,600

M75,958

•74,836
-

;y/
and

anthracite

INTERSTATE COMMERCE

316,420

Feb'

239,990
16i;5"32

V '^y

—L„y

spindle hours j(000's omitted) Feb. 1
Active spindle hours for
spindle in place Feb.

230,160

380,420

111,262

2L-~2.

-Active

1,662,160

'.!>'
/

<■'

;

(DEPT: OF COMMERCE):
Spinning spindles in - place on Feb.' Is
Spinning spindles active-011 Feb. 1

110.97

Feb
~

tonsi_2—

-jy
2.721,573f<

4,150,987
'

COTTON SPINNING

454,345

——Feb

——

Total sales

Total

1,485,200

the floor—

sales

Other

1,309,780
-267,830
1,008,250

15
on

^sp,

—

Other

lg
15

3,729,990

r t 270,422

—

tons)

A/(tons of 2,000 pounds):!!—'.
Refined copper stocks at end of
period (tons
of 2,000
pounds).......^—

lotal sales

(net

Sales y._—_——.2

r——15

■v:,'!,v?.v!{!,m5

FOR ACCOUNT
OF
MEM¬
BERS, EXCEPT ODD-LOT DEALERS AND
SPECIALISTS:
Transactions of specialists.In stocks
in which registered—
Total purchases
1

S^L~

(net

350,780
266,246
>

•>

}■

y-v';y

l-'V?.'!! ".;'•" '■ *

(tons of 2,000 pounds)—
(tons of 2,000 pounds).2_i
Deliveries to fabricators— -•

INDEX—

JVIar.

—

Pennsylvania

3.97

rWl'-nt
yy, 114,656' -r

8,403-

,r-'

Refined

3.80

4.00

55,941

'.Crude

3.66

3.79

America

Copper production in

3.97

3.62

ti-i•)

6 304
'•

•

3.26

4.06

100

2.98

V" " 3.78

INDEX.

—

Mar. 11

Industrials Group
COMMODITY

4.03

Mar. 11

„

NATIONAL PAPERBOARD
ASSOCIATION:
Orders received (tons)—

2.98

Mar. 11

-h.

*•>

—_i.—i-f-~16,123

COPPER INSTITUTE—For

97.62

-JVlar.ll

——

Baa
Railroad Group
Public Utilities
Group-

Mar. 11

South

of January: ~
Bituminous coal

97,00
•

3,492

y 48,787

anthracite

America

90.84

95.62

102.13

fi.

-6,174

COAL OUTPUT (BUREAU OF
MINES)—Month

Mar. 11

tons)

14.000c

lO.OOCc

corporate

(net

12.800c

94.500c

V 401

tons)—y_—22—2—L143,037

10.500c

26.000c

-I,

(het

12.800c

10.000c

i--.li .ii..

Europe

To Asia

Central

10.500c

95.125c

Ju"':

_—y_2__2—2121

12.800c

26.000c

-297,106,000: "
; '17.-622,000 i:

.' i-

(BUREAU OF-MINES)—C.

tons)
To North and

i.I....i

EXPORTS

'r
*

general

(pet

•.-

Mar.

*y 4,411,000

Pennsylvania

———.—Mar.

5,501,000

undelivered

43.000

226,124,000'
,14,722,000:

; y

7,219

and

*280,438,000

COAL

30.050c

13.000c

17,000

278,820.000
.

13,238

13,015

10,070

12:302

29,732

27,474

'■-.-■J

^24,221.000#

31,679,000

-*15,615,000

TRUCKING ASSOCIATIONS, INC.
y
of December:';
freight transported by 322
carriers (in tons)
')y
5-;'; >:y >.
<.
' r
»•
•;>>>(•:",'•,

31.525c
y

-"16,000 *

—Month

10.500c

•

MOODY'S BOND YIELD DAILY AVERAGES:

1949

;

Mar.

Group

i.ijii.«.,i

order

; 24,888,000

16,581,000

delivered——

cars
cars

,......

27,071,000

•

-"'Month of Decembery:y
U.'S. exports
of

Mar.

—

■

•{

,!'

"export

(barrels)

-Mar.

at-

Public Utilities
Group—
Industrials Group ———

MOODY'S

Intercity

------

stocks

> «.-{•

AMERICAN

^1,867,000*

Mar.

11,793,000

(New York)

»■.»»■.,■'ini.

j,i

—Mar.

at.

Average corporate

Average

Mar.

MOODY'S BOND PRICES DAILY AVERAGES:
U. S. Government Bonds

Aaa

23,400

223,100 ' > '
r,'_
'yVj'-.tg}:

•

(end of month) *

;

99%) at

tin

all

"'j .New freight
Backlog ,of

.458,000

copper—

(delivered)

Railroad

16,500

(bafrels)lJll"2-^'iJi:i^2£Ldf>;.'t*
imports (barrelsr^yi-^i^^^fl^S--

QUOTATIONS):

(East St. Louis) at.
Aluminum (primary pig.

V" 9,060,000
v

7 "

gal- '".yv

AMERICAN RAILWAY CAR INSTITUTE—
Month of January:
Orders for new freight cars__—

...

gross

output

Increase

Zinc

Straits

461,000

~f':

>7,121.800

,/ 166,200

yb'krrelsyiL^Itl1—'i"*-*24,930,000

(barrels)

18,520,000

Export, refinery, at
Lead (New York).at
J Zinc

8,120,000

427,000

2.0,600;

' 239,600

•

7,368,300

I ,229,667,000
237,565,000 «-236,438,000".
(barrels)IvJiLl ;^204,721,000-" ::2i2.650;000 y
214,174,000'

output

Refined product imports
(barrels)
'Indicated consumption domestic4'and

INDUSTRIAL)

Domestic refinery at

Lead

6,790,000

y-y 571,000

ton)
Scrap steel (per gross ton)

Electrolytic

8,440,000

Mar.

(in 000 jtwh.)—

PRICES.(E.

Mar.

INSTITUTE:

(COMMERCIAL

gasoline

100

IRON AGE COMPOSITE PRICES:
Finished steel (per lb.)——

;METAL

111,388,000
28,813,000

INDEX—FEDERAL RESERVE

BRADSTREET, INC,

Pig iron (per

140,294,000

INSTITUTE—J^onth

:: *. * .yy-L yyjv;.
production (barrels of 42

Ions
each)
V—i'.
Domestic crude oil output:

Crude oil

$304,665,000

(U. S. BUREAU OF MINES):
Bituminous coal and lignite (tons)

Pennsylvania

y
:

PETROLEUM

Natural

-yyyy, 643,774

$365,141,000

COAL OUTPUT

DEPARTMENT

V"":

703,983*

•

6,617,700
6,435,000

7,755,800*

therms

< M

November:

Total domestic

Mar.

construction

State

sales

.87,584\

rv-'-y;Y ;
8,016,000

(M therms)

gas

sales

gas

AMERICAN

21,469,000

ENGINEERING

—

Private construction
Public

145,081.' y9V.

NEWS-RECORD:
Total

gas sales

Manufactured'

freight loaded (number of cars)
,—Mar.
freight received from connections (no. of cars)—Mar.

ENGINEERING

^"Natural

ASSOCIATION OF AMERICAN RAILROADS:
Revenue

133,759

183,414

...

•

2,506,000

12,543,000

pipe lines—

—

AMERICAN GAS ASSOCIATION—For
morith'of
'December:...,.-,.- -4 *};
S'/3"-V'
Total gas sales (M therms)
*

12,155,000

Revenue

135,024
172, ^05

-Feb. 28

Crude runs to

fuel

*1,423,000

gallons each)

Residual

(bbls.

average

17,460
.12,676

26,153

olume 187

Number 5724

The Commercial and Financial Chronicle

(1199)

ontinued

from

page

The

following rules of thumb may
helpful: When the yield on
good bonds approaches the yield
on
common
stock, the time is
right to cut back the percentage
of
equities and to increase the

(2) Since the economy of the
country is highly dynamic and in¬
flationary forces will continue to

percentage
procedure

certain that the demand for mort¬

Impact ol Economic Readjustment
On Tins! Investment Policies
■i

when

industry is operating at full
capacity, so that business activity
can hardly
get any better.
Such
a
period is usually accompanied
tight money, and the Reserve

\yejrfor expanded capital expend(2) The farm price support politures.' It may therefoa^e toe con- icy will continue to exert inflacluded that capital outlays In the'
tlonary-pjressures. Despite the reimmediate future and throughout cent
recommendations^pi Presi-,
1958

will continue to

decrease.

dent

Eisenhower,

The economy is in the midst of

doubtful

downward readjustment, as evi¬

vote any

denced

by the fact that unemploy¬

ment has increased.

amounted to 3.4

Of the civilian labor force.

highly
Congress will

whether

support prices.
(3) The Federal Government is
already operating this year with

Over¬

deficit

which

grow.

