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ESTABLISHED
«5S
at
Chronicle
Ret. U. B. Pat. Office
Volume
181
Number 5416
New York
EDITORIAL
As
j
Fulbright "study" of the stock market has
to
come
Implications of
Guaranteed Annual Wage
We See It
welcome
a
close.
It
not
was
jfhe beginning,
from
Baruch's coup
de
there
always
real
"issue"
unlimited guarantee
with
might be found in Wall Street for
a
pay-roll
concludes
and
those who
Guar¬
a
any
connected
these
with
proposals,
which is intended to
program
paid to those employed would result in
income for the
much
as
pay
we
increase in
an
have
we
is
as
from production
area
still
actually stepped
have
long
a
I
All
other abuses such
as once
characterized the
economic groups desire
income.' In
recent
increasing emphasis by workers in
dustries.
Such production workers
concerned
can
Let
to
be
no
one
suppose,
however,
likelihood
some
that
as
some
nomic
on our
hazards
hands
lurk in
our
that
the
has lagged
protection
in
registers it. Unfortunately, this thermom¬
always fully responsive to underlying
conditions, but tends rather to register semi-
of
than they did when the
At
unions
have
the
demanded
time,
same
that
workers
tially their full wage when jobs
several
be
were
paid
terest
lost
pro¬
registered quit^ erroneous ideas of what
\
J.
Peter
"'An
address
vancement
of
by
Prof.
fcefore
Backman
Management,
York
New
SECURITIES NOW IN REGISTRATION
the
Society
City, March
Underwriters,
—
11,
-the
investment
in
spirit
sides
of
the
of
the
Continued
address
Investment
Ad¬
16,
and
op¬
from
groups
Rio
Grande
on
was
page
28
1955.
dealers
by
Mr.
Bankers
before
Grace
Association
of
Central
the
America,
States
111.,
Chicago,
36
Group,
March
1955.
investors
in
cor¬
registered with the SEC
"Securities in Registration" Section, starting on page 48.
porate securities are afforded a complete picture of issues
potential undertakings in our
for
this
progressive. Just to give you an idea of the type of
people attending this Conference, I ran into one group
of businessmen who told me that they had between $25
'An
35
the
and
Grace, Jr.
in this
page
of
The amount of real in¬
generated
both
substan¬
on
his
portunities in Latin America was
amazing.
The
representation at the Con¬
ference was of the highest quality
lost.
Continued
New
continents
botn
from
men
large
Guaranteed wage plans have been in operation
and
progres¬
Orleans
very
of
tremendous job of bringing to¬
a
hemisphere.
Government officials,
started.
the
gether almost 1,003 serious business¬
others have noted
this lag and called upon the State
legislatures to correct the situation.
Jules Backman
popular impressions of current conditions—which
are not always fully in accord with the facts. In
and
did
Luce
Henry
and
businessmen
sive
union leaders, and
eter is not
DEALERS
organization
be¬
the
and
Mr.
Orleans.
today
terms
at
by Time-Life
City of New
co-sponsored
International
workers receive relatively less
wages
gram
Thus,
month
this
earlier
Orleans
New
the Inter-American Investment Con¬
rise in wages of the
'Fifties.
and
income
which
page
of
more interest in many
Perhaps some of you were in
ference
income
laws
'Forties
no
on
present to you a prospectus of Latin
it to your skilled analysis.
Latin
However,
unemploy¬
hind the sharp
quite right in saying that the stock market is
not the cause of fever, but merely a thermometer
Continued
job.
a
ment insurance
is
1929 it
liberalization
the
suppose,
major
path. Mr. Baruch
or
to
par¬
a
go.
submit
employed. Unem¬
attending the loss of
many
problems
and
income
of
tial offset against the loss of
merely because the Senator could not find any
abuses in the stock market, that we have no eco¬
economic
loss
to
parts of the United States.
paid
and
ployment insurance provides
there seems
will
the
about
when they are not
the
Fulbright effort
safely be left to historians to deal with.
so
hired
are
in Latin America,
Cautions American
out of local politics.
up our pace
way
America is developing more and
production in¬
mass
like
would
America
given
by the hour and understandably are
mar¬
ket, the matter had better be left wholly to nat¬
ural forces to correct. And
protection against loss of
this objective has been
years,
raw
investors in Latin America to stay
unemployed.
-
—
of
trial economy under which the
(3) limited guarantee
Disdusses some eco¬
unemployed substantially
are
materials to an indus¬
inhabitants can raise their
living standards. Cites recent entry of American firms in
Latin America, and the program of American partnership
with local concerns. Reveals recent large investment of
chemical concerns in South America. Concludes, though
that
(2)
pay;
and magnitude of our
trend in
the importance
stresses
financial stake in Latin America and points to
as:
fund.
reserve
considerations
nomic
Mr. Grace
with proviso to protect employees
designated seniority, and
related to
juse in the election campaigns next year. It had
already become clear that no such investigation
as
this could really determine whether stocks
were " too
high" or not—as it should have been
clear that such a question was scarcely one for
Congress to concern itself with. If a few investors
or
speculators, for that matter — insist upon
bidding some stock up to a point not warranted
by the facts, then in absence of manipulation or
for
Wage and classifies the schemes
unlimited guarantee of 52 weeks' full
(1)
hardly needed to put
j an end to the hope of some of the politicians that
a
Annual
anteed
President, W. R. Grace & Co.
York University
Professor of Economics, New
Professor Backman describes the proposals
to find. Mr.
were none
grace was
In Latin America
By J. PETER GRACE, JR.*
By JULES BACKMAN *
wholly "friendly," but it was unable to uncover
any rnajor abuses—since, as most of us knew
Copy
a
Oar Investment Stake
Economic
The
Cents
40
Price
7, N. Y., Thursday, March 31, 1955
now
State and
in
U. S. Government,
State and
Municipal
Securities
telephone:
HAnover 2-3700
CHEMICAL
NATIONAL BANK
of INDIA, LIMITED
Bankers
to
the
Government
STATE
London, E.
End
RESEARCH
BONDS
C. 2.
EXCHANGE
"INVESTING
IN
THE
BANK
Protectorate.
Authorized
£4,562,500
Paid-Up
department
THE NATIONAL CITY BANK
£3,104,687
Fund
Reserve
The Bank conducts
bond
ON
£2,851,562
Capital
Capital
banking
and
Trusteeships
also
every
undertaken
14 WALL
Bond Dept. Teletype: NY 1-708
Net
123 Years of Service
to
Active
Markets
Brokers
Orders
Executed
On
CANADIAN
American
Stock Exchange
50 BROADWAY, N. Y.
BRIDGEPORT
PERTH
AMBOY
DIRECT
WIRES TO
MEMBERS
115
NEW
BROADWAY
NEW
YORK
We
offer
to
1
STOCK
COMMON
buy the above Warrants and
Dominion Securities
Corporation
Co.
Associate
V0RK
EXCHANGE
NORTH LA SALLE ST.
CHICAGO
YORK
Electric Service Co.
April 29, 1955
MONTREAL AND TORONTO
&
BANK
OF NEW
Southwestern
Analysis
Rights at the current market.
DEPARTMENT
Goodbody
CITY
1955
All
Teletype NY 1-2270
Members N. Y. Stock Exchange
OP THE
Telephone
Rights expiring
Canadian Exchanges At Regular Rates
T. L.WATSON &.CO.
NATIONAL
Company of Canada
SECURITIES
Commission
expiring May 3,
The Bell
CANADIAN
Our Customers
Exchange
STREET, NEW YORK 5
Imperial Bank of Canada
Maintained
Dealers, Banks and
CHASE
THE
34 offices from coast to coast
Warrants
To
Band Deportment
REQUEST
Members New York Stock
exchange
and
AGE"
AVAILABLE
HARRIS, UPHAM & C?
OF NEW YORK
description of
business./
Executorships
ELECTRONIC
ARE NOW
Burma, Aden, Kenya, Tanganyika,
land
STUDY
Branch:
(London)
13, St. James's Square, S. W. 1.
Branches in India, Pakistan, Ceylon,
Uganda, Zanzibar, and Somali-
CORN
;
Bonds
COPIES OF OUR NEW
in
Kenya Colony and Uganda
Office: 26 Bishopsgate,
Head
West
Municipal
m
MUNICIPAL
mo
40
Member American Stock Exchange
Exchange Place, New York 5, N. Y.
Teletype NY 1-702-3
WHitehall 4-8161
upon
request
IRA HAUPT &CO.
Members
,
and
New
other
111
Exchange
Exchanges
Stock
Broadway, N. Y. 6
WOrth 4-6000
Boston
York
Principal
Teletype NY
Telephone:
j
1-270)B
Enterprise
182p
The Commercial and Firancial
2
Chronicle
.
.
Thursday, March 31, 1955
.
(1494)
tfor Banks, Brokers,
Dealers
in
& Equipment
participate and give their reasons
for favoring
(The articles
"A"
Investors Div. Services
Lithium
Corp.
Long-Bell Lumber of Mo.
Brooks &
Co,. Inc., New York City
Northern Illinois Gas
Pan American
Treasurer, P. W.
Assistant
Glan-Gery S!tala Brick
Sulphur
Glen-Gery
Republic Natural Gas
apparent
weakness to justify this situation
when
New York Hanseatic
securi¬
being
are
Corporation
Associate
7120
g e
rather
Member
Stock
Broadway,
here
Direct
York
New
Boston,
Private
a
5
to
Wires
Chicago,
Cleveland,
Houston, Los Angeles,
Philadelphia,
Portland, Me., Providence, San
Francisco
an
Specialists in
Since 1917
jffipONNELL & CO.
Members
York
American
120
Stock
Stock
Exchange
Exchange
BROADWAY, NEW YORK 5
TEL. REctor 2-7815
Trading Markets
American Furniture Company
Alabama-Tennessee Natural
Gas Company
Company
Dan River Mills
Scott, Horner &
Mason, Inc.
Lynchburg, Va.
LD 33
Tele. LY 62
Since
1932^Specialists in
VIRGINIA-WEST VIRGINIA
NORTH and SOUTH
CAROLINA
MUNICIPAL E
IDS
•F. W/
CRAIGIE&CO.
RICHMOND, VIRGINIA
Bell System
Teletype: RH 83 & 84
Telephone 3-9137
Trading Markets
Indian Head
Mills
Preferred
experimentation involv¬
the
in
numerous
textures
Glen-Gery brick.
of
colors,
and
position
has operated
the company
War II
plants
substantially
at
ca¬
pacity.
(3) Profits of $652,000 were at
a record level
in 1954, and, since
all indications
its
own
kets
of
of
and
dealers
Maryland
and the New
proximately $6,180,000 has been
expended to expand plant capaci¬
ty, to increase manufacturing ef¬
ficiency and to diversify and im¬
prove the quality of the company's
products. Largely as a result of
such expenditures, pretax profit
margins, which ranged between
5.4% and 6.5% from 1940 to 1942,
have sharply widened, increasing
to between 20% and 28% in each
of the
(6)
only by
The company in 1954 em¬
upon a $5,000,000 4-year
barked
securities
consisted
of
shares of 6% first pre-
Capital
130,129
stock, $10 par (convertible
of common stock),
lerred
and
and
two months of 1955 are
mand continues to grow.
ago,
(7) Earnings per common share
in 1954 were 78c and dividends
built
1908
incorpo-
and
company's ten plants have
floor space under
approximately 1,100,000
tinct
have
and
been substantially re¬
improved
in
recent
term
the
company's first tunnel kilns.
25 Broad St., New York 4, N. Y.
Phone: Dl 4-4460
Tele: NY 1-3222
1953
1954
26.1%
20.9%
20.0%
19.7%
Hydraulic Press Brick—
17.8
19.3
12.4
14.3
14.2
Illinois Brick Co.
11.2
6.9
6.0
11.6
15.3
Metropolitan Brick Co.__
16.1
19.1
17.4
16.4
N.A.
Co.
19.6
16.6
7.8
4.5
N.A.
19.3
19.5
13.5
14.1
_
Sayre & Fisher Brick
United Brick & Tile
♦In
liquidation.
_
N.A.—Not available.
write
or
Yamaichi
Securities Co., Ltd.
Established
Home
1897
Office Tokyo—70 Branches
Brokers
Bankers
Investment
&
111 Broadway,
N.Y. 6 COrtlandt 7-5680
Established
there
H. Hentz & Co,
Members
recorded
past should not be main¬
York
New
Exchange
Cotton
York
New
Exchange
biocK
Stock
American
Exchange
Exchange
New Orleans Cotton
exchanges
other
and
Trade
of
Board
Chicago
Inc.
Exchange,
Commodity
to be no reason
seems
1856
why the steady progress
the
in
N.
earnings and dividends.
Chicago
WILSON
S.
YORK
NEW
Miami
EDWARD
Exchange Bldg*.
Y. Cotton
tained, with resultant larger sales,
•
Hollywood.
Fla.
•
•
Geneva,
Manager, Reseaeh Department
4,
Detroit
Beach
N. Y.
Pittsburgh
•
Coral
Gables
Beverly H.'lls, Cal.
Switzerland
Amsterdam,
Holland
Hallgarten & Co., New York City
Member New York Stock Exchange
Marshall Field & Company
In
the
opinion,
our
common
Field, the great¬
Middle West retail
stock of Marshall
est
in
name
circles for over 100 years, is
defi¬
nitely "behind
LAMBORN & CO., Inc.
YORK
NEW
5, N. Y.
depart¬
store
ment
SUGAR
equities at the
present time.
current
The
on
STREET
WALL
99
market"
the
for
of
5.8%
well-
the
dend
Raw
Refined
—
—
Liquid
Exports—Imports—Futures
$2
secured
divi¬
DIgby 4-2727
is
rate
I) above the, .av-,
erage;
;
h More-
over,
-
the
ditional
Wilson
S.
Edward
to
from four
stores
proposed
the
over
be
new
next
worthwhile
indicates
ad¬
earn¬
H0\JR
expected
ings
is relatively
of
derived
suburban
three
years
capital
ap¬
light and, as
a
million
Field's,
city's
largest
N. Q. B.
1
OVER-THE-COUNTER
INDUSTRIAL STOCK INDEX
store,
main store in the
14-Year Performance
35 Industrial
of
Stocks
"Loop" has long been famous not
only
Middle
West
but
the world.
Marshall
the
in
throughout
Field, perhaps the greatest of the
merchant
princes,
bought
into
partnershin with Potter Palmer in
Continued
!
'SAV iNG^>
for
have grown together.
The block square
if
O
Sept.
on
the
•
result
the sale of Fieldcrest Mills
$26.6
years.
26.7%
_
Call
Over the longer
possibility.
feet. They are all located preciation possibilities. (We esti¬
in Pennsylvania within a radius of mate that these new stores could
about 100 miles of Reading, and, add at least 60 cents per share to
earnings.)
Capitalization
while originally built many years annual
1933
_
potential.
of Japanese
square
Pre-Tax Profit Margins
GLen-Gery_
knowledge
with
investors
aggregating 50c are a dis¬
dends
substantial earner.
1951
1950
Exchange
compar¬
30, 1953,
working capital is greater than
totaled 45c. The common stock is
Glen-Gery's postwar capital ex¬
required in the company's normal
currently quoted in the over-the- penditures of $6,180,000 were
business even allowing for the an¬
counter market at
5Yt bid, 5^ largeley for improvements and
ticipated expansion program.
asked,
providing the unusually additions to facilities and included
Since
its
formation
in
1852,
the installation in 1950 and 1951 of
generous return of about 8Y2%.
in
investors with vision—
to
profits are expected to reach a
new
high, in which event divi¬
one
an'aggregate
of
have unusual appeal
may
period last year. The outlook
for the full year is promising and
and Chicago
Members New York Stock
well-ahead
the
in
realized
those
of
competitive condi¬
of these plants
last year, including a third tunnel
kiln, this division should hence¬
The
offices
SECURITIES
able
output) has been on an unprofit¬
able basis. With the complete re¬
a
branch
common
common
roof
Founded
(9fiP-enheimm <&
of
shares
817,741
of these facilities (ac¬
counting for roughly 15% of total
of
our
JAPANESE
stock, 50c par.
Sales and earnings for the first
operation
building
to
Delaware
England states.
more
wires
Direct
into two shares
yield
of capital improvements
and expansion, a major objective
of which will be to adapt addi¬
tional facilities to the production
of oversize brick, for which de¬
program
of $3,186,000.
liabilities
total
and
tions, but more importantly to the
fact that, since the acquisition of
the two York plants in 1952, the
forth be
postwar years.
compared favorable with
current liabilities of but $1,036,000
in other
principal markets are
Pennsylvania, New York, New
NY 1-1557
La. - Birmingham, Ala.
Mobile, Ala.
program.
and
000
Exchange
York I, N. Y.
New Orleans,
improvement and expan¬
On Dec. 31, 1933
current
assets
of $3,462,000 in¬
cluded cash items totaling $2,732,-
sion
Its
point to a continu¬ Jersey,
a
its
of
continuation
the
Exchange
Stock
American
capital
high level of building
Our belief that Glen-Gery's fa¬
activity, profits and dividends are
cilities are the most efficient in
likely to be higher in 1955.
the industry is supported by the
(4) Glen-Gery offers a wider
tabulation below of pre-tax profit
range of colors, textures and sizes
of brick than any other producer margins for those brick companies
in its area.
One-third of output for which financial information is
is free of competition in that it publicly available.
consists of types of brick not made
Note,
moreover,
that
GlenGery's profit margins since 1952
by any competitor.
(5) Since World War II, ap¬ have been. adversely affected, not
ation
strong
salesmen in the local mar¬
distributors
in
exceptionally
is
for
able
surrounding its plants and to
areas.
products.
with substantial cash funds avail¬
varieties
sizes
Stock
York
New
HAnover 2-0700
continuous,
a
company's current financial
The
second
to none
due
The company's output consists
largely to its extensive and con¬
largely of standard size brick,
tinuing program of plant modern¬
which is used primarily for ex¬
ization
and
expansion,
whose
terior walls and to an increasing
profits are at record levels and extent for decorative interior use.
whose common stock, neverthe¬
In addition, the company has been
less, is selling at but 6.9 times '54
rapidly increasing its production
earnings to yield about 8.6% on
of "oversize" brick, for which de¬
last year's dividends.
mand
continues
to
grow
due
Summarized below are the high¬
largely to the savings in construc¬
lights of this interesting situation
tion costs afforded thereby. Sales
together with a more detailed de¬
of
oversize brick currently
ac¬
scription of the company's busi¬
count for approximately 20% of
ness.
the company's sales, and a major
(1) Glen-Gery is the largest
objective of the proposed plant
producer of face brick in the East.
improvement program will be to
(2) Sales have increased in each
adapt additional facilities to its
of the past ten years, rising from
manufacture.
$807,000 in 1944 to a high of
Glen-Gery products are sold by
$6,457,000 last year. Since World
all
Commonwealth Natural Gas
sulted
Bcringcr
parently
Rights & Scrip
New
M.
Stuart
ap¬
is
permit
diversification of
wioer
manufacturing process
and
the
addition of sand
and
chemical coloring matter have re¬
uninterrupted
ciency
hav¬
tions in the
upward trend,
whose
efi'i-
Members
Members
kilns
These
ing the blending of various types
of shale or clay, controlled varia¬
sales
in
2).
19 Rector St., New
permanent
Constant
have for years
been
&
(Page
colors as well as
advantageous structural, absorp¬
tion and strength characteristics.
industry,
whose
Steiner, Rouse & Co!
Co., New York City.
garten
The company
ing
prosper¬
a
ing
last year.
of
Hall-
Manager
Department,
Research
Bought—Sold—Quoted
Company—Ed¬
&
Wilson,
S.
ward
long-term
hardened, well-burned brick
aged company
that is a leader
in
million
171
to
Field
Marshall
manufactures face largely automatic burning opera¬
brick used in the construction of tion with
very substantial savings
practically all types of residential, in labor costs. All kilns and stor¬
commercial and industrial build¬
age areas were placed under cover
ings, hospitals
and government to permit all-weather production,
buildings.
The
brick
is made and plants were mechanized and
largely from shale, the use of re-equipped to increase efficiency,
which
permits
the making
of improve quality and permit a
superbly man¬
PHILADELPHIA
BOSTON
is
1946
in
P. W. Brooks
Co., New York City. (Page 2).
&
1939,
Louisiana Securities
Brick Corpora¬
Beringer, As¬
sistant Treasurer,
growth. During the postwar pe¬
riod
shipments have more than
doubled from 83.8 million brick
Exchange
Teletype NY 1-40
WOrth 4-2300
nerously.
For
1920
no
general
valued
American
stock im¬
strikingly under¬
with
issue
valued
ties in
Established.
Corporation
steady,
of
record
M.
tion—Stuart
has had an impres¬
business
sive
common
presses me as a
Westend Chemical
this
in
Pennsylvania
in
rated
BERINGER
M.
STUART
Shale
Glen-Gery
are not intended to be, nor
sell the securities discussed.)
contained in this forum
they to he regarded, as an offer to
are
particular security.
a
Alabama &
Selections
Their
which, each week, a different group of experts
the investment and advisory field from all sections of the country
Dan River Mills
Participants and
Forum
A continuous forum in
Oil
Canadian Superior
Concord Supplies
Week's
This
I Like Best
The Security
on
page
41
FOLDER
ON
REQUEST
National Quotation Bureau
Incorporated
46 Front Street
New York 4,
N.Y.
Volume
181
Number 5416
.
.
The Commercial and Financial Chronicle
.
B. S.
Articles and News
AND COMPANY
Cover
—Jules Backman
By FAYETTE B. SHAW
Peter
—J.
EAST
Stake in Latin America.
Our Investment
University of Illinois
Cover
Grace, Jr
all
Responsibility of Federal Reserve and Bankers in
Shaw
describes
the
banking
whereby the
an infla~
process
Avoiding Inflation—Fayette B.
receiving of deposits and the making of loans have
Arizona:
tionary effect. Says bankers also contribute to inflation by
buying bonds directly from the government through the process
of crediting the government with the amount of the purchase.
I
-
A Look
the
near-term
From Boom to
time.
Over
s
e
t
the
u
the
years,
safeguards
t o
p
dollar
have
been
€
d
e
n
n
the
around
Federal
Re¬
have
lessened,
and
all.
—Stuart
But
we
production,
and
is that
the
policies will be
which
\yill
be
infla¬
tionary, with the possibility that
the dollar will go the way of the
mark, the franc, and the lira.
this
is
to
be
prevented,
the
inflation.
only lend their
asset
they are not the only
.groups which should feel such re¬
sponsibility.
of
though
themselves
bankers
the part they play
<do
not realize
as
individuals
promoting inaddition to making a
in
profit for the bank, two attitudes
-dominate their thinking, both of
which are inadequate in evalua¬
First,
influence.
feels
that
he
should
a
ac¬
commodate his customers. Second,
the
banker
deposits.
his
lends
Both of these are partly
When
in error.
loan officer sits at his
a
talks
and
desk
over
with
a
cus¬
proposition of a loan,
ihe wants to protect the solvency
•of the bank, he wants to serve a
tomer
the
acquires a new
the heading
and
discounts.
If the
takes the proceeds in
loans
borrower
there is
What
fect.
the
usual
is
depositors
Business Trends—J. Ross
Oborne and Herbert C.
17
t
ready to be spent on goods
services, just as cash would
and
be
purchasing power has
created out of thin air. Of
used.
New
been
the reserve ratio must be
course,
maintained.
Outlook
19
for
Non-Ferrous Metal Market—Simon
enough.
of
legal
deposits
reserves,
exceed
not
the Federal Reserve or rediscount
banker it seems obvious
lends his deposits.
His
customers bring their money in
and leave it with the understand¬
he
with
M.
'
Executive
Malin
—V.
Henry
Under the
if
:!t
it,
and add
the bank's
the proceeds to
Fulbright
Stock
Market
Continued
on
page
PREFERRED STOCKS
New York Stock
Investigation
Albany
•
Nashville
•
II.
L.
Way
http://fraser.stlouisfed.org/
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Federal Reserve Bank of St. Louis
Glens Falls
to
Salt
Philadelphia &
Lake
City
22
24
Basic Atomics
Sangster Cites Capital Gains Tax Inequities
(Letter
Sound
Editor)-.-^.
to
Frederick
Shull
Finds
Money
Consol.
33
Fault
Principles
With
Secretary
Burgess
Diesel
Guild
on
(Letter to Editor)
Elec.*
Films, Inc.
45
Standard Uranium
Regular Features
As
We
Bank
See
and
Hycon Mfg. Co. Common
It
(Editorial)
Cover
Stocks
Insurance
Businessman's
Bookshelf
Steel
37
*
56
__
Coming Events in the Investment Field
5
Dealer-Broker
8
Investment
Another
General
Recommendations
Election
From Washington Ahead
44
in
Worcester
We
Products
Prospectus
maintain
than
250
on
Eng.
Request
trading markets in
over-the-counter
more
securities
Singer, Bean
& mackie, Inc.
20
.
10
47
Mutual
42
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Funds
Notes
Banks
Reporter
Our
Utility
Railroad
Bankers.
and
Wilfred
May
Report
Now in
Prospective
Securities
55
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.
and
.
24
j.
Security
Corner
State
of
Trade
and
Washington
and
2
;_.
Industry....
1
Drapers'
Gardens,
DANA
HERBERT
D.
4
COMPANY, Publishers
SEIBERT,
Thursday
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E.
Copyright 1955 by William B. Dana
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WILLIAM
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CHRONICLE
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56
Weekly
Reg. U. S. Patent Office
WILLIAM
16
You
Twice
Mid-Continent
43
Security I Like Best
Firmly Believe
53
___;
You—By Wallace Streete..
The
We
48
Offerings.
The
WHY
43
Registration
Salesman's
The Market
5
41
Securities..
Securities
Securities
Direct Wires to
Philadelphia ..Chicago.. Los Angeles
15
Governments
on
Reporter's
Public
40 Exchange PL, N. Y.
Teletype NY 1-1825 & NY 1-1826
8
About
Observations—A.
Our
Chicago
f
Britain"
of the News—Carlisle Bargeron
Indications of Current Business Activity...
state
<
Teletype: NY 1-4643
wires
Aver Purchasing
(Boxed)
Thursday, March
TELETYPE N. Y. 1-5
Chicago
Schenectady
Direct
:
Best
Exchange
•
•
Broadway, New York 4
8
Agents
It's The
Every
Boston
Took Wrong Track,
Business Boomlet Gathering Momentum,
ST., NEW YORK 4, N. Y.
TELEPHONE HAnover 24300
42
if
Says Guaranty Trust "Survey"_____
legal reserve. This can
Spencer Trask & Co.
Members
J. F. REILLY & CO.
Code
DIgby 4-4970
25 Park Place, New York 7, N. Y.
REctor 2-9570 to 9576
BROAD
22
Revenue
26
The COMMERCIAL and
25
1954
Rothschild
FINANCIAL
specialized in
20
^
Compensation
Published
For many years we
Oil & Gas
Einzig: "Pros and Cons of
example: Suppose the bank
must maintain a legal minimum
reserve ratio of 20%. On $10,000,000
Strauss
D.
Advice to Retired People—Roger W. Babson—
For
must
Uranium
American States
18
account.
deposit
a
purchasing power which
exist before, but is now
is
not
application before him only concern.
on its
merits. The impact of the
However,
somewhere in the
loan on the borrowing company bank, officials are keeping tabs
is most important, on the com¬
on the actual reserve and the re¬
munity somewhat less so, and c.i quired legal reserve, and if the
the economy as a whole so remote
actual ratio is less than the re¬
as to receive only vaguely passing
quired, they sell bonds on the
attention. In a time when infla¬
open
market or to the Federal
tion threatens this may not
be Reserve
Bank, or they borrow at
have
Andreae..
Business of Refining Uranium Ores—Eugene B. Hotchkiss
cash is transferred
However, the
siders each
that
Stancan
14
,
of taking the proceeds
credit
to
did
Mining
Security Markets and
on
borrower.
way
Here
inflationary ef¬
have
no
some
brought in in
to
bank
under
posted
cash,
a
it
loan,
a
When
$50,000,000. But
the
loaning officer, considering
a
profit for the bank. A higher just this one loan, may have little
authority in the institution, per¬ or no conception of the limitations
haps
including himself as one of the reserve. Or perhaps he does
member of that authority, has es¬ understand this, but the making
tablished the framework of the of this particular loan does not
lending policy, and within that involve any such -consideration.
framework the loan officer con¬ The merits of this loan are his
good customer and thereby the
community, and he wants to make
To the
Barkin
they realize it
actively
inflation.
have
makes
banker
Sodak Uran. &
14
Suggested Revisions of the Selective Service Law
Whether
they
not,
or
responsibility of the banking sys¬
and of the bankers is great,
their
Edgemont Mng. & Uran.
13
-
Government Influehce
posits "out of thin air" as it were,
and thus contribute measurably to
tem
ting
Silloway
—Solomon
may
determine,
maybe individually, certainly col- ■
If lectively, whether a nation will
In
F.
12
—
Company Looks at the Equity Markets
Depression in the Textile Industry and the Way Out
deposits,, they also create new de- -
^
adopted
flaton.
Politically Inspired Inflation Wanted
or
Create Deposits
Can
But bankers not
Shaw
B.
Fayette
em-
Oftentimes
MINING
12
—
Wilson
E.
—Patrick
responsible
likelihood
Oare_
L.
Important Aspects of the Market—Ferdinand Eberstadt
sentiment that
government is
4-6551
11
—Robert
that
Banks
WHitehall
10
A Life Insurance
fidence in futures-
growing
iployment
Telephone:
.
management
.the
for full
WALL STREET, NEW YORK
deposits
been
with
at
the insurance of bank
plus
such
responsible
that customers will
always have confidence in their
bankers will prevent loss of con¬
hope
System
serve
Advantages of Short-Term Trusts—L. William Seidman.
let 'em down!
never
they did
as
function
not
99
7
.
A. Livingston
ob-
cause
Obsolete Securities Dept.
6
Situation—Benjamin Graham__
No New "Upturn"
prior to and
leading up to the Bank Holiday of
1933, the,, banking system could
restrictions
throw
we
6
for Business—Ira T. Ellis
Doom?—J.
4
their
us,
-
these
deposits safely because he knows
desires,
as
_
to
9
—Robert
their money at thtT same time. If
they should have such distressing
weak-
Cobleigh__
soletes
Today's Challenge to Automobile Instalment Credit
by experience that not all of his
depositors are going to want all
protect the
U.
White
R.
the town.
bring
WHITE CANYON
longer-range problem is inflation.
lend
3
—
General Motors Looks Into the Future-^-Harlow H. Curtice-—
pects of business, the most serious
can
Shaw
Zoom—Ira
SIDE, VI EST SIDE
around
They
.___—
Tax
ing,
The. banker
for
Back and Ahead
The Stock Market
in the case of demand de¬
posits, that they withdraw at any
pros¬
"Z" Is
Kernels"—William
,
system's responsibility in avoiding undue expansion of credit
and keeping the public welfare in mind in making loans.
Whatever
The
"Railroad
\
Lists government budget deficits, and Federal Reserve policies,
as other sources of
inflation, and calls attention to the banking
IfllSTEIIl
Page
Economic Implications of the Guaranteed Annual Wage
Assistant Professor of Economics
Professor
3
INDEX
Responsibility of Federal Reserve
And Bankers in Avoiding Inflation
^
(1495)
80 Wall St., N. Y.
the rate of exchange, remittances for foreign subscriptions and advertisements must
be made in New York funds.
5
BO 9-5240
4
The Commercial and Financial Chronicle
(1496)
these
Arizona—the "Z" Is for Zoom
and
2.9%
in common
The
2,640,000
common
traded
over
the
counter
shares
Enterprise Economist
be
—to
through
sell about 24 and
now
specific Arizona Public Service Company.
electric
to
comes
population
and
cool
all*-, these'
qualities
make
not
to
popular
state
the
among
to
set,
but
Arizona lead in
ex¬
it also is
tops in rate of rise in retail sales,
farm
for
population;
of
pansion
consumption. For fanciers
of growth in our economic scene,
fancier
But
to
first
that
Co. and
rate
a
as
going
are
natural
Public
will.
we
merger
in by
It's
and
the
operating
in
1954
This income was
divided into 72% electric, 25% gas
and
3%
water
from
and
Fanning out from
Painted
Desert
Arizona,
across
River.
Colorado
Public
zona
Arizona
Yuma
on
in
10
(out
pany,
the
While
popularity
resort
rapidly
state
equally
$1,095,000
from
—
P.
S.
rapidly
power
major
and light enter¬
ment of
related
enlarge¬
plant, substation and dis¬
a
tribution
a
celerated rate, Arizona has offered
at
million in
known, the
facilities at such
in
common
1953
and, last
swiftly placed, mainly with insti¬
and
citrus
fruits.
$275 million in
the
$4.35
tutional
result,
a
for
company
preferred
investors.
stock
As
than
more
Management,
which
for
in
was,
in
were
result
a
of
dustrial
much
use
fact,
cited
for
its
heralded
by
.
.
But
and
most
some
about
the
people
thinking about
start
not
P.
in
nuclear
ically
wide
.
.
there
is
Arizona
switching!
being
will
explored
heading
company,
Mr.
is occasionally heard respect¬
ing possible water shortage. The
present supplies appear quite ade¬
quate, and if the state wins its
legal
battle
with
California
diversion
the
of
the
of
Colorado
Arizona >jwill
have
over
then
much
en¬
about
a
the
larged water reservoir.
Just
another
note
there
You
as
might
scarcely
seaport
a
yet
that
a
the
with perhaps only
northward extension
Gulf
of
seaport
To
shall
California, cre¬
in Southwestern
the
quotation
blossom
like
"the
a
rose"
shall
event, Arizona
good section for
any
ket issues into
ment
one
here
a
few
issues
that
we
make
markets
in—or
might
Detroit
Bank
Detroit
Harvester
Gerber Products
Michigan Gas
Co.
Utilities
of
Arizona
seems
a
utility
a
offering greater
zona
Co.
perhaps
is
son
National
Phoenix
Bank
of
Detroit
Kellogg Co.
Tecumseb Products Co.
Michigan Gas & Electric Co.
Upper Peninsula Power Co.
\
for
Just
stock
fill
visit
where
the
bill.
Ari¬
You still
in the winter
sea¬
there; perhaps to
are
'
located
some
70 PINE STREET
NEW YORK 5, N. Y.
Offices
m
106 Cities
L.
the
from
mills
the
fast
as
producers
as
can
it
probably
will
indicate
improvement^ and
an
on
such
a
'
_
r
breath-^
be another upturn following the summer
broad base
is just about certain in last half of the year;
Age" points out.
'
f
:
,
into
extensions
third
he
year
"
.
,
,
three weeks,
The
market.
the
at
automotive
and
Steel
In
forthcoming
talks
labor
of
outcome
moment.
'
definitely will be carryovers from
Some mills already are talking about
quarter.
to
up
.
there
products
of
Last
scheduled
over
delivery
after
X
April 15, continues this trade authority.
auto
the
steel
labor
odds
the
between
having
are
influence
an
negotiations
favor
the.
on
uncertain
are
peaceful
and
industry
settlement
United
the
of
Steel
Workers.
are
Concluding, this trade magazine observes that the chances
negotiations in steel will wind up with a moderate wage in¬
followed
crease
by
compensating price boost.
a
In the automotive
States-Canadian
due
were
to
car
be
industry,
eclipsed
the
all-time peaks set by United
new
truck
and
manufacturers
week
past
as
weeks
two
ago
producers
most
en¬
ing demand.
Automotive
"Ward's
programming indicated
U. S. passenger
(1)
Reports"
said
the
that
March
21-26
records in these categories:-
new
car
production—177,843 against previous
week's all-time high of
176,194; (2) combined U. S. car and truck
volume of 204,692 units, compared to a mark of 201,503 set two
weeks ago; (3) Canadian car production of 10,310 units, erasing
preceding week's crest of 9,872; (4) U. S. and Canadian car output
of
188,153 units, bettering the 186,066 volume reached during
14-19; and (5) a combined peak of 216,777 cars and trucks
from United States and Canadian plants.
The all-time top point
was
reached two weeks ago when 212,776 vehicles were built.
March
In
addition,
reach
a
combined
record
new
Canadian
in
the
and
car
latest
construction
truck
week.
Programmed
are
12,085 units, while the all-time high is 12,094 obtained during th&
ending May 2, 1953.
week
The
current
and trucks
cars
production
in
1955
pace
finds
(2,239,036)
United
States
output
running 37% above like
of
1954
Car volume (1,997,698 to 1,358,573 last year) is up by
is lagging by 11%.
(1,629,289).
47%, while truck output^ (241,338 to 270,716)
United
000
States manufacturers, meantime, expect to build 786,-
cars—a
new
monthly
record—and
bringing combined United States
quarterly
new
car
104,000
and
height of 2,379,000 jobs.
trucks in March,
truck production to a
Included
in
the
aggre¬
gate is the top quarterly car output (2,121,000); previous peak had
been
bined
1,898,783
car
Amer¬
monthly
and
in
July-September,
1950,
when
the
record
com¬
truck schedule
(2,249,284) was tabulated. The top
total thus far was reached in June, 1950 at 720,100
vehicles.
Service!
(Special to The Financial Chronicle)
LOS
new
has created tense feeling
Everyone is clamoring to get his require-*
books and
some
swimming pools are
and lighted by Arizona
Their
King Merritt Adds
Merrill Lynch, Pierce, Fen.ner & Beane
strength of the
for lost time.
up
The strength of the market rests
Steel
car
Operations Set This Week At 93.6% of Capacity
Steel
Trading Department
demand
pressure
buying because he needs steel and steel products.
was virtually out of the market.
like
common
of the swankiest resorts in
ica.
Public
contact-
left
a
purrmed
Latest quotes?
a
Service
zooming state.
a
have time
Michigan National Bank
Co.
growth,
Public
4
could
or seeking a new invest¬
involving a quite predictable
amount
are
for—
terrific
Along with automotive, construction, oil and gas, and con¬
tainers, the farm market is moving up strongly. Despite lower
commodity prices and reduced purchasing power, the farmer is
of
state;
bring,
lock,
a
think
certain plans afoot
are
is the
the
deavored to satisfy customer orders and meet anticipated market¬
)
interest.
>
water
River,
outlook
the critical production period just
This will pitch steel production to near-record levels
basis
"The Iron
the Associa¬
up
stability;
them
virtually
from
another surge
that
second
with
automotive
consumers.
the
ing spell.
In
tion for Applied Solar Energy.
Some adverse talk about Ari¬
Michigan offers.
find
pressure
underestimated
trying to make
are
There will
power,
Solar
Henry B. Sargent, President of the
Name some?
Well
to
equipment.
and
this short-term
makers
car
steel
on
be
in; and for those seek¬
ing to switch out of volatile mar¬
.
some
Commerce
continuation of the recovery movement.
the
in
When power is atom-
produced,
to operate
ears.
plans
of
before the downturn comes, declares this trade journal.
A summer leveling off can be expected. But on a seasonally-l
the
1954
reactor
power
Southwest.
basis for
handle them.
being
S. Co.
Mountain Nuclear Power
Study Group to project a plarj, for
pretty
thinking about stocks instead
variety of investment opportunities that
market
The
ments
eight others in
formed
region,
desert
of them st&rt
plants
automotive companies in
adjusted
may be added "the desert
blossom into a harbor!"
•
MICHIGAN
Department
buildup, spurred by
among
pro¬
Rocky
In
States
currently
new
Meanwhile,
1954
and
generation is
neglected at Arizona
'
for
market and
car
of atomic reactors for
electric
Arizona.
Just mention
industry
United
approaching its seasonal peak and indications
ahead.
electrification.
The
from
that
from
in
award,
given each year to the utility that
does the best job of promoting in¬
one
the
report from
The
new
America"
"More Power to
flow
transportation
April, states "The Iron Age,"
national metalworking weekly this week.
Ingot rate will reach
96%, perhaps 97% of capacity before leveling off.
be
generated
year,
Electric
zona
and
that the
are
promotions
million
$5
last
company
too,
metals
Steel demand is
ten
should
too,
business
added
business
in
increase in outdoor activ¬
an
the primary
all industry, will hit its high point in
credited
the
in
work
moderately increase its
This anticipated;
gain plus expectations of higher retail and wholesale activity
testify to confidence in the economic outlook in the months ahead.
years.
ating
.
A
with
been
have
claims in ^the weeky
new
claimants.
20% of the
over
employees
Arizona
in
to
expenditures
$15
million
recalls
states
As
ago;
year
equipment industries and the exhausting of benefit rights by
insurance, pension, and stock
purchase through payroll deduc¬
of¬
followed
Cotton leads,
livestock, vegetables
ities,
life
2 244
a
provement of the apparel industry,
ship, nurtured by a merit system
for advancement, a complete pro¬
gram
for hospitalization,
group
tion.
below
19%
were
Factors contributing to these declines included the continued im¬
It is
year,
stock
Two
$350 million in 1954.
by
This
were
million in bonds and $7^2
fered
in
of
lot.
a
5
ended March 12 dropped 29% from the comparable week in 1954.
only by the long range
progressive,attitud.es in the State
of Arizona may
prove of tooical
receptive public.
a
ranks
bringing
ac¬
an
regular intervals its bonds and
shares to
March
t has
is evi¬
a n a g e m e n
by fine employee relation¬
claimed
finance the
issues
one,
to
the
probably
as
growing
magnitude of its industry is per¬
haps less appreciated. Agriculture
number
in
taxes
after
time interval is
prise.
To
a
$160
net income
Arizona
increasing
tourist income) is well
remarkably
$34,548,000
to
was close to 9% higher.
nation's employment situation, continued
claims for unemployment insurance benefits in the week ended '
With respect to the
and
plant expansion cited above.
shown
a
advanced
The corresponding expan¬
American
com¬
a
denced not
gross
growth of this order that tabs
most
of the
residential and
(2 million visitors
as
bringing in
year
It is
counties, making its prod¬
population. Quite
in quite an area.
the
$9,335,000
same
for
counted
no
total production for the week
ago
year
this
This company with
$4,589,000 in 1954.
Also in the
same
decade, common dividends
rose
from
$594,000 to $2,376,000.
the
14)
of
principally
River.
at
interesting
40,000
covers
ucts available to about 62%
state's
the
M
sustained
progress -of,.
the
for
phesied
earnings
rewarding.
In the ten
period
1945-54,
operating
sion of
Altogether,- Ari¬
Service
miles
square
to
Natural
Paso
is
(1954).
the
northeastern
in
look
from
and' from
Douglas;
El
City of Yuma, piped from
revenues
looking utility spread from
Canyon on the North,
to
are
Colorado
year
miscel¬
the, Grand
down
the
curve
Phoenix, the facilities of this for¬
ward
by
Texas,
A
$34,548,000.
laneous sources.
supplied, and brought
gas
pipelines from New Mexico'
The water service is
produced
revenues
account
was
week, notwithstanding the fact that major advances were scored
in construction activity.
When compared with the like period a
climate, population and ter¬
enterprise.
About 125,000 gas
to
of
of
up
served.
270,000
total
made
customers
Arizona Light Co., and
Arizona Edison ©o., it now serves
and
is
Gas Company.
in 1952,
of Central
customers
needs, and buy¬
ing the rest.
utility by any stand¬
Formed
ards.
We
Just
General
around 75% of its
ex¬
Index
significant change in over-all industrial output
for the nation-at-large in the period ended on Wednesday of last
part
by
16
electric
appliance
perhaps shows throughout the State. This
producing
company
Gas distribution
Arizona
about
talk
Service
a
digress.
we
will
bring electric generating capacity
to
above 500,000
k. w. with the
power
you'll hardly find a
ample than Arizona.
this
time
some
construction
This
summer.
and,
electric
discussion,
today's
lines
transmission
deposits
bank
income,
new
unit
at
Red
Rock, half the canacity
going into service July 1, 1954 and
the
other
half
juicing up the
prosperity, progress and health to
be enjoyed in winsome weather.
Not only does
Since
.
million
gest recent outlay was the
200,000 kilowatt generating
folks looking for
younger
Service.
have been
spent on new construction—$26.6
million last year alone.
The big¬
$113.6
1945,
mighty attrac¬
tive
of
facilities
of
Public
Arizona
pension
ment
expansion
rapid
retire¬
Cobleigh
background in economic
geography has been presented to
both
explain ; and
justify * the
the
only
and
U.
All this
Arizona
most
Ira
1955.
have
There
ritory aloqe would not be enough
well .balanced^
mnve
Production
Business Failures
J
P.
25% Arizona residents.
to
mining and milling now
mining-might even
ahead of manufacturing in
'
Industry
Price
Auto
and
S. has a
large
and
growing
family
of
shareholders, 18,800 at last count,
under
way,
Commodity Price Index
Food
quite
be
can
Arizona
event,
any
uranium
in-
operated
million and with all the
with $263
but
stock,
Trade
Retail
State of Trade
a
easily explained by the historic
growth rate of the property. In
famous, put mining in third place
humidity—
gratiating me¬
teorological
%
Copper production,
has long been
Arizona
which
for
the
degree
right
of
was
and Motorola.
by
i g h t,
n
income
gross
Production
Electric Output
Carloadings
dividend for 1955, the yield is
just a bit above 4%.
This is a
little below average return for an
racked up last
growth, Arizona is our number year by manufacturing, with sub¬
one state:
A sunny climate, com¬ stantial
plant expansion in the
fortable
winter
by
AiResearch,
Reynolds
temperatures, area
warm
by day Metal, Royal Manufacturing Co.
it
When
assuming
Steel
The
$1
kaleidoscope of Kilowatts
a
if
in
preferred
stock.
By IRA U. COBLEIGII
A brisk look at Arizona
capitalization is
bonds, 16% in
flotations,
about 55%
now
Thursday, March 31, 1955
...
tions,
demand
says
and
"Steel,"
current week.
the
production
weekly
are
exceeding
many
expecta¬
magazine of
metalworking, the
Now that the first quarter is almost over, what is
ahead for the rest of the year?
ANGELES, Calif.—Ronald
Production will continue to rise in the second quarter, decline
Cummings has been added to
in the third and rise again the fourth, states this trade magazine.
staff
of
King Merritt & Co.,
Inc., 1151 South Broadway.
Continuing, it
says,
the years output of steel for ingots and castContinued
on
vaae
46
,
it-
Volume
181
Number 5416
.
.
The Commercial and Financial Chronicle
.
weighing of the relationship re¬
garding injury or fraud between
State law, Federal law, recourse
to State and Federal Courts, the
Observations..
.
the' State Commission;
overhanging by
the
inpecting agencies,
SEC,
"A Little Knowledge
~Fulbright Study of the Stock Mar¬
ket
are
concentrating
thusiasm
the
on
their
alleged
fruits
the
ceedings.
to
ference
(1)
But
the
us
based,
pro¬
education
is
the
that
are
the
for
dis¬
and
.*/:
and
of
associations
regis¬
securities
dealers.
While the "educational" value of
affirmatively
confused
Wilfred
May
bers
mem
the
these
the
by the
of
via
the
and/or
misled
gressional
Con¬
into this
Investigation
tion in
in
Stock
anticipated
this
in
the
to
the
and
that
not
are
of
after-thought.
done
much
This
to
establish
and
have
issues
would
clarify the
framework.
by
better
the
of
securities
markets
the
being manipulated in
con¬
Basic
:*
Clarification
the
increase
in
abuses.
Surely
of subsequent discussion.
finally
did
Likewise
before
appear
he
pointed
out
that basically the SEC has power
sideration
to
unmanipulated market; and that accord¬
ingly the Securities Exchange Act
point
of
make
Senators,
provide
1934
a
was
essentially
that
plained
He
existing
speculate;
that
of
dence has been
tive
will
of
the
basic
closures.
most
Tnis
the
v
>
V
r
difficulty of disillusioning
public
about
guarantee"
has
chief
their
reluctance
comparative
our
whose
to
I point
that
to
oc¬
of the witness chair—at
of
the
ramifications
challenge
governing authorities
dangerous thing.""
,■/' •' ;;
—a
the
this
on
COMING
of
diyorce
received
question
these
kind
here,
re¬
regulatory policy to meet
problem.
Ripe
was
Investment
In
Exploration
for
Field
conclusion
a
of
at
Frear
of
of assets to the
more
ing and liability provisions of the
Participation
Securities
Exchange
Act.
A
phenomenon tentatively
brought up throughout the Hear¬
ings
by Senator Lehman is the
growth in institutional and group
buying. The buying of equities by
insurance
sion
funds, whose available
amount to $66 billion,
now
of
the
Demmler
value
of
the
all
securities
markets,
Investment Bank¬
Association spring meeting
Texas Group
ers
Hotel.
at the Shamrock
Apr. 28-29, 1955 (St. Louis, Mo.)
Dealers
St.
Louis
Municipal
Group annual outing.
help in "ed¬
to
express any
on
the
merits
whatever
Apr. 29> 1955 (New y0rk City)
Security Traders Association of
New York annual Dinner at the
Waldorf
here,
opinion May 8-10,
or
National
de-
cial
merits.
A kindred
28%
receiving
securities
attention, is the
in-
Baltimore Security Traders
sociation Annual Spring
preferentially en¬
joying unlisted trading privileges
on exchanges while escaping some
of
their important corporate obli¬
of Mr.
limiting
thus
the
randum
That
through these group
purchases, which are made by
relatively few companies, it would
but
not be difficult for these groups to
was
(2)
control
gain
commercial
banking
of
industrial,
our
and
railroad
and
concerns,
thus
and
take
And
May
by
a
the
and
over,
on
On
the
meeting
Spring
field day
Country
administration
in conformity
N.
Board
(New Ytfrk City)
at the Sleepy Hollow
Club,
Scarborough,
1955
(New York City)
—
Municipal — ■
Forum of New York
conference on highway financ¬
relevant
ing.
(3) A general objection to their
We
are
pleased
to announce
that
our new
address will be
—
the
On
other
hand, in
institutional
ticipation
much
can
be
■
defense
investment
39 Sou th La Salle S treet
par¬
said,
Chicago 3, Illinois
as
Senator Lehman very broadmind-
edly
agrees,
"with
and
on
long-term
CHARLES
DONN
C.
DREIFUS,
EARL
JR.
-
DOUGLASS
HARRY P.
S.
reducing
EMMETT
FLACHS
DOUGLASS
CHESTER
JOSEPH
A.
A.
APY
desideratum
*
of
should
It
not
be
assumed
LARKIN
JOHNSON
sible
exercise of control is per se
STREET, SAN FRANCISCO 4
•
TELETYPE SF 812
mere
evil,
an
control
in
less
fact
of
their
pos¬
without explaining why
these" institutions is.
public interest than
by
Strais, Blosser & McDowell
the
existing system
real
GARFIELD 1-3886
control
lies
in
under which
non-owning
MEMBERS NEW
YORK
CORRESPONDENT, PERSHING &
CO.,
120
EROADWAY
YORK STOCK EXCHANGE
•
MIDWEST STOCK EXCHANGE
self
perpetuating
management
through the default by the scat¬
tered inarticulate owning stock¬
DETROIT STOCK EXCHANGE
NEW YORK
holders.
NEW
telephone number will remain ANdoner 3-5700
the volatile speculative
the
our
465 CALIFORNIA
Our
holding
attitude; and
element.
(2)
STERN
MARCH 28,1935
furthering the Committee's
professed
own
FRANCISCO STOCK EXCHANGE
W.
after
ac¬
that
CARL
arid
participa¬
informed
investment
an
hence
SAN
their
through
tivities
NEW YORK STOCK EXCHANGE
market
up-grading
tion
MEMBERS
example:
for
(1)
in
STERN, DOUGLASS & CO., INC.
as
Particularly germane to a
market study is their advantage
MILWAUKEE
(.3) The attachment of abuse to.
mere
reduction in the supply
limited?)
recurred,
of
stocks
here,
(un¬
as has
throughout these hear>,
,
•
of
Y.
June 8
which the Congress
thoroughly
of
Bond Club of New York annual
controversial
SEC's contention that it
matter
Sulphur
Governors.
should declare its intent.
their operation.
over
glossed
with
is
the currently
(White
18-21, 1955
Springs)
June 3, 1955
Demmler.
rights
Country Club of Mary¬
Investment Bankers Association
timely and urgent question of
proxy
the
at
As¬
Outing
land.
gations—the
ulation.
securities,
freedom of the market, and inten¬
(Baltimore, Md.)
situation ensuing from
still
issues
sifying its vulnerability to manip¬
tain
available supply of cer¬
Commodore
May 13, 1955
subject of a memo¬
this writer read into
the record by Staff Director Wal¬
lace
at
the
request of; Senator
Lehman
during the questioning
the
duce
Finan¬
™
at the
of
Societies
the
incited
re¬
Federation
Analysts
Hotel
question meriting but
no
Astoria.
1955 (New York Gity|
congruous
expression of the following fears:
continuously and increasingly
Chairman
no
Committee
the
refusing
moneys
have
of
was
ucating"
pen¬
or
there.
action
for
trac ed and listed on the New York
associations."
the formation of
\
m
_
Intro-
i^oJ" ji"! 79th" ^.8^„and
the 82nd Congress, it is still up
companies, savings
banks, commercial banks and
exchanges and securities deal¬
pleasure in announcing
at the
Sheraton
reporting,
solicitation and inside trad-
anniversary dinner
Astor Hotel.
kers
with 300 or more secu¬
holders and with $3 million
rity
Pennsylvania.
(New York City)
- .
. Bro¬
Association of Customers' -
some
philosophy of
Bill, which proposed
would
subject com-
University of
April 21, 1955
"Problem"
of
We take
; >»>*'
April 4-8,1955 (Philadelphia, Pa.)
Institute of Investment Banking
about the
due
proxy
Institutional
;
•
EVENTS
the
A variety of other pending questions germane to the Study called
for thorough exploration.
Among
strin¬
weighing the
seriously
',
1
,
scanty cognizance from the
Question
gency
in
the
"education,"
study ip many facets has been affording merely "a little knowledge
Committee.
been
for
reason
follow
to
problem
"government
constantly
cited by the Britishers concerned
with their Companies Act as the
of
Instead
corporate ownership from control,
lessening the supply of common
Also basic to a genuine inves¬
stocks.
tigation—in contrast to the pleas¬
(4) That their income tax ex¬
ant but superficial and uncoordi¬
nated discussion
that took place emptions may constitute inequity.
would have been a thorough
The Other Side of the Question
aims.
cupancy
manipulation.
however,
the market!
of
control ; assurodlyr ;: is. 7ultimately
bound
up
with that broad and
possibility of undis¬
closed abuses; that the SEC does
not
audit the accuracy of dis¬
,
industries, the welfare of
even the position
farmer and
the
or
continue
ers
of its affirma¬
Also, during the Chairman's
to
the best efforts of the Commission
the
confi¬
investors'
one
additions
complexity
of
restoration
for
which
perfectly
into the market place,
desires.
In
fact, the
so
no
either
the inherent
of the subject is one
out,
and
he
this
was
recommendations
have
free
go
—
the SEC's Chairman:
Act leaves the individual
to
departure
powers over
except* for the provision
margin requirement, did not
provide any check on the popu¬
to
of
automati¬
evert
unreliable infor¬
the
or
(1) That these large purchasers
con¬
subtraction from the Commission's
ex¬
legis¬
lation,
will
basic
or
"I
for
lar
this
statement by
directed
abuses.
the
deserving
at
possible fu¬
investigations—at least as a
ture
and
free
specific
against
.
along with
developed that
valuable at least in fixing the area
When the Commission's spokes¬
man
if
the Act;
at the outset would have been in¬
J
not
defense
pames
receipt of this official information
their
does
eliminate
studying the
.
legislation
convic¬
information
any
cally
mation
now
aware until the closing hours of
the hearings.
This question of j institutional
the
rises, which in¬
cited the Study, have not entailed
an
as
stamp
a
have accomplished little in pubne
the recent years'
almost
seemingly
The SEC is
size.
for
considered
witness
than
tue
ana
of government approval; and spe¬
or
enunciation
travention
rather
regulation,
to counteract the
sultant
achievable
of
Federal
effective prohibition on the
funds' exercise of control through
an
ec.ucaticn
have gained by having scheduled
the SEC's Chairman as the first
the
(b), as such vicarious items as automobile
pointed out, there pricing, monopoly, the profits of
this column has
discus¬
framework
Mis-Timing
Commission's
tion
of
Act of 1940, sec. 14
pany
in financial regulation. Un¬
fortunately the Fulbright doings
.
Demmler's
space,
present in¬
the basis for further
Congressional exploration would
quiry
as
by
programming would have been
the
opportunity to consider as
a
basic
assumption of the
entire
"Study's"
agenda, Mr.
authority only as a
prior protesting with¬
drawal of Irving Ben Cooper.)
direction
members
fortnight
Likewise
with adequate
As
the
on
skipping
and
ensuing
More
result of the
both
its
sion.
clear line of direction
a
by
Investiga¬
Market
1933 Mr. Pecora succeeded
getting
Committee
as
the
be recalled that at the start of the
eppchal
of
clarification
(In this connection it should
area.
attendance
sparse
they could have been con¬
structively used at the beginning
of the proceedings for essential
purpose and course of any
If price goes
result
process in the case of groups outside of the funds' area; of which
the
Senate Committee
was
un-
Mr.
press,
and
beclouded for the future the prop¬
er
by
in any event negated
part
them
accounts,
newspaper
explanations
was
well
Congress, left the lay. public
bewildered
basic
Demmler
inexpert
the
is
closure
(5) Self-regulation by national
tered
than
the cifically to make* it clear that dis¬
..
securities; exchanges
these
merits
seems
as
mention made of it
at the hearings' end is the chronic
misapprehension about the raison
irrepressible inference of
(4) The exercise of administra¬
tive and regulatory powers by,
being
which
greater ^ consideration
absurd.
questions of the restrictions on
a
changed short-selling
and
on
selective
demand-supply ratio in a free margin control as advocated by
market, that is fine! (During bear Mr. Eberstadt,
and on insi.'eimarkets, the complaint is always trading, Mr. Demmler refused to
about under-demand.)
render any opinion whatever; and
(4)
With
taxation,
including the Senators are not receiving
capital gains, payable by the ulti- any "education" elsewhere. Surely
mate recipients in the ordinary these situations, along with others
course, the tax favoring is not as cited above and by us in previous
marked as is often supposed.
articles, deserve as much ques(5) Under the Investment Com- tioning as that actually aired on
cursory
need
inal liabilities and penalties.
the
matter
a
ings,
up
d'etre of the SEC and the balance
requirement
hearings have
A.
Again
much
of
completely
real fact
laws
follows:
as
The
Building Commission;
fictitious;
securities
(3) Imposition of civil and crim¬
via
the Senate Of¬
f
Guarantee" Inference
(2) Prohibition of unlawful acts.
the sessions in
fice,
penultimate session
closure.
in¬
about
Nettlesome "Government
That
hearings'
which
on
of
one
—he very aptly classified the sev¬
eral underlying legislative policies
"educa¬
tional"
of
en¬
the
inspection
namely an exchange, the NASD,
State authority or the SEC.
Dangerous Thing"
a
Applauders of the results of the
and
with
By A. WILFRED MAY
5
(1497)
AMERICAN STOCK EXCHANGE
KANSAS CITY
(ASSOCIATE)
GRAND RAPIDS
DETROIT
_
MT.
CLEMENS
C
War II.
"Railroad Kernels"
t
*Jl
i
been poured into
railroad capitaliza¬
tion is only about $70,000 per mile,
while investment per mile is about
the
President, The Delaware and Hudson Company
have
property,
$145,000.
Enumerating "kernels of railroad progress," Mr. White
of
increase
(4) keeping increases in railroad rates below
of the
a
major railroad problems: (1) large part
dollar
revenue
(2)
paid in employment costs;
now
Freight
service deficits, and (3) legislative and regulatory
passenger
curbs which handicap competitive position
Fifteen
months ago I spoke in
optimistic vein about the rail¬
roads and I
still
am
optimistic.
respects I have
today to feel
many
In
more reason
of rails.
the average, move
day than they
cars, on
miles
12
more
per
did in
plies that I will speak rather gen¬
and try to convince you
erally
that my
the
optimism with respect to
railroads
is
without
not
Railroads
To
time—because
as
whole the
a
railroads
to
made
their
revenues
R.
William
White
dropped,
as
they did last
year—for some as low as 10% and
for some as high as 20%,
I do not
because
turn
to
mean
measured
it
not
was
imply that the
good
a
by
rate
good
a
in 1954,
year
of Re¬
but
year,
those individual railroads of which
I
have knowledge—and
quite
comprise
few
a
they
did
now
not
—
passenger business.
the
in
not
available
Measured
miles
senger
in
is about
and
25
as
and
much
freight
to
to
a
the
at
of mainte¬
I consider that to be
but
nance,
expense
perfectly legitimate, and especially
so
on
railroads
those
where
the
physical condition of the property
built up over a period of postwar
years made it possible.
If in some
cases
cut
maintenance
expenses
were
than
justified by the
physical condition of the property,
more
as
well
as
informed
mine, and usually there is
tain amount of impatience
an
as
we
volume
in 1926,
was
from
ranges
the ratio of rail¬
production
has declined.
Now to get
back to
railroads have made
of
What
years.
enumerate
progress
over
is
a
the
period
Let
it?
me
briefly.
(1)
Big reduction in debt and
charges. Since 1929 funded
debt, not including equipment ob¬
ligations, has decreased from a
little
more
than
$9.5
billion
to
billion,
lion
and fixed charges
clown from $680.5 mil¬
about
to
$405
million
Fixed charges today
year.
per
are
at
level that could be covered with
a
part of one's host to find out what
something to spare by even the
low earnings of 1932.
(2) At about the time of World
the
War I railroad
subject of
go^ng
pressed
I
said
road
a
a
cer¬
the
on
speaker's talk is
to be.
So, having been
somewhat in this regard,
I
would
talk
about
Kernels"
because
address
Mr. White
"Rail¬
that
im-
about
to
New
York
by
Association
City,
March
of
25,
before
New
12%
1955.
mileage had grown
point of ex¬
While
there has
decrease in
since
been
a
railroad mileage
then, investment in property
increased
the
York,
(and that
increase from
an
of
course,
all
means
railroad
em¬
find that in 1929
there were 269,000 ton miles han¬
dled per employee and over 500,We
000 in 1954.
is another
here
And
factor.
ing
did
they
1953
In
handled 36%
more
in
illuminat¬
the
railroads
ton miles than
did
1929 and
it with
some
70%
and
a
large proportion of that in¬
very
they
vestment has occurred since World
they did in 1929 and
with 18,000 ,(34%)
did
it
fewer passenger cars.
(4) Wages have increased in the
period
postwar
about
and
125%,
although freight rate increases ag¬
gregating about 80% have been
authorized
since
the
subse¬
war,
quent adjustments and hold-downs
various
on
revenue
commodities
mile having ad¬
ton
per
in
result
vanced only 47%, making railroad
freight
transportation one of the
cheapest things that can be bought
in
this country
in
price is compared with the in¬
when the increase
in' prices
creases
of
(5)
be¬
businessmen
by
is
outlook
business
what
think
you
make
ticularly non-farm prices—repre¬
senting largely semimanufactured
im¬
business
little
tories
espe¬
Ira
T.
E.Iis
day because
are
we
tories
oper¬
to
STOCK &
BROKERAGE SERVICE
communications, better track
improved maintenance
and
mechanization.
American
just
are
that
prove
dynamic
as
rail¬
other
as
industry.
emphasis
greater
research
better
no
for
and
continuing
better
equipment,
least,
means
techniques,
better
service,
better safety, and more profit, and
all
the
at
the
lowest
possible
to
cost
public.
must
be
improvement
under the
are
not rail¬
We dare not look
rose-colored
glasses;
clear.
in
our
Despite the
efficiency
industry
To
problems
Without
and
railroads
some
are
which
in
vary¬
the
extent
inter-related.
attempting to enumerate
I
would
simply
say
that
pay
dollar that is required
employment
costs,
and
to
that
but
also
such
so-called
fringe
New York 4
vacations, health
and welfare insurance, unemploy¬
Teletype NY 1-733
ment insurance and so-called pen¬
as
alty payments under
LANE
SOUTHAMPTON, L. I., N. Y.
ments that
to
as
are
wage agree¬
sometimes referred
and
produced in the country
only 2%. The prin¬
consumer
are
spending,
total;
the
of
66%
about
govern¬
purchases, about 22%; and
12%.
Consumer
ment
investment,
of
construction
the
of investment, and
made
local
and
state
por¬
purchases
governments
highs in 1954, in both
new
dollars and
in
physical terms, re¬
flecting the shift in demand from
war materials
toward peace-time
decline
The
1954 occurred
deficit
resulting
Continued
was
strong sup¬
a
throughout
construction
ditures for the year are
at
a
billion, up 5% from 1953
high. Residential con¬
and highway construc¬
$37
to
expen¬
estimated
new
struction
tion
were
tion
were
and
and
down
school construc¬
In
20 %.
up
industrial
were
Commercial
12%.
up
construction
contrast,
construction
farm
10%.
-v
activity rose signifi¬
cantly in the last quarter of 1954,
Business
based
principally
model
the
on
change in automoblies, continuing
strength in construction, im¬
on
from
page
24
less
and
inventory
de¬
Weekly output of steel
30% between August
about
and
December,
reduced
1953
of
defense
of
invest¬
the third quarter
and the fourth quarter of
Federal
1954,
expenditures
for
annual
rate
from
fell
an
$52 billion to $41 billion.
ing
and
expenditures
inventory
Between
third
the
of
quarter
inventories
—
Dur¬
1953,
manufac¬
turing, wholesaling, and retailing
at an annual late of $2.0
—rose
billion,
of
1954
of
also
small
$4.8
the
third
quarter
at an annual
billion. There were
they
rate
of
in
but
fell
declines
automobiles and
in
the
using
non-
holiday weeks in December.' Au¬
tomobile production was
ing
September
of
because
result,
model
new
dealers'
October
at
were
with
production
1952
steel
at
and
October
truck
of
interfered
September
in
level
the
half
about
a
in
end
lowest point
the
strike
the
of
the
at
since
As
changes.
inventories
car
hands
low dur¬
October
and
Automobile and
1953.
production
sharply
rose
from
57,000 in the third week of
October to
174,000 in the third
week of December.
month
each
rose
through
these
year
Housing starts
from
May
December, and each of
was highest for the
months
up
that
to
seasonally
time,
adjusted.
In
short, the year 1954 was a
of readjustment from war,
year
preparation for war, toward
conditions,
with
de¬
peacetime
1953
principally because
defense
reduced
ment.
f
between
purchases
other durable
fense
high
spending remaining at a
level.
Federal cash spend¬
ing, as distinguished from budget
expenditures, during the calendar
year
1954 was reduced $6.5 bil¬
Federal
lion below the 1953 total.
cash
receipts
were
reduced
the
year,
tax
revision
the
from
public
only $1.5 billion in
since full effect of the
be felt until
bill
in
1954
will not
Private spend¬
1955.
ing for consumption and for con¬
struction increased in
1954, as did
spending by state and local gov¬
ernments—largely for schools and
roads. The year 1953 ended with
business declining.
ended
with
The
year
1954
business?- rising.
goods bought by consumers, part¬
ly
because
Business
of
income
expenditures
declines.
for
plant
"featherbedding."
The
rela¬
proper
economy
Total
1954.
or
goods and services.
by Mr. Ellis before the
Synthetic
Organic
Chemical
Manufac¬
turers
Assoc:ation,
New
York
City,
*An
(2)
Product—
goods
the
all
of
down
business
(1) The large percentage of the
revenue
industrial
on
National
Gross
country
and
the
based
cipal outlets for production in the
confront
benefits
*
averaged about 7%
1953,
—was
of
taxes,
•
activity
business
The
1954
value
the
and
includes not only wages and wage
MEETINGHOUSE
1955, let us take a quick
year
1954 for back¬
for
below
service that has taken place, there
are still three major problems that
various
the
quarters.
the
at
look
tion
problems.
Construction
port in
rose
presenting estimates for
spending,
Stock Exchange
30 Broad St.
1954 Background
The
services
(6) Last and by
into
cline than had occurred in recent
terms.
roads
them
tion with the reduced rate of sale.
retailer,
erally,
they
to run off
permitted
were
bring
proved demand for textiles at all
levels from manufacturer through
national security largely
increased imoorof government since 1939.
for
ing
production—the output of manu¬
facturing and mining in physical
but
the year, but the
orderly.
Inven¬
was
accounts for the
These are, of course, all things that
have happened in industry gen¬
Stock
Exchange
of
goods and services in the country.
In
1939,
incidentally, thev ab¬
sorbed around one-seventh. Spend¬
rate
they are:
Members
than
one-quarter of the total output
ground.
the
them in the order of their impor¬
York
less
absorb
still
ernment
structure,
practices,
tance,
New
government
and
three
Members
large growth in
activities over the
past 15 years, all levels of gov¬
relatively
the
the year
with
compared
ing degrees.
Hardy & Co.
is still high, it is
sharply lower than it was in 1952,
or
1953, or 1954. Business stimu¬
lation today depends even more
on private spending by individuals
and
businessmen than has been
true for several years. In spite of
ing for defense
larger
and
better
locomotive,
freight cars, improved signaling
affect
for Banks, Brokers and Dealers
a
Before
vision
BOND
in
around
reduced
were
reduction
in¬
inven¬
business
Total
during
4.4%
cially true to¬
of
liquidation
distress
ventories.
This state¬
is
was
to
con¬
fidence.
ment
1953
only 0.3% from December
December
1954.
There
outlook is
ness
goods — re¬
They rose
in 1954.
mained steady
busi¬
the
manufactured
and
portant factor
in
hump.
the
over
employment in the coun¬
in 1954 averaged about 61.2
million, down about 1.0 million,
or
1.6%, from 1953. Prices, par¬
of saying
probably
most
after Korea—the defense pro¬
up
try
it.
That is another
the
reduced
were
tig industrial build¬
the
because
Total
what
be
you
equipment
6% from 1953 to 1954, partly
some
gram—was
you
will
that
there will
in 1955."
men
and
Business
do.
steam
Diesel
through
what
and
railroading too numerous to men¬
tion, such as the economy of the
road
&
the
cause
pleasure to talk
a
of
determined
Improvements in the art of
impression that there
ST.
always
groups
of work for credit
tance
commodities
services generally.
I would not leave you
MAIN
is
ating
Three Major Railroad Problems
Telephone DIgby 4-7800
It
with
as a year
spite of expected improved business activity,
be plenty
way
have
transportation,
but
miles per employee
ton
ployees).
its greatest
pansion.
has
*An
Investment
take
of
hour,
train
per
been
with
do
to
let's
figures
important
miles
has
and
fixed
have gone
audience
it
road traffic to national
be paid.
to decide what to talk about to
miles,
volume by rail
greater, but in the in¬
the
economy
has
grown
$6.5
problem
ton
pas¬
40%
the "piper" will of course have to
It is always a difficult
of
terms
find that passenger
terim
duced
peacetime
traffic volume is smaller than be¬
fore.
much faster and
impairment in work¬
quick assets. True,
large extent were re¬
in terminals
an
business, it does
that railroad
mean
ing capital
costs
only
of all interstate freight
suffer much
nor
all
ton
even
now
the
"in
1954
conditions, with defense
world nominally at
ownership of about 22% fewer
In
this connection it must be
peace. There is no organized war¬
freight cars. They handled slightly
borne in mind that although these
fare
going on anywhere in the
more
revenue
passenger miles in
world.
Although Federal spend¬
figures indicate a relative decline 1953 than
state
when
railroads had
progress,
handle
and about one-half the paid inter¬
operating ef¬
ficiency
they
about 50%
their
improve
considerable
though
and
expenses
despite the
competitive
of
of transportation and cer¬
handicaps resulting from in¬
ability to compete on a fair and
equal basis,, the railroads have
their
reduce
of
period
a
that,
growth
tain
■demonstrating
the
in
25,000 to 52,000.
These figures,
Progress
forms
pretty good
job in 1954 in
ability
over
find
we
constant
a
an
back
go
years,
did
Made
of
because
amount of time spent
there
Have
slowly
and in loading and unloading. And
gross
justification.
that
at
1929, even though they still
too
its
•optimistic
than
toward peacetime
tons in
move
an
of readjustmenfc from war
spending still at a
high level, Mr. Ellis sees 1955 as a continuation of business
improvement from the low level of 1953. Estimates industrial
and mining output in 1955 at 5% better than last year, but
looks for "some hesitation in the second half."
Concludes,
After characterizing
1,300
net
tons,
1929. In the
same
period the average freight
train speed has increased from 13
to 18 miles an hour, and that takes
in
all
kinds
of
freight
trains.
continuing research for better operating
as
(6)
Cites
techniques.
in
handles
today
against 800
(5) vast improvements in equipment, particularly in Diesel
engines, and
By IRA T. ELLIS*
there is none in rail¬
capitalization now.
(3) Large gains in efficiency
factors. Tne average freight train
increases;
wage
1955
Thursday, March 31,
.
Port de Nemours & Company
E. I. du
road
(3) gains in railroad efficiency;
70% since World War II;
"water"
about
true
.
whatever may
that
So
been
.
A Look Back and Ahead for Busine ss
the old days,
in
in
investment
have
men¬
debt and fixed charges; (2)
railroad property by as much as
big reduction
(1)
notwithstanding large
But
that
sums
By WILLIAM WHITE*
tions:
Chronicle
The Commercial and Financial
;i
(1498)
March
address
9,
1955.
High Level of Business Activity
In
Europe
Incidentally, a very high level
of business activity also currently
Continued
k
on
page
22
Volume 181
Number 5416
.
(1499)
The Commercial and Financial Chronicle
.
.
10 years ending in 1954,
obtain average earnings,
The Stock Mavket Situation
(a registered investment company)
our
Adjunct Professor of Finance,
ness
Graduate School of Business, Columbia University
is
they look, nevertheless
criteria the
the
reason
for the market rise since
would
break
As¬
There
capital gains tax cannot be foretold, suggests Presi¬
dent might be given power to
make changes in effective rate,
specified limits.
within
This statement will address itself
^n^ri^-.to-tlftee^points^-
Industrials
Dow-Jones
The
...
(B)
and
between- price-
value.
the
rise in
Feasible, methods
t
1937 and 194-3%The same applies to*
General Electric as an individual
.
of the
Causes
market since September 195$,
trolling -«»eessive
of
con-
(A)
Common
stocks
to
.....
The Present Level of
not
hAdh
as
♦hi*, JL
market
level ■'
"
shownby the Standas
ard
&
index
Poor's
as
comnared
Benjamin Graham
^929
wjjXft
The Dow-Jones Industrials Average at about 410 is
high of 195.)
only moderately above its
high of 382, but the difference would be much larger exnow
1929
cept for the substitutions made
in
the railwhole
well below their 1929 highs.
However,
Average.
road and utility issues as a
are
The
true
of
measure
common
of course, is not
found by reference to price movements alone, but by price in relation to earnings, dividends, future
stocks
values,
prospects and, to a small extent,
values.
asset
concepts
Present
turn
valuation
stock
estimating
rate
average
of common
largely on
future
earn-
dividends and applying
ings and
thereto
.
.
,
_
suitable
a
capitalization
multiplier.
or
all
these.
Since
matters of
elements
are
diction
judgment, there is room
for
or
opinion
a
pre-
wide difference of informed
a
as
to the proper value lor
single stock or group of stocks
at any time.
■illative
cover
Uninformea_or .specwill,
opinion
market swings.from
the depth of
the heights of op-
to
pessimism
timism.
present
the
level
made
sets
two
relating
sons—one
Jones
past
of
light
have
to identifying the
of stock prices in
experience, I
guide
a
.
^
^
As
course,
wider ranSe asthe
even
an
of
Industrial
other to General
the
Electric,
a
the
com-
1946
prices in 1929, 1937
the high
and
earnings of the pre-
to
ceding year, the preceding five
and the preceding 10 years,
This
information, together with
years
certain other data, appears on
appended
*Mr.
ings
the
u.
on
the
Graham's
the
s. Senate,
statement at
Stock
on
Market
the Hear-
Study
; ;
of these Shares having been
these
of
before
Our
approach, cab say
third
sold, this advertisement appears as-a matter
of record only.
March 25, 1955
Amerada Petroleum
,
Common
*'
Corporation
Stock
(No Par Value)
d
made
in higher.
•
>
-
20,000 Shares
•-
Barber Oil
Corporation
Capital Stock
($10 Par Value)
I have found it useful to estimate the "Central Value" of the
Dow-Jones Industrial Average by
the simple method of capitalizing
10-year average earnings at twice
the interest rate for high-grade
31,000 Shares
bonds This technique presupposes
tbat the average past earnings of
The Dow Chemical
stocks presents a fair
basls u£of estimating future earninSs'bu£ WItb a conservative bias
,tha lo™ s'f.e- 1 aIs0 assumes
hat by doubling the capitalize-
Company
a &r°uP
Common
Stock
($5 Par Value)
tion rate presented by high-grade
bonc|S) we an0w properly for the
differential
in
imputed risk beand good stocks,
fween good bonds
this method is ooen
theoretical objections,
Although
serjous
£acj.
jias
gjven
a
reflection
curate
reasonably
of
the
to
7,000 Shares
it
ac-
Central
yajue 0f industrial common stock
The Louisiana Land and
since 1881. It may be
interesting to note that the Cen-
Exploration Company
aVerages
ya]ue
found
Common Stock
this method
jn ^29 was 120, which happens to
akout the geometric mean between
the high of 381 and the
^raj
subsequent
the
jarly,
by
($1 Par Value)
1932 low of 41. SimiCentral
in
Value
1936
138 (higher than in 1937) and
was
this proved to be about the mean
29,400 Shares
between the 1937 hmh of 194 and
the low of 99 in 1938.
Olin Mathieson Chemical
A Reassuring Measure
This mechanical method applied
to the situation in the beginning
yields
Common
Central Value
for the Dow-Jones Industrials of
of
1955
Corporation
Stock
($5 Par Value)
a
only slightly under their
present value. Such a figure, if
reliable, would have to be re¬
396. or
garded as rather reassuring.
It
would indicate that the market
in
of
than it
is no higher
in early 1926, or
value
terms
now
was
6Ver,
Value
How-
the Validity Of thlS Central
figure
may
be
Open
to
Banking and Currency,
March ii, 1955.
Continued Oil page 22
....
for 1946.
in early 193-3. or late 1945.
table.
Committee
the subject, I am inclined to as to future developments, sup-
However,
over-all conclusion through guesses and
the market had entered dangerous
S.round at a Pomt far below that
Hgure*
Dow-
Average,
little
*s helpful. We
think he .has a fifty-fifty chance
prices.
my
27,000 Shares
of compari¬
to
ponent of that Average and an
outstanding "blue chip" issue. I
have
related
the present prices
and
A"
question if we observe that the
//
as
projections
stock
>
Past hull market highs. Since the
Dow-Jones Average lost 90% of
Hs price from 1929 to 1932, it is
evident not only that 381 was
much tOO high in 1929, but that
present
figure
is
(The
300
ratios
^abe i'nto account the extent
the subsequent declines from.
Industrials.
above
be
relationships as indicating that the
market-as still on safe ground,
However, such comparisons fail
t°
420
of
1
has 'been
Much
stock-investor"
reduces his stock holdings when
the market enters the speculative
phase of a sustained advance. ,
"This speculative stage, we areconvinced, is now at hand. Hencev
the principles of the prudent investor will require him to lighter*,
significantly his holdings of cornmon stocks — the precise selling
NOT NEW ISSUES
each dollar of dividends or earn-
above the 1929
high
the
not
'prudent
who (a) buys only at prices
amply supported by underlying
value, and (b) who determinedly
one
.
basic
-
ings.
far
is
stock
some
All
way
interest rates presumably justify a higher value for
Lower
Industrials
of
am
their former tops. It
markets except
bul1
as
Thn
i
I
its possibility, or historial approach, the market
reason
for con- appears distinctly on the high
the
».
high-grade interest rates are now
definitely lower than in previous
hut
irp'
thev
past,
deny
issues
the
considerable
reaching
to
development
revolutionary
f,ho"ld bf P°(inted ou£ als0 that
and
high
Utah
nrp
a
before
go
shown at
£tock Prices
look
•M
that
tive of the larger Industrials as a
whole—have
-
•
K*4s *dear
stock.
if
j
''referred to—which may " be con-sidered as reasonably representa-^
in
speculation
the future.
the
oL
are
$g,<?
prices
relationship
is
a
a
the
with
at a lower m ratio to their 'teaching
; -now
such
depressions will
Contends that net result of possible aboli¬
stocks.
common
tion of
today
who seeks to profit from
market movements, without primary regard to intrinsic values;
one
serious side and vulnerable to a substanpreV«*hted, ;if tial .setback.
Contrariwise, our
not: by
thd natural vitality of second category—that of appraisal
American business, then by gov- based on figures and formula—
ernmental intervention and pos— about .supports the present level, policy to
depend
of course
on
sible
inflationary
moves.
The and 'suggests that the familiar. f
above analysis is
by no means bull
market enthusiasm might • ^1S individual position and meth.unfavorable to the present level well
carry
prices considerably ods- For the stock speculator we
opportunities rather than risks
in
high
too
eluding that in the future
doubt to confidence, with pub¬
lic's emphasis concentrated
that the
fair to say
not
really
involve
prepared
Septem¬
recent
managed to lick
business cycle.
have
Although
as
ber 1953, was the swing from
on
is
of
the future as
past. It
in
the
in
probably
v/e
the basis of various quantitative
on
prudent investor should lighten his holdings.
the fundamental
serts
high
as
Oct. 18, 1945.) I should like to
quote intact the Summary appearing at the end of that article
and state that it expresses my
view with respect to the stock
market today.
"The three different approaches
used in judging the present level
of stock prices have yielded diverse indications. From the first,
depression
market
relationship between price and value, and causes of the
market's rise; and suggests methods of controlling excessive
on
not
ability to escape serious busi-
period
any
have
we
Mr. Graham analyses the present level of stock prices based
are
of the stock market in October,
1954, at a time when the Dow-
definite verdict,
"What is the net significance of
pression.
In a sense, therefore, Jones Average stood at 185. (This this analysis for the speculator
the soundness of this appraisal of was published in "The Commer- and the prudent stock investor?
Central Value is bound up with cial
and
Financial
Chronicle," Let us define the speculator as
By BENJAMIN GRAHAM*
Maintains that while stocks
hark back to the analysis I made plies plenty of material but no
did not
real de-
include
Chairman of Graham-Newman Corporation
speculation.
used to
7
Merrill
Lynch, Pierce, Fenner & Beane
The Commercial and
(1500)
8
Celotex
randum
Central
New
4, N. Y.
York
Purcell
A.
Corp.—Memorandum—Edward
Broadway,
Financial Chronicle
&
Co., 50
Fruehauf Trailer Co*
on
Fibre
of
Smith,
Products
Co.—Analysis—Cohu
Co.,
&
Co.,
&
14
1
Investigation Took
Wall
Wrong Track
188)—
New York 5, N. Y.
on Reading Company
Wall Street,
bulletin
a
Great Northern
(No.
Company—Bulletin
Railway
Georgia
Barney
Also available is
vs.
(No. 189 j
April
& Co.,
^
the
.
Inc., Union Commerce Building, Cleveland 14, Ohio.
ties
of the Canadian {securi¬
review
:*
bulletin
data
are
on
Co.—E.
Hutton
F.
&
Company, 61 Broadway, New York 6,
current issue
In
Though
curities
Co.,
Stock
Japanese
the
dent
Market—
rities Co., Ltd., Ill Broadway,
and
New York 7, N. Y.
Progress—
City of New York, Pine Street
York 15, N. Y.
Over-the-Counter Index—Folder showing an
over-the-counter industrial stocks
used in the National Quotation Bureau Averages, both as to
yield and market performance over a 13-year period —■
National
Quotation Bureau, Inc., 46 :Front Street, New
Homes
PF—The
forecast for
Industry
—
reprinted
1955
of Prefabrication—United- Capital
Magazine
Clients"
Our
stockholder
relations
—
Review of
solicitation and
proxy
activities—Georgeson &
Co., 52 Wall
Milwaukee
Industry in Japan—Analysis in "Monthly Stock
Digest"
Securities Co., Ltd., 1-1 chome, NihonbashLTori,
Tokyo, Japan and 61 Broadway, New York 6,
—Nomura
Chuo-ku,
Oil
Olin
"What
the
—
Analysis
—
differences.
Wall Street,
ferences
Service
of
North
115
basically,
in scope
vestors,
Southern
Natural
Ginger Ale, Anheuser Busch and Pabst Brewing—Thomson
Southern
&
American
Gas
able is
report
a
White's Auto Stores, Inc.'
on
What Atomic Energy
with
Also avail¬
Southern
a
&
Is and How It Is Applied—4-color sheet
listing of 100 atomic stocks—Atomic Development Se¬
Co., 1033 Thirtieth Street, N. W., Washington 7,
DC.
*
#
60
Fidelity
American
&
Co. Incorporated, 44
American
Machine
Casualty
Company—Analysis—Blair
Wall Street, New York 5, N. Y.
&
Foundry
/. merican Machine & Foundry
New York
Ohio
—
Basic
Co., Inc., 14 Wall Street, New York 5, N. Y.
Refractories,
Pine
Inc.—Analysis—Stanley Heller
Street, New York 5, N. Y.
Beneficial
Loan
&
Co.,
30
Corporation—Annual report—Beneficial Loan
SECURITY TRADERS ASSOCIATION
Corporation,
Bonanza
&
Oil
&
Mine—Report—L.
Bowater Paper
17 Wall
randa
Friedman
.
.
<
Co.,
Inc.,
;
1.
5.
6.
8.
10.
12.
Inc.—Bulletin—Leason
&
rn
200
Orders
invited
•
Public
Utility
•
POINT CLUB
WILBUR KRISAM 215
"
of
Points
Co.,
Inc., 39 South La Salle Street, Chicago 3, 111.
W" mnbe aood market*
these
"Underlying
factors,
ap¬
parently, is an increasing aware¬
ness that we are living in an age
OF NEW YORK
phenomenal scientific and in¬
progress.
A mere listing
new industries and products
that
31
Ucrtmrot §>ea«Aties
(Co.,XtcX.
Member
Natural Gas and
5
POINT
taking part in this new
revolution
would
be
tiresomely long. Electronics, plas¬
28
24
tics, synthetic fibers, petro-chemi-
20
cals,
20
transport, air conditioning, quick-
19
metallurgical
frozen
15
dieseliza-
puters, nuclear science—these and
14
14
13
railroad
foods,
air
advances,
tion, automation, electronic com¬
14
many
,
CLUB
CHARLIE KAISER
are
industrial
28
_
11.
Mines,
and
eliminate
govern¬
competition with private
business.
KleinpRappa, Farrell, Voccolli, Strauss, Cohen
Donadio, Hunter, Fredericks, Demaye, Saijas, Kelly____
Mewing, Define, Gavin, Montanye, Bradley, Huff___^__
Growney, Alexander, Eiger, Valentine, Burian, Craig____
Meyer, Murphy, Frankel, Swenson, Dawson-Smith, Kuehner
Leone, Nieman, O'Mara, Forbes, Greenberg, Murphy_______
Krisam, Clemence, Gronick Stevenson, Weissman, McCloud
Bean, Meyer, Bies, Pollack, Bernhardt, Weiler
Kaiser, Hunt, Werkmeister, Kullman, McGovan, O'Connor.
Manson, Jacobs, Siegel, Topol, Frankel, Tisch______
Barker, Brown, Corby, Weseman, Whiting, Fitzpatrick_____
Serlen, Rogers, Krumholz, Wechsler, Gersten, Gold
3.
Collins Radio Co., Consolidated Television & Radio
Quicksilver
earnest effort to follow
policies, remedy tax
fiscal
of the
Broadcasters, Inc. and Jack & Ileintz, Inc.
California
attitudes toward
friendly and
more
are
an
sound
Team
memo¬
are
reassured
dustrial
9.
Also available
ing
Co.,
Security Traders Association of New York (STANY) Bowling
as of March 24, 1955, are as follows:
7.
Corp.—Memorandum—Kidder, Peabody & Co.,
Street, New York 5, N. Y.
on
D.
been
that Federal authorities are mak¬
&
League standing
4.
Bird & Son, Inc.—Analysis—New York Hanseatic
120 Broadway, New York 5, N. Y.
52 Broadway, New York 4, N. Y.
Hentz
NSTA Notes
2.
Corporation, Beneficial Budding, Wilmington, Del.
have
sympathetic than they were dur¬
ing the earlier postwar years—
Ira
—
abuses,
Cc., 14 Wall Street, New York 5, N. Y.
Bankers Trust Co.-Public National Bank & Trust Co.—Memo¬
randum— Blyth &
business
mental
Shearson, Hamrnill
the last few months.
in
must
governmental
Oil
by the
by the developing realization that
Inc.—Analysis—Glore, Forgan
Co.—Analysis—H.
Street, New York 5, N. Y.
&
Company—Progress report—
Company, 261 Madison Ave.,
Railroad—Analysis
Associated
Beaver
16, N. Y.
Baltimore and
&
Water
the
at
business
encouraged
and
recovery
They
Co., 40 Wall Street, New York 5, N. Y.
Electric Service Company — Analysis
Haupt & Co., Ill Broadway, New York 6, N. Y.
Tide
•
Investors
relieved
1953-54
the
of
recession
more.
been
unexpectedly prompt and vigorous
Corp.
Southwestern
curities
in¬
worth
are
mildness
report—Secretary,
Company, Watts Building, Birming¬
Production Company,
in¬
of
willingness to pay more
ownership in Amer¬
a
have
must
Company—Annual
Gas
an
confidence
ican business in the belief that the
shares
ham, Ala.
McKinnon, 11 Wall Street, New York 5, N. Y.
Natural
primarily to
the
for shares of
Carolina—Memorandum—Harri¬
Transportation
that,
that of recent months
as
in
crease
contends
price advance so broad
a
"must be due
Corp.,
General
on
two
editorial
The
Ltd.—Study—J. R. Williston & Co.,
Broadway, New York 6, N. Y. Also available is a bul¬
letin
hopeless than
a parallel
periods."
more
the
between
report—Offices
Chemical Cor¬
favor
situation, but they
attempt to establish
an
Co., 123 South Broad Street, Philadelphia 9, Pa.
Lithium
Quebec
New York.
Co.
necessarily in
are
ing could be
&
West Virginia Railway
Company—Bulletin—
Bregman, Cummings & Co., 100 Broadway, New York 5, N. Y.
&
are many significant
Not all of these dif¬
differences nonetheless. Noth¬
are
Pittsburgh
son
re¬
preceding
against these
.
Scherck, Richter
Assistant
have
different from that in 1929
years.
There are
some superficial and mostly acci¬
dental similarities, but over
g
.
Corporation
Secretary, Olin Mathieson
poration, 12 Light Street, Baltimore 3, Md.
Public
hearings
very
and
Co., 225 East Mason St.,
Olin Mathieson Chemical Corporation—Annual
of
the
it.
the editorial states, "is
that the present situation, both in
and out of the stock market, is
Company, 320 North Fourth Street, St. Louis 2, Mo.
Summer
Refreshers—Analysis of beverage industry with par¬
ticular
reference
to
Coco-Cola, Pepsi-Cola, Canada, Dry
2, Wis.
Gas
&
'too
vealed,"
—
Oilgear Company—Report—Loewi &
Street, New York 5, N. Y.
Steel
the best means of preserving
Report — General Investing Corp.,
Street, New York 5, N. Y.
Wall
30
Company, 129 North Virginia, Reno, Nev.
"Report to
Co., 36
is
profitable
reasons for
more
the
into
question
market
business confidence and
of the present
Mid Continent Uranium
York 4, N. Y.
from
&
inquire
increased
New York 5, N. Y.
up-to-date com¬
parison between the listed industrial stocks used in the Dow-
to
McDermott
P.
Beaunit Mills.
Co.—Memorandum—Bache
stock
high,' it would be
Inc., Alamo National Building, San Antonio 5, Texas.
pany,
the
whether
Sylvania Electric Products,. Inc.
Magnavox
unanswerable
the
Longhorn Portland Cement Company—Analysis—Russ & Com¬
Jones Averages and the 35
Prefabricated
pointed out that "instead of asking 5
Copper Corporation — Survey — Abraham & Co.,
Broadway, New York 5, N. Y. Also in the same bulletin
brief surveys of Outboard Marine & Manufacturing Co.
are
of the
Bank
of Nassau, New
monthly publication of the Guar¬
Broadway, New York 5, N. Y. Also in the same bulletin
data on Allegheny Liidlum Steel Corporation, Montana-
120
Highlights—Petroleum
Business
Chase National
corner
Hubbell Incorporated—Bulletin—Peter
prices, the April
Guaranty Survey,"
anty Trust Company of New York,
Securities
memorandum—Aetna
market
"The
of
issue
Kennecott
York 5, N. Y.
Investment Opportunities in Japan—Circular—Yamaichi Secu¬
American
Limited—Card
Dakota Utilities Co. and
14 Wall Street, New
hearings before the Senate
stock
on
Co., 44 Wall Street, New York 5, N. Y.
120
of preserving it.
means
editorial discussion of the
an
Banking and Currency Committee
Inspiration Consolidated Copper Co.—Data—Sutro Bros. & Co.,
Chuc-ku, Tokyo, Japan.
Latin
Bell
In
*
recent
National Bank Building,
2, Colo.
reports—Equitable Life Assurance Society of the United
Harvey
are
Investing in the Electronic Age—brochure—Harris, Upham &
Co.,
:
Corporation, 111 Broadway, New York 6, N. Y.
Nihonbashi
Kabuto-chuo,
1-chome,
6,
and best
memorandum—
Industries, Inc.—Bulletin—de Witt Conklin Organiza¬
Graham
of "Weekly Stock Bulletin—The Nikko Se¬
Ltd.,
Mosle & Co.,
Equitable Life Assurance Society of the United States—Presi¬
&
Investments
First
more
reasons
for increased business confidence
Corporation—Card
Co., Inc.,
it would be
says
profitable to inquire into
tion, JLOO Broadway, New York 5, N. Y.
New York.
Foreign
Meeds,
States, 393 Seventh Avenue, New York 1, N. Y.
particular reference to
Co., Inc., Merck & Co., and Parke, Davis &
&
&
Eastern
& Co., Inc.,
Stocks—Analysis—with
Pfizer
&
Building, Houston 2, Texas.
Oil
&
Denver
Slreet, St. Louis 2, Mo.
Drug
Chas.
Also avail-
:•,J
Shares—Brochure—Slayton
Equipment
Olive
408
Street,
Minnesota & Ontario Paper,
Wilson,• and Clevite. ■\:
Electrical
Ethical
King
50
Uranium
Brereton, Rice
Ltd.,
Co., 52 Wall Street, New York 5, N. Y.
same
of Commerce
Dallas
Stores—Brief analysis of outlook—Bruns, N'orde-
Department
&
Bissell
Guaranty Trust Company of
New York,
Broadway, New York 5, N. Y.
Bank
1948-1954—Bulletin—
Yields
(Canadian)
Bond
McLeod, Young, Weir & Company,
West, Toronto, Ont., Canada.
inan
Co.—Bulletin—Laird,
Colorado Oil & Gas Corp.—Memorandum—Rotan,
Comparative
;
120
Market—Newling & Co., 21 West 44th Street, New York
36, N. Y.
in the
Securities
Christiana
Guaranty
"The
of
issue
Survey," monthly publication of
Railway.
Chesapeake Industries, Inc.—Analysis—Gottron-Russell
Canadian Letter—Fortnightly
other
analysis
'
DEPENDABLE MARKETS
items add
up
to an
industrial outlook that defies close
but
is
potentially
bril¬
liant."
Bonanza Oil & Mine
Producing Quicksilver Mine
,
N-A.S.D
Broker and Dealer
Trading Markets Maintained
•
Industrial
Stocks
Material and Consultation
on
.
2-
2400
Members: N. Y. Security Dealers Association
74
Trinity Place, New York 6, N. Y.
with ont
1,
376
61
Broad way,
on
request
Tel.:
obligation
L.D. FRIEDMAN & CO. Inc.
New York 0, N. Y.
BOwlinjr
Green 9-0187
Head Office Tokyo
I
Report
Japanese Stocks, and Bonds
Truster, Singer & Co.
IIA
+
Fulbright Market
Also available is a memo¬
Street, New York 5, N. Y.
Central
Thursday, March 31, 1955
...
DEMPSEY TEGELER & CO.
52 Broadway* Mew York
'
City 4, N. ,Y«-
Telephone Dlfby '4-0860- *-i<'
•
V
;■
Volume
181
Number 5416
.
The Commercial and Financial Chronicle
.
.
(1501)
mum
From Boom to Doom?
contributing to Wall Street's present enthusiasm
people.
i
The government shares
taxes.
All
do is look be¬
Forget the valleys,
have
you
to
yond the drop.
over
think of the hills."
stocks, tips, popularity of "blue chip" and "growth"
stocks, and to the entry into market of irrational buyers. Sees
To this is added:
penny
"The
deficit.
Concludes
program.
biggest market danger is from our imaginations.
on
securities be amortized; and capital
too
Recommends loans
We
have
So,
is running a
big defense
a
need to own
you
stocks
as
I
don't
want
hedge against
a
I
don't
didn't
complimented
committee should ask
views
my
stock
that this
mi11e
To
this
to
state
of
state
the
the
me,
fact
com-
is
e
holding
a
prices held in a narrow range.
Speculators and investors didn't
trust prosperity.
It wouldn't last.
Then, when the 1949 recession
didn't gather momentum,
inves¬
and
tors
catch up
to
ma¬
between
1955
Korean
and 1929.
This
flashed
time,
studying
might
the
market before
good
only
insurance
against
Clash.
the
to
excesses
the
in
members
of
'20s,
which
and
went
we
the
economic
One
of
the
But
revaluation
revaluation
was
of
stock
taking
into
rather
when
another
came
the
1953
recession
way.
decline
the
stock
in
prices
commodity
after
the
Great
1929
World
and
War
I
crash.
and
Depression
after
with
II
chosis."
just
"depression
a
Depression
the
contrast
recovery
psy¬
always
was
What a
to the early '30s—when
was always just around
around
However,
the
as
leveled
off,
vestors
became
speculators
Prosperity wasn't
all.
To
mirage, after
a
the end of the
boot,
profits
cess
corner.
earnings of
At
And
tive.
large corpo¬
time, more
stocks
the
to
same
of
treatment
tax
made
dends
divi¬
attrac¬
more
in business
upturn
that
the
American
not as
supposed.
indicated
volatile as
We
could
was
economy
been
had
corner!
the
ex¬
promised
tax
rations.
favorable
in¬
and
its
own
be¬
market
the
ad¬
all
the
corroborates
supporting arguments. It attracts
buyers.
Avarice — the lust for
riches
easy
The market is
which
has
its
rising
encourages
power:
mitments.
more
holders
makes
It
So
richer.
feel
they're
inclined to spend money on
vacations,
prosperity.
automobiles,
homes,
jewelry. It generates
It
confidence.
creates
consider the study
committee
this
appropriate.
re-examination
minded
made
of
and,
—
be
therefore,
re¬
man-
are
can
be
man-prevented. Only by watch¬
ing ourselves — by regenerating
some
of
the
which
caution
pre¬
vailed in the early
—can
we
the
postwar period
against another
guard
this
the
at
hearing.
crash.
a
It
It
will
Because
growth
that
or
it's
a
wrong
foredoomed
a
phi¬
the
on
era
or
The
there's
that
The
rising.
op¬
isn't
danger
is
that
danger
resemblance
a
to
things past. The danger is that
imaginations
may
run
so
far
ahead that, ultimately, reality re¬
turns
with
compound
violence
and then the
other
is
There
imagination
the
runs
Frorri boom to doom!
the danger that peo¬
way.
in the sav¬
ings banks—to pay doctors' bills
in time of trouble, or to put their
children
through college, or to
ple who have
age—will
that
in
themselves
of
care
money
suddenly
their
decide
to be
fools, that they're
swing, that they ought
in Wall Street. They'll con¬
vert
that
they're
in the
not
cause
cash
easy
Wall
into
The
will
rise
the
business
or
market;
the
in stocks,
of their
out
money
borrow
the
danger
attention
to regular
There
stocks
to
in
that has been happen¬
More and more people are
turning to the stock market page
the comics. They want to
figure out their winnings at the
end
of each day.
That's not a
good sign. The market has be¬
before
come
a
buying
speculators.
stocks
St.
letter
Attention
to
would
I
I
This
has
fear
well.
try
called
business
was
recession
persons
—and
expecting it.
said
history.
So
predicting it
The same can
1953-54.
about
in
best-ad¬
the
in
were
many
coun¬
decline
1949
vertised
be
the
served
The
A
(When
people worry about a prospective
decline, they do not over-commit
themselves.) Businessmen, fearful
a
recession might develop,
that
didn't
head
go
.into
heels
over
They didn't get overex¬
tended on inventories. The tend¬
debt.
for the most part was to be
underbought
rather than over¬
ency
didn't
Speculation
bought.
be¬
naturally
This
Wall
affected
Although earnings of cor¬
Street.
porations began to rise sharply,
starting in 1946, the stock market
didn't; follow.
People reasoned:
We .had
postwar business de¬
1918, we'd have one
a
after
cline
again.
gomery
showed
Avery, of Mont¬
& Co., actually
Sewell
Ward
stockholders
a
chart
in¬
inevitably
after
commodity prices col-
that
dicating
every
war
lased.
When stocks broke in 1946,
people said: "This is it."
recession
A
The
low.
ing*
as
a
surely
stock
would
fol¬
market was act¬
barometer of business.
But industrial
10
omy
Joint
production and em¬
The
Securities
has
mittee
able
already
service
in
Reserve
other
Board
loans
to
for
be
on
the
growth of the economy to 1965 and
came up with a figure of $535 bil¬
lion—that
I have here a
chart which com-,
earnings and
stock prices. From 1946 through
mid-1949, earnings rose, but stock
pares
corporate
Livingston before
le
hearings on the Stock Market, Senate
unking and Currency Committee, Wash♦Statement
gton,
by
Mr.
D. C.» March. IS,
1955.
any
carrying
stocks.
I
hope the committee can persuade
the
Board
collect
to
such
no
This
is
important for two
than
we
want to know the total
brokers'
be sold—in
to
the
a
might have
event
by
Board's
no
said that this
Mississippi
offer
are
or
to
sell
after—became
projections
the
fashion.
still
are
Tomorrow's
what
the
on
or as a
solicitation of
March 30, 1955
305,000 Shares
Such
Florida Power 8C
fashion.
counts,
not
to¬
Light Company
day!
These
projections
tributed
to
the
—
Wall
increase
in
Common Stock
con¬
enthu¬
sales
No
Par Value
of
the passing out of
stocks,
penny
have
Street
the confident purchase of
"blue chip" and "growth" stocks,
tips,
and the entry
ket
of
their
in
into the stock
who
persons
minds
own
they're doing.
the
The
"This is
a
about
rapidly
—
to
take
of
care
roads;
homes; and we're in an
need
we
we
era
new
technology.
You're
can
deep
ment
lawfully offer these securities in such Stale.
Merrill
Kidder, Peabody & Co.
Lynch, Pierce, Fenner & Beane
will
The First Boston Corporation
Eastman, Dillon & Co.
Smith, Barney & Co.
Union Securities Corporation
Clark, Dodge 8C Co.
Drexel & Co.
White, Weld 8C Co.
Hallgarten & Co.
up.
see
to
that.
The
Em¬
ployment Act of 1946 requires the
government to step in if business
if unemployment rises.
And
have built-in supports: Unem¬
ployment
and
may
our
We're not going to have
depressions.
The
govern¬
we
as
things—electronics, atomic
term, the only direction they
sags,
brokers
schools and
new
is
or
We have
year.
population.
youngsters;
need
a
going to need
We're
The Prospectus may be obtained in any State in which this announce'
men! is circulated from only such oj the undersigned or other dealers
growth country. Over
expanding
colleges
go
$63.50 Per Share
what
argument
it has expanded at the
rate of about 3%
of
Price
mar¬
not clear
rationale—runs:
the years,
a
are
compensation,
old-age
insurance,
mini¬
survivors'
Hornblower & Weeks
.
Laurence M. Marks & Co.
Paine, Webber, Jackson 8C Curtis
not
cov¬
regulatory limits
Continued
—you
you
de¬
a
the
Federal
Reserve
margin rule.
There are
statutory
of
as an
of
cline.
Second, such loans
about
which would
be vulnerable—which
ISSUE
Future projections
didn't think of 1956 or 1957,
only thought of 1960 and
rea¬
sons:
One,
circumstances to be construed
data
regularly.
oj these securities. The offering is made only by the Prospectus.
$365 billion.
of
energy,
homes
NEW
offer to buy
which
purposes
than
against the 1953 level
as
ployment didn't understand! They left behind if
you don't stake a
kept rising.
The pent-up wants claim to this
expanding America
of
Americans—repressed during
by buying stocks.
the war—couldn't be denied. Nor
"Maybe stocks will go down
did
American manufacturers of
automobiles, television sets, re¬ temporarily. But over the longfrigerators or builders of
want to. deny these wants.
This announcement is under
me
projected
Report
Fed¬
collect
securities
on
to
not¬
a
the
sales
an
Economic
Credit
done
asking
econ¬
The staff
now.
Committee
the
urge,
Presi¬
$500 billion
from
years
the
of
a
a
—
rationale—developed.
dent talked of
siasm
excessive.
come
psychology
new
feel
in
out
have declines without collapse.
Benefit From Fear
their
they
up,
lost
therefore, that
particular attention be paid to
credit
used
for
purchasing
or
carrying
securities.
This
com¬
going around touting
indication
when
go
They've
race!
the
Regis Paper.
an
And
don't
poorer.
ered
chain
preoccupation.
People are
for income but for
quick
capital
appreciation.
They're
not
investors.
They're
not
amount of collateral
wrote
Pont
make
can
And
out.
advice, in the rise in tips.
I
Pont
producing nylon and
then it's time to watch
ing.
increase in
receive asking for mar¬
Recently,
was
du
by
dacron,
minor manifestations
boardrooms,
I
than
stock
easier to make
becomes
faster by buying du
money
activities.
are
of that now—in crowded
letters
Once it
money
is
people will begin to devote
more
ket
to
money
an¬
that mattered.
on
business
think
was
didn't mean anything to her. The
possibility of easy profit was all
stated
that
to
she
sug¬
Tne caution
are
is
ought
she
v/e
noyed and hung up.
data
danger
could
When
she
money's to be made in
take
that
that
to
twice before buying,
eral
seeing
men,
Regis?!
stocks—be¬
Street.
Where
woman.
St.
wanting
for quick
behold, the next
a
telephone call
market
and
received
a
gested
we
phi¬
danger isn't that we're
market
isn't
market's
to
bubbles
that
and
clinical
a
the
need
We
processes.
timely
so
need
We
suggested
play
—
outside Wall Street.
and
That's why I
of
en¬
ulti¬
both
And
risk-taking.
mately, it fosters excesses
in
of
principal
We may well be
of another great
timistic.
—
ex¬
pand plant, to make forward com¬
securities
The
people
—
the
Lo
I
buy
im¬
growth.
old
stimulates
businessmen to
A
crash.
a
follow
threshold
take
while.
a
market
—
It
indications
own
true—for
come
Street.
business indicator
a
wondrous
a
make
Wall
into
is.
rationale—a
doesn't
brings newcomers
—
old-timers
and
confident.
more
it
vances,
has it
Street's
era
Wall
of
When
courages
recession
cushion
Americans emerged from World
War
havior.
It
Confidence
in
Increase
this
including
aplenty,
rationalism.
its
have
to
certainly
A
hopes
Then
rose.
got under
it
fears—was renewed.
prewar
Prices
And
the
losophy which resembles 1929—it
led
Every
1929.
poorhouse in
has
era
which
rationalism
Era
the
to
setback.
postwar
setback
hidden
country's
safeguards throughout the postwar
period has been tne vivid re¬
membrance of two depressions—
the
an
limit
that followed.
trials
the
than
declined.
the
account
Con¬
This isn't too different from the
New
can
prices—a
t
A. Livings!..
is
that
still remember—and well—
gress
And
would
tax
temporary
a
Soon
a
It
evidence
II.
War
rationing.
profits
stocks
So
pretty
Minds
1950.
World
earnings.
That's
after!
the
They actually
have
excess
crash, not
a
by
were
instituted—in modified form.
We
is
.
in
to
reinstituted.
investigating
committee
War
back
Shades of New Era Rationalism
rationalization
arrested
was
Price and wage controls might be
Senate
a
their
shed
began to advance—
to earnings.
rise
The
difference
speculators
Stocks
fears.
hear¬
ings is
jor
about the
market.
that
me
I
for
help prevent
a
into
get
day
1929
leave
it
is
—
wait
have
bubble-ism
from
From
to
believe
philosophy
long-term inflation."
of
pression that I think this is 1929.
losophy.
am
arc
ahead
Hearing; the Main
Differentiation
beginning
Peace in our time isn't
likely.
common
gains tax be accentuated further between long and short term.
I
markets
get
-
difference—as
government
replica of 1929*5 New Era rationalism which led to poorhouse.
They
profit!
Senate
calamity and has the responsi¬
bility for ending it—promptly.
"Any drop will be short-lived.
journalist cites fnture projections into 1960 and
Stock
themselves.
workers, and a flexible
system—as incomes drop, so
the
Syndicated Columnist
as
bust.
like
do
By 5. A. LIVINGSTON*
after,
serious
tax
Financial Editor of the "Philadelphia Bulletin," and
Financial
that
unions
strong
wages,
protect
9
F. S. Moseley & Co.
L. F. Rothschild 8C Co.
page
38
10
The Commercial and Financial Chronicle
(1502)
income,
Tax
paid
trust, he gets a
that reduces his
Certified Public Accountants, New York
sliort-term
law provides taxpayers
family
and inter¬
them at their
with
an
opportunity to provide their
a short period, and at a
Vin
work to the considerable
tage
of
with
ad-
S
of
are
Where the wife is the beneficii—
ary, there is no savings- on income
distributed to her sincejit would be
includable
some
and
the i n:t erim
be
cx.n
of
close
a
be
if
and
neither
trust term would be $5,000.
Suppose each child had as much
the new
year
Cresting tax facility. s In the
p .si, a short-term trust was surj'c:zaded
with
all
sorts
of tax
$2,000 income of their own. At
as
the end
10
of
years
on
the $10,-
the 000 of income they together got
from the trust they will have paid
si'.ration definite, clear and libcral.
Through such a trust, in- 20%, or $2,000 in tax. The father,
who set up the trust, would have
ccme-producing property can be
had to pay a tax on that $10,000
transferred in favor of a named
of $5,000,
resulting in a $3,000
beneficiary.
At the end of the
trjit
period, the property
can saving.
The tax cost of setting up a
ccrae back to the person who set
short-term trust is the gift tax on
tiw the trust (called the grantor).
The
ubts.
makes
law
new
of the trust
term
locst
10
It
years.
be at
must
be
also
can
benefici¬
al j of the trust, and if the beneiitJary dies before 10 years, the
fecnred to the life of the
t.^st
still
qualifies.
such
With
income
the
trust
a
fiom its assets is not taxed to the
jgiantor, but to the beneficiary, or
the trust,
depending on the terms.
•Tax saving is derived if the bene¬
ficiary
tax
the trust
or
in lower
husband for his
or for her life,
a
wife for 10 years
which
back
to
band
can
the
the
trust
husband.
assets
The
go
hus-
be the trustee and have
powers over the administration of the trust. The in-
fairly broad
come
lated
be paid out or accumu-
can
for
the
wife
in
the
the current value of the
hus-
band's discretion, as trustee.
Assume a married couple where
In
income.
be
most
10 years'
this will
relatively small amount.
a
will
It
be
cases,
the
from
seen
going that the
fore¬
of short-term
trusts with the principal coming
back to the grantor after 10 years
can
payable
tax
^
use
achieve substantial income
tax benefits.
on
reduction
tax
Where
the
(A restriction exists
of
or
$8,490
the grantor there
ls n0 estate tax saving, since
considered his, for
estate taxes.
The
discussion
foregoing
the
that
cates
law
new
indi¬
for
income
and
at
family
their
provide
with
a
low
period,
The sav-
cost.
tax
charity
or
short
a
ings are increased the larger the
period. The savings are also increased if instead of the property
coming back to the grantor, it
goes to somebody else,
Stern, Douglass & Go.
Formed
Coast
on
SAN
Stock
San Francisco
Exchanges, has been formed
with
offices
Street.
California
465
at
Partners
are
Carl
W.
Stern, Charles Dreifus, Jr., Donn
C. Douglass, Harry F. Flachs, Earl
s> Douglass, Chester Apy, Emmet#
A. Larkin and Joseph A. Johnson."
use
Joins
trusts can be made where charity
is going to be the beneficiary. In
that event, the trust can be as
short as two years, after which
dorf is
can
the grantor.
taxable to the grantor.
connected with Good-
PONTIAC,
Beamish
gets no deduction for payment to
charity by reason of setting up the
trust.
He does get such a deduc-
\yist
Mich.
—
&
"street^
Huron
Randall
dren. Then he gets the benefit both
staff of B. C. Morton & Co., Pen-
and
that
the
only
have
you
has
made
dollars
he, Roosevelt, Stalin and others
plain facts
are
that there is nothing substantially
has
been
.
obscot Building,
income
With Barret, Fitch
(Special to The Financial Chronicle)
KANSAS
M.
CITY, Mo. —Edward
Cox, Jr., is
Fitch,
North
now
Co.,
&
with Barret,
1006 Balti¬
in
new
the
papers that has not been
fairly widely known. But their
publication does dramatize to more people, to the American peo¬
ple generally, the story of this country's greatest tragedy. In this
they
manner
the
help
disclosure shcu'd
politically,
Republicans
at
or
least,
the,
help them.
The defense of Roosevelt now, as
that he
it has been in the past, is
guided by the advice of the military chieftains, not
was
only of this country, but those of Britain.
The British people seem to have been
kicked
our
Churchill
indispensable
tains.
If
they
out
of
office
the
after
realistic.
more
end
the
of
They
As
war.
for
he appointed the American military chief¬
him bum advice, which is the defense of him,
man,
gave
still his men. He was responsible for them.
As a
chief of state, furthermore, he was supposed to be capable of
evaluating the demands of the military which all history shows
are
invariably excessive.
However, there is this one thing that can't be escaped in
connection with Roosevelt's dealings with Stalin. He was sym¬
pathetic to him, considered that Stalin in his own way was a
they
were
great
him
is
a
very
a
way
the
From
attitude
statesman
trying to handle the problems peculiar
that would improve the lot of mankind. This
generous view of Roosevelt to take.
in
beginning
towards
Communist.
But
in
what
history and world
slightest frighten him.
he
Presidency,
do
I
he
not
thought
suggest
his
was
had
that
great
He
of
man
knowledge
looked upon them
competent people who could get things done.
very
friendly
he was a
a
movements, Communism did not in the
He welcomed Communist agitators in his
government, in the labor unions.
own
a
his
of
Communism.
of
action, determined to make America
vcalled it before and I do
And he
I have
over.
as
was
re-
again, the repeated statements of Mrs.
isevelt to the effect: "What's wrong with the Communists;
they^are pursuing the same ends as we?"
so
were
trying to help the
un¬
derdog.
So the Roosevelts professed to be; so did the Communists
profess to be.
.
.
There
is
little
doubt
>
colonialism and it
he
considered
in
this
Churchill
writer's
more
the
mind
that
at Yalta,
Churchill;
worth while than
apostle of British
imperialism
his determination to make the British
was
the British Empire
made
ment
Indeed,
war.
give at the end
The result is that after World War II there is
our
govern¬
of World
no
War I.
British Empire.
This attitude towards Britain is not unpopular in our country.
have gone to war twice to help Britain but paradoxically,
In
Harold E.
added to the
—
Carlisle Bargeron
realize that
writing
to
million
a
'
The
closure
DETROIT, Mich.
our
engaged.
(Special to The Financial Chronicle)
he
amount of of the charity deduction and reis ac- lief from income tax on the trust
cumulated by the trust during the income.
10-year period for the wife, the
For exampie, assume that $20,tax on the $4,000 of income will
000 of property is put in trust 10
be only $800.
Thus, the tax sav¬ years for charity, after which the
ing on the $4,000 of income is property goes to the children. Asabout $1,200 per year.
This is a sume also that the present value
producing
this
both instances, there has been
thing to Britain at the end.
by $4,000 by placing in trust propincome,
knowledge
in
With B. C. Morton Co.
provides it is to go permanently
to somebody else, like to his chil-
erty
the
about the secret parleys in which
We
top $4,000 of income is $2,000. If
the husband reduces his income
him
because
will be
powers
get the full draught of the delicious-
of
_
tion if instead of having the trust
to
can
Empire "give" at the conclusion of the
LaVerne
has
the husband has about $3-3,000 of
taxable income. The tax on the
back
bungling on
never again be
was
the
in
that
joined the staff of
Merritt & Co., Inc., 53V-i
King
come
freely
in
papers
governments
and
King Merritt Adds
(Special to The Financial Chronicle)
On the other hand, the grantor
property
foreign
talk
Churchill
Penobscot Building.
Co.,
There
among
a
squabbTe
the
Yalta
Roosevelt considered Stalin to be
During the term of
the trust, the income will not be
now
body &
the
of
in
times
Sh^>meant that the Communists
DETROIT, Mich.—Paul J. Ras-"
be retrieved by
the principal
Goodbody Co.
of
to
To
(Special to The Financial Chronicle)
short-term
of
consider
to
got
the
to
up
It wasn't fair, it
heads
Douglass & Co., Inc., members of
and
nose
not
disclosure
conferences
fellow
FRANCISCO, Cal.—Stern,
the New York
its
government will tell.
to
>
the
light.
provides
taxpayers with an opportunity to
in trust is stock
a company in which the grant¬
has a dominant influence.)
further
this
property is to
trust
have
You
around
ness
410
of trust-.
where what is put
A
grantor.
example, securities can be
put in trust by
slier
are
the
brackets than
For
Net
since
Accordingly, the tax saving, to a
50% bracket taxpayer over the 10-
for having the
3 and eating it too.
Vhe short-term trust is
no
that is less
the child's $600 exemption.
than
fulfill
ii
c
gift
even
other income, there
tax to pay on these
amounts
$500
Seidman
William
L.
itrt elusive search
*
children,
two
will
rangement can
pi
Less
creation
child has any
family mem¬
ber, the ar¬
Hi) most
$8,900
come1 to^be"pmd*annu^lly"to "each come back
eficiary
down
looks
part of Washington,
at the Republicans.
articulate
They are simply
"changed world."
afraid
6,000
Total
savings are
sometimes
possible. For example, if a trust
is set up with about $500 of in-
porary
still
nating $20,000 from estate
beneficiaries.
children,
of
case
the
any
the
greater
lx; only tem¬
L on
the
In
ing negd
y&j
moulders,
opinion
The
correspondents.
newspaper
the part of Dulles.
However, that
dren, or others are
the
from
saving
__
That is to say, the vast bureau¬
the level just next to the top, is Democratic. The Wash¬
ington politico lawyers, a very influential group, an accompany¬
ing part of a Washington government, are
Democratic, also the great majority of the
deduction for charity— $2,900
saved by elimi¬
and
apply
to
short-term
trusts where children, grandchil-
beneficiary.
tax
x__.
Estate tax
not
does
other
Exduse
husband's
the
in
wife's joint return.
mem-
or
Income
,
bene-
ftrr- .ly
"t.Li
.
gift tax
terminating in a different the tax reduction can be summarready to part year, with different provisions.
ized as follows:
income
the
...
.
the lowest
in
each
temporarily
for
.
...
.
is
brackets. For instance, separate bracket, and in the 30% estate tax
trusts might be set up for a wife, bracket (about a $160,000 estate),
high
in
taxpayers
tr?ckets, who
in
of
grantor
a.r.
result
will
also
than two years of the Eisenhower Administration,
more
on
cracy
erty and so it is no longer in his
estate.
If we
assume
that the
low tax cost.
A. provision in the new tax law
By CARLISLE BARGERON
After
estate tax since the
grantor has parted with the prop¬
saving
charity with income for
or
of the News
Washington is still Democratic.
tax rates.
own
trust
This
capital gains taxes, and concludes the new tax
and
uncoine
Points
trusts.
Eventually the property will go
to the children and the income in
their hands
will be
taxable to
illustrations of tax advantages of
out savings may be had both in
esting tax facility, cites
1!
$10,000 income is
only $2,100.
City
Mr. Seidman, holding the short-term trust is a new
Washington
Ahead
by $2,900, so
of providing
tax
the cost to him
the charity with
Seidman & Seidman
From
setting up the
charity deduction
By
$5,000.
that
have
tax of $5,000, leaving him
a
with
By h. TV. SEIDMAN
;
Thursday, March 31, 1955
.
10 years, the charity
over
gotten the $10,000 he would
Short-Term Trusts
.
get $10,000. Had the grantor
will
Advantages oi
.
the
political
in
melee
our
determination to do
Washington which
the
some¬
Yalta
dis¬
has
caused, there is the effort again to separate Eisen¬
hower from the Republican party.
He is on record against the
Republicans seeking to make any political capital of the disclosure.
The
papers should be studied, in his opinion, with the view of
learning past mistakes for our guidance in the future.
There
should, however, be no effort to attach personal blame on hind¬
sight, he says.
Senator Knowland and other Republican Senators
say this is
the President's personal view but they intend to
go right ahead at¬
taching personal blame.
Whereupon, the Democrats contend the
that if he were he would
President is not the leader of his
party,
.
.
6*0%
on
in
reduction
in
tsxes
psysble
the $4,000, or a 10% reduction
«...
the husband's .nl,™ tax hill
entire
bill.
Over
period
10-year
a
the
tax
the
lO-vesr
go
to
the children
saving is $12,000.
gift tax will
during the 10
years the trust sells any of the
securities at a profit, the capital
gains realized may be taxed at a
rate as low as 10% instead of the
the
25%
tax
Furthermore,
the
pay on
If
if
husband
may
have
to
his capital gains.
larger-
trusts
are
$14,200.
of
income
is $14,200.
have to be paid
On
the
other
the $5,800 can be taken as a
to
duction
will
saving to
of
result
a
in
an
hand,
char¬
During
Avenue,
members
of
the
the
tax
savings
can
between the President and Knowland and the other Senators.
ence
Two With E. R. Bell
The
President's attitude
the
pe-
seems
the
(Special to The Financial Chronicle)
position to take.
KANSAS
V.
CITY, Mo. —Richard
Hartnett
have
and
become
Earle
affiliated
H.
Smith
with
R. Bell Co., 4627 Wornall Road.
With
A
C
VAxmSA*
Wlth A* ^ ^dw ds & ^ons
-'
(special t0 the financial chronicle)
It does
proper
one
for
Overlooked
that
a
also
Republican
Republican
in
this
President
leader in the
peculiar to the Democrats.
patronage
man
power
nor
control.
in his
cannot
Senate.
In
in such times.
*
■
Democratic
my
propaganda
very
The
well
one-man
get
is
the
rid
party
of
have changed, at least
a
The President
Eisenhower
has
assumes
some
tre¬
nothing like the
one-
people to realize that times
little.
I
/
the
theory is
the money to spend that gave Roosevelt his
It is difficult for
fact
lifetime the Democratic party
has been in power in times of crisis.
mendous
man
a
not, however, foreclose the attitude of
Senatorial leaders of his party.
E.
income
riod that the income is received,
the Republican leader.
as
In the first place, it is doubtful if there is
any serious differ¬
be the grantor will not be taxed on
ST. LOUIS, Mo. — Robert W.
maintained or increased by hav- it. nor will the trust pay any tax Kerckhoff is now with A. G. Edmg more than one trust, since each since the income is going to charwards & Sons, 409 North Eighth
trust is a separate taxpayer, and ity.
Street, members of the New York
gets a new climb up the tax
Assuming a 5% annual rate of and Midwest Stock Exchanges.
plated,
get rid of Knowland
^
Mldwest stock Exchange,
on
50% bracket tax-
$2,900.
more
-n/r-
A
ity deduction by the father in the
year the trust is set up. This de¬
payer
contem-
sift
charitv is $5,300 and that the pres^
q{ what ^ uUimatejy
Volume
181
Number 5416
.
.
The Commercial and Financial Chronicle
.
(1503)
have
we
Geneial Motors Looks
authorized
of future
expiration
this
The
is
program
com¬
of
the
subscription
remaining
point
men¬
pleted, General Motors will have
tioned in your letter is the
expended
which
in
By HARLOW H. CURTICE*
and
President cf General Motors
the
stressing
intense
competition
industry, Mr. Curtice reveals the
the
in
why the
reasons
^future economic growth.
Motors
Employees'
Canada
has
company
its
automobile
industry from
inception has been most
very
intensely competitive.
competitive
more
time
any
its
as
forward
our
50
It
is
even
than
today
at
this
dustry
in¬
another
.2,700
from
the
market. Today
bare hanaful
Curtice
H.
Harlow
survive,
original
others
vanished,
have
Because
have
products'
to\ this,
ne
their
sufficient
person
the
—
In
General
not
of
have
build
to
striven
into our
offer
than
money
Each
year
the
quality,
economy,
appear¬
comfort and safety. This
striving for
improvement
is
a
particularly outstanding element
ance,
•of
in
competition
much
more
industry
our
Last
this
as
lines
last
sales
2%
of
We
our
1953
out¬
result, our
within
a
year
considered
the
year,
represented
standing values. As
total
were
all-time
this
record.
excellent
an
showing particularly in view of a
30% decline in defense business.
Defense
only
deliveries
14%
of
for
accounted
total
volume,
com¬
pared to 19% in 1953. The decline
nearly offset by the customer
was
of
appeal
and
civilian
our
of
part
our
dollars
$9.08
or
income
net
share,
per
time
crease
share in 1953. This in¬
over 1953 was largely the
result
of
per
United
We
the
States
provided
elimination
profits
excess
million
749
the
of
tax.
dollars
for United States income taxes in
1954
996
and
million
dollars
in
1953. of which 192 million dollars,
$2.20
or
share,
per
was
for excess
profits taxes.
In the two decades
war
capital
our
were
met
prior to the
requirements
out of
entirely
almost
reinvested
earnings.
though
Postwar,
al¬
ly higher percentage of earnings
than in the 1930's, this source of
capital funds was not sufficient to
cover
have
and
resorted
market
1946
limiting factor.
a
1946
tween
we
needs. Taxes of course
our
been
loan
the
of
end
Be¬
1953
capital
including a
to the public
three
times,
from
in
*From
the
a
insurance
com¬
Committee,
18,
by Mr. Curtice be¬
Banking and Currency
statement
Senate
reasonable
a
divi¬
Washington,
1955.
D.
C.,
March
plan
in
customers
our
ahead
to
us
it
as
is
for
designing and engineering
in
the
early
our
should
national
gross
product
in
dollars
total
184
500
households
of
from
crease
population
million, almost 20
than
today.
The
more
number
lion,
of
1954.
We find that by 1962
may
Six¬
achieve
dollars, compared with 357
billion
48
creating
should
about
to
in¬
mil¬
tremendous
a
54
new
demand for
homes, motor vehicles
and other goods and services.
Assuming maximum utilization
of
the
country's
economic
re¬
-—•in
sources
employment
that
other
is
it
—
disposable
words, full
estimated
income
personal
might well be about 40%
than
higher
growth
to
keep pace
appraisal of the normal
the
of
Corporation's
for
market
products.
We
the
also
expect from time to time to make
additional
investments
for
de¬
fense facilities, as required by the
Armed
Forces.
For
example,
members
be
this
of
interested
have
just
which
Committee
to
know
authorized
will
•
dollars
of
that
a
project
has
to
ex¬
vehicle
Motor
total
about
disposable
estimate
that
by
over
be
registrations
million.
58
income
75
registered,
than
You
million
recall
may
forward
the
fact, there
more
with
recession
also
the
time
a
dubious
mass
ward
to
future
meet
needs of the Armed
Forces
we
as
anticipate them.
In
conclusion,
complishment in
expanding
be
who
seek
of
success
demonstrates
on
bile
willingness of the automo^
industry to
capital
undertake
investments for
large
and
new
improved facilities
for
Stock
Committee
of
other
sub¬
productive
As
gram
often
is
has
one
interest
in
in
low
the
present stature.
the
to
acquiring
stock
policy for
been that
tive
for
em¬
purposes.
by
plan
should
make the participating employees
and
Basically,
designed
to
efforts
is
to
plan
permitting
by
in
through
the
employees
spur
share
to
in the
partners
business.
maximum
results
the
ob¬
invention,
their
ability, industry, loyalty and spe¬
cial service. Participation in the
plan is determined on a selective
basis
the
and
amounts
reflect
awards
the
of
individual
of whom is a partic¬
employee, administers
ipant
or
committee
of
direc¬
A
tors,
the
plan.
a
continued
case,
and
half
our
now
billion
gram
in
of
the past
750
penditures
program are
million
for
dollars.
dollars.
1955
pro¬
reached
under
a
Ex¬
this
estimated at 500 mil¬
dollars.
The
expended
in
include
200
modernization
our
year
pro¬
amounts
Capital expenditures for this
remainder
1956.
This
million
and
single
strength
It
con¬
of
has
the
given
individualized
an
transportation
of
additional
department
management
of
Paul
established
was
came
elec¬
new
A
new
the
under
Schoessling
earlier this
had
member
a
year.
75
employs
member
a
Midwest,
Stock
1944
employees.
rently
is
of the New York
Exchange in
125
Detroit
wires
Kansas
Grand
City,
private
in New
in
Mt.
and
in¬
Cleveland, St.
Louis, and Dallas. Offices
in
York,
Detroit
Mich., and to
vestment houses
located
and
York,
American
has
It
Mo.,
Rapids,
New
and
its offices
to
cur¬
persons,
the
of
it
when
The firm
Exchanges.
are
also
Milwaukee, Wis.,
and
Clemens, Mich.
enjoyed
Joins
Ball, Burge
earth.
on
feet
at
has
now
(Special to The Financial Chronicle)
must
progress
will
and
continue to insure the creation
CLEVELAND, Ohio—Charles F.
of
has
Steinman
still
tunities.
can
and
more
the
better
Only
by
job
such
automobile
oppor¬
progress
industry
con¬
maximum
to make
tribution
its
Commerce
the
to
Building,
the
New
Steinman
our
maximum
to
do
was
formerly with
(Special to The Financial Chronicle)
PORTLAND,
others
sure
Exchange.
Zilka, Smither Adds
con¬
tribution.
am
of
members
Stock
Paine, Webber, Jackson & Curtis.
We in General Motors will con¬
I
York
expansion of the
national economy.
tinue to make
associated
& Kraus, Union
con¬
Mr.
tinue
become
with Ball, Burge
are
determined
Wilson
is
Ore.
—
Robert
L.
with
connected
now
Zilka, Smither & Co., Inc. 813 West
likewise.
Alder.
With Inv.
Planning
r;
.
^
Bache Adds to Staff
(Special to The Financial Chronicle)
the present bonus
Because
plan
as
approved by our stockholders
does not provide for the use of
newly issued stock, it is our prac¬
tice to acquire
stock for bonus
purposes
in
the
open
market.
Purchases
are
made
daily and
spread
the
other people
Such
per¬
formance.
none
no
conceived incen¬
compensation
them
of
means
its
to
The industry has
greatest
people
our
35 years has
over
well
a
fol¬
we
as
the
over
lifetime,
economy.
indicated
procedure
ploye bonus plan
evenly
as
is
tourneau
now
with
WHEELING, W. Va.—Theoren J.
Investors
Planning Corporation of New Eng¬
Murvin is with Bache &
land, Inc., 68 Devonshire Street.
Chapline Street.
This is not
possible over
as
(Special to The Financial Chronicle)
BOSTON, Mass.—Oliver D. Le-
an
offering of these shares for sale, or an offer to buy, or a solicitation of an
The offering is made only by the Prospectus.
Co., 1219
offer to buy, any of such shares
the trading days of
the month and
well as throughout the
period in a day, irre¬
as
year
spective of price movements. Bids
are
made
in
relatively
small
Our stock
,5v /
190,566 Shares
purchases are
Kentucky Utilities Company
monthly to the New
York Stock Exchange so that the
number of shares purchased cur¬
ord.
In
Common Stock
($10 Par Value)
matter of public rec¬
addition, the number of
a
in
held
shares
Treasury
in
bonus
for
disclosed
the
Rights, evidenced by Subscription Warrants, to subscribe for
purposes
will
does
dollars
expansion
facilities in Europe which
these shares at
$24.75 per share have been issued by the Company to holders of its Common
Stock of record March 21, 1955, which rights expire April 11, 1955, as more
Corporation's
the
is
fully set forth in the Prospectus.
quarterly finan¬
the number of
shares
purchased and delivered
under the bonus plan is detailed
cial statements, and
in
the Annual
Our
York
Stock
of
stock
common
on
agreed, subject to certain conditions, to purchase
unsubscribed shares and, during and after the subscription period, may offer
The several Underwriters have
any
Reports.
purchases
Motors
shares of Common Stock
as set
forth in the Prospectus.
General
the New
Exchange have aver¬
Copies of the Prospectus may be obtained from any of the several under,
only in States in which such underwriters are qualified to act as
Prospectus may legally be distributed,
aged 2,000 shares a day in the last
writers
four
dealers in securities and in which the
years.
purchases
During these years
equivalent to 15%
were
total
the
Motors
No
the
grown
and
has
single
a
Purchases
has
well
as
—
improved products-
brought the industry,
\
all U. S. exchanges.
activity
high level.
and
new
Street,
It is installing a
Stock
The
serv¬
Straus, Blosser & McDowell be¬
sound
a
provid¬
located
formerly
square
municipal
is available to
it
new
South
tric stock quotation board.
basis.
national
Your
economic
of
offering
tributor
Motors
General
of
not
The
that equity capital
those
space.
will continue
economy
stock
our
firm,
1,500
ac¬
and
dynamic and
our
substantial.
the
believe
we
to
39
at
Chicago,
Street,
135 South LaSalle
opportunities for service
to
The
effect upon our for¬
no
removal
quarters
cities,
ices for customers.
such,
as
larger
firm
principal
ing improved and expanded
"Stock
planning.
become
facilities have grown substantially
over
those of a
year
ago,
and
for
automobile
particular.
fluctuations,"
have had
span
com¬
facilities.
new
country's
In
unem¬
many
invested
in
in
outlook.
However,
stantial "funds
Today
at
were
much talk of
was
ex¬
outlay
dollars
was
people
in
early
an
billion
economic
ployment.
lion
in
investment
in
their
announce
our
LaSalle
general and of the
industry
ward
products
offices
reported
announced
for
1955. This
many
about
total
based upon
McDowell,
in
has
amounts.
of capital
calling
one
1954 and
when
to
with
and
of the Allison Division and to pro¬
for the development of for¬
we
vehicles
of
that
Motors
program
penditures
a
&
planning
evaluation of economic conditions
vide
rently is
General
about
the
engineering, research
development and testing facilities
may
there
1962
increase
an
With
40%
up
30%.
1954
at
planning. Frankly,
always been
Quarters
CHICAGO, 111.—Straus, Blosser
business
forward
our
million
funds
own
we
75
involve
our
will
pand
trading
today.
ing
capacity
our
some¬
Nineteen
country
our
billion
of
with
tained
Our studies indicate that
time
a
expen¬
General Motors
our
products.
a
capital
assure
stockholders
laboratories,
engineers
stylists to work years ahead
ties
to
adequate
same
policy.
years
be
fore
the
for
the
at
research
retained, a substantial¬
we
and
the needs of
and
and
Our
corporations
Capital Requirements
Postwar
the
dollars
needs
make
maintain
the
Motors'
to be
are
we
com¬
pared with 598 million dollars or
$6.71
in
in
million
806
to
us
additional
capital
expanding
well
amounted
we
goods
now
dealer organiza¬
Motors
General
It led
300 to 350 million
of
on
tion.
1954
that
equity
the
competi¬
market.
meet
products
by aggressive sales efforts
the
highly
conclusion
million
year,
and
ready to
share in the country's growth and
—
than in most other
so
industries.
product
the
is needed if
seek
we
to make them leaders in perform•ance,
the
trends
for
year our cars
the
before.
.year
for
projec¬
our
we
values
greater
for
upon
because
have
we
constantly
products. Each
:more
seek
the
customers
also
to
resulted
winning
in
only have priced competively
but
to
capital
It is just as important for
appraise our markets and
Motors
successful
votes
added
decision
economic
permanent
dend
•customer.1
been
dollars
based
of
area
hose
•a
•appeal
capital. This
our
outside
was
to
have
:2,700
of
tive automobile
of
on
dollars
million
recent
outlook
differ¬
been
in
400
have upon our
In New
effect
fluctuations
our
tions
some
•cars
in
issue
analysis of our forward
capital requirements. This analy¬
sis
or
makes
stock
debenture
million
Our
of
time
preferred
the
tools, dies, jigs
specifically appli¬
market
models.
new
substantial rate, both to keep
facilities and products mod¬
a
our
represented
further
customer.
ent
added
aggres¬
one
upon
capital in this period, the balance
having been reinvested earnings.
com¬
favor
the
At
1953
dred
sively seeking
the
of
and
special
to
General
approximately
17% of the two billion, three hun¬
petition
means
issue
1946
sum
history.
In
The
each
ditures, of necessity, will continue
repaid in 1949.
was
one-
stock
market
ern
panies which
and
expenditures
fixtures
cable
at
effect
no
for
year
and
planning."
outside funds to
in
y e a r
-
such, have had
alone three
dollars for capital in¬
since the end of World
substantial
Furnishes information regarding Gen¬
Stock Purchase Plan. Points out
"stock market fluctuations,
The
States
War II. This is in addition to very
automobile
entered upon an expansion program and has recently decided
to seek further outside capital. Giyes estimates of the nation's
eral
United
half billion
vestment
After
the
Straus, Blosser Co.
offer.
earnings abroad.
When
Into the
which
and
anticipate will be financed out
we
11
made
number
common
purchases
in
viewed
1955
with
of
General
shares traded
Merrill
of
until
the
were
had re¬
Securities
our public offering.
discussion with the
Commission,
we
commenced
stock buying on January 7 but
continued only through January
28, ten days prior to the date the
offering became effective. Pur¬
a
chases
were
March 10, the
resumed
again
Almstedt Brothers
A. C. Allyn and Company
v
Stein Bros. & Boyce
on
third day after the
Central Republic Company
(Incorporated)
Incorporated
and
of
Following
Lynch, Pierce, Fenner & Beane
stock
we
Exchange Commission the matter
of making such purchases during
the period
J. J. B. Billiard & Son
Blyth & Co., Inc.
on
Berwyn T. Moore & Company, Ine>>
The Kentucky Company
Goodbody & Co.
Security & Bond Company
Wagner, Reid and Ebinger, Inc.
F. L. Dupree &
Co,.
W. L. Lyons & Co.
O'Neal, Alden & Co., Inc»\
The Bankers Bond Co., Incv
Russell, Long & Company
Smart, Clowes & Oswald, Inc.
March
29,1955
'
^
12
The Commercial and Financial Chronicle
(1504)
Thursday, March 31, 1955
...
More Sales Promotion for
Automobile Instalment Credit
I The
challenge facing the auto¬
mobile
instalment
credit, industry
today simply stated is Vto provide
credit
-
to
'
—
'"
all
qualified
buyers
car
and
'
i
a
time
t
n
time-t
3 a-
a
es
t-e d
fundamentals
of
credit,
t-e-n
i
s
ex-
o n—
those: stand¬
which
ards
have
proven
soundness
the
financing
this
during
past half-cen¬
L.
Robert
tury."
Oare
rather
This
simple
state¬
of
challenge
ment of the underlying purpose
industry becomes a
of
because
wnich have
of
number
a
building
been
with increasing intensity dur¬
up
ing recent months and which will
test the mettle of each individual
in this field if it is suc¬
grantor
cessfully met.
not
automobile instalment
of
amount
cre'dit
outstanding
States
increased
million to
billion.
the United
in
from
of eight
faced with
span
a
industry was
of
task
continuous
mere
a
total of $10,341
a
Thus, for
years uur
the
rapidly
capacity
to meet
the needs of time sales buyers in
its
expanding
Under these condi¬
country.
our
each individual grantor in
this field could, and in most in¬
tions,
stances
did, enjoy
a very
healthy
the
In
long
was
measure
our
of
obtain
to
allocate
or
tant
that I
This
that
leveled
off both
of business
and
A
face
and
will
be
public
the
for
leveled
off
the
past year, three
significant things occurred which
this
have
to
were
fect
the
on
ef¬
considerable
a
which
in
manner
grantors were to meet their
increased competition.
First, the
automobile
did
not
its
reach
1953, and
price
the
started
volume
of
way
our
mists
the
tomed
was
portionate
increase
to
share
of
his
rate
business.
for
In
individual
many
creased
their
that
was
paper,
address
ticrtral
the
'
Instalment*
American
Louis,
by
Mo.,
Mr. Oare
Credit
Bankers
March
22,
at
pro¬
fect
caused
the
the
Association,
1955,
St.
in¬
of
government spend¬
income
nation's
nation's
started to
timistic
people.
our
or
r
seriously af¬
price
This
structure.
quarter, 1954,
again
economy
expand; and
view
was
had
industry in
noticeable
Nadf
production
reduction
by
and
susbtantiated
in
During the fourth
* in¬
"Conference
national
for the third
well
decline
this
consumer
will¬
the
gross
$367 billion
pretty
lection
*An
of
ing; but, significantly, it did not
the amount of disposable
competition
so
the
re¬
period
a
reduce
ingness to handle automobile in¬
stalment
of
ventories
addition,
and
year,
econo¬
inventory
During
a
seems
total
grantors
capacity
"an
some
quarter, 1953, to $355 bililon dur¬
ing the third quarter of 1954.
It
This
led
inevitably to
sharp increase in the competi¬
tion
what
product declined from an annual
market.
a
termed
about
back
accus¬
the
from
cession."
incoming business, the
an individual
become
end of 1954,
nation's economy had just re¬
covered
in which
had
the
Secondly, by
outstandings
slight decline in the
he
first
competition for automobile paper.
grantor could continue the growth
which
the
grantors to relax credit terms as
means of meeting the increased
credit
a
for
a
the total amount of all automobile
with
re¬
peak
months. This
resultant
improvement
in
the
loss to liquidation experience un¬
questionably has influenced many
effects resulting from
instalment
on
dur¬
1954, and then
a
decline
t.o
result,
a
time in many, many
With this leveling off in
1952.
As
taken
loss
ing the spring of
substantially
lifting of Regulation W
average
time.
possessions reached
the
until
fairly stable used-car
has been in ef¬
a
since that
a very op¬
taken
an
by
most
effect
that there
improvement
in
was
a
in
col¬
experience, but this
very
condition in turn has had
effect toward
some
relaxing credit
tension policies.
Board
(Indiana)
colored
tend to conceal
and often
the true terms of the deal.
ing
for
own
my
unusual
not
for
Speak¬
it
company,
some
of
is
our
condemning the practice of "taking
should avoid seeking
we
healthy
Someone
danger- of
economic
hour
said
has
recovery.
in
we're
becoming a nation of
hypochondriacs—taking
economic
our
temperature
the
on
every
isn't-
it
ex¬
blindly
ment
we've
level
consider
As
the
nor¬
oil
tal
a
economy
as
whole
has
in
been
goal of
Robert E. Wilson
three
very
fining
high as 40 to 50% of the business
being offered.. I am sure that
many of you here today are hav¬
ing similar
experience
in
this
respect.
brief
and
emergency
internal
external
pres¬
industry.
first to what is happening to
sures
having
are
Look
rates.
Unlike
for the
who
and
on
part has
tablished cost for his
an
es¬
product and
thereby
canfairly
accurately
gauge his "break even" point, the
grantor of consumer credit must
set a rate today which will pro¬
vide
a
deal
income sufficient to
of acquiring the
the cost of carrying and
gross
the
cover
and
cost
dustry
realize
can
such
things
and
credit losses may rapidly increase
and cause an unexpected strain on
cover
such
expenses.
margins of profit are
considerably
narrower,
which
leaves
very
little
leeway
for
Today
further
an
reduction
instalment
in
sales
rates.' When
credit
opera¬
is
tion
being conducted as a de¬
partment of a large credit institu¬
tion such as a commercial bank,
it is important that all operating
costs
be
properly
allocated
in
determining the profits of such
department and in determining
the adequacy of the rates used.
This not only means all direct op¬
erating expenses, but also a fair
allocation of management costs, a
realistic cost of money employed,
and
an
adequate loss provision
which
can
be
reasonably
ex¬
pected to
the liquidation of
cover
the receivables.
the privilege
in the manage¬
ment
of a bank, I am familiar
with the practice of commercial
banks to adjust their rate of in¬
terest to fit the credit standing of
the borrower. When dealing with
regular
commercial
borrowers,
Since
of
I
being
such
also
have
active
variation
in
interest
entirely in order and is
"built-in"
controls
rate
one
of
is
of the
our
marginal
.or
high
risk
ex¬
Continued
However, I for one, do not want
to
see
"upturn," or po¬
inspired inflation, piled
litically
the
healthy
the
of
top
on
to be experi¬
seems
economy
recovery
be only too
happy to have witnessed the suc¬
cessful halting of a 20-year infla¬
We
encing.
should
as
economists
cians
and
politi¬
unless
the government went into heavy
deficit
financing.
Instead,
the
last
predicted
year
Administration adopted sound fis¬
cal
tax
and
policies, maintained
confidence, and allowed the un¬
derlying vigor of the economy to
bring
through in good shape.
us
of
made last fall
surveys
capital
anticipated
itures
expend¬
business and industry
1955 indicated that they
by
during
vyould be off about 5% from the
high levels of last"-year. How¬
ever, those figures were based on
Estimates
the
and
the
before
made
eral business
new
probably show a
more optimistic figure.
As a mat¬
ter
of
fact, since I wrote the
foregoing, the new Department of
Commerce survey of business ex¬
compiled
will
pectations
shows
of
has
the
of
of
1%
instead
5%.
Evidently
of
increased
combination
consumer
and
out
come
increase
an
decrease
a
spending, growing
fidence,
and
business
expansion
con¬
incentives
the
which
to
were
embodied in last year's tax bill is
proving quite effective in raising
the sights of business men.
Ru¬
(
has
mor
it
that
some
strenuous
price
cutting by
big electrical
companies also helped to step up
some
of
the
utilities
page
34
available
this
it
another
is
constructive
does
not
round
cumulation
or
run
of
inventory
into
ac¬
inflationary
new
labor leaders
Cheap mortgage
pro¬
away
programs such as some
and
are
politicians
talk
cussion
Boom?"
moment's
a
think
I
by Mr. Wilson
on
at
"1955:
the
advocating.
is already
at
a
panel
dis¬
Mild
357th
Industrial
notice in
indus¬
our
try might be better off, and still
full duty
our
ernment
and
relaxed
we
by both
in
bit
a
our gov¬
customers,
our
outlays and in inventory
lation, at least until
what
ter
imports
regulation
industry
this
is
company
accumu¬
know bet¬
we
and
price
gas
going to do to
are
year.
our
Our
•
definitely
especially
if
capital
new
such
on
in
own
a
refining.
construction of interstate gas
pipelines
will
wildcatting
or
certainly not
scale
of;. recent
producer
from
time
fact
the
the
until
years
unprecedented
price
5,000
the
relief
peace¬
which
controls
been forced
the
gas
on
anticipate
can
the
for
resume
have
him, in spite of
competition among
upon
that
independent
producers
has kept the field price of gas the
cheapest of all fuels;
situation
session
for
is
of
modity
Congress,
producer
any
in
and
if this
remedied
not
general
by this
bodes ill
it
of
any
com¬
use.
New duPont Branch
SAN
ing
DIEGO, Calif.—The
open¬
of
an
office in San Diego,
Calif., in the San Diego Trust &
Savings Building, was announced
by Francis I. duPont & Co., mem¬
bers of
the
New
change,, Los
York
Angeles
Stock Ex¬
Stock; Ex¬
change, San Francisco Stock Ex¬
change and other leading security
and
commodity
is the firm's
fornia.
exchanges.
This
eighth office in Cali¬
Others
located
are
in
Los
Angeles, San Francisco, Sac¬
ramento, Fresno, Pasadena, Bakersfield and Beverly Hills.
Francis
duPont
I.
maintains 63
&
domestic
Co.
has
and
London
overseas
now
offices, in¬
cluding 12 in the New York
area,
branches
in
Lausanne.
and
to
Staff
(Special to The Financial Chronicle)
BOSTON, Mass.
Seligman
staff
State
of
has
B.
C.
Street.
been
Morton
He
—
Leonard
added
&
was
to
the
Co., 131
formerly
with Keller & Co.
money
overstimuiating housing construcA
at
need.
of
case
Morton Adds
All
most; de¬
expansion
plans.
vided
government
industries,
we
are
also
carrying our own stock¬
piles—too
big,
in my
opinion,
considering the excess producing
and
refining .capacity which is
gen¬
upturn late last fall,
surveys now being
the
.Unlike
largely
program,
some
that
re¬
possible
a
for, and has done it at its
expense.
trend
without
being,
"The
plunged into a deflationary spiral
tionary
for
fense.
new
any
capacity
asked
own
do
tries.
National
on
important indus¬
free
enterprise system which tends to
keep, the
past
surprising
with
—
in several
vigor
Various
during
the
1930s
only too well how
as
collection
costs
the income deferred to
months
the
for
again
upgrade
fdur
con¬
consumer
or
We have clearly been on
fidence.
the
significant
involved
none
loss of business
manufacturer
the
most
our
readjustments at about
five-year intervals—one immedi¬
ately postwar, one in 1949, and
one last year.
All were moderate
necessary
producing and
excess
branches to be forced to reject as
and
Ij for
1955.
Our industry has surpassed every
witii
years
a
would be just as .happy if we
not
enjoy that distinction.
did
for
15
show
shrvey- to
expenditures for
nne,
an
uptrend
"•
-
capital
slight uptrend in projected, capi¬
the
that
where ;r£ally
; '. r;; r
McGraw-Hill
facts
The
more * govern¬
expenditure^ by
industry, it was...the-only_
industry
in / last;,'Jail's"
to.
major
mal.
are
spend
or
moneyi except
necessary-.^
.to
come
further
a
,
at "ihe
actly
pressing, but this means
of; public debt * above
present high levels.• It is :certainly ,no timer to •» rush ahead
and
hour,
tion, and consumer debt, is again
growing. - Thre
need
for
many
more ''roads.,and
schools seems
increase
-
worrying^, if
now
trended
cars
structure
fect
end of that year due to the
carry-over.
to
trade-irjs
tract. Overallowances on
liquidating the contract
to
its
maturity, and provide a reason¬
downward.
The
reduction
in
able profit for his endeavors.
To
new-car
prices principally took
guide him in setting a price for
the form of increased allowances
his service, he has the benefit of
on trade-ins
and actual cash dis¬
his current
operating costs and
counts.
Prices of used cars were
liquidating experience tempered
forced down proportionately. This
by
the experience of previous
downward slide in prices slowed
years. Those who recall the con¬
down considerably by the end of
ditions which confronted this in¬
used
and
new
credit
peak
defin-
reverted to a "buyers' mar¬
ket."
As production of new au¬
tomobiles
approached and then
exceeded demand, prices of both
the
While
had
industry
itly
during most of 1953,
of outstanding credit
amount
only
it
instances,
up
Buyer's Market in Automobiles
During
the amount
to
outstanding credit.
and
Iir
selling terms.
the only
these
to the volume
as
as
volume of credit had
in
prospects,
finding
are
The Narrowing Margin of
to this com¬
Financing Rates
petition intelligently rather than
blindly and blithely go merrily
Let
us
examine a little more
on our way acquiring volume.
closely some of the effects which
to
instalment
automobile
the
not
the industry an¬
in
we
this
But it is impor¬
serve.
we
alyze
handle a
greater volume of business. Dur¬
ing 1954, for the first time since
World
War II, the
demand for
funds
necessary
very
are
instead
but
better price.
a
run,
and
industry
whom
by the ability or willing¬
individual credit institu¬
of
ease
They
for the stability of
the best thing
tempered in a great
isted, it
tions
and
some
industry to give a better serv¬
public at
the
hour," holds business is on
any new "upturn"
politically inspired inflation which may be piled on a
or
.to
way
ice to the
growth by just retaining his pro¬
portionate share of the available
market.
While competition ex¬
ness
liberalize
credit restrictions.
credit
terms
competition should force us as in¬
dividual grantors and therefore as
an
of
Company
economic temperature every
upgrade again and
every
instalment
that
pattern.
Prominent oil executive,
our
available buyer for
their product is reflecting itself
in tremendous pressure by auto¬
mobile dealers on the grantors of
'
infer
to
mean
American economic
During the period from the close
1945 to the end of 1953, the
$455
find
to
many
of
consider to
proportionate share of the
struggle
be their
deplore this keen are becoming quite common, aqd
competitive climate in which we in numerous instances, are also
with
price„ "packs"
now : operate.
It
is a healthy combined
thing for our industry just as it Through these and other devices,
the financial details of the auto¬
would be true for any other in¬
mobile purchase transactions are
dustry, and is the keystone of our
instalment
of
factors
do
in' any
s a me
m
today
I
Standard Oil
market. This competitive
'
V *'
the
on
would appear
thing that seems to
count is to make the sale regard¬
within our industry today, is at
less of whether the purchaser can
a
very high point, if not at an afford the automobile or meet the
all-time high.
payments on his instalment con¬
extending credit.
in
course
Chairman
a
what they
themselves
market in
automobiles, there is keener competition among dealers and
more sales promotion, thereby contributing to more instalment
selling. Finds the margin of rates charged for financing is
narrowing and warns of the need for maintaining sound credit
principles in automobile financing. Says major problem in the
financing industry today is maintaining sound credit terms, and
hints at threat of government intervention and control.. Lays
sound
is
dividual manufacturers to take for
the increase in automobile instalment credit since
a
By ROBERT E. WILSON*
all the
grim under¬
the part of in¬
Along with
there
lying struggle
1945, Mr. Oare points out, because of the buyer's
down rules for
cars.
new
fanfare,
South Bend, Ind.
Chairman, Associate? investment Company,
.
"Upturn" Or Politically
Inspired Inflation Wanted
Thirdly, the year 1955 has been
ushered in by a record-breaking
sales-promotion effort on the part
of the automobile industry to sell
its
By ROBERT L. OARE*
President, American Finance Conference
After noting
No New
Automobiles
Today's Challenge to
Recovery
or
Meeting of the
Conference
Houston, Texas, March 24, 1955.
Board,
With
Palmer, Pollacchi
(Special to Tht Financial Chronicle)
•.
BOSTON, Mass. —5 Sumner H.
.
Wood row
is
'with
Palmer,
lacchi & Co., 84 State Street.
Pol¬
Volume
Numbed
181
5416
.
.
The Commercial and Financial Chronicle
.
(1505)
13
r
A Life Insurance
Company
the Equity Markets
Looks at
(B) A comparatively high his¬
level of stock prices.
in
Up to the Legislation
(1) the
liberal yield
more
life
prior
of
stocks, Mr. Silloway lists
change in this attitude as:
a
sound equities;
on
tively good experience of investors with
clearer
of
attitude
common
influencing
the
companies
discussing the historical unfavorable
insurance companies toward
the principal factors
recognition that life
companies
fixed
•
income
securities
are
insufficient for
the
not
was
a
are
as
forthcoming.
The
on
perience
liberal
sound
In
Toward Common Stocks
or
early history of life in¬
surance, the industry's investment
policies were to invest primarily
in secured
obligations.
vestments
Equity in¬
in
t
which
for
considerable
a
This
borne
was
by
generally
ited
insurance
of
their
make
ad¬
assets,
n v e s
ted
1890.
in
Silloway
common
The
vestments
The
included
acquisition
continued
from
that
in
of such
companies,
the
total
holdings
aspects
It
States
holdings
of
that
ings
York
28%,
of total
total
stocks,
assets.
common
stock hold¬
to
and
to
of
stocks represented
common
about
0.9%
of
admitted
1951,
the
legislature
New
of
York
of
the
amended
the
therein
have
to
the lesser of 3% of admitted assets
life
of
The
stocks.
common
insurance
great influence
ment decisions of
vestments
on the invest¬
companies dom¬
of
holdings of
both
com¬
and preferred stocks followed
mon
thp. investigation,- reaching
low
of admitted assets
point of 0.6%
a
only in
securities
.
Preferred
of
n
Stock
New
Legislation
York
the
passed
legislation
necessary
to
_
permit
companies domiciled in New York
purchase
to
preferred
stocks
of
corporations meeting certain earn¬
As a result of the pas¬
ings tests.
of this legislation, the com¬
bined holdings of preferred and
sage
common
stocks
in
life
insurance
companies again started to expand
and
of
*
by 1929 had reached a figure
2.4%
Outline
:fore
the
rence
:Kool
ark
clearer
that
recognition
life
companies
of
are
long-term investors because
flow
belief that they can afford
a
temporary
long-term
market
concentrate
and
yields.
The
on
favorable
experiences
cited
widespread
application
led
to
more
the
of
"prudent man" concept of invest¬
which
ment
in
in
been
widely
fund
trust
ap¬
investment
Meanwhile, pension funds
also
were
has
investing
stocks
common
of
of
of
admitted
remarks
by
assets.
Mr.
The
Silloway
Dean's
New
Day Homecoming ConYork University
Graduate
Business
City,-March
relation
fixea-
mortgages
given period has been
the
to
institutionalized
volume
savings.
increasingly
with
effective
The
a
(D)
which
The
more
the
of
widespread
Administration,
1Z,:
1955.
New
on
than
in
ous
built-in
the
ac¬
past because of vari¬
stabilizers
positive
Federal
attitude
Government
maintenance
of
and
a
the
by
the
toward
satisfactory
a
level of employment, national
and
It
power.
an
with
eye
age
to
turns
seems
election
in¬
purchasing
consumer
clear
from
the
subsequent
and
of
governmental philosophy
rates
the companies
liberal
more
This
announcement
is neither
Not
a
will increase their
As
of
Dec.
31,
1954,
companies
York
held
admitted
of
tal
admitted
present
assets.
lion.
Under
of
assets
at
amount to $912 mil¬
relationship does not
evenly on all companies as
of the New York companies
some
have made
virtually no purchases
stocks, and there is
common
no
disposition at the
r
figures
also
The
mitted
opportunity
to
immediately.
One
by
the
New
York
companies
was
passed
vest
\in
opportunities
fixed-income
have (been
they
had
previously.
been
the
risen
.47%.
to
mons
is
market
centage on
value,
that basis
for
surplus
many
problem
York
New
of
result
the
recent
I
believe that two main
there
that
an
even
largely
sence
of
barrier
responsible for the
a
great rush from
by
the
New
York
Stocks in the Future?
can
be obtained.
With Investors Realty
As their experience widens and
a
longer
without
period
of
important
time
companies
to
continue
(Special to The Financial Chronicle)
passes
economic
to
LOS
ad¬
versity
and
consequent
market
decline, it is logical to expect the
buy
Katz
have
ANGELES, Calif.
T.
man
Johnson,
and
Realty
their over-all
previously
percentage
such
in
securities.
companies
are
investors
in
fixed
Fund.
Miller.
&
Traditionally, the life insurance
Patrick
(A)
an
offer to sell
nor a
solicitation of
The offer is made only by
Kenney
W.
Mr.
with
buy
to
•
.
.-
Mr.
-were
Johnson
Katz
and
with
any
of these shares.
the Prospectus.
1
•
i
accord
ab¬
the
com¬
hazard Frcres & Co.
between
Based
on
49
companies
assets.
having
Harrimaii
Ripley & Co.
Incorporated
the
March SO. 1953.
Treasury and the Federal Reserve.
of industry
obtainable from such of the several under-
writers, including the undersigned, as arc registered dealers in this state.
Rise in interest rates which
so-called
are
92%
'
I
;
Nor¬
M.
McKenney
Jones,
Weston & Co.
offer
an
—
Benjamin,
joined the staff of Investors
equities and probably to increase
Copies of the Prospectus
began in spring of 1951 following
a
Attitude Toward Common
as
panies:
be
broader margin for equity
investments
What May Be the Life of Insurance
Price $58.75 Per Share
I
will
tendency for the companies to in¬
vest up to their maximum, and I
am
hopeful that before too long
prosper.
,
reasons are
ten
and
business. However,
longer range point of view,
a
believe
un¬
rise.
aris¬
companies writing
on
per¬
doubtedly be somewhat higher
than
years
participating
from
and
grow
by
other States
com¬
the
in¬
Another deterrent has
valuation
Since
would
to
securities
favorable
more
been
years
the admitted asset value for
in
has been that since the legislation
interesting:
has
centage
reason
their purchasing of common stocks
Common Stock, $5 Par Value
1952, .22%
and 1953, .27%. We do not as yet
have
comparable data for 1954.
On a book value basis, the per¬
per¬
for the relatively slow start made
correspond¬
succeeding
for
•
mo¬
the maximium amount
go to
Corning Glass Works
1951,
no
the
admitted'
This
fall
of
3%
statute,
464,700 Shares
indicating that
particular rush on
was
New
common
having a book value of $142
million, representing 0.47% of to¬
.16%
was
the
stocks
New Issue
holdings of
re¬
holdings.
better-than-aver-
a
if
available
are
by investing
in sound equities, it is
likely that
in companies which
have
stocks,
market
and, conversely, in periods of low
toward
relatively
a
yield and expectation
yield in the fu.urc
by investing
events, if in fact it was not clear
prior thereto, that such an atti¬
tude
been
has
with
quality
the
in-, ing in part from the legal limita¬
tions imposed on accumulation of
and
of
improved
seem
again withdraw from
national
a
companies
legislation.
new
1
done
buyers
present
on
amount
however,
be
low current
that our
economy may be somewhat more
depression-resistant in the future
1952
company
fixed
eyes
modest
A
vesdng,
feeling
the companies to make use of the
the
insurance
yield.
of
requires earning a
return,
and
current
their
common
were
total
end
there
a
most
have
influenced
been
After all, the life insur¬
stipulated
on
ment for any of the companies to
by yield consistent
satisfactory
degree
of
business
ance
make
likely that the companies will
probably
part
a
quality.
good
it is
V
ceptance
the
company
stock
common
their
the
large
with
will
that available
general, the decisions of the
have
to
income-bearing investments
in sound corporations at a rate of
return
that
very
nearly equals
amendment
of
listed
24 New York
of
In
companies
results.
exchange.
are
.
the Legislature of the
1928,
State
-
which
and
ing
in.1924.
In
experi¬
long-term hold¬
•
assets
iciled in other States, and a steady
decline
small
of
and
If the oppor¬
present
quite restrictive in character
permitted common stock in¬
other
still is concentrated, had
and
quantity
securities
in
stocks.
common
assets would
a
investment
fluctuations
one-third of surplus invested in
or
'
a
num¬
a
the
investment
to dispose of their holdings.
portion
was
income
of
fu¬
ana
Recognition of the fact that
times
issued in
*,
influence
earnings
IV
disregard
eligible for purchase by life com¬
This statute, which was absolutely panies
and
which had met an
binding upon companies domiciled earnings test and paid a dividend
in New York, in which a large on its common capital for 10 years
years
as
invest¬
the stability of their cash
more
3.3%,
investment statute to permit com¬
period of
a
the
of admitted
panies domiciled
and
given
of
come,
State
was
were
21%
in
increased
or
In
no
ferred, and
ac¬
assets.
cer¬
were
had
which
of
permitted
to
invest
in
either common or pre¬
stocks,
the
By the end of 1950, the combined
result, life insurance companies
New
to
preferred and
life insurance companies
in
rather
made
toward
included
about 0.5%
or
and other financial institutions. As
longer
had
starts
industry had combined
holdings of 2.7% of total
stock
clear
was
investigation
domiciled
companies to
admitted assets, and common stock
malpractices had appeared in
the stock dealings of certain
of
the companies and that dangerous,
interlocking relationships existed
a
permitted
By the end of 1947, the life in¬
tain
between
the
and
ideal
surance
conducted
legal
investments.
that
addition,,
assumed
fact
plied
by the late Charles Evans Hughes,
brought
about
an
important
in
States
investments, and by
companies located in
time,
amounted
change
domi¬
the
policy.
The Armstrong Investigation
stock
In
hypothetical
A
ings.
in 1903.
insurance
certain
in
(C)
cumulation of common stock hold¬
in¬
peak of 7.3% of admitted assets
a
of
(F)
at
•
ings.
preferred
increase and reached
to
for
our
values.
made
on
stock
and
common
mostly rail and bank stocks.
were
im¬
passed
fact, by the end
33
insurance
aggressive
of
were
Columbia
such
several
all
of
kinds both
in
that
F.
Stuart
of
life
signs
permitting lim¬
In
some
District
ap¬
proximately
i
of
studies
ence
companies
therein.
1950
3.9%
stocks
those
economy
stock investments by
common
ciled
"of
States
busi¬
as
our
statutes
in various
life
and
showed
provement,
did, how¬
have a
i g n i ficant
mitted
com¬
likely
corporate
equity
acquisitions
trusts,
fire/and
casualty
companies,
and
life
insurance
ber
opportunties
of
abroad, conditions which
very
ture
an
ment
companies.
realization
satisfactory
Subsequently,
recovered
ness
nies
of
and
would
period of
out
fairly protracted periods,
as
long-term
here and
were
and
interest
greater
by the life insur¬
ance
industry
(when
seeking Types of Common Stocks Pur¬
chased by Life Insurance Cos.
changes in the law) evidenced a
ever,
y,
are
ceedings.
the rule.
mo n e
statute
present
in part out of reorganization pro¬
ex¬
amount
,
Following the depression of the
30's, there was an increase
the holdings of stocks by life
insurance companies which arose
The- compa¬
s
holdings
over
York /well
substan¬
a
early
ception rather
than
directly
New
tial portion of the. industry.
erprises
the
the
•
transportation
were
subject
to
in
industrial and
e n
companies
indirectly
statute constituted such
the
the
on
inflation
the resultant further improvement
in
the
standard of
living, both
good
ex¬
-equity investors
pany
stocks
are,
mild
a
through
research
and
technological advances and from
equities.
examination of certain trust
preferred
implications,
and
between
yields
on
bonus
and
mortgages and on preferred stocks
tunity is'again
shares
least,
although
The
securities
they will be'' in¬
fluenced importantly by the spread
and
fixed
have
economy
relatively
vestment
in
the
mortgages,
objectives
these
the
(E)
yield
preponderance (73%).1 of that in¬
ance
seek¬
had in common stocks which
held
was
and
expansion and development of
more
(B) The
time.
since
monetary
at
under
follows:
available
volume of
of
The
hedge,
the
permissive
holdings for New York companies
unanimous opin¬
a
Act
income-bearing
be employed to
may
common
so-
books.
inflationary
record
liberalization of the statute
(A)
institutionalized savings.