Soviet Union to subvert and

dbtainabie

not as easily

before.

Inventories

trol

being reduced, and exports in

are

1958

the

free

world

con¬

remain

sfyear ago. industrial productiv¬
ity is, however, continuing to rise;
and there is a good possibility that

there

reduction

taxes.

chance

un¬

sold

which

wages

take

may

rise.

place in 1958 despite the decline
in business activity. ,As a result
ot

118.7

(1947-49=100)
117.4

1T6.9
in

the

January,

(3.4%)

1957

1957.

considerably

larger,
since midyear the increase has

but

was

slowed

main;

question confronting
today is: How far will the
present readjustment go and how
long will it last? ' Any prediction
in

many

economic i situation

the

respects,

years.

the

past

two

issues

gives

purchasing
still witli
.

power

and

groups

fairly

good

ties will increase

The

rate

lowering

the

other

have

discount
au¬

brought the period of

credit restraint to

To be sure, inflation
can be avoided if as a nation we

the

Nov. 14, 1957, and the
taken since that

end; and the
capital markets have

and

money

has

been

free

remarkable

in¬

cates

that

although

of
equities will continue to fluctuate

that

noted

Federal

expend- place in estate portfolios, large or
increase,' small. In analyzing methods of
whereas they declined sharply in
protecting the corpus against de1954. Even though the President preciation through investment in
forecasts a balanced. budget for
equities, ••• the
following {points
the coming fiscal year, one may
should be borne in mind:
take it for granted that this will
(IKThe American economy is
not be the ca3e and that deficit fi¬
dynamic, especially because of re¬
nancing will prevail during the search which creates new values
1958 and 1959 fiscal years.
This and destroys old ones. This means
ituation, together with a number • that an industry rthat today may
be considered a growing one
of other strong forces operating in
may
the economy, leads to theeonclu^ not be in the same position next
n
that;by the end;ef the year- year or the following year. TechllAfriftlAol
cninvitifIrt
nVtrtnrfAn
(the exact timing is extremely nological and scientific changes
will
'iff fault) the readjustment will be
have to be vvatched more
over
and that after .a period of
carefully than ever before. *
elative stability the\economy will
(2) Competition is keen and is
esume
its
This in turn
upward
course
and becoming keener.
itures

will

continue

gain reach

that the merger movement,

bove

which

new high levels. The
analysis therefore indicates

not

are

nowv;

witnessing

the

of the

hich

are

when

strong

the

inflation
This

ainly

present

possibility
readjust-

will

renew

conclusion

them-

based

the following consider-

(1) There is
nd

a strong inflationbias among workers, farmers,
many legislators.
Wage de-

will continue to grbw,

nands
new

and

upswing in business activ-

tv will

strengthen these demands,

he escalator clause
nanv

contained in

contracts is in itself
nflationary.
The
recent
anwage

louncement of the new

f the
s

applied not only

automobile

proposals

workers

union

indication of what the trend

labor costs

present would be to

on the acquisition of
obligations which are

non-callable in the
order

for

future in

assure the current yield
long a period as possible.
the other hand, the long-

If,

near

term trend of interest rates is up,
then obligations with a
shorter
to

ma¬

important.

diversification

turities would

bond

to follow.
As long-term
interest rates decrease and as we
approach the

end

readjustment, the

the

present
shorter should

the

maturity of obligations be.
Long-term bonds bought during
the period of high
money rates,
unless they are
callable, should
be kept indefinitely.

present

terest rates has not

yet

in¬

run

its

The degree of the decline

and

duration

the

extent

the

will

depend

government

inter¬

and

work

rapidly

com¬

the

trust

company or the trust department
of a bank, but it also has its com¬

pensations. It clearly demonstrates
to laymen how difficult a task the
proper administration of an estate
is and how important it is to en¬
trust this task to competent trust

experts.
fact

Growing

awareness

this

is "bovind to lead to a
increase ~in the number
estates administered by trust

companies.
DIVIDEND NOTICES
NATIONAL SHARES CORPORATION
14

Wall

Street,

the

dollar

the

though indications

future.

Al¬

two

JOSEPH

Vice
March

10,

steep

as during
the need to

protect the

purchasing power of
an
estate still persists.
(2) In view of the constant
changes in the economy and its
dynamic character, a highly flex¬
policy is neces¬
regards equities. This in¬

sary as

careful

selection

not

March
NO.

1958

162

meeting of the Board of Directors of
Dome Mines Limited, held this day, a
quarterly
dividend

(17y2c)

Seventeen

payable on
of

holders
March

record

31.

and
One-half
Cents
Canadian Funds)
was

(In

Per

declared

April 30,
the

1958,

share¬

business

may

con-

be in the fu-

vention; the actions of the Federal
Reserve authorities;
and, above
all, on the trend of business. If,
because

national

security and
other
reasons,
there should be
massive intervention by the gov¬
ernment
and
the deficit
during
the present and the coming year
be substantially larger than is en¬
visaged in the President's Budget
Message, the decline in interest
rates will not go as far as in 1954
and

the

duration

low

money

rates may be shorter. Aside from
this consideration, which cannot

CLIFFORD

MICHEL.

President and Treasurer.

GENERAL REALTY A UTILITIES

CORPORATION
4l%

Cumulative Income Debentures
Due

NOTICE

September 30,

PAYMENT

196!)

COUPON

NO.

among

dustry,

(3)

should

is not advisable to rely
heavily
on
growth
stocks

too

which

are

based not

These

possibilities

not materialize.

(4)

Finally,

should

include

portion
such

portfolio

every
a

reasonable

defensive

pro¬

bank shares.

Aside from
lem

selection, the probprotecting an estate by

purchase of equities involves primarily the element of timing—obviously the most difficult problem
and

one

quate

for which

solution

has

far

GENERAL REALTY

UTILITIES

CORPORATION

SAMUEL M. FOX, Treasurer.
March 12,

1958

'•

groups

The Garlock

among

Packing Company
March 5. 1958

stocks and

whenever the Reserve

time, a reduction in the per¬
centage of equities and an in¬
in the

percentage of bonds

indicated.

COMMON DIVIDEND No. 327

meeting of the Board of Direc
held this day, a quarterly divi'
dend of 25tf per share was declared
At

tors,

the

common

stockholders of record

tent of the

down, the

the close of

business March 14,1958.
H. B. Pierce, Secretary

While the immediate trend

interest rates is

Com¬

stock of the

payable March 31, 1958, to

pany,

ex¬

decline and its dura¬

tion cannot be appraised with any

degree of accuracy. They will de¬
on the degree of interven¬

pend

been

with

business

condi¬

tion

the

thorities,

Federal

Reserve

au¬

magnitude of the
Federal
deficit, the methods
adopted to finance the deficit, and
the trend of business activity.
(5) The end of the readjustment
will

the

be followed
for

demand

which

will

credit

and

capital
decline in

bring the

interest rates to

increased

end.

After the

WAGNER BAKING
CORPORATION
The

are

(6) The secular trend of interest
is

can

much

Directors

has

the 7%

Preferred Stock

1958,

to stock¬

holders of record March 21,1958.

STEVENS,

Secretary

{yiti-Rotmtimnfai

unless the
the future

but
forces in

upward;

inflationary
are

dividend of $1.35 per

therefore again likely

decline.

rates

payable April

readjustment is over and the re¬
covery is well under way, bond

prices

Board

declared

pronounced than

envisaged at present, in¬

terest rates—short-term

well

A Diversified Closed-End

Investment

long-term—in the foreseeable fu¬

The Secular Trend of Interest

Company

First Quarter Dividends

Rates

While long-range predictions are
always" hazardous, the following

HONOR GRADUATE

conclusions

Major

could

reasonably

(1) Interest rates
to

decrease

are

the

not likely

level

which

prevailed from 1934 up to March,
1951, when the Treasury-Federal
Reserve
return

Accord
to

the

bonds,

government
should

found.

cannot

be
now

reached.

was

policy

major

pegging

unless

there

emergency,

envisaged.

30 cents
on

ate

Economics

School),

seeks

entry

brokerage

agement

position.

WORKER,

portfolio

GOOD

man¬

67Vi cents

HARD

Financial

Commercial

York

the

18, 1958

Kenneth H. Cha'mers

Secretary

Chronicle, 25 Park

Vpvy

Payable April 1, 1958

JUDG¬

Record Date March

N-227,

STOCK

$2.70 PREFERRED STOCK

MENT.
Box

the COMMON

Fi¬

(A. B. Degree, Gradu¬

nance

reached:

ade-

rise

tions toward the end of the year.

securities,

good public utilities and

minor

improvement

today selling at a price
on present
earnings but
possibilities in the dis¬

future.

tant
may
'

Payment of the amount called for bv Coupon
No. 27 representing interest for the s x months
period ending March 31,
1958 on the above
mentioned
Debentures
of
Genera]
Realty
&
Utilities Corporation,
will be paid on
March
31, 1958 at Bankers Trust Company. Successor
Trustee, 16 Wall Street, New York J 5. N. Y.

1958.

only

(3) Whenever bond yields ap¬
proach or surpass the yield on

Secretary

of industries but
individual securities;
and, above all, it involves careful
timing.
among

also

STOUT,

and

DOME MINES LIMITED

investment

ible

President

1958.

are

years,

York

dividend of twelve cents £l2c> per share
has been declared this day on the
capital stock
of the Corporation payable
April 15,
1958 to
stockholders of record at the close of business
March 31,
1958.

that, bar¬
ring unforeseen developments, the
increase in prices in the near fu¬
past

New

nate the danger of further depre¬
ciation of the purchasing power

course.

its

plicates

ment, and the recent leveling out
of the price indices do not elimi¬

(4)

downtrend

readjust¬

obviously

economy

DIVIDEND

Conclusions

/Interest Rates

The

changing

ma¬

to be the best

seem

policy

crease

The Short-Run Outlook for

the

correct,

the

and,

ing maturities.
(7)
A
dynamic

maturity should be acquired and
more

maturities

ment reaches its end, of shorten¬

go higher than those which pre¬
vailed during the summer of 1957.
If the above analysis is

diversification of bonds

turity becomes

1957.

sirability of following a policy of
diversification
as
regards
bond

constant

authorities pursue a policy of ac¬
tive credit restraint for any length

indus- as yet be fully appraised, low
try groups but also among indi- money rates should prevail during
viduaT corporations within an in- 'the greater part of 1958; and there

rather

tions:

pro-

cerns

ty again turns upward, the forces
lves.

with lees aggressive managements.-Thus,.selectivity should

ent is ended and business activ-

even

position of well established

free

Inflationary. Forces
There

become

pronounced,

in the early '30's, but
periodic readjustments

onomy.

hat

characteristic of

occurred

will

already

nounced in the future. This will
give rise to new giant corporations which may have an important impact on the competitive

beginning of a sharp
ecline in business activity, such

long-term
.

the peak
the summer of
This would indicate the de¬
surpass

—

means

hat what

concentrate

deed., j International, competition

materially and periods of declinis keen and in all probability it: :ing business activity will put a
will increase.
* "
K' V squeeze on profits of corporations,
As against these factors, it must
common
stocks have a definite

prices

not

during

rates in the discernible future will

volves

the

doubt¬
however, whether long-term

ful,

economic \comeback

(1) The decline in business ac¬
tivity, the increase in unemploy¬

measures

time

substantial,^

the

by the Federal Reserve

thorities

us.

world

the need for

(3) The long-terth trend, of in¬

the

1960's

terest rates is upward. It is

ture will not be

early

be greater than ever before.
Capital expenditures by corpora¬
tions are bound to be great, and
the supply of
tax-exempt securi¬

so..
accordingly.
Prices
of
However,- reacted
long as there is no evidence bonds have risen materially, and
1953;i .The pent-up demand
for-That .this will is widespread, we the end is not yet in sight. This
ho rsing and
for durable > goods must work on the assumption that situation raises the questions: (1)
which existed in 1948 and to7a
inflation, even though perhaps in How long will the downtrend in
lesser, extent in 1953 lias largely a milder
rates I last? (2) What is
form, will continued;
> ^interest
the long-term or secular trend of
disappeared. £ Private
indebtedJ'V
V•'"a
ness has increased materially durinterest rates?
If the long-term
K"
Investment Policy
ing the past few years, and the
The above analysis clearly indi- trend is down, then the best policy

today

1948

is fairly

the

will

than

purposes

strong.

have the will to do

serious

all

will

reached

industries,

The Trend of Interest Rates

;

results

run. ;

the

estate

long

Yet

still exists, and hence
probleni of bow to protect

hazardous,

during

rapid

dollar

the danger of further depreciation
in the purchasing power of the

up.

The

the future will not be

Moreover,
policy, obviously, is pos¬

averaging, particularly when care¬
ful thought is given to individual

possible that the increase
in prices of goods and services in

1957

ac¬

bility is not possible, dollar aver¬
aging is a satisfactory way out.
Experience has shown that dollar

course,

The rise

index

consumer

mentioned, par¬
ticularly the steady rise in the
cost of services, it is reasonable
to conclude that the inflationary
pressures will continue.
It is, of

compared
and

June,

bonds

is not hamstrung by instruc¬
tions of co-trustees. Where flexi¬

In view of these and other fac¬

developments, wholesale
prices have tended to level out. In
mid-January the index stood at

for

mon^y

gage

and

tors that could be

these

with

;

future

bound

gen¬

only where the trust com¬
has considerable flexibility

pany

add to the cost

business, will continue to

money

end.

only

the

sible

Similarly, state and local

in the immediate future it will in- ; taxes, which also
crease
more " than " the
rise
in
of doing

such

income

corporate

are

peak nor
quired at the bottom.

material

boom to

any

guides, they should, if im¬
plemented by a study of other
indices, prove on the whole satis¬
factory.
It is evident, however,
that equities will not always be

changed, defense expenditures are
bound
to
grow.
Consequently,

bound to be smaller than

are

So long

bring

While these rules

probably
the aims of the

peared, and jobs

are

will

eral

will

time payment has virtually disap¬

the

aiithorltJ#llow a policy: of public works grows.
However, the
active credit restraint, which if
savings of the nation, particu¬
followed
long
and
persistently.- larly contractual savings, will also

appreciable reduction in

farm

In December

million,

of bonds.
The same
should
be
followed

exist, the demand for capital in

ture

Broadway, New York 6, N. Y.

The Commercial

fjid Financial Chronicle

Thursday, March 13, 1958

(1200)

turn

BUSINESS BUZZ

helps create more jobs so

that

our

economy

can

continue

expand."
His
committee
has
asked
businessmen to put money into
.

•

the program and to offer dis¬
play space for special publicity

Behind-the-Scene Interpretation*

VVlIf

jljL w I'll'

Capital

from the Nation's

matter.

media,/advertisings firms,
amh 'jcivk:
organizations .are- joihihg with

WASHINGTON. D. C.—-Com-

targets of the IFC
oneration are firms engaged in
manufacturing, processing and-

International Finance Cor¬

poration.

Wprld Bank. IFC is
an investing
institute -dealing
directly with private business.
It was* set up in July, 1956, to
promote economic development
iary, of the

major productive ventures.

this multina-

Since that time,

tion

painstakingly

has

agency

undertaken

Now it has

that

others

its financing

meet

the

Before

eluding

considered.

• •

the

enterprises that
ments

are

will

are

operated.

attract

IFC Presi¬

dollars and half in

dent, stresses the importance of
bringing nongovernment capital
into the program. He says: "
conclude

that

for

solid

conditions

where

people have

The

convinced

conditions

that

most

can

per

;

selves, IFC uses its subscribed
funds,, in limited amounts," for

;

sell

successful,

1
>

clearing house,. bringing to- ' ]
gether (1) the opportunities for "t
sound

placement of funds, (2)
foreign and domestic private
capital,
and
(3)
experienced
management.

has

been

division
tracted

than

for
-

public
at

officials
time.

this

men

the

cover

size

neither

enterprises that

vast

nor:tiny.

IFC

j
!
,

Thus far, the agency is taking

part in investment activities in
countries
ural

with

substantial

resources.-

first

six

and

two

others

projects
are

are

Two
are

nat-

The

class,

npt

their

the

resident

sturdy

prop

been

on.
a

interest

the

source

concern

6 Ya

ner

for.

out

observed

of Canada annual convention at

Manoir Richelieu, Murray

months

1957,

Barnum

of the National

Bank

of Wash-,

71'

...

June
/

Merrill

vice chairman.

planned

observance

"'r
v

and

June

was

getting

this

special week is to add to
awareness

of the essen-/

tiality

requests to appraise more than
20,000 dwellings per month, But
reques.'/s, declined

December and 7,304

5,307

savings

"Invest

invest-

and

note, Mr. Colton

V-f' Y

Y "V

says:

in 7

in January,

'ments. On that

America

people?

Week

understand

The recent boost in maximum

helps

permissible discounts is appli¬

clearly the function of the

cable

the

entire

country.

Actual discounts will vary

with

our

the

Vet¬

erans

Administration.. Even be¬

fore

the

upsurge

action by the Senate,

have-not
-

in maximum discounts that may

Y: ■'*'

^investment of capital in increas¬
ing our productivity, which in-

Investment- Association

of New

York

outing at Sleepy Hollow
i Country Club, Scarborough on
the Hudson, Scarborough, N. Y.
-

•! public

1958?(New York City)

June 27,

,..