Historical Attitude of Life Insur¬
and
be
the
small.
ing
and (6) recognition of the fact that,
economy,
such
The principal reasons for
investors; (4) the widespread acceptance that the econ¬
omy has become more depression resistant; (5) the greater
realization of the long-term
opportunities for a developing
expanding
years
urged the adoption
legislation and felt that
political
would
not
the
devices,
certain
York
several
for
New
it
or
Employment
on
implement
ion.
stock; (3)
ideal long-
are
had
the
Full
fiscal, which
thereto
This
(2) the rela¬
common
of
it was rather slow in
term
and
number
that
were
various
Common Stocks Leading
A
major
whether
1946
.
Company of New York
both
and
called
Principal Factors Influencing the
Change in Attitude Toward
Vice-President for Finance
The Mutual Life Insurance
in
parties
present
By STUART F. SILLOWAY*
After
exists
torical
was
Cosgrove
Mr.
Mc¬
Daniel <;D.
14
level
of
official
Important Aspects oi the Market
prices that caused
The short seller
be
to
contributor
a
and
condition
undesirable
this
to
stock
concern.
assumed
was
By F. EBERSTADT*
severely criticized.
Rather
stringent
restrictions
on
short
selling were introduced. It may
be that conditions have changed
was
Partner, F. Eberstadt
President
Co., Investment Bankers
&
Chemical Fund, Inc.
oi
Mr. Eberstadt maintains that in spite of competent supervision
by the
dangerous
authorities,
speculative
proclivities
sufficiently
have
the market.
deal
as
market.
More
whole, they be adjusted' to individual stocks, to
isolated
without
situations
of
Favors relaxation
riot
effect
Feb.
17, 1955, we replied to
Committee's
questionnaire,
your
dated Feb.
to
responses
find
to
no
I have reviewed our
1.
inquiries
your
and
is
have
had
forces
reason
have
modify
them.
There
is
min d
my
that
the
during the last
in
months
Furthermore,
1954 and
in
of
not
minds "of
investors.
many
purchasers with
new
large resources have come into the
early
market.
1955, influ¬
ences
these
as
The possible ef¬
fect of these inflationary forces on
the stability of the dollar makes
stocks seem preferable to bonds
no
in
long
so
of stocks.
price
doubt
and,
prevail, will continue to
stimulating effect on the
a
Another
upward
potent
force is the outlook for the future.
en¬
So
far
and
most
of the
these
securities
time.
There is wide confidence in
markets
the President and in the
state
There is
or
with
increasing
Creating
iOrce,
Eberstadt
Ferdinand
some
Congress.
a growing belief, whether
justified, that as
time
not
or
for
been
a
number
of
passes, the foreign situation is be¬
situations, the cumulative effect coming less dangerous. Above all,
there is feeling that the
of
which,
if
continued
unre¬
epochal
strained, was likely to be un¬ discoveries of our scientists in the
wholesome. There was a rash of atomic, the electronic,
and the
security
offerings
experienced
the
to
looked unpromis¬
eye
Certain
ing.
which
listed
stocks
were
being given quite "a ride." "Hot
tips" were becoming the basis for
chemical
fields
have
opened
the
doors to industrial progress, with
resulting benefits to man'i health
and
wealth, beyond anything that
was
achieved
ever
somg^ feverish stock buying. Ex¬
perience indicates that such prac¬
tices may prove disastrous to their
victims with injurious repercus¬
tends
or
posite
these
of
to
create
even
The
dreamed of in the past.
com¬
forces
naturally
strong
a
market.
And so, one would be rash to say,
without qualification or specifica¬
and
becomes
vigor
and
matter of
a
the
on
lies
than in
part
expressions by Federal
authorities
worthlessness
such
of
I
on
who
many
directly
1
I would like to say at the outset
that
during
have
the
followed
35
the
curity markets, I know of
when
the
markets
supervision
in
was
of
I
nub
of
you
are
duly
high
to
in¬
in this statement the
SEC,
NASD, and the two stock ex¬
changes with which I am familiar,
namely, the New York Stock Ex¬
change and the American Stock
Exchange. I am sure that the un¬
the
desirable practices and tendencies
that
I
referred
to
above
have
approved
by these authorities.
equally
am
inquiry as you
timely and has
The
very
ducting
had
a
that such
sure
conducting is
are
useful
a
.an
fact that
you
purpose.
are
con¬
the
inquiry has already
distinctly perceptible de¬
terrent
effect
these
on
practices.
market,
Market Appraisal
The
testimony
Committee
given
to
your
to whether the stock
as
market in general is or is not too
high
leaves
tused.
somewhat
That is not
peculiar
came
one
would
almost
this
to
any
con¬
phenomenon
a
The
moment.
probably be true at
other time. The fact
that
some
think certain stocks
foo
high
and
fire
too
low
that makes
others
is
a
one
think
of
market.
the
are
they
things
Numerically
in comparison with 1929 the stock
market level may seem high but
even
if it
little.
We
that would prove
were
dealing in a differ*ent unit of currency than we were
in 1929—a 100% gold dollar then
i nd
the equivalent of a 600 gold
are
Collar today. Prices of other com¬
modities and services
have
re¬
flected
this
extent
stock
difference.
To
what
prices have done
NASD
has
done
*Statement
by
Mr.
.
17,
joate, March
1955.
V
■
•
requirements
The
reciprocal
the
one
hand and busi¬
activity and profits on the
other, is so close and so sensitive
ness
that
an undue general increase in
margin requirements might affect
both' the former and the
the
disadvantage of
latter to
our economy,
without necessarily
curing the un¬
practices to which I have
referred and
merit your
which, in my opinion,
Committee's astute at¬
tention. If these harmful practices
can
be isolated and dealt with in¬
dividually, that would
to be
seem
a
more
desirable course than to
resort to action which might have
generally
depressing
effect
is my
must
am
be
not
dealt
sure
sufficiently
as
a
customers
properly
authenticated
balance
sheets
statements
request
on
current
operating
and
jected
enjoy
equal
stocks.
curities
is
they
and,
parison, the abuses
be
to
few
so
and
with, that I have
the
to
wisdom
securities
to
the
about
doubts as
attempting to
whole.
flexible
It
in
bearing in
of these
would
present
seem
to
available
always
mind that it is
prob¬
have
unless
we
ingredient of
strong
a
businesses
and
from
started
new
year
to
is likely to
retrogress or to fall in the hands
of industrial giants.
year,
I
our
economy
not
greatly
concerned
about the tipster.
Public knowl¬
edge of the losses which are sure
am
follow habitual
to
as
pursuit of tips
investment
an
likely to take
standard
are
of this abuse.
care
consideration the possibility
of empowering the proper author¬
ities with the
right to raise margin
requirements on any specific stock
on
a
showing tliat such action is
in the public interest. This would
enable the authorities to deal with
isolated
situations
without
de¬
pressing
the
whole.
stock
market
as
a
<
LOS
First
has
market
many
was
years
one
a
of the stabiliz¬
strongly
short selling.
ago,
it
was
rising
Not so
the low
California
Spring
recently
Realty
been
Fund,
thereto
was
Company,
Street.
Mr.
with Investors
Inc.
with
647
and
Marache,
prior
Dof-
t
had
have
fore
back upon
maintenance.
fall
to
for
families
their
workers have
Many older textile
turned
been
from the
away
em¬
ployment offices by other em¬
ployers and have found them¬
selves "too old to work and too
to retire."
young
LOS
M.
We
urge
great an
inclination
to
ourselves
concern
global figures and over¬
the individual deficiencies in
the
This
economy.
our
^
failure to
and the
weaknesses
areas can be
the
analyze
shrinking
as
fata)
twenties
We know that the troubles of th*
it
as
now
the
in
was
ANGELES, Calif.—Donald
become
Shearson,
South
Grand
formerly
associated
Hammill
&.
Avenue.
with
Both
Paine,
Jackson & Curtis.
Co.,
with
520
998,000 compared with 980,000 in
June and
August 1954.
therefore
not
covery
What
be
hai
In
December
during
the
the
twenS^s
were
Had
us
then addressed
we
we
precursors
befell
that
disaster
part
latter
of thcof tht
in
1929.
ourselves/
urging you to focus
the problems of the
are
upon
areas
indus'.ries
and
we
hours
the
early thirties.
of
The need for such
dustrial
far-reaching
by
Organizations,
the New York
editorial
clared
as
on
an
which
investigat on at
an
as
"Times," which, in
June
7, 1954, de¬
follows:
"The textile unions have
sought
to
cooperate in
increasing the
efficiency of the industry and the
productivity of its workers. But
♦From
fore
on
the
the
a
statement
Joint
per
week
during April.
The
shrinkage in employment
place in all regidns of
country. Attached is a com¬
taken
both
in
of
the
and
wage
each
employment of
salaried workers
between
state
and
October
February
1954.
A
total
shrinkage of 283,000 jobs occurred
the
45
months.
(Table I.)
(Employment of salaried and
in
wage
increased
earners
by
some
7,800 from October to December.)
One
hundred
thousand
and
seventeen
jobs were lost to the
during this period in
/industry
New
England, 85,000 in the Mid¬
dle-Atlantic
the South.
saw
a
textile labor organ¬
izations and the Congress for In¬
only
hours
37.1
to
40
had
They
week.
states
and
52,000
in
The largest reductions
in
investigation has been recognized
not
exceeded
year
per
dropped
the average
the first time
for
employment were suffered in
avoided the
depression of the, Massachusetts (58,200)-and Penn¬
sylvania (36,800). North Carolina
might well have
depths
1954,
hours
1951
structure of these industries
happened, however,
welcome, has been
weekly
of the worker which
demoralized the industry and t a
during
1948 has been 282,000
1951, 177,000 persons.
has
parison
wage
President's eco¬
The net
increase in the hours of work.
an
bingers of the oncoming disaster
The
shortages in buying powe>
and the heartless competition a>
the expense
There has
such re¬
suggests.
report
from
any
which is most
those
to
been
the
as
nomic
has
were
Webber,
ers.
the
proved
1,-
low point in 1954
July with 953,000 work¬
Recovery since July has been
The
minor: in December the total was
textile and coal industries durin*
years
about
was
in
and
there is too
total
1952
both
In
1950.
the
1953
100,000.
the Joint Com¬
upon
that
mittee
an
Smalley and Harry B. Turner
from
drop from
*
*
convention, but also by
independent newspaper such
(Special to The Financial Chronicle)
has declined sig¬
the more active
days within the industry. In 1948,
there
were
1,280,000 production
Employment
nificantly
was
called for such
Shearson, Hammill
the
Industry
in
its last
With
Textile
and
Bates
flemyre & Co.
have
past,
forces in
rejoined the staff of
in
Conditions
Distressed
pro¬
unemployment benefits have ex¬
hausted their claims and there¬
problems of economic re¬
habilitation and recovery in them,
ANGELES, Calif.—Robert
South
Short-Selling Situation
ing
bilitated
and the
F. Bates has
get under way."
of
distressed
(Special to The Financial Chronicle)
sooner
can
This number dropped to
now
With First California
the
grams
1,200,000
look
companies,
business
new
a
to
your
re-
remedial
lems,
have
been
industries to
to their basic prob¬
these
in
workers.
in¬
salutary
It is difficult enough now to start
I
be
answers
coun¬
management
with
Tens of thousands
textile workers dependent upon
with
ably not wise to stifle this market.
or
using a mallet to kill a
fly
if,
in ' order
to
restrain
gambling
activities
in
a
few
stocks, margins on ail stocks were
raised. Therefore, I suggest for
me
seek
through¬
Administration
the
employments.
Undoubt¬
listed.
be
these
to me
of
labor
to deal
easy
information
crease
se¬
com¬
restore the prosperity
the mines or the textile mills.
matically
and
the
will auto¬
economy
communi¬
ti.rougn
some
of
be
of
in
appear
so
the
of
number
vast
sub¬
are
that
to
The
so
the public-
nor
which
to
is
listed
a
or
the
in
turn
togetner
many
Barkin
that no general up¬
is clear
"It
sooner
not
Solomon
the South.
in
gels
try have been
hard
hit and
ing licensed dealers to furnish to
their
and
thetics
Tex¬
out
a
imported fabrics, syn¬
non-union producers
from
tion
losing
of competi¬
lace
the
in
been
has
industry
ground
The
the
de velopment
of
alternative
margins
that this is sound
circumstances.
to
stock
with
re¬
h
impression that under
present legislation
has
covered.
as
It
and
yet
1951
not
only suggestion in this field
involves the possibility of requir¬
on
business and yet not result in the
desired cure.
since
state
the
a
in
depressed
My
edly it would
on
industiy
job of policing this huge market
prices
so
Eberstadt before
t le
Hearings on the Stock Market, Comiaittee on Banking and
Currency, U. S.
r
market
simply by
tex-
been
has
excellent
an
force any great quantities
In the
,
un¬
The
t i i e
over-thebelieve the
I
from
suffering
unemployment.
the
to
respect
relationship between stock market
activity and the level of stock
a
|
board.
the
which
an
stock
with
margin
the
sound
I
dealt
with
is not
general
be
that
me
problem
increasing
across
to
concerned
level
I
now.
nor
the
time
clude
neither been fostered
seems
these
no
of
honest and
more
competent hands than
it
se¬
that
years
course
Thus
localities
Re¬
industries
some
ties
ter securities
Competent
and
serious
of
ities.
scrutiny
Supervision Honest and
speaks
securi¬
qualified pros¬
pectus with respect to such se¬
curities which they sell. Neither
the publicity that over-the-coun¬
tion, that the general market level
port
or
The Wide Implications of Margins
not
are
involved.
Economic
President's
vesting prohibitory powers against
such issues in the public author¬
With
by the textile depression.
given to workers victimized
ance
The
tile
counter
granting con¬
Wants special assist¬
piles for armed forces, and (4)
mills in distressed areas.
recommend
would
Nor
ties.
remedial measures:
as
of textile stock
value
the
to
as
increased productivity
as
tracts to textile
rather
disclosure
full
in
well
(1) distribution of textiles to needy nations overseas; (2) dis¬
tribution of clothing to domestic needy; (3) reestablishment
oughly unsound. I believe that the
cure
as
Proposes
advances.
in
is too high.
sion
due to technical
such
have
we
nationally
our
they
have
con¬
public authorities.' With
respect
to
those
issues
which,
while not fraudulent, are
thor¬
of
than
the
are
states, elimination of
frauds
vigilance
entered
confident
think
I
books
our
on
Investors
more
frauds
consumer
general business contraction,
protecting the fool from the knave
is not new to our jurisprudence.
Assuming adequate penal legisla¬
tirely salutary
seem
Crux
cerned, it seems to me that they
are
in the some category as any
other
frauds.
The
problem
of
tion,
(4) changing
expenditures; (5) tardiness in meeting
trends; (6) inter-fibre competi.ion, and (7)
pattern of consumer
the
stock
as
plight of textile workers and
Gives data on unem¬
(3) changes in types of garments;
markets;
same
new
Furthermore, there
have been, and. are, tremendous
inflationary forces at large which
question.
a
the
have
to
as
America
ployment in the textile field and abscribes causes of present
condition to: (1) loss of domestic outlets; (2) loss of export
the buyer.
on
Disclosure
On
Trade union economist describes
technically fraudulent, are so
worthless
disclosure;
against background of existing penal legislation.
Department,
the distressed conditions in the industry.
security frauds
are
BARKIN*
Textile Workers Union of
and sales of securities which, while
of
importance
level
1955
a
disturbing than the present
market
depressing the general
short-selling restrictions under
Emphasizes
conditions.
present
By SOLOMON
Director, Research
step might increase the market's
stability and underlying strength.
Suggests instead of dealing with margin require¬
a
with
Such
Thursday, March 31,
...
Depression in the Textile
Industiy and the Way Out
modifying
justify
to
of these restrictions.
some
emerged, harboring wide repercussions both inside and outside
ments
Chronicle
The Commercial and Financial
I
(1506)
by Mr. Barkin be¬
Congressional Committee
Economic Report.
of
shrinkage
a
20,000.
could
in
employment
No single textile
report
increase
an
s!ate
in
em¬
ployment between February 1951
and October 1954.
As
textile
mills
are
generally
located in non-metropolitan areas,
frequently comprising one-indus¬
try
or
one-mill
ternative
locality
communities, al¬
employments in the
are
lacking. The slump in
textile employment therefore
presses
entire
communities
de¬
and
leaves workers and their families
stranded.
The
significance of this
concentration is borne out by the
fact
that five
of the eight major
Continued
on
page
38
Volume 181
Number 5416
.
.
.
The Commercial and Financial Chronicle
(1507)
86.55%
of
shares
in
News About Banks
the
favor
At
the
BRANCHES
NEW
OFFICERS, ETC.
Bankers
and
REVISED
CAPITALIZATIONS
Wall
83.67%
shares
pany
City
the
Bank
The
of
First
City
of
York
National
New
of
merger
.the
New
the
of
name
Bank
York
of
the
approved
two
The
of
and
banks
First
a
under
National
City Bank of New York.
Following
N
11
a
approval
by
the
al City shareholders
o n
^y ,a vote
Ann »
?» or 82.8% of the 10,VS°i2° 0ShareS outstanding, to
17,033. Shareholders of
oSf
o
ooo
nnn
j
First
Na-
^y .f
of its
s
the
New
of
total
Manhattan
York
has
acquired
the
of
assets
Com-
Bronx
County Trust Company and
as
March
the
Bronx
(New
City) institution became
the
Bank
of
of
part of
a
Manhattan's
city-
banking system, it was announced in a joint statement by
Lawrence C. Marshall, President
0f
Bank'of
the
Manhattan
Comr
and Thomas P. Lynch, Presi-
pany
Bronx County Trust Com-
dent
Under
pany.
agreement,
cial
the
terms
which
of
the
received
approvals during
offi-
the current
month,
Bank of the Manhattan
256,046, or 85.c>%
300,000
Company paid $7,426,466 plus net
shares, to 4,749
Ratification by
.operating earnings from the first
k
S
?? stock 0£ £be year until the date of sale.
banlc" was necessary to
Acquisition of the $80,000,000 ineffect the
5? ltrSR
merger.
stitution
iiead^artT °J the„FilLst
located
tional
at
CRy
^5 Wall Street NaHe^ Offfce- nl to
staff
of
First
National will
be
located at this address, beginning
Marcn 31. Former
headquarters of
First
National at 2 Wall Street
will' become
a
branch
of
First
National City, the 72nd in Greater
New
York.
All
National
City
branches will continue at their
locations
present
The
name.
under
Corporate
partment maintained
City and
Bank
its
trust
Farmers
will
to
move
new
De-
by National
affiliate, City
Company,
Trust
the
First
building,
where
the
Department of
Trust
the
Trust
National Bank will
National
Corporate
the
First
remain.
of
the
institution,
new
of March
as
on
31, will be published
Tuesday, April 5. As of Dec. 31,
1954
combined
the
brinSing its total in the Borough
the
Officials of the bank empha-
.
sized that the merger would not
affect the ooeratlons of the former
Bronx County Trust Company of-
fices
of
resources
institutions,
including
those of City Bank Farmers Trust
Company
of
$143,000,000,
were
$7,180,000,000. Combined deposits
of
National
Bank
Farmers
amounted
the
City
to
including
and
First
City
National
$6,301,000,000.
Since
of
assets
and
the
that
win continue to
staff
present
serve the bank's
customers as in the past. All officers of the Bronx County Trust
become officers of Bank of Man-
hattan. Thomas P. Lynch, the
Bronx County Trust President,
has been elected a Vice-President
of
Bank
Manhattan
of
will
and
be in charge of the bank's 16 ofin the Bronx and WashingHeights., Pending his assignment
to
new
responsibilities,
Frederick J. Freese, Vice-Presi-
fices
dent
of
Bank of
Manhattan, will
be associated with Mr. Lynch in
the administration of these offices,
The
Bronx
County
' originaiiy
pany
Twenty-Third
Ward
city of New York,
the
old
Ward
title
its
It
Trust Comas
the
known
Banks
the
the last of
to
surrender
chartered
was
of
Bank
was
in
|First National were jng served the people of the Bronx
mv?nnrw * fiflonger than any other banking in$165,000,000 for the 300,000 shares
stitution.
outstanding
an
rather
remains
than
through
the capital
of stock,
excnange
the
same
National
as
At
the
funds
year
were
S32 000 000
Bank
farmers
Farmers
capital
funds
of
Citv
ComSanv
Trust
iiust
company.
Chairman
and
officer
be
eeutive
First
of
chief
ex-
City. Alexander C Nagle, formerly
President of First National, will
become
of
Posits
have
1890
Director
a
the.
of
and
Executive
Chairman
.Committee.
Rockefeller, President
James .S.
and.. Richard
S
to
the
County
Bronx
in
Its
1925.
Bank
.
,
Manhattan's
of
jt
XSnrSi^Thl
472
senior
-n
the
Bronx
for
banking
offices
three
the
of
National, will become
Vice-President
of
Na-
of
Execu-
an
First
(.
...
.
r
|
Five Directors of First National
have
become
members
of
t
City. They
are
Mr. Nag e, George F. Baker,
Jr., Percy Chubb II, Edward S.
•
T
wto tove
^
2™Dfr«tors
Calder,
of the Executive
Com-
mittee of Electric Bond and
Share
the
that
from that Board for reasons of ill
health.
deep
Mr.
Sheperd
gratitude
for
Mr.
expressed
Calder's
service to the bank, declaring that
his resignation was
*
a
in
favor
March
on
issue
new
25
of
$5,000,000.
bank,
•
its
S._Klee-
of
-
stock
to
share
the
on
for
basis of
each
two
one
shares
previously held.
M.
former
been
*
Romanenko,
Manager, have
Assistant
appointed
Assistant
the
Exchange Bank
N.
Baxter
Mr.
Jackson
New
der,
Assistant
former
Robert
Wilson
and
Waldorf
Mr.
to
be
is
in
feller
charge.
Center
*
Rocke¬
close
for
Sav¬
that
announces
of
business
on
April 1, all services and
departments of the bank will be
new
from
Wall
74
Street
to
quarters of the bank's main
office
at
York.
The
30
place
Wall
Street,
opening
of
New
the
from
8:30
Monday,
on
a.m.
*
National
has
stock
in
vote
at
merger.
the
favor
of
the
Bankers
merger.
merger
of
agreement,
The
ceive
of
Public
stockholders
National
will
one-and-one-eighth
Bankers
Trust
until
*
both
re¬
shares
Company stock
dents
Colt
meetings,
the
of
at
two
Chester
the
Presi¬
banks, S. Sloan
Bankers
Trust, -and
Gersten
at
6:00
4,
p.m.
*
the
Public
E.
Na¬
appointment of Dwight G.
Allen
as
Assistant
an
of Manufacturers Trust
New
York
was
Treasurer
Company,
announced
today
by Horace C. Flanigan, President.
Allen
Mr.
bank's
tive
came
Mr.
Far
Office
is
assigned
Eastern
in
was
the
Representa¬
Tokyo, Japan.
to the bank in
Allen
to
1946.
appointed
He
In
1953
an
As¬
sistant Secretary.
re¬
of
of Executive
post
and
of!
member
Directors
of
Bank¬
ers
Trust, and Henry L. Mosesv
presently a Director of Public Na¬
tional,
the
also
is
Bankers
rectors.
Bank
expected
Trust
Items
of
merger
bearing
the
of
Di¬
the
on
Public
the
with
join
to
Board
National
Bankers
Trust
Company appeared in our issues
of Feb. 24, page 936 and March
3,
page 1034.
?
*
The
*
Baldwin
Trust
Co.
land,
New
stock
of
stock
of
Bank
>
*
National
Bank
&
of
Baldwin, Long Is¬
York, with common
$260,000, and preferred!
$7,500 (retirable value
$30,000)
the
and
Peoples
State
of
Baldwin, with comqion
stock
of
$262,500 were consoli¬
dated, effective March 4 with the
Meadow Brook
National Bank
of
Freeport, Long Island, New York,,
under the charter and title of the
last named
date
bank. At the
effective
of the consolidation the
solidated
stock
-bank
had
con¬
capital
a
of
$4,746,750
in
474,675
(par $10 each); surplus of
and undivided profits
shares
ment:
and
well
the
as
Board.
We
Federal
does
Federal
Reserve
not
Reserve
understand
in
act
that
Board
usually
where
cases
merged institution will be
bank
until
Banks
has
prepared
New
that
on
our
have
F. Stanley Schaefer, Vice-Presi¬
in
charge of The County
dent
Trust
N.
Heights
with
the
as
He
has
advised
his office has
was
will
If
receive
all
us
prompt
goes
as
look forward to
combined
the
merger
Bankers
additional
ex¬
open¬
institution
on
is finally
Trust
a
Mr.
Clerk
offices
in
ap¬
Company.
Vice-President
a
*
The
>
New
that
16
the
1941.
State
approval
•
Banking
on
March
given
was
Bank
York, to
He
1927,
*
reported
Peoples
New
since
since
$
York
Department
to
of
Hamburg,
certificate of in¬
a
of capital stock from
crease
$250,000, of 50,000 shares (par $5 per
share) to $330,000, consisting of
gain
66.000
Greater
value.
will
shares
the
of
same
par
bringing to 42 the to¬
banking offices lo¬
Manhattan,
Bronx,
in
The
As of Dec.
capital
31, 1954, Bankers Trust Company
000
stock
resources
of
$2,279,456,deposits of $2,028,542,721.
date, Public National
resources
of $564,-
344,125 and deposits of $507,490,-
Following the merger, Bank¬
Trust will have outstanding a
as
to
N.
of
State
Bank
increased
J.,
Jan. 24 from
$1,000,000
by.
a
of
its
$800,-
$200,000
dividend.
*
*
Announcement
same
reported total
National
Elizabeth,
had total
total of
as
Westchester
officer
an
con¬
merger, the data
filed prior to ours,
Brooklyn and Queens.
150.
week.
Northern
Trust
New York,
ers
completed * 35
last
work
been
morning of-April 11."
On the
started
has
we
084 and
service
Schaefer
Plains,
Yorktown
and
offices,
of
years
White
Katonah
Superintendent of Banks
a
cated
Company's
Y.,
recently merged with
merger
When
than
County
another
proved,
less
*
the
which
pected,
ing as
25
We
is
*
Bank which
consideration.
the
he
*
communication
soon
sidered
State
a
that
approve.
constant
York.
as
the
Superintendent of
indicated
to
in
been
the
the
of 'not
reserves
$646,640.
tal number of
The
Board
be
tional, made the following state¬ .$4,146,610
new
April
the
to
will
merged institution.
is expected
to be
Vice-President
870,000
Backers Trust Com¬
to
the
Gersten
elected
outstand¬
has
3,051,200 shares out¬
standing. Under the terms of the
main office at 30 Wall Street will
take
the
Trust
of
Bank
Friday,
removed
against
capital
The
with the
*
Seaman's
the
office
continue
bank's
ings of New York,
after
will
the
at
office.
*
The
Messrs.
Mr. Romanenko
the
at
the
Sny¬
Manager,
Astoria
-
Wilson
located
meeting
552 shares
it
T.
Secretary.
Snyder are
bank's
where
Bank
25
announced
of
Assistant
The
"This merger is subject to the
by approval of the State
Superin¬
Chairman., tendent of Banks of New York as
Jackson,
also
Corn
York,
March
on
appointment
as
Vice-
Chemical
of
announced
was
of
At
Michael
of
at
merger
was
2,541,880,
or
83.3%;
10,333 shares were cast in oppo¬
*
Wilson, former Man¬
and
ager,
vote
for each share of Puoiic National.
*
Cyril
The
86.7%.
or
Public
sition
holders oL
previously outstanding
40,000 shares
new
sold
was
name
pany
com¬
addi¬
an
The
merger
at
bank's
the
voted
ing.
20,000 shares, of its capital
a price
of $50 per share.
stock
the
Arthur
distribution
tional
of
National
shares
The
President, has just
pleted
The
which
of
is
begin
the
authorities.
754,519,
were
stock has brought its capital funds
to
more
than
man
will
under
*
announced
of
banks
of
Trust Company, fol¬
approval- of the various
regulatory
was
sale
two
Agree¬
terms
Bankers
Public
S'fi
that
the
under
operations
lowing
Colonial Trust Company of New
York,
Merger,
approval
and
Mr.
National
in
Webber
has
*
that
been
Henry
W.
appointed
an
Assistant Secretary of the Howard
Savings
N.
J.,
Institution
was
made
on
Continued
4,029,950 shares of capital
of
Newark,
March 22 by
on
page
45
1893,
Xhis-annauncement
merger
been
appears as a
matter of record only, the, financing having
arranged-privately through the undersigned.
woujd not affect the long-standing
-
„
the
hetvueen
accepted with
the utmost regret.
1
Bronx
New Issue
Us
and
.
customers.
^
^
$25,000,000
^
c,
..
\r-»
Shareholders of theChaseNa-
''onal
(Canadian)
„BanJ<, ant' th,® ,®a"kM
Manhattan Company, boto of New
rk
' y' ln special meet
g
March 28, approved by record
twQ
bgnks
by
£be
£base
uJed
Household Finance Corporation
the proposal
votes
reguiatory
and
^
to merge the
Subject to appr0val
be
formady
4V4% Sinking Fund Debentures due 1975
authorities,
Manhattan
are
joined
schedas
of
the close of business today, March
31. and will begin operations in
following
day
as
The
Chase
Manhattan Bank
The proposal
£
tbe banks- wh°sc c0™"
cnn^no rvfrf *n m<+
3v
500,000,000 will create.New York s
xi
and a Director of NaCity since 1931, has resigned
Company
tional
of
Plan
a
tained
27
personaj relationships which have
the
former Directors. Curtis E.
Chairman
which
936.
page
of
joint
plans
■
said
e
Board of First National
Th0e0Biard
the
20, page 273,
and Feb. 24,
810,
page
founded in 1907. Mr.
, Bank
Marshal,
on
.
ment
of
All of the officers and staff
Public
d three o(fices of the Br0nx Na.
Na-
ritv
y*
17,
voted
was
14,419
The
and
of
Bronx
in
Bank,, founded
Borough
Perkins^ Vice ~
management
Executive Vice-President of First
_.
against.
Company
Trust
stock.
.
City will continue in their
present positions. Grant Keehn,
tive
for
Trust
stock¬
National
banks,
or
shares
with
of
Public
jn 1928 Manhattan acquired
years
tional
tinnal
-
«fZ
0()0'000- The Bank of the Manhat
tan ComPany has Played an active
Chairman, and other members of
the
de-
$252,260
from
grown
bank
$70,966,000 at the end
1954.
rQle
National
to
Company
C.
Sheperd, Chairman
Board
of
National
City,
the
will
total
$585,000,000,_ including
caoital
Howard
of
end,
changed
was
of
name
Trust
in
City's.
The
voted
meetings
The
Company, both of
New York City, held March 24 at
the
respective
40
shares'
of
and
Bankers
of
at
2,750,000
were
voted
1888
and ciaims the distinction of hav-
against.
meeting
compared
Presidents
grand total to 67
two
total
offices,
new
ton
The first combined statement of
condition
Feb.
gives Bank of the Man-
hattan Company nine
voted
incident to the merger were noted
in our issues of Jan.
York
21
wide
^Comptroller of the Currency, the
merger became effective March 30.
;
of
Bank
2,301,034
outstanding,
Bank
while
shareholders
of
merger,At special meetings held March
30, shareholders of The National
holders
were
Street,
special
voted
afternoon
Manhattan
NEW
At
7,400,000
were
merger,
the
of
20,990 shares
CONSOLIDATIONS
bank's
outstanding,
.
15
l-'c
!a?gfst bank, wa$ announced
Jointly by the managements of
the two institutions
on
Lee
Higginson Corporation
A. E. Ames & Co.
Limited
Jan. 14.
At the Chase meeting, held
Monday forenoon this week at
the bank's head office, a total of
6,405,062 shares,
representing
March
28,1955.
I
The Commercial and Financial Chronicle
(1503)
16
ash
the best
was
chemical
THE MARKET... AND YOU
convincing
some
bulk
of
the
stock
list
Iron, but it
into
ran
offi¬ lately
an
cial denial.
through what was most¬
ly a backing and filling expe¬
rience this week while special
issues, including somewhat
prominently some of the
atomic energy items, put on
somewhat
section not given
toying with peak
unique in
The
Vir¬
runups.
it
makes
which
went
At Central States IBA Conference
ginia Carolina Chemical was
able to push to new highs
STREETE
By WALLACE
acting of the
arid posted
issues
a
to
levels.
*
❖
*
❖
❖
*
aircraft
The
pattern
was
Among the defense issues
shared in the limelight ragged, the group contribut¬
was
Newport News Shipbuild¬ ing an outstanding laggard to
almost
every
session, with
ing which rushed to an his¬
their own spectacular shows.
toric high on some of the Douglas often turning up in
that role.
The issue put a
Coppers stood out on good
larger day - to - day gains
group action when the price
couple of losing sessions to¬
around, running as much as
of the metal was lifted
by half a dozen points at a clip. gether with an apparent air
3 cents a pound. The
strength This issue's best in the 1946 of aiming for a test of the low
was a bit
surprising since the bull swing was less than $35. before bothering about the re¬
move
had been
widely pre¬ It more than doubled that cent high. At one stage only
dicted due to the
disparity be¬ level in its recent popularity, a couple of points remained
tween
the
local
level
that
and
which is
world markets, and recent
strength in the issues
been
thought to have
had
if
to
tion
with
atomic
the
gains
tained and
*
clipped
profit-
develop¬ taking.
were
Some
able
pinpoint attention in
issues
was
enough
operating in a study on the strength for some sharp rises
feasibility of an atomic-pow¬ in a couple of the stocks, nota¬
ered rail locomotive, was able bly Stromberg Carlson which
add
more
appreciation of
20% in the stock's
an
than
yalue in
co¬
single session. Bath
Works, selling some
Iron
a
three times
to
S.
U.
if
continues
to
Machinery
with
enthusiasm
'
circumstances to be construed
no
or
a
solicitation of
far
more
the
as
of
Kin-Ark Oil
Company
Common Stock
-
all a new high.
(special to the financial chronicle)
*
*
joined' theTta^o?
*
Automotive issues did little,
Chrysler
the result of
as
a
With Mutual Fund Assoc.
The stock
past.
j!
Logan & Co., 210 West Seventh
except for an early flurry in Street,
on
achieve-
sumed dividend
payments for niore
(Special to The Financial Chronicle)
SAN
FRANCISCO, Calif.—Ken-
tu^AsSdatT^MtoY:
gomery Street,
*
*
*
Some Oil
Oils,
offer
general
without
may
being
union
with Walston &
(Special to The Financial Chronicle)
generally.
Oil
week
1 m dBarbour"& Co.!
are
*
the
over
much
in
were
trough
baton from last week's favor-
(Special to The Financial Chronicle)
the
as
the
REDWOOD
CITY, Calif.—Chrrs
A. Mitchell has been added to -the
same
responded
1839 Broadway.
most
to
di-
came
showed
little
CHICAGO,
is
Jriow
with
Thome
William
idwStTtock'exS
Salomon Bros.
Master Electric and McGraw
determination
California,
;
companies classic show of indifference.
either direction.
in
i
111.—Bruce
connected
acting, what came close to being a.york
better
Com¬
ignored market trends^with Blair & Company, 135 South- La
gest its gains. Texas Co. was
the
Eppler
(Special to The Financial Chronicle) *
General Electric
of it.
L.
William Blair Adds
at
earnings with good strength, getting going, but not much
the
Avery
occasionally
good put on a tentative show
to
of
pany,
makers,
auto
Gulf Oil, Westinghouse
ite, Deep Rock Oil.
for
Cozens
Avery Eppler Adds
*
Electrical equipment shares
Houston
took
*
staff
subsided
,
PASADENA, Calif.—Marguerite
but lolling far closer to their lows Bank Building,
picture
division
which
>
With J. M. Barbour Co.
targets,
showed little demand and
now
C ' 550 South sPrmS Street.
The independents, even with-
or two
ANGELES> Cal.—George E.
buoyant than the rest, Fowles is
being made by the
this
(Special to The Financial Chronicle)
LQS
great overall than to their peaks,
any
progress
Walston Adds to btati
"•
■».
,
.
cautious attitude by traders.
able to out
were
sprinting issue
a
the
to
Sprinters
usual,
as
a
■
,.
,,
.
hut all of the auto issues show -
the first time since 1947.
to
Superior Electric both idled around in
an
inactive
narrow
Adds;
(special to the financial chronicle)
„
neither
ranges,
^h^tltle of the highest.priced
issue
currently
•
The
■"
-*
*
*
in
-
*
V
S
,
,,
•
!.
-
averages
With Shearson, Hammill
"(Special toTHE Financial Chronicle)
•
/
as
far
as
-TOTCaMSt*,-lu'.Mtfarcus' E. Bqrthe inst*iri
N. Rothman arc
with Shearson,-Hammill &
Co., 206 South La Salle Street.; '
-now
*
indicated, but it
pretty spotty
a
dP®.SaBeStreet*
..
dustrials, at least
.
.
so
;
Hails-.\outperfcitmed.
•
.
,
Mining Issues
few points
was
performance.
;<
^
of
the
Alstyne, Noel & Co.
'
.
more
to
signs
uranium
to
any
erencef
were
great change in of
Mining, with
an ex-
-
What gyrations -there-
were
largely
hopes trader anticipation
dividend
precious metal situation, little
Newmont
.
some
stirring, undoubtedly due
far
-Renyx, Field
long-neglected mining indicating little investor pref-x
companies showed
than
'
a
~
legally offer these securi¬
-
.
*
■V*
:*%
*t ."v
c
,
the Stock
on
.
.
couple of of-more than
a
keep possession .of far this year../;
»
.
be obtained Jfdm tke undersigned only
undersigned
,
,
Exchange.
5
V.v
-
compliance with the securities laws of the respective States.
With J. Logan Co.
new
Stir
March 31, 1955
than
solid
sand dollar mark
Price $2.75 per share
Van
'
^
being based
rather
the
ments of the
times
ties in
~~
issue, traded above the thou- ing built up a trading range Salomon Bros. & Hutzler, 231 So.
500,000 Shares
in those States in which the
Company, Chicago, in charge of the
of star of the section in posting
high hopes for
on
future
some
Oil of
may
Mr. Evans is Vice-President of the Continental Illi¬
offer to
an
of such securities. The offering is made only by the Prospectus.
Copies of the Prospectus
More than 400 investment bankers
partner in Schmidt, Poole, Roberts & Parke,
an
offering of these securities for sale
-
States
country attended the Conference.
a
weekend plug over the airsold under $15 last year be- waves. That Chrysler's hour
showed
it could muster as fore
starting its spirited re- of decision with the unions
much vigor as the best of
covery.
It sold around $60 over the guaranteed annual
them. But Zenith, which has
this week in posting another wage will come a bit later
occasional
fling in the
high in the string which than in the other companies
spotlight, was resting for the
most this week from just such started when the company re- has kept the issue a shade
This advertisement is not, and is under
any
of the
Nineteenth
Group, held March 16
at the
shown
are
Central
the
municipal bond department.
won-
some
showing
while the Standard
buy
Mr. Schmidt is
the
the IBA,
of
of
in The Drake, Chicago.
Philadelphia.
perform
ders in its way
among
an
17
Group
from all parts of the
if
Hoffman
<
.
States
Conference
nois National Bank and Trust
impart
higher than BaldWin, simultaneously was able
to post an 18% price improve¬ an outburst, and it was occa¬
ment. General Dynamics, sionally
'prominent in
the
which already has one atomic- casualty column.
:Je
:jc
if
propelled submarine to its
credit, posted some abnor¬
I
Chemicals Mixed
mally large gains to keep in¬
Drug issues, and Parke Da¬
terest in the group diversi¬
vis in particular, fared a little
fied.
\
better than the general run of
*
*
*
issues behind the glamor of
A Split Favorite
the
Salk vaccine for polio.
In the case of General
Dy¬ The standard chemical com¬
namics, the stock was split panies, however, were largely
two-for-one via a 100% stock neglected with duPont taken
dividend only a few weeks to sagging more times than
Allied Chemical, which
ago. - The new issue posted a not.
high this week that about was bypassed in several re¬
equaled the best price reached cent market runups, showed
by the old stock last year. little inclination to do more
There was much merger talk than back and fill just under
linking Dynamics and Bath the $100 line. American Pot•
Central
Annual
points
to
return
to
sjc
America, and Thomas W. Evans, Chairman
of
*
electronics
the
to
required
Schmidt, left, President of the Investment Bankers
Walter A.
Association
low, against
dozen
a
the earmarks of
*
Baldwin-Lima, which is
than
more
the
*
*
sus¬
HiCAGft
and
the
have shared
of the defense popular¬
were occasionally
back a bit hard on
spectacular.
#
Engi¬
for it to reach the
which
companies ity,
that have any remote connec¬
ments,
Babcock &
neering,
if
came
only some
have been
Wilcox and Combustion
some
When it
feat that
duplicate.
able to
dis¬
a
blue chips
the
of
counted the boost in advance.
if
Thursday, March 31, 1955
...
came
a
on
case
the
meetings
of
eve
and
of them.
[The views expressed in this article
a.
Brand
has
become
associated
Renyx, Field & Co., Inc. >
Two With Ashton Co.
(Special to The Financial Chronicle)
DETROIT,
Mich.
—
Alfred
P.
mining1donett necessarily ctt anytime coincide Lawitzke and Wirt Lee are now
.
r
•
S with those of the Chronicle. They are. with Ash ton & Co, 15315 West
Companies generally, was the.' presented as those »/ ike author only„} McNichols Road. -'
tensive
_
nortfolio
•
in
„
,
Number 541Q
181
Volume
,
17
(1509)
The Commercial and Financial Chronicle
.
.
\
Government Influence
Securify
on
Markets and Business Trends
more
will
remove
and
that
this
ply
very
the
rate
has
Nesbitt, Thomson & Co., Ltd.
loan
control of interest rates furnishes
Concludes, if
$101%.
Because
security
would do
during
so
When
be
an
At
look back
we
bond
this
agreeable
juncture
a
the stock
on
it
1955 will
of
markets
truth in such
direct
the
bearing
rate
If
be
That
the
rates
Ross
H.
Oborne
an
To
would like to have that answer.
us
An
1954 has left
security markets in
classes
all
investors
of
both
in
rise
unprecedented
with
the
feelings of well being. Even those
consolidated profits by sell¬
who
ing stocks and buying bonds have
had the satisfaction at least of see¬
ing their bonds rise in price. This
general
feeling of
well being,
however, is disturbed here and
there by doubts about the future.
Never
fully
Never
and
calculations
wonderful
are
the
found
most
a
effective
controlling
the flow of
If it is true
that such a
slowed down at will. In turn
it would logically transpire that
the security markets could be like¬
up or
affected.
find
in
truth
some
statement let
such
a
look at the basic
us
concept. Again a simple principle
is
evident, that it would be better
the
for
economy
as
a
whole
business did not expand too
ly
contract
or
if
rapid¬
violently. In
hol¬
too
brief if the large bumps and
out it would be
lows were ironed
The
problem
from
business
then is to keep
expanding too
certain periods
and
contracting too severely at
rapidly
from
at
others. As business cannot expand
the
without
form
use
of
another
or
money
and
of
because
contracts
a
in one
normally
lack of it,
then the control of business would
to
appear
with
be
directly
this medium.
concern
is' what
concerned
Of most direct
business
has to
borrow money. Obviously
to pay too
pay
to
if
business is forced
a
a rate of interest in relation
anticipated profit margins, ex¬
high
to
pansion
is
the
People
money
its
use
continual controversy
existed on the question of whether
should
rates
interest
low
be
quite
1954,
market.
took
over,
may
whole
carrying the
of
cost
dous
took
time Eisenhower
then
From
over.
tremen¬
debt. Interest rates were
war
at the
low
on
policy
the
changed. Efforts to curb inilation
and make a dollar worth a dollar
resorted
were
rates
Interest
to.
and they went up quickly.
It took business a little longer to
went up
gradual
It is true that we saw a
market
the
increase
in
between
1946 and
averages
1953, but these
sold
Averages
they sold
From
years.
at
Indus¬
eight
to
From 1950 to
nine times earnings.
1953
10 times earn¬
at
In 1955 these same Indus¬
approach a 15 times earn¬
ings.
trials
sectors
investment flourished
inflationary era such as
enjoyed during 1946-1951, they
equity
during
we
have
an
languished
in
months. The return
recent
more
on
such funds
on
by
be
Ranald
Dominick
of
The
will
Friday, June 3,
announced
was
Macdonald
&
H.
Dom-
inick, President of the Club. This
year's outing will be the 31st for
the Bond Club and will take place
at
The
Sleepy Hollow Country
Club, Scarborough, N. Y.
W.
Scott
Ripley
been
this
Cluett
Co.,
&
named
year.
Harriman
of
Incorporated,
has
Field
Day Chairman
He will be assisted by
four general Chairmen—Robert A.
Powers
of
Smith,
Barney
Co.;
&
Charles S. Werner of Wertheim &
Co.; Blancke Noyes of Hemphill,
Noyes & Co. and A. Halsey Cook
of
The
National
City Bank of
New York.
and
the
will
Committees
Thirteen
handle
entertainment
sports,
other activities
at the
outing.
Mr. Macdonald announced the ap¬
attractiveness
Committee,
of
common
sioci
pointment of the following
mittee
Com¬
Entertainment
Chairmen:
Rockefeller,
Avery
investment to
this kind of money
Dominick & Dominick; Golf
has
the inflation-bene¬
mittee,
inflationary pressures would again
Com¬
Wood
Struthers & Co.; Attendance Com¬
mittee, Robert H.
B.
Baldwin,
Morgan
Stanley
&
Co.;
Bawl
Street Journal Committee, Wick-
beckon forth such money
liffe Shreve, Hayden Stone &
grown
as
rewards
to
"Other"
such
equity money has shrunk. It if
suggested that the resumption of
green
lation.
into the
pastures of inflation-specu¬
The marginal supply
of
stocks
might then gain ascendancy
at
the very time
when other factors such as harder
over
demand
higher
and
money
weaken
taxes
could
demand.
the
Should
in its
that business be
discouraged
temporarily
from
further expansion, it would prob¬
wisdom
government
require
Philip
K.
Bartow,
Co.,
Chairman; Robert J. Lewis, Estabrook
&
Dealers
Street
A.
Chairman;
Investment
Editor;
Bawl
Acting
Co.,
John
and
Straley,
Digest,
Circulation
Journal
Com¬
mittee, Robert L. Hatcher, Chase
National
Bank,
Chairman,
and
William
S.
Renchard, Chemical
Corn
man;
Orin
Food
Exchange Bank, Vice Chair¬
Special Features Committee,
Leach,
Estabrook
&
Co.;
and
Beverage
Committee,
be during a period of dan¬ Walter H. Weed,
Jr., Union Se¬
gerous inflation. In the meantime, curities
Corp.; Tennis Committee,
the government has the effective
Braman B. Adams, Adams & Peck;
means through the management of
Arrangements
Committee,
Ray¬
interest, rates, to make any neces¬
mond Stitzer, Equitable Securities
sary influence felt. For the time
Corp.; Trophy Committee, Arthur
being, and under peaceful condi¬ F. Searing, C. V. Starr & Co.;
tions,
the
government
has
an Stock Exchange Committee, Gil¬
acknowledged policy of levelling bert H. WShmann, White Wrfd &
out the bumps and hollows in the
Co.: Horseshoe Committee, Glenn
ably
this policy
of money,
a
condition which perfectly com¬
pliments the other attributes of a
prosperous
environment for the
As of today
economy.
requires
a
benign
conditions
Clark, Dodge & Co.;
Committee, William H.
Long, Jr., Deremus & Co.
Kartranft,
Publicity
With King
Until fundamental
market.
stock
ease
change
so
as
multiple is reminiscent of
the later 30's and the several years
inence,
we
can
look
the
upon
Merritt
(Special to The Financial
to bring
NEWBERG.
inflationary pressures into prom¬
preceding the 1929 crash. This of
but, when it did, it showed "itself does not constitute a threat.
signs of a healthy reces¬ The relationship
is of interest,
sion in the offing.
however, because it points up the
By June of 1953 rates were the environment in which the market
this year
of
Day
York
New
probably followed fairly
closely the average profit margin
in industry at large. The relative
ings multiple.
This
of
Rister
is
Oreg.
with
Chronicle)
—
King
Floyd A.
Merritt
Company, Inc.
future with confidence.
not take place. Here
crux
the
all
years.
By then
worried.
England
was
positive that the U. S. was
going to put the whole Western
World into
a
major depression.
Business outlook was poor, busi¬
highest
of the matter.
normally borrow
when the rate charged for
is low and that they will
will
was
expansion had slowed down
inventories were high and
ness
and
not
15
in
everyone
Unemployment
moving.
fig¬
rising rapidly. The U. S.
Government even started to panic.
ures were
They need not have been too con¬
cerned because the method used
rates to slow
the bloom could be just as effec¬
in
interest
raising
used
tively
for everyone.
better
the
Before
Administration
"Other"
these
it
Field
annual
Club
react
exists, then it follows that
the whole economy can be stepped
To
years.
a few good years.
however, these good
tidings failed to reach the stock
Until
trial
means
wise
few
last
Eisenhower
have had
the
ideas.
business.
the
In the post war period we
prosperous
and
of
'managed
of
policy
a
higher stock market? It may, in
the absence of inflationary pres¬
sures.
money' is clearly shown by the ac¬
tions of the U. S. Government in
promise
1947 to 1950 the Dow-Jones
abstruse
has
"This
Does this of necessity
seven
One of them is that the govern¬
means
in
York
New
right
predictionists are
our
that business will be good in 1955.
other low interest rates because of
weighed and balanced. Many and
varied
are
the conclusions and
ment
of
assume
us
corded
analyzed. Never were
accurately
plotted,
more
weird
Chronicle"
October, 1954—
Let
high. One faction favored high in¬
terest rates to curb inflation; the
so
more
emergent
Financial
and
strong, giving full support
so
also to the future.
care¬
pencils
advances, rolling infla¬
and
long-term
growth
so
carefully
"Commercial
the
in
mine
a man,
are
doing now.
such factors as tech¬
their
were
charts
of
article
an
Almost to
matched the progress re¬
in
earnings during the
nological
tion
from
quote
I
picture for
gloomy
a
port to a high level of business ac¬
tivity.
Perhaps that is why the
bond markets and stock markets
are
of
fited
predictionists
few
are
paint
that
further
this
little in
security
hardly
they
as
accepted fact.
carry
a
and
or
analysts
market
the
have
sharpened
"managing" interest
business is al¬
in
influence
to
most
C. Andreae
slowed down.
government has made
use
idea in the
and then try
business
to
Whereas
has
economists, business leaders, poli¬
ticians and analysts give full sup¬
or
up
minds
our
business in 1955.
discourage borrow¬
business expansion can
stepped
full
J.
that
or
then
ing
this
keep
There
of money.
encourage
influ¬
by
markets.
charged for money can either
est
government
The
business
into the future
relation
change in the rate of inter¬
a
of
look
to
a
this one factor,
charged for
on
a
Look Into the Future
us
back
point
have
interest
of
the hire
focal
would
idea
whole
our
the
then
statement
If
as
nor¬
equity
type
investments
such
as
real
estate, commodities and business.
encing interest rates.
Let
or
emerges
funds
idle
to
well
mally engaged in "Other"
Point
Rate of Interest—The Focal
a
truth.
influence
A
If there is certain
idea
main
possible
generally tend to cease to borrow
it when the rate is high.
contemplation?
good many of
from.
started
attributed
be
agreement has been reached
one
can
and
are
where
the
pension-type
of the financial field. Some
corner
some
period of dangerous inflation, and, there¬
a
fore, until fundamental conditions change so as to bring about
inflationary pressures, we can look into the future with confidence.
has
into the market. It is less
at
back
we
stocks
of
generally recognized that some of
the marginal demand for stocks
may
come
from
the
opposite
with changes
in interest rates, it is not surpris¬
ing that there have been wide
price
fluctuations. We are now
gov¬
held
that
of the demand for stocks may
markets
The
Bond
cause.
recognized
conservative
concerned
directly
"single"
a
generally
money
Loan
selling
now
are
pre¬
however, seldom
can,
attributed to
is
stocks
of
drawn
about
required that business be discouraged temporarily, it
ernment
they
$92%;
demand-sup¬
balance
"attractiveness"
they had reached a low of about
controlling the flow of business and the securities
inflation and the threat of war-time taxes.
Victory
a
marginal
It
selling at $98.00; by June of 1953
markets.
Say investors have raised the banner of confidence, and the
market may continue upward, if not subject to the violence of
of
9th
Canada
of
as
equation for common
be
3% Bonds due June 1, 1966, were
most effective means
a
been
Bond Club Field Day
Set For June 3
of
"attracted" into
result of growing
been
ponderance
example, in June of 1951, Domin¬
Canadian investment bankers, in commenting
in the securities market, point out that govern¬
the situation
ment
sometimes
doubts
amount
"confidence." In the
change, the bond market
reacted
more
quickly.
For
has
Ltd.
ion
on
the market
to
HERBERT C. ANDREAE
Two prominent
now
changed
not
have
rates
slow
and
Even
debilitating
certain
a
has
money
While mortgages and bank
much.
Director, Dominion and Anglo Investment Corp.,
much
up
about 5%.
was
picture
By J. ROSS OBORNE
Asst. Manager,
going!
than they come down.
Similarly a loan from a bank in
1952 might have been obtained at
about
3V2%.
By
mid-1953 this
of
habit
quickly
to
start
the
boom
again.
the
Before
end
and
the
of June,
1953,
of high rates had
low
changed
rates
again.
way
continued
up
were
on
This policy has
to the present time
small interrup¬
only recent
idea of
interest
you and me, let's
look at a few examples here in
Canada. Canada, incidentally, has
followed the same general pattern
To
tions.
what
rates
as
give
these
mean
you
changes
an
in
to
some
certainty as to
taxes, and most importantly some
certainty as to the overall level
of prices.
certainty,
This announcement is neither
some
price-earnings
1938-1939,
1954-1955 with those prevailing in
1947-1950.
The
hypnotic
chant
"that inflation will benefit com¬
mon
stocks" Imard so often and
Contrast
4
buy
any
an
offer to sell
nor a
solicitation of
an
offer to
of these Bonds. The offer is made only by the Prospectus."*
*
$2,500,000
the
1926-1928,
of
ratios
insistently in the post war years
has
died
away
in the past 20
months.
Well
it
might.
Events
Republic of Cuba
Veterans, Courts and Public
Works Bonds, 4%, due 1983
(Dollar Series)
have
proved it a false axiom once
In periods of inflation the
market has lagged behind other
indices. On the other hand
the
1952,
a
prime first mortgage
could be obtained for about 4%%,
1953, the same type of
mortgage would have carried a
6% rate. Perhaps today the rate
should be about 5%, but oddly
by June,
enough
mortgage
market
rates
have
a
this
on
Price
have flourished
months of quiescence
averages
in the recent
has
Experience
front.
98% plus accrued interest
that common stocks do
best in a peaceful non-inflationary
environment. Hence our qualifica¬
tion that the market may continue
proven
Copies of the Prospectus may he
obtained from the undersigned.
upward if it is not subject to the
of
inflation
and
the
violence
qAllen & Company
In brief
peaceful, con¬
threat of war-time taxes.
it
the U. S. A.
In
It is
political
sell at its best multiples.
environment of
an
more.
the whole policy
with
can
must be
given
a
servative environment in order
to
flourish.
In
have
raised
fidence."
that
March 29,,
1954 the
"investor" is said to
banner
the
There
can
be
of "con¬
no
doubt
the
of the economy
willingness to believe in
continued growth
1955
.
&
The Commercial and Financial Chronicle
(1510)
18
that
Business oi Refining Uranium Ores
the
future
By EUGENE B. IIOTCHKISS*
any
We
know
the
of
too,
unique
nuclear
of
power
plants which require the replace¬
(
Hoichkiss characterizes the
of uranium discoveries
ions
rapid rate at which
fantastic.
as
Says
of nuclear
use
Reveals task of milling
quirements.
is
ores
is dependent
energy
after
future
on
power
mills, but v/ants
no
fastest
North
our
growing operation in
American
uranium
dustry— the
is
In¬
Mineral
business
—
the greatest force ever
of
The
rate
scientific
which
new
ing at
an
prospects have
tation
to
one.
at
dis¬
been
Canada
in
soothsayers
strong
as
It was only a
before the Nau¬
ever.
as
in
scant
five
years
tilus,
our
nuclear
United
Atlantic
say
sub¬
powered
out into the North
month, that cne of
marine, stood
to
the
States,
declin¬
was
alarming rate, the temp¬
prophesy was apparently
and
covered
and
destruction;
mass
last
radioactive
through
If
of
we
become
apparent
first, and
properties
and
I
—
term
Eugene B. Hotcok.ss
advised¬
ly
We have
explora¬
—
is
of
ore
us
admit that
development are daily
increasing the proven tonnage of
tion
rapidly increasing. Let
a major reason for
stimulus
economic
tion
and
by huge quantities.
obviously im¬
mensely satisfying to the prospec¬
tor, the developer and the miner,
whose prime concern is the supply
of ore in the ground. But what
sort of existing or potential de¬
These
ore
facts
mand
into
I
increasing
how well
to convert this
And
we
are
marketable concentrate
a
—and at
profit?
a
facts,
and
opinion,
some
this
because
is
of
antees.
We
a
head
U.
to
recall briefly some past events
in
the development of atomic en¬
some forecasts that were
it progressed. They may
provide an interesting point of
departure for our attempt to look
into the futikre.
mission)
perhaps
are
forget that it
too
only
was
Lord
Kelvin,
atom
to
prone
of the
time,
was
Energy Com¬
the windfall era,
military requirements.
calls
nuclear luel for each
military strong; but
long-term
must
basis
based
be
sound,
a
the
States,
Canadian
and
felt
When
ness.
as
possibility that
ultimately
as
the
tainly
busi¬
government purchase
contracts expire April 1, 1962, will
we
be prepared to carry on with
the
constructive
nuclear
without government sub¬
energy
sidy? What
are
doing to
we
ourselves
pare
of
uses
for
pre¬
it?
sup¬
reprocessing.
There is
economic connection
no
other
no
mineral
of
segment
industry producing
sumable
metal—is
faced
the
a con¬
with
the
problem of this magnitude.
scrap
Finally, in any discussion of
supply and demand of fissionable
materials
tion,
used
in
genera¬
power
should recoginze the
one
po¬
tential significance of the breeder
a
scientifically
product,
might
the
that
asserted
the
expanding
meeting of the British Association
for the Advancement of Science—
with
in the
hall where Kelvin had
same
made
his
that
nounced
in
atoms
assertion
flat
his
he
had
an¬
—
bombarded
laboratory
had
and
accomplishment
was
of im¬
significance, but as re¬
ported in the New York "Herald
mense
Tribune"
forecast
of
Sept.
and
was,
quote:
produced by the breaking
energy
down of the atom is
of
a
thing.
source
talking
a
poor
very
Anyone who ex¬
of power from the
transformation
of
these
atoms
is
moonshine."
Tremendous
followed
Hahn
1933, his
"The
13,
I
scientific
activity
discovery.
Rutherford's
and
Strassman
split
the
uranium atom; Meitner confirmed
experiments
enormous
and
next
duction
of
decades
the
reached.
measured
release of energy
ada must
look
that
thermal
to
in
quirements.
If we
major increases in
of
energy,
be
must
power
to
prepared
absorb
the
and in the
cost
sources
perfected
demand.
the
opinion of
Already
future
the
of
many
people
electric
power
industry will be based to an ever
increasing degree on the use of
fissionable fuels.
international
North Americans
on
the
ores
resource.
But if I
have
worries
the most accessible
reserves
Even those who
engineered this
demand
address by Mr. Hotchkiss before
Prospectors and Developers Associa¬
i or on to,
Canada,
1955.
marc n
some
that
be
time
Their chem¬
in the micron range.
ical
composition
frequently as
is
additional'
ability
fuel
of
the
of it.
use
overdrawn
the
about
product
our
by
being
short-term
a
gov¬
.
that
promises
to
is too pessimistic—then permit me
to recall to you how far from the
mark
were
learned
earlier
our
and
more
in
their
prognosticators
forecasts of the future.
Let
in
bear
us
present
erating
mind
installed
capacity
ceeds
that
electrical
in
the
gen¬
Canada
million KW
21
and
ex¬
the
on
basis of past experience With the
rate of expansion of the industrial
and
domestic
be
may
least
of Canada
economy
expected
20-fold
over
to increase
the
next
Coal and water
years.
obviously
power
at
50
will
a
substantial
projected expan¬
sion. But this still leaves a huge
potential demand for fissionable
fuels
supply
of this
portion
under
even
—
existing
schemes for energy generation.
Perhaps
even
is the fact that
means
important
more
we
are
not by any
limited to the present gen¬
the
believe
to
them.
recent
tion of the
aply to this the ac¬
that one pound
that
we
will
Furthermore, with
successful
use
demonstra¬
of nuclear energy
the
to
miners cannot,
come.
progress
Uranium
therefore)
assume
So
the
real
business
and
/
must
ores
supply is not assured, can
a
wider range of prob¬
present
This is what the Vitro Cor¬
lems.
nium
refining
ores
further
been
into
subdivided
27
categories for which special treat¬
ment
techniques
recom¬
are
mended.
viously,
some ores are more amen¬
able
an
to
acid
solublized in
leach, others
Since
the
is
ore
quite
lean, large quantities of the asso¬
ciated
gangue minerals must be
handled
each
to
get
the
at
and
ore,
type is apt to exert its own
peculiar malevolent influence over
the
extractive
excessive
causing
either
process,
reagent
in
con¬
sumption at the start or in gum¬
the processing circuit in
up
subsequent operations.
In
a
as
and
fine group of en¬
a
edgeable in uranium chemistry, to
design and operate our plant, they
certainly
were
gical engineer at the Grand Junc¬
tion
Operations office of the U. S.
E.
A.
C.,
the
makes
statement
"Generally
which I quote in part,
speaking,
the uranium is in
once
solution, it should
'in the can' ..."
as
tate
to
but from experience I
the
average
mill
that
add
deeply
this point is reached.
precipitation of extraction
generally
operator
The
of
uranium
producing
its
from
As
uranium
concentrates
ores.
custom
rely
on
millers, we had to
in small amounts
ores
from many
from the others.
and
each
composition
different
widely
in
varying
sources,
Some
were
clean
resembling beach
sand in color and texture; others
pulverant,
black
bituminous
could almost light
match and once kindled,,
sticky
were
types that
with
a
one
would burn for hours in the roast¬
fee
Perhaps half our normal milt
this asphaltic uranite with
was
mixture of pitchblende.
10% -20%
Another
of various nonbitu-
was
it
once
is
solution
in
several
in
However, this portion of
the process is classified for secu¬
ways.
rity
and
reasons
of
only gen¬
we can
eralize about it. One
common
way
uranium is to
precipitate it as an insoluble com¬
pound.
Recently
ion
exchange
techniques have been used — I
the
recovering
believe the
mill
new
Hirshhorn's
Mr.
Pronto
to
There
also
have
been
property
technique.
this
employ
plans
planned for
de¬
recent
extraction
to have
certain
advantages.
But
each
process
has its own family of
problems.
velopments
solvent
in
techniques which
appear
mill is set up to
ore from a particular
after
sufficient
quantities
Normally
process the
mine
a
have been blocked out to warrant
the expense of a processing
facil¬
of the expense of
handling and hauling a lean ore,
ity.
its
Because
close
to
sible.
I
fellow
Plateau
he
is
location
the
was
generally fixed
mine
miners
a
would
mouth
talking to
the
on
as
one
as
pos¬
of
our
Colorado
week ago who told
plan
to
me
erect his own
looks
eco¬
mill when he had 300,000 tons
proven
of
He
ore.
There is
no
rule of
course.
our
evaluation of
and Output
But it is
a
tle
continuity in the mill feed and
often plagued by a short¬
age of amenable ores of any kind.
For
quite a while, we had a
rough time indeed, and more
very
frequently
than we care to re¬
question of whether
member
the
we
going to lose
were
of uranium and the mill costs go down
potential; demands that throughput goes up.
as
the
daily
It is always
our corpor¬
ate shirt seemed to be
clearly de¬
cided.
there
But
in
this
was
advantage
adversity. Every phase of
the milling problem had
to be
thoroughly studied — roasting,
our
grinding,
the
leaching,
effect
of
oxidants, temperature and aera¬
tion, and the effect of each of
these steps on each type of ore,
carefully explored. The prob¬
was
lems
of
rations
slimes, liquid-solid sepa¬
they
solved.
In
were
worked
thoroughly
were
if
understood,
lems,
upgrading of the
concentrate
until
on
the
and
iniital
immediately
not
extraction
our
prob¬
fortunate in having
we were
the full interest and assistance of
the United States Bureau of Mines
and
our
these
Divisions.
sources
make
Engineering and
Through
own
Laboratories
able
to
evaluation
we
of
were
thorough
a
various extraction processes.
As
experience
our
figures
and the
began to be a
comfort
instead
operating
of
source
up
dis^>
of
We enlarged the plant
may.
pacity
since
in¬
factor
creased, the yield went
have
and
increased
several
the
size
ca¬
times
the
of
operation. At the present time, we
are
engaged in working out
substantial
our
a very
further
expansion
milling capacity.
While
our own
junction
we
of
have recently formed
mining subsidiary in
with
Rochester
Pittsburgh
Company,
Coal
con¬
and
to
guarantee our own supply of ore,
will continue to take ores on a
we
have
how
well known fact that
auto-
we were
custom basis and
Question of Refining Costs
uranites,
carnotite,
torbernite
and
others. There was very lit¬
nite,
many
sighs
accomplished
be
may
I would hesi¬
question Mr. Lennemann's
statement,
when
considered
be
by
unburdened
previous experience in the art of
a
interesting article in
very
near
gineers and metallurgists, knowl¬
ers.
ming
ura¬
nowhere
it is today,
was
had
we
in 1951. At that
are
eitner.
generally
advanced
as
while
carbonate solution,
a
still others resist attack by
Concentrating Process
much for
supply
where a wide
be treated
frequently the avail¬
milling,
of
where
the state of the art of
The
The
Custom
variety
and
in Salt Lake City
nomically bright.
industry
power
adequately fueled for
ship propulsion in the Nauti¬
uranium
being equal, the large
a
tremendous ad¬
have
time,
tentatively classified uranum
into 13 groups, which have
size.
of
will
vantage over the small one.
States Atomic Energy Commission
the
tons
determines
of the mill product, all
other things
mill
govern¬
competition
has
has been reported in the
development of atomic powered
aircraft, I would say the future of
million
when
contracts
of
instead
the price
further
no
support;
poration of America faced when it
started up its uranium refinery
more
had in mind a
mill of 200 tons daily capacity,
which in his mind at least, repre¬
sented
the
minimum
practical
25
ment
widely. The Grand Junction
Operations Office of the United
as
lus, and the fact that significant
for
is
there
and
able
create
fuel than it uses—if all this
more
But
the pedigree of an
alley cat, ana the gangue minerals
that accompany them vary even
complicated
world
are
equiva¬
1,500 tons of coal, it can
seen
should
from
occurrence
standpoint.
financing
William L. Lenneipann, metallur¬
have painted a gloomy
for
stick to
estimate
be
•An
natural
the ini¬
when the industry becomes of age
massive chunks down to particles
currently
If
of
their
completely
been
yet
They grade in size in
recoverable
cepted
lent
not
identified.
can
reason
of uranium is the thermal
Hiroshima.
have
ores
the fact
bodies.
metal.
we
uranium
by
ore
of uranium
at
cated
much
so
theoretically,
least
the
are
are
corner
no
is compli¬
that there are
now
recognized to be over 175
uranium'minerals, many of which
trating
expire,
and the balance made up of
picture of tremendous and rapidly
expanding resources of ore—if I
have overstated the huge potential
supply of secondary metal—if my
We
richest, the most extensive
milling of concen¬
contracts
the better—at least from
Mining Journal" entitled: How to
Extract Uranium From Ores, Mr.
eration schemes and there is small
We know that uranium
an
predication
of
power from the atom disappeared
in a fiery mushroom cloud over
avoid
unit
and
re¬
the cost of nuclear fueling appears
to be approaching that of coal in
the generation or electric power,
estimated
futility
to
are
the
low-cost
new
Economically
caaaaa,
will
informed
am
fuels
exception of Quebec,
British Columbia, and to a lesser
degree in Ontaria, where unhar¬
nessed hydro power exists, Can¬
the fissioning process. Szilard pre¬
tion
pro¬
the
dicted the chain reaction, and in a
little over a decade, Rutherford's
the
peak
fossils
I
nor
of
require¬
Within the
power
society.
our
several
upon
generation to meet her future
split them into fragments.
His
dependent
is
of
task
back before the government pur¬
by¬
industry to make
power
industry
energy
tial
The
plant
con¬
On Future Power Requirements
clear
atomic fire box.
the
when
be a moneymaker.
And if the bororwings can be paid
to
a
as
backed by an infant nuclear power
nu¬
chase
of
promises
of reactors
produce
controlled
long-range future for
complex minerals into an
enriched
metal,
ready for
the
proven
ernment requirement for weapons,
The
ties
easier
much
minous becquerlites and
at
than
backing necessary to build a
concentrating plant comes
new
September 1954 "Engineering and
produce,
more
and
cial
fuel than they
actually
can
faster
in
tnc-
on
the coal mining industry
disposal of ash and cer¬
between
and
back
come
secondary metal
a
ply after
obviously
as
wise to remember that the finan^
the
two; that first step in the highly
complicated series of chemical and
metallurgical processes that col¬
lects and converts minute quanti¬
get the uranium into solution. Ob¬
sume,
government
process
98% of the fissionable material
in
we
consistent with the
was
of
free
concern
is to break down the minerals and
believe our
well, have
I
friends
on
strength
our
on
immediate
concentrating
much
more
fact that certain types
a
Our
the
The metallurgists' first problem
and
reactor. It is
be
we
in
sobering
second,
that
be
the
as
reactor.
new
National self-interest demands
ments of
an
(former
Development of
Atomic
because of
absolutely indestruc¬
tible. A quarter of a century later
Lord
Rutherford,
addressing
a
their
Dr.
bit less
a
than 50 years ago when one
foremost scientists of
the
pects
what
in
highly favorable to
one
Use of Nuclear Energy Dependent
We
kind
produc¬
Hafstad
R.
S.
presence
as
still
Reactor
of
the
never
hunches, which I hope may
a manageable
perspective, but first, I would like
made
government
are
Lawrence
put this problem in
and
artificial
the
bonuses, subsidies and guar¬
few
ergy
of
enterprise economy which
like to present here a
would
few
this
ore?
of
equipped
ore
are
welcomes
supply
stated that the supply
The
once.
industry, is the obvious
demand for a large inventory ol
market
the
use
at
two facts
the mining
may
Supply Increasing
it for
prepare
refer here to the law
may
sion
Uranium
the
supply and demand,
the
feathers."
go
time
reuse.
fact is the
And
must
and
cycle to
unspent por¬
tion of the fuel and
possibility of nuclear propul¬
older
toxic,
reprocessing
decontaminate
the
the
and
consuming
other
in
"ash" of the
plant,
intensely
complicated
a
The
by snorting "horse
require
frequent fuel changes.
power
foremost scientists disposed of
fantastic.
hetero¬
may
more
our
for ships
in
is
spent fuel, the
nothing of
parts of
world, is
effects
This
harnessed by man were quite sure
their discovery was but an instru¬
ment
been
fuel
most
even
nuclear
release of
in
as
irradiation
though the batting average of our
exciting
an
form,
has
—
the
reactors, structural dam¬
to the luel elements causeu by
age
further extension of government
The present state of the newest
Where
genous
activity in the industry.
and
material
solid
re¬
complicated, and recommends establishment of regional
custom
amount—presently
fissionable
concentrating uranium
or
small
lies
neighborhood of 2% of the
consumed.
profit.
at a
ore
reactivity of the uranium
a
in the
and its potential
ore
of concentrating the
means
duce the
Presents facts and opin¬
regarding the supply of uranium
demand, and the
periodically because
the fission products generated re¬
prospects
new
of fuel
ment
Picturing the uranium business as an sxcitiftg one in the
present state of the North American mineral industry, Mr.
,
it.
await
that is the pipeline connecting
scarcity of raw materials.
a
characteristics
Vice-President, Vitro Corporation of America
hold
will
unique advantage for them based
on
Thursday, March 31, 1955
...
we
demonstrated
such
an
conducted at
portant
mulated
a
operation may be
profit. As an im¬
adjunct,
in
feel that we
conclusively
our
we
have
accu¬
Engineering and
Volume
181
Number 5416
.
The Commercial and Financial Chronicle
.
.
(1511)
Laboratories
Divisions
broad
a
technical background in all phases
of
the
from
wide
a
variety of
ores.
With
feel
this
most
valuable,
experience
our
in
of
large
several
other
mill.
own
'Engineering Division
well, along
the
design
the
on
Pointing out only two mining industries—i.
Dr. Pico to be Sec-Treas.
Executive
Government
prices
Director
of
Says international agreements under
stabilize markets has had the
the Puerto
long
Purchase Contracts Expiring
about
the
long-term
the uranium
of
own
in
personal
industry,
hope
that
The outlook for the non-ferrous
my
metal markets
we,
as
in
into this future,
activities
will
cor¬
word,
one
we
sometimes
should
the
the
purposes of
purchase
April 1, 1962
period
security
to help our new
was
is not sound
make
the
this
of
assistance
and get into production as
The
ores
in
next
Dominion
do?
grade of
to
substantial
a
total
time
the
warrant
large segment
a
supply
of
of
portion
Ltd.,
that
ago
The
ore.
Eldorado
Refining,
:some
good
a
mining business and
Crown-owned
;and
have
mill of his own. But
a
uranium
the
many
insufficient quan¬
developed
'collectively,
of
the
the small mine
may
ore but
represents
the
the
of
increase
can
He
^expense of
be
in
years
capacity
should
fold. But what
tities
few
milling
ment
Mining
announced
it would
available
all
ties,
the
Furthermore,
nearby proper¬
few
a
logistics
substantial
of
hauling
ore
and
distances
in¬
the
creased
handling costs through
stockpiling during the closed sea¬
would
son
this
to
seem
plan.
If
weigh against
there
is
no
spare
should the government
■enlarge existing plants or should
•capacity,
it undertake to provide new facili¬
ties?
Obviously, it would be
sumptuous
offer
for
opinion
an
this question
such
on
tion of Canadian
Board,
believe
problem
one
mills,
of
supplies
within
of
Luis
facilities
where
in
the
custom
adequate
amenable
should
ore
radius.
are
Such
be
financed,
erected and operated by the min¬
ing industry itself. Joint ventures
this
of
sort
should
too
serious
without
burden
and would
owners
be
possible
financial
a
individual
on
small
permit
mine
many
ever
be
able
to
do
so
on
their
own. Furthermore, the
join¬
ing of several producing proper-
tics
of
such
on
could
assure
ore
partnership
the adequate
needed
sufficient
the
a
to
justify
capacity
Munoz
Marin.
Mr.
Descar-
as
a
to
grestest economies
basis
supply
mill of
promise
of
opera¬
But this, I repeat, is a problem
that should be worked out by the
owners
whole and
and
not
the industry as
through the ex¬
tension of the government's posi¬
tion in this new industry.
If the mine
become
faces
his
courage,
an
owner
who seeks to
integrated
operator
business
problems with
evaluates
them
with
judgment, and acts on them
with dispatch, he can rest assured
sound
that
the
the
metallurgist
technical
will
solve
problems of profit¬
if
as
at
us,
metals
least,
to
and
has
led
feel
that
not
are
the
shortage will be peronly recognizes its
disappearence when burdensome
manent
Simon
D.
Strauss
this
and
surpluses have developed. The
sociated
with
Executive
'
Director since
Oliveras,
Economic
director
Research
Puerto
Rico
the
Planning
Planning
1953.
of
really
Board.
...
currently
'
'
Board,
All
ap-
-
have
.
Two mining industries
"
miners.
uranium-minine
industry
when the *35 sold nrice
m
fixed
was
efriv thirtie? «T„ 2
the
Descartes
Treasury
Puerto
Rico
Director
search
trial
Rico.
member
a
the
and
markets
Puerto
some
stocks
Re-
Indus-
Development Company.
been
has
Puerto
Puerto
Rico
kico
1942
planning of the
tfoaia
Chairman
and
Government
the
of
miner
The
r\
r>l
L
reporter
on
L
Isidore B.
the
Kamp,
a
trading floor of the American
■
Exchange,
Stock
president
the
of
-Viable
uranium
it
at
The
cost
much
very
of
labor
and
the
item
every
gold-miner
j increased to the noint
DU/S> nas increased to tne point
y 110 caiiy much weight,
In the long run the base metal
industries will prosper most if
they stand on their own feet; to
Pursue the will o' the wisp oF
international stabilization schemes
can lead only into marshy ground,
Such schemes would invite gov-
eminent control of production asw<rn as Price aild in the lonS rurl
might spell the doom of true
Private enterprise in mining,
Bavidson-Vrnk-Sadler
elected
American Stock
was
to
it,
get
as
assistance.
tralia
trana,
far
so
thp
the
neire
asks
In
Canada
nthpr
otner
ainnng
among
he
has,
and
for
Aus-
rmintripc
countries
hp
ne
~
1S
" grudSlng asslstance- doled out
meagerly as a relief check.
The
uranium
governments
officers
elected include,
Gaudino, Vice-PresiJohn W. Gilfillan, Secreand Wimont H. Goodrich,
dent;
tary;
Treasurer
.
Mr.
a
began his
Kamp
career
as
page on the trading floor of the
exchange
1925.
in
with
been
the
twenty-five
exchange for
or longer.
The
of
eager
wjde
trend
toward
The
inflation
world's
no
SANFRANCTSCO
SAN F R A N C I S C O,
Ronald
E.
San
the
change,
to
of
Calif—
Calif.
Kaehler, President of
Francisco
announced
Stock
the
Ex-
elections
membership in the Exchange,
Richard P. Gross, general partof
Stone
&
Youngberg, and
Malcolm
Skall, an officer and
voting stockholder of A. G. Becker & Co. Incorporated.
ner
Both
new
members will
Specialist-Odd Lot Dealers
Floor
of
the Exchange.
TT
To
revert
are
the
the
to
the
act,as
on
the
of
the
for
base
.,
Of
different
schemes.
a
firm
in
also
St
fifl. 10 AtSllllft
mains 10 be said about the out-
New
J°°k.
As indicated
^cePtion of this
clear.
mat
Stock
Exchange
change
the
is
snorta*e nas persisted
one
change
to
partnership.
Mr.
are
faced
costs and
deposits
than
of
most
with
are
lower
of interruptions to supply
a series
suppiy will catch
demand
it
as
sb+u+ed
up
Thereafter
will
coDoer's
deoend
on
OHJP"-w "depend on
maSf-tnd
puestion
of
Customers Brokers Elect
con-
&uiuieu. i n e x e a i t e i , Luppei a
ability to find new markets for
'
outout
Southern California
with
presently
is
that
may
to
price
a
be
a
major
LOS
ANGELES,
Calif.
to
foreign
——-
think
in
r>rnkprc
Association
1f10K5:r1s1 Association
the
has
nas
following officers
Tenaglia,
of
_
,
.
Jpd£«ss ^ Develop™"/Assod"
~
tion, ~
Toronto, Can., ""
March 7,
"■
1955.
elected
ucutu
for
1955:
Shearson,
Hammill & Co., President; Gustavus Dann,
Sutro & Co., Vice-
f7ead
on
zinc have been lean-
and
the
crutch
0f
government
This advertisement is neither
of
an
offer
to
buy
is made
any
tary; Edward
Ziegler, Dean Wit-
ter & Co., Treasurer,
an
offer to sell
nor a
solicitation
of these securities. The offering
only by the Offering Circular.
March 30, 1955
EW ISSUE
12,500 Shares
INDUCTION MOTORS CORP.
Common Stock
(Par Value $1
per
Share)
Price $6.75 per
Share
mines.
terms
The*
,
content
They
higher
jmp0rt
duties,
import
quotas,
stockpiling, or even outright subsidy. Outside the United States
many of the raw-material produc¬
jng countries are strongly in favor
tend
—
^
'.i,*
California
Customers
Southern
President; George Harder, Secre-
extent
very high
exploiting ore
metal
Mo
becau^of Dammes, ICoerner & aMcMann. in
partner
oecause oi ??ann was formerly
the
wage
on
at
wperdsted
jng
York
the very April 1 will admit Raymond A.
talk, it seems McMann, member of Ihe Ex-
pro-
ducers
?
,
lot
In
a
„
Petersburg
Hardy & Co., 30 Broad Street,.
New York City, members of the
of
United States the domestic
se¬
has
ui,u
R. A. MaM !0 Ftilfl
,,
.
metals-
assurance
xorm-
Beacon
the
in
01Uce m &t- retersburg,
/
deVel°P'nS
■
.
subject of this talk
desire
offices
Having described-~the non-fer10u.s metals markets, what re-
for
certainty,
which
—
New S. F. Exch. Members
con-
appetite
uranium
may
not
prove »to
be
insatiable either. All one can say
with certainty is that there really
is
Position
today
ous one- But what will it be 10
years from now if the price remains unchanged and if the world-
years
club now has a membership
sixty-seven employees.
as
for atomic strength as they were
once eager for gold reserves, the
reward to the uranium miner in
te™s of today s costs is a gener-
tinues?
The Quarter Century Club, organized in 1946, is composed of
all exchange employees who have
are
with
»Te
*'Serials Td" the
mateiiais, ancl tne
otner
has been given assitance—but it
as
Davidson-
Vink-Sadler, Inc., has been
office
he
w
dnwrnmpnt
government
ing March 23.