Bear. Yacht Club,;;White Bear
Lake, Minn;,;\

Pierce; Femier & Smith, is serv-7

ing

(Minneapoiis-St.

City Bond Club annual
picnic and outing at the White

Lynch,
.

•

1958

19,

Paul)
Twin

-Johnso n,

Bay«

Quebec.

C'olton

supervising participation in the
Washington area.
Richard
L.

;':

Country Club of Maryland.

June 9-12, 1958 (Canada)
Investment Dealers' Association

economic life.

these instances,

..'T.

national

The

July,.-

April

This

ington is chairman of the group

}>:

the

from

(Baltimore, IVId.)

Baltimore Security Traders As¬
sociation annual spring outing

role of savings and investments

President

discount controls" became effec¬

: In

May

con¬

have arranged
financing before

loan

May 16, 1958

program is to be marked by
additional emphasis on the vital

are

(St. Louis, Mo.)
St. Louis
Municipal
Dealers
Group annual Spring Party.

savings and loan firms in

through

Spring Din¬

at the Waldorf-Astoria.-

May 1 & 2, 1958
Week"

Capital are to play a large
part in Invest in America Week,
to

Security Traders Association of
New York Annual

•

cent.

Sept. 29-Oct. 3, 1958
Springs, Colo.)
:

(Colorado
}

National Security Traders Amociation

Annual

Convention

the Broadmoor

TRADING MARKETS
American Cement
A.

Botany Mills
S. Campbell Co. Com.
Fashion Park

Indian Head Mills
United States

Envelope

Morgan Engineering

Carl Marks & Co. Inc.

National Co.

Flagg Utica

con¬

in housing
VA moved
to promote more home lending.
It did so by allowing
an
in¬
crease-of one percentage point

;

are

business-

limit

has

siderable,

Aus¬

tralia. While these countries

decidedly

rate

in Brazil
and

home-building ;

drooping economy, these

hold.

This

the

Mexico.1

Chile

can

trigger the building of 200,000
to 400,000 units Within a year.
In
addition, the bill was to
provide the means for break¬
ing through the
per cent
ceiling on veterans loans.

putting an average of less than
$2 million into each project. }

loans

approximately

the

April 25, 1958 (New York, N. Y.)

ex¬

newly sent to the Senate floor.
Proponents of this compromise
measure,
prescribing
a
prograin oL $1.8 billion, say it will

Steering of

Occupying the spotlight is the
bill on housing

are

Washington

emergency

agency's entry into the field of

foreign financing. Interested
chiefly in investments of medi-

the

into

for the

is sufficient to

Association annual meeting
Shamrock HiFon Hotel,

ers

In western states,

low-equity

•

but it

would

the

land

Housing blatters are much on ;
the minds of the lawmakers and

nations

member

Investment companies, banks,
and

the builder may

;

IFC. This total is $7 million
short of the authorized capital,

residences

.VA Experience

market

subscribed

York

England

■

market,
of the. sub¬

home-buying

except where some

■

$93 Million of Capital

Capital amounting to $93 mil-

second

and

have been forced

the

buy, the IFC interest.
-

financing

Legislation

per

To complete

expedients

tive.-

funds

lion

veterans.

private capital, with the prin- ]
cipals. getting first refusal rights

Housing

New/

cent.

Others

of.
spring confer¬

Edward Hotel.

W/2 per cent for loans
down payment of 16 per

or more.

cent, the drop in single
housing was 10

rate

sale contracts.

Its intention is
as a project is
enough
to
attract

Association

April 23-25, 1958 (Houston, Tex.)
and ;
; Texas Group Investment Bank¬

discount that could be

the

multi-unit

mortgage

soon

cent

;

would

such

profitable.

are

rTo achieve the goal of helping
have-not nations to help them¬

New

with

their home buying, large num¬
bers of veterans have resorted

IFC does not plan to keep its
investments simply because they

peoples."

southern

pected

to many

bearing

shares equivalent

per

interest

discounts

be about

of discount con¬
trols last year left only conven¬
tional
financing with interest
rates of around 6 per cent, open

Siemens,

gets

annual

at the Drake.

tion annual dinner at the King

Imposition

to
complete conversion of its notes.

other

investments. It may act,' also; as

IFC

it,. allowable

sees

"Invest-in-America

amounts.

option

aspect of freedom, its meaning
and its results, can be made
evident

notes

annual

given play in this country. This

and

511
and

6%. It will mature
in 15 years, with amortization
] beginning at the end of the 11th
year, to retire the issue in equal

created through development of

tangible

million,

private business — the sort of
dynamic force to which we have

interest

these

likely

investment

accumulated in 1957. :

VA-guaranteed hous¬
from the 1956 total.
housing,

the VA

FHA-insured

with

investment.

opportunities for the future. V.<
am

But

property and

the amount of down payment.

50 per cent

cent

receives an option
equal to half its total

are

ing units dropped by more than

third

the

was

Starts in

IFC

year.

decent eco¬
nomic stake in the present and
"I

begins

amounts

and

loans

semi-annual :

thirteen

zation

munism to be built up in the
developing countries, we must
look most hopefully to creating

loans

where

paid

Ample evidence that lenders >
are staying clear of 4% Per cent ;

Amorti¬

earnings.

amount

Bankers

America

the location of the

payments related to the

terest

ment

„

Toronto Bond Traders Associa-

Both

per

•

Y7""" April 11, 1958
(Toronto, Canada)
be

stock¬

pesos.

Party?"

ence

interest rate, plus contingent in¬

and enduring resistance to com¬

have

portions

for that paragraph about
the stock room at the- office

out

19-20, 1958

(Chicago, III.)
Central States Group of Invest-

responsible

happened

Christmas

$520,000, half in U. S.

alent

WHO

"Just
what

concerned.

holders, IFC invested the equiv-

try Club., )

March

has-both

Mexican

and

Canadian

(St. Paul, Minn.)

Club meeting at Town & Coun,

cases:

which

Bristol,

Garner's Views
Robert L. Garner,

19, 1958

Twin City Investment Women's

the Bristol de

and .Siemens

Mexico

the latest one has done.

negotiates the rate for each

is illustrated by

that

investors—

private

the Waldorf-Astoria.
March

■J

project individually. Rights to >.
participate in profits also are
considered
separately.
Loan :
maturities range from five to :
fifteen years.
:7 :
This flexible financing policy '

same

sort

all

for

rates

interest

government
Its invest¬

the

time, it will not put money into
owned

Field

Investment

New York Security Dealers Association 32nd annual dinner at

uniform
projects,

using

than

Rather

By its own definition, IFC is 7
not intended to compete with

capital.

March 7, 1958 (New York City)

The Australian company,

Negotiates Interest Rate

;

private

/■;/ IFC

;

in India, are being

some

and

asked

EVENTS

troducing timber impregnation
into the country.
'
7..,

posals for perhaps 60 more in¬
vestment projects. At least half
are
in Latin America. Oppor¬
tunities much farther afield, in-

been

may or may not coincide with
the "Chronicle's" own
views.]

Holdings Ltd., is in
the lumber business and is in¬

pro¬

are

agency

churches,

have

and

Duncan's

requirements will follow.

schools,

COMING

heavy electrical equip¬

ducer of

ment.

Local chambers
industrial com¬

pretation from the nation's Capital
;
'

plant can overhaul- about '/
engines per year. In Brazil,
IFC
invested in
Siemens do
Brasil, a German-owned pro¬

sixth venture, and

organization followed this

cooperate.

480

proposals. IFC entered into only
five transactions in its first one
and one-half years.

commerce,

Its

investment

examined dozens of

the public.

banking

the program

{This column is intended to re+,
fleet the "behind the scene" inter-

principle in selecting its initial
projects. One of the Mexican
companies,
for
example,
is
Bristol de Mexico, which over¬
hauls and tests aircraft engines.

for

capital

needing

areas

and

present

service clubs

related activities.

The

panies,

b&h«ves.

provide the best economic po¬
tential
through
employment,
training, and the bolstering of

subsid¬

An affiliate, but not a

IFC

These,

mining-.

ihvestment

houses

Primary

will do well to keep an eye on

the

financing.

dollar

panics on the lookout for in¬
vestment opportunities abroad

-the

>■-»

i. 8.

get

happy

are

men

■

information

Public

«*■

FOREIGN
•;

SECURITIES SPECIALISTS

20 BROAD STREET

TEL: HANOVER 2-0050

•

NEW YORK 5, N. Y.
TELETYPE NY 1-371

LERNER ft CO.
Investment

10 Post Office

Securities

Square, Boston 9, Mass.
Teletype

Telephone
HUbbard2-1990\

-BS 69

Volume

187

Number 5724

The Commercial and Financial Chronicle

PICTORIAL

INVESTMENT TRADERS ASSOCIATION
OF PHILADELPHIA
ANNUAL MID-WINTER

At Bellevue Stratford Hotel

DINNER

FEBRUARY 28,

1958

President

First

Second

V ice-President

Treasurer

Secretary

•

v,'

James G«

•

Mundy

Suplee, Yeatman,
Mosley Co.,
Incorporated
Rubin

James B. McFarland
Stroud &

The

Company,

First

Willard F. Rice

John Edward Knob
t>,"

Hardy

Drexel

Co.