X.
to
Ihe
Jy inc..eased and in the long
Exchange Employees' Quarter
Century Club at the annual meetOther
?anSu
un-
than
So the gold miner asks
a nigher price. When he fails
miner, today, is
better
off. His price
has
been
more
recently set and because
Francis
rather
Formed in VMsIa
<
frYp_
wnicn could not nave oeen mm
have
profits
con-
ask for government in-
-
largely
the
were
other
thp^mawinH 1w
t^ej may find that once the mter^occurs the!r own wishes
c°PPer> lead and zinc markets re- branch'
fleets not only these governmental' Eia"™
to.
in
of
S°ld and the inter-
The
as
more
among
decisions
basis
curities.
vanished
is
University of
n
L
was
the
case
ed
present
supplies of freighband equipment,
thpn
men
Acr
way
boom
been
looks
He
™953.
every
recently.
But over the years the gilt has
been rubbed off the edges of the
$35 gold price and today the gold
where
Rico.
Puerto
has
Bank
Develonment
forPuerI oR i tos ince
graduate
Board
in
the
as
askance.
Chairman of
Planning
which
He
Depart-
Rico
sued
about
concerned
contentment
The
Building in deal in investment
gold-mhring^tocks en?
A boom in
the
of
Economic
Information
the
Dr. Pico
thr»
tne
gradu-
a
Planning Board and
of
of
ment
is
Puerto
formerly
was
1949,
since
^erSTo!'
University ot
Secretary of the
on
of
armaments race
in
the
of uranium. If the base metal
industr;
re-
the stabilize them.
pointments will become effective
Mr.
-
the whole tended to
on
stabilize
4
fhe
not
state
An
suit has been that the ameliorative
1
o£
Chairman
as
future.
the
Division
will succeed Dr. Pico
of
Re-
J
Candido
the
Water
Authority since 1935, and
sources
its
the.
as-
and
permanence
the, prices
But note that
siderations—international finance-
ceitainty is usually expiessed in activities of governments, which
terms of^a wish that prices would may have been sincerely under*e^3in at pi oiltable levels foi the taken out of a desire to be helpful,
indefinite
retiring after having been
for
profitable prices has led to
mine
base
of
is
tion.
a
which
feel
Among
mlners
of
regard
control
a
shortage develops in a given
market, d government tends to act
can
sufe>
in
with
years
government
quick
to
recognize changing conditions in
commodity
markets.
And
even
after
they have recognized
changes, they are slow to act. If
They
Descartes
made,
to
be
direction
desire
of
them to start producing a market¬
able concentrate long before they
would
Mr.
it
government
15
with
setting these prices governments
have
tes will succeed Carl A. Bock who
this
found
economic
an
succeed
necessity
last
and
case
agreements,
governments
jhings,;' s°me~
AbL Quarter Century Club
j
vx
to
regional
located
to
the
gold
national
nat,n"a'
participation. The experience
some
do
Chair-
appoint-
Pico,
Rico
of
on
dealing
with
Planning
and
Rafael
Puerto
announced
were
emphatic
answer
be
may
establishment
to
in the States,
an
May,
Dr.
of
to
would like to
have a fixed
scheme of
Authority,
Secretary of the Treasury was
March 29 by Governor
as
since
ques¬
policy, but
raised
my answer would be
■"no."
I
a
in
of
pre¬
American
an
to
away
Descartes
and
happy
the
commodity agreeproduction and
apwmpnfs
ac¬
capacity.
but
Resources
of the
man
cept custom ores but obviously
there is a definite limit to the
Tor
L.
S.
Pico
Water
effective
proven
the
uranium
•owner
here
supplies of
moving in this direction,
are
and
properties
with
in
were
control
Surh
both
that have been set.
auspices to
stabilize prices.
based
for
change.
Rico
larger
Canada
Rafael
rapidly
possible?
as
Dr.
to
would
for
would
like
business judgment to
most
ments
is
many
people
industry get itself established. Is
is
the
search
until
word
worse.
In
extending government
contract
that
up
sometimes
and
Change
for the better,
respondingly
decrease
but
recognize that one of
be summed
can
"change."
move
government
ouite
are
the
of international
of
the moment
gold miners
unhappy and uranium miners
are
feet.
own
.prices
uranium have been set by govern¬
ment. At
made
future
business, it is
their
on
In connection with what I have
said
again, occur.
The
Concludes, in the
the base metal industries will prosper if they stand
run,
foi*
grounds
,
effect.
reverse
indefinitely, but
exist
demand—in that event imbalance
may
e.
government
to
seem
that, now that stocks have,
been reduced,
supply and demand
will be in fairly good balance. An,
increase in prices that will greatly
stimulate supply may also curtail
and other operating costs, accompanied by fluctuating
due to foreign competition and changing demands.
wages
Appointment of S. L. Descartes,
Secretary
of
the
Treasury
of
Puerto
Rico, to the position of
few months. This''
a
go on
hope
gold mining and
uranium mining—currently have a
price certainty, Mr. Strauss
holds present problems of domestic metal
producers are high
of Puerto Rico Auth.
hardly
thera
By SIMON D. STRAUSS*
Descartes Exec. Dir.
for
as
can
Metal Market
rank
mineral
Plateau
mining industry of Canada
of
will
the
in
none
stockpiling for
Vice-President, American Smelting & Refining Company
phases
well.
Problem
decade
next
business*-1*
operations of the Dominion.
Our
and we are
offering this sort of
engineering service to the urani¬
The
to
is currently
scale- mills
companies
second
effort, I
uranium
Outlook f or Nozt-Ferrous
of operating
years
in
the
of team
sort
the
sure
within
We
have
supplemented
this
know-how with our hard-won but
high grade mill
a
concentrate.
chemistry of extraction of
uranium
um
ably producing
19
Copies of the Offering Circular
C. E.
61
may
be obtained from
Unlerberg, Towbin Co.
Broadway, New York 6, N. Y.
20
The Commercial and Financial Chronicle
(1512)
depreciation of the
a
Pros and Cons of Another
would
be
pend
currency.
such
Suggested Revisions oi the
psychological
a
Thursday, March 31, 1955
...
It
risky, however, to de¬
on
.
effect.
General Election in Britain
Sir
Churchill
Winston
By PAUL EINZIG
immediate
the
future.
Government will
Dr Einzig, in discussing the controversy in
England regarding
hand
general election, finds that the Prime Minister, Sir Winston
Churchill, is faced v.ith a dilemma. Points out split in the
Labor Party would offer opportunity to the Conservatives to
majority, and in addition there
strong economic argument for
next six months it is
to
probable there will be
Mr.
LONDON, ENG.—A fierce bat¬
tle
is
raging
favor of
and
between
in
those
early general election
who would prefer to
an
those
wait
the
till
autumn.
It
is
natic
behind
the
the
of
Cab¬
ployment the remedy is apt to be
ineffective.
Possibly
the
tain
1 0
Downing
and
decision
with
rests
after
Winston
Churchill.
His
Ministers
and
other political
Dr. Paul Einzig
su(o porters,
and the Conservative
newspapers,
But it
the
for
with
the
tion, the
the
rising
the
be
would
election
has
of
of
a
consump¬
balance of payments
liable to
is
remain adverse. For the
_
are
sharply divided
the expe¬
on
diency
of
the
hand, there is the political
one
rushed
a
election.
On
argument of the troubles in the
Labor Party,
and the economic
argument
of
the
possibility of
this factor
offset by the influx
funds attracted by
rates, and by some
inventory
stocks
present
is
more
than
of short-term
high
interest
reduction of
enforced
by
high interest rates. But these fac¬
tors
apt to be temporary, and
are
the
in
"hot
long run the increase of
money"
and
the
running
tions by the autumn. On the other
down
of stocks
hand, it is arguable that the split
between the two opposing Social¬
modities is liable to react against
deterioration
ist
factions
the
is
Bank
business
liable
of
course
high
of
to
time,
rate
widen
have
pro¬
duced its beneficial effects by the
autumn.
The opponents of an
tion
have
the
won
There is to
be
early elec¬
first
round.
"snap", election
no
before
the Budget, nor has the
Budget date been put forward for
of imported
com¬
More
important
than
considerations
these
is
longation
of
of
any
be
the
pro¬
election
an
tomorrow,
the Conservative Party would in¬
its
crease
prophet
the sake of earlier election. April
19 has been fixed as
Budget Day.
This
majority.
would
months'
No
be
just
possible to rush through the Fi¬
Bill
nance
election
general
week
of
be
not
done,
time for having the
in
during the last
though it would
May,
Unless this could be
Prime
probably prefer
tion
to
the
June
a
Minister
would
autumn elec¬
an
election, owing to
disturbing effect of the holi¬
day
and
of the
beginning
the busy season in agricultural
of
season
areas.
result of
forecast
if
even
we
disre¬
to
were
in
election
an
seems
to
nomic
argument
be
a
strong
very
in
early election. For it
eco¬
of
favor
an
prob¬
seems
able that the next six months will
witness
than
deterioration
a
improvement of economic
an
conditions
lar
it
will
rather
in
seems
be
Britain.
probable
substantial
a
during the
In
particu¬
that
loss
there
of gold
It
argument
tion,
that
favors
the
an
irrespective
economic
early
of
elec¬
whether
or
the high Bank rate will
pro¬
duce its desired effect. For the
not
only
possible
Bank
rate
in
way
can
consumption
through
which
reduce
and
the
excessive
imports
would
be
creating a
certain
amount
of
unemployment. And
even
a
slight increase of unem¬
ployment would mean the loss of
Should
is
seven
bound
be
to
on
transferable
face
of
such
they
would
authorities
sterling in
selling pressure,
a
of
crease
wages
unemployment
spiral
increase
the
would
of
the
continue
to
inflated
power of consumers
spite
in¬
an
the
purchasing
in Britain, in
high
Bank
rate.
Towards the end of
February and
the first half of March, wages
claims amounting to well over
£120
million
per
annum
have
in
been
conceded.
In
face
of
this
wide
underwriting
of 173 investment banking
and
-
dealers
headed
jointly
bv Lazard Freres & Co. and
riman
Ripley
Har-
&
Co., Inc., on
March 29 made a secondary offer¬
ing of 464,700 shares of common
stock
of
Corning Glass Works.
The stock was priced at $58.75 per
share.
The
shares
do
new
financing by
and
the
the
will
proceeds
Included
being
Corning
company
of
sold
constitute
not
holdings
of
shares
portion
a
of the
the
from
the
among
are
Glass
receive
Amory
of
the
Houghton,
Board
basic
civil
Conscription
for
inevitably lose hun¬
large part of the credit
they claim for the achievements
a
their
administration.
Should
Exchange Equalization Fund
abstain from bolstering up trans¬
ferable sterling, its rate would de¬
preciate
considerably.
This,
in
addition
to
being bad for the
Government's
prestige,
would
lead to a large-scale revival of
"commodity-shunting" operations,
which again would entail consid¬
several
company,
close
relatives,
and of estates and trusts of which
two
men
trustees,
are
gating approximately
shares owned by
Mr.
Amory
the
aggre¬
12%
this
of the
group.
Houghton
"sale
the
of
advisable
deemed
stated
shares
in
where
trusts
the
was
light of
continues
in the vari¬
Corning
to
Glass
constitute
the
erable loss of gold.
company
bearing
has
a
annual
an
Moreover,
anticipation
in
of
devaluation
or
a
of
sterling under a Labor Govern¬
ment, overseas buyers of British
goods
would
defer
their
orders,
they would at any rate defer
payment for the goods, in the
hope of being able to pay with
cheaper
sterling.
This
again
would lead to heavv losses of gold.
It is no wonder that pressure is
brought to bear on the Prime
or
Minister
to
the country of
unfavorable
developments
such
spare
deciding in favor of
an
early
share
a
total of 6,-
cents
share,
a
currently
dividend
of
an
early election,
their part, argue that a flight
from the pound might produce a
$10,000,000
of
$1
or
paid
annually,
the common
stock.
In 1954 dividends equiva¬
lent to $1.20 a share were paid on
are
on
presently
outstanding com¬
stock, including a year-end
extra dividend of 80 cents
a
share.
Net sales of the company during
the
year
ended
Jan.
2,
1955
amounted
income
to
to
$147,938,842 and net
$17,490,191,
share
a
vidends)
standing
The
equal
to
(after preferred di¬
the
on
presently
out¬
stock.
common
Barry Con¬
Watertown,
prob¬
Massachu¬
because
some
setts,
do
that
M
n
facts
of
grim
times
have
compelled
the
Civil
Liberties
recognize the imperative
Union to
claims imposed upon us
all by the
necessity to maintain our national
security. In time of war or under
imminent threat of war,
it has
seemed generally evident to our
the fairest and
citizens that
efficient
most
to provide military
way
forces is by means
of conscription
and
the
assignment
of
men
through Selective Service.
in
1940.
In
for
case
Civil
American
the
draft
did
not
which
was
that the
military
1945, it felt
compulsory
in
of Paine,
Webber,
Jackson
company's
chairman
of
the
board,
and
others.
Corning Glass is engaged
primarily in the manufacture of
glass products having special
Qualities
with
ment's
effect
on
the
Govern¬
electiort
prospects. They
believe, that it would frighten the
electorate into voting Tory, in the
same
for
way
fear
as
that
hanpened
the
in
return
Socialist Government would
1931,
of
a
mean
in
1945
electrical
mission
as
and
imminent,
and
although
clearly it lies beyond the com¬
petence of the ACLU in the name
of
freedom
in
earlier
it
cepted,
products
signed to comply with specific
tronic
ucts,
de¬
re¬
Its products are broad¬
as
electrical and elec¬
products,
and
products;
mea¬
oppose
service
which
emergencies it has ac¬
does have a right to
things:
In. the current emergency
which may require conscription,
the present Selective Service Law
should be revised to give more
(1)
protection to the rights
The sincerity of
generous
conscience.
of
conscientious
be
objection should not
by
the
test
of
a
judged
religious formula
exclude ethical
narrow as
so
to
technical
they
ordinary containers
and
not
do
or
prod¬
other
include
flat glass.
ware
sold
under
the
well-known
P.
Gardner, Jr.
pany,
the
of
trustee
a
and
Provident
Institute
a
the
of
He
is
ton
the
of
Savings.
for
President
also
Amoskeag
trustee
Company,
Bos¬
Museum of Science.
isolation
initial
its
vi¬
It
issue
public stock
beginning of March.
the
at
and
equipment.
of shock
manufacturer
bration
had
is
Controls Incorporated
Barry
a
Merrill
Lynch Places
Five Secondaries
Pierce,
Lynch,
Fenner
& Beane and associates on March
five
made
23
secondary
common
quick¬
These were:
stock offerings, which were
ly oversubscribed.
Approximately 27,000 shares of
Petroleum
Corp.
at
Amerada
$207.50 per share, less a
20,000
shares
at $60.25
Corp.
$1
$4 con¬
dealers;
cession for
Barber Oil
share, less a
of
per
concession;
31,000 shares of Dow Chemical
Co. at $46.50 per share, less 70
cents per
share;
29,000 shares of Olin-Mathieson
Chemical Corp. at $52.75, less 85
cents; and
7,000 shares of Louisiana Land
6
Exploration Co. at $77.25, less
$1.10
per
share.
first
The
four
offerings were
York Stock
cleared
World
American Stock Exchange.
War
to
permit sincere ob¬
jectors to render useful service to
them
(2)
rather
in
than
confine
to
scription is
We
con¬
an emergency measure.
believe
that
extended
an
and
New
the
fifth
Edward F. Beauchamp on
7
will
acquire
the
New
and
on
York
the
same
Stock
to
partnership
accompanied by a universal
military training law. The latter,
chamn
&
West,
should
be
the
way
psychologically
for
totalitarian
practices, and to become accepted
as a regular feature of education,
liberties,
even
in
to
prepare
times of
Selective
peace.
New York
115
in
Beau-
Broadway,
City.
Kerbs, Haney Partner
April 7 will admit Arthur G. Lo¬
gan to
limited partnership.
is obviously
a
particular
it
should
made
be
compre¬
very
hensive. Man's ability to abandon
conscription will be
a
measure
of
E. H.
Donald
New
Stern Admits
Stone,
York
statement
House
filed
Armed
by Mr. Malin
Services
with
Committee,
1955.
Washington, D. C., March 23,
member
Stock
of
Exchange
the
on
April 1 will become a nartner in
Co., 11 Wall Street,
New York City, members of the
New York Stock Exchange.
E. H. Stern &
*A
in
Exchange
Kerbs, Haney & Co., 38 Broad¬
way, New York City, members of
the New York Stock Exchange on
intended for
emergency, even if
the
April
date will be ad¬
mitted
law
the
membership
a
not
Selective Service
by
Beauchamp, West Partner
Everything possible should
be done to make it clear that
the
by
Exchange
jails.
Consumer products include glass¬
Pyrex trade-mark.
G.
United
Com¬
liefs. A way should be found as in
Great Britain during the Second
Service
consumer
the
of
Fruit
humanistic be¬
or
of militarism hostile to democratic
glass
quirements of fabricators in other
ly clasified
to
now
selective
for
sures
mechanical strength,
technical
firms:
director
a
and
in the light of history, would seem
far more likely to create a spirit
resistance,
and
although
1947,
or
three
Boston
Merrill
stability,
light trans¬
chemical
of
on
favorable
than
is
connected
of that year,
its resolution
and
Curtis, and
oppose
adopted
training as essential to national
security was by no means strong
enough to override the grave ob¬
jections to
conscription in the
name
of liberty. This fact is set
for
the
firm
the
troubled
our
part-
a
brokerage
However,
conviction.
n-
Gard¬
.
in
e r
Patrick M. Malin
-
religious
philosophic
or
r
is
ner
opposed
•
by
a
nounced.
to
whic h they
are
has
been
to
m e n
society
origin
traces
back to 1851 when a glass business
was established by Amory Hough¬
ton, great grandfather of the pres¬
ent
George P. Gard¬
of The
member
a
Incorporated.
ask three
industries.
Opponents of
and
Regular quarterly dividends of
$2.59
as
of Directors of
peril to national security is great
holding."
647,520 common shares outstand¬
ing, in addition to 76,760 shares of
$100 par value preferred stock
the
Jr.,
Board
Union
mon
forces.
trols
law
25
armed
raises
war
the
$3.50
gold reserve would
deprive the Conservative Govern¬
the
preparation
Liberties
3%% income debentures due 2002.
the
in
ner,
Corning Glass, and Arthur
Houghton, Jr., a director of the
cline
of
Everything possible should
The election of
or
war
A.
ous
both
Gardner Named Director
liberty.
tors of
that
maintain
tion
Hence,
the
(3)
to
freedom.
a
Direc¬
of
dreds of millions of dollars. A de¬
election.
of
nation
group
none
and
denial of what
it constrains
Common Stock Offered
sale.
capacity
peace
complete
ought to be
lems
Corning Glass Works
firms
his
be done by Congress to eliminate
the remaining racial discrimina¬
special
A
emergency measure,
for
The
British
the
support
bv
absence
would
course
entail.
the safe side.
ment.
the
that
government
con¬
lives is a
individual
of sterling would prefer to
millions of votes by the Govern¬
In
defer¬
a
of
most important
depreciation
seems
favor
till
that
scription
stock
and early au¬
summer
tumn.
definitely
odds
position
the
autumn, and most foreign holders
There
the
there
ways,
the
case
Liberties
consistently taken
Although we now face a very
different set of facts and problems
in
both
that
has
which it reaffirmed in 1947.
of
cuts
Bill, it would be
Union
Civil
additional flexibility
gard the political argument, which
fact
less
or
American
an
remaining discrimination in the armed forces.
remove
uncertainty
and
suspense
throughout the summer and early
time.
ment of
Yet,
more
The
protection to rights
more generous
make it clear law is
the present tax structure to secure
easy.
the
In
vantages
political
to
dare
be
that it would
means
the
his
October, irrespective of
the political and economic disad¬
the
uncertainty
through a deferment of the elec¬
tion until the autumn. Most polit¬
ical prophets agree that, should
there
by
of
course
a
Chairman
sterling.
in
that the
and
may
a
condi¬
would
ment
until
become
absence
curtailment
marked
clear
April 19. Should
on
and to
This
the end of hopes or fears of a May
election.
of conscience; to
rushed
time.
made
the
Finance
Selected Service Law to give
1929
cer¬
a
Government
result
In
,
in
check
such
evident.
of
unemployment,
would
wait
to
Sir
—
of
wages.
of
inexpedient
man
one
only
might result
this
in
foreshadow
normal
of
effective
amount
trend
increase
coupled with a
tightening
rate,
more
credit,
at
further
a
Bank
much
of
room
The
all-curing
high Bank rate had to
that
amidst overfull-em¬
admit
inet
Street.
the
in
of
effects
fought' mostly
closed doors
believers
fa¬
most
be
to
Budget speech
the
of
some
Director, American Civil Liberties Union
Spokesman for Civil Liberties Union advocates revision of the
necessary
was
record
Butler
he
even
Executive
non-controver¬
Bill
in
have
would
be
procedure
Finance
through
British economic conditions.
fact
By PATRICK MURPHY MA LIN*
the
have to show its
brief and
a
sial
deterioration in
a
the
repeat
when
to be a
seems
But
Budget Day. In order to
on
of May it would
end
early election, because in
an
Selective Service Law
not
be able to go to the country at the
a
increase their
is
likely to indicate his intentions in
/'
Volume 181
Number 5416
The Commercial and Financial Chronicle
(1513)
\
A
How
of confidence-with Living insurance
new era
Equitable helps
more
families than
out
more
benefits than
retirement income,
ever
achieve
a
growing self-reliance.
in
ever
family and
our
funds for children's edu¬
cation, medical, business and financial
thing Americans value most:
personal independence.
They want to stand on their own two feet.
And
they
able
to
one
want
do the
their wives and children
same
—
always. The
to be
ahead
years
(jan look bright and secure .to the man who
plans for them in his insurance program.
During 1954, The Equitable spread
an um¬
brella of protection over more families than
ever
before in its
history. And, Equitable paid
8,200,000
men,
and children.
women
entire U. S. economy.
The Man from
The
figures are people — like you and your
neighbor — sharing the risks of life together.
of confidence into
your
—
See the Man from
millions of families
—
and at the
today!
any
Equitable Agent,
Per Cent
U. S. Government
obligations
Canadian Government obligations
Public utility bonds.....
Railroad obligations
Industrial obligations
$
520.604,119
70,780,092
926,974,722
713,293,183
2,223,918,818
,
RAY
of December 3b 1954
as
Policyholders' Funds
Per Cent
To cover future
( 6.9)
( 0-9)
(12.3)
( 9-4)
and
Held
payments under insurance
annuity contracts in force.....
for
(29.4)
Dividends
and
annuities
left
on
( 2.2)
21,462,269
( 0.3)
1,525.388,857
(20.7)
292,962,592
( 3.9)
Dividends due and unpaid to policyholders
11,628,620
( 0.2)
Allotted as dividends for distribution dur-
175,793,694
( 2.3)
Farm mortgages
Home and branch office buildings
!
holders
222,298
(
-
)
( 0.1)
( 1-4)
29,001,000
( 0.4)
13,773,767
Taxes-federal, state and other
( 1-0)
106.479,864
( 1-4)
174,842,375
60,647,150
( 0.2)
( 1-0)
j
( 0.8)
61,270,193
( 0.8)
To
$7,550,707,777
Total
( 12)
8,616,094
110,250,726
ing 1955
(100.0)
Total
Expenses accrued, unearned interest and
other
obligations
Mandatory security valuation
( 2.3)
Interest and rentals due and accrued and
other assets
89,854,178
Other Liabilities
78.894,425
Transportation equipment
Loans to policyholders
Premiums in process of collection.
Society at interest
Policy claims in process of payment
Premiums paid
in advance by policy¬
es¬
tate purchased for investment
Residential and business properties...
Other Assets
( 0.5)
deposit
( 5.7)
165,809,642
Mortgages and Real Estate
( 2.7)
37,620,944
and
429,734,861
with the
(81.4)
( 4.9)
202,694,837
policyholders
$6,156,829,491
369,451,593
deposit
on
beneficiaries
Ctlier bonds
Residential and business mortgages
MURPHY. PRESIDENT
by writing to the Home Office,
or
Preferred and guaranteed stocks
Common stocks
D.
OBLIGATIONS
*Bonds and Stocks
reserve
74,358,129
Surplus Funds
njrtcliutinrj $(1,682,126
accordance with
—
time
same
help create jobs, produce goods and maintain
Condensed Statement of Condition
In
Equitable
They show
moment.
RESOURCES
Cash
policyholder and the
' \
double-duty dollars. These dollars protect
A copy of the President's Report may he obtained from
Housing developments and other real
these dollars work
can bring a new
home. He can help
you help yourself to a bigger portion of selfreliance
the Living Insurance
way.
shown in the annual statement below. Behind
a
—
Equitable
era
these
figures
industry
for the benefit of the
of their confidence in the future is
Look at these
—
business and
emer¬
Today The Equitable family numbers
measure
high standard of living. Invested at the
$22,000,000 a week
in farms, homes,
rate of
gencies. This is Living Insurance at work!
There is
cover
all
contingencies
468,257,018
( 6.2)
$7,560,707,777
(100.0)
on deposit urlth public authorities.
requirements of law all bonds subject to amortization are stated at their amortized value and all other bonds and
stocks are valued at the
as prescribed by the National
Association of Insurance Commissioners. In addition, as
required, a security valuation.
market quotations on December 81.
1054,
is included among the liabilities.
reserve
THE
1 LIFE ASSURANCE SOCIETY OF THE UNITED STATES
EQUITABLE AGENCY MANAGERS AND
Home Office: 393 Seventh Avenue, New York 1, N. Y.
GENERAL AGENTS
IN
NEW YORK
CITY
A. BIEETSTEIN
JOSEPH
112 West 34th Street
225 West 34th Street
MONROE W. BLEETSTEIN
MILTON
855 Sixth Avenue
50 East 42nd Street
MYRON
WILLIAM
J. BROOKE
E. W. REJAUNIER
HORACE
450 Seventh Avenue
295 Madison Avenue
H. COHEN
101 West 31st Street
120
21
V. DAVIS
WEINER
J. DUNSMORE, C. L. U.
Broadway
LEO
EiSEN
SID
SMITH
MAXWELL
450 Seventh Avenue
120
ALFRED A. HARRIS, C. L. U.
MAX
75 Franklin Avenue, Yonkers 5
Times Bldg., 42nd St. and Broadway
JOHNSTON, C. L. U.
8 West 40th Street
i
;
Broadway
M. SHAFFRAN
225 West 34th Street
REIBEISEN
EDWARD
»
R. SIEGEL
21 East 40th Street
r
'
,
*
H. WILSON
f
In
The Commercial and Financial Chronicle
(1514)
22
values
estate
Advice to Retired
People
which
localities
discusses
attractive
are
to
to
people.
and used
ment
time
of
the
to
as
live from people about
Eioned.
are
They
to favor Florida,
Califor-
seem
What
Arizona,
ma,
about
This
is
certain
and
other
are
S
thern
not
should
o
u
tially higher than present heights,
in 1953-1954.
subject to the probabality of intervening
reactions.
But
his
chance of eventually holding on
to the profits he makes beyond
the current level, we should term
no better than in former bull
markets — and that is none too
of this large group lagged behind
the blue-chip advance until July,
1954. Recently the rise in secondary issues has more than kept
to
appear
tiring
of
in
and
just
sale of
winters.
which
^jon
te
be
the
un¬
state
all
The
summer.
also
is
tages
,7
v
alter
m
ence.
nnLe
mns
I
I
i
no
A
in
A
air
ye
less
for
Business
min00
mmee
ogden,
This
and
order
|
prospects
for
tics
-how that the most
intelligent
England
The
on
farms and cities and built
inany
laiiroadsTcross
aaitroads
the 1United States
United Mates.
across
of Income
Importance
states
California
Florida
as
find Adzona does imt stenvHom
hahipq
l(PW
n<rHriiltnrnl
nr
of
role
speculative
Tn
r~v
quite
emphasis
I
.*
whether
any
feasible.
Speculation has not
bright business
desire to have
(1)
and
add to stock
in
about the
a
hand
on
to
cover
Average
to
levels
years.)
public
substantial
the
of
was
pre-
prior
But
to
expecting
setback
and
to
have
scarce
if the
inclination
materials
on
might become more
that
hand
situation
were
to
become
a
this
was
reversed
Chester F. Ogden
Regardless
be
the
of
reports to
other sources,
some
contrary from
the
and< gave
ment
that'
tide
en-
buy
This
we
no
change
senti-
of
have
sentiment
in
to
nrn-
are
more
than
weaker
nqw
duced a change in the public's
in
strict
reported
as
last
month,
the
in-
concerned about the extent -of
speculation. My reason isl that it
tessionais
average.
10
that
note
est
on
bonds
Social
mortgages
or
"hecks
Security
help, but
ihey will not pay all the bills in
nny
state lo which people are
now flocking.
Don't
expect
are
a
ing costs in these delightful winier
climates.
«o
much
ing
ing
who
You
not
may
need
1954,
compared
as
are
still
tive aiutuue that was reported
attitude nidi wcta icyuncu
last month. However, there still
is no rush to buy into*the future,
ing'"upward' "with Evidence'"of
or
clothing, but food and rents cost
as
much, considering what you
ventory position and buying policy has lengthened a little. Em-
£et
doctors'
bills;
are
or
is
dentists'
whil?
hospital
or
beauty-parlor
bills
reported to be higher!
ida does
in
reduction
no
Flor-
give homestead tax
ex-
"nber- 80^' |arfthin,Ee
property
on
000.
Different
have
different
to
up
states
ways
and
$5,cities
of collecting
taxes, but in the end they add
to about
the
up
Job
or
a
Many retired
a
,
;*,et
while.
,
worK
you are
men
.
...
trained.
business
of
your
job,
~
jv«,
.
something
in
restless
get
If you want a
.
,
which
in
If considering a
work
own,
salary before buying.
on
Caretakers'
Service, Collection Agencies, Tree
WnrcpHpc
Nurseries,
nianpr
Diaper
rozen-Food
c
0
r-
-.r
i
r.«
o
Services,
Deliveries,
Clothes
^
31Q
iq2°
.
■
1<m
dpr]ined
and
reports,
In
their
low
very
as
1
51%
the
This
compares
in
up
to
February
However,
on
special
on
some
items,
cotton, sugar, and pork, the
ket ls soft
years
is a
to
willing-
inventories.
This
18x
20
21
22
2.46
163
43
21%
3.42
99
(1938)
28%
34
4.69
41
(1932)
16
16
4.58
212
High..,
194
1929
High
381
25
1927
High.
202
14%
.19%
2.95%
(1916)
(B)
General Electric Common Stock
n
1955
(Feb.)
____
167*
Subsequent
Earnings for the Preceding:
5 years
23
28
38
High_.
52
26%
30
65
42
84
1929
101**
45
60
85
36**
23
29
34
Street, to engage in
a
se?uri-
♦Multiplied
by
8
to
reflect
1954 split.
**Divided
by
4
to
,
33
(1946)
27%
51
York, Jr., has formed York &
Price
,
31
High
High
1927 (High)—__
Low
ID years
1937
ties-business.
Average
15x
1946
ery
Low Price of
Ratio to Average
definite indication of Co. with offices at 23fr Montgom-
Purchasing :Executives'
to add
er
Subsequent
on
(Moodv's)
vears
SAN FRANCISCO, Cal.—Palm-
Inventones
.
There
0
10
15x
High
__
1 year
York & Co. Formed
mar--
.
mi_
ness
414
(March)
Price
-
Stock
AAA Bonds
Earnings for the Preceding:
1 year
,
including
Yield
Ratio to
Date
$T
petition continues keen. Furthermore,
this contention, and I shall have
Dow-Jones Industrial Average
Price
York City, members of the Amerimost items, ex- can stock
Exchange. Mr. Atwell
situations such as was formeriy a partner in Jay W.
copper and some steel items, com-
large
There is some merit in
profits.
(A)
.
.
cep
"unfreez¬
showing
Average and for General Electric Common
1937
John R. Atwell will be admitted
to partnership in Samuel Abrabams & Co., 25 Broad Street, New
same.
the
in order to increase
holdings
ing"
against earnings prior
1946
same.
of
jtax be. abolished
u„r^d. in two,
«»»t
cut
the supply of stocks by
were
1955
36%
48%
Prices
made
Certain Price-Earnings Ratios for the Dow-Jones Industrial
Broadway, New York
members of the American
March
hi?!^rlnd_59.% s*Lthey are ge?"
of
" J,
0
Gains Tax
been
has
CaPital Gains Tax as a deterrent
to the selling nf stocks. It is
in
70
200
complicated.
Stock Exchange. Mr. Kallen will
November.
Much
muui
or
highs' of'about
partner in Jay W. Kaufmann &
make his headquarters in Miami
Beach,
last
?
,9
'
.
tn
The Capital
its
1Q99
11^
becQme
slower pace than at any time
since the higher movement started
TT
after
a
a
and
Business?
Ka,]en
tinuing their upward climb—but
erally the
same.
'Jav'W. Kaufmann Partner
Commodity Prices
reports
A
Sb?£
gcnTrT^
lating in stocks.4
and while its earnings have fluer"ated "comnarativ^l? "little"Tts
matea advaneeH from
. comparatively little,
ririrp
in
xo
for
public
a
a
money
lending of money
the purpose of specu¬
Tele¬
uniform dividend of $9 since 1922,
more
Purchasing
Executives
report
that commodity prices are conat
emption
American
3?" to 9?"^ range with 42% dnQ nlgns OI aDoul zuu'
Among
the
secondary
com¬
f"ese *n
60-day range,
panies, the present situation
is
Payment continues high.
There
electricity
or
while
phone and Telegraph has paid
xeiegrapxi nas pain
tuated between lows of about 110
mov-
their leveling. There is indication
0f some tendency to bolster in-
fuel
rp
This month s buying^ policy re
expect it will be less.
Commodity prices
nnlinv
IWrt^toues.;ttedmoy«Mept: toward the somewhat less conserva-
those
to
hnvinoi
Th:c
companies report1955 programs will exlyoo
Will
xneir
their
ceed
big dip in liv-
a
oorrow
lnst0<*s ~~ °r,'n aK"?"
It is unsound for thmn
,
oriSlnal 1955 capital expenditure
L^
Pra&rams and no one reported a
Sutba.ckratioPlans- Also, there is a
in of
2 to 1
to
margin
for
era 1 Reserve becomes increasing y
S2St «£» some
dividends on stocks or interStOCKS
inclined
am
and a fairly rapid advance
to the 100% margin
no borrowing at ail-as the Fed-
mov-
MTa'tRS
or
I
controls
favor strict controls tor margin
¥a*uatl0n °f stocks, especially
a
order position and
tight in the
Yet, despite the
sit
or
balance.
On
their reports on the employment what it considered suitable multinormal-picture in their industries -The pliers of current earnings. In
jump to 32%, who report em- effect, the multip'ier advanced
Increased new orders are re- ployment as better, over Febru- from about 8 for the Dow-Jones
corded by 53% of the committee^ary's 23%, is the sharpest since Industrials in 1948-1950 to 10 in
members and 50% report in-?the Korean War preparedness in- 1953. and to a current 14, which is
creased productions Only 6% showcase ofmid-1950. Again, though, slightly less than the 1936-1940
a
cor-
speculation
nro-
P«^«ftl«h and new order reports
pickup.
sell
or
5% rePort lower production. This< creases in employment are gradual
My studies have led to the conirr to retire anTtake it Tasy
is the most favorable position re- rather than of boom or even elusion that sentiment alone, not thing else
•ftey must be sure a check wui P°fdc si"ce 195°;
boomlet proportions There -a* supported bv any visible change
"Newcomers"
ducers
problem
your
bv the Federal. Reserve in varying margin requirements to correspond somewhat with the state
the
to
currency
longer
fear deep depressions.
}Ye11 uilde/ the current optimistic ./>ouraeed -.and encouraging
i^ay' ThereLare And.icj>~f Purchasing "f Executives are
reflect
respect
present market.)
ProdlKt and nisoosable Incomes—
view
Employment
tiar»s.that
seasonal
that
form of intervention by
Washington in the stock market
*s risky and controversial. You
cannot be sure that what you are
cioing is the right thing and won't
cause more harm than good. (In
any
earnings of most secondary companics fell a great deal in 1953the
cussing them while
lire 1S ra§in8It should be recognized
ha»»r*r of any interverttion, a
certain responsibility is there. It
is actually bping assumed—e.g.,
critical
1955,
or
J? ^egin
however,
the
a
so.
if would be wise to agree 1o such
measures in advance of the necessity for their use—rather than
common
stocks.
Industrial
1954
be
may
it will do
n1SS«1
(3). some
i
halt
common
( Actually,
five
gone
Assuming that measures could be
since
jr0m
yet, but there
as
is
control
found that are useful and feasible,
Dow-Jones
1954
of
danger that
£rave
There has been no change of
importance in the earnings of the
vious
plan
the swing
was
the risks in
1949.
should
cautiously
stock
stocks to the emphasis on the op-
some
carefully and
confidence—from
rise
to
on
the
believe the Committee
consider
too far
portunities in
in
Future
fundamental
for the
aoubt
from
Speculation
determ-
in
variations in
v'<■ w
Ways of Controlling
Undue
more than he
investment and
sentiment
was
(C)
Feasible
Exchange
»
The much-advertised growth of
"uch
the
than it
responds to the public's own
Quandary in deciding whether to
jr x:^chives
? cfc;c
h*ve^created
mav
listed).
world
s e e m s
*Jew
did
worse.
under
marked contrasts of climate.
Stock
improved
-Purchasing
energetic and
develop
people
York
field.
production quotas; braced for a large falling off in
(2) a greater indication of some earnings
when
bu-iness
turned
protective stocks to guard against down after the middle of 1953
.impending labor difficulties, andmildness of the shrink-
the boom let
predicted last
December-by.
enervating in climates that
especially when the
is of long duration.
Statispublished by Yale University
to
(and
material
more
during March
too warm
from
I
Manpur_
chases,
The
Detroit Edison
older
for
absent
willingness
stems
Company,
reports that
beat
to all states,
few
F.
couple; but it may not be wise for
a
young
couple with children,
There
is
something debilitating
are
a
Not since 1950, have so many
reported higher inventories and so
jower
quantities on hand,
Com-
is
Chester
ager
an
Survey
whose
chairman
doubt-
wouid
has been
time.
Association of Purchasing
Agents'
transportation.
desirable
be
at
Gathering Momentum
composite opinion.pj purchas-
tional
i
headnea -
summei
summe
climate
warm
sell
to
This applies
profit.
agents who comprise the Na-
quarters m
New England
and
winter Headquarters in Florida—
even
before man had joined the
i.-irds
wish
ever
reason
pvnpri-
vpnrc'
nf
selected
selected
you
Survey Committee of National Association of Pur¬
chasing Agents report both increase in new orders and in
production, with programs of new capital outlays exceeding '54
county or community has
advantages or disadvan
or
the
if
Business
re¬
Certainly
true.
p^ew'
^he
^
market prices.
and
pleasant
^
this
in early 1946.
,,
T
^
good land and easy to dispose of ]j^e to emphasize
Real-
Business Boomlel
unprofitable
verse
feeling!
_
ing the wide
months
r
may
during
to get the
be
whi¬
ing
Roger W. Babson
This should
In
in
whole, however, the typi¬
second-grade
stock
appears
less over-valued today
|_0 Question I of the Committee's
Questionnaire. However, I should
are
dur¬
the
estate,
,
-
over-speculation
cal
Since
Rise
Department and used as an ex-
munity a .year before buying real
good
Market
September 1953
improving and not
is
a
*>•
are
for
Reasons
sec-
lot; and in
you
periment station.
and
business
closing,
of
On the
(B)
financial advice:
of
pace with that of the leaders,
Bargains are fast disappearing
and there are numerous instances
general, I agree with the
answers
by President Funston of
^
have
In
this.
do
to
good,
looking for acreage,
buy land adjoining some owned
by the United States Agricultural
extra
an
Localities
attractive
you need a
from your job
if
even
word
a
without first
state
that
it,
order
If
churches; with land for a vegetable garden and possible future
be
cold
which
you
stores
regarding different lo-
leave-of-absence
qualifications
Near
of
visiting
there
consider:
idea
cality
but
bad
a
in-
appreciate
would
you
calities,
climate,
and
opportunities. But do not select any lo-
home?
a
Commerce
*
They
States.
buying
The price behavior
located at
formation
ing, Shopping, Typing, and Real
Estate look best to me.
*
—or
capital of the state that you
thinking of moving to. Tell
the
and Pressing, Manufacturers' Representatives, Spray-
to be pen-
7
page
perhaps a little better—of to 1953, but many of these comThen write to the State seeing the market attain substan- panies had poor earnings results
ganda.
Repairing
I get many
best place
to
year
Thursday, March 31, 1955
real-
booklets, and other propa-
them
This
letters
from
.
The Stock Market Situation
which
state to
a
by studying maps,
move
Chamber of
experiment station.
an
as
select
can
estate
Gi?es advice regarding retired persons seeking
occupation, and urges these who are looking for acreage to
buy land adjoining that owned by U. S. Agricultural Depart¬
retired
Advice
Final
You
Babson
Continued
.
feelings and not figures.
By ROGER W. BABSON
Mr.
by
determined
are
.
(1938)
8
(1932)
.
reflect 1!>30 split.
Volume
181
Number 5416
.
.
lines.
very
issue
has
But I
Kentucky Utilities
Offering Underwritten
regret that the
usually
been presented
by Wall Street—of which I am
proud to consider myself a part
in an
incomplete and rather
The
-—
one-sided
income
the
capital
on
imposed
tax
began
problem
in
Thus
impact
is
on
by
The
one.
have
modern
1913.
markets
new
a
the
their
of
speculative
means
gains
since
no
evidence
hardly suggests that the Capital
Gains Tax has by
itself produced
unduly high prices
or
unduly wide
Impressive
argu¬
fluctuations.
ments may
be made against Capi¬
tal Gains Taxes as inequitable in
theory
but
and
unsound
there
in
practice;
impressive
also
are
Utilities
is
Co.
stockhold¬
rights
to subscribe for 190,566 additional
shares of common stock at $24.75
ers
Taxes
been
Kentucky
offering to its
fashion.
(1515)
April
suggestion to make along these
a
Chronicle
The Commercial and Financial
.
a
common
of record March 21, 1955
share
on
the
basis
of
one
new
share for each 12 shares then held.
The
offer,
which expires
3
p.m.
April 11, 1955, is being
underwritten by a syndicate man¬
aged jointly by Blyth & Co., Inc.
(CST)
on
and J. J. B. Hilliard & Son.
The
proceeds from
this
stock
sale
at
and
from
competitive
the sale
a
of
proposed
bidding
(on
in
in first
F, due
April 1, 1985, will be used by the
company to finance a part of the
5)
mortgage
of
cost
of $5,000,000
bonds, series
construction
its
Tennessee, and also sold elec¬
tric
energy
term
at
wholesale,
ities and
which, it is estimated, will cost
about $18,741,000 in 1955 and $18,-
18 rural electric
cooper¬
LOS
L.
Morally,
Jack
1954 amounted to
$36,247,777, and net income to $5,-
John
T.
III
823,560,
is a public utility
engaged in generating, purchas¬
ing, transmitting, distributing and
selling electric energy. At the begininng of this year, the company
Los
This
revenues
Dec. 31,
equal
$2.13
to
compares
with
a
share.
revenues
of
located
in
77
southeastern
971,331,
with Coombs & Co., of
Angeles, Inc., 602 West Sixth
or
$1.76
a
share, reported
California Investors Add
(Special to The Financial Chronicle)
R.
George Hoerlein Opens
areas,
western
and
become
Street.
the year before.
LOS
ANGELES, Calif.—Leo R.
Albright, Henry C. Alvis, Sr., Al¬
SYRACUSE, N. Y. — George
Hoerlein is conducting a securi¬
Ken¬
try have been added to the staff
ties
counties in central,
and
Ralph,
have
$31,749,548, and net income of $4,-
211,000 customers in 499 commu¬
rural
Troll
affiliated
furnished electric service to about
adjacent
Charles H. Huffman,
Julia
ended
The company
and
ANGELES, Calif.—Roland
Barclay,
for the year
Operating
580,000 in 1956.
nities,
^ids To Staff
(Special to The Financial Chronicle)
contracts, to ten municipal¬
atives.
program
Coombs
under
23
of California
business
James
tucky and two adjoining counties
from
offices
Street.
at
600
len V. Bennion and Billie R. Gen¬
Investors, 3924 Wil-
shire Boulevard.
arguments against permitting cap¬
ital gains to
go
untaxed while
imposing
forms
high
of
Tax
I
is
tax
our
not
consider
inequitable
AYC'-V.
MMM
lif®l
imnrove-
to
open
would
basically
to
other
on
Although I be¬
Capital Gains
present
system
ment,
rates
profit.
lieve;,the
it
in- relation
burden
as
whole.
a
Finally, while a lightening of the
tax might well increase the supply
of
stocks
common
holders
to
might at the
further
by persuading
t
take
lar?e
profits,
speculative
buying,
tracted by the new tax
The
net
result
it
time stipnulate
same
of
at¬
advantage.
such
a
move
cannot be foretold.
,f
The objections
Capital
Gains
in
overcome,
policy
a
of
reducing the
Taxes
would
adopted for
were
be
opinion, if such
my
lim¬
a
ited
period of time only and for
specific purpose of dealing
with a
dangerous stock market
the
situation.
For
might well
example,
be
the
tax
from
reduced
the
present 25% maximum to
maximum
least
two
be
to
securities
on
effective
period
believe
would
for
only—say
such
have
specified
a
six
months.
desired
effect
increasing the supply of
stocks
at
time
a
the
standpoint
the
result
larger
in
such
in¬
From
Treasury,
well
that
be
of the
reduced
tax
rate,
because of the inducement to
locked-up
a
would be realized,
revenue
spite
the
of
might
of
common
when
is deemed necessary.
crease
I
arrangement
an
the
at
reduction
such
years,
12V2%
a
owned
shares.
sed
Whatever
its
effect orl the level of stock
prices,
bona fide
not
harmed
even
investors
by
if it
such
ran
for
could
be
concession,
a
limited period.
a
My
proposal
would
require
legislation by Congress, as would
any other change in the Capital
Gains
Tax.
method
President
changes
within
Perhaps
would
be
the
in
the
tov
to
limits,
the
We
Federal
have
powers
In
our
ad¬
upon
For
Congress
narily
meddle
market,
there
times when
are
than twenty
and-Radioactivity Well Logging, which produces an
invaluably record of underground formations penetrated dpr^
is Electric
it
drilling* Through4t««h»6tocy>,LTne-Wellsv has earned a-.'
ing
We
woll-deserved
probably
at present.
in such
time
a
Lane-Wells has been the leader
steel casing of oil and gas wells to "bring in" a new well or to
increase the flow of old wells. Another very important service
deserves attention from Congress.
are
years,
development of essential electronic services for the
rapidly growing oil and gas industries. The Company pio¬
neered the widely used practice of shooting holes through the
may I say that
should not ordi¬
with
the
stock
while
more
the
in
System.
for
such
tariff laws.
conclusion,
ptusj-
rate,
Reserve
precedents
in
service dimension for
the
make
vice from the Board of Governors
of
new
the
effective
specified
in oil joins DRESSER
a
best
give
power
the
another great name
reputation for "Tpmorrpds Tools
—
TodayHT
>-
STRIES, IMC**
John M. Holley Joins
ND
member of
the Dresser group of distinguished companies. The combined
operation is one of the most outstanding organizations serving
the world-wide oil and gas industries. No other single company
provides the same broad range of equipment and services.
*
Effective March 1, Lane-Wells-dieoame the.newest
CHEMICAL EQUIPMENT
E. F. Hutton & Co.
ROSWELL, N. Mex. —John M.
has
become
associated
Holley
with E. F. Hutton & Companv in
charge of their newly opened of¬
fice
419
Avenue.
ner
North
Mr.
at
Holley
Richardson
was
a
part¬
Dresser Industries is
NATIONAL
REPUBLIC
BANK
...
POST OFFICE BOX 713
•
in the First New Mexico Co.
Va.
W.
West¬
BOVAIRD
heimer and Company have opened
Bradford,Pa.
a
branch
Hotel
office
in
the
under
—
the
of
O/eon, N. Y.
DRESSER
Lewis J. Groch.
—
Founded 1891
THE
DREISER INDUSTRIES
—
—
PACIFIC
IDECO
Dallai and Beaumont, Texas
BROS.
LANE-WELLS
—
Founded 1920
COMPANY
Founded 1880
MANUFACTURING
Bradford, Pa.
ARE
SEYFANG
&
CLARK
McLure
direction
DALLAS 21, TEXAS
THESE
Westheimer Branch
WHEELING,
proud to join hands with this great name
acquisition of the Lane-Wells Company adds a
new service dimension to the Dresser Plus
products and
services that are the standard of comparison the world over.
oil. The
in
BUILDING
Lot Angeles,
DIVISION
Founded 1880
Calif.
MAGNET
Founded 1932
—
COVE
RAMSEY, N. J.
Plgce
Company
branch
office
at
—
has
118
Columbui, Ohio
—
Connersville, Ind.
—
Founded 1923
BLOWER
Founded 1854
BARIUM
ENGINEERING
Houston, Texas; Malvern, Arkansas;
r
Grey boll, Wyoming
Founded 1920
William II.
opened
a
Darlington
Avenue.
—
ROOTS-CONNERSVILLE
SECURITY
W. H. Place Branch
DRESSER-IDECO
PUMPS
Huntington Park, Calif.
I
—
Founded 1940
Whittier, Calif.; Dallas, Texas
—
Founded 1931
(1516)
24
The Commercial and Financial Chronicle
Continued
jroin
situation.
6
page
While
the
D&H
..
Thursday, March 31, 1955
.
earned
only $5.54 per share last year and
paid almost all of it out in divi¬
//
"Railroad Kernels
dends, tnere
operations,
service
passenger
which
lor
railroads
some
is
very
of
vide
the
transportation
lowest
cost
and
pro¬
transporta¬
the
capital
bone
during
or
mula, the passenger deficit in 1953
was
$704.5 million.
We will not
done
future
have
to
the
1954
time, but I
figures
for
some
glad to note from
was
the annual report of the Pennsyl¬
Railroad
vania
deficit in
lion
that
1954
than
less
in
its
passenger
1953.
If
we
use
the ICC formula and
nore
ig¬
the
rule of thumb
method, the actual
out-of-pocket
loss
services is
about
which
formula,
in
While every
lem
of the
is still
and represents a
ure
h: r:'1 work. I
am
ion
big fig¬
a
big problem.
greatest
the
ICC
phnse of 1 his nrobstudy, thought and
deserves
that
passenger
50%
still of the opin¬
progress
in
reducing or eliminating the pas¬
deficit will result from the
senger
reduction
of
competition between
which
would
involve
railroads,
permission for the railroads to get
together and work out reasonable
service schedules designed to serve
communities adequately but with¬
the element of competition
out
between railroads.
legislation,
There
are
the
be
who
to
think
themselves to formu¬
plan that could beTnade ef¬
a
The need for
regulatory
of
broad
its
railroads
tive
legislation
would
sense
start made
a
in
freedom
more
by:
making
rate
provisions of the Inter¬
state Commerce
(2)
Act must remain.
Giving
right of
Commerce
Commission
decisions
verse
sions
with
train
railroads the
the Interstate
the
appeal to
the
on
missions
passenger
and
part of State Com¬
with
(3) Narrowing the limits under
which
the
transportation of agri¬
commodities
cultural
would
motor carrier
from
exempt
modernization
have
Repealing
(4)
(5)
for
eight
or
but nothing has been
complished.
It is heartening
the
state
Commerce
Chairman
quently
and
specific
It
in
to
Inter¬
vigorously
long-and-
the
Giving
the
railroads
transportation under
If
could
we
lew
accomplish
just
then
and
State
the
facilities
Governments
of
payment
provided
monies,
the
White House
have
we
with
case
doubted
that
be
railroads, if enacted
put
into law.
to
we
heartened
have less
reason
because
now
is already evidpnt that great
flicts
are
occurring within
Cabinet
P«e'f
the
and
to, understand.
easy
it
con¬
the
reason
Those
is
who
benefited bv keeping the rail¬
are
roads in
only
artificial
to
those
and
that
advantages—
naturally
come
not man-made.
are
would
you
expect
me
to say something about railroad
consolidations. Well, I am in l'avor
of railroad consolidations and al¬
been because I think it
large
systems. I 'think this would be not
only in the interest of the public
but
also
of
railroad
security
holders.
railroads like
facturing
etc.
we
we
need
we
big manu¬
big
banks,
concerns,
Small
railroads
to
big
at
are
a
dis¬
they
are
in research
than
revenues
we
are
accustomed to for
any
Administration
to
face
what
the
is
suppose
and
any Congress
and do merely
facts
lust
it
ad¬
is
and
too
reasonable.
much
to
I
expect
even
scale
is
necessary.
handicapped in attract¬
industries
on
their lines.
required to do most of
to
absorb
though
roads
that
would
the
And
weaker
some
have
cost.
to
be
rail¬
included
with the
stronger in effecting con¬
there
is
a
bigger
spreading of the risk. We see now
solidations,
and omnibus revision of the In¬
terstate Commerce Act such as we
the
had
in
1920
and
again in 1940.
Those omnibus revisions occurred
with respect to railroad consolida¬
Interstate
mission
is
Commerce
doing
little
a
when the country was scared about
the railroad
situation, and with
tions, and that is all
good
voluntarily, just
cause.
another
K->d
Perhaps it will
to
scare
bring about
omnibus revision and
an
want
any
Rails
such
take
don't
we
omnibus
opinion,
are
a
is
few
not,
Lowest
Cost
revision,
necessary.
things
done that would
the
past and
that
help
in
my
There
could
be
lot and if
a
railroads
are
the
back¬
I
as
am
to
Com¬
urging
the
good.
must
business
cli¬
earnings this
year,
indicated the ability
dictated
the
advisability a
of
ago
paying
and
few
extra
an
dividend of $1.50 per share on top
of the regular dividend of $1.00
that
quarter
per
has
been
now
years.
effecting debt reduction, im¬
proving the physical condition of
the
property
and
making the
rather large capital expenditures
necessary for complete Dieselization,
etc.,
stockholders'
money
used, and the payment of
dividend
an
which required
—
no apology of
course, especially to
the stockholders—was merely do¬
ing
justice
to
that
will
the
stockholders,
always
be
our
policy.
A
two
commitment
a
formally
to
the
Coal
Com¬
It lost about $2,900,000 for
consecutive
situation
has
but
years,
been
its
improving.
underwrite
will
have
cient
by
to
retire
the
sure
will
in
con¬
will
probably expect me to
something about the Dela¬
and
Hudson
Company and
its
subsidiaries, with which I am
happy to be associated. Our rail¬
lower
1954 des¬
realization
tirement
5%
is
the
of
preferred
callable
entire
105
at
dividends.
there
Now
plus
that
to
be
actually be
this
conversion
until
days
will
roads
in
are
and
condition.
excellent
in
same
two months of 1954.
The
management
the
of
Coal
operations must be geared to
a
have
we
ket, and while
falling
a
of what
might be
As
will
show
result
a
coal
improve¬
good
the last two.
over
Our
coal
company
rail
labors under the difficulties of all
anthracite companies—a
declining
market
and
a
deteriorating price
yards,
reduced.
If
first
two
$310,000
last
of
a
this
loss of
Earnings
for
the first two months amounted to
$1.70
share.
per
So,
unless
serious situation confronts
cannot
now
ought to be
a
some
foresee, this
better
one
that
us
year
and
Join D. D. Weston Staff
(Special to The Financial Chronicle)
HILLS, Cal.—Spen¬
Brandeis, Donald R. Bretting,
Sylvia B. Jerson, Abe L. Kuleske,
William T. Maxwell, and Robert
R. Pence have joined the staff of
cer
E. Bermant
West
City,
to
business.
44th
Co.
ects to reduce
curvature.
close to par,
feature
prior
comprehensive
improvement program
time
urally
increased operating effi¬
substantially. Also, it has
materially bettered the company's
that
competitive position with
that privilege expires. Even if the
common stock does not reach the
to
the
lucrative
traffic.
This
conversion
only
it is
respect
transcontinental
does
not
mark
tion
of
their
preferred
stock
converted,
such
stock.
common
earnings
to
$9.08
entire
should
present
would
have
be
On
year's
worked
out
a
share compared with
$10.96 actually reported. This di¬
pensated
be
more
than
com¬
for by the further sim¬
plification and strengthenening of
the capital structure.
As it is, Rock
Island has
par¬
a
road's
segments of the service
>
stock would be
last
the
in
status
from the industrialization of large
1,408,738
2,055,638 shares.
capitalization,
a
the
issue
the
to
If
change
period of bankruptcy. In
addition, the company has bene¬
fited in a majojr way trafficwise
avoid the establishment of large
capital gains through the redemp¬
ticularly strong capital structure.
The company's bankruptcy reor¬
indicated
that
area.
this
growth trend is continuing. While
earnings last year were off fairly
sharply from the 1953 level the
showing of $10.96
was
This
ypar
common
share
satisfactory
highly
a
one.
a
has started out well and
further sizable year-to-year gains
are
looked
for
in
the
coming
months.
Moreover, the savings to
be realized from refunding of the
preferred,o if
verted, will
$1 a common
lyst
of
none
come
snare
consider
dividends
It's the Best
"There is
a
desire in many
private enterprise
field
on
it
con¬
than
annually. Ana¬
that
will
is
more
to
liberal
more
then
in
be
order.
Way
countries to leave to
competitive lines
as
large
a
as
possible. The private sector accounts for the
bulk of
capital formation in Japan, the Philippines
Malaya, but
even
public enterprise.
"In
India,
in other countries such
directly
scope
in
"
.
where
a
the
number
of
as
.
government
industrial
is
investing
fields,
much
is still left for private enterprise. In China
(Formosa) the government has adopted a policy of
selling public enterprises to private interests.
"Ideology apart, most of the countries in the
region have in practice adopted
a
system of mixed
in which the public sector includes basic
facilities—technical
training, housing, public
own¬
ership and development of forest and mineral
re¬
and
transportation and other public utilities
—while the
remaining industrial sectors, especially
sources
goods industries,
are
left to private enter¬
prise.'—United Nations.
at
our
think
it
own
is
—
experience is
these
a
safe guide—and
peoples will in the long
prosper
•
prise—and leave it unfettered.
in proportion
as
It is
industrial
i
formed
offices
the
since the
parity in this interval,
likely that quite a number of
Street, New York
in a securities
engage
property
has nat¬
ciency
become
may
the
to
mileage, grades and
The
it is considered quite
the preferred stock
that
possible
conversion
If
has
with
' large
signals
traffic
control,
major relocation proj¬
Considering the recent strength
the common, which has been
moving
into
new
high ground
consumer
J. Bermant Co. Formed
Bermant &
a
centralized
many
of the bonds will be issued.
Co., 140 South
Beverly Drive.
Joseph
retarder
of
amount of automatic block
of
economy
BEVERLY
Daniel D. Weston &
installation
our
regular dividend easily provided.1
on
complete
enterprise has been definitely faster than that of
months
year.
large
Company
of $918,000 against
year
19
is
for
two
Ceylon, Korea and Pakistan the growth of private
expenses, the Delaware and Hud¬
son
had consolidated net income
the
$207,-
spent
re¬
and
revenues
duced railroad and Coal
J.
stock
and
and
increased
of
sales
the
spent
dieselization,
mar¬
expected for the entire year, I am
quite certain that this year as a
whole
been
de¬
do not expect
we
be indicative
financial
if
and
clining market. There is a serious
price
situation
existing
in
the
industry at the same
time that
than
has
was
extent,
all
lution would
Company has come to grips with
the necessity of curtailing their
producing units and cutting the
cloth to fit the patient, which is
just another way of saying that
physical
good
and
of the preferred is converted none
be
more
This would be
less
new
converted the amount of bonds to
issued
only slightly
$162 million.
money
preferred
shares of
and
than
considerably
726,709 that
is¬
re¬
that
be
is¬
not
To the
the
$65
is
does
basis,
demption date.
any,
entire
debentures
equipment and on capital
improvements to the property
during the past 10 years.
Tnis
feature
ten
the
and
income
before
share-for-share
a
the first mortgage 2%s.
of the preferred stock
will amount to
convertible
on
debt
sued the total debt of the company
will
to
result,
a
funded
none
converted
million
the bonds. The preferred stock
into common stock
sue
increased
ment
is
the
it
total
of the end of last year amounted
tions and
considerable
necessary
As
program.
company's
Even if
made
whether
to
as
of
un¬
only about $97 million, which
almost
equally divided be¬
tween
serial
equipment obliga¬
accrued
been
management
was
which
all
have
seems
question
ever
issue,
the
further aggressive debt
a
to
amount
company's entire
stock
arrangements
quarter last year than in the
quarter the previous year. In the
first two months of this year, the
.
condition
as
The purpose of the
to provide funds for re¬
is
$2.02 per ton lower in the fourth
we
suffi¬
it advisable to convert in order to
a
of, $1.02
ton of coal sold. Colliery costs
ton of coal produced were
per
for
the
fund
sinking
a
bond^
maturity.
issue
is
Tne
holders of the preferred will find
a
per
summation
retirement
debentures.
a particularly se¬
following its con¬
was
and
one,
cago, Rock Island & Pacific 4 M»%
loss of $730,-
was
in the fourth quarter of
pite
vere
an
the fourth quarter of 1953,
loss was reduced to $145,000
in
this
ganization
made
dertook
valuable
about
word
pany.
bankers
issue of up to $65 million of Chi¬
expire
In
come
they have
tinue in the future.
ware
the country believes what it
says,
that
the
consolidations
say
Provide
Transportation
Rut
But
You
scares.
ex¬
future, and
near
better
mate and outlook for
on
the things that large railroads are
required to do without the larger
pres¬
artificial
capital
to
and
way,
It is quite clear to me that it
will take greater political
courage
political
their
penditures in the
the somewhat
months
large group of in¬
a
the results of the last two months
big country;
vantages.
great
retain
for
need
need
a
big
a
engage
to
lesser
do things
in
large
They are
ing large
They are
exerting
These facts, together
working capital position
the
This is
the
sure
equipment.
and
vestment
anthracite
loss
are
and
property
Bigness in itself is not
necessarily a desirable end, nor is
bigness an evil to be shunned.
Individually
advantages
the
Company's loss was $17,000
against a $560,000 loss in the first
Railroad Consolidations
Perhaps
not able
artificial
of
Coal
advantage.
a
their
progress
accelerate, but not at the
expense of other legitimate enter¬
prise, because no competitors are
s*raitjacket of mononolistic regulation and who fear the
of
them¬
is in tne public interest that there
be fewer railroads and more
our
condition
with
Chicago, Rock Island & Pacific
Last week
income
the
to
probably many of you know,
a
good jou was done in reducing
cent and improving the physical
Whereas there
We
nrettv
are
fhe
to
find
now
tne
programs
detriment
any
000
would
entitled
maintenance
would
the unequal situation
they
of
make it possible to
public
railroads
ways have
ob'ccbve report would be ben¬
an
eficial
of
the
equity of
never
use
to
business
the
which
user
a
1, 1954.
Dec.
on
in the r-Proad
about
Cabinet
report
a
in
expenditures
As
have
things
and
fully Dieselized
great and the heavy
years
curtail
and
fre¬
Transportation,
on
rendered
the
proper regu¬
charge for the commercial
regard.
a
15
without
was
clause.
latory procedure.
urging
this
appointed
Committee
which
and
the
ac¬
heartening, too, when the
was
President
nre
of
Commission
remedies
a
regulatory
seven
years,
hear
regu¬
right to engage in highway and air
these
not
are
maintenance
last
extra
require
the
been
need
the
of
for the last
process
be
lation.
short-haul
position.
an adequate car supply.
requirements in the ncdr
paid for 10 consecutive
nity.
this
such
to
respect
abandonments.
emerge from
about
in¬
from
selves and their forward
screaming
ad¬
Commis¬
to
respect
abandonments
action
from
State
of
with other forms of transporta ion
on a basis of more equal opportu¬
railroads
rates
reducing the time lag in re¬
vising rates. But I think in this
regard that in order to prevent
cut-throat competition the mini¬
mum
working
asset
are
property.
little
a
and
in
that
give
opportunity to compete
The
coun¬
his opinion, but so
concerned, I would
to
am
see
Federal
in this fiercely comoeti-
era an
the
Giving the railroads
the
involving
process
enactment
modernized
a
I
as
(1)
fective with Commission approval.
(3)
entitled
like to
1hat
resides
permit the railroads to
agree among
benefit of
enacted.
already
power
is
far
Interstate Commerce Com¬
mission
late
If this requires
should
some
sufficient
in
it
as
the
try as a whole and without regarcl
special interests.
Every man
$12 mil¬
some
was
for
our
have
and
Capital
According to the ICC for¬
deterioration
in
quick
The railroads
tion, then these things should be
serious.
no
was
year
we
run
they cling to private enter¬
Volume 181
Number 5416
.
.
.
The Commercial and Financial Chronicle
that's the
...
record-breaking length of this
Deep beneath the waters of the Gulf lies
our
nation's most
promising
sources
one
of
of crude
petroleum. A Socony-Vacuum affiliate, Magnolia
Petroleum
Company, and its associates
oping several oil and
area
—
coast.
one
as
Barges
far
now
as
gas
To
an
assure a
undersea
are
devel¬
fields in this off-shore
28 miles from the Louisiana
daily, but operations
are
constant flow of oil and natural gas,
pipeline is
now
under construction to
new
pipeline under the Gulf of Mexico
will extend
a
total length of 48 miles
waters of the Gulf. It will
beneath the
permit nearly doubling
Socony-Vacuurn's present oil production there and
will
eventually be capable of delivering
up
to 50,000
barrels of oil daily to the Louisiana mainland.
This submarine gathering system, the longest
undersea
of
by bad weather.
(1517)
gather this production. When completed, this line
bring the oil ashore at the rate
of about 6,000 barrels
often curtailed
,
pipeline in the world, is another example
Socony-Vacuum's continuing
efforts
to
keep America supplied with the increasing
tities of
help
quan¬
SOCONY-VACUUM
petroleum it must have.
SOCONY-VACUUM
OIL
COMPANY, INC.
and Affiliates: MAGNOLIA PETROLEUM CO., GENERAL PETROLEUM CORP.
26
The Commercial and Financial Chronicle
(1518)
important question of whether
Executive
plan is
Compensation
the
so
most
the
Holds
opens
fits.
Code is deficient in
new
door to abuse in fields of stock options and fringe bene¬
Predicts staggering unanticipated tax leakage and huge
loss in
the
old
five
She explained that
able
was
make
to
of
tax
.
.
of
Bill,
top
It is the most
.
piece
to
monu¬
legislation
ever
be something of
Some of us may
may
exaggeration.
an
think that legislation
such
as,
for
example,
our
anti-trust laws—the
Sherman
Act, the Clayton Act, the
Robinson-Patman
com¬
least
equally
Act
at
are
—
But Mr.
completely
important.
panies over
Reed's
the
understandable.
past
e.ral
sev-
years
Here
when asked to
Henry Rothschild
compensation
practices. With
document)
these
taxes,
that
fact
the
look
when
even
a
tax
$100
of salary was in effect being paid
by the government, the other $20
in
was
company
80%
an
bracket and $80 out of every
out of the company's coffers.
came
by spend¬
You don't make money
ing unnecessary dollars, no matter
how
those
of
many
dollars
are
tax-deductible.
is
This
pretty obvious, but it's
how we tend to lose
sight of the obvious in the field
of executive compensation.
The
surprising
combined
with inflation, have ravaged sal¬
aries above a certain bracket, and
we've
had
to
invent ways and
means
of restoring to executive
that
is
reason
accompanying
ment and
companies
say, it is the government that is
paying the salaries. They over¬
high
our
taxes,
bill
a
length
of
(and
875
some
double
not
triple-spaced'either), with
or
executive
was
in
pages
explain their
is
statement
Ways and
been
report
with
(a
this
on
an
Treasury
since
1951.
Particularly as reported to and
passed by the House, this was a
tremendously impressive and
write
am¬
document—seeking to re¬
the
law
While
to
as
so
Non-qualified
remove
uncertainties, resolve conflicts in
case
law and interpretation, sub¬
stitute
objective statutory rules
address that I delivered in
1953, I grouped all such
plans in three general categories
insofar as tax impact is concerned,
July,
namely:
that
Plans
One:
defer
the .re¬
ceipt of compensation and spread
the
compensation
gard
Revenue
private
rulings,
few
he
but
for
in the field of executive compen¬
sation. The new Code makes im¬
changes
portant
there,
the law
and
the last analysis
patchwork of changes rather
but
is
here
in
a
than
fundamental revision. Par¬
a
years
fused
wide
to
time,
and
to
level
to
bear
as
so
bring
out income
lower
tax
brackets—so-called deferred
com¬
pensation.
received
tal
that
benefits
tax
by the executive at capi¬
gain rather than ordinary in¬
tax
come
rates—principally, stock
Three:
the
Plans
that
which
not
are
executive
difficult,
a
at
but
all
result
in
taxable
to
—
not
obvio'isy;
impossible,
to say
does
the
new
Code
have
about plans in each of these
categories?
going" to be rather critical
Code, so I want to say a
few
nice
things about it first.
H. R. 8300, which became the In¬
I
of
am
the
ternal Revenue Code of
1954,
was
reported to the House-*of Repre¬
sentatives on .March 9.
1954, on
behalf
Means
man
of
does
or
in
was
in
the
1953,
of
the
Let's
Compensation
take
deferred
first
the
field
of
compensation. For tax
there are two general
deferred compensation
purposes
of
plan—on the
hand, qualified
deferred profit-
one
.pension,
sharing
and
retirement
covering a relatively large
group
plans
group
employees, and, on the other
hand, non-qualified plans usually
confined
to
tive
group of
or
the
House
Committee
Daniel
,A.
by
Reed,
Ways
and
Congress¬
its
Chair¬
*An address by Mr. Rothschild before
the National Industrial Conference
Board.
,New York City._
a
an
Qualified
may
individual
Plans:
top executives.
The
entitled
be
execu¬
qualified
t.p specific
tional
institutions
made
applicable
the
stock
when
employee;
employing
are
made
income
to
a
distributed
to
as payments
plan: tax-free
company
into
a
the
trust
established
connection;with the plan. To
cure
these
the
tax deduction to the
substantial
plan must,
as
criminate
in
you
in
sei-
benefits,
a
it
interesting to
still
fied
by
the
on
the
House.
Estate
estate
and
as
tax.
were,
other hand, representatives of the
Treasury
worked
The
Department
these
on
forum
who
had
brought
ed
many
flaws in the House bill. Following
the forum and hearings thereafter
held by the
Finance,
Senate Committee
the
Senate
those
highly
and
relating
those
to
qualified
relating to
plans
non-quali¬
non¬
Code
1954
plans relates to ap¬
ployee under
qualified plan has
a
been
subject to the capital gains,
rather than ordinary income tax,
but
this
lump
has
been
not
payment
sum
Code
also
to
makes
of
true
to
The
lump
a
benefi;
a
new
sum
pay¬
beneficiary subject to
gains tax.1' This tax
treatment is not applicable to pay¬
a
capital
ments under
(4)
non-qualified plans./
Retirement Income
Last
is
least
and
income
credit,
the
Credit:
retirement
under, which
the
tax (in the first tax. bracket) of
$1,200 of so-called retirement in
constitutes
come
tax.
a
credit,
Since the first tax bracket is
now
20%, the maximum credit is $240
but
if
the
first
be
income
ment
tax
bracket
increased,
credit
the
will
rah
retire¬
also
gc
Deferred compensation undei
up.
non-qualified plan would prob
ably not be considered retirement
income
The
point of least
from
the
of
so
tax
ample, take the
case
tive
receive
entitled
to
retirement for
year on
of
10
if
he, should
with
years,
been
paid
widow
die
the
of
ex¬
execu¬
$10,000 a
minimum
he
has
his
the
The
income tax
estate
may
still
payments
at
estate
the
to
a result of which h
$1,200 of income wit
II
estate
Stock Plans
We
ing
gains
on
the
owed
to
Code,
there
plan,
ments
are
immunity for pay¬
qualified retire¬
a
provided
made
contributions
by
or
of
such
pay¬
attributable
the
employer
rather than of the employee and
field
Congress, in
of
i
benefits
stock
substance
periods
be
that
No
under
similar
cally
on
under
a
is
survivor
qualified
immunity
conferred
annuities
a
and
is
plan.
specifi¬
payments
or
non-qualified
plan.
The
estate
a
tax
review
rules
pertaining to
immunity thus call for
of
all
existing plans.
(2) Death Benefits:
change
relates to
The
death
second
benefits.
if
certain
met,
holdin
no
othe;
tax woulr
either '<the
on
exercise
gran
of
an.employe*
option. If the option price was af
least 95% of the market price a
time
the
profit
subject
option
but
on
price
option
at
than
the
of
85%,
only
up
market
were
option
tive
result
was
was
granted
ambiguities ir
1950.
For
ex
not clear what thi}
would
should
b
ta:
the spreac
option prio
to
the Revenue Act of
ample, it
95^
profi:
income
and
some
a
would
Stock
ordinary
but
between
tax
b(|
would
less' than
was
less
not
There
of
capital gains rates; if th<
sale
taxed
granted
the stouj
was
sale
the
to
taxed at
option
on
unexercised
new
Revenu
observed; »and
were
imposed
the
the
by
That Act provided i:
were
conditions
con¬
certain type;
on
option
Act of 1950.
first '
were
by statute
at the time the
immunity
joint
o
opinion, did fa
my
too much.
estate.
similar
i.
op
compen
Congress did little
rates
on
capita*
and,
stock
nothing, in the stock option fielo
are
made to a designated bene¬
ficiary other than the executive's
A
to
plans
restricted
sation
any
under
ment
tax—stock
If in the deferred
the
confers
plans involvf
subject
tions.
The Code
now
to
now
particular,
possibility of an
liability under quali¬
tax
come
benefits
Tax
least the
fied plans.
ments
1954
or;
dividend,
or
out his deferred compensation.
or
tax
the
as
will have
ferred
the commuted value
in
of
pension
a
interest
or
rents,
or
will
but the ex¬
also be sub¬
both Federal
tax,
c
apart
that the executive wir
in the form of
annuity
balance
widow
widow.
the
to
a
before
receive
estate
state,,
an
a
provision that
a
instalments,
to
For
total of $100,000,
a
will
unpaid
and
of
amount
is
ques¬
involve
money.
thii
that this
consequence,
small
credit, is
of
purposes
reason
executive
of
often
more
the
for
credit.
usually have other retirement in,
first
businessesmen
estate
and
great deal
—
employees.
the
by
plication of the capital gains tax.
A lump sum payment to an em¬
be at least equally
can
important
on
eliminated
The
field
overlook
to
tions which
annuities
out
qualified and non-quali¬
compensation that they have tend¬
conferred
sections.
of
The determination of the
the
in
lems
on
substantially all the major provi¬
officers, sions in
the.House bill relating to
stockholders, supervisory or highly
deferred
compensation
both
compensated
Tax:
Many
persons
part in this forum
took
passed
who
of
much
concerned with income tax prob¬
an
bill
and
attorneys have been
was
The
be¬
gap
these^ changes has to do with the
Prior
tax
A third dis¬
made
come
(1)
ject
May, 1954, the Practic¬
ing Law Institute held a two-day
to
qualified plans.
•
ecutive's
Forum: In
the
plans
group
an
Institute
changes,
note, tend
further
on
ac¬
na¬
tween the tax treatment of quali¬
know, not dis¬
favor
is
the
under
changes and
These
specific mention.
further
forum
Capital Gains:
a
subject to
Law
(3)
tinction
between
should
relatively minor
a
be
an
under
j
these
from
have been allowed when payments
were
made.
The
bill
would
have postponed taxes
employee in the case of
annuity purchased for him by
employer until the employee
trusts
to
been
ture, the new Code contains four
amendments to the law deserving
tax
benefits: no tax on the em¬ the one
hand, those with first¬
ployee until he receives benefits; hand experience with problems
a
capital gains tax if payment is presented by the various sections
made in a lump sum; no tax at all* covered bv the
bill, and, on the
appreciation in the employer's
Apart
changes of
also
have
qualified plans.
on
its tax deduction would
Practicing
ap¬
last
instalments.
The
heretofore
the
tax
on
income
plicable to foundations and educa¬
payments
petitive activity!
or rea¬
business
deferred compen-
tually received
the annuity.
security
sonable
in
company,
pro¬
In¬
three
Deferred
so-called
to
few
responsibility shocking.
it
as
a
tinuing to require consulting and
advisory services and non-com¬
the
a
part of the Treasury officials
Bad
his
ments
re¬
Provi¬
bill.
House
relating
widen
situation
the
the
do for
not
in
by
made
income
employee
an
right thereto
life, but this is true
lump-sum benefit paid
under a qualified retirement plan.
Under a non-qualified plan, the
employee's rights must be for¬
feitable—another reason for con¬
during
undertaking
ambitious
without adequate
any
from
not
or
non-forfeitable
minor compared
are
interest, have been made
applicable to funds established in
connection with qualified plans.
Provisions relating
to unrelated
that the company may lose its tax
categories of deductioiV
entirely. The House bill
compensation
plan
mentioned would
have
removed
this
un¬
abo.ye — deferred compensation,
certainty by providing specifically
stock plans and plans involving
np. for a tax on the employee only
tax.
p; in the years when he is
actually
I
receiving payments. As for the
each
plan
objective.
What
does
of
plans, and
benefits
Code
types
Plans
Two:
the
the
sions
publicity, I referred to this
assume
Code
em¬
exemption
ciary of the employee.
changes actually
new
flected
the
situation and called the failure
the
great deal to be done
a
the
$5,000 of death
exempt
fied deferred
tax
The
has
issue
to
was room
the
but
reasonable
was
Changes Effected by the New Code
un¬
of
issued
non¬
on
legislation by the new Con¬
gress.
One of the first and most
important subjects on which we
must have legislation is deferred
compensation.
deferred
Commissioner
the
1940s,
ternal
provisions
Undoubtedly there
There is
to
is
only of
improvement,
the
benefits
a
House
of
no
vides that the first
had
dictable than-before.
re¬
confused state. In
and
to
as
secure
was
by
solely
able right to the exemption durii
his life. The 1954 Code now pro¬
whether
to
death
there
hibited transactions, such as loans
compensation
arrangements,
law has long been in a highly
certain
so
ployee;
death bene¬
a
payable
the'
of
reason
tax
need
basic
and
sound. By first adopting and then
abandoning this approach, Con¬
gress has left the field even more
uncertain, ambiguous and unpre¬
House
With
non-qualified
to
revised
be
rul¬
approach
steadfastly re¬
rulings at all,
and the Treasury has failed to is¬
for administration discretion.
sue any regulations or to take any
Regrettably, as finally enacted official
position upon this type of
many of these laudable objectives
arrangement. A year and a half
failed of accomplishment, notably
ago, in a statement which received
period of
over a
for
plans.
plans:
been
the
pension
tions.
bill would have done for qualified
deferred compensation
were
had
non-discrimination for the
or
profit-sharing
on
The
in the company's dis¬
cretion,
without
reference
to
salary or other earnings.
the
specific
qualified arrangements left some
ambiguities and unanswered ques¬
employees
what
have
usual
allowed
„
an
ings
25% of the company's annual con¬
tribution to be
allocated among
for
administra¬
plan.
as discriminatory. So as
permit
individual
incentive
awards,
the
House
bill
would
ticularly in the field ofhjexecutive
gatiori fieicLik even worse today.
compensation some semblance of compensation the new Code, like
The uncertainty in the law has
the purchasing power it once had. its
predecessors* is primarily a
led to the fear that an employee
We've had to dream up new plans
recodification, a general reshuf¬
may be taxed under a non-quali¬
of permitting a capable executive fling and renumbering of
sections,
fied
deferred
compensation ar¬
to get some kind of decent secu¬
with amendments tacked on here
rity for himself and his family— and there. Many changes of sub¬ rangement when the arrangement
is made, even though he may not
new
plans under which he may stance,
yes;
but
comprehensive
receive payment for many years—
be able, if all goes well and he revision
in this uncertain field,
and perhaps not at all. If the em¬
does well, to build some kind of no.
ployee is properly protected
estate.
Now let's take a look at what
against such a tax, the fear arises
In
could
eliminate
of
as
to objection, I think the bill
open
to
much
qualify
discretion.
qualified
So
To
provisions in the House bill
partici¬
have
tax.
tive
on
limitations
income
pro¬
pants of the plan in proportion to
salary or the plan may be dis¬
within
Federal
con¬
more
among
an
employee to his estate or benefi¬
ciary was rendered exempt from
if the employee had a non-forfeit
cretionary
allocation
of
profitsharing awards. Under existing
law, a company's contribution to
a
qualified
profit-sharing
plan
allocated
dea
for
Amoftg other- important changes,
be
of
death of
substituted
generally satisfactory
is.
company's employees (but not
10) would not have been
must
$5,000
the
on
been
ex¬
the House bill permitted some dis¬
legislation
the
bitious
or
the
first
paid
to
discriminatory in favor
key employees.
of
splendid
of 577 pages of com¬
explanation. The House
Means Committee had
working
25%
plans,
believe
who
the
fit
considered
entire
the
from
system
Well, that
thinking
some
overhauls
the
attempted by the Congress."
story pretty
well reflects
the
Federal
so
that
Well,
'"the Bill
mental
apples.
many
reporting out
Mr. Reed said:
bottom.
a
profit because
she sold
the
included
qualified
to
some
1951
benefits
Personally,
I
favor
the
House
approach
under
which
statutory yardsticks would have
it
less than
In
man.
cents
them for four.
she
story of
who bought apples
apiece
and sold
lady
10%
which
indefinitely postpone tax relief.
all remember the
for
were
will upset President Eisenhower's Budget esti¬
revenue
mates, and
You
key
are
unfortunate.
was
In
exemption,
discriminatory
if
more
10%
of participants were
employees.
Key
employees
defined as the highest-paid
(but not over 100). A plan
than
of deferred remuneration,
area
the
Thursday, March 31, 1955
.
for this
sidered
and
regard
there
what
to
as
bill specifically
vided that a plan would be
this
law to be
concrete
the
think
With
re¬
constitutes discrimination. For
ample,
magnificent technical achievement, it is "a thing
patches" regarding executive compensation.
a
yardsticks
statutory
Mr. Rothschild maintains while 1954 Internal Revenue Code
shreds
in
change in this
determination
trative
Attorney-at-Law, New York City
of
I
past. The House bill attempted
fundamental
a
left
arrangements—and
law pretty much as it was before.
gard by substituting for adminis¬
By V. HENRY ROTHSCHILD*
represents
determination
administrative
Undei the 1954 Revenue Code
fied
a
discriminatory has, for
part, been a matter of
*
.
die
and
be
if
with
if
beneficiary
should
exercise the
option.
an
his
his
then
execuj
optior
estate
seek
o
'
The effect
corporate reorganizations, ar*
changes .in the, stock subject t<
option.,was likewise not JnL.aH
re
volume
Number 5416
181
the
time
Tax
Code
at
changes and
some
granted.
these
The
spects clear.
The Commercial and Financial Chronicle
...
new
when
the
option
is
(1519)
Thus, if
exercises
may
stock is selling at $100
option is granted, under
prior law the option price would
respects, although it should be
pointed out in passing that as a
to
have
only
rule it will still be to the tax ad¬
years
vantage of the executive to
exer¬
the
market
during his lifetime
the
time
makes
desired
clarifications
the
in
cise his option
in
law
ather than have his estate
eneficiaries
When
was
do
the
of
vigorously
an
option
give an executive the right
buy so many shares of his
company's stock
at
a
the next
10
him
price equal to 85%
of
had
the
at
1954,
over
value
he
of
the
exercises
stock
the
option.
a
when the
to
to
be
at
obtain tax
least
$85
benefits. Under
it
to
seems
the
pay
$50
the
and
the option
that
the
executive
at that time,
executive
$42.50. This
seems
need
to
be
result,
may
granted and if the stock
be
variable price option
although it is by no
means clear, and
regulations have
not yet been issued.
goes
provision?
new
report
states
options
a
Revenue
Code
of
porations to
of
their
The
that
Committee
variable
"widely used by
are
What is the explanation for this
Internal
his
or
for
down
encourage
stock
options
attacked.
SOUTHERN NATURAL GAS COMPANY REPORTS FOR
was
Gris-
Dean
Continued,
was
on
that it
gested
a
was
1954
to
hand-out
a
special group of taxpayers with¬
In
"decent
justification." There
flurry of law-suits by mi¬
nority stockholders — a couple of
was
a
25
much has been
years
them successful.
added.
The operation of stock option
plans since the 1950 Act has been
the
subject
Perrin
of
Stryker,
cently
with
published
results re¬
"Fortune"
in
.
.
.
in The INDUSTRIAL SOUTHEAST
under
study
a
to the
Magazine. Thirty plans were con¬
sidered and, as of mid-October,
1954, 263 officers under 21 of these
plans had paper profits aggregat¬
ing $21,000,000, or an average of
$83,000 per man. Perrin Stryker is
adept at presenting both sides of
case
of
industry in Mississippi,
Alabama, Georgia, and South Carolina
and to the capacity of
.
.
.
Southern Natural Gas,
serving the industry of these states.
without revealing his own
views.
resources
However, reading between
I have the impression
a
his
lines,
that he thinks it
whether
stock
im¬
to
earnings." He
ap¬
to agr^e with the Griswold
.
view
that
ment
of
the
the
preferential
stock
treat¬
is
option
not
to justify. '
easy
I don't agree.
the
"increase
incentive
prove company
pears
question
opjen to
options
executive's
an
Revenue
In the first place,
Act
did
not
confer preferential treatment,
but
the
restored
of
what
been
many
in
prior
to
by
Moreover,
was
be
not
of
terms
no
exist/There
res¬
com¬
means
options
stock
thought of simply
supplying
would
which
a
States Su¬
Court in 1945—and the
should
tive
substance
thought it had
years
of the United
toration
plete.
1950
law to the
everyone
for
decision
preme
of
not
incen¬
an
otherwise
at least four other
are
justifications for the stock option:
First:
tively
stock
The
granted,
differentials
in
tends to restore
compensation be¬
levels
tween
which
past decade
of
management
eliminated
were
selec¬
option,
and
a
the
over
half by taxes,
inflation and two periods of salary
stabilization.
Second: The stock option may
supply
essential holding
power
against competition for executive
talent
which
a
company
may
not
be able to meet by increased cash
salaries
other
or
current
com¬
pensation.
Third:
one
an
stock,
The
option offers
the few opportunities that
executive
has today
of ac¬
of
an
estate.
(And
I
have not reached a point
a bad thing
cumulating
hope
we
where it is considered
for
an
executive
to
portunity to acquire
Fourth:
have
an
an
op¬
estate!)
The
stock option may
tthe sole means by
executive can acquire
offer virtually
which
an
stock in his
by
urged
own
goal
company, a
Lewis
other stockholder
k
AT
SOUTHERN NATURAL GAS COMPANY
.Since 1930, when
D. Gilbert and
representatives.
operations,
crease
benefited
in value
stock.
AND SINCE LAST YEAR
through
of the
an
Net
Income
Income
Per Share*
Dividends
Dividends
Paid
Per Share*
$5,321,472
$1.55
$4,790,707
.
$1.40
,,
company's
1954
1954
amendments,
on
$59,110,525
$6,497,643
$1.89
217 billion
$48,329,135
$7,036,615
$2.06
* Number of share* outstanding:
v
1954
3,445,004
1953
3,422,102
"
■
.
the company's stock.
This "reces¬
is created in two
ways—one through the so-called
variable
price option, and
the
other through permitting options
245 billion
1953
the
hand, go too far. In effect,
they create a depression or reces¬
sion option—one which may have
value no matter what happens to
For your copy
of
our
»
1
1954 Annual Report, please write the Secretary at the address below.
option"
to be amended.
Variable
A
Revenues
(in cubic feet)
other
sion
began
...
Sales of Gas
as
in¬
;
The
company
variable
which
fixes
terms of
a
'
Price
•'
.
1
Options
price option is
the
option price in
percentage of the mar¬
ket price at some time other than
•nm
SOUTHERN
-
one
%
steadily with the
option had value only
to; the extent that stockholders
class
grown
expanding Industrial Southeast.
of the Revenue Act of 1950. Under
a
have
•
These .are, I believe, good ob¬
jectives and they were objectives
that Act, an
predecessor
our
ive
•
NATURAL
GAS
.
.
t"
COMPANY
WATTS BUILDING, BIRMINGHAM,'ALABAMA'
■
SOUTHERN
NATURAL
GAS
COMPANV
asso-
page
wold of Harvard Law School sug¬
out
cor¬
employees in the affairs
of the business." When I
favored
the
price
the interest
of 1950
Act
debated,
treatnient
example,
so.
Revenue
being
For
27
t
28
26
(1518)
The Commercial and Financial Chronicle
Executive
important question of whether a
so discriminatory has, for
the most part, been a matter of
Compensation
administrative
Undei the 1954 Revenue Code
fundamental
Holds
and
Code is deficient in
new
Predicts staggering unanticipated tax
loss in
revenue
the
old
five
she
who bought apples
apiece and sold
four. She explained that
able
was
of
think
least
ever
us
may
for
anti-trust laws—the
as,
Act, the Clayton Act, the
Act
at
are
—
important. But Mr.
is
completely
was
in
pages
bill
a
length
of
(and
875
some
not
double
triple-spaced'either), with an
accompanying report (a splendid
document) of 577 pages of com¬
ment and explanation. The House
Ways and Means Committee had
or
V. Henry
Rothschild
taxes,
that
fact
when
even
a
working on this legislation
the
Treasury
since
1951.
Particularly as reported to and
passed by the House, this was a
tremendously impressive and am¬
case
ing unnecessary dollars, no matter
stitute
those
of
dollars
are
bitious
write
document—seeking to
the
law
so
to
as
re¬
remove
uncertainties, resolve conflicts in
for
law
and
interpretation, sub¬
objective
statutory
administration
rules
Regrettably,
is
This
it's
pretty obvious, but
tend to lose
sight of the obvious in the field
of executive compensation.
The
reason
is
that
taxes,
combined
how
with
we
inflation, have ravaged sal¬
a certain bracket, and
had
to
invent ways
and
discretion.
finally
as
enacted
of these laudable objectives
many
failed of
accomplishment, notably
in the field
of executive compen¬
sation.
new
Code
makes
changes
here
and
The
portant
but
im¬
there,
the law
in
the last analysis
patchwork of changes rather
aries above
is
we've
than
a
fundamental revision. Par¬
a
of restoring to executive ticularly in the field of executive
jcompensation some semblance of compensation the new Code, like
paeans
,the purchasing power it once had.
We've had to dream up new plans
of
capable executive
to get some kind of decent secu¬
rity for himself and his family—
new
plans under which he may
permitting
be
well
if all goes
able,
does
a
and he
well, to build some kind of
estate.
In
with
and
amendments tacked
there.
Many changes of sub¬
yes;
but
comprehensive
stance,
revision
in
this
uncertain
field,
no.
•
Now
address that I delivered in
here
on
the
let's
Code
take
does
look
a
at
does not
or
what
for
do
July, 1953, I grouped all such
plans in three general categories
insofar as tax impact is concerned,
categories of
compensation
plan
mentioned
aboye — deferred compensation,
namely:
stock plans and plans
One:
that
Plans
defer
the .re¬
each
and
to
level
to
bear
as
so
bring
out income
lower
tax
brackets—so-called deferred
com¬
pensation.
Two:
that
benefits
tax
1
Deferred
Let's
there
rates—principally, stock
Three:
benefits
the
Plans
that
difficult,
a
which
not
are
executive
at
but
all
result
in
taxable
to
—
not
obvious'y;
impossible,
of
What
does
to say about
the
new
Code
have
plans in each of these
categories?
I
ternal Revenue Code of
1954, was
to the Houseful Repre¬
sentatives on ,March 9.
reported
1954,
behalf
of
Means
Committee
the
Daniel
A.
i
.
House
by
Reed,
K; g*
'An
the
compensation
hand, qualified
deferred profit-
one
.pension,
and
retirement
plans
relatively large group
of employees, and, on the other
hand, non-qualified plans usually
a
confined
to
tive
group of top executives.
or
a
tax
may
individual
an
Qualified
Plans:
be
benefits:
The
entitled
no
tax
execu¬
qualified
tq: specific
on
the
em¬
ployee until he receives benefits;
a
capital gains tax if payment is
am
the
man
tax
general
made in
going to be rather critical
Code, so I want to say a
few
nice
things about it first.
H. R. 8300, which became the In¬
of
For
two
are
of
deferred
plan—on the
plan
objective.
field
compensation.
group
plans, and
the
purposes
sharing
covering
tax
first
deferred
tal
by the executive at capi¬
gain rather than ordinary in¬
Compensation
take
received
come
involving np
p..
types
Plans
three
tax.
ceipt of compensation and spread
the compensation over a period of
time,
the
of
Ways
on
and
Congress¬
its
Chair-
' i *
address by Mr. Rothschild before
National Industrial Conference
Board.
-.New York City..
on
a lump
sum; no tax at all
appreciation in the employer's
stock
when
employee;
employing
are
made
income
to
connection
cure
these
plan must,
criminate
a
distributed
to
the
tax deduction to the
as payments
plan; tax-free
company
into
a
the
trust
with
established
the
plan. To
substantial
as
in
you
se¬
benefits,
of
stockholders, supervisory
compensated
in
a
know, not dis¬
favor
officers,
or
highly
employees.
The determination of the highly
/
yardsticks
would
as
have
for
discretion.
While
con¬
provisions in the House bill
included
25%
or
more
of
be allocated among partici¬
pants of the plan in proportion to
salary or the plan may be dis¬
qualified as discriminatory. So as
permit
awards,
individual
the
within
House
limitations
incentive
bill
have
would
allowed
25% of the company's annual con¬
tribution to be allocated among
employees
cretion,
salary
in
the
company's
without
administra¬
specific
were
plan.
what
Non-qualified
gard
to
the
plans:
House
With
non-qualified
re¬
deferred
arrangements, the
long been in a highly un¬
certain and confused
1940s,
state.
In
Commissioner
the
ternal
non¬
some
ambiguities and unanswered
ques¬
issued
Revenue
the
In¬
of
few
arrangements
it
situation
A
and
year
half
a
responsibility shocking.
was
in
1953, the tax
in the deferred compen¬
sation firild'ik
even
worse
deferred
death
ployee;
there was
the employee had
if
death bene¬
a
payable
by
solely
of
the
em¬
exemption
no
non-forfeit
a
able right to the exemption durir
his life. The 1954 Code now
pro¬
vides that the first $5,000 of death
benefits is exempt from income
whether or not an employee
tax
had
a non-forfeitable
right thereto
during his life, but this is true
only of a lump-sum benefit pai
under
qualified retirement plan.
a
non-qualified plan, the
employee's rights must be for¬
a
Under
tinuing to require consulting and
advisory services and non-com¬
sound.
basic
and
By first adopting and then
abandoning this approach, Con¬
gress has left the field even more
uncertain,
ambiguous and unpre¬
dictable than before.
There is
tax
on
great deal to be done
a
legislation by the
Con¬
new
One of the first and
gress.
important
subjects
have
must
which
on
legislation
most
we
is deferred
compensation.
The
changes
Code
new
the
actually made
sions
in
the
A
sum
to
re¬
Provi¬
so-called
pro¬
hibited transactions, such as loans
lump
security or rea¬
interest, have been made
applicable to funds established in
connection
with
Provisions
relating
business
qualified
income
plans.
unrelated
to
heretofore
ap¬
payment to
em¬
an
ployee under
a qualified plan has
subject to the capital gains,
been
rather
than
this
lump
ordinary income tax,
has
been
not
payment
sum
a
benefi;
a
ciary of the employee.
also makes lump
to
of
true
to
The
Code
sum
new
pay¬
beneficiary subject to
gains tax.1' This tax
a
capital
treatment is not applicable to pay¬
ments under non-qualified plans./
(4)
without adequate
sonable
A third dis¬
by the 1954 Code
between qualified and non-quali¬
fied deferred plans relates to ap¬
plication of the capital gains tax.
the
bill.
con¬
made
ments
House
relating
by
Capital Gains:
undertaking
ambitious
flected
(3)
tinction
minor compared
are
for
reason
petitive activity!
but
Changes Effected by the New Code
have
trusts
to
been
also
under
Last
Retirement Income
and
least
is
the
Credit:
retirement
income
credit, under, which the
tax (in the first tax,
bracket) of
$1,200 of so-called retirement in
constitutes
come
Apart
ture, the
changes
Code contains four
new
specific mention.
it
is
These
widen
still
further
the
fied
plans
group
and
of
tax.
a
credit
Estate
Tax:
The
tax.
estate
Many
concerned
lems
in
overlook
to
businessesmen
so much
estate
tax
be at least
can
important
and
great deal
more
entitled
if
he
company, its tax deduction would
have been allowed when payments
in
The
bill
would
taxes
on
the employee in the case of an
annuity purchased for him by an
employer until the employee ac¬
tually received payments under
been
widow
For
money.
Law
Institute
Forum: In
May, 1954, the Practic¬
ing Law Institute held a two-day
the
on
the
House.
tax
bill
The
as
passed
persons
part in this forum
who
were,
on
hand, those with first¬
experience with problems
one
presented by the various sections
with
a
ex¬
execu¬
$10,000
a
minimum
provision that
a
die
an
before
he
has
total of $100,000, his
a
will
receive
instalments.
income
income
for
credit.
the
The
estate
to
the
from
The
widow
will
at
estate
Federal
estate
ments
1954
or
rents,
form of
as
ment
are
qualified
provided
made
than
now
confers
immunity for
a
by
contributions
rather
c
result
a
of
or
of
pay¬
retire¬
such
pay¬
attributable
the employer
emplovee and
the
oi
dividend?
of
which hi
with'
compensation.
II
Stock Plans
We come now to plans involv.
ing benefits subject
to
capital;
gains
tax—stock
plans
and, irf
particular,
restricted
stock
opf
tions.
If in
sation
field
the
deferred
compen¬
Congress did little o
nothing, in the stock option fielc
Congress, in my opinion, did fc
too much.
Tax
;
benefits
of
stock
periods
if
holding
othe
tax
woulcj
either<<the
grani
met,
were
imposed
on
exercise
option.
Revernr
certain
observed:iand
were
the
the
by
That Act provided i:
that
be
con¬
certain type
on
option
conditions
first '
were
ferred by statute
any
plan,
ments
is
pension
a
or
$1,200 of income
out his deferred
the
under
this
of
-
that this
interest
or
will have
The Code
tax
purposes
reason
in the
annuity
Code, there
possibility of an
liability under quali¬
least the
tax
gc
consequence, apart
small
amount
of
the
the
or
the
fied plans.
to
both
tax,
widow.
was
an
also be sub¬
may
on
to
also
credit, is that the executive wir
balance
the commuted value
payments still owed to
the
of
the
will
point of least
substance
state,
rati
retire¬
non-qualified plan would prob
ably riot be considered retirement
Act of 1950.
and
credit
the
a
ecutive's estate
ject
bracket
Deferred compensation undei'
up.
subject to income tax on the
unpaid instalments, but the ex¬
Prior
Practicing
of
a
be
annuity.
The
to
should
paid
tax
increased,
ques¬
equally
involve
often
retirement for
certainty by providing specifically
for a tax on the employee
only
in the years when he is
actually
receiving payments. As for the
postponed
first
be
compensation that they have tend¬
10 years,
have
the
with income tax prob¬
the
field
of
executive
of
made.
of
attorneys have been
year on
were
first
these^ changes has to do with the
and
would
further
ment
come
(1)
deductioiV entirely. The House bill
un¬
if
nov
usually have other retirement in
receive
this
non¬
qualified plans.
case
removed
be¬
gap
tween the tax treatment of quali¬
ample, take the
have
changes,
interesting to note, tend to
tive
lose its tax
na¬
amendments to the law deserving
ed
that the company may
and
relatively minor
a
tions which
perhaps not at all. If the em¬
ployee is properly protected
against such a tax, the fear arises
these
from
changes of
but
should
qualified plans.
and
hand
be
the
qualify
feitable:—another
improvement, but the
approach
was
reasonable
receive payment for many years—
took
to
of
To
for
today.
compensation ar¬
rangement when the arrangement
is made, even though he may not
by
exemption,
had
reason
from
exempt
tax.
applicable
any
statement which received
a
as
the
income
made
assume
forum
fit
rendered
was
Federal
an
benefi¬
or
he
issue
part of the Treasury officials
the
ciary
dea
of
20%, the maximum credit is $240
to
fied
employee to his estate
for this
of
death
institutions
but for the last
has steadfastly re¬
wide publicity, I referred to this
situation and called the failure on
Bad
$5,000
the
on
tional
arrangement.
to
first
Since the first tax bracket is
a
rulings at all,
Treasury has failed to is¬
sue any regulations or to take
any
official position upon this type of
the
the
plicable to foundations and educa¬
years
in
1951
benefits paid
rulings,
private
ago,
In
Thursday, March 31, 1955
.
tions. Undoubtedly there was room
the
compensation
law has
on
to
for
provisions
left
to
other earnings.
or
much
House
The
qualified
dis¬
reference
bill would have done for qualified
deferred compensation plans.
few
satisfactory
substituted
must
fused
the
I
favor
the
under
which
approach
been
Among other important changes,
the House bill permitted some dis¬
cretionary allocation of
profitsharing awards. Under existing
law, a company's contribution to
a
qualified
profit-sharing
plan
So
plans,
believe
tive
The uncertainty in the law has
its
predecessors* is primarily a
led to the fear that an employee
recodification, a general reshuf¬
fling and renumbering of sections, may be taxed under a non-quali¬
■
an
ex¬
discriminatory in favor
key employees.
to
who
and the
tax-deductible.
surprising
of
been
with
in an 80%
tax
out of every $100
of salary was in effect being paid
by the government, the other $20
came out of the company's coffers.
You don't make money by spend¬
was
bracket and $80
many
Some of
statement
Here
these companies
say, it is the government that is
paying the salaries.
They over¬
how
to
understandable.
cutive
company
top
monu¬
be something of
may
equally
Reed's
years
the
entire
legislation
Robinson-Patman
compensation
practices. With
look
of
our
Sherman
com-
high
from
It is the most
piece
example,
explain their
our
system
that legislation such
when asked to
exe
tax
...
exaggeration.
an
panies over
the past several
Federal
the
qualified
to
some
pro¬
considered
•
overhauls
Well, that
thinking
some
Bill
attempted by the Congress."
story pretty
well reflects
the
Bill,
are
statutory
*
so
that
Well,
10%
the
regard
House
the company's employees (but not
less than 10) would not have been
out
the
unfortunate.
was
law to be generally
it
is.
Personally,
.
'"the
mental
apples.
many
reporting
this
there
re¬
what
the
which
relief.
Mr. Reed said:
bottom.
a
profit because
she sold
In
man.
cents
make
to
story of
lady
them for
were
will upset President Eisenhower's Budget esti¬
.You all remember the
for
key
leakage and huge
mates, and indefinitely postpone tax
to
as
left
discriminatory
if
more
open to objection, I think the bill
10%
of participants were could have been
revised so as to
employees. Key employees eliminate the need to secure rul¬
defined as the highest-paid
ings on non-discrimination for the
(but not over 100). A plan usual
pension or profit-sharing
than
door to abuse in fields of stock options and fringe bene¬
opens
fits.
yardsticks
think
With
sidered
of deferred remuneration,
area
change in this
bill specifically
vided that a plan would be
magnificent technical achievement, it is "a thing
patches" regarding executive compensation.
a
in
constitutes discrimination. For
ample,
shreds
I
the past. The House bill attempted
a
statutory
Mr. Rothschild maintains while 1954 Internal Revenue Code
of
determination
arrangements—and
law pretty much as it was before.
gard by substituting for adminis¬
trative
determination
concrete
By V. HENRY ROTHSCHILD*
Attorney-at-Law, New York City
represents
fied
plan is
..
of
no
an
employed
.
If the option price was
of the market price
least 95%
time
the
profit
subject
option
to
the
option
taxed at capital
option
but
on
price
sale
taxed
of
at
the
stoij
would b<)
gains rates; if th<
less i than 957.1
was
less
not
granted
was
of
sale
on
af
a
than
the
85%,
Stock
a
profil
would
br!"l
bv the bill, and, on the
hand, representatives of the
Treasury Department
who
had
are
made to a designated bene¬
ficiary other than the executive's
income
ta:
rates but only up to the
spreacr
between market and option pricf'
estate.
at the time the
worked
conferred
covered
other
The
on
these
forum
sections.
brought
flaws in the House bill.
the forum and
held
out
annuities
many
Following
hearings thereafter
by the Senate Committee
Finance,
the
Senate
on
eliminated
substantially all the major nrovisions in the House bill
deferred
those
and
compensation
relating
those
to
relating to
—
qualified
relating
to
A
both
plans
non-quali¬
No
similar
on
under
similar
cally
and
on
under
a
is
survivor
qualified
a
immunity
conferred
annuities
immunity
joint
is
plan.
specifi¬
payments
or
non-qualified
plan.
new
rules
pertaining to
estate tax immunity thus call for
review
(2)
were
of
all
existing plans.
Death Benefits:
change
relates to
The
death
seccpd
benefits.
option
some
was
granted
ambiguities ir
the Revenue Act of 1950.
ample, it
tax
tive
result
was
should
beneficiary
exercise the
cor
Forex;
not clear what
be if an
would
unexercised
The
a
There
ordinary
die
and
with
if
should
option.
his
his
then
th»i'
execuj
optior^
estate
seek
o
'
The effect4
p o fate reprganizationsj ant
changes ,in the, stock subject t<
optipn ,was likewise not.Jn_.all, re
Volume
181
Number 5416
The Commercial and Financial Chronicle
...
the
time
Tax
Code
at
changes and
some
granted.
in
these
rule it will still be to the tax ad¬
give an
the right
to
buy so many shares of his
company's stock over the next 10
years at a price equal to 85% of
vantage of the executive to
the
market
the
time
spects clear.
makes
The
desired
clarifications
respects,
in
new
the
law
although
pointed
in
out
it
should
that
passing
be
as
a
exer¬
cise his option during his lifetime
rather than have his estate or his
beneficiaries do
may
option is
option
example,
executive
value
he
the
when
For
an
the
of
exercises
stock
the
at
option.
(1519)
Thus, if
a
stock is selling at $100
when the
down
only
him to obtain tax
the
benefits. Under
to
exercises
option is granted, under
prior law the option price would
have had to be at least $85 for
it
seems
pay
$50
the
the
and
executive
option at that time,
that
the
executive
$42.50. This
need
to be
seems
result,
may
although it is by no
means
clear, and regulations have
not yet been issued.
granted and if the stock goes
states
options
Internal
1954,
a
Revenue
Code
variable price option
of
The
that
Committee
variable
"widely used by
are
their
of
being
treatment'
Continued
was
on
vigorously
the
stock
favored
options
attacked.
1954
SOUTHERN NATURAL GAS COMPANY REPORTS FOR
was
Gris-
Dean
wold of Harvard Law School sug¬
that it
gested
a
was
hand-out
a
to
special group of taxpayers with¬
out
25
In
"decent
justification." There
was a flurry of
law-suits by mi¬
nority stockholders — a couple of
years
much has been
them successful.
added
The operation of stock option
plans since the 1950 Act has been
the
subject
Perrin
of
Stryker,
cently
with
published
Magazine.
sidered
results re¬
"Fortune"
in
Thirty plans
and,
.
.
in The INDUSTRIAL SOUTHEAST
to the
resources
of industry in
Mississippi,
were con¬
Alabama, Georgia, and South Carolina
mid-October,
of
as
.
under
study
a
1954, 263 officers under 21 of these
plans had paper profits aggregat¬
ing $21,000,000, or an average of
$83,000 per man. Perrin Stryker is
adept at presenting both sides of
and to the capacity of
...
Southern Natural Gas,
serving the industry of these states.
'
without
revealing his own
However, reading between
lines, I have the impression
that he thinks it open to question
whether stock options "increase
a
case
views.
his
incentive
executive's
an
to
im¬
He
ap¬
earnings."
prove company
pears
To agree with the Griswold
view
that
of
ment
the
the
preferential
stock
to'justify.
easy
Revenue
is
not
'
I don't agree.
the
treat¬
option
In the first place,
Act
of
did
1950
not
confer preferential treatment, but
restored
the
of
everyone
what
been
for
decision
preme
many
in
thought it had
years
prior
to
a
States
Su¬
Court in 1945—and the
res¬
by
was
no
Moreover,
should
be
not
of
terms
tive
the substance
to
of the United
toration
plete.
law
com¬
options
stock
thought of simply
supplying
which
would
exist. There
means
incen¬
an
otherwise
not
at least four other
are
\
justifications for the stock option:
First:
tively
The
stock
granted,
differentials
tween
option, selec¬
to restore
compensation
of
..?3
be¬
41
management
eliminated
were
H
tends
in
levels
which
.
over
the
half by
taxes,
inflation and two periods of
stabilization.
salary
past decade
and
a
Second:
The stock option may
essential
holding power
against competition for executive
supply
talent
which
a
company
may
not
be able to meet by increased cash
salaries
other
or
current
com¬
option
offers
pensation.
Third:
of
The
stock
the few
opportunities that
executive
has today
of ac¬
cumulating
an
estate.
(And
I
hope we have not reached a point
where it is considered a bad thing
one
an
for
an
executive
to
have
an
op¬
portunity to acquire an estate!)
stock option may
the sole means by
which an executive can acquire
stock in his own company, a goal
urged by Lewis D. Gilbert and
other stockholder representatives.
These .are, I believe, good ob¬
jectives and they were objectives
Fourth:
The
offer virtually
of the Revenue Act of 1950. Under
».*•* *.
k-.f ■
AT
SOUTHERN NATURAL CAS COMPANY
Since 1930, when
our
predecessor
company
began
-
operations,
have
we
grown
steadily with the
expanding Industrial Southeast.
AND SINCE LAST YEAR
that Act, an option had value only
to
a
that stockholders
the extent
class
crease
benefited
in value
stock.
The
;
of
through
the
an
the
on
hand, go too far. In effect,
they create a depression or reces¬
sion option—one which may have
value no matter what happens to
the company's stock. This "reces¬
sion
option" is created in two
ways—one through the so-called
variable
price option, and
the
other through permitting options
>r
A
variable
which
fixes
terms of
a
Price
Dividends
Dividends
Paid
(Income
Per Share*
Per Share*
i
.
t J
,
1:.
...,
245 billion
$59,110,525
$6,497,643
$1.89
$5,321,472
$1.55
1953
217 billion
$48,329,135
$7,036,615
$2.06
$4,790,707
$1.40
* Number of shares
For your copy
Options
price option
is
our
option price in
percentage of the mar¬
ket price at some time other than
3,445,004
1954 Annual Report, please write the Secretary at the address below.
:
SOUTHERN
'
■
WATTS
one
1954
•
'
the
of
outstanding:
•
»
Variable
Net
Income
1954
amendments,
other
to be amended.
Revenues
(in cubic feet)
company's
»•;
1954
Sales of Gas
as
in¬
NATURAL
'
■
GAS
1
:i.•
:
hii-'.
■
.'tf
"
c
•
COMPANY
!••',(,
?.'«»-«• T,'.t..
BUILDING, BIRMINGHAM, ALABAMA-
•
-
1953
3,422,102
asso-
page
so.
debated,
of
cor¬
employees in the affairs
of the business." When I
When the Revenue Act of 1950
was
price
porations to encourage the interest
What is the explanation for this
the
be
provision?
new
report
27
28
'■
'
28
(1520)
Continued from page
a
27
Executive
be
other income.
exemption might
even
apply to payments made
during an incapacitating sickness
incident to age, and conceivably
might result in a tax-free pen¬
in
salary
Compensation
Under the 1954 Revenue Code
or
the
Literally,
Salary Stabiliza¬
we
Board
tion
hibited
made
price),
a
compre¬
study,
in
collaboration
with the Securities and Exchange
hensive
in
hardship
a
option
Committee,
the
said
"worked
in
reduction
a
the
case
stock that had de¬
Commission,
of all options
on clined in value, since situations
record with the Commission. We developed where the option price,
found
no
wide-spread
practice after a modification, extension or
applicable to the so-called vari¬ renewal, had to be higher than
able price
we found
option. On the contrary,
a
bare handful of such
of
options
on
the market value of the stock."
hardship? I don't under¬
options among many hundreds of stand this point of view. There is
hardship only if you consider an
plans examined.
Although
the
Committee re¬ option as a guarantee to the ex¬
Why
a
price ecutive that he is going to make
option provisions appear to have money no matter what happens.
been adopted with the American The 1954 Revenue Code tends to
Telephone
and
Telegraph
and make an option a heads-I-win,
similar employees' stock plans in tails-you-lose proposition.
ports do not say so, variable
T. and
mind. The A.
Plan is a
T.
stock purchase plan, but since the
employee can be relieved of his
commitment to buy, what he has
lias been ruled in effect an option.
But
provision could have
for this type of plan
surely
been
made
Stockholders
Controlling"
leaving the stock option
Before
final
about
word
to say one
amendment
an
controlling
to
relating
want
I
amendments,
stock¬
The Revenue Act of 1950
holders.
impairing the structure denied tax benefits to stockholders
over
10% of the com¬
and concept of the restricted stock owning
pany^, stock. The 1954 Act now
option prevision.
tax
benefits
to
these
The
concept of an executive extends
stock option has been to encour¬ stockholders if the option price is
at least 110% of market value and
age the executive to plug for a
steady increase in the value of his the term is no longer than five
company's
stock.
The
variable years. The explanation given is
l>rice
option
can
conceivably that the amendment is intended to
stockholder-employees to
create an incentive in exactly the enable
without
opposite direction. The executive
may actually gain from depressing
the price of the company's stock
so that he can pay cheaply for it.
Take the case of an executive who
1,000
an option to buy
of
his
company's
Receives
shares
stock
period of five years. At
the time the option is granted, the
stock is selling at $100 a share.
over
a
option price is fixed at 95%
■of the lowest market price within
The
a
period of six months from the
date
when
tion,
as
new
tax
exercises
he
the
op¬
is permissible under the
law. When the option is
granted he would have to pay $95
a
stock. Let's
that the market value of
share for the option
assume
down to $90. At this
point, he could exercise his op¬
tion as to, say, 100 shares and,
subject to the reservation stated
above, it appears
that he may
have to pay only $85.50 a share.
(I
say
"appears"
because
this
■seems to be the result under the
the stock goes
law, but this result is by no
means
clear
and no regulations
new
have
yet been issued.) Moreover,
six months, the market
value goes down to $80,
it appears
option price will be re¬
$76 a share. In other
words, the more the stock goes
down, the cheaper the stock to
him, and it may thus be to his
the
that
duced
to
interest to
see
the stock go down.
Furthermore, he
exercise
to
his
may be tempted
option in instal¬
ments and play the market.
I submit that it
ing. The declared purposes of the
stock option section, as stated in
connection with the Revenue Act
of 1.950 and restated in connection
with
the
Code,
new
to
are
en¬
"incentive
devices
by
corporations who wish to attract
new management, to convert their
officers into 'partners,' by giving
courage
them
stock interest in the busi¬
a
to retain the services of ex¬
who
might
otherwise
ness,
qualified group
plans, with the requirement that
the plan not discriminate in favor
key executives or highly paid
personnel as in the case of pen¬
sion
in the
direct interest
of the corporation."
success
1954 amendments
The
do not ap¬
to be in keeping with these
pear
Ill
third
The
of a quali¬
eliminated
by the Senate and, as finally en¬
acted,
there
is
no
prohibition
against discrimination and ' there
appears not even to be a require¬
ment of a group, except to
the
ever, the requirement
fied group plan was
extent
that
needed
as
last
and
category of
plans
are
providing benefits that are
The
Code
new
contains
provisions helpful to cer¬
tain of such plans.
provisions relate
and
health
plans.
important
accident
Under
plans of this nature, meet¬
the Code tests, the employ¬
ing
er's costs
is
no
deductible and there
are
tax
the
to
premiums
on
employee either
by the em¬
paid
ployer for the employee's account
or
benefits
on
The
received
by
the
covered
by
the
statute
that there be
the
rare
situation will the variable
price option be of heal advantage
to either.
Modifications
Under the Revenue Act of 1950,
once
an
option
option
could
was
not
the
granted,
be
amended
option price. This made
There is much to be
cauMpr allowing management.to
participate in increased values to
stockholders which management's
efforts may have helped to create.
The entire concept, however, is
lost when the option price, al¬
though fixed, can later be reduced
good
sense.
and the executive
fit
whether
can
the stock
thus bene¬
goes
up
or
permits
option price
re¬
The
new
d/action
there is
value
including
care,
in
law
the
also
if
not
only
a
20% decline in market
a
12-months
The previous rule
period.
(which
pro¬
by
care
for
care
ployee, but also
and dependents.
phy¬
for
the
his
em¬
spouse
Compensation for per¬
injury or disability—e.g.
manent
Third:
sight.
or
Loss
of
$100 a week.
Except
for
ceiling,
on
earnings
to
up
$100-a-week
to
appears
the
period
be
no
the
or
amount of tax-free payments that
may
thus
be
earnings, and
year
employer
to
vided
the
in
made
a
thus
can
lieu
of
total of $5,200 a
paid by the
employee
tax-free basis,
an
is made
on
a
pro¬
dur¬
ing the employee's absence from
account
injuries
or
scarcely
a
an
of
sickness."
personal
This
is
negligible amount; for
executive in
a
50% tax bracket,
technical
far
achievement, but, inso¬
compensation is
concerned, it is
patches.
The
Code fails
new
legislation
in
compensation.
the
stock
of
It overlegislates in
option
field
and
opens
also
abuse
wide the door to
opens
in
field
the
accident
further
creates
empting
benefits
fringe
from
nature
and
health
of
where the Code
uncertainty. Ex¬
plans,
tax
this
of
be
can
very
the tax status of
the entire fringe benefit field calls
costly.
In
fact,
for
comprehensive review.
The
in
conferring
tax
ad¬
vantages
on
such
benefits
is
purpose
laudable, but the result must be
weighed against the effect on the
national budget and the great loss
to the Treasury in revenue.
Insufficient
consideration
given to
a
the
Code. I
new
Continued
estimates
message
will
informed that
am
from first
in
result
a
the
relief
tax
time to
recent
his
far
prove
that
and
further
some
budget
too
opti¬
of
chances
slight
are
Instead of
come.
sidering tax relief,
for
con¬
84th Con¬
our
well have to keep
busy tightening the revenue laws
gress may very
and
closing loopholes.
Fortunately, there are few com¬
panies that run their business like
the little old
lady with the apples.
majority of companies
not going to grant variable
stock options indiscriminately or
The
great
are
adopt health and accident
other
or
fringe benefit plans just for the
tax
savings.
was
number of provisions in
Eisenhower's
revenue
mistic
the door to abuse. '
It
as
President
to legislate
is
field
the
revenue
this
of
urgently
and
needed
mate of loss of
deferred
thing of shreds
a
is
equal to
provision for the entire
country as a whole. I predict that
the amount of unanticipated tax
leakage from the new Code will
be staggering.
I am afraid that
executive
as
provision a single com¬
claiming a tax saving
the Congressional esti¬
one
pany
count
We
the
on
continue to
can
good
and
sense
judgment of American enternrise.
page
icies and
possibly individual ben¬
efits paid pursuant to an estab¬
lished
practice.
whether
Economic
However, I doubt
Internal
the
Revenue
Service Will acquiesce
in such
interpretation without
a
says
is intended
to
The Guaranteed Annual
struggle,
apply regardless of
whether the
plan covers one em¬
ployee or a group of employees.
Prior to the 1954 Code, the tax
law pertaining to health and acci¬
dent plans was uncertain. A com¬
prehensive
review
of
the
law
prior to the Code and of the Code
itself was made last month by the
"Yale Law Journal," which con¬
cludes
that
creases
"the
Code
new
in¬
unpredictability
judicial
in this area."
Life Insurance: Another
provision of the new
that
exempting
from
is
estate
the
tax
proceeds of insur¬
Previously,
such
policies
paid
employee.
have
been
eliminated
by
the
Code
as
a
factor,
and
group
policies
in
which employees have no owner¬
ship interest, have, as a result,
the
attraction
added
estate
an
tax
of
the
on
escaping
demand
sion
of
such
The
and
"Perquisites":
plans stemmed from
in
other
limited
situa¬
tions.
Prior to the 1954 Act, an
employee could not deduct trav¬
elling
expenses
unless
he
overnight
his
or
the
duct
still
1954
the
tions.
However, union demands
have
been
modified
who
standard
and
deduction.
contains
to
sales
pro¬
execu¬
so-called
are
de¬
can
expenses
also
by
he sacri¬
"outside
salesmen."
They
can
deduct
travelling and other expenses, in¬
cluding entertainment and com¬
others,
as
if self-
employed.
on
the subject of
non¬
taxable benefits, the law has been
somewhat relaxed on the taxabil¬
of
apartments
or
other
and
pany
used for
a
liv¬
com¬
executives.
If
living quarters are located at the
place of employment and the em¬
ployee
must
to
or
get
rental
accept
keep
value
of
his
the
not be taxed to the
a
large
old
extent
this
"convenience
the
quarters
position,
quarters
employee.
restores
of
the
the
will
To
the
clear when the 1943-44 pro¬
posals
with
compared
currently.
are
advanced
In
those
ployer" rule in determining taxa¬
bility of homes
furnished
employees.
by
a
or
living quarters
company
for
its
effective
Alternative Types of Guarantee
In terms of the financial cost of
the
plans, they may be
proposed
clasified
(1)
follows:
as
Unlimited
weeks
full
at
guarantee
for
pay
52
—
all
em¬
ployees.
(2) Unlimited guarantee with
designated provisos — protect all
de¬
minimum weekly
for the life of the contract
guaranteed
a
to be two years.
was
hourly
of
rate
preceding year
(c)
earnings in the
plus any wage in¬
the financial
companies.
upon
with
v/as placed
obligation of
year.
guarantee
obligation
specified cents
to
hour
per
of
its
made
demands
integration
to
above.
(2)
anteed wage plans
guish
in
last
the
Many of the
plans.
of
the
fails to distin¬
three types
these
between
unlimited
not
apply to the
reserve
it.
cerned
In
the current pro¬
effort to make them
to employers, are de¬
general,
an
palatable
signed:
limit protection to em¬
To
(a)
ployees with designated seniority
(usually one or two years).
(b) To provide for payments
into
fund
reserve
a
based
cents per hour or a percent
upon
of the
payroll.
(c) to tie in the payments with
state
insurance
unemployment
payments, and
(d)
Sometimes
to
limit
the
full time earnings.
Under
these
covered
tected
would
worker
be
fund
longer
an
tee
a
for
the
pro¬
is
solvent.
It
unconditional
year
much
until
several
of
antee—the
the
years
with
the
fund.
the
on
discussion
ago
was
unlimited
1943-44 steel
In
econ¬
up
con¬
guar¬
proposal.
Apparently, the critical evaluation
of
those
earlier
proposals
was
convincing because the more re¬
cent union proposals represent a
drastic modification of earlier de¬
mands.
I
In
hasten
that
making this statement,
that
add
to
the
limited
I
recognize
guarantee
may
represent only a first step—a case
of
getting the camel's
nose
in the
tent.
Therefore, it is important to
evaluate the impact of the unlim¬
ited guarantee as representing the
real objective.
it
should
be
But if this is feared,
stated
so
otherwise
may seem
the
explicitly
criticisms
to be unreal in terms of
the program under
of
Incentive
The
no
discussion.
Rather,
unemployment insurance,
companies paying the
the
The
hope
is
that
as
pressed
ordination
with
will
goal
liberalization
as
to
amounts
and the coverage
funds.
these
and
duration
provided by the
be
of
C.
U.
frequently
ex¬
a
result of co¬
employers
U.C.,
induced
difference between the designated
Advocate
to
Liberalized
guaran¬
longer.
or
is
the proposals involve a liberaliza¬
with
and
only to the extent that the
reserve
tion
omy,
because
proposals,
criticisms
guarantee
terms of the impact
posals in
the
on
be limited by provisos
may
similar
re¬
meet
of its financial consequences may
differ
years
per¬
a
the extent
Drains
resources.
significantly
from this proposal and reflect the
strong criticisms directed against
few-
only
or a
fund which is used to
the wage guarantee to
fund
con¬
—
pay
centage of the payroll into
of
no
was
unemployment insurance.
The
period which
a
a
Much of the discussion of guar¬
limitation
No
Limited
tractual
received.
crease
be less than
may
serve
The wage was to equal 40
the straight time average
(b)
times
liberal percentage of their
a
(3)
(a) All steelworkers should be
which
ity at
that:
manded
wage
employees with designated senior¬
weekly income for
steelworkers
1943-44,
state
em¬
be made in
provide
,
guarantee to something less than
Finally,
ity
significantly
during the past decade. This be¬
deduction.
Code, he
helpful
home
reimbursed
unless
travel
Code
visions
tives
or
standard
such
use
from
away
was
employer
ficed
his tax return
on
was
Steelworkers
negotia¬
in the 1943-44 basic steel
Code contains provisions
new
helpful
further exten¬
a
the proposals of the
the
proceeds.
for
to
Wage
can
integration with U. C.
Gamble, Hormel, and Nunn-Bush.
The
laws
state
those in effect at Procter and
are
changes
necessary
The most widely cited plans
omy.
(d) There
Expenses
years.
they have not covered
important segments of the econ¬
the
by
payments
of
number
a
However,
ance
policies in which an em¬
ployee has no incident of owner¬
ship.
for
country
comes
Group
Implications of
an
though the Senate report
that the exclusion from tax
even
be
payment
"ion
As finally
ing quarters paid for by
the
there
limitation
requirement
"plan."
a
missions paid to
Second:
work
over
follow¬
sicians, and hospital and surgical
care,
completely
down.
the
First: Reimbursement for medi¬
cal
ob¬
the statute seems broad
enough
to
confer
tax
benefits
upon
individual insurance pol¬
The
to< loss of limb
reduce the
of
those
up:
enacted,
ing nature:
are
the
within
Under the
benefits
to confer tax benefits in this way,
of
group
a
braced
Accident and Health Plans: The
to
be
may
policy from an
insurance company, and except as
the
term
"group" may be em¬
taining
directly
not taxable at all.
most
group
a
prerequisite
a
Premium
Tax
No
executive compensation
those
How¬
subject to estate tax if the
premiums were directly or in¬
Involving
Plans
plans.
were
proper purposes.
and that this
provision is going to
give rise to abuses. It is to be
hoped that company and execu¬
tive will recognize that only in
retirement
and
Code
more
nue
of
leave, or to give their employees
a
these
tax advantages to
important
generally
confined
bill
House
The
ecutives
employee.
unfortunate
was
company
they procure outside financ¬
when
within
if
their
of
control
retain
The Internal Reve¬
Code of 1954 is a magnificent
sum
where
sion.
the
with
To
Thursday, March 31, 1955
...
from
Summary
payment of this nature
the equivalent of $10,-
$5,000
would
000
elated
i'.
•
The Commercial and Financial Chronicle
to
the
press
state
for
a
unem¬
ployment insurance laws in order
newer
The
net
effect
of
proposals is to limit
significantly the degree of fi¬
nancial responsibility assumed by
a
company
anteed
if it agrees to
wage
a
guar¬
proposal and if the
to
reduce
tions.
made
of
their
financial
Reference
to
a
obliga¬
sometimes
is
change in the attitude
employers toward the liberal¬
ization of the OASI benefits after
/
Number 5416
181
Volume
.
.
.
a
pensions were introduced in mass
It is inferred that it was
pension tie-in with old age
security payments, that the OASI
benefits were liberalized in 1950.
their
payments under the pension
own
The
program.
adequate interpre¬
an
developments of that
tation of the
which
agreement on pensions was
The
1949.
House
tives
enacted
OASI
on
did
not
large
Oct.
and
of
power
small
em¬
a
company
operates
will
liberalize U. C. in a similar man¬
ner.
find
Representa¬
of
liberalization
a
balance
therefore, that all states in
ance,
Steel
reach¬
ed
on
Nov.
1, 1949.
Ford had
adopted such a plan in September
Bethlehem
The
period.
among
ployers,
farmers, workers, and
independent voters, varies from
state to state. There is no assur¬
1949-1950 indicates that
is not
this
political
between
the timing of
brief survey of
A
events in
costs
with 51 state and
territorial jurisdictions, the prob¬
lem of liberalization of U. C. is
much more complex that it was
for OASI, for which the change
had to be made only by Congress.
liberalization
the
movement in order to reduce
However, the
of
Moreover,
According to this theory, employ¬
supported
incidence
companies may differ if they are
shifted in part to U. C.
because
of the
ers
cost to employers.
final
production industries.
of
A
company
itself
probably would
dealing
with
a
wide
variety of situations in terms of
its
responsibility under
financial
specified payments into a
fund.
integration with U. C.
Implications of Unlimited Versus
Limited Guarantee
(Reserve Fund)
Strange
as
it
may
seem,
all
management cannot be in agree¬
ment
as
to
which is the more
desirable
proach if
the "least worst" ap¬
or
a
be
to
guaranteed wage plan
adopted. The economic
characteristics of
a
company or an
be decisive in this
For example, an in¬
industry will
connection.
dustry
ment
with
expanding
employ¬
(growth industries) or with
stable
employment
prefer
a
might
known cost of
limited
its
(3) The goods
a
reserve
liability,
(4) The goods
the
It
few
is
not
GAW
unlimited
an
plans
-
consumers.
con¬
(1)
in
that
have
industries
produce
firms
The
(8)
It
is
only
in
industries with
(as well as
characteristics
these
which
those which
growing), where
guarantee will not be costly,
the
are
that the unlimited* guarantee does
consumer
involve
not
(2) The goods are non-durable,
Continued
semi-durable.
excessively
an
financial
burdensome
cost.
on
5, 1949. The Senate
a bill for increases
pass
until June 20, 1950.
The President
signed the bill on Aug. 28, 1950.
Of
even
greater
importance
than
these
minimum
cents
laws
from
40
an
hour. This
wage
75
to
how¬
developments,
the liberalization of the
ever, was
cents
on Aug.
Aug. 31,
1949, and was enacted into law on
Oct. 26, 1949.
The recommenda¬
tions concerning pensions by the
Steel
Wage
Board
were
made
early in September, after a mini¬
mum
wage bill had been passed
passed the House
measure
Senate
1949, the
11,
on
by both Houses of Congress.
in
increase
The
the
minimum
reflected mainly the rise in
living costs after the Fair Labor
wage
Standards Act
The CPI
was
passed in 1938.
by 70% from 1938 to
minimum
rose
On this basis, the
1948.
had
wage
cents
rise to
to
at
"It's all right...
least 68
real
hour to be equal, in
an
terms, to the 1938 total. However,
since it is generally agreed that
living costs
hour
minimum
there's
for the low¬
rose more
est income groups,
With
made
allowance
right here, too"
recognition by Con¬
this
telephone
a
the 75 cents an
for this factor.
of the importance of making
gress
adjustments for the sharp rise in
living costs, it
similar
for
miide
was
adjustment
While
logical that a
should
be
OASI
the
employers
stances
in
payments.
in¬
some
changed their attitude to¬
The
proposal, it is in this
compensation for inflation rather
effort
employers in an
pension costs,
explanation is found
the
reduce
to
that the real
for the liberalization
of social
state
legislatures.
may also be
There
of
ment
financial
the
a
stairs
telephone is
interest
of
tional
liberalizing U. C.
Employers pay the entire cost of
unemployment insurance against
employers
in
Great
posed seniority requirements for
eligibility for the GAW payments
and the burden of unemployment
a
liberalized
fund
reserve
a
and
room
an unnecessary
.
.
.
to
waste
when addi¬
so
little.
thing for Mother, too. For
will
And
save
her
many
steps.
give her greater (peace of
un¬
mind, especially at night when she
employment
compensation pro¬
gram is greater than the payments
into
to
telephones in the kitchen and bed¬
room
falling on 'those most
recently
hired, many companies may even
cost of
running down¬
room
telephones, conveniently
placed, cost
half the OASI cost. With the pro¬
the
from
or
of time and energy
misjudg-
appreciates
convenience in his home.
same
He knows that
se¬
curity benefits. The Unions may
be overestimating the influence of
employers on Congress and on
may
telephone at
a
his elbow in the office
than pressure by
find
who has
man
the
ward
hence
may
be at home alone.
not get behind the liberaliza¬
All
tion movement.
There
is
action
united
to
reason
no
expect
of
this
convenience—and
safety too—can be yours at small
by employers. Em¬
ployers will fall into two groups:
cost
(A) Those who will have much
larger than average unemploy¬
Just call the business office of your
and
ment
hence
would
have the burden assumed
by
other
employers
like
to
through
for each additional
local Bell
in part
telephone
telephone.
company.
a
liberalized U. C.
(B) Those who have
expanding employment
stable or
and who
might have to bear part of this
increased financial burden despite
merit rating.
It
is
second
difficult
group
to
visualize
the
of employers rush¬
Bell
ing to state legislatures to demand
a
more
liberal U. C. with the
Telephone System
ac¬
companying rise in their tax rate.
On the contrary, these companies
could be expected to oppose such
a
movement toward liberalization.
The
important
point is that
a substitution for the
U/ C. is not
Digitized for cost borne by employers;
FRASER
it is also
SERVICE
THAT'S
WORTH
SO
stable
generally
are
small units.
been,
goods.
or
a relatively
demand.
(7) There is
consumer
the
following characteristics:
They
are easy
(5) There is differentiation of
product.
(6)
They are finished goods
when
manufactured,
ready for
with relatively
guarantees
concentrated
have the
accident
or
to store;
there is little risk in style changes.
fund with
to
necessities
are
conveniences.
common
latter.
tingent unknown costs involved in
an unlimited guarantee.
plan with an unlimited
guarantee as being less costly than
the
than
Conversely, industries with wide
cyclical fluctuations, such as dur¬
able goods industries, would of
necessity
have
to
choose
the
(industries
selling necessaries of life)
less
cost
reserve
alternative
former
The
could
is
29
(1521)
The Commercial and Financial Chronicle
MUCH...COSTS
SO
LITTLE
And
page
30
The Commercial and Financial Chronicle
(1522)
SO
Marih 31,1955
Thursday,
...
J-
1
.
Continued from page 29
.
,
1 ■
FfATtAlHir VmnilfAflMIQ fit
JUvUAlVllftiv
•XllJfllvflllVAliI
mi
1
■
.
these
various
clauses have been
escape
tnc.udeddin
The
the
plans,
existing
wide fluctuations
and in employment
in
conditions,
in
opportunities
the ,durable
goods industries,
the other hand, have acted to
<m\
rescrain
them
from
wise,
limited
do
companies
not
set
aside
extent
inclusive
of
they
subject
mc
Moreover,
.7^•?*■,? iM,e mV00Hh0m Hiri
.
tn+Ql
r.n<Ti«
lahnr
SSL.h linf5 vS
nlnpA
ifl,,, touiu
unbearable
an
2" .V> stabilize
tiUities
under
mmnanv
cui
ipdiy uiiuci
nhiective
mainr
A
n
financial strain.
nf
ihe
emolovment oppor-
Most
?orooonents
fche hone that such
a
exoress
will
program
Eiiice management under pressure
stabilize
to
production
and
em-
in order to reduce the
jffeuncial
obligation.
Paradoxicatty, the reserve fund approach,
wvii.h' its specified financial cost
%vc;jld
provide less pressure to
acttieve this objective than would
the
unlimited
guarantee
plans,
'The U. A. W. has recognized this
payment
problem. Point six of its 1953 progfflm provided "Financing should
abine pay as you go, to provide
cg
employers
with
incentives
Stabilize employment, with a
to
re-
trust fund to meet abnormal
aerve
cc&te." This
seems
recog-
limited
the
that
M&on
clear
a
reserve
alone would not
provide the
stabilize employment
incentive to
-ptdch is one of the alleged obof the GAW.
jeezaves
Ei-serve Fund Based
Fixed
of
aims
„.rl_
are used
qttv-olved
in
an
,,
pay-
wage
in-
From the point of view of
6ives
.
general
a
whether
>-?^iagement,
ire- ts
arevis
the
proposes
;'
nuur
hour
into
into
it
pays
fund
iuiu
reserve
leseive
a
o
general wage increase
"
"i
a
.
.,
<
,
important
•
warn-
Tt
maftpr
the
is
r0uld
end
sion and welfare funds since their
introduction on.a 'ar&e scale about
itation: senioritiy, relationship of
benefit payments to current income, and the duration of benefit
payments. The seniority limitation would probably be the first
to be liberalized, as the UAW has
already suggested.
agreed
be
much
that
doesn't
make
guarantee
wages
and then to exclude from protection those who bear the full brunt
of unemployment. Two
give
years sen-
to
way
■&-K
except ciuiing some
one
year
Duet propa-
tionary period.
jf
large
taxes on the
Moreover, the
involved.
unemployment
situations
may
,
.
ta
v
rra
l,»regram wouM
a
.
Tius
.u
u
the
in
absence
other considerations, the union
general
less costly than
e
wage
of
increase
the
amount
lose
the
to
its
greatest obligation.
.
jobs.
management would feel
leel
wnom
whom
0
their
employees
are
.
The pressure
1
—'
.
by workers with
-- ---
lesser seniority
Ic
not safe to
is
assume
that all
view-,
o
would
*.;-crease
-worker
r-ers, t e wase
be the preferable
many w
-ak^rnative.
For
with
example,
the
long seniority fore-
SpiiS an increase in income so that
fejre
income
be
can
fcv: those with little
stabilized
seniority. How
jfciv£ will he be happy with such
a
situation where his job
pii-ratively
fiind«;
funds
<?till
still
used
be
If
secure.
is
there
comis
a
The
.
P
under
the
workers
while
off from
cut
others
long
would
'have'
workers jnave
b^:pro-
that the fund should be*
re-
served in part lor employees .with
less than tliree years
servieg, in
for
service
the
three-
to
fiv^year
fdf
and in part
group,
the
route,
creation
effect, recognizes the
might arise and
in
that
pressures
reflects the potential liability to which employers may be
hence
subject due to such
it
also
may
lems,
if
any
a
future
create
part
of
exhausted and there
sure
on
Such
a
is
the
prob-
fund
is
little pres-
the balance of the fund.
breakdown of the
also
may
development.
raise
a
reserves
question
the
in
to whose fund this
as
plan,
To what group
wage
beJ0np?ux
in
is.
of workers does it
increased
costs,
jabor
necessity
prices,
ment
receive
npith^r
neither
the
grease nor the benefit payments
control
products.
tv,i
=
11
"
sures,
the question
as
pres-
to whether
„=tin
a
the
f-'-
liriinn
Thic-
io
nr.
nmn
rigidity of
for higher
of
manage-
demand
for
the
A detailed evaluation of
each of these arguments would fill
one-or
books.
more
All
I
do
can
is to discuss briefly several aspects
of
rcsources-
The GAW as a Built-in Stabilizer
in recent years, a new term—
"built-in stabilizers" — has found
jts way into economic literature,
This term refers to the effects of
unemployment insurance, OASI,
income taxes, and farm supports,
chit
•^-s
such
payments
labor
are
costs
made
U>raductivity,
be
added
to
when
with
comparichanges in
of
living, and
cost
power
ferent,
although
there
might
'with
greater,. emphasis
capital goods.
upon
would lead to
Whether this
rate of
a
capi-
new
tal investment which could not be
sustained, is an interesting question.
If it did, such a situation
well& aggravate
verv
very
wen
decline
the
aggravate
the
recession,
the
on
provide
hand,
compensating
a
they
offset
to
the consequent reduction
the
swings in
this
in
segment
could very well
rather than moderate,
economy
I recognize, of
that the incentive for new
capital investment might be damp-
GAW
It is claimed
will
act
to
strengthen these tendencies.
At the outset, it
should be noted
the business cycle.
ened
during
demand
gjn
incentives
to operate
until
decline
a
in
economic
boom
a
held
were
during
avoidable.
I
triggers the built-in stabilizers. It
know
these
stablbzer,s cfnnot from taking
Prevent ecofluctuations
However, they may act to
magnitude of the swings,
limit the
if
be
recession if
a
demand
consumer
how
do
consumer
down, and that
might
activity takes place. In
other words, it is the decline in
activity or unemployment which
nomic
•
,,
,i.
companies
volition establish
of
their
sustained
collapse in
a
that
there
is
fund
serve
noorer times, oresumablv such
poorer times, presumably such rere-
OASI.
OASI,
farm
farm
than
^jian
would
wuuiu
be
be
held
beld
spending
in
bal-
will
simple
or
re-
,
of
a
th^GAW
has
these
arguments
others
are
based
are
on
Many of
emotional,
social
or
eco-
earlier, and the
U.C.,
income
1
offsetting
*■
tax,
impact
the
on
flow
net
of
funds to
*
reductions
•
u
in
i_
other
COuld
0
not
.•
to make
resources
the
an^ at
its Mother
periods
4
•
of
continue
spending,
purchasing
on
would be relatively small,
actual
result
might even be
negative if the financial stability
0f
companies
many
ened
as
result of
a
were
threat-
large-scale
un-
tended to supplement U. C.
If the
monies paid into the reserve fund
wise
have
creaSe
that
been
wage
*v»
+
the
would
available
rates-a
stabilizer
effect
this
depend
funds
the
during
the
For
be
it
is
held
the
type
in
these
example,
benefits
years
posed
who
is
some
workers who
limited
have
two
as has
unions
are
laid
will
of
where
seniority,
bv
It
involved.
tions included
Gonverselv
recession,
many
upon
workers
boom
programs
problem.
to
follows: There would
the
the
cance of any
depend
in-
as
fund
built-in
other facets of
The signifiimpact obviously will
upon
the magnitude of
are
same
other-
reasonable
reserve
same
omy
to
as
In
which involve a flow of funds
into and out of the private econ-
for
be
GAW
the
have
not
assumption—the impact is alleged
Murine
boom
j
proposed
will
There
What about the limited guarantee in terms of cents per hour, in-
amounts
or
subject needs additional exploration, I am inclined to believe that
employment
were
of expansion
1
available
time,
same
programs
Thus, the net effect
power
_•
_
contrast, the proposed reserve
funds would operate„solely within
these payments the private economy.
While the
its
use
funds
the
shortest
in-
or
term
gov-
In-setting
up
for these
program
funds, it is important to keep in
mind that they differ significantly
from the pension funds which
much
longer term in
tives.
The
would
have
GAW
to
funds
reserve
be
are
their objec-
liquid,
more
particularly since, in general, they
would be making net payments
at
when
times
economic
declining.
was
activity
/
:
.
Unlike the OASI and U.G. funds
which
confined
are
to
investment
jn government securities
funds
reserve
to
of
in
extent
some
ust
could
stocks
and
invested
diversified
a
bonds
then
in
If
this
prosperous
funds
reserve
likely to add
the GAW
be
are
their holdings of
to
these
Qf
securities
tions
in
some
These
crvra-
buving and selling could
influence
rities market.
accentuate
advances
the
on
If thev
secu-
operated
and
to
declines
jn the general level of stock prices
the
funds could be
reserve
an
un-
stabilizing factor
T
in„ncinrc
l_
f
^.
1
.
nrVp?
g
.
9ro
.
infinpnpp
from the government,
government.
or
of
:
these
the form of cash
investment
of funds to the purchasing
of funds to the purchasing power
power
:
honds?
and
of
resources
ernment securities?
built-in siauiiizeis uijeiaie through
ouni-ui stabilizers operate inxuugn
their
types of business spending. Business
the
The government contributes a flow
j
they follow the
funds and
stocks
dictate that they be kept to a large
other
other
and
and
program
program
purchasing stream through these devices dur'
power of workers during periods ing a period of recession and with0f recession, as the wage guaran- draws
some
purchasing power
tee is met, there would probably from the private
economy during
also
limita-
programs.
eligibility
to those
three
or
been
pro-
then
the
off earliest
.
An_raf:pnc
{linj,
f .
tain
thP paw
h_vp
.
u
tuprp
there
f
that
upn
lfho
nf
^
^.-11
will
up
™vacinn«!
occasions
fun^Wiii
riti
fh
.
f
b.een the case for
sion funds
hp
be
rp^rw
„pl1
f.
r A w
.
h
f
.of the pen"
to this time.
,
,
,
.-^Jesxe dangers
can be reduced
if the funds are invested in shortterm government securities. How£ver> ev^n this type of investment
would have
which;- must
he evaluated. The effect would
depend upon who was selling or
buying the government securities
For example, if the government
bonds are bought from the com-..
merciai banks, as is likely in large
measure, the banks will be in a
better position to finance inventory accumulation, consumer
credit stock market credit, and
oth?r ^Pes of credit expansion
^unrig the boom. The sale of bonds
by the banks would act to reduce
total deposits while the new loans
would
result
in
the
creation^ of
"ew deposits.
In effect there
would be a transfer of deposits
fr0l£ those who bought the bonds
that workers' incomes would be would not receive any benefits to those who were making the new
better sustained and that this de- from the reserve fund. This low loa"sv,WlYle ,tb®'£eVeffect .W°md
velopment, in turn, would act to seniority group, which would vary Probably be littl^change in the
hoId
11U1U
up
Up
L-U11&U1I1CX
consumer
demand
UtTIIlcinU
and
(JIIU
in
X"
relative
iciatx
importance
among
thus to limit the magnitude of the companies, would not receive
an
arars &
bee^fkrted'i'n bee"
variety of arguments.
referred
I
differences
contribution
contribution
some
some
in-
the probable fluctuations
have
economy.
workers'
While
times.
the maintenance
will
these
would
would
upon
boom
mieht be
might be
Or
done
rather
There
There
in
were
lainei
nivesteu
restraint
no
no
there
there
invested
be
ue
in cash.
in cash.
Will
invested
times
sure
the
The
serves
serves
bonds?
be
munici-
or
pattern of the pension
he
to
significant
are
GAW.
upon
considera-
reserves
government
be
forces
no
on
which
reserves
be drawn
these
to
It is also important to note that
in
times to
pal
in
pretend
appears
not
blueprint of the impact of the
in
boom
Will
careful
ance
I
th® t0 securities, while in a recession,
your attention so that you can see they would have to liquidate some
The
If
tion.
vested
course,
that built-in stabilizers do not be-
ex-
invested'must
are
given
an
aggravate,
recession.
a
be
to finance new capital investment
during
the
also
vested in
of
power
considerably
in which the GAW
manner
extent in
the reduction in purchasing power
that
The
reserve'funds
out money on balance. This
would curtail the funds available
the
to
GAW
The Investment of GAW
Reserve Funds
pay
tuate
other
been
am
con-
made
stability by the
the purchasing
has
other hand, the reserve fund would
with
l
the
be
can
me pe invested in stocks ana Donas.
economic
activity.
During
which
through
that
believe
to
economic
in
in
these factors,
of
tribution
be
boom.
the
inclined
differences in the structure of production
light
pur-
activity in that area of the economy.
New capital investment has
On
in
would be little dif-
which operate to compensate for
changes in the private economy,
They draw funds out of the pri-
Irgsassrasss srajs?«s Bp*
ofc-'er
The total volume of
subsequent
....
„
purchasing
more
chasing
couia
..
of
power.
could
resources
less spending for consumers' goods
f
hght of these potential
'fl the financial guarantee will be
i?Ur, revive fnnH ,niia llm'ted }° ah? Pa;menJs lntoTJbe
I
reserve fund is not academic. It is
hfn ti^ ifriinn Thb, 1.^ of critical importance r evaluatm
t reauire^ greater analvsis th^n
ing the ultimate impact of these
nf
inability
and
to
^
would
U.C.
present
liberalized,
aggerated.
man,
a
over five-year service group. This The
proposal,
the
if
were
ings which presumably would be
invested and in turn lead to the
jng
bp
Workers
.
posing
be
benefits?
Electrical
.
with
tried to meetthis problem
rpiority requirement of two years future
ehgdmity
for
seniority
,
Or if there are
avai
ah p
available, wr»nld they
would thov
programs
potential liability incurred in hir-
own
seniority
This contribution could
increased
be
boom the money paid into the reserve fund would represent sav-
longer
part
jfctirkers will favor the reserve
fed alternative. From the
pensation.
there
these
in-
bution to personal incomes would
be made by unemployment com-
case in its simActually, the situation is much more complicated
and there would be a number of
terms.
between the built-in stabilizers to
Yet
re-
little
plest
stabilizer.
is
the
have
boom.
This states the
exhausted by the time those with
fund
reserve
would
fund
serve
*
conditions,
ing power horse at the same time fluence during the early stage of
since they may tend to move in a recession. On the other hand,
opposite
directions
during
the during this period a small contri-
unlimited GAW will not
necessarily operate as a built-in
^•nirgs base for pensions will be
Ire.jt lower.
purchas-
consumer
costs, grow-
financial
tremendous
place.
scale
7—
social^ security
amounts
horse and the
these
jng immobility of labor, reduction
in
job opportunities because of
and, in addition, emphasize:
for^otectio^^fSfworkers ^ cl,e«r-therefore' Jhat the ,built"
°
be
as
a wage increase bearobablv will be unnecesit probably will be unnecesto pay unemployment taxes
and
people to ride the GAW Under
some
other developments which would
have to be considered. During the
I think it will
it
to
sense
^
o^ly than
security,
for
flve ye?rs a&° is also fresh in our
memories. Inevitably there will
been one of the most volatile elebe Pressure for liberalization in vate economy during a boom, thus ments in our economy. Any acthe three areas of proposed lim- placing a modest damper on that tions which would tend to accen-
3moun;
,
ments
well
verv
maucf- V cpuia X?ry wel1
°. y !7e beginning.
7e man"
ner in, w
^?
coal pension fund
costs have risen from 5 cents a ton
to
cents a ton in relatively lew
year.s' will be recalled in this conn.cction. The liberalization of pen-
(}e resajt ls would become very great and in
fejgher labor costs Interestingly some manner they would have to
1Pi° somewhat fund be that
reserve less
given treatment as favorable
w\'J tend
to
be
received
,
propo-
reduction in labor turnover. The
opponents challenge these argu-
,
per 7?Ur' many °+.
should develop,
are the same as those arise where the
3I„
pro biennis
-crease.
thp
?
designated number
some
in com-
that this
assUrance
b®
Hour
per
-
plan
a
of
<3'r
Cents
.
Where
nQ
iority will
Contribu-
on
welfare
an
the
eco-
ing is.in orc,er- The establishment Qf this problem. I shall consider
3
cents Per hour reserve the GAW as a built-in stabilizer,
f7nd aPPears to limit the liability the investment of GAW reserve
0 3 comPar,y- However, there is fUrids, and the GAW and mobility
nf
GAW
wages,
or
parisons today.
o
an
the
by
which
to
jrgperves to cover the un- fund payments,
fti4v.itea
(guarantee,.then
ex-
would
That this is not
pension
so^ie
themselves
or
gains
indicated
is
in-
presented in
unfavorable light.
unimportant,
as
or
equal to
are
productivity
.
costs
in
companies,
have its situation
im:>ortar>t >scale.
...fc
which
creases
uolpnited guarantees on any
suca
other
of
given greater
been
,
increases
total
as
ceed
into
entering
.
curred
large
UJJV
'
in other industries. Othera
company
which has in.
wages
demand
VAT
iftAftlftUU®
Jot
under
erca
1
Annual WftOP
91
till nT#II11 APfl
VliH»(«illvvll
if A
11V
®
V®
■
|
arguments
The
nents include: an increase in the
stability of the economy, provision of incentives to management
to reSularize employment, greater
productivity by workers who have
'
■1
considerations.
nomic
_-
nomic
COntendirig for years 'that. time
booms end because of
loan
deposits
are
certain
to
?h*—?—-——
pay. The net result could be accentuate the boom,
which, to a
an inade- a substantial cut in wage incomes large extent, is usually based upon
quacy
of
power.
It is going to be difficult payments from
consumer
total supply of deposit money, the
new
purchasing
which would not be offset by any
the
reserve
fund,
a
large increase in the extension of
credit.
Greater instability, rather
Number 5416
181
Volume
.
The Commercial and Financial Chronicle
.
impor¬
than stability, could be an
tant
.
On the other
the
effects
The
boom.
are
indi¬
what
on
they did with the funds.
For ex¬
ample^ if they used the proceeds
to finance new capital investment,
there would
Their
boom.
to
debts
repay
for
need
the
no
still
of
protection for those who
on the
payroll in other
Possibly
areas.
might
the
be
problems
these
integration
some
and the GAW
arranged to overcome
severance
pay
which
under
arise
Some Concluding Observations
the
other direction. To the extent that
longer term government securities
I
should
some
like
general
GAW
to
able agreement
revision of
laws, in order to increase
maximum benefits, is long over¬
conclude
with
observations.
The
many
complex
involves
unwarranted
laws
does
thing
problems. There can be no quarrel
same
ket
considered.
be
must
During
these
reserve
times,
prosperous
funds would
who
increasing
in
lose
their
jobs and their income through no
that
prove
be
time
employed
the
GAW,
designed
necessities
to
to
on
to
the
at
and
encourage
seek
provide
the
the un¬
employment;
other
hand,
funds
administered
are
the Federal
Moreover, the closer
corrte
benefits
fbll
to
not understand any program
is
other
must
confess, too, that I
can¬
which
those who are
unemployed substantially as much
intended to
is
as
paid
ployed.
pay
those
to
This
basis
of
basis
need
who
rather
to
em¬
means
wages
this
produc¬
for
the
no
U.
C.
about
This
be
because
paid
the
on
portion of the income, and
various
because
as
in¬
unemployed.
would
taxes
in
increase
comes
will
cant
expenses,
such
be
marked
seasonal
in
in
and
believe
any;
to
signifi¬
much
with
cyclical char¬
or
this
of
not
<
has>h already
area.
demand'
to
the
do
Much
done
control
barrier
stabilization
a
I
in¬
some
pressure of
for; industries
acteristics.
to
the
true
degree
been
May I also note parenthetically,
the payment of full wages
situation
will force
employment,
that
an
GAW
U:;~-Vr
be
may
dustries in which
the
dependents of the worker?
mean
there
the
in terms of the number of
would
While
on
Will the next step be to pay
tion.
,
employment.
on
than
contribution
of
are
apparently
to be paid
that wages are
Inability
is The
major
furthetfoprogress
elimination
;
of!
seasonal
cyclical
unemployment.
possible, it is -desirable
industry to reduced the sea¬
Where
for
sonal
swings in production. *' The
objective can be achieved^ in part
Continued
travel, lunches, etc., would not
Government.
AMERICAN MACHINE & FOUNDRY
on
32
page
bonds
be
can
Acqui¬
with
impact
less
the
on
awarded
private
funds.
reserve
underway, and
In any event, the problem
of
how these funds are to be invested
and
the
effects
of
these
ments, requires much
than it has received
The
GAW
to
has
been
GAW will
ticular
that
the
restrict the mobility of
factors
some
charged
production.
of
has
emphasis
Par¬
possible immobility of labor.
In,this connection, an interesting
situation
the
should
point of
low
labor
vvhile
the
entire
workers
view of
a
the
jobs
among
shift
be
may
adoption
the
of
de¬
of
guaranteed annual wage plan
a
re¬
duce the mobility of labor? Some
which operate in this di¬
factors
rection
already
are
in
operation,
pamely,,.seniority provisions and
tjne interest which many workers
have, in
now
pension
combination of
seniority, and
plans. The
pension program,
a
guaranteed annual
a
could provide
wage plan,
incentive
to
progress
nition of
New
in 1954
awarded highly classified
worker
a
strong
a
not
to
change his job.
Any tendency to¬
a
reduction in the mobility
labor is certainly not in the
^. i
"*>
'
.
defense
guided missile ground equipment... recog¬
Acquisitions
Bowling and Billiard Corp., Chicago,
Manufacturing Corporation, Binghamton,
BMC
Potter & Brumfield
III.'
N. Y.
Mfg. Co., Inc., Princeton, Ind.
Sight Light Corporation, Deep River, Conn.
The
These four
aries
joined AMF's family of subsidi¬
concerns
1954. The 1954 Progress Report
in
panies serving
industry, government and consumer.
The Future. In the short span
dramatic
advances
energy —one
in
the
of
one year
peacetime
AMF has made
use
of atomic
of the great industries of the future.
addition to the
sumer
tells in detail
fits in with AMF's pattern of com¬
how their acquisition
in
-
high standing in advanced engineering.
National
valuable,
the
was
second research reactor is planned
to be owned and operated jointly
point of view of
economy,
sirable., .Will
company,
is
turnover
from
AMF
the first privately-'
area
From
noted.
be
for
given
been
to
Products.
number of industrial concerns.
a
contracts
of
a
AMF has also been
AMF's 3-directional
Resources
,
.fit
by
study
date.
Mobility
and
for the New York
invest¬
more
Defense
&
prime contract to build
a
built atomic reactor for research. This project is now
uncoordinated actions of
than the
Research
Atomic
and
market
orderly
more
COMPANY
Progress Report for 1954 is out today!
by
sition and disposal of government
,
such
any
securities, ^while
U.C.
.
be incurred.
time pay, the less will be the in¬
centive
of
the worker to seek,
I
come
was
basic
discourage the seeking of
jobs.
new
some¬
should
desirable
would
be
competing to buy
in a reces¬
sionary period, there would be
competitive sales. In contrast, the
the
of giving some pro¬
not
less
U.C.
with the goal
those
delay
adopted.
funds,
to
a
The fact that there has been
due.
are
tection
that
these
for
acquired by the GAW reserve
the impact of their pur¬
chase and sale upon the bond mar¬
There is consider¬
past 15 years.
the maximum benefits under these
circumstances.
new
operate in
would
borrowing
the
stimulus to
a
use
reduce
to
or
be
exces¬
unem¬
might
vide
the
of
by
shift is
a
The
own.
Alternatively, the reserve protection. Unfortunately, the ben¬
be exhausted from efits paid under U.C. have failed
paying benefits to the newly dis¬ to keep pace with the rise in
placed employees and hence pro¬ wages we have experienced in the
narrowing of the credit base and
this would act to place a damper
purchase of bonds held
viduals
would
depend
such
of
their
of
fault
ployment insurance program was
designed to provide some such
sive.
fund
system, the effect would be
a
on
cost
the
hand, if the bonds
bought from the Federal Re¬
Were
serve
has assumed the responsibil¬
pany
ity of the GAW, it may find that
consequence.
$
(1523)
goods position, tremendous acceptance
famouS
This,
strengthening of its industrial and con¬
of the
continued recognition that
permanent and integral part of
Pinspotter, and the
defense contracts
are a
ward
Of
direction of the best allocation of
In
labor.
the
considered
flow
past,
desirable
it
has
for
operation-all
in 1955
are
highly favorable factors for AMF
and in the future.
been
labor
industries
those
into
its
to
which
expanding and for the supply
to contract in declining
are
labor
of
industries.
Chairman of the Board and
President
The danger of reduction in mo¬
bility
the
is "sometimes dismissed
that
ground
when
on
there .is
unemployment there are few
opportunities to shift jobs. This
mass
.
is
probably true to some extent,
although some shifting of jobs
|>ecome^' possible as employment
opportunities begin to expand.
Ho'weveij, there
when
are
other times
r6pbility is possible.
It is
willingness to
shift jobs when they are available
tJhe
reduction
which
fective
in
i^ of importance in the ef¬
Operation of an expanding
economy .,
-u.}n .addition,
periods of war
require large scale mo¬
bility of ^labor. This would be im¬
peded by the GAW. The result
could fcje a necessity to allocate
\yorkers if the required goods and
-emergency
services^
are
to
be
obtained.
American Machine & Foundry Company
Moreover, the GAW may act to.
limit mobility of plants. Often it
is
desirable
another
to
shift
section
of
ooerations
the
AMF
Bldg., 261 Madison Ave., New York 16, N
Please send
country.
me
your
AMF Progress Report for 1954:
The GAW maty have as one effect
X
the establishment of another bar¬
rier
a
such
to
This
f Jorr.e.
may
be
desirable barrier from the point
©f view
fs
shifts.
of
the
losing1 the
fs mot
desirable
to lose this
£'Jd(0\s~.
community which
plant.
for
However,
it
the, economy
flexibility. If tl?ej com¬
Y
to
<
.1
plY-r
-s/9V?-rH^
32
(1524\b
The Commercial and Financial
Chronicle
Continued
from
31
page
Economic
1955, but the cold war may con¬
tinue around Korea and Formosa,
Southeast Asia, the Near East, and
Implications oi
perhaps in other
In
The Guaranteed Annual
by producing out of season and
storing this output until needed.
However,
in
may
some
industries
limited ability to
undertake such operations.
Lack
of
finances, uncertainty of de¬
there
is
in
lems
etc.,
among the limiting factors.
The
full
space,
are
of
experience
in
1954
fluctuations
tremendous
(e.g.,
plan), or by the
higher rates during
as
a
partial or full
compensation for the lack of jobs
the
existence
understand
of
companies
how
in
GAW
a
would
have
must
be
sult
emphasized that the
of
not
the
first
alternative
re¬
is
had
ucts.
what
economic
is
accomplished is not ^
stabilization of job opportunities,
but
flow
is
stabilization
a
of
income.
evidence
no
of
in
the
rate
of
Moreover, there
any willingness
by the CIO unions to accept that
type
of
income
stabilization.
While
have
they
indicate
uniform
a
desire
a
pattern
to
of
jobs
throughout the year, when this is
not possible, union leaders insist
upon the retention of high earn¬
ings and overtime pay in the
seasonally
active
periods
and
GAW payments to compensate for
seasonal
idleness.
eating one's
This
cake
and
is
truly
having it,
too.
customers
Even
force
can
stability of job
upon the cyclically
industry. When the rail¬
In
that the GAW provides a solution
to the problem of
unemployment.
A
better
their
buying
of
freight cars, rail¬
road
equipment companies can¬
not provide as many jobs.
They
Continued
jrom
to
answer
this
problem
ih found in other actions, particu¬
larly government monetary and
fiscal policy, to limit the
in
the
swings
cycle and actions
business
by industry, to the extent
sible, to moderate seasonal
employment.
either
I
with
am
the
not
pos¬
un¬
impressed
extreme
claims
GAW provides a solution to
problem of unemployment or
the
that it will lead to the
GAW
or
are
conclusion, I do not believe
unstable
curtail
favorable
companies which fall by
wayside. The GAW will not
stop their decline, but it may
speed it up.
of
roads
most
bankruptcy
industry.
pain
that
—but
U.C.
At best, a limited
alleviate some of the
may
I
do
can
more
attends
believe
unemployment
that
this
an
adequate
better and
job
effectively.
The
the
in Western Europe. In¬
dustrial production there in Sep¬
24
tember
averaging about
10% ahead of the 1953 level, com¬
Jan. 27 from 3% to 3.5%. The ef¬
fect of these two discount rate in¬
pared with
creases
1954 was
decline of 6% in this
Production
not
was
in
Western
heavily stimu¬
so
from
3.5%
to
4.5%,
drastic
a
change in view of the increase
will be felt worldwide.
probably will reduce the
tiveness of
Britain; it will put
country. As a result, their recent
improved
business
activity has
goods
consumer
on
they
as
on
It
attrac¬
holding inventories in
lated in 1952 and 1953 by defense
expenditures as was true in this
proach
sales
the
we
of
textile
purchases
credit—or
damper
a
of
on
durable
hire-purchase,
call
similar,
but
growth.
The
shorter
a
general
dollar
balance
hold¬
ings of Western Europe, includ¬
ing the United Kingdom and the
sterling
area,
were
valued
at
than
more
$15 billion,
lion since the
parently
liberate
and
start of
there
has
$5 bil¬
up
1952,
been
a
Ap¬
de¬
policy to
dollar
build up gold
balances from avail¬
able funds rather than to increase
imports
from
the
dollar
area.
and restrain
raw
materials, for exam¬
copper, lead, zinc, tin, and
ple,
for
It is probable that the business
rise in the fall of 1954 was not
the beginning
of a sudden
up¬
surge in the cycle.
ger
in extending
future
the
summer
rate
up
There is dan¬
very
of
far into the
rise
from, last
to the present.
Busi¬
ness
about one-fourth of United
dollars rather than
goods has
affected
our
exports.
It
should
be noted, however, that the
trend
in Western Europe in recent
years
has been to reduce
discrimination
against purchases
of
somewhat
dollar
While the recent rate of rise
may
not
be
continued,
we
can
very
well be satisfied with the
present
level.
The Outlook for 1955
area
What
about
some
'
Since the level of
business ac¬
tivity in Britain early in Febru¬
ary was approaching serious boom
proportions, the central bank dis¬
count rate was
increased
on
Feb.
outlook
covered
situation
It
assumption iabout
for
war
in
the
by the forecast.
seems
does not
now
to
the
period
The
war
has
sharper cycle than
year
in
the
tainly
steel
resi¬
and
will
but
Cer-
production,
textiles,
half
be
hesi¬
half.
automobile
construction
first
good
to
some
second
output,
dential
activ¬
likely
seems
good first half with
tation
have
of
some
a
the
output may show up in inventory.
That is
particularly true of auto¬
mobiles,
textiles,
However, sales to
and
housing.
ultimate con¬
in all three
sumers
atively high.
output
areas
rel¬
are
A mild reduction in
would
bring
production
into line with consumption.
Inci¬
dentally, the estimated level of
business activity for the full year
is approximately at the level for
should
tention
same
concentrate
the
on
total
in
as
1953.
at¬
more
number
em¬
ployed—62 million, in addition to
the
3.2
million
forces—rather
in
than
the
on
Population
tinue to rise
three
who may be
unemployed
particular time.
a
Unemployment should average
lower than last
year, particularly
among the skilled normal labor
force. Since people not
normally
will
Continued
probably con¬
rapidly as in 1954.
around
increase
2.8
at
York
within
City
and
six years.
estimate
we
unfilled jobs.
ployment figures
The
a
cor¬
num¬
unem¬
based
are
suburbs
a
take
look
a
individual industries.
production
and
at
some
Automobile
retail
be
may
sales
sales
made
was
late
in
1954, and it is still going on, with
a major model
change introduced
somewhat earlier than other post¬
war models—with a seasonal
pat¬
tern
similar
sales
it
is obvious
industry,
before
February
than 35%
more
that
to
in
above
that
and
of
a
1940.
running
year
ago,
automobile
the
inventory
industries
true
in
reduction
this
1954.
construction expenditures
6% this
year over last
Principal increases in
year.
on
a
12%,
who
looking for work?" Those
answer
"no"
to
the
first
question but "yes" to the
second,
are
counted
as
unemployed.