Eastman

Boston

Dillon,

Securities

Union
&

Co.

Corporation

Incorporated

r
BOARD

GOVERNORS

L. Craig

Herbert E. Beattie
H. A. Riecke &

Co.,

Inc.

Spencer L. Corson

Jack Christian

Edgar A. Christian

Elhins,

Janney, Dulles &

Suplee, Yeatman,
Mosley Co.,

Stokes

Battles, Inc.

Joseph J. Cummings

Morris,
&

Brooke

Lewis

Dick, Jr.
Dick

Co.

Incorporated

Robert F. Donovan
Blyth

William R.
New

Co., Inc.

Radetzky

York Hanseatic

Corporation

Merrill

M. Freeman &

Hemphill,

Noyes

Co.

Lynch,

Samuel M.

Thomas J. Love

Kennedy

Geo. E.

Yarnall, Biddle & Co

Thayer, Baker & Co.

Snyder & Co.
Co.

Pierce. Fenner

Co., Inc.

Wallace H. Runyan

John M.Hudson

Harry F. Green, Jr.

A. H. Fenstermacher

Rudolph Sander
Butcher

Sherrerd

Smith

Joseph E. Smith
Newburger

Co.

Chas. L.
Janney,

Wallingford
Dulles

Battles, Inc.

John F. Weller
Goldman,

Sachs

Co.

E. Coit Williamson
&

Poole,

Schmidt,
Roberts

Parke

The Commercial and Financial Chronicle

2 PICTORIAL

Mosley, Suplee, Yeatman, Mosley Co., Incorporated, Philadelphia; Philip A. Loomis, Jr.,
A Exchange Commission; Jim Mundy, Suplee,
Yeatman, Mosley Co., Inc% Philadelphia;
Joseph Smith, Newburger A Co., Philadelphia; Charles Bodie, Stein Bros. A Boyce, Baltimore

Victor

John

Securities

Fenstermacher, M. M. Freeman A Co., Inc., Philadelphia; Charles Brennan, Blyth A Co., Inc.,
Philadelphia; Rick Sander, Butcher A Sherrerd, Philadelphia; Bob Orr, Hopper, Soliday A Co.,
Philadelphia; Cel. Herb Blizzard

Butler, First Boston
New York;
William

Thursday, March 13, II

Corporation, New York; Arnold J. Wechsler, Ogden, W^ch-.ler A
D. O'Connor, Shelby Cullom Davis A Co., New York; AI Tisch,
Fitzgerald A Company, New York

Ed Knob, Drexel A Co., Philadelphia; Vic Mosley,
Philadelphia; Joseph Newman, Philadelphia Evening
Bishop

Hedberg,

Co.,

Suplee, Yeatman, Mosley Co., Incorporated,
Bulletin, Philadelphia; Robert D. Hedberg,
Philadelphia

Greetings and Best Wishes from Philadelphia
TRADING DEPARTMENT PERSONNEL

Frank J. Laird

Equipment Trust Certificates

Allen B.

Railroad Bonds, Guaranteed

Foard, Jr.

Leased Lines Stocks

and

James

Public Utility

McFarland

Industrial

Raymond A.

Morris, Jr.

Bonds 8t Stocks

Bank Stocks

Robert N. Greene

Sales Order

Department

Russell M. Ergood, Jr.
vice

president

Michael J. Rudolph
Alexander B.

Municipal Department

Brock

J. Richard Hoffman

L. Wister Randolph
Institutional Department

Robert J. Campbell

Franklin

M. Seeley

Edward F. Hirsch

Statistical Department

vice president
/

Felix E. Maguire

Field

Representative

Bill

STROUD & COMPANY
INCORPORATED

123 South Broad Street

PHILADELPHIA 9
new york

pittsburgh

allentown

lancaster

atlantic city

Burke, May A Gannon, Inc., Boston; Harold Scattergood, Boenning A
Philadelphia; Ed Caughlin, Edward J. Caughlin A Co., Philadelphia;
Harold J. Williams, Boenning A Co., Philadelphia

Co.,

Volume

187

Number 5724

PICTORIAL 3

The Commercial and Financial Chronicle

E. W. CLARK & CO.
ESTABLISHED

1837

•

MEMBERS

PHILADELPHIA-BALTIMORE
NEW

AMERICAN

EXCHANGE

STOCK

EXCHANGE

STOCK

YORK

(ASSOC.)

EXCHANGE

STOCK

•

LOCUST AT

16th

STREET

PHILADELPHIA

Telephones:

Philadelphia KIngsley 5-4000
New York

Germantown

3-4000

WHitehall

Lancaster

York

John Flynn, E. W. Clark A Co.,

Bodie,

Stein Bros, A

Boyce,

Philadelphia; Joseph Smith, Newburger A Co., Philadelphia; Charles
Baltimore; Bob Diehl, Paine, Webber, Jackson A Curtis, Los Angeles

Drexel & Co.
Established 1838
'
.

'!* 's'

We Maintain Markets in

The First

•

•,

the Following

Stocks:

Pennsylvania Banking & Trust Co.

Girard Trust Corn

Exchange Bank

Philadelphia National Bank
Provident Tradesmens Bank & Trust Co.

Philadelphia Suburban Water Co.
The Hanover Shoe, Inc.

Members
New York Stock
Carl

Walston,
Joe

American Stock

Waist on A Co., Inc., New York; John Cantwell, Walston A Co., Inc., Philadelphia;
Walston A Co., Inc., New York; Andy Riggio, Walston A Co., Inc., New York

Exchange

Exchange (Assoc.)

Alberti,

Philadelphia-Baltimore Stock Exchange
Philadelphia 1

;

■

New York 5
30 Wall St.

1500 Walnut St.

Investment Bonds and Stocks

Newt

Parkes,

Gerstley, Sunstein A Co., Philadelphia; Herb Beattie, H. A. Riecke A Co.,
Bob Lienhard, Troster, Singer A Co., New York City; Walter Filkins,
Troster, Singer A Co., New York City

Inc.,

Philadelphia;

Securities of the United States Government
and its Instrumentalities

State, Municipal, Revenue and Housing Securities

Bonds, Preferred and Common Stocks of Industrial,
Public Utility and Railroad Corporations
At

.<''

Bank Stocks

Casualty, Fire and Life Insurance Company Stocks
Bankers' Acceptances

Securities of the International Bank for

Reconstruction and Development
A

Canadian Bonds

«t*. « y

New York
Philadelphia

Shipman, H. Kook A Co., Inc., New York; Bill McCullen, Hendricks A Eastwood, Inc.,
Sherman A
A Co., NewNew York;
YorF
phia; Edwin A. Abele, L. D. Sherman
Albert J. Caplan,
Albert J. Caplan A Co* Philadelphia

Philadel-

Underwriter

Dick

Foreign Dollar Bonds

•

fe'Jf>•

Distributor

•

Boston

Pittsburgh

Cleveland

•

Dealer
Chicago

San Francisco

i
i
*

■

The Commercial and Financial Chronicle

4 PICTORIAL

...

Thursday, March 13, 1958

& Co., Inc.

Public Utilities

Primary Markets
With

Industrials

Complete

Bank and Insurance

Trading Facilities

Municipals

Jim
&

McGivney, Hornblower A Weeks, New York City; Willard Rice, Eastman Dillon, Union

Co., Philadelphia; Jack

Philadelphia;
Bonds

NEW YORK

BOSTON
DETROIT

SAN FRANCISCO

•

PHILADELPHIA

•

PASADENA

Preferred Stocks

•

MINNEAPOLIS
•

CHICAGO

•

PITTSBURGH

Butcher

•

OAKLAND

•

SAN JOSE

•

LOS ANGELES

•

SEATTLE

LOUISVILLE
EUREKA

•

FRESNO

•

Hecker

A Co., Philadelphia;
Hornblower A Weeks, Philadelphia

Robert

Holdsworth,

•

PORTLAND

•

INDIANAPOLIS

•

SACRAMENTO

PALO ALTO

OXNARD

•

Sherrerd

ESTABLISHED

1910

Bob

CORPORATE

Milburn,

Common Stocks

CLEVELAND

•

SPOKANE

•

SAN DIEGO

•

Securities

Murphy, Hornblower A Weeks, Philadelphia; Bob McCook, Hecker A Co.,

John

TRADING

James J. McAtee,

DEPARTMENT

King, Charles King A Co., New York; Lloyd Brown, Arthur L. Wright A Co., Inc., Philadelphia;
Henry Warner, Arthur L. Wright A Co., Inc., Philadelphia; Hal Murphy, Conimercicd
& Financial Chronicle, New York City

Manager

Rudolph C. Sander

Walter E. Gemenden

Alvin W.