Our present problem
of
unem¬
ployment centers in the
unskilled,
the
non
-
white,
and
income
the
very
after
taxes
will be somewhat
higher in 1955,
about 4%.
Wage rates are still
rising, and employment is in¬
creasing. Personal tax rates prob¬
credit is deducted from
gross sav¬
ing in arriving at the net
figure,
and it seems
very likely that per¬
be
improving.
sonal
likely that
It
debt
seems
power
will
continue
certain
will
be
that
to
rise.
purchasing
available
over
the past
personal incomes have
that "real" wages have
so
risen.
In
short,
1955 may be a good
year,
with business
profit
payrolls,
and
somewhat higher than 1954, with
competitive
volume,
little additional
Federal
support from the
Government
except
in
the
of
field
housing. Credit may
"easy,"
not
"actively
be
only
easy" as
the
was
Business
boom
level
but
the
over
rate,
it
of
the
the year
will
be
based
improve¬
At any
for '
year
selling.
It
will
also
continue
Federal
permit
debt
be
to
good
a
work
for
importantly
of
on
Government spending, to
reduction and
greater tax
reduction, and
an
increase in
private
spending or in state and
spending for roads, schools,
local
and
public
welfare.
believe it will turn
I
hope
out
and
to be
an¬
other year of
ing for
shifting from spend¬
to spending for peace.
war
With
King Merritt
(Special to The Financial Chronicle)
Rayle is
&
with
now
King
field
of
Co., Inc., Woodruff Building.
With Remmele-Johannes
(Special to The Financial Chronicle)
DAYTON,
hannes
wood
Ohio
is
&
Joseph
—
with
Company,
1126
Oak-
Avenue.
construction
in the
public
construction, de¬
pending on available funds, usu¬
ally borrowed, rather than on the
market
outlook for a product. In
words,
these
latter
two
types of construction do not re¬
spond directly to mild changes in
business conditions.
With current
construction, it
to
sup¬
seems
likely
very
that
Increases in construction, how¬
ever, are not universal.
Industrial
construction in 1955 will probably
be down around 5% from
1954,
as
1954
was
Industrial
down 10% from 1953.
construction
has
artificially stimulated since
by defense demands which
longer
so
insistent
almost $4
5%.
are
no
they were.
rise slightly in
Inventories may
Total business
almost
1950
as
1955.
fell
been
inventories
billion in 1954,
With
or
sales
rising,
with little price change ex¬
pected, there may be a rise of $1
...is the first of the
monest
seven
com¬
danger signals that
may mean cancer...but
always
mean
a
visit
should
to
your
doctor.
The other six
are—A
lump
the breast
usual
or
danger signals
thickening, in
or
elsewhere...Un¬
bleeding
discharge
or
...Any change in
mole... Persistent
wart
a
or
indigestion
difficulty in swallowing...
Persistent hoarseness or
cough
or
...Any change in normal bowel
habits.
and
billion in
inventories
during the
year.
The price outlook suggests little
change
on
or
probably
some
decline
the average in non-farm
prices
during the year. They were vir¬
tually unchanged throughout
1954.
There will be increases and
decreases, like the
recent
rise
in
For other
that may
facts
some
about
day
cancer
save
your
life, phone the American Can¬
cer
or
Society office
nearest
you,
write to "Cancer"—in
care
of your local Post Office.
American Cancer
M.
Remmele-Jo¬
Housing Act
are
T.
Merritt
the gen¬
the
Highway
1954.
to
year
reduced
20%, and
Note that the high
construction
estimate
terms
erous
of
should
1954.
good
a
reach
spring
1955
year
year.
not
may
substantial
some
ment
last
case
activity
15%.
residential
is
young.
Personal
prices
highways
schools
basic
questions are,
working?" and "If not,
"Are you
are you
and
questioned
by the Bureau of the
The
risen,
in
were
while
declined
years,
also
than
un¬
likely to
con¬
thes^ programs will be com¬
pleted in 1955.
Census..
not
still
but
they
struction may occur in residential
in
country
2.5
increases
amount,
Incidentally,
Dannaher
up
business
in
than
year
last year.
be
in
greater
have
fact, there
be actual inventory building
this year compared with a decline
Total
un¬
with wage rate and
benefit
1954.
In
public interest in road and school
the
be
may
may
seems
SPRINGFIELD, Mo.—James
sample of 25,000 house¬
holds, distributed among 230 areas
each month
the year and
partly because there should
metal
was
It
with
activity rising, with probably no
tax
reduction
during
steel,
output, and ore mining,
may rise 10% this year over last
less
1955
in
its
Steel
year,
little
was
in
corporate
the past six months.
over
There
1954, when
activity declined
portantly
for the increase in business activ¬
ity
in
likely that prices will decline im¬
supporting in¬
rubber, glass,
etc., has provided strong support
dustries
little
since
manufacturing
7%, taxes were reduced signifi¬
cantly and wage rates rose only
least
at
up
of
10% this year over last year.
A
particular effort to stimulate auto¬
mobile
been
prices
show
let's
has
these prices
1951.
1953,
Industries
Now
There
among
change
the
A Look at. Some Individual
With
slightly.
prices, but the
change only
will
other
do not have
responding estimate of the
of
as
But note that while
the number of un¬
rate
It would add
and school construction
number of individuals counted
that
city the size of Boston, including
suburbs, every year.
of
employment
opportu¬
extremely favorable, we
always have a significant
are
million.
would raise the population of the
United States by an amount equal
to the population of Canada or
New
rubber
prices
the fall of
certain
reach four million again this
year. The net population increase
last year was
of
1955.
in the country last
slightly more than four
new high
record. They
a
level
fringe
will
as
in
plenty of
in
men
nities
employed,
business
be
in the labor force are
attracted to
it
when
shall
In spite
births
year were
armed
the
millioh
at
probably
improved
work for credit
be
million, the
seem
World War III will break
out in
expected
a
the
outlook
for ably will not
particularly in the
change significantly
Any forecast today of the in 1955.
Netherlands, Italy, Sweden, Den¬ 1955?
Personal saving may not
business situation must be based
mark and West
Germany.
rise,
partly
because
consumer
on
products,
of
automobiles
a
a
has
among
activity, there
ation
four cents per hour.
will
newly formed businesses.
larger,
business
The pattern for business
ity this
is
rate
also remain high in 1955 because
failures are always high
outside
areas
national
rubber.
activity has already risen
sharply, based on the automobile,
States exports,
excluding "special the Housing Act of
1954, and
category" materials, are sold to other
construction. It probably is
Western Europe, this preference
.approaching the peak for 1955.
Since
in
estimate
business.
ber
and
production
then
textile
and
portant
Gold
1945.
Business failures
the
industry will show
we
$25 billion to
some
and
our
estimate
business in
our
the
evaluating
We
industrial
country
that
in
use
forecasts.
That
The
may
industry, substantially higher
growth in industry gener¬
ally. Incidentally, that is one ap¬
imports. It seems ob¬
vious, therefore, that it will also
tend to reduce prices of
many im¬
of
since
ex¬
than
nomic
aid
can
industry
high growth rate in the chem¬
unemployed.
area
at¬
1955.
factor.
prices and the wide fluctu¬
copper
change
sharply in 1954.
rose
million,
chemical
it; it will weaken
been based largely on
peacetime the housing and construction
factors, and on American eco¬ boom;
it
will
support
exports
this
very
in
credit.
businesses will
new
been high since 1945, with
only
slight hesitation late in 1953.
It
Total
returning
a
ical
62
prevails
country.
to
may rise a million
this year over last
year to around
A Look Back and Ahead for Business
Europe
and
activity
mortgage
continue high
favorable
ac¬
pect sales in 1955 to be more than
5% better than in 1954 because of
We
a
business
January, 1955.
Employment
6
page
1954
over
trend
the
environment, there
the
opportunities
locomotives
with
buy their prod¬
many
that
Similarly, I do not believe that
GAW
would
return
tractive level.
these
fighting for
lives, they already
not
business
altered
incentive to provide a
number
of
jobs —if
every
maximum
larger annual income, but
a
change in the timing of
the receipt of that income.
And
a
rather
ment
the
these companies were
their corporate
will
buildup.
But
it will result in
1955 showing important
improve¬
significantly the pressures which
developed in that industry. Since
in other months of the year
(e.g.,
However,
it
To
1952, and by substantial inventory
weight on Chrysler
companies. It is
to
building
trades).
1954.
on
Formation of
year
carryover of some demand from
the steel strike in the summer of
smaller
difficult
Hormel
payment of
the season
than
sociations
for
a
tivity to the inflated level of the
spring of 1953—inflated by the
end of the Korean
buildup, by the
to
offset
and
better
for
a
rise
underscore this point. The impact
of the 1953-54 recession fell with
on
income may
be
by withholding part of the
earnings in the peak season for
payment in the off-season period
outlook
is
— may
be 5% better in
1955 than it was in 1954.
Such a
industry. It is only neces¬
to cite the automobile in¬
an
dustry's
seasonal
the
1955
mining
J
effects
areas.
diversify their operations, as
cal output of manufacturing and
have done, but they cannot
sary
storage
tion and
construction, with some
help from banks, insurance com¬
panies, and savings and loan as¬
specific position, let's say
industrial production—the physi¬
easily or quickly.
Moreover, the impact of changes
in volume may fall with differ¬
ing impact on various companies
style factors, bulkiness of
product with accompanying prob¬
in
somewhat
take
of business
a
mand,
of
Wage
replace the loss of large amounts
many
only
general,
business
port the expected rise in produc¬
Thursday, March 31, 1955
...
Society
I
Volume 131
Number 5416
LETTER TO
THE
.
.
.
The Commercial and Financial Chronicle
EDITOR:
(1525)
tinction
could
drawn
be
which
CI-pSJ~
If
or
Capital Gains Tax, and deplores a situation where labor is
given benefits to offset dollar depreciation while property
owners are discriminated against by the levy on
capital gains
Editor, Commercial
and Financial
Chronicle:
Your
editorial
of March 3,
"As
We
See
It,"
1955 invites comment
•
--
the propensity to address our¬
selves to one sector of a problem
on
at
time, to the negation of the
a
power
disciplines,
including
posedly objective science.
tax
base
would
disap-
have
we
example
a
1941
obligation
reLlted
on
in
"gain" of $11,000,
whereas
a
the
of
■
actual
in
to hardship might be made
between
sumer
the
application
as compared
property, but
no
this
of
to con-
such dis-
cancels
tax
a
gain
was
the
that
obliga-
.
n"
rida
Power
$63.50
.
per
,
L.
SANGSTER
,
°L
f
,
on.
,
headed by
area
palities
electric
area
and
five other munici¬
which
have
municipal
systems), the agricultural
around southern and eastern
Merrill Laka Okeechobee, the lower west
Lynch! Pierce' Fenner & Beane
and Kldder' Peabody & Co.
coast area' and Portlons of cen"
tral and north central Florida.
Net proceeds from the sale of The tourist trade is the principal
these shares will be used to pro- business activity in the east coast
additional electric
vide
for
and
other
and
gas
corporate
It is estimated that the
purposes.
1, Box 63,
will
approximate $77,300,000, of which
Boyds, Md.
18,
territory along the east coast
(except the Jackson¬
Florida
,
1955-56 construction program
March
S
Light Company at
share was made yes-
s0
H.
Route
nnn
&
,,,
.
facilities
s ls
this discrimination. Some distinc¬
as
Qn(-
f
of
ville
Offering of 305,000 shares of no
ora"4i7nceeTneri95re'pure wriUng'group
chased
...
flagrant
plies
area
in
served.
the
Peak demand
period
Electric service is supplied in 447
communities.
plied
in
Gas service
Miami,
approximately $41,300,000 will be
Lakeland
expended in 1955.
1955.
capital
gains tax,
in
occurs
January to March.
few customers in
and
is
Daytona
Palatka
sup¬
Beach,.
and
to
a
Holly Hill.
sup¬
the Fulbright Com¬
testimony concerning
can
mittee hear
to
saTe"
money.
tax
gains
LlgBBa
into
over
all
the
gains
reinvestment
capital
tax to capital
How
tal
the
particularly
Florida Power & Light Co. sup¬
electric service in most of
I ifvUl
GOIItltlOII SfOCSC OffCFfid
Index,
mone-
benefits. In the administration of
paying any attention, ever, to the
really fundamental factors. This is
carried
Price
is prohibited from realizing like $1,100. Popular belief prevails
prospect of solving anything.
There is an insistent allergy to
characteristic
Consumers'
adequate index of
residence, almost the entire capi
the application of this Index for
their advantage, whereas property
tion,
a
of
the
some
tary meaning were applied in the
case, for example, of the sale of a
the basic principles of the
resulting from depreciated purchasing
0t
the
Capital Gains Tax Inequities
H. L. Sangster points out errors in
Daimav 9
■1111103 lOWvl
would gainsay the basic immoral-
33
■
II
relation
stock
market trading
volume
price level, hour after hour,
and
with no mention of the
gap be¬
tween monetary practice and any
rational principle? This gap is the
of the base to Which the
cause
Beneficial
so-
called capital
gains tax is applied.
would be just as meaningless
It
to
talk
about
breadth
and
width
without any agreement as to num¬
ber theory and the specifications
\
of the units of measurements.
The key to
knowledge has been
by the lawyers; in
arbitrary
actions
as
the
Supreme Court determination that
"capital gain is a gain." Language
thrown
Reports for 1954
aWay
such
and
alike must be
money
tially administered
before
erty
impar¬
common
there
prop¬
be
can
any
meaningful exchange of informa¬
tion, honest exchange of real val¬
ues, or genuine justice.
.-J-.
.
.Significantly,
the
cultural
more
the
physical
noise
II
of
aspects
systems,
symbols,
and energies, studiously avoiding,
and prohibiting, any attention to
meaning. They are more intrigued
by
m
expansion of world's largest
system of loan offices
path of futility in confining
of
■
further
itself exclusively to the considera¬
tion
before
a
cipline which designates itself as
theory" pursues the
communication
ever
dis-^-
.•'information
same1
families served than
and
entropy
than
10th
straight
year
of increased earnings
by
sense.
alternative
The
to
Beneficial loans in 1954 continued
is communal property, be¬
money
the
of
cause
confused
false alternatives.
tates,
communal
well
as
resort
Inflation
to
provide
for,
extra
assistance
they needed to over¬
is
come
with
wrong
gains taxation must be considered
according to the error in its basic
principles,
ticular
by
not
of
servation
the
bad
empirical
effects,
in
titious
base
tax
caused
dereliction
of Congress
stitutional
duty
to
par¬
various
Its basic error lies in
areas.
ob¬
numerous
fic¬
a
by
in
regulate
this
of
fillment
valid
no
private sector would be
because the
free
be
then
to
in the
more ex¬
buyer would
beware.-
example
bad
The-
set
by
demands for
in
revenue
so
aside
economy
producing capacity. This
is freely admitted.
this
At
stability
The
The
continued
$536,616,263
Number of Loans Made
1,729,161
1,666,695
$345,331,314
$323,798,894
863
809
expansion of the
Beneficial
Loan
afford
will
an
System in 1955
lies in
more
for
opportunity
help
more
*
Instalment Notes Receivable
fami¬
communities than
ever
before.
Number of Offices
*
Adjusted for the recent two and one-half for
of
jor
a
beneficial
one
stock split.
The information contained herein should he read in conjunction with the financial
statements and notes appearing in the 1954 Annual Report to Stockholders. A Copy
loan is
a
;
the
Report Will Be FurnishId Upon Request.
purpose.
of
is
further
frequent
of
Index
base.
to
be
confused
necessity
Even
for
assuming
meaningful,
its
some
economic
sectors
and
prohibited to others.
For
ted,
$560,524,214
per
money.
application is arbitrarily reserved
for
$0.96
paid
Common Share*
de¬
no
standard
inflation of the
Index
the
change
this
or
is
$0.96
Cash Dividends
opinion-weighted Consumers'
Price
by
there
stage
measuring
$1.45
Common Share*
local level.
revenue
pendable
$1.55
Net Income per
the
at
that all consideration of
and incentive are pushed
by
the
consideration
of
equity
$ 14,116,311
are
hills already incurred,
pay
aiding the
the
government in its rejection of all
enormous
large degree,
Beneficial loans to
inhibitions in its requirements, re¬
sults
thus
living.
excuse.
A similar fraud operated
cusable
to
a
is difficult,
duty
and in some respects inconvenient
is
used
$ 15,197,593
Net Income
doing helped them
maintain their standard of
the
value of the money. That the ful¬
so
These loans, to
the
Con¬
a
ties, and by
1953
financial difficul¬
temporary
capital
1954
Amount of Loans Made
socialization.
What
Bill. II LII* BETS
families with the
many
facili¬
conditions
as
to
and
assisted
in
BUILDING,
WILMINGTON,
Subsidiary Loan Companies: Beneficial Finance Co.
Commonwealth
example, "labor" is permit¬
encouraged,
BENEFICIAL
Loan Company
.
.
.
.
.
.
DELAWARE
Personal Finance Company
Workinomen's Loan
Association, Inc.
ft'
34
he Commercial and Financial Chronicle
(152G)
Continued
from
is the effect
12
page
owing
business
system. This is good and promotes
stability
economic struc¬
But in dealing with the con¬
ture.
in
sumer
if
the
—
sumer,
has
con¬
please—our industry
obligation
to
provide
instalment
credit
on
possible.
as
market
mass
you
an
base
our
By
evaluation
of
means
whereby
we
can
as¬
ability and willingness
his instalment obligation,
certain his
determine
we
right
this
the
the
~
individual's
instalment
to
right
has
credit
Once
established,
been
market
mass
is then
consumer
there
the
this country is
been sold for
in
that they have
not
dollar
elephants
few
so
are
entitled to the going rate for such
While
week.
a
was
certainly meant to be a jest,
is a great deal
a
Jnat
it.
in
truth
When
credit
instalment
The
industry should be based
on
the cost of extending credit to the
risk
average
each
and
should finance
grantor
fair cross section
a
of all types of risks.
I
can
how preferential rates
see
be
would
select
granted
of
group
have
well
certain
a
borrowers
established
of
means
to
obtaining
basis other than for
and
who
ready
credit
on
a
instalment
an
purchase, but I fail to
see why a
would, through
what amounts practically to false
and misleading advertising, infer
institution
credit
to
the
general
public that this
preferred rate is available to one
and
all. If
cere
a
in
credit
a
grantor is sin¬
offering what amounts to
commercial
borrower
rate
who
to
the
applies
mobile instalment
average
for
auto¬
credit, I cannot
help but believe that he is either
deceiving himself as to his true
cost
of
operations, or he is in¬
trouble,
particularly
if
viting
there should be
modest
even
downswing in
economy.
relatively
a
our
national
:<■»
-
sible
reaching into marginal
credit groups as well as the select
anticipating
and
expecting
—
losses
such
on
cross-sec¬
a
further enhance the
popular
radio
and
TV
comedian
sales
promotion ef¬
forts as are now being put forth
by the automobile manufacturers,
have
we
situation
a
the
mands
utmost
which
de¬
management
skill and judgment on the part of
instalment
credit
institutions
to
keep
trol.
terms
need
I
credit
of
not
under
con¬
emphasize at all
the effect which the current
petitive
mobile
that
through
the
being exerted
are
ever
com¬
battle among the auto¬
manufacturers has on our
industry
pressures
daily
to
broaden the base of available
buyers through unprecedented
car
liberalization of terms. We in this
industry
all
too
painfully
situation
and of the
are
of this
aware
extra efforts which
of
to
us
are
within
keep
One
of
in
the
of
premises
the
instalment
credit
rests
equity, if
his automobile.
month
is
for
equity—
an
please—
spite of the
you
In
got quite a laugh from
legal right of the holder of the
following quip: "The man who
instalment
sales
obligation
in
the
advertising for the most
jurisdictions to follow for a
bank is not the same man who
deficiency, many car buyers con¬
makes the
loan."
It
is
easy
to sider their
liability as being re¬
understand
why this would be lated
only to the automobile which
funny 10 the public when we
they are acquiring and that their
read
some
of
the
come-on
ads
debt can be satisfied at any time
which are used to attract
pros¬
by surrendering possession of the
pective
instalment
this, particular instance, the ad
certainly implies a 4% simple in¬
terest
rate
since
mention
no
is
made of its
being a discount rate.
Another example is: "Auto Pur¬
chase Financing — New Cars As
Low
as
4%.
Used
Cars
tirely different philosophy toward
credit obtained
in
connection
purchase
at the
with
and
retail
an
the
credit
they obtain when sitting
desk
from
an
institution,
store
instalment
which
across
a
officer of
a lending
though
such
even
credit is~in turn used for the
same
Slightly purchase of consumer
goods. It is
Higher." There are undoubtedly
certainly a disservice to the"in¬
some applicants
who can qualify
dividual buyer, to say
nothing of.
for such preferred
rates, but there the
repercussions
against
the
unquestionably
are
many
who automobile
dealer, the financial
must either pay a
higher rate' or
be turned down for credit alto¬ institution, and even the manu¬
facturer, to permit any purchaser
gether. Such advertising, as I see
to acquire ownership of an auto¬
it, can only do harm to the instal¬
mobile with an equity that is in¬
ment sales industry
by planting in
sufficient, to absorb the loss in
the
minds
of
the
thought that they
these very
low rates
experience
case
of
proves
the
purchaser)
poor
public ' the
will
to
(which past
cannot
be
the
instalment
average
and
public
entitled
are
also
relations
lead
when
to
they
actual
resale
value
which
matically
comes
closes the
deal. This is
true in the
case
about
of
auto¬
when
he
especially
new-car
trans¬
actions where the immediate drop
in value is substantial.
Not
his
automobile,
the
heavier real
depreciation which
he must absorb during the early
part
of
his
contract
will
be
greater than his monthly instal¬
in
equity
It
ment.
which
these
repossessions
loss not only to
institution
obligation
be
considered; but the rate of repay¬
can
very well have the effect of ment, which is of course governed
undermining the rate structure of by the length of term of the con¬
the whole industry.
tract, must be such as to maintain
preferential rates to
a
select
few
and
*
The
Major
build
up
Problem—Maintaining purchaser's equity in his
Sound Credit Terms
bile.
Tb£ major problem which faces
our
preferably
industry
today
is
that
of
I
pose
automobile
turers
and
this
automo¬
question
industry,
dealers
the
to
the
manufac¬
alike—"What
manufac¬
and
Of course, we as
stalment
make
keep
continually
trans¬
strive
to
on
a
sound
Fortunately, we
contracts
our
basis.
financial
protected by the
and
demonstrated
willingness of the
great majority of our citizens to
meet their individual obligations
are
in
with
accordance
proven
agreed
terms
—but in times of economic stress,
an
instalment
credit
institution
will
find
not
those
much
wherein
accounts
chaser
does
strength
have
not
the
pur¬
bona
a
in
fide
equity.
Intervention
of
tervention
in
the
between
the
in
tension
control.
devil
If
sea.
policies
in¬
in
and
the
the
deep
judgment of
authority the credit
policies
felt
American
erly
fulfill
to
be
building
industry prop¬
responsibility of
an
vide
that
so
chaser
pur¬
which
structure
rate
a
average
himself; of our
this end, let us estab¬
To
will
facilities only to that se¬
who have a ' high
gear our
lected
group
credit standing.
personal
discretion
and
Let-us
common
sense
advertisements to the
our
public.
sumer
Let
con¬
not under¬
us
mine the rate structure oft the en¬
tire
industry
publicity
by
unwarranted
preferential
on
restricted group
a
rates
of superior
credit risks.
(3) Let
ples
extension.
insist that each
us
has
purchaser
fide
credit
sound
of
Let
strive to continue to
time-tested princi¬
us
the
preserve
in
equity
individual
and
true
a
his
bona
purchase
and
that his schedule of payments will
be
such
as
to
maintain
that
equity. Let
be
us as an industry not
easily stampeded into un¬
too
warranted
vital
relaxation
credit
terms
exerted
sure
dealers
and
through
or
these
of
through
pres¬
manufacturers
by
sell
to
their
of
total
ex¬
industry
the
loose
too
up
there
or
outstanding
in the economy,
event of
thought
an
to
in
emergency, there
be
"indirect
duction
the
or
for
need
a
control"
through
consumer
of
so-
pro¬
control
credit, the
of
government
well step in with regulation
terms and downrpayments. On
the other hand, should we as an
industry be reluctant to
the credit
which
the
ing-public is entitled to
the
manufacturers
feel they
provide
consum¬
or
and
mi^st have to
which
dealers
move
their
merchandise, wje ipay very well
see
agitation
for
government
lending or guaranties of consumer
credit
obligations.
Instalment
credit is such
essential part of
an
the nation's, economy, we must be
of government
intervention.
I
for
control
wary
and
would
one
much dislike seeing our in¬
dustry shackled with government
very
controls
on
confronted
tion
from
agencies.
to
plex
terms
with
and
direct
government
rates
or
competi¬
lending
We certainly should be
manage
and
ment
won't
ing
'
Let
pri¬
merchan¬
and
obtain¬
merchandising
a
thereon.
(4)
in
competition
this rather
technical
any
com¬
business
far
group of govern¬
bureaucrats.
the
is
na¬
noth¬
automobile
business
in
little realism
a
Stock Offered
C.
E.
500
shares
Corp.
of
common
$6.75
Induction
stock at
share.
per
Motors
price of
a
In addition 7,500
shares have been purchased for
investment by American Research
&
Development
Corp.
of Boston,
Mass.
Induction Motors Corp., with its
plant and offices located in West-
bury, Long Island, N. Y., is en¬
gaged in the design, development
and manufacture of precision sub-
fractional
horsepower
motors
of
induction, synchronous and
hysteresis
types.
These
motors
servo,
have
In
wide range, of
a
the
they
airborne
are
used
application.
instrument
field
actuators in elec¬
as
tronic controls, automatic
devices,
fire control instruments and
mechanisms,
and
cameras
well
as
servo
in aircraft
as
guided missiles.
In¬
duction Motors Corp. also supplies
high quality motors for television
disc and tape recording
equipment, fascimile equipment,
timing devices and many other
cameras,
where
uses
precision and quality
required.
are
Giving effect to the current fi¬
of
capitaliza¬
outstanding
the
of
company
127,500 shares of
will consist
stock
common
and 785 shares of preferred stock.
profit
H. E.
honestly
face the
individual
between
in
Induction Motors
..
us
de¬
as
cure.
^interest
lies
all
the
finance
country that
tion
whose
Moseley Opens
(Special to The Financial Ciihonicle)
DENVER, Colo. — Hey ward E.
Moseley has opened offices in the
Kittredge Building to engage in a
.
grantors of instalment credit.
it
do
us
through
service
better
let
to
it
do
us
that
so
we
be
can
passed
and
the
own
continued
integrity
this
of
preserving
those
and
which
..
terms
credit
have
of time.
different from
is
the
bank¬
business — let us recognize
these unique qualities and tread
cautiously before setting a new
ing
is
which
it
makes
mandatory
dividual-detailed attention.
In
size
the
which
an
the
Know
name
with
fact
today
industry
sincere
let
that
we
can
and
me
empha¬
the
challenge
face together as
be met only by
forthright efforts
of each individual grantor to con¬
Drive
under
Mr.
Dunbar
Kenneth
on
East
firm
the
Dunbar & Com¬
of Kirk C.
pany.
was
Ellis
&
formerly
Co.
and
William R. Staats & Co.
R, A. Gorrell
Opens :
(Special to The Financial Chionicle)
.
ASHLAND, Ky.—R. A. Gorrell
Corporation has been formed with
offices
business—run it well.
conclusion,
Hicks
ties business from offices
for
management to give it careful in¬
your
form¬
W.
(Special to The Financial Chlonicle)
Remember
moving business
fast
a
was
J.
SCOTTSDALE, Ariz.—Kirk C.
Dunbar is engaging in a securi¬
pattern of operations.
this
He
with
Krk C. Dunbar Opens
Lincoln
(5) This instalment credit busi¬
ness
associated
Co.
will
industry
policies
the test
&
soundness
through
faced
erly
to the public—
basis which
a
securities business.
which
costs
cut
on
on
a
customers—
improving the
operations
our
can
do it
us
providing
our
by
efficiency of
Let
on
all
this
of
There
with
wrong
instalment
manufacturers
product
needs
consumers.
nancing,
dising their
progress
history and will coptinue
adequately the instal¬
credit
ment
product
exerted
competition
will
same
Unterberg, Towbin Co.,
credit New York
City, are offering 12,-
broad
the
industry
serve
tion's
must pro¬
we
handle this broad market and not
in
its past
no
automobile
the
show
successful
in
automobile
avail
can
service.
lish
the
of
be
can
the
credit
to
goods,
consumer
sufficiently
a
base
of
To do this
case.
our
insure
may
force
of busi¬
system
our
consumption
particularly
dangerous
called
should
providing instalment credit to all
qualified
purchasers thereby
maintaining the essential link be¬
tween mass production and mass
let
is
and
business. If each
own
but that
continue
to
them
this, there
instalment
gree
us
credit
extension
in the con¬
of
by
our
question
Let
the fundamental sound
does
us
ing
(2) Let us as
credit which might be considered
the
is
profit
to
ness.
this
In
industry is some¬
position of being in
our
what
ques¬
of government
and
respect,
is
incentive
The
primary motivating
the
be
to
of
mary,
Control
and
and' credit
terms
the threat
are
nothing
in
fair
a
duct of
ridiculous.
are
aoide
and
With
Government
of
Overshadowing this entire
tion
to
by credit agencies "closely tied in
Threat
lies
of.
are
we
make
is
fair
a
the
in
financial
a
individual
each
will
action
grantors of in¬
with
credit
in
stake
Just
done
be
can
to
This
ashamed
for
better than
sales
profit.
con¬
alike.
turer
instalment
of
all
to
the ^transaction—
dealer,
purchaser,
the financial
-also
but
with
nected
result¬
and
that
business
as
only lead to in¬
can
brought to bear.
it
Remember that
(1)
this
use
creased
ant
low
use
conditions
such
is
able
persistent
actual
the
on
new
a
year,
only
must
the
buyer's
equity at the time he assumes his
A
of
year.
apply for loans and then find out
that they are not entitled to these
rates.
case
15 to 20% in its
and 10 to 15 in its
With this fact alone*
unless the purchaser enters
the
contract with a sufficiently large
second
blue
automobile. Experience has shown
that
many
people have an en¬
the
In
another
year,
third
those
cus¬
the
depending
car,
the
credit
36-
a
that automobile over 36 equal in¬
writes
tomers.
I
have
seen
bank
ads
which read: "Save With Our Low
Bank Rates—As Low as 4%." In
over
is
successfully steer a sound course
through this period? May I offer
these suggestions:
are
we
been
what
be
auto¬
an
in effect
depreciation on
period,
amortizing
frame¬
extension
the
purchaser to have
true cash
financed
is
mobile
when
that
Remember
policies.
fundamental
most
which
on
the
doing to themselves and
industry.
demanded
work of time-tested credit
the
;■
desire of the
American
to
own
an
automobile, particularly
a
new
automobile, with such
fabulous
average
and concerted
seeming to fully realize what they
are
make, of course, the depreciation
amounts to 30 to 40% in its first
—
credit
This
stalments.
centage of the population as pos¬
a
A
principles
such a high
as does the
deliberately
large a per¬
entire
that the rate established by
means
our
have
merchandise
to
which has
degree of popularity
automobile, when you
attempt to qualify as
product
a
employ
you
philosophy of tion selection, all of which are
mass
production, mass distribu¬ contemplated in our basic eco¬
of
tion, and mass consumption of nomic function, the matter
length
of term,
goods is predicated on the basis down-payment,
and credit standing, of the pur¬
of providing the lowest possible
cost to all consumers and not to chaser becomes extremely sensi¬
restrict the market by variations tive and is of critical importance
in price to selected groups. This to the credit grantor. When you
service.
which after two
the customer
balance in excess of the
terms
happening all too frequently
today. Many grantors take a will¬
ing part in such irregular deals—
even
encouraging them without
down
dollar
a
and
a
indi¬
credit
to repay
terms.
We have all heard it said that
reason
of
the
standing
of
recognize
is
there nevertheless
vidual consumer's personal
proper
credit
sound
a
broad
as
maintaining
least
industry in order to cope success¬
with the pressures which
real value of the automobile?"
Automobile Instalment Credit
our
a
the
fully
full years v/ill leave
Today's Challenge to
entrepreneur out of
on
mar¬
attempt to sell cars
on
ket when they
today
their future
Thursday, March 31, 1955
Road,
on
to
harness.
the
Belefonte-Princess
engage
R.
A.
in
a
Gorrell
securities
is Presi¬
dent.
Forms Morgan
And Co.
>
Utah—John
duct the affairs of his own con¬
H. Morgan, Jr., has formed Mor¬
cern
on
a
sound financial basis.
gan and Co. with offices in the
Stop placing the blame on the
Philips Petroleum Building to en¬
other fellow for "forcing" you to
gage in a securities business.
buy paper not as you would like
or
know by experience that you
should. Yes, I have heard it's the
sales finance companies that are
"throwing caution to the winds
SALT LAKE CITY,
Casper Brokerage Officers
SALT
LAKE
CITY,
Utah-
business,"
Henry W. Stead has become presi¬
dent
of
the
Casper
Brokerage
Sound Course
making it impossible for the local
Company, Inc., of Casper, Wyom¬
It very definitely appears to me
that our entire industry has ar¬
rived at a very crucial point to¬
bank and other credit grantors to
in
Points in Steering
day;
ship
are
a
The highest type of leader¬
is
demanded
managing
of
those
who
the affairs of this
their
compete
me
rush
mad
on a
assure
for
sound basis.
you
that
I
But let
have
also
heard and been deluged with spe¬
cific
examples
bank
is
where
the
local
buying automobile
paper
at rates and
on
terms which to say
ing and Salt Lake City. DeWayne
Cr Anderson is Vice-President; Is¬
rael
M.
Snyder, Treasurer; and
Turner,
Frank
Secretary. Salt Lake
City office is in the Continental
Volume
181
Number 5416
Continued
from first
..
The Commercial and Financial Chronicle
.
(1527)
television
As
registered in
really
exaggerated
an
of
and later possibly
the true underlying
was,
manner
sets,
conditions
existing prior to and concurrent with the col¬
lapse of October, 1929.
consumption
what appear to
And there
our
situation
lay elsewhere;
today lie elsewhere.
facets of the current state of affairs which
are
is being
or
sumer
it is not.
are
the
re¬
the 1929
boomlet to divert
OLIN
our
Various favors to them
them
in
war
prior to
1914.
The
Wilson
Includes
with
consonant
following the end of the
country
were
cussions
soon
normal
in
war
peacetime
1918.
Farmers
of
the
eco¬
pursuits where demand
was
The solution of such
not
nearly sated.
so
ixm
n
problem—the undoing of the
mischief war and mistaken public
policies had wrought
—was not and is not
easy. It could hardly be painless. In
any event no effort was made to find and apply any real
conditions
which
times
at
relieved
into
came
power
economic-folly.
times
at
it greatly accelerated the
The
in
some
—
this
a
has
part. It has, however, at most done
no
ous
even
us.
It will not
now
and
applied. Let those who are inclined to grow too ex¬
pansive in their thought of boom times to come bear such
in the late 'Twenties
affairs
now
which had
was
$464,605,000
60,554,000
67,659,000
Per
common
5.41
6.35
'.•?■
share
26,262,000
37,566,000
2.39
3.58
Per common share
!
34,292,000
30,093,000
3.02
2.77
Per common share.
1,010,000.
988,000
-
*
.
'7 9*018,0(10
15,992,000
20,028,000
76,980,000
11,006,365
10,495,599
36,000
33,000
174,794,000
1
146, J 21,000
r.-
at
Number of common stockholders
|
Working Capital at Year-End....
—
III
11)
0
|1
CELLOPHANE
J|f
Iff
of current assets to current
Ratio
^4.2
'liabilities
3.4
i
Plant and Equipment at
"
325,709,000
345,433,000
December 3i
||
619,867,000
Total Assets at December 31
>
562,890,000
|| Employees, Including Overseas,
11
at
36,800
35,600
December 3i
got badly out of hand
found in real estate. The state
existing in that field is in
respects
some
quite different from that which had so much to do with
our post-1929 difficulties. It is nonetheless a situation to
be concerned about. What
the
1953
these in mind.
Another situation
of
RESULTS
<vk<w.v.w.
ameliorated
posed of at prices that cover costs would be, of course,
merely to continue and to aggravate the conditions com¬
plained of. It could do no more at most than to postpone
the evil day when a real solution would have to be found
as
imposts
$470,108,000
||
being paid to our farmers to produce vari¬
things far in excess of any quantity which can be dis¬
facts
certain funds,
CORPORATION
CONSOLIDATED
|| Common Shares Outstanding
HI
'Year-End
WMCHiSnR
agricultural problem is still with
subsidies
OF
ill Total Dividends.
hair of the
a
of
only Domestic and Canadian operations
||| Common Dividends
situation
by a further application
dog that did the biting as is now being
suggested in some quarters. To add several billions to the
of
CHEMICAL
II Preferred Dividends
at
That Farm Problem
or
pledge
!§ Federal and Foreign IncomeTaxl's
■ivivA
country.
This
obliga¬
Deal
than halt for the time
be removed
§f!
|:|
§&;
being a monstrous growth in
malignant tumor which still plagues the economy of
this
boom
HI Net Profit....'....
of this
pace
Eisenhower Administration
appeared to recognize the hazards of such
least
more
general
are
outward
the
instead of better. When the New
worse
bonds
1954
III
symptions but which often- tended to make the underlying
-
any
a
definitely not "good polities." Fnlliatives
preferred
were
The
tions of the Republic of Cuba and,
in addition, are secured by the
and revenues.
|| Pre-Tax Profit
definitely toward unwanted surpluses, to other
was
area.
J Net Sales
in difficulties which had wide reper¬
throughout the length and breadth of the
solution. It
construction work, chiefly on
highways and streets in or near
blin
years
system. Basically, the need was for a transfer of
productive energies from agriculture, where production
.
for
Pro-Forma
nomic
tended
or one
agencies in payment
entry into that conflict in 1917. When
our
not
were
in
way
Republic of Cuba
of its
more
long antedate the out¬
regime had extended
extraordinary need for foodstuffs and other products of
thg farms of the country arose as a result of the conduct
of
this
world
military struggle "inducements" were
readily granted to farmers. They resulted in developments
which
from the
attention.
SUMMARY
really a continuation of the rural state of
emerged after World War I. Farmers have
always been a politically favored element in the Ameri¬
scene.
in this
even
MATHIESON
its way is
affairs which
can
should rule
permit the development of
in
break of
tion Co. which received the bonds
real problems confronting us, and we
are
First of all there is the agricultural situation, which
.
ap¬
revolution in banking
a
Havana.
reason
should be foolish to
depression and the stock market collapse of that
The bonds offered are presently
outstanding and offered on behalf
of Romenpower Electra Construc¬
for several decades. Maybe it is sound; maybe
Certainly
year.
98% and accrued interest.
con¬
kept within reasonable limits. It
banking concepts which has been under
Yes, there
or
condemn
to
Co.,
New York, on
$2,500,000 of Re¬
public of Cuba Veterans, Courts
and Public Works Bonds,
4%, due
1983 (payable in U. S.
dollars) at
extensively "monetized" either di¬
mean
&
March 29 offered
or
this country
sult of foolish
very
credit when
businessmen and, so far
current difficulties
Cuban 4% Bonds
Allen
be trustworthy current reports are to be
more, compared with 1929, this type of
to be part and parcel of
pears
require careful watching — watching not by meddling
politicians whose chief interest is votes but by leading
as
like, and many other items
being acquired in record quanti¬
indirectly. We* do not
ideas and
legislation and unfortunate^ public policy,
by the statesmen among the political powers that be.
These elements of weakness
today, moreover, are not al¬
ways wholly unlike those of the later 'Twenties which
brought on both the depression commonly thought of as
are now
accepted. What is
rectly
The real troubles in that fateful
year
basic weaknesses in
Allen & Co, Offers
ties with small down payments and on terms that run up
to 42 months and even in some instances to four
years if
paper
Troubles Elsewhere
any
"durables," automobiles,
electrical appliances of many varieties,
home modernization and the
We See
the then current situation
credit. All sorts of
consumer
as
page
we
have
construction of individual
credit. It appears
now
is
dwellings
a
on
For
for
a
copy
of the complete annual report
of the Assistant
1954, address the Oilice
Secretary, Olin
Mathieson Chemical Corpo¬
Baltimore 3, Maryland.
ration, 12Light Street,
vast boom in
very
liberal
certain that the degree in which these
mortgages have been "monetized"
was
not dreamed of in
the earlier
period. What is possibly
is the fact
that, thanks to encouragement from Washing¬
ton, the rate at which these liens
even more
are
disturbing
being written and
OLIN
New York,
MATHIESON
N. Y.
•
THE PRICELESS INGREDIENT
Mathieson
industrial
one
Still another facet of the current situation
attention. That is the extent to which
quiring goods by
means
of what has
consumers
come
whit.
requires
are
ac¬
to be known
CHEMICAL CORPORATION
Baltimore, Md.
•
OF EVERY PRODUCT IS THE HONOR AND
and
agricultural chemicals
•
.
East Alton, 111.
INTEGRITY OF ITS MAKER
Squibb pharmaceuticals
•
Super
anti-freezes • Lentheric cosmetics • Olin cellophane and poly¬
ethylene packaging films, industrial explosives, electrical products •
Ecusfa fine specialty
papers
•
Western Brass non-ferrous alloys and fabricated metal parts • Winchester
sporting firearms
-•
Western and Winchester sporting ammunition
•
Frost Golden
Pine and hardwood lumber • Ramset powder-actuated fastening tools • Powell insecticides
Pyro and U.S. I. Permanent
going into the commercial banks is abating not
35
\
CG
(1528)
The Commercial and Financial Chronicle
fjpntinued from first
of Acros, a
page
stoves
Our Invesimsn
heaters.
water
corning to Mexico, Sears has
worked
Slake
hot
closely
very
of
result
a
with
Acros.
close
tins
team¬
work, Acros lias grown from a 40concern to an expanded and
man
still
expanding
TO
employing
firm
men.
Biazil, Cuba, Venezuela, and
Colombia, Sears has encountered
many of tlie samorconciitious, ami
met them.-jiist air successfully, as
vestment banking commu;a:y
j'iok wit a caution an J even ■>, J.
together by the turn
century— more than 500
will
million people.
The combination cf this tremen¬
this
dous
.
,
a
v
Ucism at any new proposal, bli
will try to present facta and
elusions that will interest eve
:i,
n
-
I
v
eou-
t
a
e
doubting Thomases.
thai
twice;
tee
of
demand
ment and
Magnitude of Our Stake in
into
get
take
me
focus
the
economic
our
America,
magnitude
stake
which,
at
arcea
for United
vate
foreign
$8
at
$16.3
billion
billion,
located
was
America.
the
Latin
America
about,
people
think
of
United
operating
in
a
was
have
not
is
to
constantly
a
an
The market
there—ready for him and
grow¬
ing continuously.
Per
America increased 26% from 1945
1953.
It
has
been
increase by almost 50%;
The
mining companies in Chile
Peru, or oil companies in
Venezuela,
fruit
companies
in
Thi.i
picture
sugar
or
com¬
Latin
America
is
certainly understandable. Tra¬
ditionally, Latin America has been
leading supplier of
<»ur
rials
and
tance
foodstuffs.
of
brought
that
this
The
fact
is
when
impor¬
clearly
consider
you
World
War
out
during
mate¬
raw
II
Latin
America
the
crude
the
supplied
75%
of
foodstuffs and 40% of
materials and semi-manufac¬
raw
tured
goods
imported.
which
from
the
In
stockpile list of strategic materials
imported from this
are
However,
the
people will
a
material
raw
area.
Latin
not
economy,
with
nor
raise
their
More and
ing.
better
standards
live
to
liv¬
of them want
more
homes
in,
better
clothes to wear, better food to eat,
better medicine for their children
and families.
It
is
the
for
gives
a
their
,
Latin
better
American
life
countries
which
the
very
£i#tjamic quality which they have
today.
I
believe
who
almost
visitor
every
down to Latin America
goes
back
comes
with
vivid
a
aware¬
of this drive.
ness
It
Capehart
end his mission.
It
true of Dr. Milton Eisen¬
was
hower.
It
true
was
ego
we
of
Vice-President
business
took 35
miciers
on
icsented
They,
actly
U.
S.
assets
four
to
over
men
same
$40
back
came
the
Latin
institutions
of
too,
year
leading U. S. i'in-
visit
a
front—a
American nations. These
total
rep-
with
billion.
with
impression
and
of them have put their
their thoughts into investment ac-
t'on.
one of
these financiers
remarked to me that the
rising
Latin American standard of
living
and
the accelerated pace, of its
industrialization—which
the
trip
—
he
reminded
saw
him
of
looking at
tion
a speeded-up, fast-mo¬
picture of the last 100 years
of our own
and
population of 23 of the
cities in Latin
America
development in North
This
increasing
urbanization
rising living stand¬
with
ards is leading towards the
gence
of
ies
Latin
of
There
emer¬
middle class in the cit¬
a
Of course,
a
major indicator
tourists
who
come
back from Latin America with the
observation
middle
that
is
class—that there
rich and the
very
Gentlemen,
ment
there
and
only
are
very
poor.
dav this state¬
every
becomes less valid.
Apartment
of
America's
population
that
e
of
any
world.
a
year
other
In
the
increase
of
is greater than
major
area
United
of
States
having
in¬
mentioning
tribute
paid
of
Sears
in
to
the
Grace
in
sets,
'•efrigera-ors,
and dish washers.
addition—ani this is a very
nomic and political stability which
in turn
strengthens the basis for
investments.
expanded
contribution
Peruvian
textiles has
been
to
markets
for
long series of
a
'firsts' through the introduction of
textures, finishes, designs, and
new
colors. It
the first in Peru
was
to
make bleached and finished cotton
World
beiore
goocis
indigo-dyed
ized
in
War
1;
pure
instance, when Sears, Roe¬
buck started looking at estimates
cottons
1947;
in
and other
synthetic textiles and their print¬
ing by the silk screen process in
its
Citv,
the
first
of
some
people
cities
seven
has
now
thought
that
potential customers woidd be lim¬
ited to the upper 5 or
10% of the
city's
population.
Actually,
that
oped
represent
now
Sears
has
the
devel¬
fair
cross
upper
spun
rayon
Everglaze cottons and
engraving plant in
and
roller
own
For
those
of
interested
you
in
objective analysis of our poli¬
cies,
our
philosophy,
and
the
growth of our business in Peru,
of
which
typical
are
the economic groups of Mexico
City, and the penetration of Sears'
throughout all income levels
be
can
by
gauged
the
than one-third
credit.
more
Sears
entered
discovered that
problems
small
was
by
works
on
Mexico, it
its princi¬
of
to
teach
requirements
production job.
of its efforts is
the
fact
with
many
the
real
a
success
cut
one
suppliers
doing
The
that
made
over
that
1,300
suppliers
ranging in
two-man
craft
to
more
now
Mexican
size
shop
factory employing
brought
Sears
from
a
modern
a
than 1,000
people.
example
of
our
Scars
originally
mated that
it would
esti¬
merchandise from
of
United
its
States,
it
import about
now
is
tlie
able
to
U. S.
in
in
of what a great com¬
like Sears has been able to
Latin
America
is
the
is
amazing
to
Sao
as
doubled
growth
in
from
Truck
not
case
we
1940
to
1.954
registrations
five
rose
the
ing
did
as
times.
continuously.. One
paint" busi¬
own
our
South
America.
for
Since
the
war,
have found the
we
quality
paint
billion,
or
the
in
in
important
an
in Chile, Peru, Colombia, and
Argentina.
way
The Latin Americans essentially
are
his
one
ourselves.
wife
his
house,
it
her
wants
makes
it
attractive
more
will
do
soon
chemical
experience in
In
the
what
late
has
Grace
out
to
our
bagasse,
business.
developed
we
known
for
process
of
paper
1930s,
become
as
the
import
all
its
the
U.
S.
double
all
kraft
and cardboard
paper,
to
specialty papers, has changed
retailing, merchandising, and
packaging habits of the country.
We developed the initial use in
the
the
country
which
with
of
corrugated
previously
We
had
replaced
multiwall
bags
products.
country
scious
paper
with
the
cotton
bags
in
bag¬
We
and
un¬
the
many
made
package
result
the
con¬
progress
U.
S.
from
47
24
tons
will
paper
plant
to
in
tons
tons
in
ex¬
went
1939
1952—an
In the
in
tons
to
pro¬
increased
941,000
S.
steel
95
production
between
million
At
the
the
in¬
tons
increased
time,
crude
to
1,000,000
tons,
billion
146
to 464
Colombia,
billion
kilo¬
electrical
energy
increased
kilowatt hours to
kilowatt
own
without
With
table
it
end
own
of
ex¬
of
this
our
area.
produced textiles,
paint, cement, flour, vege¬
we
oil, and other basic items.
clear then that
was
the
highest rates of return were
going to be made in the more
specialized and complex manu¬
facturing operations, just
case
in
Thus,
the
if
United
our
and
trially.
that
in
company
was
go¬
develop research and engineer¬
ing know-how comparable to that
required in this country.
many
been
we
These
in
two
have
we
not
identified
Brazil
are
indus¬
and
Ar¬
in
tries
have tremendous faith.
we
In
both
addition,
which
of
have
we
Latin
America
coun¬
the
now on
which
another $15 to $20
stake in that
three
of
we
Latin
our
have
their
20,000
actually stepped
of investment in Latin
while
moving
ing
of
know-how.
into
of U. S. chemicals in
which
a
highly
spe¬
the
man¬
frankly hope will
hemispheric chemi¬
we
a
operation.
Still
Long Way to Go
a*
Although
made
Latin
has
America
tremendous
strides
the
in
postwar period, it has a long way
to go.
The
status
of
Latin
America's
par¬
allel to the United States 50 years
ago.
This
country's
evoansion
stimulated
by
was
Furopean
bankers whose foresightedness and
supplied a large portion
capital that helped develop
courage
of the
the
United
States.
Frankly.
vestment
;
think
I
that
bankers have
floor
ground
of
this
in
do
pioneering
real
a
the
on
ear
of
America .and
icb.
When
consider the fact that invest¬
you
ment
is
Latin
,
tremen¬
a
new
expansion
,
in¬
you
dous opportunity 1o get in
banking
know it here
as we
practically nonexistent ?n Latin
America,
that the door
you can see
is wide open.
Of
course,
States
swer
to
discussion of
any
tim
Question
rate of return the United
investor
arises.
tably
in
investments,
of what
to this
exoect
can
is
There
question
large extent
and
which
no
as
uoon
investment
inevi¬
nat
an¬
it depends
Jbe
type of
with
made.
it
is
However,
American associates—for continu¬
out
our
have
we
America
field
im¬
North
add
to
years.
Thus
the
his
us—as
contributions
will
million
within the next
area
U. S. investor is not
industries
/
America.
including commit¬
which
looked
cialized
the
have
we
Latin
portant local partners. They have
it
•
from what
see
tons,
over
re¬
gentina,
foreign
to
to
has
investments
in
previouslv
is the
as
States.
ing to continue its role of leader¬
ship, we saw that we would have
Moreover, in
Co.
industry.
you
there,
ments
countries
World
anxious
were
in
about
is hard
development
However, it
Latin
invest¬
have invested between $25 and $30
million
842
America
our
the
businesses
At that time
&
will
you
faith
greatly
Latin
naturally
the
from
again
but
discuss
War II, we
paper,
talk
mentioning
perience.
push
to
353 %
hours.
company
to
me
in
heavy
development today is roughly
186
hesitate
has
you
Since the end of World War II
kilowatt
production
million
chemical
think
greatest
or
energy
million
the
Grace
have told
from
by 218 %.
or
I
I
steel
rose
from
watt hours
for
W.
develop into
production in
the U. S. during this same period
In
R.
cal
Brazil
in
Electrical
it
of
some
cently been making in the United
to
by 681%;.
hours,
ment
ner
76%.
by
or
same
tons
in
1952
and
million
54
tons,
production
128,000
1939
from
creased
because
that
investment
and
up our pace
336%?, respectively.
Crude
U.
for
America
to
tons;
in Colombia, from 180,000 tons to
784,000 tons, increases of 2088%
and
siasm
in
Venezuela
43,000
out
me
drawing board industrial projects,
period, cement
same
chlorine,
auxiliaries.
may be wondering if there is any
inconsistency between my enthu¬
in¬
of 96%;.
crease
this
to
3,000
before the year is
reach 30,000 tons.
and
production
million
million
from
bring
American
initial
our
cement
soda,
from
have expanded the
capacity of
of
can
will
monochloro-
textile
that,
an
capacity
period.
be grasped
same
readily by the following
amples:
boxes
been
ging of cement, su^ar, and
other
this
more
paper
naper.
little
a
product will only
gross
in
industrial
but the starting of a local
industry, capable of making
types of paper from wrapping
amounts to
and
company,
which
DDT,
investment of this proj¬
excess of $6 million.
occurred
today Latin America's
almost 2i/2 times the present level.
The Paley Report estimates that
sugar
ments
Latin
mated to increase to $100 billion—
to
require¬
that
seen
$40 billion, by 1975 it is esti¬
over
paper
paper
be-
chemical
Hoechst,
caustic
is in
States
waste
fibre. Prior to this, Peru had
billion, also measured
prices, or by 17%.
product
making
or
bil¬
productivity
in
the
period is growing at a
Whereas
gross
I
similar
$263
expand¬
in Latin
of this is
joint venture with the lead¬
benzene,
I
the
in
example
German
ect
es¬
chemical project in Bra¬
manufacture
same
are
industry
An
new
a
ing
gross
States.
our
a
this
States'
faster rate than that of the United
likewise.
In Peru, we have had
In
from
America's
looking, his competitor down the
street
52%.
may
postwar
to
paint his. In business,
storekeeper paints his store
one
and
like
paints
man
neighbor's
husband
if
much
very
Once
constant
Thus,
billion to $41.6
United
lion to $307
greatly
so
by
Latin
the
already
but we
our
better position to broaden
a
America.
zil,
our
Not
'
accelerate
now
activities,
Farbwerke
period,
increased
product
mar¬
expanded lhaLtoday we are in the
business
postwar
industries.
of
we
po¬
in
progress
participation
our
than
our
bus
and
farms
tablished
Latin
more
tripled and the number of tractors
In
acquired,
strengthened our
future
can
also in
for
use
whole
a
decision, in
research and spe¬
new
American
only
Paulo.
automobiles.
on
for
Latin
in
is
chemical
are
this
knowledge
development
This
to this NPA
you
we had
paint plant in operation
one
however,
ket
American
we
styles and standards.
Typical
pany
do
Latin
Just before the war,
ness.
only
known.
\vhereas
sition
by
56%
to
compared
of
year.
have greatly
duction
is growing
cane
When
pal
fact
are
other
in
countries, I refer
cd'
sa7es
cialized
for
Chicago.
This
an
50%
a
times
11
in Sao Paulo increased
use
270%
early 1954."
in Mex¬
Mexico in which Sears
to
a
With the
22
Also, the number of telephones
in
denim
in
1927;
1936; mercer¬
cloth in 1942; combed cottons
paint
For
power
increased
Chicago.
period,
Peru."
Grace's
ket
washing
buying
compared
million
passing
passengers
Paulo
solvents,
machines
ico
airplane
through Sao
turn,
industries.
The total
Our company is evidence of the
fact that the Latin American mar¬
in
of
food products
sugar,
placed
$130 million in the II. S. chemical
industry and our annual research
expenditures amount to over $3
in¬
period, the number
same
textiles,-
—
the last lev/ years we have
12%.
the
3
closest to
was
industries
result
a
creased from $27.3
in Latin American cities. A
greater
market is developing for
television
As
America's gross product — meas¬
ured in constant prices—has in¬
report.
cf effective
In
population
this field
as
own
paper, paint,
—which,
in
leading
transportation
and
Chicago's
creased
American
ban developments, heretofore un¬
known, are new the coming thing
racics,
our
field, I might be
permitted to quote briefly on one
phase of our operations from the
all
and
dustry
be¬
Sao
process
America
affairs
r,i
97%.
limited
subur¬
bouses
growtn
Between 1940 and 1953 the pop¬
ulation
of Sao
Paulo
increased
However, I do
company.
that,
Latin
is
Chicago—two
industrial
is,
somewhat
course,
contributions
the
no
op area's vitality is its birth rate. buy in Mexico 80% cf what it sells
AfTeheve you all know thai Latin there, most of which conforms to
about 2V2%
con¬
America
this talk in
in
own
1948;
America.
are
"0%
America.
hibited
printed
area.
coupled
of
Recently
1940
45% compared to 25% for the
rom
entire
ex¬
some
oh
between
section of at least the
the
the
almost twice
the total population.
customers
Nixon.
On
the
stores,
true of Senator
was
1950
Latin
growing
as
example,
largest
in
cities and
and powerful
development of a middle class
aspirations—on is bound to produce
greater eco¬
these
of
part
people
great
is
of the
one
has been his
population
move¬
Latin
feel, of
"Casa
important point to bear in mind—
this
drive—it
the
For
with
of
know,
success
to
in
"Casa
markets
in the
are
are
rapidly
"'s
American
its corollary, a
one-crop economy.
They want to produce goods which
will
major
America
the
satisfied
be
open
Planning
Association's
report, published just last fall, on
Major Latin-American
The
country
our
addition, approxi¬
mately 30 of the 77 items en our
t'
Paulo
of
of
scene
recent
Telephones
Markets
cities
of
in
The "Casa Grace"
our
nature
National
projected to
present level by the mid-1970s.
of
America,
panies in Cuba.
to
ments and birth rates and his
l'eel
capita consumption in Latin
ond
Central
marketing
attention
I
technical
field
-in
the T United'
States. We chose the chemical in¬
comparison
dynamic
American
an
general
our
the
limes
As most of you
growing
Latin America, they usually think
VMst
scheduled
Lima, Peru,
fall.
worry
to
tween
business in Latin
new
did
market for his goods.
to
companies
day that'one thing
investor in
which
in
other
the
Latin
the
same
a
store
new
therefore, most significant.
-
When
Ltates
of
I know in
its
of
the
end of 1953 such investment abroad
stood
a
true
of
pri¬
At
ready-made market. It
a
be
fidence
least
States direct
investment.
self-improve¬
it did in Mexico.
leading U. S. businessman to state
1897, has been the most important
.
for
in
to
Latin
in
since
.States
this condition that prompted
is
moment
a
United
exploding population
an
provides
Latin America
First, let
the
of
nd Canada
e
back
interesting
showing
secrets of General Wood's amazing
»
,
Getting
topic, an
centers.
iir.d.SVQ million to in vert pp. " v/ '.-re' 1c. h»c re"isc i
only a!,ou t 1 \:t %.
giving Latin America seriou,, can- h lur been estimated that, should
^deration, ,:;vn
/ ■ V. V - n
■presept rates, cohll-the popu¬
1 fully approciate that t';s<(:'■ hH lation of Lathi America
may be
Thursday, March 31, 1955
..
Recent Economic Growth
Mexican firm making
and
Since
.
capital
he
a
all
we
in
^n
a
wisdom
that
know
a
going to place
foreign
reasonablv
country
expect
higher rate of return than that
obtainable at home.
Such
a
situa-
/
; <
Volume
tion
is
131
Number 5416
not
Capital
new.
sought the
ways
return.
This
The Commercial and Financial Chronicle
.
.
has al¬
of highest
areas
reflects
.
the
large demand for new cap¬
ital—but a limited supply of their
a
own—offer
countries
higher return
a
rich
the United
in
capital
States
than
such
as
today.
That this condition exists clearly
shows up in the price one has to
for
pay
in
commercial
Latin
foreign assets.
age-old
economic law that those countries
with
(2) The danger of expropriation
of
bank
(3)
America
Present
rates
commercial
certain
of
bank
countries
interest
countries in which he proposes
to invest.
In
the
second
in
In
to
range
Uruguay
the
8V2-9V2
Compared to the present prime"
commercial
the
bank
United
rate
States,
-
of
you
3%
in
"see
can
that credit is from about three^to
four
times
America.
expensive
as
in
Latin
■
for the
is
simple
much
that business
reason
he
of
There
controls
under
goods,
standard of
developed
where
lated
growing demand
a
reflecting
the
rising
living.-jOnly in highly
industrial
capital
over
has
nations,
been
accumu¬
considerable, jieriod
a
long-
lie would in
as
which
full
a
and
now
in
no
operating
free
and
are
economy.
periods,
as there are
when earnings and
countries
some
Latin
exchange
there have been in the
as
reserves
be
cannot
There
is
no
or
to
reason
conditions
even
consider
perma¬
transi¬
tory,
and
the
return
on
ment
can
and
should
more
offset
the
accumulated
ings
invest¬
than
the transitory
inability to
earnings. In the meantime
remit
currency
earn¬
be plowed back into the
can
capital markets exist, are profit
margins low and still decreasing.
I
in
gins
due
this
to
the
inflated
for
return
on
net worth has
in
the
to
10.5%
and
in
United
I
high,
—our
for
in
frum
1950
the
United
of
rate
in
States
dustries
have
indicate
in
return
1954
and
to 9.8%
seen
know,
many
mature in¬
more
lower
even
the
might drop
to below 10%. As you
of the older
1953,
Preliminary
figures which I have
that
13.4%
and
14%
period.
same
profit
margins than these averages would
indicate.
These
exist
same
in
industries
America,
there
infancy.
World
-conditions
Latin
the
increasing
do
as
still
are
Although
has
the
not
many
in
their
" Western
ability to produce
amounts
of
developing in the world markets.
In view of this situation, I expect
profit margins in the
countries
further,
Latin
while
maintained
in
to
still
margins
should
view of
expanding markets.
in
well
be
its rapidly
Herein, Gen¬
the future of invest¬
lies
tlemen,
shrink
profit
America
indus¬
more
Today
are
Latin
in
signs
many
ment
is
terest
taking
in
America
of
the
Our
govern¬
increasing in¬
economic well-being
an
of this area—and for good
cal
o
there
improving
an
climate.
investment
practi¬
recently,
and
Peru
Costa
Ptica have joined our country's in¬
vestment
guaranty program. Cuba
negotiating a tax treaty with
is
the United
gentina
are
easing their laws with
have
enlarged,
many
of
you
perhaps will say with undue en¬
thusiasm, on the opportunities for
in
investment
countries.
I
them, but I
ful
of
the
vesting
usual
in
am
am
American
Latin
enthusiastic about
not at all unmind¬
arguments
those
against in¬
countries.
objections which
one
The
hears
period
lar
of
foot
has
and
Risk
of
inconvertibility of
currency.
operate
we
quence
well.
We
hope to
tion.
The
see many
philosophy of
operation
by
his
opening
this
President
Orleans
the
to
message
New
.
all
behind
.
private
plans
projects, behind Government
help, behind a New Orleans Con¬
ference
or
the
hind
the
K10
a
Coineience,
the
words,
dollars, and
blueprints—there
all
American
tries
lost
nor
dol¬
a
a
square
through
land
expro¬
Latin
American
in
Latin
American
coun¬
political stability in
degree comparable with that
have
we
known
in
t;his
country.
call
Again, however, I rrpist
the experience of our firm
on
authority for the statement that
changing political conditions in
as
of the Latin American
any
tries—unless
Red—can
they
only
thought
one
to
leave
it is the thought of
American
Latin
faith
in
be-lived
with
out—it
do
by
un¬
few simple
a
STAY OUT.
means
this,
Using
will
you
the
If
for
be
If you
able
to
get
power.
(b)
Latin
of
field
American
practical
wherever
and
id
this
keefJ
feasible, and
too.
of polities,
out
(c) Have
your
the
Americans
in
management, closely identify
themselves with local community
American
man
on
delivers
still
goes
eign
is
investor
rigid
principles,
in
ence
highly
been
mail
pretty much
and
Latin
faith in
America
to
grow
has
been
we
and
have
with
panding economy of this
the
ex¬
Since
1940,
we
production
pared
textile
to only
of
a
production
We
Debentures Placed
New
The
has
Household
placed
Finance
Corp.
privately
$25,000,000
sinking fund
4lk%
(Canadian)
4.08
Exchange-
J.
increased
shares
■./
19.14
.,i
32.13-
U
__
Trust——
11.92:-'
—
Morgan & Co.
*New
12.62
_r.__
P.
National
.
1.82
Trusty
stocks,-
Bank
Manufacturers
-'
19.51
National—
r
16.00
City
York
Public
3.46
Trust—,
13.79
-.
National
___
•
14.76
—
■"•if
Adjusted lor recent two-for-one splits.
These
1954
respective
operating
amounts
earnings,
of
Earnings
of
the
to
stock
1954
and this is followed
Invested
on
Assets;
then
applied
book
by these ratios:
Value;
Book
on
are
year-end
Dividend
and
Price: Earn-
per
of
Dollar
1954
Invest.
Rate Earn,
Div;
Assets
on
Book
Invest.
Earns.
Book
Invest.
per $
Payout
Value:
Assets
Ratio
Value
Assets
of Price
Ratio
Trust——
$74.77
$9,047
14.4
7.4%
0.83%
Manhattan
60.12
733
9,225
17.8
8.2
0.65
8.59
66
67.81
982
9,576
13.2
6.9
0.71
10.60
54
69.80
890
9,948
14.5
7.8
0.70
9.83
52
68.09
859
10,165
15.1
7.9
0.67
9.84
57
43.92
869
3,465
18.2
5.1
1.27
4.40
95
54.27
1.011
6,398
17.6
5.4
0.85
6.67
86
71.68
1,068
9,551
14.4
6.7
0.75
9.25
53
57.83
7.98
7,679
16.8
7.2
0.75
7.91
Tr._
69.99
895
10,227
13.8
7.8
0.69
10.56
54
Co.
55.39
823
7,456
17.0
6.7
0.74
7.92
62
54.08
926
8,128
17.4
5.8
0.66
8.62
71
Trust-—
64.54
879
7,102
15.0
7.3
0.91
7.36
64,
53.45
743
7,188
16.2
7.2
0.74
8.29
62
Bank
New
of
Chase
York
National
First
—
Corn
National
Guaranty
Trust
J.
institutional
purchas¬
P. Morgan
National
New
The
will
proceeds
fund
Finance
parent
company
sidiary short term
both
the
ada
and
be
United
to
used
Corp.
1954
sub¬
and
Higginson Corp. and A. E.
Ltd. acted as agents in
Bankers
of
New
Chase
negotiating the placement.
Chemical
Lonergan and John D. Mathewson,
Jr.
are
affiliated
now
vestors
with
In¬
Corporation
Planning
of
Pennsylvania, 417 Grant Street.
M.
H.
to
Bishop
Bank
western
Jos. McManus
&
Co.,
Building
North¬
have a
City.
B.
Hogan
Calif.—John
H.
Grobaty, Jr. and Richard D. Har¬
have
Arthur B.
wood
become
8
2
32
8
13
6
12
1
11
7
7
65
6
4
4
1
7
6
1
3
7
3
4
3
7
4
1
33
5
10
2
6
2
9
3
4
4 i if
Score
32
14
14
13
11
1
14
11
2
13
11
10
3
13
10
73
2
■_
9
11
1
5
3
8
4
5
2
30
37
•'<
12
9
8
6
4
11
9
3
6
1
2
3
8
2
3
28
10
11
10
9
8
5
10
5
72
_
Trust™
7
is
5
apparent
more
8
10
9
10
6
8
68
12
5
5
2
12
6
57,
14
11
7
5
9
5
'
13
National
in
Bank
6
comparison
this
low ratings than
Bankers and
68
8
12
City
York
Public
_
any
of New
that
70
Manufacturers
com¬
increase
the
in
United
our
paper
of the other stocks, with Hanover,
York
as
runners-up.
First National's
position at the opposite end of the reckoning has been influenced
by the rise in the price of the stock since the announcement that
City
National
be
will
share.
a
off
pay
the
Nevertheless,
at
First shareholder at
the
prevailing
price
the
rate
of
just before
City announcement, First National's position would
The stock
unchanged.
has for
some
time shown
and
a
very
a
relatively
It does, however, have a
high dividend pay-out ratio.
high rate of earnings
invested assets,
on
a
reflection of its strong
capital-funds position.
Boulevard, members of the
With J. B.
Exchange.
Hanauer Co.
New
(Special to The Financial Chronicle)
BEVERLY
ward
(Special to The Financial Chronicle)
Calif.—Raymond
FRESNO,
Standow
has
with
&
Hall
become
the
W.
Nickel
HILLS,
has
staff of J.
140 South
B.
Calif.—Ed¬
been
added
Hanauer
&
Study
on
Christiana
to
Co.,
Securities Co.
Beverly Drive.
connected
Bulletin
Hall, Bank of Amer¬
on
Request
Daniel Reeves Adds
Building.
Best
Inv.
Co. Formed
FRESNO, Calif.—Best Invest¬
Company is engaging in a
production 8'/2 times, compared to
Laird, Bissell & Meeds
LOS
W.
ANGELES, Calif.—George
Gregory has become affiliated
with
Daniel
Reeves
Palm
gian is
a
Avenue.
Zadig
Zadi-
principal of the firm.
South Beverly
&
the
New
York
Co.,
398
Drive, members of
and
Stock Exchanges.
Los
Members
New
York
Stock Exchange
Members
American
Stock Exchange
120
ment
1577
•
Trust
with
connected
Hogan, Inc., 4757 Holly¬
Los Angeles Stock
ica
Ratio
high ratio of price to earnings, a low earnings rate on book value,
(Special to The Financial Chronicle)
ris
4
9
National
the
Two With A.
4
—
Trust—
$550
York
3
4
Bank
Co.
New
7
Trust—
National
in
3
Price
Morgan & Co.
P.
has
Bishop & Co.
1
__
Manufacturers
It
Wire
Assets
Tr.
Irving
New
Invest.
Book
York
National
Hanover
J.
on
Ratio
Corn—_
Guaranty
J.
Payout
Earns.
Assets
National
First
PITTSBURGH, Pa.—William
Dividend
$ of
Invest.
Value
Manhattan
of
Bk.
Trust
Ames Co.,
Planning
Per
Book
Earns.
,
Bk.
With Investors
Assets
on
1954
Can¬
additional
provide
72
Invest.
Earn,
Earned
12/31/54 12/31/54 Price
53%
12/31/54
Rate
Rate
12/31/54
borrowings in
States
$8.37
1954
re¬
working capital.
Lee
National
$1,009
by
to
and
&
City
York
Public
Household
_
Bank
Hanover
Irving
_
Trust
ber
Canadian
*
Pay-Out; Rate
Assets
Invested
the
to
values
Market Price.
Manufacturers
1975, with a num¬
leading United States and
of
"
This list follows:
Irving Trust
lli.58
Corn
Guaranty
*
York-^
National
Chemical
securities business from offices at
have
various
number of
Bankers
doubled
textiles,
in
the
the
area.
have
47%
of
of
"Hanover
(Special to The Financial Chronicle)
our
•.
be merged
t Shares
1G.36
20.73
Earnings
Joins Hall & Hall
company's experi¬
com¬
Bank of
these
of
market
other factors
12-31-54
Household Finance
concerned.
successful
able
as
prices
$1,000 investment will give.
a
Manhattan
of
First
the for¬
observation
our
life
usual
as
the foreigner and
as
present
-Dec. 31, 1954
HOLLYWOOD,
still directs traffic, the post¬
cop
far
they live.
during most Latin
revolutions, the traffic
know,
stocks'
are
study will probably
made/a calculation
1954
life and become part of the coun¬
tries in which
this
in
Trust
of
'■Bank
Our
particularly
your
the
Shares
Bank
direcPwire to Joseph McManus &
management, and
to
There
Price-
M. H.
nationals
ing
been
invested assets;
invest¬
on
reported
attempt to bring in the tangible
an
banks
ings; Rate of Earnings
the
ment, it is that word "faith."
Employ as the managers of
business able and outstandip
your
the
repre¬
anything
Trust
reasonably thorough comparative analysis is
a
in
I
which
company
stands
earnings
facet that is helpful.
approximately
Bankers
along with whatever government
is in
of
of each stock that
America—economically, cul¬
turally, politically and spiritually."
sent
Bankers
of
Donovan, Jr., Cyril J. Ivory, Paul
Stay out of local politics—
doesn't mean stay partially
this
if
there has first
with
future
1954
included here for their contribution to the analysis.
are
North
our
the
in
shortly with others (Manhattan, First National, Public), but they
choose
to
taken
conse¬
■
Chase
I had
today
that
relating
even
one
This, then, is
Several
Chemical
if
basis data
ponents.
Latin
coun¬
completely
go
swerving loyalty to
principles:
(a)
be compared
to be made.
North America.
invest¬
that the political history
the
which
And
debentures due
reflects
any
to
America, and Latin American faita
in
*
to say
all
$53.69.
prices gives only
of faith—•
faith
that
ment, that is, disturbed political
conditions, it would be foolish for
of
and
exist
must
the essential ingredient
North
uc-
comparative
a
For example, it is not of much
show
we
when he said:
ers.
me
help if
or
on
operating earnings of $4.57, compared with those of Cr.ase of $4.21;
or
that.the respective book values at Dec. 31, 1954 were
$61.64
Conference
Investment
reveal little.
may
co¬
brilliantly summed
Eisenhower in
was
up
more
With respect to the third objec¬
to
by itself
Bank Stocks
—
analyzing bank stocks
all
priation.
tion
In
as
busi¬
for
over
never
money
our
doing
America
have
our
of
been
years
we
and
States.
are:
(1)
100
By
to foreign investment.
regard
I
Brazil and Ar¬
States.
believe, to the Latin American
countries in which
This Week
only
like
we
expropriation,
"bugaboo" is a
the subject is this
on
By ARTHUR B. WALLACEi
we
Latin America.
to
this
South
You
reasons.
Just
than
them
ing in Latin America!
say
firm
in
ness
goods,
keener competitive conditions are
trialized
shall
already declined
Canada from
the
industries
all
States
between
that
ghost that should be laid
mar¬
demard
not
but,
growth has been built
respect
feel
were
goods generated by war scares, has
not changed the basic long-term
trend
of a
declining return on
capital in the United States. The
average
With
profit
years
country
benefits
great
stockholders
our
to
you,
are
than
more
business.
ing the last few
brought
to
"And
.
of time, and where well organized
The fact that several times dur¬
operation,
re¬
mitted.
that rsuch
ral outcome of
per¬
develop¬
countries
and
nent,
the natu¬
a
apply
and
America which have
A.merica than in the United States.
for
would
a
are
High profit margins
are
of
century
a
".
profitable in Latin
more
to
and
in
borrowings
In
domestic enterprise.
past,
bank
should
as
which he would build
policies, just
case
Bank and Insurance Stocks
in¬
have built enterprises which have
Bearing these precepts in mind,
est
on
he
I don't think he has much to fear.
ica is able to pay such high inter¬
charges
expert
plowed-back profits and
There will be
The businessman in Latin Amer¬
place,
management
ment
9V2
has
compared
with local and United States capi¬
tal working in friendly coopera¬
which
9-10
8-10
times,
third
with
Venezuela
IIV2
with experience in that
the
Peru
Mexico
with
consider his investment
up
9-12%
United
other en¬
terprises created in Latin America
manent one,
are:
Brazil
place, he should
associated
field.
for
borrowing
in
carefully
analyze conditions in the country
managers
Latin-American Interest Rates
investor
should
or
become
the
production
paint
creased
place, I believe
prospective
any
for
only 64% increase for the U. S.
Now in the first
that
Latin
times
1.8
Our
condi¬
control.
no
credit
America.
political
which the investor has
over
only
States.
Disturbed
tions
Si
(1529)
Angeles
BROADWAY, NEW
Telephone:
Bell
YORK 5, N. Y.
BArclay 7-3500
Teletype—NY
1-1248-49
(L. A. Gibbs, Manager Trading Dept.)
Specialists in Bank Stocks
^
>
' 38
(1530)
The Commercial and Financial
Chronicle
Continued
jrom
9
page
ply of stocks. Corporations in re¬
cent years have been solicitous of
their executives. They've granted
stock options rather freely.
U. S.
Steel,
From Boom to Doom?
loans
on
for
not
securities
on
the
which
of buying or
Stock Exchange attributed
the rise in stock prices—in part,
at least—to the shortage of stocks.
bank
will
lend up to 75% and perhaps more
—in contrast to the 40% limit on
loans.
purpose
One
other
change ought to be
Regulation U applies only
made.
to
securities
stock
traded
exchanges.
lend
75%
A
if
more
or
registered
bank
can
on
it
wants
over-the-counter stocks.
on
is
grave defect.
a
traded
registered
on
much
bian
exchanges
over-the-counter
Yet
than
much
are
I'd
active
more
markets
securities.
permit banks to lend less
we
them
on
Here
also
securities which
on
less
liquid.
make
loans —to
if
tyank exchecks
spot
see
borrowers
of
are
diverting
business
credit
into
speculative channels. Such checks
would
make
banks
more
wary.
I'd
like
to
suggest also that
Teresa
Congress rjass legislation rcciuirpass legislation requir¬
ing companies whose Stocks are
traded
the
over-the-counter
to
com-
were
surmised
that
executives
and
think
j
this
1955
and
will
that
in
been
of
to
to
cash
of
some
so
not
as
eggs—their
—
in
U.
have all
to
jobs
S.
and
Steel's
M.
G.
shares.
this
0f
sold
Soup
the first
bell
stock.
up
some
Dor-
$50,000,000
Co.
stock.
The
Ford
Stocks
have
it
reached
pays
a
point at
corporation,
a
or
Jones
&
It
necciect
doesn t
some
make
oy
sense
corporations
to
mvcsiujb.
to
perm-
avoid
(1)
registering with the Securities &
Exchange Commission, (2) making
repoiis,
SEG
proxy
their
cause
(3)
confoiming to
just be-
regulations
stocks
unlisted,
are
Nor should
their officers, as they
be exempt from the insider-trading rule.
are
now,
u.
companies, then they would probably list their stocks on an exchange.
Their stockholders would
have
the
than
"assembled"
benefit
of
real
rather
quotations
for
their securities.
lVow
to
these plans have
single purpose
a
to make it possible for executives
to acquire a comfortable
nest-egg.
When
prices
are
right,
these
stocks will be
cashed—distributed.
Each advance in the
market tends
to assure new sales of
stock
bteei, commentea inai sicci
shares were selling - well
below
the
real
hind
worth
Funston,
subject.
President
of
the
Keith
New
book
value.
corporation
to
diluting
assets
At
that
could
raise
the
price,
float
its
the
common
capital
equity
S.
above
without
of
shareholders.
existing
<
also
complained
that
they couldn't afford to sell stock
because the market value
book
value.
was
be-
In
October,
sold $131,-
National City
Bank
250,000 of stock to its sharehold-
such
j
want
are
sup-
I
have
phases
*
Stock prices lagged behind
earnings:
—
until mid-1949, then shot
distribution
a
to
comment
irnpreSsion
That
is
that
market is
in
0n
of
this
Then
between
These charts help to explain the
of the stock market since
depression. From the 1932-33
lows, stocks advanced with indus¬
trial activity and
earnings.
Then came the 1937 industrial
rumblings
of
levels of
Naturally,
a
when
though
quadrupled
Why?
and
the
1937.
1950.
a
postwar set¬
collapse didn't
1949
recession
prized.
When
industry
weathered
the
recession of
1953-54, confidence in
earnings—in stability—rose anew.
The
market
pried
of
shares
1949,
early
in¬
dollar
one
of
war.
earning power sold for less
than $6; today, one dollar of earn¬
ing power sells for $13.
14
page
may
Depression in the Textile
Industry and the Way Out
corn-
Street
activity in the stock
with stahil—
dedsWeTy if
bread
not
and
"areas
of
that
gin buying. I see no reason
why
persons should be able to borrow
on securities without a repayment
date.
of stock
market
loans
demand loans. Actually, they're
semi-permanent loans, payable
as
the
400
borrower's
surplus"
textile
There
o
250 2
<o
200 0
generates
selling.
Activity then
synonymous with instability —
is
on
Loans
securities
on
made
—
should
be
repayable at
a
stated time. The borrower should
be required to set
up
schedule
a
of payments which is feasible.
Re¬
payment should not depend
sale of stocks. That would
the
market.
1935*36*37'38'39'40'41 '42'43'44'45'46'47 '46'49'50'5I '52
53'54
Source: Standard a Poor's
J.A.
market
true
a
on
the
make
capital
Of course, you could not
a
stock purchaser from
prevent
borrowing and then selling to
Livingston
off
his
debt.
But
pay
would
lenders
quickly get wise to that type of
BAROMETER OF CONFIDENCE
operation. And proper regulations
by the Federal Reserve could put
30
The cost of *1 of
earnings has risen to
J13 from J6 in 1949.
stock
stop to it. I'd exempt from this
investment dealers* brokers,
professional traders, and specu¬
a
30
rule
lators, who make their living in
the
securities
loans
on
markets.
stocks would
ventory loans to
a
To
them,
be like in¬
thafh six
the
£
change the capital
gains tax. This tax, as presently
constituted, is really a transaction
tax. By holding a stock for six
months
pays
a
or
more,
maximum
the
of
taxpayer
25%
on
his
ties
months
term,
a
a
security
doesn't constitute
capital,
for
a
six
long-
commitment.
A
doesn't buy a home every
months, or purchase a new
person
six
°.ll 1 iJ'l!'11'37
nil111' t11,"1 t|H' V' 1-1,11111111m 1111 111 11 m f 111111111 n I n 111111111 tr>
1935 36
42 43 44 45 46 47 48 49
50 51
~
52 53 54
J.A.Livingston
factory
are
every
six
months.
transactions that
capital
transactions.
we
I'd
Those
consider
be
textile
but
labor
have
the
areas
with
e.,
less than
force
The
in
favor of raising the rate of tax on
short-term transactions. To
pro-
Nor
unemployed.
prepared
for
this
industrial de¬
new
The people have a
investment of skills in
industry.
of
textile
states along
the Atlantic seaboard makes
these
areas
peculiarly dependent upon
industry. The proportion of
the
manufacturing
accounted
for
in
is
North
and
than
more
and
employment
the textile in¬
by
of
excess
50%
in
Carolina and
South
25%
in
Rhode
Island
Georgia. In addition, substan¬
tial
proportions
of
the
employment in New
Maine, Massachusetts,
Vermont,
Pennsylvania, New
Connecticut,
Jersey,
Virginia,
Tennessee
textile
factory
Hampshire,
are
Alabama
provided
and
by
the
industry.
The
inability of these com¬
munities to get out of this chronic
state
is
attested
by
because
The
in
ployment
had
an
and
unem¬
rate of 6.16% in Febru¬
in September
1951
ary
Massachusetts
Lowell
and
1954,
Lawrence
had
an
unem¬
ployment rate of 10.8% in Febru¬
ary 1951 and its September 1954
rate
the
is
23.5%.
rate
12.0%;
3.6%
Fall
Bedford
2.9% to
River from
12.3%.
this
suggested
people
Lowell
from
in
and
to
New
risen
has
In
the
fact
means
that
is
100
were
were
with
unemployed
only
unemployment
Bedford
with
them
since
they
of
such
is
most
shift
areas.
hidden
un¬
depressing
the
burden
of
support to the relatives and fami¬
lies and thereby
weigh
heavily
them with unfortunate
upon
sequences
their
on
and
the
con¬
standard
children's
of
oppor¬
tunities.
The
has
shrinkage
been
factors.
in
produced
First
employment
by two major
has
been
the
mill
closings and the other is the im¬
pressive
rise
in
man-hour
pro¬
ductivity within the industry. The
closings,
of
course,
have
practically completely shut out
mill
new
employment
opportunities
for the affected
person.
of
textile
mill
A survey
closings reveals
during the period from 1946
through 1954, 640 eastern, plants
were
closed
employing 168,000
that
persons in the
major textile divi¬
of
(exclusive
very
small
plants). The distribution was as
sions
shown in Table III.
Many
of
these
in
where
plants
isolated
are
lo¬
communities
other
opportunities
This is reflected in the fact
no
that for the year
ending June 30,
1954, almost 100,000 New England
workers, unable to find jobs dur¬
ing the period covered by unem¬
ployment
compensation, ex¬
hausted
It is
their
also
proportion
insurance
benefits.
apparent that
of
those
unemployment
a
found
survey
as
been
large
in
the
having
unemployed in excess of 26
weeks, who in December 1954
6,070
in
Law¬
receiving
benefits; New
8,350
cluded
5,200
unemployed in
with
only
3,613
being
paid unemployment
benefits; 12,rence
can¬
.
market
numbered
actually
by
been
prevents
age
effects
employment
exist.
that
particularly
labor
unemployed living in these
cated
those
their
il¬
many
finding jobs and they are
no
longer considered eligible for
employment in the vast pools of
they have remained distressed for
long periods of time.
We have
kept records of such communities
as
and
have
the
fully
since
from
the fact that
find
figures
problem
women,
out
of
,
living
corx-entration
these
the
persons,
celled
manufacturing in the
total
do
lustrate
12%
These communir
not
with
textile
What
profit.
Holding
unemployed).
20
(See Table II.)
10.2%;
business.
I would also
y)
more
(including seven major communi¬
ties)
in
the
"substantial
labor
dustry
the downside.
amortized
or
surplus" classification, i.
ask
may
more collateral of a
reduction
in the loan. That
puts pressure on
the market at a time when it can
least sustain pressure. It
forced
12%
force
also
are
more
beneficiaries.
older
labor
life-time
happen to
decline, then the lender
Em¬
velopments.
Activity and Instability
higher.
of
7,200 unemployed
unemployment insur¬
6,189
ance
classified in this
are
(having
situation
If the market should
Bureau
labor
older
areas
the
substantial
Fall River with
had
Security, are textile
addition, four smaller
category
of
United
designated
the
oy
In
areas.
are
very
ployment
of
1 350
continental
which
terested
talk
the
States
like
necessarily good for society.
reason, I would be in¬
in reducing stock market
transactions that depend on marFor
in
areas
activity,
butter. But it
brokers
a
the
even
share
1946
creased. In
When Hitler's German
troops be¬
gan overrunning
Europe, stocks
jrom
was
both
proved mild, stocks began to rise.
Earnings
became
more
highly
CHARTS
course
and
year
halt,
a
Because of fear of
back. But when the
come,
FOR
the
came
earnings./per
the answers. But I will be
respon¬
decline
that
and the stock market.
Shortly
the end of the
war, prices
approached
sive.
lor
few
a
complex subject.
may
have some
BACKGROUND
of
turning point in
after
only
on
questions. If so, I'd better say un¬
equivocally that I don't know all
phase
Wall
svnonvmous
™^
——
Source: Standard 6 Poor's
*
touched
The "committee
l°ss—and retires the debt.
—-——
38 39 40 41
November
a
major
option. When
the borrower gets tired of
holding
a
stock, he sells—at a profit or
80
7
options. We
mon
We
Executives, themselves,
likely to become a source of
WALL STREET CATCHES UP
r
with
isn't
Banks
the
jn
It's their
Potential Sources of Stock Supply
low
Pe
be-
recently, U.
climbed
common
stock
the
Only
at
70
traders*
war
now
them.
Steel
ol
executives
ers.
another
stock
pres¬
such
Then in 1942,
Wa^
heart—Hitler's troops
b.
^
If
such
companies
were
required to obey the rules of listed
from
transferring capital.
or
Continued
protection
flits
trading. Our
extends
the
All have stock option plans. All
Foundation
stock.
Electric,
Laughlin Steel,
public sale of Camp-
is expected to dispose of some of
its
shares
of
Ford
Motor
Co.
which
Westinghou.se
of
This
law
we
advancing. U. S. factories
beginning to roll out muni¬
were
special benefit under the guise of
Continental Can, R. C. A., Standard Brands, Crown Zellerbach,
stock-market
November, the
In
estate
Campbell
was
sops
anxious
money.
ranee
It
months—and
Hitler^ won,,,:
tions, following the shock of Pearl
Harbor. Stocks began to rise. The
British victory at El
Alamein in
selling
basket,
Financial, American Machine and
Foundry, Monsanto Chemical,
augments the supply
endangered.
weren't
really invested in a com¬
But when he holds for only
stock—he's
If
Street took
their
And the same applies to execucoming to market.
General tives in such companies as Colum¬
Motors,
as
has
already
been L>ia Broadcasting, General Elecnoted, just floated $300,000,000 of trie, Douglas Aircraft, C. I. T.
That
on
has
six
diversify their in-<
fjeci—there will be plenty of stock
stock.
he
pany.
25%
*
their
assets
testi-
in
entirely
threat to American
a
might have to fight totalitarianism
with totalitarianism.
Private capi¬
tal—commmon stocks—would be
a
long,
ent
willing
or;
capital gains — on sales of
securities held three years. When
a man has held a stock that
sell
the
car,
was
capitalism.
true
to
vestments,
be
think
I
1956—as has
able
be
benefit
these shares to
shortage
self-corrective.
will
the
get
new
I'd eliminate the tax
Re-
be
would
that
share.
a
diamond necklace.
capital gains tax instead of the
regular income taxes. They might
loosen the supply.
obey
as
disclosure rules
same
He
of
that
suggest
aminers
investors
many
optioned
executives at
a
Here
—
has
instance
Thursday, March 31, 1955
..
dropped sharply. Note the break
in June,
1940, when France fell.
in for occasional trading, such
profits are income
trips to
go
cently, 19 of these executives took
up options on 45,000 shares.
So,
along about June or July, these
"locked
in"
with
large profits,
They wouldn't sell
because
of
capital gains taxes. He suggested
that capital gains taxes be halved,
to
Usually, stocks
have
He said that
Bermuda,-.or
for
770,000 shares to
prices of $37 and $41
York
A
purpose
carrying securities.
are
fessionals, profits in stocks repre¬
sent- income. Even to
persons who
.
unemployed
had only 6,152
receiving benefits;
The
textile
curing
told
New
of
a
the
workers
new
in
made
of
376,000 persons, in¬
many textile workers.
difficulties which older
many
Rhode
places.
survey of
Oaks
Jersey
the
encounter
in
se¬
employment has been
Mill
and
Esmond
Island.
the
in
The
have
Bloomfield,
the
Mill
We
liquidation
liquidation
in
Esmond,
staff
of
1
the
Volume
181
Number 5416
Committee
made
tion
New
of
the National
studies of
New
worsted
and
.
.
England
The Commercial and Financial Chronicle
of
Planning Association
the
post-liquida¬
employees
of
experience
two
.
of
Hampshire woolen and
mills.
Professors
Myers
Schultz of the Massachusetts
Institute
of Technology made a
study of the closing of the mills
in Nashua, New
Hampshire. A
further
study
is
to
by
appear
Professor William H.
Miernyk of
Northeastern University. They all
tell
the
have
story that older
difficulties
persons
in
getting jobs;
find jobs;
textile workers seek
jobs within
the
textile
industry since they
find other employers reluctant to
hire them; most of these who
get
jobs in other industries have to
younger
take
persons
severe
of the
may
wage reductions. Most
textile workers
ly immobile.
relative¬
are
Professor
Miernyk
concludes that "workers displaced
by the liquidation of textile milis
in
New
England
in this
.
fact
that
industrial
growth and decline do not always
coincide
further
writers
others
in
the
areas."
same
that
adds
"a
He
number
of
have
implied, while
have explicitly stated, that
displaced textile workers
ing
absorbed
be¬
are
by
growth indus¬
electronics.
Our
tries, notably
findings do not
bear
statements.
Instead
.
.
.
out
these
of
em¬
ploying displaced textile workers
in large numbers it
appears that
the
industries
growth
ploying
is tthat
expect
are
entrants
new
labor force."
em¬
into
is
no
reason
to
larger proportion of dis¬
placed workers to be absorbed by
industries
in
the
future
other
than
thas
been
in
true
the
past."
second
reduction
in
industry
major
cause
increased
productivity.
impending.
are
and
(2)
expenditures
only
are
part of the cause for higher out¬
textile
industry has
the techniques of other
The
put.
learned
American
industries
and
has
as¬
them
during
the past several years. There are
applied
siduously
procedures and
management techniques. In addi¬
tion there are new fibres, wnich
new
have lost out
large
industrial
in
uses.
From
level
a
in
of
1.5
billion
yards
in
1947, the volume of cotton fabric
exports has dropped below
600
million yards, with every likeli¬
hood that even this level will not
maintained.
have
challenged
changes
be
each division of the
effect
combined
been
older ones.
found in
the
can
industry. The
changes
these
of
rise in man-hour pro¬
a
ductivity in Excess
annum
particularly
when
effects
the
of
5% per
since
1948,
of
the
became
The- nature
of
earlier
apparent.
the
problem
by the fact that em¬
during the month of
November
1954
was
below
20%
ployment
the
in
993,000
was
level
textile in¬
of
average
1947-49.
the
base
Twenty
titudes
been
of
drop
a
Gar¬
in
the
and
habits
and
of such
use
overcoats.
as
consumption
have
reduced
turnover,
TABLE
■
Textile
par¬
Novemebr
1954
3%
more
product
base
Substantial
Surplus
indicate
measure
in
areas
shown in bold face
have
been
the
in
our
items
and
affected
has
of
tiles
reflected
for
bagging
new
paper
raised
not
These
conditions
the
that
in
fact
parel
the
expenditures
ratio
6.9%
in
7.7%
amounted
1951, 8.5% in 1949, 9.5%
in 1945 and 8.7% in 1939.
tile
capita consumption of tex¬
fibres
risen
has
apparently
not
prewar
levels.
pounds in the period
1925-29,
in
1935-39.
Actually in 1937 and
it
reached
year
1954,
32
was
31
pounds.
the
pounds
Tardiness
in
Trends.
States f-
(6)
and
of
people
living
now
1,365,000
1,082,000
—283,000
manufacturers
apparel
fabric
and
on
proper
testing
led
the
Their
New
27,500
20,800
21,100
5,200
14,100
125,000
66,800
41,600
65,700
26,900
Hampshire-
Vermont
<
Massachusetts
Connecticut
Rhode
Island
—
—
2,400
—
—
—
38,400
—
6,700
7,000
producers
for
58,200
specific end
finally
withdrawal
27,300
bonanzas
later
169,500
New York
96,100
69,000
New
65,800
46,000
141,700
3,600
104,900
Pennsylvania
—
Delaware
—
2,700
307,200
27,100
7,600
Virginia
42,700
38,400
244,200
139,800
$224,300
114.800
104,100
55,500
47,900
39,900
*34,900
8,900
-
North
Carolina__
South
Carolina--
Georgia
-
Alabama
-
Tennessee
Texas
_f
—
—
132,400
10,200
-
—
658,100
—
—
—
—
,—
605,700
—
'
36,800
900
(7)
*Rockmart
—25.0
13,500
Minnesota
4,900
11,100
'3,100
Missouri
3,700
*3,100
22,100
17,300
8,200
6,300
-
—
-
—
6,300
19,900
have
7,400
are
not available; figures shown
tData includes
states
not
^October,
figure is not available; figure shown is
State Departments of
/
Labor
and U.
and
—12.7
8.0%
—
in¬
a
non-fabric
in
over-all
income
reduced
cut
2,400
—17.8
1,800
—36.7
600
S.
8
12%
or
up
—21.7%
1,900
to
residual
a
demand
claim
on
for
industrial
tex¬
The Industry Has Not Devel¬
oped
more
Department
Significant
Any
The
of
sified
textile
other
to
users
speculators, during
after
the
the
textile
in¬
financed
or
business
old
continue
no
through
the
become,
the
of
which
at¬
more
thereby
profited
acquired
and
merger
a
stock
provi¬
income
corporate
They
v
particu¬
carry-over
have
tractive.
pay
estab¬
to
interests,
the
law
tax
high
profit taxes,
out
successor
corpo¬
generally
was
non-taxable transaction.
The
a
suc¬
corporation has been able
to
the carry-over provision as
a
use
of escaping future taxes.
means
In
instances
some
these
tax
sav¬
ings have amounted to $20 to $30
million.
These mergers, based on
capitalization of the loss posi¬
the
tion
of
have
been
textile
for
the
merged companies,
widespread within the
industry and are matters
public, investigation.
real
the
In
second
of
interests
invest
less
place,
have
to
erations.
has
been
abreast
of
to
ence
type
to
keep
have
mills
in
of
who
often
prefer¬
modernizing them.
procedure
larly
times
their
op¬
owners
unwilling
the
abandoned
their
latest
equipment and those
have
unwilling
survive un-v
can
the
number
a
been
modernize
No mill
it
This
attractive particu¬
was
at
times
and
places where
the real
estate
was
of substantial
value and when
the
for
In
used
the
a
market existed
equipment.
third
place, the decline
in the market for certain products
has limited the capacity
required
them.
have
ing
in
to
Older
those
managements
cases
been
unwill¬
into
new
product
move
and
areas
start
afresh
in
the
competitive struggle.
We
tion
urge a
into the
structure
and
thorough
effect
investiga¬
of
the
upon
tax
our
process
abandonment
purchases.
and
Our
of
mergers
tax
system
inordinately encouraged these
New
the
of
the
industry has inten¬
competition
As
for
estab¬
traditional
—23.2%
Employees
laws for
textile
personal
accompanied
in¬
ag¬
by
(10)
Imports Have Seriously Af¬
fected Some Divisions of the
While the textile
States—1946-1954
whole
(Includes spinning, weaving, knitting, dyeing,
finishing and carpet plants)
Plants
the
Industry.
Textile Mill Liquidations in Eastern
—New England—
tax
And
widespread plant abandonment.
TABLE III
Employees
S.
are
—Middle Atlantic—
Plants
Emplo
and
Employees
233
49,095
87
24,775
,12,720
not
worsted
seriously
time
industry as a
particularly
by imports, the woolen
has
affected
-South-
1946-49
for
Bureau
for September, 1954.
August,
of
1.954.
Labor
as
been
division
injured
the
has
from
volume
of
has risen in the face of
been
time
to
imports
a
shrink¬
1950-52
200
50,715
72
30,745
3,125
ing market.
207
68,135
77
36,315
9,020
then tended to aggravate and de-
Total
640
167,945
236
91,835
,
Statistics.
I CI¬
could
a
therefore
sold
larly since the
of
with
excess
textile
then
and
and
Others
lished
were
business
or
(b)
or
who
war,
grandizement
lished markets.
Labor.
—23.2
out
textile
dustry has been one of the most
important areas for the utilization
of Employment
—16.2
4,800
capitalized at very low
sold
terests,
sharply
more
expenditures, which
become
Markets.
U.
same
generations.
movements.
1
Security,
several
tiles.
of labor force.
Bureau
mills
the
(8)
from
12% of labor force.
fUnemployment
many
by
Some of these older inter¬
(a)
ests
has
1,300
place
owned
for
were
much
^Unemployment
suf¬
man¬
values.
'"Talladega
—12.5
has
They had survived the depression
expenditures. The drop in man¬
ufacturing activity eliminated
shown separately.
1954
interests
*Gadsden
—13.7
1,900
been
plant
5,000
industry
unprogressive
first
the
*Decatur
7,600
52,400
In
have
9.3
—
Have
Mills.
agements.
5.3
—
textile
from
8.1
—
10,700
The
fered
Owners
Their
1953-54
♦October, 1954 figures
SOURCE:
therefore
"Anniston
Plants
8,200
of
contraction
which
apparel
into
—10.1
4,300
the
and
-Total
—
are
new
industry has also suffered
from
'"Alexander City
Far West:
California
even
General Business Contraction
—34.5
4,000
—
—
as
suf¬
substitutions
hear
we
business
Source:
Illinois
New
The
—27.5%
84,600
Abandoned
in
"Cedartown
—26.0
Mid West:
—
have
tire.
GEORGIA
ALABAMA
11,600
rayons
and
such
—30.1
South: f
Maryland
ensured
In
tire
cord,
rayon
displaced cotton.
Now nylon is
battling it out with rayon.
Al¬
'"Columbus
—
meantime
industries
and
the
under
up
the
has
but
as
novations.
—28.2
19,800
—
222,600
stand
In
older
ready
—
not
wear.
fered.
—40.8%
—116,600
the
Textile
(9) Many
who
innovators
rendering obsolete
*Parkersburg
Jersey
the
demoralization
the
t Cumberland
re¬
in
industry.
to
for
did
items
MARYLAND
Middle Atlantic:
—
consumers
failures ' followed
actual
WEST VIRGINIA
28-3,100
revul¬
—35.3
—41.6
many
the
and
a
The substitutions have provided
woolens
—46.6
14,700
put
without
markets
items.
proven
^Reading
—53.8
con¬
have been wary about buying un-
iScyanton
fShamokin
fSunbury
j-Wilkes-Barre
*Williamsport
—33.2
2,800
done
manufac¬
among
—24.4%
the
shortcomings
their
to
of
have
sion
'
Maine
Has
repel the American
Many
turers
fllazleton
fMt. Carmel
organized
markets
new
cessor
claims
PENNSYLVANIA
New England:
entirely
Competition
fabrics
fAltoona
little
is
for
ration
experience brought
—20.7%
been
fibres.
bad
Percent
and
have
not
were
other
excessive
uses.
-Change FromFeb., 1.951 to Oct.,1954
in
want
Rayon
which
Inter-fibre
sumer.
JERSEY
There
search
sions
items.
which
by
much to
*Rome
developed by the rub¬
was
capitalization
Peonle
areas.
fabrics
The
*Hudson
potential
conveyors
manufacturers.
ber
little
Discouraged Buying.
ISLAND
*Utica,
V '
v;
'
'
New
Meeting
filled
fAmsterdam
Employment in the Textile Mill Products Industry by State
February, 1951 and October, 1954
\
capita.
per
markets
fProvidence
These
for
tion with the cash accumulated in
sumption increased to 28.1 pounds
*North Adams
YORK
which
that
In
con¬
tardy in meeting this demand lost
NEW
is
consumption
capita
per
woolen
RHODE
of possible outlets.
A much discussed new
immediately
prima¬
rily interested in avoiding the ex¬
cess
profits tax. They paid high
prices, which gave the original
owners
large capital gains. Tne
purchasers financed the transac¬
the
over
27.3
*Paterson
United
with
compared
as
washable
plastics.
Aggregate
to
re¬
in
1954
suburban
NEW
( Wage and Salary Workers)
February, 1951
October, 1954
ap¬
con¬
number
TABLE I
-Eniployment-
of
total
to
expenditures
sumer
reflected
are
fSouthbridge
fWebster
many
packing
and
fibre
con¬
population
total consumption.
capita
Increased
have
Few have ven¬
tured to open up new demands
through research and intensive
of
turnover
s;:New Bedford
by the loss of tex¬
wrapping,
to
high
per
sumption.
fibre
are
the
eliminated,
producers
maining markets.
they have not significantly
*Milford
of
industry has
lost
major outlets for textiles.
diversity
Apparel has been designed for
urban
living
despite
the large
therefore
The
apparel.
Despite
of apparel
on
*Lowell
(1) Loss of Domestic Outlets.
of the
debt,
reduced
a
*Fall River
presentation to an
these problems.
enumeration
to
tLawrence
These hearings
provide the forum for an
adequate discussion of these
limit
expenditure
the seeming
(5)
MASSACHUSETTS
industry.
shall
mortgage
*Burlington
state of affairs in
We
of
been
39
feverishly developed the
more
goods, the
consumer
burden
Consumer
cannot
problems.
heavy
have all contributed
the
VERMONT
cau$ffe
many
ticularly
have
remaining
market
inadequacy of income, the
level
Causes For the Present Condition
There
out¬
appeal of other expenditures, par¬
'•"Biddeford
productivity of 29% in the period.
for the present
The
1939
MAINE
the
increase
an
total
Expenditures.
from
period of 1947-49. This rough
than
and
women
affected
From
type)
producing
were
for
Changing Pattern of Con¬
Per
SEPTEMBER, 1954
in
workers
sharply
sumer
II
of
Areas
Labor
(Major
have
Casual at¬
ticularly as clothing lasts longer.
Many significant changes in
clothing patterns such as the sub-
actually 103% of
period
of
1947-49.
less
has
garments
was
percent
Types
capita consumption of textiles
Ac¬
to the Federal Reserve
Board, textile mill production for
month
in
due to the diminished
em¬
cording
the
per
which
persons
the
There
dresses
style,
Changes
ments.
is
ployment
dustry
(3)
and
the acceptance of slacks and sport
shirts instead of suits among men
ex¬
excess
be
the
(4)
industry has lost major
markets.
end-uses
suits
surveys
Loss of Export Markets.
port
stitution of blouses and skirts for
put.
processes,
These
has
re-
cloths,
The losses have been
household
The
man-hour
use
particularly
equip¬
buildings.
new
new
plastics.
been
Table
aprons and curiains
was
of
than
have
blinds.
to
purchase
But these
shades
by
The
innovations
One major factor in
this jise has been the
placed
$4 billion.
More
employment in this
is
Window
expenditures
these
of
the
for
expansion has
over
rather
Rising Productivity
The
and
ment
the
His final conclusion
"there
a
for
illustrated
comparisons of recent em¬
ployment trends in New England
the
bulk
expanding
gate
conceal
amounted to
investments
highly aggre¬
expenditure
s
modernization
not
The
,.
Since World War II,
industry
are
which
area.
the
are
being
absorbed in large numbers by the
industries
equipment.
(1531)
51,245
24,865
These
Continued
imports have
on
page AO
'
t
46
The Commercial and Financial Chronicle
(1532)
Continued from page
tradicted
39
issued
the
by
factual
partment of Labor
of
Depression in the Textile
Industry and the Way Out
Ihe
protection as an
essential industry.
The threat of
a major increase in cotton textile
from
imports
Japan
as
impending tariff negotiations is
real
one.
Any action which
tvould compound the difficulties
p
this
yjf
industry
depressed
„
,
„
,,
„
(11) Pncis Ifeve Been Set By the
highly competitive marprices have been driven to
low levels.
Mill margins
very
also
tiave
the
been
industry
»rated
in
have
their
set
statutory
dent's
that
9q
Presi-
Economic
Annual
Report
(than
minimum
"higher
a
the
in
_
#
jts wake" is
jn
of
reiteration
argument used through the
stock
(6)
by the opponents of any
legislation setting fair minimum
years
that each inin the basic minimum rate
The facts
wages.
crease
are
in-
Price
employment.
where they have occurred
creases,
a^ aip have been
be insignificant.
by the current Department of La-
others to aid
the
victims
to
bor
75
study— was.
an
prevent unfair competition within
an-hour
the industry.
fected
-
—
had
we
the
directly
6% of covered
boost
the
on
75-cent
than the southern wage
products predominantly
0f the
in
of the proposals listed
the
South
prcssure
their
°"
inCOme
Hi;h
of
Hate
has Con-
cenlrated
mill
£hases
ihe last
*iod
of
been
last few
in
now
a
consolidation.
stimulated by
been
the
the
are
we
has
1943
decline
worsted
of
industry;
"Of
-
.
integration
production,
the
to
which
of
principles
as are
applied
surplus food.
deal
stockpiles for
of textile
armed forces to
our
for
stimulate immediate employment.
(d) Contracts should be granted
brought
to
factoring
mills
in
distressed
with
of
„
.
manpower
The
lne
areas
is
their
not
..
certain
,
unorganized
industries
fundamental
n
receiving
minimum
this
gaining
power
nartlv
in
bar-
which is the princisubstandard
The nuroose and
The purpose and
minimum
of
wages
law
imbalance
of
cause
decent
wage
and
cause
wage
actual
actual
legislation
is
to
tIessed a eas(3)
Scales.
resulted
for
in
union
aid
the^ deterioration of
increases
wage
a
effort
long-term
n0
to-
ward s?lmulatlng the growth and
expansl0n of the lextlle industry
we "rge a researeh P/ogram such
as.?as -e5n t:onduTc,ted f°r the raw
COtton lndustrJ;-' !t sl;oald be de"
Jiigh rate of unemployment have
enabled employers to resfet
demands
As
tsas
the workers.
Northern
,
industry there
hov
they arp miitp wiiiinc in maintain
are quite willing to
higher standards if wage levels
•
were
equalized
throughout
the
bargaining
nower
The adoption of
to
or
achieve
a
realistic min-
a
imum wage in 1955 will have no
greater consequences than those
experienced in 1950. A statutory
wage of $1.25 is justified by the
rise in livinS costs and the sharp
In the
South, the low-wage mills
to
undermine the
wage structure. Some of the south-
western
mills
have
threat-
even
cmed the wage levels in the southeastern states. The internal
south-
em
competition has brought wage
.-reductions
union
in
a
number
of
non-
shops.
^
The injunctions which have
nullified the Secretary of Labor's
or-
is a
need for
a
,
wnnl
wool
desl%n
^
Fairman & Co.
L°S ANGERS, CaW.-^harl^
ot
the
f
r;f
the
of
use
which
utilize
by
them
acquisition of corporations
operations.
properties and
(d)
As
an
of
alternative
a
Cusiomers' Brokers
Anniversary Dinner
special
the
tax
imi.
Brokers
niversary
and
Unfair
spread-
at
the
Unfa?" Ad
van
tagres Leading to Unneoesarv
Migration^
Annth^Tr
efim
+
f
a'
•
the
In order to
trated any revision of the prevailing minimum wage.
recover
A national minimum wage
of $1.25 cents per hour.
We be-
lieve that the President's proposal
of 90 cents will be inadequate. It
UU111 /uullCi
Customers'
16th
an~
on
reception v/ill be held at 6 p.m.
and dinner at 7 p.m. Tickets
are
are
$12
per
person,
including.
gratuities.
the
on
tariff
reduc-
•
wm deduce
"ven morfshi™lT{han ?hev
have to date with theconseauence
fhaTfor^n'w^uce?s wTirnot
ba; ^
te
Zmanent
in
"arkets
thTrates Vdutv
texliTe iteml
foothoM
0
David C. Kuh Joins
A
.
we
uree
on
] tho tariff schedules not be fT?J™,e^^d'icb<!du'!s not b| ^
Reynolds On Coast
(Special to The Financial Ch-onicle)
SAN
FRANCISCO, Cal.—David
with
C. Kuh has become associated
Reynolds & Co., 425 Montgomery
Street. Mr. Kuh has recently been
with Managed Investment ProgramsPrior thereto he was a
partner in Hooker & Fay.
Alston S. Patterson has alsojoined the Reynolds' staff.
With Neal Kellogg
(Special to The Financial Chronicle)
x^v
t.x-c
anxxxixvctKc:
_—+
ui
wa-
endorse
Report for
ease
the
new
areas
movement
the
similarly
or
policies
of
WOODLAND,
Eckel
Neal
workers in unorganized mills
of giant industrial corporations to
"to
to
people
Calif.— Kenneth
is now affiliated
Kellogg,
WoVz
First
with
Street,.
that
people
should be provided for "minimum
needs
in
we
concur
their
old
age
or
in
the
Unfortu-
minimum
of
ne€ds
protect them from the vengeance
Report is grossly inadequate,
We, therefore, propose the following-
and unequal economic powers of
these huge economic units.
(d) We urge
a
essential.
Administration has
the
expansion
opment
has been
of
program.
,a
the Economic
(a) Liberalization of the
(5) Regional and local developare
in
The
present
recommended
its
area
Until
develnow
it
step-child with little
We believe that the President's support. It has largely been
en-
that
they
the
provide
(Special to The Financial Chronicle)
CHICAGO,
111.—Richard
A.
Erley has become associated with-
Baxter, Williams & Company, 231
South La Salle Street. Mr. Erley
was
previously
with
the
Conti-
nental Illinois National Bank
Trust Company.
and!
With Federated Sees.
unem-
full-scale study pioyment insurance provisions
current period of distress.
ment
'presented
With Baxter, Williams
occuoations."
new
(c) We urge a further protection event* of misfortune."
for the self-organization efforts lately the definition of
of the 35-hour week for this inthe dustry at 40 hours' pay during the
two-thirds
so
of
(Special to The Financial Chronicle)
BATON
ROUGE,* La.—George
R. Beatty, Joe T. Collins, Gove D,
Davis, Malcolm L. Prater, and
William L. Senn have been added
to the staff of Federated Securifor unemployment
benefits, ties Corporation, Louisiana Na¬
as two years.
tional Bank Building.
earnings to
unemployed persons. For workers
displaced by abandoned plants we
urge a longer period of qualificaaverage
tion
such
(b) In
we
urge
weekly
of abandoned plants
consideration of the ap--
case
pication of the principles already
Ir\c/»nh F
Cullman
Jr.
J°Seph V yullman> JT'
annual economic report takes an gaged in making occasional politi- applied in the railroad industry
Joseph F. Cullman, Jr., partner
indefensible position in its attack cal forays into distressed areas. It under the Transportation Act of in Cullman Brothers and a m<Lm~
^Sainst a higher than 90-cent min- has sometimes captured a local 1940, which provides that when- ber of the New York Stock Ex-
siimuian| to disargani- imum
to
Walsh-Healy Act which has frus-
and worsted industry.
-
Amendment
of workers has been wide-
the
wage cuts which have been imposed upon the industry and to
prevent further wage cuts and unfair use of workers, and to estabiish fair competition the following
are essential:
(a)
\b) We urge the repeal of the
Fulbnght
textiles) and $1.20 for the woolen
sidles Create
be
dinner
of
their
April 21 at.
the Sheraton Astor Hotel. General
^ons- Jn..vieY
y
: demoralizayy
textile industry and
the undue burden already imposed
upon tbe textile workers and be-
Economic
competition
will have little or no effect in
textile industryj^vhere the Secrethe woolen and worsted
industries tary of Labor has already found
under
the
Walsh-Healey Public that the prevailing minimum wage
Contracts Act have accelerated
the is
$1.00 for the major division
T-demoralization within the indus- (cotton-rayon and miscellaneous
<?nh
could
hold
recommendation in the President's
prevailing minimum
in cotton-rayon and $1.20 in
(14) Local Tax and Finance
what
will
gains resulting from such use of
Davidson Adds to Staff
the eapital.g.ains tax or the carry(Special to The Financial Chronicle)
over Provision.s f°r the specific
SAN FRANCISCO, Cal.—SherpurP°se
using such proceeds
for local development, worker ad- man C. Hall has been added to theJustment programs and local pub- staff of Davidson & Co., 155 Sansome Street, members of the San
/r^°^s'
^t
(7) Exemption of textile prod- Francisco Stock Exchange,
^ ~ further
ucts
from
stimulate new propl'llly" dellribed""a7 a" decent ™e"L..°,LP!a"tS:
aggressive merchan- American standard.
tiers for $1.00
wage
...
below
Association
The
«les and the wholesale abandon- H.
.
much
the trading de-
in
use
.asta &
,
,
Sheedy With
(Special to The Financial Chronicle)
too
UAbllls'
(4)
nlants
'
Charles A.
I-SSS5
dab!'ic "library" t°
expense
country.
3have continued
.
,
man-
^uthernrSwagelnsianda^d^SSthough
nsoi-rfi
of
..."
.
necessary f°r retraining of workers dis-
SS=K5SS SSSHi
upon
,
tax
i00king to the later abandonment
wages.
result of
result of
behind the ^vels enjoyed by other
American workers.
Union
for
provisions
carry-over
pov-
.
of
nower
corrects
pai
.
,
for the
progression "in w^e's noT tool a?
The intense competition and the
'
.
(e) Federal assistance is
5.°
The elimination
position
and
income
,
in
wages do
buve been minimal and have pro-
on
,
,
elimination
corporations
(13) The
Inordinate Pressure
Eligibility for early retire-
Persons *d1s^
!he abandonment
of the capital gains tax provisions
J."
*fP^a
k,^S
jnesse„ P
acauirine^ businesses for
{^ '
prices
tvithin the same interest
grouping,
an
years
artificially stimulate migia- Ryons & Co.
,
n]nT.fc
partment.
L U
(c)
enable workers who have little
Absence of a Realistic
Wage Floor Has Maintained
(d)
aoan-
present provision is
unsatisfactory. The allocations
areas.
industry for a pesubsequent to
or
two
of
•
a qa
fundamental
the
low
T{
workers
The
Reestablishment
disallowance
-j °
hiring and
change,
the
are
.
shut-downs,
plant
bargaining
clothing to
practice
has
and
Distribution
same
(c)
and
drive
.
selling
the
has
woolen
diversification;^and the
...
ae-
the tax laws;
the
Distribution of textiles to
the needy in our own country on
years
new
not
needy nations overseas.
(b)
preferential hiring rights for
j0bs established by the same
believe
we
...
immediate program pieieiy misses ttie point wnen ne
As an
following:
(a)
re-
This
on
causes
The movement from
war.
during
that
large
they began during
through
vived
in
the
J
.
,
(and) minor efsuch variables as employ.
.
technological
-
t0 help the industry, we propose
pur-
continued
uumbers since
1944
and
Th
>
(b)
i
(2)
the Industry.
mergers
have
lly'
of
move,
plant liquidation,
r" if,axable income bv industrial
taxable income by industrial
t,
undertake this lesponsibil- overtime.
if Presidents message com-
0
Mergers
and Mill Purchases
i'ects
No
ent Administration has been wil
-
(12) The
increases
pay
goyernmental agency in the pres- ment,
tevels-
The
below.
which
searching inquiry
in "only minor effects other than
dustry and
had
have
problems of the textile ina consideration of each
phases
following:
rate
1950 increase to 75 cents resulted
ioroduced
sur-
in
a"d!°?a' ta*ne"n,^®I Los Angeles Stock Exchange. Mr.
atsu.. .dles,..!0.. ,?nv,.e entelP"se Sheedy was formerly with Lester,
employ-
90-cent minimum would be
wviuium,
(l) We urge a full investigation
are
Some
.
40-cent-
nau-whim..m.u.u
20%
a
-
In 1950
on
less efficient mills and those pay-
on
circumstances
to
incurred
cancellation
or
There is need of establish-
corporation
.
the
*ng more
jng
Tiew
to
proc^tas 01 municlPal A. Sheedy has become associated
1S1SU??" Tu!.imafim Vrfth Fairman & Co., 210 West
shauld be the elimination of state Seventh Street, members of the
consequence
.scales
abuses of tax
losres
for
leases if required to
(c)
required
residences and reim-
new
home
of
rjocj
Mergers and
reference
!
recommended
which
rate
substantial
more
novv
increase
over
a
Ges
CC3.
tions which have been offered at
-
rise
by the President.
recommenda-
The following are
-0
the
88%
demonstrated
cents—as
and would directly affect less than
a
now
system.
Congress has a distinct
responsibility to study the abuses
Qf the tax system with particular
(
5% of eligible workers.
The above report finds that the
As
do not
purposes
Actually the 1950 increase from
here-
ficiencies.
and
sale
enterprise.
reauire
minor as to
so
various times and which
the
their
regional
to
if
losses
wage
move
reim-
expenses
rounding
the
present
merger maced as a result of plant abanand movements in the textile industry, oonment.
production
*n
increases
with submitted for full consideration by the Joint Committee:
and
extensive
research and planning. Agen-
area
small
ef-
reflect
upon
a
a
southern
which
scales
ent
More study and thought must be
provided for the stimulation of
high
levels
wage
More-
pioyment in several industries and
bring generally higher prices
Willi
at
agencies.
in all but the distinctly local
problems, development is depend-
cies for such
exist.
than
prices
different
many
of
might well cause lower
production and substantial unemcents)
40
the major mill and selling organ-
izations
hour
an
statements
The
concen-
highly
cents
facilities
over,
agement; others to prevent greater
demoralization; and still others to
relatively few hands,
a
90
Wage.
of change and unenterprising man-
low.
very
now
displacement
bursement
the
over
defined
allowances,
and
greater
have to be considered. Some
designed to stimulate the in-
dustry;
receive
to
dismissal
command
are
In this
%et,
are
have the concentrated support of
the full Administration and the
the past 20 years belies
grams
Highly Efficient Mills.
ees
with minimum wage legisla-
by
Action
A
■
,
He avoided.
..
oe
courses
To help deal with the problems
raised by the large scale distress
and the decline in the textile industry many approaches and pro-
must
later
in the past has been accompanied
.j
n
0
a
(and
including abandoned), employ-
bursement for movement
than
the South.
result
a
4>l
consolidated
of Commerce undertaking. It must
tion during
has been an unhealthy competitive situation which has called
forth protests both from labor and
management in the North and in
rising imports and
of
and
Department
a
Thursday, March 31, 1955
All evidence on the experi-
the President's fears about a higher
already difficult sitThe industry must look
need
in
fS-cent minimum wage of
.
ence
an
impact ol
is
must be more than
the effects
on
as
sources
.
i950.
zation and unfair competition has
nation.
been the local inducements ofwilh
alarm
at • any
increase of fered by communities in the form
imports
of
serious
proportions of tax exemptions, profitable lease
since they would aggravate what arrangements and local financing
is now a seriously disturbed con- of plants and equipment.
These
dition.
It is an industry, which have encouraged
companies to
must be maintained.
'
abandon existing locations and
The hard and soft fibre cordage
move to new properties with little
and twine division has also felt cost and investment.
The result
moralize
thu
and means for implementing a program. We welcome the
expansion of this program but it
report
few days ago by the De-
a
.
wage.
It is completely
con-
news
headline, but it has few
re-.ever
facilities*are coordinated
or
change^-passed away on March 18,
Volume
Number 5416
181
.
The Commercial and Financial Chronicle
.
.
Vice-President
Continued jrom page 2
tional
Our
1865.
Under
his
leadership,
the
high quality
policy that "the customer
and the
is always right"
have
and
spent to expand the capacity
the Frederick & Nelson store
by 50%.
Because of the rapid
population growth of the Pacific
continued
this
to
The
Field's has always blazed the way
in the merchandising field with
the
ban
first
basement
floor,
budget
store
the first department store restau-
ton, looks
rant,
gram
the
first
men's
separate
store, and the first personal shopping service.
Although the development of suburban branches
of
large
stores
downtown
has
been
prob-
ably the most significant postwar
event in the retail field, in the
late
'20s
Marshall
Field
had
al-
ready established suburban stores
at
Oak
Park, Evanston
Lake
and
Forest, Illinois, which have shown
a
steady growth over the past 25
A pro-
munity
acquired
and north of San
company
Francisco. From
1946
through 1953, total capital
expenditures of about $24 million
were
cago
and
suburban- stores
1950-1952
inclusive,
$10
a
in
Location—
of
Park Forest,
-
which has
Fall, 1956
On
Fall, 1956
by
*
a
There
(Skokie,
Ill.)__
sizable enough to take care of larger
Wauwatosa, Wise, (suburb of Milwaukee)
Fall, 1957
Short-Terms
short-term
275,000
demand
We
that
estimate
comfortably
can
the
the
meet
re-
quired initial investment for these
stores
out of
that these
duce
annual
of $35
estimated
3%%
of
cents-60
cents
$1.6
and
million
later
on
an
taxes
of
lie
could
(70
cents-80
slow
a
are
above
pany as a
$1.4-
store
for the corn-
average
to
the
from
mar-
present
in
upturn
being sold
are
ex-
eluding Fieldcrest Mills, net sales
in the calendar year 1954 showed
tinued
the
1953.
On
slight
a
,
the
fiscal
uptrend
year
of
11%,
while
increase,
share.
It
standing
that
more
a
is
months
the
of
sales
and
foreseeable
lessening
powers
November and
earnings
in
basis
high
the
at
a
have
Market
Book
been
and they have been at¬
Value
Jan. 31/54
% Book
Mag.*23/55
Marshall
Allied
34%
—
Stores
*$37.16
55%
Field.
-
the stock market.
nature will be
50.42
109.3
in the
5.4
licity factor, up to now, seems to
,
27%
29.99
92.1
1.60
5.8
upon
33.94
1-33.5
2.50
4.5.
ever,
that
May Department Stores
36%
24.15
151.7
1.80
4.9
the mortgage
a
31, 1953.
-
-
comparison
business will not be an
selling lower than the other prin-
In BL Y.
*r
...
V.
Issue—
Marshall
-•<>
-
'
Jiaj-ket Price
Mirfa
57%
34%
63%
55%
35%
77.8
157.4
Dep?artrpeiit.%Stores_____
36%
35
104.6
Despite capital expenditures of
$24 million in the 1949-1953 period for modernization of the Chiand
Frederick
&
Nelson
stores, sale of the Fieldcrest Mills
Sept. 30, 1953, enabled Marshall
to close that year with an
Field
excellent
tion.
sets
working capital - posiQn Dec: 31, 1953, current as-
of
$89.01--.million,' including
will
55%.
-
$34.4
3.8
times
million,
were
current
equal
liabilities
the
r
that
working
12 months later will
have
Meeting of the Middle
New
Hotel
be held
will
Women
Biltmore,
New
City, Friday, Saturday and
day—April 15, 16 and 17.
It
is
to
jwomen
of
Maine
$23.5 million, leaving a net working capital of $65.5 million. It is
estimated
Bank
of
cash and U. S. Government bonds
of
and
Blanchard
both
Miss Rehme
on
the national
report
activities of the Association.
The
visual
meeting
with
end
activities
television
Mrs.
will
a
demonstration of the radio
of
the
members.
Group
presentation will be made by
Irma
S.
Robins,
National
publicity Chairman and Assistant
Relations, The
Square, N. Y.
of time.
U. S. TREASURY
STATE, MUNICIPAL
and
field.. It is indicated, how¬
V
/
*•
PUBLIC REVENUE
*/
capital
shown
The
estimated
that
from
on
at 4:30 o'clock.
Friday
afternoon
The dinner meet¬
ing will be presided over by Miss
Regional VicePresident of the New England Di¬
some
New
vision and Assistant Branch Man-
York Stock Exchange.
Sundlie,
■
"
'
manship—Our Major Tool."
The
Saturday .session
at 10
discussion,
o'clock
with
will be¬
ley,
Assistant
Bank of New
that
York.
of
the
The subjects
discussed are:
Bank
and Its Staff"
will
"The
Treasurer
a
\panel,
"Banks Are People,"
moderated by Miss Jeanne Brad¬
will attend.
will begin with
\
*
Mass., will be the speaker at din¬
ner.
Her subject will be "Sales¬
Sun¬
200
,41.
Bank,; Boston,
gin
Virginia
conference
registration
Shawmut
York
some
officers
banking
to
at
Gertrud
increase. The common stock
of Marshall Field is listed on the
of the National Shawmut
Bank, Boston, Mass.
Miss .Mabel E. flamtfton, Assist-,
ant Branch Manager-of-the Na¬
ager
tional
England Divi¬
sions of the National Association
87.0
______________
A Joint
City in April
Atlantic and
59.2%
35%
cago
Miss
Commercial
Savings Bank, St. Louis, Mo.
National Bank, Franklin
f
I
'% 1*44; High
27%
: May
on
...
Dry Goods
Federated Department Stores
Associated
,r
i
•'
'*•*«* 15*.
Field_j:___i_____,_
Allied Stores
-
postwar market peaks::
MUwfcet rriee
-
and
SECURITIES "
Bank Women Convene
~"•
Southern
President,
.
is
.
'
Boston, Mass., and Miss Virginia
A. Rehme, Vice-President of the
N. A. B. W.
and
Assistant Vice-
of Public
market and in
unfavorable development for
v
especially cipal department store - equities
pertinent in view of the fact that relative to the 1946 highs, which
the company's common> stock is in
most
cases,-, represented
the
.
Others,
and
Seamen
for
Bank
(the Suffolk Savings
slowing down of the rush in the stock
the Government bond market.
Dec:
of
Assistant
and
A. B. W.
Franklin
continuing to sound warn¬
what is going on in the mortgage
55%
of
*N.
have had little or no influence
Stores
This
the
Treasurer
Director
conditions whicn have been developing
building industry, Here is another case in which the pub¬
Federated
-*As
of
President
the equity
quite a few of those who are
Associated Dry Goods:--
Dept.
Miss Cora I. Blanchard,
operations of the
told only with the passing
58%
-
York).
of .New
Bank
ings about the unhealthy
Yield
'■
$2.00
with the ""Na¬
(formerly
City
something of a more per¬
in the equity market or will be
3.00
92.2%
presiding. The invo¬
be
given
by
Miss
Pepper,
Associate
Whether this is just a rallying
Likewise, it appears as though
;
Kate
Value
-
Member
The
The publicity which has been given to
important in the mortgage business are
Dividend
Catherine
and
Fulbright hearings appears to have done very little
down
manent
Estimated
Mkt. Price
Priee
will
tional
H
"'V
City,
cation
The members will thin hear from
much in demand.
obligations
increasing of the credit limiting
or
that be.
tone
phase
lively low ratio to book value:
yield
but
to
rela-
are
York
it seems, will be concerning itself in the
future with what is going to happen in the way of a
market in the
major department store chains, the
common stock sells on a relatively
Present indications
of the Chase National Bank, New
Mortgage Markets
The Stock and
Relative to the equities of other
shown
was
in
The money market,
spectively.
substantial
earnings improvement
December.
under-
our
much
Metropolitan
net income
and
will
Chairman and Assistant Secretary
very
maturities.
of savings deposits
the final Conference
open
with a brunch
with
Miss
Thekla
I.
Arrangements Committee
Sunday,
day,
meeting
of 1955 for income purposes.
to the 3%
tracted
in the 1955-1956
fiscal year will already exceed
$200 million and $3 per share, re-
in-
net
amounts
substantial
fact, it is quite possible that sales
or
common
that
1952
comparable basis,
a
it is estimated, 'rose about
from $2.61 to $2.90 per
come,
in
con-
Inter¬
Australasia,
Development, who will speak
the subject, "The World Bank
and the Private Investor."
As agaist t.iis, there
been sellers
of some of the middle maturities with the proceeds being put to
work in the 3s of 1995. These banks, according to advices, have
taxes of $3.50-$3.75 per share. In
for
Banquet
The
City.
Bank for Reconstruction
was
indications that certain of the deposit banks have
$240 million and net income after
results
Secretary
and
on
authorities have eased off or come
Government
Assistant
and
York
and
to happen until the credit limiting policies
intermediate-term
Thompson is Regional Viceof the Middle Atlantic
Burns,
still
keep the shortest Treasury obligation very
Miss
which
national
holdings of the shortest Government issues,
selected issues in order to fill out
are
de-
and
strong
a
come-back in the second half and
are
at
Thompson will preside.
Africa,
offerings of these obligations.
issues
of
ja re¬
speaker will be Mr. A. S. G. Hoar,
Director
of Operations,
Europe^*
pretty much in the doldrums, even though there are reports that
some
of the commercial banks have been making purchases of
mand for consumers' non-durables
such as apparel.
> • ...
Looking further ahead, we can
visualize annual sales of $225-
gins and earnings staged
their
monetary
The
particularly
benefit
to
;
Bank
of The Union Dime Savings Bank,
to an end.
For the time being, however, it seems as though the investment of
funds by public authorities in the short-term Treasury market,
along with other non-banking institutional buyers that must have
a certain amount of
the most liquid Government issues, is going
the
of
sales and profits
& Nelson
add
to
/;
The
Banquet
F.
New
the recent offering of Treasury tax antici¬
this is not likely
but
whole.
should
pany
year,
profit
like
Because the relationship of durable goods lines
to non-durables favors the latter
in Marshall Field stores, the corn-
the
cents)
last
start
that
West,
the
in the
reach
to
at Seattle should continue to run
on.
After
indications
North
of
operation
expected
are
of the Frederick
would
million
<50
share)
per
of
four stores
the
earnings
$1-$1.1
years
pro-
at
Based
after
sales,
to
early
sales
million.
return
amount
should
stores
stores
show moderately higher sales and
profit margins in 1955.
Reflecting the steady population
and industrial growth of the Paci-
working capital and
new
initial
rate
Chicago
•
o'clock
Division
pation certificates tended to mop up a great deal of tne near-term
money which was around and seeking a place to be put to work.
It is evident that not a few of the larger commercial banks would-
fiscal year ending Jan. 31, 1956,
should continue the uptrend. The
company
•
•
•
6
President
Equally Favored
Government
though
even
At
Miss
instances in which some of the
of 1995 if the market for the securities which
The
Building.
Mabel
other hand,
285,000
Orchard
special tour of the United Nations
Annual
substantial amount of the buying
are
of
Arnold
Anna
Mrs.
be
ception for members and guests.
This
will
be
followed
by
the
there are reports of swops being made
from higher coupon non-Government issues, with the proceeds
being put to work in the most distant Treasury bond. It is evi¬
dent that more money would be invested in the Government 3s
the
The; guest
City.
will
Hedgeman, Assistant to the Mayor
of the City of New York. I The
luncheon will be followed by a
into the 3s of 1995 has been the result of switches
bonds.
Bank of America
40 Wall Street,
America will be the host at
It is reported that
come
York
honor
/
.
the
of
(International),
New
100.000
Old
anticipation financing
tax
Chairman and Assistant Sec¬
retary
definite
Gaulette, Confer¬
Pearl
Miss
ence
corporate obligations have been sold and the funds
released in this operation have been reinvested in tne 19^5 Gov¬
ernment maturity.
75,000
Bellevue, Wash, (suburb of Seattle)
by
lower coupon
Sq. Ft. Area
Mar., 1955
Illinois
recent
from corporate
Probable
Opening
the
obligation.
million- operations:
Estimated Date
of
R.
special luncheon at the Park
Hotel will be presided over
the
adding to their holdings of the recently offered long-term Treasury
store
with
more
a
in
markets, there appears to be a growing amount of interest devel¬
oping in the longest Government issue, namely the 3% due 1995.
It is indicated that quite a few institutional investors had been
solid
suburban
construction
"know-how"
in
and
something of
3s of 1995 in Demand
The management enters upon
following schedule of new
store
there is
sell-offs
Conn.
Younger
Agnes
A
Despite the tightness which is still prevailing in the money
the
made to modernize the Chi-
until
rallies and
limited
Na¬
Company,
Lane
feeling of confidence, because of the new highs which
a
these securities.
tax.
the
than
more
Trust
phia, Pa.
of followers in .
the Treasury.
Intermediate term obligations are still not doing very much, even ;
though there have been reports of a minor pick-up in interest in
spite
income averaging only $979,000,
or 24 cents per share after a 52%
1929,
sensitive
The short-term issues continue to have plenty
aver-
Frederick & Nelson, the largest
department store west of Chicago
In
rather
a
registered by this bond.
were
aged $38 million annually in the
1949-1953 period, operating results
were
disappointing with pre-tax
years.
be
to
coming from the monetary authorities. The market action**
the recently offered 3s of 1955 has given the financial com¬
of
of
sales of the Fieldcrest Mills
continues
nature
of air conditioning all sell-
floors
much
be
not
Government market
Washing-
promising.
very
will
the main Chicago
store will be completed in the
spring of this year,
With the sale of the Fieldcrest
Mills on Sept. 30, 1953, the Marshall Field management disposed
of its last non-department store
enterprise and was thereby freed
to concentrate its energies on the
business it knew best. Although
ing
department
considered
Bellevue,
in
market
affair, with the action of the equity market still having a noticeable
effect upon the trend of quotations of Treasury obligations. When
the pressure is on the stock market it seems to be off the Govern¬
ment market, and vice versa. However, it appears as though there
North West, the future sales potential of the two Seattle stores,
including a proposed new subur-
day.
Government
First
The
of
and
Generatiori" —Martin, Assistant
Vice-President, The Philadelphia
Saving Fund ' Society, Philadel¬
Miss
of
established
were
"The
By JOHN T. CHIPPENDALE, JR.
was
upon
Bank
Ridgefield,
Governments
on
Reporter
The Security I Like Best
concentration
41
(1533)
be
—
Personnel Di¬
Book-of-the-Month-Club,
(formerly
with
Dime
Savings
of Brooklyn).
"The Bank and Its Customers"
—Miss Aenes J. CarnalL Second
Bank
8c Co.
INCORPORATED
Miss Helen R. Feil,
rector
Aubhey G. Lajjston
15 BROAD
ST., NEW YORK 5
WHitehall 3-1200
!
231 So. La Salle St.
45 Milk St.
CHICAGO 4
BOSTON *
ST 2-9490
HA 6-6463
-
"
*2
(1534)
The Commercial and Financial Chronicle
Thursday, March 31, 1955
...
<' >
M.I.T. Growth
Mutual Funds
Fundamental
Reports Gain
Reports Gains
The
report
of
Massachusetts
Investors Growth Stock Fund, for
By ROBERT R. RICH
the
CANADA GENERAL Fund (1954)
Limited,
ment
largest Canadian
invest¬
Since the first
of the
the
moderately reduced invest¬
bonds and preferred stocks,
correspondingly
increased
fund
ment
States
owned by United
investors, reports total net
and
assets
of
Government bonds.
company
$54,739,825
1955, equal to $9.98
5,483,098
Capital
gains
distributions,
share, will be paid April25,1955 to
share
owners
in cash
or
Stock Series
as
$.14
..........
Stock
Series
.
.
Bond Series
*
19
...-
....
until
Sept.
1954,
bonds, according
the
report,
was
principally
longer term issues.
corporate
The
to
in
principal
common
stock
the report stated, were
Established 1930
•
tions
in
were
the
merchandising,
their
months.
'
ing from the original offering of
shares continued at
steady rate.
a
Steel stocks
ately
on
rising scale following
a
sharp
advance
of
recent
of
increase
$45,459,212
at
value
asset
net
the
period
net
a
$18.30
asset
a
year
value
share
per
ago.
in
c7/e
.«....)
Seory*
16
industry classifications
listed
in
are
the
quarterly report as
of Feb. 28, representing a market
value of $4-3,810,110, with the bal¬
ing at the quarter's close had in¬
PUTNAM
of net assets
ance
in cash and
re¬
Principal investments
by industries showed 13.87% in
oils, 10.86% in paper and other
forest
products, 9.97% in stores,
8.28% in public utilities, 7.97% in
SJjodton
mining,
the Union and in 37
50 Sute
The
Street, Boston
report states that: "As the
of
management
Fund
(1954)
that
as
Canada
General
Limited is the
for
General
same
the
Fund.
.former Canada
Inc., it may be of
interest to review the record since
Canada General
invest
Fund, Jnc., began
active operation on Aug. 1, 1952.
in
"On
ATOMIC SCIENCE
through
that
value
for
gains
distribution
$90
on
merger
the
FUND, Inc.
a
net
(on
asset
holder of 1,000
original
Fund
In
above
fund's
89th
.
consecutive
dividend, amounting to 17 cents
per
share, is being paid March
to
stockholders
of
record
Feb.
would
settlement and
cash
variety of
distribution,
net
companies participating
asset
Feb.
resulting
would
value
28,
gains
represent a
of
1955;
an
$12,312 as
increase
of
of
33.0%."
THE
$418
MILLION
Fund had 67% of its
vested in
TM FACTS AND FREE PROSPECTUS
STREET, N. W.
common
Wellington
in¬
resources
stocks
March
on
1, last, Walter L. Morgan, Presi¬
dent,
told
shareholders
in
the
iflVIC DEVELOPMENT SECURITIES CI
WASH!NOTON 7.
lists
report
net
Wellington's
assets at
$418,928,305 on
March 1, 1955. This compares with
$303,178,187 on the same date a
101st
t
D. C
Dividend
holders'
News
Report
and
made
Share¬
The balance of
SHARE
value
of
ing
Feb.
28,
1955.
holders,
this
in
trend
increase
the
to
business
that
fact
activities,
and
convertible
pre-
from
the
stock
prices.
The
sharp
rise
report
also
9,000
of
share for
per
that
enjoyed
the
income of 44
remarkably steady
the
American
Ftiod
&
five
last
937
$41,559,-
22,500
Corp
4,200
Corporation
Sprague
Co.,
Electric
Texas
Gulf
Texas
Pacific
Traders
TXL
&
Finance
Oil
5,000
1,000
Inc
5,500
Co
2,550
Producing Co.
Land
6,700
Trust
6,000
"A"
10,000
Ltd.
Corporation
Mr.
to
"stock
over
the
24,000
3.12%
at
which
stocks,
9.90%
latest
in
1953
year-end
from
of Feb.
accounted
4.96%
were
at
year-end.
Electronics
show a consistent in¬
1.57%
a
base in
1954
year-end
a
come
Funds
28, 1955, the net
as¬
10 Keystone Custodian
combined
amounted
to
Over
have
per
to
few
past
which
weeks,
effect
headlines, had no
the redemption of Fun¬
on
damental
Investors shares.
"We of your
board of directors
regard the lack of increase in
re¬
the
our
reflection
a
as
long-range
of
investment
of
objectives
shareholders and their feel¬
ing of confidence in the features
of
such
funds
mutual
Funda¬
as
mental Investors, the strengths of
which lie in diversification of in¬
vestments and
continuous
profes¬
sional management.
"During
of
these
1%
of
weeks,"
shares
total
deemed.
Mr.
This
the normal
is
were
re¬
approximately
rate of
withdrawal
of
funds."
Mr. Brady told the annual meet¬
ing that total assets for the Flind
as
of March 23, were $266,115,105.
This
with
compares
Inc.,
on
$170,327,717
day of 1954. Net
same
for
1950
position
of
time
Fundamental
Dec. 31
of
which
were
five-year period, in¬
dividends paid
by the fund
averaged 50 cents
Asset value
share
per
$11.58
on
from
rose
Dec.
on
share
per
31,
1950
Dec. 31, 1954.
per
share
year
as¬
Investors,
$256,249,343.
meeting
was
with
$13.73
$10.42
$13.49 at the
was
Group, Inc., provides a com¬
plete analysis of year-end holdings
of
The
Common
Stock
Group Securities,
past five years.
At
the
Inc.,
Fund
over
between
OPEN-END COMPANY
1954
annual
meeting re-elected
Fundamental Investors, Inc. board
of directors,
including Mr. Brady,
Chairman; Hugh W. Long, Presi¬
dent; Thomas F. Chalker, Secre¬
Julian
and
Roosevelt,
K.
117
the
Feb. 28, '55
in 1952.
During the same period,
holdings in metals were increased
This overall
1955.
out,
was
at the start
*
3.56%
2.40%
to
to
of
10.03%; oils from-
6.51%;
Building
2.46%
of
railroad
stocks,
stocks
portfolio
in
for
8.11%
Dec.
at
'
'
1
■
sible
participation in Canada's growth.
Send ..for a free booklet-prospectus by
mailing this advertisement to
mutual
fund
A
a
portfolio of
securities
selected
for
mutual
fund
as
as
large
.
-
I
Name
Address
a
on
■-*:
Month of
Fourth Quarter
January, 19;
1954
No. of new accumu¬
lation plans opened
periods-
8,769
8,618
20,462
undue risk
of
Affiliated
re¬
e
Fund
wi thout
A
principal.
Common Stock Investment Fund
Investment
♦
♦
*
?
*
♦
♦
♦
are
Corporation, 200 Berkeley St., Boston, Mass.
Prospectus
/
February, 1955
objectives of this Fund
long-term
capital
and
income
for its shareholders.
growth
Established 1925
Please send
-
Month of
AceumuIation4?bu>s:.-*
^
Auk.
308,701
307,903 >/-■;'
349,683 -;
INCOME
an
ob tainab 1
bullock
NEW YORK 5
$263,647
January1'•31;- 1955
M February 28, 1955____
whose
prime objective is to
turn
long-term GROWTH of
capital and income
The Parker
98,709
INCOME FEND
with
diversified
Established 1894
47,299
IICORPOIUTED
INVESTORS
A
37,998
$ December 31, 195&__„_
f& December 31, 1954
in
INCORPORATED
$270,594
*
t4
i
1954
$109,783
of|Caish, U. S. Governments and, Short-Term Bonds
31,
*
Fourth Quarter
January, 1955
$99,497
Redemptions-
1950,
largest holdings in 1952 at 10.57%
Month of
Month of
representing
the
■
the basis of pos¬
$6,109,390
February, 1955
Holdings
Utilities, which represented the
*
diversified, managed investment
Dec. 31, '54
$6,240,767
Sales of shares.
1954.
as
Jan. 31, »55
$6,453,899
1954.year-end, steel is¬
that
Government
pointed
same
Open-End Funds
(In 000's of $)
to-
accounted
executive
STATISTICS—MONTH OF FEB., 1955
of
Prospectus
□ Incorporated Income Fund
[~j. Incorporated Investors
upon
request
Lord, Abbett & Co.
>
v.,.,......City
New York
■>-—
Chicago
—
on
Net asset value
end."
tary;
RECENT report from Distribu¬
the
compares
March 23 of 1954.
The
the
year.
$8.09
$290,329,800.
fluctuations
market
made front-page
4.12%.
As
told ^shareholders
Brady
that
"Net asset value per share at the
Food
for
our
plan."
1954.
the
shares
under
quarterly
or
long-range systematic investment
sets
to
sharehold¬
accumulate
to
for the
down
additional
the
"Of
ers," Mr. Brady noted, "more than
1,000
represented
people
w*ho
Brady said, "less than four-tenths
Chemical Co
(Chas.)
Feb. 28,
1955 compared
$37,241,826 on Feb. 28, 1954.
on
sets of the
A
2,370 in the past two months and
one-half to a new high of over
15,000
Corp.„_
Chem.
Marathon
Pfizer
holdings
with
5,000
Sold
Monsanto
crease
were
30,000
Co
Corp
Republics
Mach.
tions.
assets
Oil
SALES
consecutive semi-annual distribu¬
net
America
&
common
noted
have
9,000
Company—
were
shareholders
cents
in
from 6.91% to 11.05%.
U. S. mutual fund designed to pro¬
due
was
11,000
Co.__
Co..
Coal
Petroleum
ferreds in the fund have benefited
ton
I
Address.
to
primarily to lower interest rates
during the period, the general up¬
investment position, the Welling¬
FUND
ONE WALL STREET.
Corp.
Keystone
According
from
about the
calvin
Oil
Pac.
Ins
Gas
Total net assets
public
resources on
and preferred stocks.
CANADIAN
on
Accident
Seaboard
Warren
the Semi-Annual Report to share¬
bonds, good grade corporate bonds,
a
&
2,000
2,000
Natural
12.3% in the 12 months end¬
rose
divided
vide
Life
Republic
9,900
Prod
Co
Electric
Income Preferred Stock Fund K-l
date, Mr. Morgan said, was in de¬
securities, about equally
ia stocks selected
Nat'l
35,000
Texas
represented the largest per¬
centage at 11.8%, up from 5.35%
fensive
a
Cellucotton
McGraw
Texas
PER
of
sues
day.
is
Bought
Co.
Sheraton
ago.
year
Inter
Oil
meet¬
tors
from Atomic Science.
tOtt THIRTIETH
The
total
re¬
capital
Company—
Houston
annual
demptions
PURCHASES
Aeroquip Corporation
Total
have
*
,
ing, Mr. Brady said that the num¬
ber of shareholders increased by
monthly
coun¬
Canada
ceived 1,224 shares of the present
Fund, plus $6.82 in cash.
The
shares received, together with the
managed investment
in activities
the
to
paid.
was
respective
share)
of
General
designed to provide
a
Canada
of
mentioned
of
values per
in
asset
amounting
1,000 shares
basis
shares
ATOMIC DEVELOPMENT
a
net
1,000 shares
the
is
the
Fund, Inc. was approxi¬
mately $9,260. In 1953, a capital
MUTUAL FUND.
MUTUAL
date,
General
a
foreign
7.39%
in finance com¬
panies and 6.32% in bank stocks.
Putnam Fund Distributors, Inc.
state of
every
tries.
ceivables.
FUND
in
Investors
damental
started
with
2,484,150 shares
17,432 stockholders last year.
The
*
Speaking before the 23rd Fun¬
compared
of
located
are
board chairman said.
creased to 2,565,805 and the num¬
ber
of
stockholders
to
18,126
Wellington to-, 28. A dividend of 16 cents
per
taled an all-time high of 142,367
share" was paid in the same quar¬
on March
1, last, to rank the fund ter last year.
' '4 '
;
among the nation's 20 largest cor¬
Changes in the Fund's invest¬
porations with respect to number
ments during the quarter included:
of shareholders. These sharehold¬
ers
Wm.
60,000.
.
Holdings of 85 Canadian stocks
Fundamental Investors,
the first of the year,
Gage Brady, Jr., the Fund's
since
Inc.,
The number of shares outstand¬
and
new
funds,
per
on Feb. 28 was $25.87.
This
amount, together with a capital
gain
payment
in
December, is
equivalent, to
$26.44
compared
in
$10,000,000
capital has been invested in one
of
the
country's
large
mutual
over
share
25
Shareholders
28,
corresponding
The
1954.
reduced moder¬
were
of
Feb.
assets
net
46%
a
the
of
ended
total
assets
end
of
railroad, steel and textile groups.
and
total
in
with
that during the second quar¬
ter, investment of the cash result¬
.42
shows
$66,388,505,
selected
aluminum, building and
rubber stocks bought for their fa¬
vorable near-term earnings pros¬
pects or long-term growth.
The
principal common stock reduc¬
months
three
1955,
purchases,
former Canada General Fund, Inc.
.
Broadway, New York 5, N. Y.
The reduction
ing the first quarter of operation
the Fund acquired, through mer¬
ger, the investments held by the
NATIONAL SECURITIES I RESEARCH CORP.
120
operations
In the current report,
Henry T.
Vance, President, noted that dur¬
.20
in
not
be¬
following the original
offering of its shares in
August at a price of $10.
•
34
Growth Stock Series
are
the Fund did not
as
active
1,
08
Balanced Series
v
of
outstanding
Comparable fig¬
public
12
Speculative Series
Preferred
gin
28,
share on
per
previous periods
available
follows:
Income Series
for
ures
of record April 7.1955,
shades,
shares
stock.
common
per
Feb.
on
year,
than
More
Atlanta
—
Los Angeles
}
-
Volume 181
Number 5416
.
.
The Commercial arid, Financial Chronicle
.
(1535)
43
(
William
Smith,
H.
Roger
J.
ence
Lough,
Solwin
Tuckerman,
Reese
and
T.
Clar¬
Kennedy
Public
Stevenson.
A
50
PER
value
its
CENT
gain
during the first
present
made
Fund
of
The
Group
in
under
year
was
expanded
the
and
new
Every
from
shares of leverage closed-end in¬
returns
vestment companies, although
management's choice 22% of
rect
current
vested
holdings
in
are
in¬
now
20%
lower-priced
is
stocks
invested
in
and
in
54%
Management of the fund can
adopt a defensive policy in hold¬
ings of more price-stable stocks,
preferred
stocks
and/or
bonds
during "periods of uncertainty or
decline, when conservation of as¬
produce
may
buying opportunities
the best results."
Current assets of the Fund total
$4,339,968,
with
467,393
shares
outstanding. Asset value per share
March
on
15
186,306
with
total
net
assets
of
earlier.
the
quarter,
purchases
to
do
stitutional
advertising
may
the
define
to
ally keep their
lic
will
eye
cure
to
portfolio
of
1974
Gas
direct
ing
that
and
Trans¬
about
go
can
it
be
that
Some
also
Corp.,
Interna¬
Canada, Ltd.,
Ads that
rity,
Securing
Specific
offer
either
Don't
rity,
offer
a
coupon
than
the
fancy
it,
If
give
and
a
wish to
you
security,
the
the
name
of
offering
price,
Suggest one
or
two compelling reasons why
you believe the offering to be at¬
company,
current
tractive.
return.
Don't talk down to any¬
The less
asked to read and
are
the
con¬
better
they like it arid
apt they are to be .in¬
more
to
send
for
infor¬
more
you
Coupons—Always put
on your ad and play up
pons
telephone
number.
Ask
quiries and make it
cou¬
your
in¬
for
for
easy
peo¬
through
radiation, cold call, or
direct mail, you can do the
by
with newspaper leads. Don't
same
become
into
type
will
less
for
a
and
use
will
and
the
"live
a
ads
mill
look
white
more
financial
of
positors
State.
large
hardly
any
white
at the top and bottom of
ads. Insist on smaller type,
Some
run
invariably
too
leave
lead,
Name.....
Addrcu..
is
that
your
u-iL J
wasters.
and
space.
made
up
newspaper
by
com¬
like announcements
stock"
sale
instead of
and
Use
the
Styles
Type
Same
nity and
refinement
vertising.
Obtain
benefits that
by
•
BANK FUND
•
using
FOUNDATION FUND
come
the
to
Ads
from repitition
layouts
same
Won't
Sell
You
fry
going to be more trouble
than they are worth.
Remember
Too
in
that
be
can
caused
selection
the
of
local
Sometimes
not
are
in
a
your
pull
names
In
locality, A. T. & T. brought
many small investors that
one
in
so
the
ad
other
than national issues.
discontinued.
was
city
Telephone
Find the ad that
and stick
pays
will
be
an¬
advertising
profitable.
was
In
to it.
These rules
but the
best
one
is stick to it until
of all
helpful
you.
find
combination
along
those
in
off
pays
then
lines.
two
or
for
tising
and
purposes
to
good
will
accounts
lot of advertising. The
of good financial adver¬
continue
Persistence
advertising—but
if
advertising is not bringing
results
change it until it does.
What may work well in Dubuque
may not work out in Keokuk, or
Shreveport.
your
Kin-Ark Oil Stock
is
to
build
up
your
name
to
help you screen out
likely customers. Learn how
sift
the
wheat from
the chaff.
By using the telephone you can
become
acquainted
with
many
LTD.
6. N. Y.
good prospects-Follow these
be obtained from
ple by mail, invite them
local dealer.
office.
and
will
/
Get
start
from
to
to
drder
from
develop
their
an
there.
Many
peo¬
your
them
good
people
The
four
operating
Arkansas Power &
nated
electric
system for about 28 years.
power
A
closely coordi¬
interconnected
and
operator
system
Bluff,
Ark.,
part
Pine
near
controls
the
of
the
system
major
generating
facilities, using the most
econom¬
ical combination of power sources
System
serves
ranging
a
from
of
the
northern
southeastward
compact
Ozark
Arkansas,
the
across
Louisiana.
This
rich
territory
has
a
wide
sale of
enjoyed
the
years
lion to $120
oi
180%.
million
This
increase
or an
has
involved
a
erating
of
new
steam
gen¬
units
constantly increas¬
in 1953 four units of
105,000 kw each were installed,
and
in
1954
three
135,000
kw
units were under construction, the
third
to
be completed
in 1955.
Thus
ing.
next
major
round
of
gen¬
business
of
acquiring
oil
System
of
kw
423,000
prop¬
erties,
principally in Arkansas,
Montana, Louisiana and Colorado,
and in exploring and developing
them.
It also produces and sells
oil and gas from wells located in
Arkansas.
In addition, the com¬
pany
the
located 60
the
com¬
Arkansas
company
tial interest.
which
owns a full or par¬
According to a firm
consulting petroleum engineers,
estimated
net
company
ing
as
producing
of
of Nov. 30,
barrels
reserves;
of
reserves
barrels,
1,414,565
1,152,775
rels
proved
1954
compris¬
of
proved
130,540
bar¬
proved non-producing re¬
131,250
and
serves,
proved undeveloped
The
company
of
reserves.
presently sell
its
of
to
Feb.
various
15,
companies.
As
1955, the posted field
service
and $2.75 per barrel.
Upon completion of the current
financing, outstanding capitaliza¬
tion
of
a
of
the company
$300,000
bank
455,000 shares of
completed
generating
new
last
year
another
brought
352,000
kw.
addition scheduled
kw. This compares
System peak load
2,165,000
with
1954
the
of 1,709,000
System
kw, indicating that the
has ample reserve
now
capacity.,
In 1955 Middle South
expects to
spend about $51 million for
con¬
struction, of which $29 million is
for distribution facili¬
earmarked
$14 million
transmission,
ties,
for
generation
pany
order
will
note
common
consist
and
1,-
stock.
com¬
case,
Commission
1944
earn
6%
estimates
Dixon
earnings
below last
the
$2.15
at
on
1955
$2.20
to
in
will
preferred
&
P.
L.
be provided by
stock by Arkan¬
and
the
remainder
bank loan. Arkansas is
doing a big refunding pro¬
through
a
its $6 and $7 preferred
stocks are to be exchanged for a
gram
—
issue
new
basis,
bonds
on
the
and
will
be
an
$18
underwritten
million
refunded.
4*4%
Middle
the credit for
cents in
financing
can
be
deferred
Middle South has recently been
been
has
since
appears
there
management does
not
ex¬
pect the System to grow quite so
fast in future — it is projecting
growth at ,an annual rate of
compounded for
The very high
of growth in the past few
increase of 8V2%
the next few years.
years was
it
little
a
will
be
was
times
$1.10.
doubtful
that
increase
an
It
this
with further improve¬
earnings another increase
but
year,
should
be
larly if
cided
forthcoming,
the Arkansas
particu¬
case
is de¬
favorably.
£- Middle
South
Utilities
has,
of
involved
deeply
been
in
"Dixon-Yates" issue in Wash¬
ington, having
80% interest in
to
Arkansas to
firm power
an
construct a big
near West Memphis,
supplv 600.000 kw of
project
steam plant
is
four
increased
when
1949
for AEC, via TVA. It
to rehearse this
unnecessary
story, which has been covered so
thoroughly in the press (see this
column for Nov. 4, 1954). Despite
a
vast
tion
amount
the
of
political agita¬
with the
utilities,
two
strong support of the Administra¬
are
actively proceeding with
President Dixon of
project.
Middle South Utilities covered the
topic thoroughly
dress
before
the
in
a
New
recent ad¬
York
So¬
ciety of Security Analysts.
for
time.
The
on
stimulated by the sharp
>
selling around 34 and paying $1.50
to yield 4.4%. The dividend rate
the
parent company bank loan may
be arranged, in which case equity
interest
construction.
tion,
and in order to provide
$20 million equity money over the
next
four years through
1958 a
in¬
an
charges
amounting to about 22 cents a
share, and a decline of about II
South itself will not sell any stock
year
includes
depreciation
the
million
re¬
year's figure. However,
estimate
1955
crease
will require only about $15
of new money of which
sale of
rate
appealed to the
flecting the rate increase. Without
that increase earnings would'dip
the
program
million
load
be
the
President
share
this
construction
The
also
Court
investment.
course,
sas
being
County
the Commission,
allowing it to
1953.
$8
will
on
and $8 million
expansion of natural gas,
transit,
etc.
This
construction
budget compares with $61 million
spent in 1954 and $88 million in
for
year
is
Supreme Court. The
thinks it has a strong
ment in
and
application
it
but
If this lower
reverse
issue
last year re¬
Pulaski
the
to
Circuit Court.
State
being collected
are
increase
not
Power
The Arkansas Public
company's
the
in¬
from
Arkansas
Commission
this
the
income
of
rates
appealed
does
this included
1953;
net
Light, which
for
one
some
completion this summer will
total generating
capability
some
price for oil ranged between $2.40
of
under bond.
this
barrels
output of crude oil at posted field
prices
to
are
producing oil wells and
producing.gas well in
-one.
of
in
a
of
On
gas.
leases
plant
gasoline
operates
extraction
natural
pany's
the
and
owns
least
for
raise
leases
and gas
&
in
$2.06
cents
last year
compared
share
per
which would include 29 cents
the
1953
for
prospective
14
$2.13
prudent
York, will be used by the
of
South Utilities
Middle
earned
the expected load growth may re¬
year
over
than
are
some
other southern utility executives.
based
each
less enthusiastic
seems
possibilities
erating units commencing in 1958
will be still larger, and thereafter
The Chase National Bank of New
the
year-round resi-r'j
cooling is be¬
ing explored, though the manage¬
jected
size
con¬
for
pump
with
the
expected to
dential heating and
Service
The 135,000 kw
com¬
heat
tremendous
from $43 mil¬
is
which
load-
current
continuing growth
air-conditioners, a
of
tinue, probably at an accelerated
rate, in the next few years. The
economic feasibility of using the
tremendous construction program,
into
outstanding
trend
big
the
is
use
creased
revenues
the
of
the
in electric
ceeds
discharge
spectacular, but satisfac¬
builders
in
growth
South is continuing
pace.
with
capability and
to
tory,
growth, the load increasing at an
average rate of 14% compounded
annually, with a postwar increase
the stock,
of
less
a
its
In
together with the pro¬
a
loan of $300,000 from
at
industrial
The
customers.
ment
has
now
of the Middle
fresh river water.
During the past nine
plants. The
serving virtually
customers in its
territory and is dependent prima¬
rily on new construction for new
variety of natural resources,
including
an
ample
supply
of
System
is
other siz¬
of
number
a
the potential
One
lands
of
the
Mississippi
delta, and down through the Gulf
Coast
plains
of
Arkansas
and
share.
proceeds from the
System
all
available at any one time.
unit
per
new
and
been operated as a
installation of at
price of $2.75
important petro-chemical
and enlarged pulp and
mills, oil refinery expan¬
plants,
plants,
manufacturing
and
Mississippi Power & Light—have
quire
a
cus¬
location of a
number of large industrial plants
in the area—large
aluminum
the
able
Service
time.
at
of
number
the
by
sions
Public
large
stock
common
in
and
paper
Orleans
Van Alstyne, Noel & Co. are
offering 500,000 shares of KinCo.
tomers
New
Ark
Oil
increase
Light, Louisiana Power & Light,
The
At $2.75 Per Share
a
also
million
gas and
farm
by
securi¬
issues
$144
—
Mountains
Eggs
leads
many
too
Getting
China
of
a
with
electric, 10%
transit.
area
are
one
for various
seekers and
telephone
out.
Are
Many
were
You
the
who
Distributed by
or
run
6%
subsidiaries
is
company
revenues
The
If
the
for
the
some
may
and
Use
purpose
the above
valuable
telephone and eliminate
curiosity seekers and small
FUND
INSURANCE FUND
Prospectuses
ad¬
your
the
leads.
pay
i
dig¬
type styles constantly.
INCOME FUND
HARE'S
type
a
lends
Learn how to follow
19 RECTOR STREET. NEW YORK
Border
Pick
—
border that
style and
investment
you
the
Use
weed them
for
sale of stocks.
Always
Funds
if
curiosity
many
time
from
Mutual
discouraged
pany
so.
agency
9, Mass.
space
•
accounts
notes.^and a related mort¬
Buy
Enough White
Space —
gage^ Jto drill 14 additional wells,
Don't jam your ads full of copyi
"arid for addition to its
general
The
newspaper
type setters in funds.
most cities where you don't use
Kin-Ark Oil Co. is engaged in
an
describing
•
becoming
bank
Organization *nd the shares of your
GROWTH
other
use
of
cultivate
can
Net
Use
often
•
order,
friendly such as luncheons,
offers of service, reports, etc.
If
the
Pick
certain
a
first
methods
by
more
mation.
Keystone Company
.
secu¬
one
verbiage.
block of
a
and
the
BOND, PREFERRED AND
City
a
information.
Try to Be Clever—Leave
sensible headline.
the
nation¬
than
more
well
is
results
of
secu¬
idea in any one ad.
or
Don't
out
better
annual
you
Utilities
holding
—about 84%
the
ties that you are offering
or
carry
offer
fluenced
COMMON STOCK FUNDS
prospectuses
that
southern
only
in
from you
mail.
After
my
South
pur¬
js
them
better
that
one
order
Get
after
hearing
and
standard
ads.
Situations-—
locally
that
ple to do
Funds.
of
have
first
opener.
phone
you
New
particular
a
especially
known
sider
Custodian Funds
ten
if
Advertising
Advertise
people
Keystone
your
habit
you
first
one,
=r=
me
This
door
with
their
made
productive
the grocer sells cabbage.
Please send
chase.
a
them.
achieved
for
business
have
leave Out the statistics and
financial lingo.
Sell stocks like
and McGraw Electric Co.
The
do
they
advertis¬
properly.
Rules
offer
were
will
might
to
from
Middle
flaw
offer
eliminated from portfolio, as were
the
common
stocks
of
Chance
50 Congress Street, Boston
over
the pub¬
there are
come
results
also
different
A
tional Nickel Co. of
find
not have otherwise
1973.
mission 3%s of 1972 and
Aircraft
in
name
underwritings,
The
during the quarter Tennessee Gas
Vought
but
occasions
when
it
has
hepled them to make sales, or se¬
bring
large number of
utility preferred stocks
times
be
many
general
$207,000 and $1,875,521 respectively.
3%s
at
in¬
the firms that continu¬
years
will
totaled
Tennessee
with
from
curities
Transmission
business
more
The returns
and
eliminated
of
di¬
Placing your
atregular
it
possible for
makes
ally,
fund, added
kinds
advertising,
indirect.
sales of investment securities
other than U. S. Government se¬
and
The
two
are
all
their
them
pay
less effort.
$33,-
$33,821,000 three months
During
make
before the public
SHARES
Feb. 28, 1955 compared
on
to
that
me
Accounts Through Newspaper
AMERICAN BUSINESS
reported
There
intervals
$9.27.
was
tell
advertising
from
and
name
hard
spceial growth stocks.
sets for later
profit.
a
who
unable
are
newspaper
you
these securities.
Another
often I receive letters
so
readers
they
its
Middle South Utilities Inc.
Newspaper Advertising
name
adopted on Feb. 24, 1954.
The present
fund, unlike its pred¬
ecessor, is not restricted to the
by
By OWEN ELY
By JOHN DUTTON
Securities, Inc.
Originally known as Investing
Company Shares, the fund's pol¬
icy
Utility Securities
asset
and policy was
Capital
Growth
name
by
'>
W.
Two With Samuel Franklin
(Special to The Financial Chronicle)
LOS
Fox
ANGELES,
and
affiliated
,,
Calif.—Robert
Henry Lee have become
with
Samuel
B. Frank¬
lin & Company, 215 West Seventh
Street.