MUNICIPAL

Jordan, Jr.

TRADING

James W. Heward,
John B. Richter

DEPARTMENT

Manager

Henry P. Glendinning, Jr.

Joseph E. Labrum

Wm. D. Sherrerd, III
MEMBERS

New York Stock

Exchange

American

Philadelphia-Baltimore Stock Exchange

Stock

Exchange (Associate)

1500 WALNUT STREET

•

PHILADELPHIA 2, PA.

Philadelphia Telephone

Teletype

PEnnypacker 5-2700

PH-4

New

York

Telephone

BArclay 7-4041

Louis Zwahl, Mabon A Co., New York City; Robert Diehl, Paine, Webber, Jackson A Curtis, Los
Angeles; Felix Maguire, Stroud A Company, Incorporated, Philadelphia; Leo Dube, Cooley & Company,
Hartford, Conn.; Ed Markham, Wertheim A Co., New York

special department is maintained for

large clien¬

tele of Brokers and Security Dealers. We specialize in

settling and handling all
locally

and

types

nationwide.

of securities transactions

Redeliveries

handled by

messenger

network

Correspondent Banks. The

erate.

promptly

are

collections through

our

h mod¬

cost

Inquiries invited.

The First
BANKING

Pennsylvania

AND

TRUST COMPANY

BANKING

SINCE 1782

31 OFFICES—SERVING MORE PEOPLE MORE WAYS THAN ANY OTHER PHILADELPHIA BANK

Member federal Depodi two*. Corpoieno.

Hirsch, Stroud A

Company, Incorporated,
New York; Nat

Philadelphia; William Candee, Candee, Moser A
Krumholz, Siegel A Con New York

Co.,

Volume 187

Number 5724

The Commercial and

financial Chronicle

PICTORIAL 5

LIFE INSURANCE—FROM

SHAREHOLDER'S

The

Life

Insurance

business

THE

VIEWPOINT

reputed to be the least

specu¬

lative of all industries yet holds the
greatest promise

for capital

growth.

pen',

Its product is created by the stroke of

...

plant, machinery,

problems.

And it has

materials; knows

raw

labor

needs

inventory

substitute.

At the close of 1956, life insurance in force totalled
$415 bil¬
lion

covering 115 million lives.

record

$65 billion of

should reach
Larry

Warren,
E.

Coit

Reynolds A Co., Philadelphia; Albert Teller, Albert Teller
Williamson, Schmidt, Poole, Roberts A Parke, Philadelphia;
Newburger A Co., Philadelphia

could total

Co., Philadelphia;
Stan Jeffreys,

Last

the companies sold

year

insurance.

new

By 1975,

poptdation

our

estimated 220 million people and life insurance

trillion dollars.

one

To the investor, these

are

indeed significant figures. But most

significant of all is the fact that the additional capital required
finance this astounding

past,

growth will be furnished,

almost entirely by retained earnings

holder

will

receive

periodically in

the

in the

which the share¬

form

taxrprotected

stock dividends.
We have reviewed American National Insurance
sixth
ance

out

largest stock life
in force.

A copy

concern

with

over

Company,

billion

of the brochure will be gladly

insur¬

with¬

sent

obligation.

Boenning
ESTABLISHED

Co.

&
1914

Members of Philadelphia-Baltimore Stock
Members of American Stock

Exchange
Exchange

1529

Walnut St.,

Philadelphia 2, Penna.

Philadelphia

LO 8-0900

•

New York

Belford R. Thompson, Girard Trust Corn Exchange Bank, Philadelphia; Jack I.
Foard, Girard Trust
Corn Exchange Bank, Philadelphia; Ed Boyle, Girard Trust Corn
Exchange Bank, Philadelphia; Russ
Schuler, First Boston Corporation, Philadelphia; Paul Voigt, First Boston Corporation, Philadelphia;
Walter Fixter, J. W. Sparks A Co.,
Philadelphia

Members New York Stock Exchange and other
principal stock and

NEW YORK

•

Allentown

Hart, Euler A Hart, Philadelphia; Bob Hart, Euler A Hart, Philadelphia; Bob Topol, Greene
New York; Hugh Speyer, Baker, Weeks A Co., Philadelphia; Bernie Weissman,
Gold, Weissman Co., New York

LOS ANGELES

•

commodity exchanges

PHILADELPHIA

CHICAGO

•

Eureka

Oakland

Bakersfield

Fresno

Pasadena

Riverside

Stockton

Beverly Hills

Gary

Pasco

Sacramento

Tucson

Brooklyn

Ronnie

SAN FRANCISCO

Reno

Seattle

Hagerstown

Phoenix

Salinas

Tulsa

Camden

Harrisburg

Phoenixville

San Diego

Vallejo

Denver

Hartford

Pittsburgh

San Jose

Yakima

East Orange

Long Beach

Pomona

San Luis Obispo

Basle (Switzerland)

Erie

Medford

Portland, Ore.

San Mateo

Honolulu (Hawaii)

Eugene

Modesto

Pottsville

Santa Ana

Milan

(Italy)

and Company,

When itfs
•

PHILADELPHIA

•

THE

•

PENNSYLVANIA

•

Vic Mosley

DELAWARE

VALLEY

Call
•

Ed Christian

•

Jim

•

Harry Undy

Mundy

SUPLEE, YEATMAN, MOSLEY CO.
INCORPORATED

1500 Walnut Street
TELEPHONE:

KIngsley

NEW

Larry Colfer, Rufus Waples A Co., Philadelphia; Carl Necker, Schaffer, Necker A
Bud Schaufler, Schaffer, Necker A Co., Philadelphia;
Don Goodwin, Joseph D.
Philadelphia; Leo M. Dolphin, Dolphin A Co., Philadelphia

Co., Philadelphia;
Goodman

Co.,

YORK

•

5-1343
TELEPHONE

Philadelphia 2, Pa.
TELETYPE:
CAnal

6-7207

242

The Commercial and Financial
6

Chronicle

...

Thursday, March 13, 1958

PICTORIAL

Crouter & Bodine

DeHaven & Townsend,
Established

1874

•

Members

New

York

and

Philadelphia-Baltimore Stock Exchanges

Exchange

American Stock

PHILADELPHIA 2

LAND TITLE BUILDING,

Telephone LO 4-2900
Bell System

Teletype—PH 518

Distributors, Dealers, Underwriters

Corporate and Municipal Issues
Stock and Bond Brokers
Wilkes-Barre, Pa.

New York

30 BROAD

Deposit & Savings Bank Bldg.

STREET

YAlley 3-4131

Stamford, Conn.

Upper Darby, Pa.

ONE ATLANTIC STREET

6910 MARKET STREET

Fireside 8-6466

FL 2-0838

Inc.,

David Goldman, Charles A. Taggart
Corporation, New York; Charles A.

A Co., Inc., Philadelphia; Milton Capper, Capper

A Co., Jersey City, N. J.

in the Nation's

Effective Distribution

Third Largest

Charles A. Taggart A Co., Inc., Philadelphia;
Philadelphia; Ted Young, New York Hanseatic

Shulman,

Co.,

Taggart, Charles A. Taggart

BROKERS

DISTRIBUTORS

UNDERWRITERS

David
&

Dlgby 4-0200

Trading Area
T.

Newburger

Anderson,

Bioren A

Co., Philadelphia;

William H. Gregory 3rd, Gregory

A Sons, New York

Company

Members:
New York Stock Exchance

•

American Stock Exchance
'/p

-y-■/

f't

Philadelphia-Baltimore Stock Exchance

1401

Walnut

Street,

New York City

Philadelphia 2, Pa.

LOcust 8-1500

Atlantic City

Lebanon

Vineland

lliliill,
&
■,
1
1 ikii0 :X0

Frank

Call JANNEY,

Welch, R. S. Dickson A Co., Inc., New York; A1
Peabody A Co., Philadelphia

L. Hutchinson, Kidder,

DULLES & BATTLES for—
Bank and Insurance Stocks

act i w

s,-.

Industrials

New York

Telephone

Dlgby 4-9694
Bell

Teletype

■

<'/

Wire to A. M. Kidder & Co., New Yorh

JANNEV, DULLES & BATTLES, INC.
Members

System

New

York

Stock Exchange

Philadelphia-Baltimore Stock Exchange
American

LOcust

Common and Preferred Shares

PH 80

Philadelphia

Utilities

City-County-State-Authority Issues
Direct Trading

Pennsylvania Tax Free

trading
markets

Stock Exchange (Associate)

Telephone
8-3400

1401

Walnut Street,

Philadelphia 2

Since 1903—Underwriters, Distributors, Dealers, Brokers

Andy Pimley, First Boston Corporation, Philadelphia; Herb Gesell, Kugel, Stone A Co., New York;
Nick Hano, Newburger A
Co., Philadelphia; Bud Hardy, First Boston Corporation, Philadelphia;
Herb Tietjen, First Boston Corporation, New York

Volume 187

Number 5724

The Commercial and Financial Chronicle

PICTORIAL 7

Clearance Facilities

Local

Nation-wide

—

Special arrangements for special transactions
Available to
—

our

customers

—

service to and from New York

messenger

and other financial centers

—

convenient

efficient

financing arrangements

handling of settlements, deliveries

and collections

Your inquiries
Jack

Weller, Goldman, Sachs A

Co.,

Philadelphia;

Fred Underwood,

Boenning

Co.,

welcomed

Philadelphia

FIDELITY

PHILADELPHIA TRUST CODPANY
Since

Bankers

BROAD AND WALNUT

1866

STREETS, PHILADELPHIA S

ar.vw ut

Underwriters

Primary Markets
Bank and Insurance Stocks
Hank

Reg

Serlen, Josephthal A Co., New York; Willie Schmidt,
Knapp, G. C. Haas A Co., New York; George Harrison,

Laird,
Laird,

Dealers

Christiana Securities

Bissell A Meeds, New York;
Bissell A Meeds, Philadelphia

Distributors
-

Unlisted Securities

,;Yf

Corporates & Municipals

Laird, Bissell & Meeds
Members New York and American Stock

120

WILMINGTON,

Exchanges

BROADWAY, NEW YORK 5, N. Y.
Bell Teletype NY 1-1248-49

Telephone BArclay 7-3500

PHILADELPHIA, PA.

DEL.

NEW

HAVEN,

CONN.

DOVER,

SALEM, N. J.

ZURICH, SWITZERLAND

Joe

;

DEL.

McNamee, Hopper, Soliday A Co., Philadelphia; A1 Jordan, Butcher A Sherrerd, Philadelphia;
At Berkow, Newburger A Co., Philadelphia; Jim Traviss, S. J. Brooks A Company, Toronto;
Walt Gemenden, Butcher A Sherrerd, Philadelphia

Active TRADING MARKETS
in All

Pannsylvania Aitharity Issies

and General Obligation State, County and Municipal Bonds

Primary Markets
in

Pennsylvania Tax-Free
Preferred and Common Stocks

Kidder, Peabody
FOUNDED

Co.

1865

Members New York Stock Exchange, American Stock
Exchange,,
Boston Stock Exchange and Midwest Stock Exchange

Fidelity-Philadelphia Trust Bldg., Phila. 9, Pa.
Teletype; PH 249
Butcher A Sherrerd, Philadelphia; Coit Williamson, Schmidt, Poole, Roberts A Parke,
Philadelphia; Daisy Larson, National Association of Securities Dealers, Philadelphia, President^ of the
Investment Women's Club of Philadelphia; John Barton, F. P. Ristine A Co., Philadelphia;
Willard Rice, Eastman Dillon, Union Securities A Co., Philadelphia
jim

McAtee,

Altoona
Windsor 4-9405

Telephone; KIngsley 5-1600
Reading

Franklin 4-3153

Scranton
Wilkes-Barre
Diamond 3-1261 Valley 3-1166

The Commercial and Financial Chronicle

8 PICTORIAL

Thursday, March 13, 1958

;

yV'

DEALERS
■<

AND UNDERWRITERS
yyyy';y •""

Obligations of the

COMMONWEALTH OF

PENNSYLVANIA

and its Political Subdivisions
Specialists In.;.

ClTY

OF PHILADELPHIA BONDS

SCHOOL AUTHORITIES

PENNSYLVANIA

TURNPIKE, WATER ,AND SEWER ISSUES

SCHAFFER, NECKER & CO.

Floyd Justice, Kidder, Peabody A Co., Philadelphia; Frank Laird, Stroud A Company,
Philadelphia; Jack Holzbaur, Halsey, Stuart A Co., Inc.f Philadelphia; Nevin
Halsey, Stuart A Co., Inc., Philadelphia

Packard
LOcusf
from

Bldfl., Philadelphia 2
7-3646 ♦ Teletype PH 864

NEW

from

Incorporated,
Mann,

YORK-phone Enterprise 6286

PITTSBURGH—phone Zenith 0821

J. W. SPARKS 8c CO.
ESTABLISHED

1900

MEMBERS
NEW

YORK STOCK EXCHANGE

PHILA.-BALTIMORE

AMERICAN

STOCK

EXCHANGE

Brokers in

LISTED and UNLISTED SECURITIES

STATE, MUNICIPAL and REVENUE BONDS
DIRECT

WIRE

NEW

YORK

TELETYPE—PH

Western Savings

120

Broadway

2IO

New

York

Broad a Chestnut Sts.

WORTH

N. Y.

PHILADELPHIA

4-022O

KlNOSLEY

Fund

622,

Bldg.

George Fetters, Philadelphia Savings Fund Society, Philadelphia; Walter Webber, Halsey, Stuart
Co., Inc., Philadelphia; Dick Sugar, Halsey, Stuart A Co., Inc., Philadelphia; Bill Hilliard,
Philadelphia Savings Fund Society, Philadelphia

PA.

6-4040

Active Trading Markets In:
Eli

Lilly Class B

Quaker City Life Insurance Co.
Standard Pressed Steel Co.

Philadelphia Life Ins. Co.

Schmidt, Poole, Roberts & Parke
123 South Broad
Phones:

Street, Philadelphia 9, Penna.

N. Y. RE 2-1695, HA 2-4556}
Phila. Kl 5-0650

Fixter, J. W. Sparks A Co., Philadelphia;
Anthony Coculo, Fidelity-Philadelphia Trust
Company, Philadelphia; William Allen, Fidelity-Philadelphia Trust Company, Philadelphia; Thomas
L. Ralph, Fidelity-Philadelphia Trust Company, Philadelphia

Walter

u"' S

Dealers

Municipal Bonds

THE PHILADELPHIA NATIONAL BANK

Tom Riordan, Drake A Company, New York; Phil Gaughan, De Haven A Town send, Crouter A Bodine,
Philadelphia; Hank Crouter, De Haven A Townsend, Crouter A Bodine, Philadelphia; George Plumly,
De Haven A Townsend, Crouter A Bodine, Philadelphia

Volume 187

Number 5724

PICTORIAL 9

The Commercial and Financial Chronicle

CANADIAN STOCKS
NEW YORK

WALKER 5-1941-2

Boston,

Chicago,

Buffalo,

Cincinnati,

Philadelphia

Milwaukee,

Cleveland,

and

Detrqit;

Louis

St.

ENTERPRISE 6772

PITTSBURGH

ZENITH 0210

JAMES A. TRAVISS

Bernie

Eberwein,
New

MGR. U. S. DEPT.

—

S. J. Brooks & Company

Alex. Brown A Sons, Baltimore; Joe Scheidecker, Coffin A Burr, Incorporated,
City; John Fitzgerald, W. C. Pitfield A Co., New York; Tom Yeager,
Baker, Watts A Co., Baltimore

York

Members
The Toronto Stock

Exchange

185 BAY STREET

TORONTO 1

EST.

MAINTAINED

MARKETS
t

1916

...

' 1

Dealers in over-the-counter securities

TRADING DEPARTMENT

John D. Wallingford

Robert McCook

CO.

HECKER &
7

Members

Jim

Mundy, Suplee, Yeatman, Mosley Co., Inc., Philadelphia; Phillip Loomis, Securities A Exchange
Commission, Washington, D. C.; Ed Christian, Suplee, Yeatman, Mosley Co., Inc., Philadelphia;
Jules Bean, Singer, Bean A Mackie, New York

New

York

American

Stock

Stock Exchange

(Associate)

Exchange

Philadelphia-Baltimore Stock Exchange

Liberty Trust Bldg., Broad and Arch Sts., Philadelphia 7, Pa.
N. Y. 'Phone DIgby 4-6792

Teletype PH 767

Phila. 'Phone LOcust 4-3500

Blair

Co.

INCORPORATED

Business continuous since 1890

York Stock Exchange

Members New

Underwriters and Distributors of
and Railroad Securities

Municipal, Utility, Industrial

Equipment Trust Certificates

Bank and Insurance Stock
3 Penn Center

LOcust

Telephone

New York

Wire

System

Rochester

Connecting

Chicago

Philadelphia

Boston

Buffalo

Albany

Suplee, Suplee, Yeatman, Mosley Co., Inc., Philadelphia; Eddie Evans, Philadelphia National
Bank, Philadelphia; Reg. Knapp, G. C. Haas A Co:, New York

Teletype PH 269

8-2150

Private

William

Department

Plaza, Philadelphia

Flint

Detroit

Wilmington

Scranton

Grand Rapids
Williamsport

„

SAMUEL K. PHILLIPS 6- CO.
1904

Members

—

Our Fifty Fourth

Year— 1958

Philadelphia-Baltimore Stock Exchange

LISTED AND UNLISTED SECURITIES
,

1500

Incorporated, Philadelphia; Harry Heffelfinger. Samuel K. Phillips
Rodgers, Blair A Co., Incorporated, Philadelphia; Fred Carter,
A Townsend, Crouter A Bodine, Philadelphia

George E. Nixdorf, Blair A Co.,
.

Co.,

Philadelphia;
De

Les

Haven

Chestnut Street, Philadelphia 2, Pa.

Philadelphia

Bell System Teletype

New York

LOcust 4-2600

PH 375

COrtlandt 7-6814
^

■

•

The Commercial and Financial Chronicle

PICTORIAL

Felix Maguire, Stroud

A Company, Incorporated, Philadelphia; John F. McLaughlin, McLaughlin, Cryan A Co., New York; James B. McFarland, Stroud
A Company, Incorporated, Philadelphia

Thursday, March 13, 1958

Elkan, Cowen A Co., New York; Bob Brearley, Wood, Gundy A Co., Inc., New York; Ellwood
Robinson, Penington, Colket A Co., Philadelphia; Belford Thompson, Girard Trust Corn Exchange
Bank, Philadelphia; Ransom Berneburg, Wood, Gundy A Co., Inc., New York; Jack Daly,
Wood, Gundy A Co., Inc., New York

Eddie
S.

DISTRIBUTORS -DEALERS
r

-State

Municipal

Bank

Insurance

•

Corporate Securities

•

Stocks

Mutual

•

Funds

Pennsylvania Authority & Revenue Bonds
New

Public

Housing Authority Bonds

We maintain active trading markets in unlisted securities
Inquiries

Pennsylvania

Inactive

Securities

Invited

Arthur L. Wright & Co., Inc.
225 SOUTH 15TH

STREET, PHILADELPHIA 2

Philadelphia Telephone
KIngsley 5-1060
New

York

Bell

System

Teletype

PH—255

City

Telephone:

DIgby

4-5951

Direct Private Wires To:
Charles King A Co., A. W. Benkert & Co. Inc., Wm. V. Frankel & Co. Inc.,
New York

Eddie

Stroud

Public Utility • Railroad
SECURITIES
New

Stein, Asiel A Co., New York; Jack Fant, Penington, Colket A Co., Philadelphia; Allen Foard,
A Company, Incorporated, Philadelphia; Ken Stanford, F. S. Smithers A Co., New York City

Industrial

•

Jersey and General Market Municipal Bonds

Electronic and Television Securities
Guaranteed

and

Leased

Equipment Trust

Line

Stocks

Obligations

Bank and Insurance Stocks
Mutual Funds Shares

Charles A. Taggart &
Member

Philadelphia-Baltimore

Associate Member

Boston

Stock

Co., Inc.
Exchange

Exchange

Investment Securities
1516
KIngsley 6-0900

Locust Street,

Teletype PH 677

Philadelphia 2, Pa.
New York Phone WHitehall

4-7000

Jack
New

Cliff

Carothers, Janney, Dulles A Battles, Inc., Philadelphia; Sam Englander, Englander A Co., Inc.,
City; Jack Kearton, National Quotation Bureau, Philadelphia; Bill Burke, May A Gannon,
Inc., Boston; Frank Gorman, H. G. Kuch and Company, Philadelphia

York

Remington, Woodcock,

Hess, Moyer A Co., Inc., Philadelphia;

Jack Klinger, Goldman, Sachs A

Co., Philadelphia; Leon Dorfman, Goldman, Sachs A Co* New York; Sid Siegel, Siegel A Co., New York

Volume

187

Number

5724

The Commercial and Financial Chronicle

PICTORIAL 11

WMM

Stan Roggenburg, Roggenburg & Co., New York;
Wally Runyan, Hemphill, Noyes & Co., Philadelphia;
Tom Love, Geo. E. Snyder & Co., Philadelphia; Sam
Kennedy, Yarnall, Biddle & Co., Philadelphia

James
Hunter

Traviss, S. J. Brooks <ft Company, Toronto; "Duke" Hunter, Wellington
Associates, Jersey City, N. J.; A. R. Smith, Bank of Montreal, Toronto;
Russ
Ergood, Stroud <ft Company, Incorporated, Philadelphia

Rambo, Close & Kerner
Incorporated

1518 LOCUST ST., PHILADELPHIA 2, PA.
Phila.

Telephone

New

PEnnypacker 5-2800

York

REctor

Telephone

Teletype

2-2820

Corporate and Municipal Securities
EDMUND J. DAVIS

WALTER G. NELSON

Vice President in
Jim

Mundy, Suplee, Yeatman, Mosley Co., Incorporated, Philadelphia;
Bill Radetzky, New York
Hanseatic Corporation, Philadelphia;
Jack Christian, Janney, Dulles & Battles, Inc., Philadelphia;
Samuel Gold, New York Hanseatic Corporation, New York; Frank
Ronan, New York Hanseatic,
Corporation, New Ycik
"

Charge of
Corporate Department

Manager of

Municipal Bond Department

Hopper. Soliday & Co.
Established
Members

1872

Philadelphia-Baltimore Stock Exchange
—

•

Brokers and Dealers in

LISTED

AND

UNLISTED

SECURITIES

Trading Department

Joseph A. McNamee
1420
Telephone
Ned
Bill

Walnut

—

John Gibson, Jr.

Street, Philadelphia 2, Penna.

PEnnypacker 5-4075

Teletype

—

Phillips, Samuel K. Phillips & Co., Philadelphia; Joe Cummings, Brooke & Co., Philadelphia;
Carroll, Eastern Securities, Inc., Philadelphia; Bob Kenney, Janney, Dulles & Battles, Inc.,
Philadelphia; Don Hall, Hoit, Rose & Company, New York

Investment Securities
LOCAL

—

LISTED

UNLISTED

—

H. A. RIECKE
(Member Phila-Balt.

CO., Inc.
Stock

Exchange)

1519 WALNUT STREET

PHILADELPHIA
RIttenhouse
Direct

Private

2. PA.

6-8120

Wire

TROSTER, SINGER & CO., NEW YORK
INQUIRIES INVITED
Bill Meyers, Gordon Graves & Co., New York; Harry Green, Merrill
Lynch, Pierce, Fenner & Smith,
Philadelphia; Samuel Weinberg, S. Weinberg & Co., New Ycrk; Jack Colgan, Weeden & Co., New York

593

Bob

The Commercial and Financial Chronicle

PICTORIAL

Brooks, Schmidt, Poole, Roberts A Parke, Philadelphia; Leri Bailey,
phia;

White, Weld A Co., Philadel¬
Co., New York;

Homer Wirth, Mabort A Co., New York; Jack Gessner, Mabort &
George Harrison, Laird, Bissell A Meeds, Philadelphia

Barney Nieman, Carl Marks A Co., Inc., New York; Jack Barker, Lee Higginson Corporation, New
York; Barney Conlon, P. F. Fox A Co., Inc., New York; Joe Blumberg, Goldman, Sachs A Co., New York

b asic analysis

ervice

Thursday, March 13, 1958

Joseph F. O'Brien, Jr., Harry C. Dackerman A Co., Philadelphia; Alfred S. Warner, Swain A Company,
Inc., Philadelphia; Peter Schult, Jr., Adams A Peck, New York; Charles E. Downs,
Swain A Company, Inc., Philadelphia

Walter Bradley, B. W. PizziniCo., New York; Tom Krug, Bioren A Co., Philadelphia;
Hecker A Co., Philadelphia; Percy Ayres, Merrill Lynch, Pierce, Fenner A Smith,

John Milburn,
Philadelphia

Market facilities

Singer, Bean & Magkie, inc.
40 EXCHANGE PLACE

HAnover 2-9000

•

NEW YORK 5, N. Y.

NY 1-1825 & 1-4844

FIRM TRADING MARKETS
IN OVER 350 STOCKS

*
•"
♦

Direct Wires
•>'

Henry

•

Burton J. Vincent & Co.

Los Angeles

Chicago

Reynolds & Co.

Dallas Rupe & Son, Inc.

Philadelphia

Pallas

Ecroyd,

Provident

Tradesmen's

Schmidt, Poole, Roberts

Evans MacCormack & Co.

<ft Parke,

Newburger

Bank,

Philadelphia;

Co.,

Philadelphia

Frank

Walter

Schmidt,

Newburger,