*
The Commercial and Financial Chronicle
(1536)
44
Continued J
from
3
vaae
^
y
exerting
*
interest rate, there are some
any
m II
1
F K Alin
A A1 C&1IU
IVCaUUIlMWAlliy wl
A
sw
fti
the
eral
eompanies,
the
to
so-
and
System.
a
er
provide examples in the field of
investment
banking;
doubtless
commercial bankers can cite nuexamples of their own.
not willing to be taxed to pay for
the cost of the war as it was being fought, and the generation of
a
large increase in public debt
^eatest aid to iniiation tnat we
hag
gerye
^dollars
rrom one
y
f,af.
inflation,
more
created, a greater
are
tary control.
being
[han
.g likely
during the war, and thus make
possible more increase in credit
alio-
to cornG the best
than was necessary.
the
After
j|ow About the Federal Reserve?
£)oes
the
maintaining
for bonds
market
artificial
an
cation of resources.
,
ques-
may
we
did not go too far in
arrangement
any
rationing; and from
for volimtary
-t
less personal
with
^ carried out
amount of deposits is owed, and
But
Reserve
Federal
that
standable
under-
was
would
consumers
had had to
the things they
want
ever
it
war
mark
^orld
gince
their
War
French
destruction
j
similar
and
havfoccTred
Wgr
Jf
n
Congress
£0 pass 0U£ aid £0 various
groups
pressUFe
tarian
the
and
t
went
World
ft
iraPersonai as possible and can tion whether the Federal Reserve jg going
as
.
&erman
f
al Re. presented the problem of mope-
advantage ot
the
favoritism
P01"! 01 view'
could welcome
loaning officer at his
for
bonds
^ control by the Fed
,
seem to be his concern,
corpora-
Reserve
Banks can do, may be nullified by
tb^
j Sta;es Governme:nt itset*. A budgetary deficit is the
dollars to a dePPsltor, and wnat
those do 1 lax s will buy may not
sav-
governments,
Federal
the
to
peacetime. The Federal Reserve
cannot be held responsible for
this. The American people were
quired to pay a'certain number of
nomberot
of
they have ample supplies,
which
But
business
their
sell
tions
P^ventmg iff
insurance
associations,
non-financial
Attitude
.
tor
Should he pi event it or try to do
banks,
savings
loan
and
ings
it
achieved
be
p
of
buyers
a
added
be
,
attitude toward iniiation and his
digression, it should
that the same results
As
bonds.
will
residual
the
be
to
.
R
®a"kcr ® \r°V"
^ a should be the bankers
consent
will
Banks
Reserve
preferred stocks
period of low rates,
iow_jnterest
Q£
in the recent
there .is capacity
inflation if the Fed-
large
a
curbs
But dll that th?, bank? can do,
and all that the Federal Reseive
to
iesSj and the substitu-
or
higher-dividend
banks,
Nullify
Tan
Government
the production of the
accustomed
commodities ol
^,yo
sayG
Administration.
gov-
needed to protect the dollar.
orecludes
The refunding of bond issues
■
,
.
serious indictment of the Truman
bonas now held by com-
ernment
mercial
for
of
amount
large
chasing power in the production some plausible, almost convincing
excuse), so that extra care is
of war material, which purchasing power cannot oe spent on
civilian goods because the** ca-
rate-they would g0 & t°„£ S"
'
,
„
the Federal Reserve in March,
1951. This induced inflation is a
as
with
A#aill\vlk9
tiom
firms on the margin of doubt
about carrying out a project. At
a higher rate> they would postP°ne or cluit tbeir Plans» while at
Avoiding Inflation
v,
long as the bank has asjsels whipn
the market or the
Federal
Reserve will take, and
go on
WAUkPTQ
ill"
f
1 ■
•
f
*>
f
tv fit
Bli%B
D Af MAMCl
Thursday, March 31, 1955
icies and had the same old infla- control credit have been progresWar always generates pur- sively weakened (each time with
at
However,
pressure.
•
•
...
on
humani-
one
after another, we
cannot expect the dollar to hold
its
pretext
vaiue. These
government pro-
grams are certainly inflationary
if the budget is not balanced, and
may
*be
so
guarantee
if it is:
of loans;
government
lending by
loans are made, all as®et^ need to be reminded of its duties? do without, and the temperament governmental... agencies
(would
ations.
The
and liabilities rise in total, and This
a
hrash question to ask
of the American people is such Congress or an administrator of
ulating inflation to a significant profits increase. This greater lev- and a di££icujt one £0 answer. that they want what they want such an agency ever link this with
degree, yet the officer is simply erage on a small common stock ^ie 0££jcers and S£a£f 0f the sys- when they want it. It is under- the general credit conditions?);
lending the bank's deposits and equity results in higher earnings tem haye a wealtb of statistical standable too that business men gifts or loans to foreign countries;
Accommodating customers.
available for surplus and/or div- and quaijtative information at would want to take advantage of farm price supports; stockpiling
idends, and stockholders benefit, their disposal, and should be able this enormous pent-up demand, of metals or other goods, whatremote considerbank may be stim-
desk, these
are
„
Purchases
Banks
„
Government
of
Bonds
the banker
But
in
inflation
to
United
the
sells
contribute
another
States
If
way.
Government
directly
the
to
commercial banks, this too
results
in creating credit out of thin air.
The bank debits an asset, bonds,
and credits a deposit account, the
United
chasing
ist
a
Government.
States
before
a
ex-
exists by virtue of
now
stroke of
Pur-
which did not
power
(or some^finoo-
pen
dling with I. B. M. cards), and the
government can write checks to
its bills.
pay
becomes
bank,
sell
or
ratio
reserve
limiting factor, the
before
can rediscount
with
from
If the
the
Federal
bonds
it
to
the
on
Federal
it
Reserve,
borrow
or
bonds.
Thus
Reserve System
the
through
aid
the
to
When
Government
to
their
the
sells
individual
bonds
Savers
purchasing
power
mcnt
and
the
what
directly
to
cor-
inflationary
no
influence.
States
and
savers
porations, there is
spent,
commercial
United
transfer
their
the govern-
to
they could
government
have
spends
banks
ot
customers.
Their
legal
li-
ability is limited, to the -number
of dollars owed. But is there not
a
moral responsibility
e
welfare of their clients. If they
seo4he values ot their savings
-
jog eroded away by nig:hei anr
higher prices, should they
e
merely passive observers ol unwise policies which are hurting
their customers..
If a banker admits to responsibility for the welfare of his cus-
to know when to encourage
The
expansion
flooded onto
^
a^e
Lowering
and
rate
and
buying
favorable
re_
bonds
create
to
an
in
the
do
wjsb
n0£
to
borrow
the
auy10ritjes
rediscount
gerye
iUi
ratio hi
g
and
"Ln'-ingTstem amou»ts'
in
bonds
a
Or
"ofits
whfnl?
bv
k
t
elvine
Lid
Rnt
services
the
so-
for which it is paid. But the so-
^a
«lk
a„'7nJ
is
o
Lod
hv
the
direct
n°nfitahle
man
flow
of
that the increase in capacity and
later
there
with
deposits
by sale to
Federal
Of
Reserve
The
social
ooiective
building
re-
Reserve
they
bonds
handle
as
gov-
directly
them
an
the
bond
banks
to
the
as
this,
that
room
for serious
United
the
there
States
pressure
do,
account
considerable.
If the
System
puts
to
buy
offered, to keep up
their prices and to keep the interest rate down, the Federal Reas
then
serve
becomes
the
residual
buyer, taking everything that the
of
rest
sorb.
the
And
surance
a
market
will
whether
it
is
no<
ab-
in-
an
company, a sayings
bank
assSon
savings and loan
or
non-financial corporation which
sells
bonds
to
the Federal Rea
serve,
IX
the
the proceeds become
legal reserves of the
m^rpiaL.banks,
basis
new
This
for
new
lending,
scal^ orior io
tha
and thereby the
deposits, through
by*
ha opened
irnif^
ex
greater
a
on
the
sum.
significant
a
arrord
f
t*
otates
'
part
com-
hpfwppn
j
.
ol
the
'
i
'
-
'
'
government bonds
saving
and
banks of the nation decrease from
3101.2 billion on Dec. 31, 1945 to
billion
$68.1
June
on
similar
while
80,
holdings
1953,
the
bv
companie^ de^
insurance
Ufe
Though the system could definitely curb an inflation, it is po-
tire
resources
the community
of
condition
of
the
is
country
to
rose
billion
$25.6
to
^ works. Whoever gets the bene*
flt of one program, it is-at the
expense of other taxpayers, and
because- government bonds are
bbf y*
eventuate, the basis for
lnBation is laid,
President
Eisenhower's
proposed highway aid is quite unsound. Creating a separate agency
issae revenue bonds roay
to conc.eal the issue, but of total
expenditures, however mampu-
oar?
were
budget
of
the
tried
Fran?l
the
Sf^|e„S?S«we^e^aOT^pecliency ot segregating extraor
deS " 7 beHeVe)(
havf sound
hn:,
__t
all
bankf/id
th_
hnnrk
"0^
the
franc con-
thev
can
who
can
economists
coun-
a
constrictive
one.
Yet the
Fed-
was an active force
when the prosperity of the 1920's
customers, have the effect of pilin= demand upon demand tor collapsed into the worst depresscarce productive factors, so that sion in our history in the 1930's,
Prlce? nse faster than production
and
when
it
did
take
faltering
bank' " Soclfy ,needs an orde+riy ket for government bonds. That
development of resources; - the the war effort must come first
bank wants good loans.
was beyond question, but need all
Right here is where the Federal
Reserve System holds the balance
prudent controls be cast to the
winds-in an all-out effort to win?
And in the postwar period, ineluding the early part of the Ko-
com-
heinff thp
hv
re
and oppresses those on
at
Sfte
unsound
thpir
Then
incomes
Used
ca/publicize
mpanc
the insurance
Z
hoiding bond
the
vestments
relatTvelv
.
over
31,
obviously the Federal Reserve they
fun-
try,^likewise accommodating good eral Reserve
Dec.
on
1953.
nation, both human and ma- damentally
sound";
etc.,
etc.,
•
nld
hut
terial. The loaning officer work- assail
the
authorities'
ears
as
"
mg at his desk may just be serv- pressure groups are threatened by s
poiRy of
ng a good customer, but
ynamtj
any change of policy, especially
through every
the
disnosal
im-
ultimate
and
The "Guaranty
programs
Sur^y"%Shed
monthly
by
Company,
^ 7elds down it encoura"ed New York, has an excellent lead
business holders of the bonds'to article each month written in a
eP
t
d
make
forms
which
v;Gidq
p»v
t
*
d
forces
nd
it
investments
nromised
doin^
the
materiallvoided
beservG
f]ationarv
_
pr ces uo
•
which
vet
to
bp
of
the
in-
increased
si«nifioantlv
Drices
^^iiGV
in
higher
Federal
sefn wi1Gther
cr^t hnfnot
the
and
S,arkets
equipment
than
!?anv ftls cln
of
tify in the event of
Trust
language all can understand. But
It is read by too few. If all banks,
individually and through their
associations, and
all
insurance
companies would carry such brief
analyses in leaflet form (Walt
Disney could helP out herc)» to
depositors in-monthly statements,
to
plant
Guaranty
stockholders
dividend
with
th! uhecks and periodic reports, to
borrowers along wltb tbe official
we
l!t-dow! i! papfi"\and to P0licyholders
a
bu^^GSS indeed the futo?nobii! co"ldu bave
educational force
Sst^' is nroducins !t the raf! ^hlCh- W0Uld demand sound
™b 5 Sllion
anLally Vht financlng^el^
Also, banking associations
cw-s
tho<?p
' "JId
:n
d
thp
5 7
inrhistrv
mXn
hsvP
rm+
'
sbould lake
up
After
the work.,
all, what we want is the sound
all
goods anfet services
rean
police
action,
when
the er?V,.eaer,ve Syst;em wben lt wa5> produced at greatest efficency and
United States Treasury dominated established was to ease seasonal lowest cost and offered at prices
tion of the rediscount rate, the the Federal Reserve's open-mar- factors wtneb sometimes led to people can pay. Inflation may
raising and lowering of the legal ket policies, the system needed
mg short; seem to stimulate business at first,
minimum reserve ratios, the pur- strong reminders of its duties to ?
dating paper and but it is hard to stop, once begun,
chase and sale of bonds, and by free itself and to follow a differres?r?esTo
f"d
,^^ong run, itis destrucmoral suasion and pressure, the ent policy.
It did so finally in them over stringencies Then with
■ All financial[ mshtutions <c n
system alters the reserve posi- the accord of March, 1951, but by
the emereercvDast the credit ex
d° 7°?
turns of banks and changes the then, th?'damage- had been done.
ion was rePers'ibie
But with
:ew^|als
costs of borrowing.
For many Again, too little and too late.
short-term paper less important,
power and provides that contr°l which no bank, in the nature
of things, is in a position to exert. by itself. By the manipula-
and
'
A fading purpose ot the Fed-
orderly
developrpent; of
our- resources,
.
businessmen the-cost of borrowHindsight enables *us to look and with government bonds as
u
t t
A JJ
S Is s<3 unimportant that they back and to see that in the Revolu-. collateral on advances, the credit
■i~T« llCIltZ /VClCIS1.
W1\I borrow at any interest rate, tionary War, ' the War of 1812, expansion is not necessarily re(Special to the financial chronicle) ;
Rejec^oa
such, applications the Civil .War, World War I, versible, certainly not automatiLOS ANGELES, Calif.—Murray
°,y answer in sueh World War II, and in the Korean cally so. Moreover, in the course Whitman has become connected
7
?
tbe bariker may episode, we made the same mis—of more than 20 years, the safe- with H. Hentz & Co., 9680-Sa|ita
..
j
lreaiury^ and do tnat if the Federal Reserve is takes in fiscal and monetary
i
f
commercial
by
inflation- and » Is both easy and ceased their holdings of governjudicious to be conservative and ment bonds from $2.2 billion on
debiting
Government
the
on
bonds
is
subsidies
reason;
tate to adopt bolicies which mi§ht creased from a hiah of 521.6 bil- regular'budget but the
p.lunge the economy into depres- lion in 1946 to $9 8 billion in 1953. tinned to deteriorate.
to litloose the^foSe
or
of The Federa
ReservT B^nl s into detenoratt
and
inflation.
j
held
a sharp inflation
can. lncrease then the banking steps to curb speculative excrediting system is not fulfilling its obli- cesses,
prominent people critithe United
States
Government's gallons
properly
By inflating cized it, although the criticism
deposit account.
A
Federal Re-' prlces' elt lf'mfhcting loss on the
should have been that its efforts
serve Bank must
keep a minimum many ;°rthe benefit ofthe few. were too little and too late.
legal reserve ratio of 25% against "ere. ^ th® conflict: What is to
Again, during World War II,
its deposits,
but the actual re- .tbe interest of society is not to the system facilitated the grantserves are so
much greater than
«ie interest of the individual mg of credit and sustained a marcommercial
accom-
of capacity.
up
Th
iarge
or
loaning officers all
Federal
may
sells
ernment
ex-
Banks.
the
be used
inflation.
If the
of
them,
ere-
outlined,
borrowing from, the
or
itself
engine
same
the
mild' Besides this, political con- Dec. 31, 1941, to $24.2 billion on see the evils oP inflation which
nromihir hecaiise even
siderations are not to be ignored Dec.:. 31, 1945, then decreased erode the values of insu an^e of
which are profitable
because,
though (he Federal Reserve them to $18 8 biUion on Dec 31
a[l kinds Jnnuiti es and penar"°n= otner th»>bs, thej satisfy js supposed to be above poIitics, )946 and from there fhe total all
a n u 11 les ^Pjn,
in
increased, followed
course,
System
the
before
deposits created dr
new
tant
is
as
been
have
with
less
strain
and
smaller increase in prices, and
with less danger of over doing the
plished
en-
on,
ever -
enternrises
into
ation of credit
could
output
S'SL6;')' ofhfbe vTt* best'iSoSsTwemaivatntageiZtehl° en® 0i "Don ^"Popular to boat"; Cries
"^-7 t rock the do so. "The
the hands of the banks
best possible advantage the
come
a
restraining control through
open
market operations, so
its
raise
to
legal
Here the Fed-
might have held
more
and
h enough and were
|u
t
vvished
rate
Reserve
eral
bankers are hesitant to lend, with
depression on and markets sluggjsb> this encouragement may be
jnef£ec£jve
Qn the other hand,
trie
power
market that could
a
in price.
increase
ex-
papsjon 0£ credib bpt if business
men
buying
increased
shipbuilding and ship operation,
not step up the output of civilian and to aviation; and aids to state
goods proportionately in a short and local governments for roads,
time The only result could be an hospitals, schools, and other pub-
rediscount
minimum
market may
open
concjiti0nS
credit
discour-
to
the
j
le
the
raciQ
gerye
when
and
Probab'y be-brought to an
has'a r?ei resoonsibility The could maybe to a preclpitate and
furthe lesponsibility
in.. end>
immediate purpose ol a bank, as disas£rous erd
ynaio Responsible officers justly hesiother■ bi«n«» ™t.tuUou.
set up
is
mjL* -1:?rt.y- t°u 'he. 'nUat10':
banks.
The commercial
the nation hold over $70 billion
in time and savings deposits ol
the
as
loans
However, this is not the whole
story.
may
bonds
new
more
•»
*
•
•
pol-" guards which were supposed to Monica Boulevard.«
i
.
> *
-
.
.
.
Volume 131
Number 5416
Continued
from
.
(1537)
Ltd.
15
page
The Commercial and Financial Chronicle
.
.
and
director
a
Hawaiian
'News About Banks and Bankers
Commercial
Co., etc. He is the
L.
Maude,
ac¬
cording to the Newark "Evening
of March 22, which also
of
sale
stock
new
$250,000
said
in
has
been
"Mr.
part:
with
1926,
has
years
in
the
since
bank
specialized
in recent
servicing op¬
Supervisor of
mortgage
erations, serving
as
Insurance since 1950. He will
tinue
with
the
con¬
servic¬
ing department in his new post."
mortgage
%
%
Chief
Executive
Officer
of
The
Pennsylvania Company^ for Bank¬
ing and Trusts, of Philadelphia,
Pau, effective
nounced
March
by
28
the
boardroLdirectors. Mr. Kurtz will
continued fr-Director of the companylapd will
of- the
a
Chairman
serve as
^Executive Committee; and
member of .the Trust Committee
the.^fio^rd. ' William
tif
'elected Chairman
was
-
L.
the
capital
having
a
amount
from
Oshkosh
Na¬
$300,000, the
been
enlarged
of
$200,000 following the
laration
of
dividend
stock
a
dec¬
of
$100,000.
$
of
*
;
:'f
Oklahoma
Oklahoma,
Jan.
of
as
amount
National
reported
19
having
Bank
capital
a
the
increased
stock dividend
$75,000.
*'
*
A
capital of $500,000 is re¬
ported by the Alabama National
Bank
of
creased
Montgomery,
Jan.
on
following
*
The
of
-
$100,000.
*
of
board
in¬
Ala.,
14 from $400*000
declaration of a
the
dividend
stock
of
close
of
The
"I
the
of
will
have
spent 47 years in
as
commercial
a
bank
looking forward
the active man¬
agement to my younger associ¬
ates, Mr. Day, who will take my
place
as
Chairman
and
Chief
Executive Officer, an<LMr. Kelly,
who will become President and
Mr. Day's next in -command."
Since
1938, when
Mr. Kurtz
officer.
I
turning
am
to
over
-
-The
of
President
elected
was
Pennsylvania Company, the bank's
deposits
have
increased
from
$743,475,000, total
capital funds from $25,564,000 to
$63,903,000, total resources from
$258,445,000 to $821,208,000, and
trust
and
custody
funds
from
$650,000,000 to over $1,600,000,000.
$232,068,000
to
Kurtz
Mr.
president
1930,
Com¬
Trust
of which he was President,
pany,
bank. In
1934, he was elected Executive
Vice-President,
and
four years
with
merged
was
he
later
He
Board
that
the
1950, and has continued in
post since his retirement as
joined the company in
and that
Mr. Dav
1949
Vice-President
as
same
year
He
board.
1952.
in
President
elected
was
named
was
Vice-President in
and
;
of
Chairman
Chief Executive Offi¬
and
in
cer
President.
named
was
elected
was
the
was
elected
Executive
February,
1950,
President
and
Officer
Administrative
Chief
the
to
in
Mr, Kelly started with the com¬
,
pany
nental
Conti¬
the
when
1931
in
Equitable Title
and
with which he was as¬
absorbed
by
the
He was elected Assistant
bank.
"he
was
in
and in
Vice-Presi¬
1939,
elected
the Time Sales
Division.
He was elected Senior
Vice-President in 1950, and Ex¬
dent in charge of
ecutive Vice-President
*
*
in
1952.
to
Va., from
amount
of
$1,353,000 to $1,488,300.
enlarged capital
fective March 3.
The
%
Victor
Van
*
Wert
became ef¬
*
National
in
stock
these
#
Winfrey
Assistant
California
2261. has
dividend, as noted
Dec.
2,
page
further enlarged its cap¬
ital, adding $50,000 thereto by the
has
been
Vice-President
Bank,
of
Los
Wells
Fargo
and
Bank
Union Trust Company, San Fran¬
cisco, having been associated with
since
bank
*
The
1935.
*
*
f
the
main
office,
in
the
district of the city
North
it
was
announced
by Anderson
Borthwick, President.
The new
office,
chartered
as
the
North
Drive-in
Park
the
three
Branch,
is one
structures
new
of
be
to
completed this year. A branch in
Chula Vista is expected to start
operations in a few months,, and
construction will begin on a new
building to house the Lemon Grove
branch in the near future., ,The
new office was built on the oppo¬
site
of
corner
the
block
same
as
the North Park branch for greater
service.
customer
in
is
branch
will
and
of
also
American
Francisco,
election
the
new
serve
as
Valley Bank of Greenville, Calif,
was
taken
over
and converted
into
office of the First Western
16. J. W. Reinhardt will
an
Mar.
on
"'the
10.
729,
the
In
Trust
der
Bank
name
United
Bank of San
Kirk
C.
as
of
10, page
merger
Trust
Salinas,
Trust
of the
of
&
Calif,
Co.
un¬
if
First
Trust
*
tion with the State
Superintendent
of Banks for permission to open a
banking office in Fresno,
Calif., T. P. Coats, Chairman of
new
First Western's
The
First
Trust
board, announced.
Western
Company
a
Bank
and
Mar. 9, broke
on
banking build¬
new
ing on a new site in
View,
Calif.
Robert
Mountain
Lewis
is
Manager of First Western's Moun¬
tain
*
n
g •
a
sj:
was
Bank
elected
of
.
Sound
.
is
the
the
and
saver
enterpriser
the fruits of their labor.
is
moral
quality in sound, hon¬
Sound money is
synonym
for justice and integ¬
Henry J. Court, Manager of the
Temple City office (Los Angeles
County)
of
the
First
Western
Bank and
those
.
.
.
Trust
Company, of San
Calif., has been pro¬
Francisco,
moted
to
named
Vice-President
senior
a
member
business
and
of
Executive
Court's
de¬
San Francisco. R. A.
Committee,
said
to
the
Mr.
head¬
quarters office would be effective
immediately. Mr.
Court formerly
President of the Temple City
was
National Bank before it
solidated
and
with
prior
was
First
the
Western,
Vice-
to
that
he- was
of
President
con¬
the
Republic
Na¬
tional Bank, Dallas, Texas. He has
in
been
the
-
*
The
of
Trust
Savings
and
Riverside,
Calif.,
now
under
construction, will be open
May 9, according to
W. E. Squires, Vice-President and
Manager of the
Perris Office.
Open
House will
be
held
on
for
business
if
*
Bank
and
Chicago,
Company,
Trust
111.,
was
Vice-President of Califor¬
elected
nia Bank, Los Angeles, Calif., at a
meeting of the Board of Directors
on March 14, Frank L. King, Pres¬
ident, announced.
Mr. Hannahs
will
be
in
charge of
the
Bank's
Out-of-Town Division.
Hannahs
sound
been
Bank
the
and
Company, New York, from
1938 to
1948, when he became
sociated
Illinois
with
the
National
*
as¬
Continental
Bank.
*
over
and
*
many
to
ance
Francisco,
These
principles of
"sound money," we have certain¬
ly been led astray by the great
monetary experts of the past; for
they are not the principles of
"sound
money"
enunciated
by
recognized monetary leaders of
the
past, such as Adam Smith,
Alexander Hamilton, and Daniel
Webster -t- to name just a few of
those leaders. I prefer to accept
views
the
Daniel
of
what
Webster
constitutes
as
"sound
proclaimed by him in
the U. S. Senate on Feb. 22, 1834.
as
Following,
conception
is
Daniel
of
Webster's
money":
"sound
"I
the
First
"sound
money" principles; for he
ascribes
to
Alexander Hamilton the'
thb&e
Burgess principles set forth ear¬
lier herein
ton
as
and
—
which Hamil¬
probably would not recognize
having originated with him.
Here
is
how
Mr.
Burgess
gives
Hamilton "credit" for the
modern*
New Deal type of
money: }
'
"Again let me
principles are not
that
say
these
They
new.
are
traditions established at the very
founding of the republic by Alex¬
ander
Hamilton
ward
by great
and
carried
forr
of all parties
men
history of the
coun¬
try."
It
be
must
Burgess
erly be
said
that
the;
principles
cannot
attributed
to
Hamilton; they
forward"
by
Alexander
not "carried
were
John
three
prop¬
Sherman,
of the founders of the
one
Republican
Party; and they were never "car¬
ried forward" by Grover Cleve¬
land, a great leader of the Demo^
crat Party. It would be
interesting
learn who those "great men of
Why,
it
Mr.
was
appeared
as
Burgess who
opponent
an
gold-standard bill, at
March 29, 1954; but
of
one
the
for the
best
Gold
On
seen.
a
of
hearing
who
a
on
voiced
recommendations
Standard I have yet
occasion Mr. Buft-
that
said:
gess
"From
nation
tions
was
the
until
of
founding
1933,
with
serious
of
'our
interrup¬
the dollar
firmly attached to gold. The
gold
value
lished
Hamilton,
cept
of
war,
the
dollar, estab¬
Washington
>and
under
not
was
changed,'
fractionally,
know, indeed, that all paper
ought to circulate on a specie
years.
bank-notes, to be
safe, must be convertible into gold
for
ex¬
'140
over
instill in
basis;
that
all
er.
.
,
money
paper
is
It
of
not
a
in
like
not
paper
is
Such
.
currency
an
odious
is
not
sense.
Continental
the
Revolutionary times;
worthless bills
of
it
is
gold
like
the
which
have
suspended
the
representative of gold
silver, and convertible into
and
silver
on
answers
demand,
and
the purposes of
so
long as its
sustained, it
cheapest, the best, and the
most convenient
um.
of
I have
circulating medi¬
already endeavored to
The confidence in the value
the
dollar
which
this
helped
our people and the
peo¬
ple of other countries was one of
the
foundations
the
of
Natioti
s
spectacular success."
FREDERICK
Connecticut
it
dian
of
Burgess
thesd
to
the
are
President
In¬
Mr. *
of
unaware
three principles of "sound
money!'
as
enunciated by Mr. Burgess.
those
is the
new
Unfortunately,
seems
monetary stability."
credit is in this way
the
fully convertible gold basis." h*.
all parties" were, who are
alleged
to
have
"carried
forward"
the
ulatory authorities, and the bank
office
demon¬
years.
give sound guid¬
opened March 16
Valley
.
specie payments. On the contrary,
San
in
re¬
"Third, the management of the
public debt in
the interest of
therefore
Western.
as
.
.
monetary policies; and,
the regular directors meeting held
Mar. 8.
Mr. Mcintosh, is Vice-
Francisco
over
world's history
tem dedicated to
Trust
as
proved
principles are:
"First, a budget under control;
"Second, a central banking sys¬
and
Company,
achieving
not new. They
principles remain
strated
banks
Sale of the assets of the Indian
•.
currency to "a dollar dh
in the proud
and in many circum¬
stances of the
the
However,
of
are
tried
many years
Bur¬
say:
methods
money
have
than
Mr.
from
and silver at the will of the hold¬
with
was
National
to
goes on
"The
spoken
above.
quoted
as
If
Office of Citi¬
Perris
new
Bank
*
*
National
zens
business
banking
since 1918.
emanating
truer words
no
been
ever
gess,
the
development
transfer
Up to this point,
have
he
the
putting into effect great American
gold and silver; and
San
of
There
.
money.
a
Calif., has been approved by reg¬
and
.
.
rity."
Cali¬
of Alexander & Baldwin,
to avoid
necessary
fornia, N. A., of San Francisco1 at
manager
have
money is
a
notwithstanding
the Administration,
platform, promised to
our
may
inflation and deflation, which rob
a
if.
store
for keeping the
economic life on
an
keel without a mass of direct
It
that,
that
its 1952
essential
controls.
est
View office.
i'Act
country's
even
we went
1933; arid
still true today. And yet,
are
doing
Frederick G. Shull
rely, in which they
basic
true one-hun¬
were
paper*" which Webster •
regarded as "miserable, abomin¬
able, and fraudulent." And we\arfe
"Next to defense, our great ob¬
jective is sound, honest money on
which the people of the country
.
years ; ago.
deemable
remarks
confidence.
'120
continue to operate with- "irrei-
we
that occasion:
can
any
words of Daniel
later,-when
years
they
from Mr. Bur¬
Valley Bank of Greenville, Calif.,
to the First Western Bank
and
*
J. Gordon Mcintosh
The
i
of
off the Gold Standard in
intefest1
excerpts
and
formal applica¬
dred
are some
very;
on
Bank
Company of San Francisco
a
Here
gess'
,
Western
Mar. 8 filed
on
Trust
National
Diego. Calif, reported
on Jan. 24,
of
ap¬
Mar. 10 issue, page
our
Commercial
*
*
States
$85,000.
director
ref¬
office
1177.
Mr.
latter.
capital of $1,785,000
*
manager. A
Chico
money,"
the
the amount having been increased
from $1,700,000 by a stock divi¬
a
the
attempts; to
paper
true when they* Wete
were
spoken; they
March
issue, under
the
heading
"Opportunity
Unlimited."
to
of Feb.
American
the
*
a
to
the
are
Webster,, spoken
They
in
3
Illinois National
reported the
Monterey County
The
Assistant
any
,'|j}
Brooklyn-—as
your
which
to
one
Those
in
covered
Vice-President of the Continental
we
the
office,
located at 321-325' Main
Street. Fred C. Williams has been
-Industries"
Company, of
announces
issue
policy,
value
single moment longer
than such paper is redeemable on
demand in gold and silver."
Building
Lynn T. Hannahs, Jr., formerly
of the company as of Mar.
our
Chico
new
ijt
Executive Vice-President and Di¬
rector
in
President of
Harris
of
placed
was
operation when the former Indian
^
James K. Lochead,
San
office
compnmm
Saturday, May 7.
^
the
Marshall
F.
charge
Officer.
Escrow
ulent
Estate
California
tbe
Peterson, Chairman of the bank's
recently,
>
their own notes; against that
miserable abominable, and fraud¬
and
of
55th
and
partment in
its 13th branch, including
:
irre-r
for
Real
number
56
.
and
Savings Bank of San Diego, Cal.,
J
:
country
paper
of banks which do not
pay specie
Feb.
'and
offices .to
M'J
;
Trust
■
against
deemable paper; against the
ciation
bank's
National
First
opened
Park
Chronicle:
On
the
warn
.Western
An¬
Division, Frank L. King,
President,
announced.
He
was
formerly Assistant Vice-Prseident
the
and Financial
bank,
ground for
of-Town
Ohio,
columns
stock
a
geles, and is assigned to the Out-
Bank
which in¬
creased
its
capital
in
October
from $150,000
to $200,000 by a
Wert,
Van
$50,000
*
H.
elected
dend of
The
by
13, page 175.
*
Savings
*
the
$135,300 brought about an increase
in the caoital of the Peoples Na¬
tional
Bank
of
Charlottesville,
of
capital to the
$700,000,
columns Jan.
into
stock,
New
of
was
Vice-President
1945
25, the Idaho
of
Boise,
Bank
amount, as a re¬
sult of which the capital was en¬
larged from $3,500,000 to $4,200,000.
The
plans to increase the
capital were referred to in these
than
Editor, Commercial
Asso¬
The
dividend of that
Trust
Company
sociated
National
*
Idaho augmented its
of
8.
,
unaware
Banks
!?!
*
National
White
September, 1952.
of
First
Under date of Jan.
of
business April
Billings.
*
The
in
Company
Colonial
the
when
of
Director
Bank
the
Vice-
elected
was
and
Pennsylvania
in
extent
Shull, of Gold Standard League, says Mr. Burgess
of the
principles of sound money held by
Adam Smith, Alexander Hamilton and Daniel
Webster.
seems
give
which is
The
of
22, the bank changed
to
Officer.
banking business this June, 37
them
March
name
First
Frederick G.
"Savings
peared in
his retirement,
50
Chicp
its
upon
de¬
of
office brings the number of First
tive
said:
also
409
25, 1955. Mr. W. Ran¬
opened on Mar, 21, T. P. Coats, dolph Burgess, Under Secretary
Chairman of the bank's board of1 of the Treasury, addressed a confere,nee of
directors, announced. The
tive
Mr. Kurtz
Sccrefaiy Burgess
On Sound Money Principles
the First Western Bank and Trust
ment., -.William
Commenting
bank
No.
Chico, Calif., office of
new
erence
and Chief Administrative
Finds Fault with
The
ijt
manage
*
directors
National
Montana
Bank
of
share payable April 15,
1955 to shareholders of record at
named
F. Kelly, Execu¬
Vice-President, was elected
Mr. Day's successor as President
the
Dividend
Bill¬
-suc¬
his, retire¬
Mr.t Kurtz .upon
formerly
Board
bank's
$300*000,
been
*
EDITOR:
Sugar
of the late
was
cents per
the
THE
ties served by the bank to 41. The
of
from $225,000 by a
of
LETTER TO
Company of San Francisco, Calif.
Day
to
clared
ings, Mont, announced that effec¬
ceed
com¬
Bank of California. The Board of
Directors
*
Bank of Oshkosh, Wis., re¬
ported
Exec¬
and
of. the bank
utive* Head
tional
*
31
June 30, was an¬
on
s>p
Jan.
The
Board Chairman and
as
On
*
The. retirement of William Ful-
tori'itetz
*
who
Webber,
making it
Feb. 23.
of
as
News"
and
the
of
&
son
C. K. Mcintosh who
Chairman
William
that
'He is also Vice-President of
pany.
President
of
„
Gold
Chapel
New
Haven
League
Street
15,
12, 1955.
Joins
SHULL, ,?''
Chairman,
State
Standard
2009
March
G.
Conn.
.
t.,
Marache, Doffienijr^
(Special to The Financial Chronicle)
LOS
Black
is
Marache,
South
,
ANGELES, Calif.—John A.
now
connected
with
Dofflemyre & .Co., 634
Spring Street, members of
the Los
Angeles Stock Exchange-
0
46
The Commercial and Financial Chronicle
(1538)
Continued from page
than
last year in
trade
ings should approximate
Geographically, all of the increases in the week were concen¬
in the East North Central, West South Central and the
Pacific States. Mortality dipped or held steady in all of the six
other regions, including..the Middle Atlantic States.
Only the
105,600,000 net tons, the second highest
The record was 111,600,000 tons
in 1953. A 105,.
Pacific
quickened.
business
possible price increases inspired some
inventories, observes this trade journal.
The
are
Thursday, March 31, 1955
.
expected
reported
more
failures than
a
year
wholesale food
price index, compiled
by
Dun
&
Brad-
were
eight weeks. The index rose to $6.55 as of March
22, from the sixteen-month low of $6.53 recorded a week earlier.
Compared with $7.34 a year ago, the current level shows a drop
rebuilding of steel
and
in
there
was
mand
for
hold
decline
a
food.
goods,
level
of
a
"Steel" declares, seasonal lethargy
pronounced in mid-August, when ingot output will
be at the' year's low point of 75% of capacity, compared with an .
average of 63.1% for August, 1954. Buying may lag .behind con¬
sumption. This quarter's output should average around 77% of
capacity and yield 24,200,000 tons of steel for ingots and castings.
The production trend will be down in the first half of this quar¬
ter and up in the last half. Orders already are being booked for.
Setting forth its prediction,
was
as
some
prices at the wholesale level.
a
The dollar volume of wholesale
orders in the week
week
is to show the general trend of food
the
moderate decrease from last week.
preceding
The index represents the sum total of the price per pound of
foodstuffs and meats in general use and:its chief function
de¬
house-^.
above
the
raw
of
registered
ago,
from
31
the
in
though
Moving higher in price last week were coin, beef, bellies,
lard, sugar, coffee, rice, steers, hogs and lambs.
Lower were
wheat, rye, oats, cotton-seed oil, tea, cocoa, raisins, currants and
by late June.
i.
well,- but
Sales
year
rises
areas,
sold
apparel
unchanged
prunes.
The
price
some
of 10.8%.
rebuilding will con¬
tinue
since the quarter is
already booked heavily. The production rate will hover around
95% of capacity to make it the biggest quarter of the year. Out¬
put, it adds, should average 92% of capacity and yield 28,900,000
net tons of steel for ingots and castings. A seasonal decline should
1954.
slight
reported in
Spring
Inc., turned slightly higher the past week, marking the
street,
than
past week, trade in gasoline again
first advance in
steel consumption and inventory
through most of the second quarter,
will
States
Wholesale Food Price Index Ends Seven-Week Decline
High
set in
Mountain
considerable declines from 1954 prevailed in other regions.
ago;
Export demand has been good and strong
activity, lengthening delivery dates on steel
and
and
_
.
begin with consumers quit living off inventories and began buying
in
line with consumption.
Consumption increased as business
activity
lower
were
trated
600,000-ton output would be equal to 83.9% of the 1955 capacity
of 125,800,000 tons.
The upward thrust in the first quarter had several origins. To
domestic
Failures
lines except manufacturing. Both wholesale
notable ^declines from the 1954 level.
all
construction had
and
.
increased
The State of Tiade and
yearly out-turn.
in construction dipped to 21 from 25.
30 and
4
.
essentially
level
of
the
declines
in
lines offset rises in others.
As
during
since
the
of
much
first
of
the
time
January, most
wholesalers had larger sales than
in
the
conjparable period
year
a
earlier.
be most
the quarter, it reports.
The uptrend will continue in
Commodity Price Index Holding to a Narrow
Range Edged Slightly Higher the Past Week
,
,
,
commodity price level moved in a narrow range
edged- slightly upward during the past yeek.
The daily
wholesale commodity price index, compiled
by Dun & Bradstreet,
c
finished
week
the fourth quarter to a peak of
85% of capacity. The spark will be production of new model
autos.
Steel output will slow down for the year-end holidays.
Steel consumption and output will equal one another this quarter.
The quarter's production will average 80% of capacity and total
25,200,000 net tons of steel for ingots and castings, it further
275.88
at
March
on
previous and with 278.57
Grain
despite
markets
comparing
with
274.56'
a
the corresponding date last year.
irregular and finished mostly lower
latter part of the week. Following the
on
the troubled political
as
situation in China and
the Winter wheat
belt.
the
According to
week
For the like
a
port issued
at
of
Spring wheat
March,
for
this
month
If
placed at 1,648,000 tons or
weekend
year.
last
based
and
of Agriculture
intentions
on
to
re¬
plant
cash
needs.
Daily'average sales
with 179,044,000 bushels pro¬
independent firmness particularly
markets, reflecting inadequate marketings for trade
grain and soybean
of
futures
The operating rate is not
than capacity in 1955. The
based on annual capacity of 124,69.1%.
Hard wheat
bakery flours continued in'slow demand, reflect¬
lack of confidence in prices on the part of most bakers and
still held fairly good balances to draw upon. The
world sugar market continued active and strong under the
impetus
percentage figures for 1954 are
jobbers who
330,410 tons as of Jan. 1, 1954.
of
Electric Output Shows
of
amount
The
electric
Further Rise the Past Week
energy
distributed
by
the
heavy demand for Cuban
shown
terest
electric
Cocoa
ended Saturday, March 26,
estimated at 9,907,000,000 kwh., according to the Edison
week.
1955, was
in
Electric Institute.
This
output advanced 93,000,000
week's
the
kwh. above that of
moved
London
creased
previous week, when the actual output stood at 9,814,000,000
kwh., and increased 1,416,000,000 kwh., or 16.7% above the com¬
parable 1954 week and 1,832,000,000 kwh. over the
and
from
raws
Russia
Loadings Hit By Labor Strife Drop 1.6%
market
slow
and
further
a
ing week, according to the Association of American Railroads.
Loadings for the week ended March 19, 1955, totaled 656,117
increase of 46,158 cars, or 7.6% above the corresponding
decrease of 44,948 cars or 6.4% below the corre¬
an
1954 week, but a
sponding week in 1953.
Capacity Expected to Set
New All-Time
The past week's
trucks amounted to 204,692 units,
week.
production
an
of cars and
increase above the preced-'
assembled.
reduction
set
by United States-Canadian
and
eclipsed
car
in the latest week, the above agency
reports.
week, the agency reported there were 26,849 trucks made
in the United States. This compared with 25,309 in the previous
Last
22,151
In
the
placed at 10,310 cars and 1,775
plants built 9,872 cars
Dominion
1,401
trucks, and for the comparable
2,094 trucks.
and
1954 week 8,283
cars
industrial
failures
edged up to 232 in the
week ended March 24 from 226 in the preceding
week, states Dun
& Bradstreet, Inc.
In spite of this increase, casualties remained
below the 277
of
188.
occurring a year ago, although exceeding the 1953
Mortality continued 34% below the prewar level of
of the
week's upturn
occurred among failures involving
which rose to 200 from 190 last week.
liabilities of $5,000 or more,
The number of concerns failing with liabilities in excess of
$100,000 increased to 22 from 14 in the preceding week.
Failures among manufactureres rose to 60* from 49, among
retailers to 113 from 107 and among service businesses to 19 from
15. On the other hand, casualties in wholesaling fell to 19 from
British
Cocoa
were
an
up
sharply for the week.
light but prices firmed
at
up
the close
latter market
was
aided
by the smallest receipts since
Spot cotton prices closed higher after fluctuating over
Early
weeks
1954,
ended
recorded.
Jan.
1,
For
the
1955 to March
gain of 8%
past
cold
as
trade
in
week
and
a
a
registered above
was
1954.
of
Retail
the
period
19, 1955,
New
inclement
only
like
period
weather
sales
consequence
was
York
City
hampered
was
by
and
volume
about 3% ahead of the
year
a
ago
against
as
easinem-in
the
10% in the week preceding.
According
serve
market
was
the
19,
a
attributed
to
to
in
weekly
1955,
the
Re¬
department
New York City for
period
rose
10%
ended
above
March
that
preceding
an
recorded.
ing
week, March
increase
4%
12,
1955,
(revised)
was
For the four weeks end¬
March
5%
of
19,
1955,
occurred.
an
For
increase
the
period
Jan. 1, 1955 to March 19, 1955 the
2% from that of
1954.
uncertainty
Government surplus disposal program while strength in
late dealings reflected buying stimulated by expectations of an in¬
loan entries.
in
crease
of 36,645 bales. This was up slightly from the January
of 35,564 bales and compared with 34,852 in February last
year.
Reported sales of cotton in the fourteen markets declined
sharply last week to 70,100 bales, from 90,800 the week previous
and 151,800 two weeks ago.
Trade Volume
As
Rain,
pered
Registered Sharp Drop the Past Week
Floods Deterred Shoppers
Storms and
snow
and floods in various parts of the
shopping in the period ended
dollar
volume
of
retail
trade
on
was
country ham¬
Wednesday o"f last week.
considerably
level of the preceding week but well above that of
a
below
the
year ago.
Store-wide
promotions
boosted
consumer
buying in some
Eastern cities and those sections enjoying
Spring weather reported
heavy retail activity.
of
trade in
the week
was
Attention
buying
of
current
thirty
Some
and
close
to
on
automobiles
used
the
models.
last
week
Although
record-level
of
retail
a
with
in
were
hesitant
to
predict
a
total
year
ago, at the
would last only
In
dealers
heavy
dealers'
sales, stocks now on hand
addition, purchases "of automobiles are
higher in both April and May than in March.
days.
buying
of
focused
new
were
rate
about 25%
was
both
inventories
usually
traditional
pattern
coming
months, jM>weverr feeling that large sales
earlier in the year might
adversely affect the traditionally heavy
Spring selling season.
A
recent survey of consumer
buying intentions by the Fed¬
that^bout "the same number of per¬
automobiles in 1955 as did last year, when
eral Reserve Board indicated
sons
plan to buy
5,500,000
new
new
models
were
Your
RED
estimated
by Dun & Bradstreet, Inc., to be 3 to 7% above a year ago. Re¬
gional estimates varied from the corresponding 1954 levels
by the
following percentages: New England +1 to +5; South and Mid¬
west +2 to +6; East +3 to
+1; Southwest +4 to -f 8; Northwest
+ 5 to +9 and Pacific Coast -f 6 to -f 10.
solcL~Aiarger number-of -used
car
sales
of
the like period of last year. In the
index advanced
mod¬
Federal
index
Board's
the
over
of
a
March 19, 1955, an increase of 11%
of
upturn in hog values.
erate range.
350 in the similar week of 1939.
All
the
last October and improved demand for wholesale pork cuts.
Failures Rise Slightly in Latest Week
Commercial
toll
The
by
was
The total dollar volume
previous week
Business
Trading in lard
a year ago.
Canadian output last week was
trucks.
in
for
weakness
asking prices. Warehouse stocks of cocoa in¬
totaled 147,220 bags, up from 143,419 a week earlier
and
influenced
The
truck manufacturers two weeks ago were expected to be
week and
four
total
week's output of 3,189 units, states "Ward's." Last week's
output exceeded that of the previous week by 1,649 cars. In
corresponding week last year 117,058 cars and 22,151 trucks
peaks
the
average
according to "Ward's Automotive Reports" assembled an
177,843 cars, compared with 176,194 (revised) in the
all-time
for
average
Peak in Latest Week
estimated
New
1955,
registered from"
was
of cotton during the short February month,
according to the Census Bureau, totaled 720,815 bales, or a daily
a
The automobile industry for the latest week ended March 25,
and
11%
of
Consumption
U. S. Automotive
previous
lower
demand,
Board
Shipments of coffee from Brazil
\
decreased 10,431 cars, or 1.6% below the preced¬
Southern District,
slightly
manufacturer
a year ago.
Coffee displayed a firmer undertone aided
by improved^.roaster demand for spot supplies.
:
In Latest Week
in¬
120,-320
like week in
Loadings of revenue freight for the week ended Mar. 19, 1955,
which was affected by labor trouble on several railroads in the
and
rise
store sales
irregularly and closed
reflected
1953.
Car
increased
and
by other countries.
Easiness
Marketing
the
the
12,
March
a
light and power industry for the week
were
week
the
on
Chicago Board of Trade last week totaled 43;000,000 bushels,
against 55,200,000 the week before and 42,900,000 a year ago.
ing
car
In the pre¬
ceding
compare
Corn showed
year.
comparable because capacity was lower
ing
1955, advanced 14% from the
that
v
in¬
like period last year.
as
of 177,000,000 bushels is in prospect
crop
in the
the rate was 91.9% and pro¬
ago
a
the
States Department
realized, this would
duced
A year ago the actual weekly production
2,218,000 tons.
United
a
a
March
while
influences
reports of continued drought and high winds in some sections of
steel for castings as compared with
93.7% (revised) and 2,262,000 tons a week ago.
The industry's ingot production rate for the weeks in 1955 is
based on annual capacity of 125,828,310 tons as of Jan, 1, 1955.
duction
Board's
ended
that of the similar period of
tons of ingots and
2,258,000
week
upturn of last week, wheat turned downward in the face of such
operating' rate of steel companies having 96.1% oi the steelmaking
capacity of the entire industry will be at an average of 93.6% of
capacity for the week beginning March 28, 1955, equivalent to
1955,
19,
Reserve
the
were
rally in the
a
22,
for
was
Institute announced that
Steel
and
Iron
American
The
cars,
Federal
dex
on
taken from
as
bullish
reports.
was
the
The general
sales'
store
country wide Basis
and
Inc.,
'
„
Department
Wholesale
CROSS
—
„
must carry on I
-
Volume 181
Number
5416
.
The Commercial and Financial Chronicle
.
.
(1539)
The following statistical tabulations
Indications of Current
latest week
Business Activity
week
Latest
AMERICAN
IRON
Indicated
steel
AND
STEEL
operations
AMERICAN
Crude
42
INSTITUTE:
—Apr.
✓
3
month ended
Previous
Month
Week
Ago
on
Apr.
3
*93.7
91.9
and
condensate
output—dally
(bbls.
average
*2,262,000
2,218,000
1,648,000
New
6,858,400
Mar... 18
117,474,000
7,476,000
7,511,000
24,601,000
24,404,000
22,979,000
Mar. 18
2,801,000
2,579,000
2,543,000
2,250,000
Mar. 18
11,872,000
12,443,000
12,640,000
Mar. 18
Stocks at refineries, bulk terminals, in transit, In
pipe lines—
Finished and unfinished gasoline (bbls.) at
Mar. 18
Kerosene (bbls.) at
Mar. 18
Distillate fuel oil (bbls.) at
Mar. 18
8,538,000
8,532,000
8,925,000
8,399,000
183,953,000
183,424,000
176,877,<000
177,620,000
Residual
fuel
oil
ASSOCIATION OF
(bbls.)
—
.
.
at
AMERICAN
Mgr. 18
freight loaded
Revenue
6,845,300
6,767,300
6,461,150
U.
S.
Private
(number
of
CONSTRUCTION
of
19,053,000
18,427,000
20,170,000
71,019,000
62,612,000
45,113,000
46,710,000
44,507,000
r
656,117
666,548
655,035
648,838
632,567
ENGINEERING
—-
(U.
S.
lignite
DEPARTMENT STORE
output
.FAILURES
(tons)
Electrolytic
AND
INDUSTRIAL)
—
DUN
(E.
(New
&
PRICES:
(St.
Zinc
(East
59.363,000
26,103,000
8,050,000
*8,380,000
442,000
598,000
510,UUU
102
90
9,907,000
9,814,000
9,725,000
8,491,000
232
226
178
277
As
Feb.
of
.r.
—
...
,-r—1-
Crude
(tons
-
In
U.
Group
Industrials
S.
A.
Refined
pounds)
STORE
(average
32.700c
32.700c
32.700c
29.650c
-Mar. 23
39.000c
38.580C
36.250c
29.200c
91.500c
91.125c
91.250c
94.000c
J&ar. 23
Mar. 23
15.000c
15.000c
15.000c
13.000c
14.800c
14.800c
14.800c
12.800c
11.500c
11.500c
9.750c
97.55
96.38
99.99
»
seasonally
Employment
All
Payroll
29
109.42
109.24
109.42
110.88
112.75
112.56
116.02
All
110.70
110.70
Durable
110.34
Nondurable
_MSr. 29
107.62
107.62
107.62
109.60
110.15
109.97
109.97
110.70
110.34
112.50
110.52
110.52
2.73
2.68
2.76
2.50
3.20
3.21
3.20
3.12
3.01
3.02
3.03
2.85
3.13
3.13
3.12
3.00
3.19
3.19
3.18
3.15
3.49
3.48
3.48
3.30
3.30
3.30
3.19
3.16
3.17
3.17
3.13
3.14
3.14
3.15
3.03
404.0
399.8
397.3
436.1
^r- 29
29
INDEX
ASSOCIATION:
—99
(tons)—.
:
-
j
—-—fT11"* ,9
—iT1' 99
251,820
254,012
249,452
273,946 v
269,618
262,282
95
95
92
97
211,110
'
245,325
—1
of period
Mar. 19
478,707
504,708
419,484
375,158
107.23
107.33
107.18
108.03
PRICE INDEX—
1,564,520
1,493,102
1,644,715
905,313
$82,682,149
$7G,928,678
$84,358,655
_Mar. 12
-Mar-
1,701,240
6,804
4,690
9,051
7,792
1,694,436
1,334,115
1,479,124
970,131
Mai'< 12
$88,023,370
$63,267,057
$70,812,044
$41,514,314
™ai -92
574,580
J2
*
by dealers—
Number of shares—Total sales
1,338,805
1,488,175
331,290
376,080
5~74~580
331,290
397,150
513,700
552,910
Number of shares
MEMBERS
256,550
transactions for account
purchases
OF
—
U. S.
as
CAPITAL ISSUES
MIDLAND
*$2,261,000
$2,200,000
BANK
GREAT
*524,000
485,000
7,489,000
1,050,(^00
*$10,274,000
$3,735,000
£24,125,000
£4,813,000
£93,937,000
$2,653,351
$2,558,276
$1,687,885
BRITAIN-
LTD.—Month
firms
Total
carrying
customers'
extended
hand
on
net
to
of
Feb.—
in
and
of customers'
value
of
of
margin
debit
accounts—
balances
customers
banks
free
listed
284,120
253,690
396,330
215,930
Member
borrowings
borrowings
1,051,370
1,615,250
62,875
shares
34,976
308,951
1,069,011
768,233
171,154,679
124,905,523
105,476,316
107,646,029
124,835
120,844
1,824,797
balances
41,649
146,194
S.__,
356,480
104,517,827
credit
U.
350,770
1,062,885
175,587,870
in
1,779,286
1,086,328
*23,826,000
20,243,000
.
874,860
1
1,305,060
2,011,580
1,090,790
242,280
181,660
-388,250
373,000
PORTLAND
listed
CEMENT
of
bonds
on
U.
S.
on
other collateral
Govt,
(BUREAU
OF
isues.
MINES)—
December:
Production
(barrels;
20,300
12,700
46,900
22,500
Shipments
from
305,260
238,390
348,470
346,900
Stocks
end
22,290,000
Capacity used
325,560
251,090
395,370
369,400
532,426
461,253
619,250
457,126
70,990
52,110
139,395
41,000
-Mai—Mai-
841,252
664,625
748,525
377,675
912,242
716,735
887,920
418,675
2,371,016
1,955,593
2,917,280
1,905,986
318,500
582,625
279,430
2,712,245
1,599,435
(at
2,532,712
1,954,385
2,908,122
2,272,885
PROSPECTIVE
CROP
IN
mills
(barrels)
16,347,000
month—barrels;
...
*22,766,000
14,130,000
16,675,000
*10,732,000
19,231,000
89
of
3,294,870
1,878,865
DEPT. OF
PLANTING
REPORTING
THOUSANDS—As
Corn,
All
FOR
BOARD
of
1955
—
March
spring
110.0
110.3
110.8
foods
93.0
*92.3
93.7
99.6
102.3
101.8
103.2
104.8
82.3
80.5
85.4
92.0
Mar. 22
115.5
115.5
115.4
barrels of foreign crude runs.
§Based
on
new
114.4
1, 1954 basis of 124,330,410 tons.
reported since introduction of Monthly Investment Plan.
annual capacity of 125,828,310 tons
(,
(
t
_
as
U.
*98
84
S.
ACREAGES
1:
82,033
Other
81,893
13,960
wheat
Durum
15,887
1,112
spring
1,658
12,848
:
...
47,284
15,776
Barley
14,229
47,664
,
Oats
14,517
5,743
5,959
1,800
Sorghums
110.1
—
all
Flaxseed
Mar. 22
against Jan.
Dec.
STOCK EXCHANGE—As of Feb. 28
omitted >:
value
.Mar. 22
other than farm and
of
$4,088,000
IN
Member
1,670,320
.Mar. 22
$481,224,000
;
Market
Mar. 22
1955
$399,965,000
>11
INSTITUTE
478.000
for
all
Sweetpotatoes
19,882
1,434
Potatoes
2,462
21,322
purposes—
1,423
354
354
Tobacco
1,561
1,645
Beans, dry edible
Peas/ dry field
1,738
1,714
Peanuts
Hay
Sugar
beets
295
;___
_
287
19,981
18,753
1,914
1.932
74,360
Soybeans
1
128,668,000
49,345,000
1,154,000
Rice
products
foods
tNumber of orders not
60,354,000
Industrial
1,075,860
(
("Includes 778,000
—
INSURANCE— Month
1,909,780
—"Mar*
SERIES
100):
Meats
Jan
PURCHASES
1,312,680
Mar'•
Processed
of
64,579,000
—
1,596,310
Mar.
___
fie-ure
72,863,000
„
_
Market
of members—
Commodity Group—
All commodities
sRpvicivl
37,426,000
$525,998,000
:
omitted;:
Total
1,386,200
sales
^commodities
9,495,000
38,626,000
$2,456,000
LIFE
(000's
Cash
Short sales
Farm
8,943,000
40,551,000
71,445,000
-
Ordinary
10,537,590
375,410
NEW
$191,711,000
49,254,000
TO
LIFE
_____
17,188,000
Mar.
=
$169,921,000
142.372.00C
OF
.
—
(1947-49
$207,594,000
9,795,000
PAYMENTS
:
INSURANCE
12,644,620
-"Mar.
—
PRICES,
1.90
1.65
;
Total
15,886,370
Mar.
sales
—
1.96'
1.68
December:
dividends
Month
—-—-----—
sales
$1.80
54,241,000
of
payments
Mar.
sales
LABOR
38.8
$1.84
1.68
4_
endowments
Mar.
Total round-lot
Total
40.2
1.96
goods
benefits
Disability
Credit
—
purchases
WHOLESALE
Death
10,113,300
Mar.
;—-—-
sales
Other
goods
INSURANCE—BENEFIT
16,459,410
Short sales
Total
39.6
40.9
*39.3
$1.85
INSURANCE—Month
12,239,010
initiated on the floor—
purchases
Other
40.2
39.5
.„
POLICYHOLDERS —INSTITUTE
424,290
Mar.
Mar-
transactions Initiated off the floor
Total
LIFE
728,590
—'Har'
sales
Total sales
76.38
64.02
40.5
goods
Nondurable
(000's
—
Total sales
$71.28
41.2
—
goods
manufacturing
405,610
FOR
Short sales
Total
All
i
80.16
*66.02
Hourly Earnings—
496,210
~
—
$73.97
80.75
66.36
U
:
manufacturing
15.390,160
ACCOUNT OF MEM
BERS EXCEPT ODD-LOT DEALERS AND SPECIALISTS:
Transactions of specialists In stocks In which registeredTotal purchases
Mar.
Other
;
goods
Nondurable
War.
--j..'."
Short sales
$74.93
goods
Durable
Mar.
sales
Other
All
Member
TRANSACTIONS
Total
OF
Hours—
Mar.
Other transactions
DEPT.
NEW YORK
(SHARES):
Short sales
Other
S.
manufacturing
Nondurable
NEW
STOCK SALES ON THE N. Y. STOCK
ROUND-LOT STOCK TRANSACTIONS
Total sales
6,842,000
February:
332~440
Total Round-lot sales—
Other
U.
—
332,440
376~080
.Mar. 12
by dealers—
OF
of
Total
""Mar 12
Mai. 12
ACCOUNT
9,480,000
*6,799,000
HOURS—WEEKLY
Group
sales
AND
977,923
•
Short sales
EXCHANGE
All
Durable
LIFE
value
TOTAL ROUND-LOT
16,322,000
*9,166,j)00
$40,655;258
;;ar' ,2
sales
Round-lot sales
purchases
ESTIMATE
LABOR—Month
Policy
Mar. 12
other sales
Other
AVERAGE
AND
payments
Surrender values
-Mar. 12
•---
—
Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales
Round-lot
♦15,965,000
6,811,000
(customers' purchases) t—
Number of shares
short
140.5
16,082,000
:
goods
Annuity
ODD-LOT ACCOUNT OF ODD- "
LOT
DEALERS AND
SPECIALISTS ON N. T. STOCK W
EXCHANGE — SECURITIES EXCHANGE COMMISSION:^,
Customers'
104.3
*141.8
Average=100 )—
of
EARNINGS
Matured
STOCK TRANSACTIONS FOR
Customers'
*101,5
—
goods
Durable
Mar. 25
Odd-lot sales by dealers
FACTORY
7,520,000
5,386,000
144.8
Avge.=100l
*5,332,000
.-
AVERAGE =100
Dollar value
12,906,000
*7,221,000
Weekly Earnings—
wp
—29
OIL, PAINT AND DRUG REPORTER
*12,553,000
102.3
(1947-49
104.48
Group
at end
107
12,653,000
workers)
...
manufacturing
113.12
109.79
Group
(tons)
112
employees in manufac¬
industries—
turing
104.48
M*1'- 29
orders
104
7,314,000
(1947-49
number
110.88
m-- 29
(tons)
activity
100
9,271,000
Indexes
109.60
~^wr' 29
——-——-Mgr. 29
of
83
102
5,339,000
Indexes
104.31
3.48
Percentage
75
84
109
manufacturing
Estimated
112.93
—Mar. 29
Orders received
83
106
10G
!
(production
manufacturing
All
.
Group
Production
73
81
100
adjusted
____
109.60
A
PAPERBOARD
1947-1919
goods
Nondurable goods
JM*r.,29
Mfi'. 29
COMMODITY
FED¬
FEDERAL
—
adjusted
manufacturing
Durable
104.48
— -
.
.
NATIONAL
Y.
January:
All
*
-lv^r- 29
MOODY'S
N.
AND PAYROLLS—U. S. DEPT.
LABOR—REVISED SERIES—Month of
OF
YIELD DAILY AVERAGES:
Utilities
118,720
EMPLOYMENT
——
Aa
89,017
45,982
$24.17
Group
industrials
OF
$37.00
II
corporate——
113,949
44,579
of February:
monthly), unadjusted
daily), unadjusted
(average
Sales
29
—
108,503
-
DISTRICT,
BANK
$37.50
—
.i
*95,810
123,840
(tons
SALES—SECOND
RESERVE
RESERVE
$37.50
1
.
74,731
103,933
99,461
—
Stocks,
DAILY AVERAGES:
...
$701,000
123,162
stocks at end of period
copper
2,000
4.634c
—
i.-n
_l
pounds)....
$56.59
Aaa
Railroad
2,000
4.797c
M6r. 23
U. S. Government Bonds
Average
of
(tons
$56.59
Group
BOND
pounds).
$56.59
at
—;—
Utilities
2,000
4.797c
Baa
Railroad
of
of 2,000 pounds)
fabricators—
Mar. 22
M--r-
$713,000
YORK—
(tons
to
Sales
QUOTATIONS):
II"
II
$80,700
INSTITUTE—For month of
February:
Copper production in U. S. A.—
««
T
*$77,300
$703,000
NEW
omitted).
$56.59
at—1
II
(000's
28
——29
—
OF
Sales
*
„-II
11,800
22,500
Average—100—Month
'm
A|pr- 29
FOR
$46,400
11,500
*22,100
OUTSTANDING—FED¬
BANK
4.797c
corporate
Dollar
*$43,700
January
COPPER
DEPARTMENT
Average
1949
8,533
$77,400
PAPER
RESERVE
of
96.86
Unfilled
13,181
COM-
11,500
Mar. 22
at
of
(average daily), seasonally
Stocks, unadjusted
————
PRICES
OF
95
mar. 23
Louis)
BOND
6,908,000
108
23
St.
8,935,000
«
at—
Louis)
-DEPT.
SERIES- -Month
22,200
Deliveries
402,000
M&r- 29
Public
$154,281,000
.
Refined
U. S. Government Bonds
MOODY'S
$186,317,000
Total
21,261,000
11.500c
Public
$163,382,000
THE
BRADSTREET,
———-—-—-Mar. 22
J.
M.
IN
dollars):
-
Mar. 24
at—
York)
(New York)
Lead
26,571,000
St
copper—
tin
of
Wholesale
ERAL
lb.)___.
(per
refinery
NEW
(millions
99,031,000
igr. 19
Domestic refinery at
Export
78,232(000
RESERVE 35
100
Pig iron (per gross ton)
Scrap steel (per gross ton)
'
94,652,000
kwh.)
000
COMPOSITE
PRICES
107,524,000
INSTITUTE:
(in
steel
120.292,000
26
=
(NEW)
163,272,000
104,395,000
i^r. 19
INDEX—FEDERAL
AVERAGE
(COMMERCIAL
Finished
A
3,974
OF
Manufacturing
$283,564,000
207,823,000
154,015,000
M#r. 19
BRADSTREET, INC
IRON AGE
$312,218,000
220,816,000
134,095,000
7*
MINES):
(tons)
SALES
SYSTEM—1947-49
OF
$374,831,000
410,742,000
Mar. 24
BUREAU
$544,837,000
Mar. 24
and
ELECTRIC
INVENTORIES
COMMERCIAL
M&r. 24
municipal
coal
(in
INCORPORATION
MERCE
590,590
®
Mar. 24
—
Pennsylvania anthracite
«A&
2,008
11,369
GOVERNORS
609,959'
Mspr. 24
and
Bituminous
MOODY'S
Ago
2,422
SYSTEM—Month
thousands)
ERAL
construction
OUTPUT
Lead
Year
Month
$43,600
OF
STATES—DUN &
INC.—Month of February.
17,653,000
63,832,000
44,801,000
624,209
Federal
Straits
delivered—
cars
UNITED
10,607,000
63,735,000
Mar- 19
(no.
construction
State
January
BUSINESS
of cars)—Nrar. 19
cars)
construction
Public
METAL
freight
DEBITS—BOARD
BUSINESS
NEWS-RECORD:
X-
Previous
INSTITUTE-
Retail
freight received from connections
ENGINEERING
1
RAILROADS:
Revenue
Electric
CAR
February:
domestic
7,013,000
24,443,000
EDISON
of
THE FEDERAL RESERVE
Mar". 18
(bbls.)
Gasoline output (bbls.)
Kerosene output (bbjs.)_
Distillate fuel oil output (bbls.)
Residual fuel oil output (bbls.)_.
of that date:
Month
AMERICAN RAILWAY
BANK
of
.
Crude runs to stills—daily
average
COAL
are as
Latest
69.1
Mar.'18
Total
of quotations,
cases
either for the
are
PETROLEUM INSTITUTE:
oil
gallons each)
CIVIL
in
or,
Ago
§93.6
§2,258,000
Dates shown in first column
that date,
Month
(net tons)
production and other figures for the
cover
Year
Week
(percent of capacity)
Equivalent to—
Steel ingots and castings
or
month available.
or
47
72,770
833
963
-J
48
The Commercial and Financial Chronicle
(1540)
.
.
Thursday, March 31, 1955
.
■
•
.
V
it INDICATES
Securities
in
Now
Amcrete Corp.,
Dec.
6
Feb.
7,500 shares
of 6%
par¬
stock.
Price — At par ($10 per
ikare). Proceeds—For working capital. Business—Dis¬
tributor of prefabricated concrete wall panels and butresses made of steel reinforced dense concrete, etc.
Un¬
ticipating
preferred
March
Fuller &
American
Co., New York.
Asbestos
stock.
•
Co., Ltd.
Casualty
&
Inc.
Co.,
March 17 (letter of notification) 20,000
*
<&>ck
(par $5).
Price —$15
shares of
share.
per
Minerals
International
per
velopment
share.
preferred stock.
sinking fund debentures due
Ave., Grand
Reed
Y.
con¬
Price—At par
expansion in
construction
Price—$25.75
and
purchase of
share.
per
of
Mines
Ltd.
(Regulation "D") 1,500,000 shares of common
stock (no par value). Price—20 cents per share. Proceed*
f — For general corporate purposes.
Office — 411 Child*
Bldg., Winnipeg, Manitoba, Canada. Underwriter—De
®
Securities
2V2%
Arkansas-Missouri Power Co.
stock (par $5) be¬
common
record March
one
12%
shares
14 at
held
rights to expire
the
(with
on
rate
of
March
stockholders of
lative
oversubscription privilege);
April 4. Price—$20.25. Proceeds—
it Astron Corp., East Newark, N. J.
cents), of which 200,000 shares
count of the
company
are
to
stock
into
Un¬
be
sold
per
share.
cents).. Price—$3.75
city.
preference
shares
per
share.
These
stock.
corporate
Un¬
on
units
redemption
holders
—
(par $20).
—
To
retire
who
or
&
have
not
conversion
subscribe
$100
to
Price
—
—
repay
bank
C.
loan.
Office —221% West:
Underwriter—J. C. Wheat*
Corp. first mortgage bonds and $25,000,000 West¬
Lighting Co. general mortgage bonds. Under¬
24
be
Offering—Originally sefc
of market*
filed
204,586 shares of
common stock
(par $7),
subscription by common stockholder*
7, 1955 at the rate of one new share for
offered for
of record Feb.
each five shares held.
Price—$2.20 per share. Proceed*
stock, plus $440,000 to be availably
200,000 shares to Alator Corp. Ltd. and*
Yam Securities Ltd., and
$175,000 treasury funds, to bo¬
used to pay for geological
surveys and metallurgical re¬
search, for drilling expenses and other general
corporate?
from
(4/4-7)
cumulative convert¬
Price—To be supplied by
1 bank loans and for
First California Co.,
repay
sale of this
sale
of
purposes.
—
Office—Toronto, Canada. Underwriter—None.
Sudbury Basin Mines, Ltd.,
Consolidated
Toronto, Canada
Fleet, Inc.
$500,000 of 6% sinking fund
Jan. 31 filed 3,000,000 shares of common stock
Price—To be supplied by amendment.
(no par).
Proceeds—For
exploration and development of properties. Underwriter
—Stock
Securities Corp., Salt Lake
Power
Co.
be
sold
on
or
Toronto
selected
Stock
Exchange
dealers
in
or
United
Consumers Public Service
Co., Brookfield, Mo.
March 7 (letter of
notification) 1,200 shares of 6% cumu¬
lative prefererd stock.
Price—At
com¬
par
Proceeds
—
To repay bank
improvements.
Underwriter
loans and
—
($50
share).
per
for additions and:'
McDonald, Evans
& Co
„
Kansas City, Mo.
City, Utah.
Contact Uranium,
Mines, Inc., N. Y.
of notification) 500,000 shares of com¬
(par one cent). Price—10 cents per share.
Proceeds—For mining expenses. Office—100
West
Dec.
March 16 filed $12,000,000 of first and general
mortgage
bonds, series V, due 1985.
Proceeds—To repay bank loans
for construction program. U nderwriter—To be de¬
termined by competitive biddings Probable bidders: Hal-
Stuart & Co. Inc.; The First Boston Corp. and Coffin
Inc. (jointly); Harriman Ripley & Co; Inc.;
Blyth & Co., Inc., Kidder, Pea body & Co. and W. E.
Hutton & Co. (jointly); Salomon Bros. &
Hutzler; Kuhn,
Allyn
(letter
42nd
York.
k
■
Continental Electric Equipment Co.
(letter of notification) 8,645 shares of
stock (no par) to be offered for
Burr,
C.
stock
St., New York. Underwriter—Justin
Steppler, Inc., New
sey,
A.
7
mon
(4/12)
Corp. and
underwriters
States.
and
Securities
to
through
Price—At par (one cent per share). Proceed*
exploration and development expenses. Office—
317 Main St., Grand Junction, Colo. Underwriter—West¬
Co.; Union
95 cents) and 15,000*
(par one cent) to be offered in
preferred stock and one share of"
Co.; The First Boston Corp.
Jan.
stock.
&
of
Consolidated Fenimore Iron Mines Ltd.
for
stock for
—For
Loeb
stock.
150,000 shares of 7%
for May 11, but has been
postponed because
conditions.
No new date set.
Offering—May be effected in March.
Maine
Corp., Omaha, Neb
writer—To be determined by
competitive bidding. Prob¬
able bidders; Halsey, Stuart & Co.
Inc.; Morgan, Stanley
cumu¬
Development Corp.
Oct. 26 (letter of notification) 16,000,000 shares of
Central
to.
and!
25
Steam
Carnotite
-
dealers
Consol.
Co.,
ern
officers,
Edison Co. of New
York, Inc.
April 7, 1954, filed $50,000,000 first and refunding mort¬
gage bonds, series K, due May 1, 1984. Proceeds—To be
applied towards cost of redeeming $27,982,000 New York:
shares of stock. Price—Expected at $1,100 per unit.
Proceeds—For expansion and working capital. Office—
San Diego, Calif. Underwriter—Barrett Herrick &
mon
Ashby
stock
St., Charlotte, N.
& Co., Richmond, Va. •
100
•
Finance
shares
Proceeds —To
(amendment)
Inc., New York.
employees,
Trade
1967 and 50,000 shares of common stock
(par $1) to be offered in units of a $1,000 debenture and
same
West
a $1,000 note and one warrant.
Price—$1,00G'
unit (each warrant is exercisable at $10 per
share.)
per
debentures due
Office—Balti¬
Office—611
Underwriter—None, sales
in units of
Francisco, Calif.
California Tuna
thorugh
common
10
—From
Underwriter
surplus.
subordinate
Un¬
Proceeds
Feb. 15 filed
and
Antonio, Tex.
Corp., Charlotte, N. C.
(letter of notification) $100,000 of 20-year 6%
sinking fund notes and 100 ten-year war¬
rants to purchase 20 shares of common stock
to be sold;
Oct.
unit.
50,000 shares of 5%
Equitable Bldg.,
Donahue, 430 16th
$10 per unit. Proceeds
For
Underwriter—J. J. Riordan & Co., Inc.,.
42 Broadway, New York
City.
Price—
To
per
—
of
chester
common
Price
824
working capital.
due
may
—
11
common
May 15,
stock (par $1) to be
share of
Office
*
shares of
Underwriters—
stock
Co.
(letter of notification)
cumulative preferred stock
(par
the basis
redemption of $5 preference stock.
construction.
San
Underwriter—Mitchell Securities, Inc.,
14 filed
amendment.
stock (par 50
Proceeds—For manufac¬
purposes.
one
share held.
ible preferred stock
Sending and Receiving Units, working
general
for
California-Pacific Utilities Co.
March
Proceeds—For
activities.
capital
San
March
Weeks; and Stone &
common
Uranium
agents.
ac¬
Automatic Remote
Systems, Inc.
March 3 filed 540,000 shares of
common
more, Md.
first
their
Plateau
handled
be
derwriter—None.
and 50,000 shares for certain sell¬
Price—$4
increase
debentures,
Indianapolis plant)
Berlin, N. H.
$14,217,100 of debentures
convertible
Proceeds—For
for
15
subscription by holders of "called" $5
common
new
capital and
filed
each $5 preference
(par 10
expansion program, inventory and working capital.
derwriter—Van Alstyne, Noel &
Co., New York.
Teleac
Co.,
17
surrendered
(4/25-29)
common
011
city.
Corp.
(letter of notification) 300,000 shares of com¬
(par 10 cents). Price—$1 per share. Proceeds
stock
Place,
serial
purposes.
for improvements, etc.
Vegas, Nev. Underwriter
it Community Life Insurance Co., San Antonio, Tex.
notification) 23,500 shares of common
(no par). Price—$12.50 per share. Proceeds—To-
Corp.;-all of New York.
$100 of debentures and
March 25 filed 250,000 shares of
of
mortgage
corporate
Securities
offered for
an
To repay bank loans and for construction
program.
ture
general
1975, and 142,171 shares of
share for each
new
derwriter—None.
ing .stockholders.
for
Brown
common
4%
notes, and
and
Blyth & Co., Inc.; Hornblower &
one
Proceeds
Consolidated Credit
Proceeds
(3%%
debt
long-term
and
unit.
March 17 (letter of
Underwriter—None.
amendment.
by
same
per
stock
Corp.
record about April
preferred
St., Denver, Colo.
1,200,000 shares of com¬
share). Proceeds
preferred share for each six shares held.
Webster
ing offered for subscription by
Exploration
expenses.
supplied
18
of
Denver 2, Colo. Underwriter—John L.
Price—At par (25 cents per
outstanding
Corp., New York.
March 3 filed 36,868 shares of
be
To
28
Gaetano
one
Aircraft
—For mining
common
James E.
—
LaFortune,
Confidential
stockholders of
mon
Boston.
Uranium
Underwriter
(letter of notification)
mining
repayment of loans, and
Colorado
^Bridgeport Brass Co., Bridgeport, Conn. (4/18)
March 28 filed 202,547 shares of cumulative preferred
stock (par $50) to be offered for subscription by com¬
improvement of present plant. Underwriter—Paine,
Webber, Jackson & Curtis, Milwaukee, New York and
Arctic
15
stock.
—For
Proceeds—For
and
Oct.
Junction, Colo.
shares
Price—$14.50
Dec. 1 (letter of notification) 1,900,000 shares of common
stock (par one cent). Price—15 cents per share. Proceed*
Bldg., Salt Lake City, Utah, and 618 Rood
it Bozeman Uranium
mon
plant and equipment
new
Colo
Denver,
four
equipment and working capital. Business — Toproduce the "Skimmer Amphibian." Office—Deer Par^
L. I., N. Y.
Underwriter—None.
Co., Reno, Nev.
Feb.
Co., Marinette, Wis.
(4/1)
(letter of notification) 11,500 shares of common
(par $3).
Bldg.,
of
stock.
—For
Corp., Elko, Nev.
Oct. 15 (letter of notification) 1,000,000 shares of com¬
mon stock. Price—25 cents per share. Proceeds—For ex¬
ploration and development costs. Office—402 Henderson
Bank Bldg., Elko, Nev. Underwriter—Security Uranium
Service, Inc., Moab and Provo, Utah.
Chemical
March 17
mon
Blue Jay Uranium
($5 per share).
Mid-west, to fabricate ad¬
micro-zip machine and zipper manufacturing
equipment and for working capital.
Underwriter—D.
Gleich Co., New York.
stock
units
Colonial
Uranium,
Canyon
tinental Bank
ditional
it Ansul
common
Office—230 South Fifth St., Las
Inc.
Nov. 29 (letter of notification) 6,000,000 shares of com¬
mon stock
(par one cent). Price—Five cents per share
Proceeds—For mining activities.
Offices — 1003 Con¬
15, 1980. Price—To be supplied by amendment
Proceeds—Together with other funds, to redeem $18,700,000 of 7% cumulative preferred stock (par $100) at
$L15 per share and prepay $10,000,000 loan from Metro¬
politan Life Insurance Co. Underwriter—Smith, Barney
& Co., New York.
Offering—Temporally postponed.
Proceeds—For
in
share of
Price—At the market (estimated at $10
per share).
Proceeds—To selling stockholder.
Under¬
writer—Wm. J. Mericka & Co., Inc., Cleveland, Ohio.
March
vertible
offered
(par $1).
Blue
it Anchor Precision Corp., Westbury, L. I., N.
March 28 filed 118,000 shares of 5l/2% cumulative
Bank
Feb.
stock
American Locomotive Co.
filed $25,000,000
it Citizens Natural Gas Co., Inc.
15 (letter of notification) 80,000 shares of pre¬
stock and 20,000 shares of common stock to be
March
National
First
Co.;
Brothers; all of New York.
March
—Lester L.
705
Washington. D. C.
—
ferred
mining operations. Address—Box 77, Provo, Utah.
Investment Co., 242 N\ University
Bingham-Herbrand Corp., Fremont, Ohio
2 (letter of notification) 3,000 shares of
of
five weeks.
<#
commor
Price—At par
—
Office
Underwriters—S. D. Fuller & Co.; Peter Morgan &
and Vermilye
Underwriter—I. J. Schenin Co., New York.
(par 10£).
Proceeds—For exploration and de¬
(4/4-6)
1,000,000 shares of common stock (par five
Price—$1 per share.
Proceeds—For exploration
—For
fice
Corp.
Uranium Corp.
filed
7
and development program.
Corp., Denver, Colo.
Oct. 15 (letter of notification) 3,000,000 shares of com¬
mon
stock (par one cent).
Price—10 cents per share
Proceeds—For exploration and development costs.
Of¬
mining properties of subsidiary and for
working capital, etc. Office—Dover, Del. Underwriter—
Vickers Bros., New York. Offering—Expected in about
March 11
Chesapeake & Colorado
cents).
Mesa, Ariz., is President.
Bikini Uranium
Feb. 25 filed 460,000 shares of common stock
Price—$1
•
(par $1).
Dec.
Ave., Provo, Utah.
common
working capital and general corporate purposes. Office
—Orlando, Fla.—Underwriter—Goodbody & Co., Miami,
JFla., and New York, N. Y.
American
of common
Price—At market (estimated at about
$21 per share). Proceeds—To Francis G. Largent, Secre¬
tary of the company.
Underwriter—Francis I. duPont
& Co., Wichita, Kansas.
Underwriter—Weber
Proceeds —For
to 11 a.m.
up
it Cessna Aircraft Co., Wichita, Kansas
Feb. 15
(letter of notification) 500 shares
stock
—For
(4/1)
Bids—To be received
ISSUE
April 12 at the company's office, 443 Congress
on
Big Indian Uranium Corp., Provo, Utah
July 15 (letter of notification) 500,000 shares of common
stock (par 10 cents). Price—25 cents per share. Proceeds
"D") 600,000 shares of common stock
(par $1). Price — 50 cents per share. Proceeds—For
general corporate purposes. Underwriter—Maine Invest¬
ment Co., Ltd.
Fire
(jointly).
REVISED
St., Portland, Me.
(three cents per share). Proceed
—For mining expenses. Office—510 Newhouse Building.
Salt Lake City, Utah.
Underwriter — Call-Smoot Co.
Phillips Building, same city.
Feb. 17 (Regulation
A* American
(EST)
common
Aug. 6 (letter of notification) 7,000,000 shares of
15
D.
& Co. Inc.
Mesa, Ariz.
Insurance Co.,
shares of class A
800,000
Big Bend Uranium Co., Salt Lake City, Utah
(4/5)
(letter of notification) 149,500 shares of com¬
mon
stock
(par 25 cents).
Price—$2 per share.
Pro¬
ceeds—For expansion and working capital. Underwriter
—S.
filed
G. Johnson of
derwriter—None.
it American Alloys Corp., Kansas City, Mo.
11
PREVIOUS
ITEMS
•
stock
(par $1) to be offered to present and future holders of
its life insurance policies with stock purchase rights*
75,000 shares of class B common stock (par $1) to be
offered to present and future life insurance salesmen,
district managers and state managers; and 455,208 double
option coupons with and attached to policies of whole
life insurance, to be offered to the general public. Pro¬
ceeds—To build up capital and surplus of company to
permit to qualify as a full legal reserve company and
expand into other states. Underwriter—None. Richard
Briarcliff, N. Y.
notification)
(letter of
Registration
Best American Life
Wines, Inc. (4/18-22)
shares of common stock (par one
cent).
Price—$1 per share.
Proceeds—For exploration
of mining claims, and expenses incident thereto.
Office
—701 Newhouse Building, Salt Lake City, Utah. Under¬
writer—H. J. Cooney & Co., New York.
■
it Allied Uranium
March 25 filed 600,000
AD D ITION S
SINCE
;Jan. 28
/
common
subscription by stock¬
»
holders of record March 1. 1955 on the
basts of
share for each five shares
held; rights to
expite
one
on
new
AprU
Volume 181
15.
Price
Number
.
Office
1
—
The Commercial and Financial Chronicle
.
.
$18.75 per share.
—
capital.
5416
— For working
Place, Cincinnati, O
Proceeds
Hills
Green
shares of
share.
common
Proceeds—To
buy
Desert Queen
10
be offered
for
on
the basis of
as
subscription by
Oct.
(par $1)
the
122,716 shares to which it is entitled to subscribe.
Price—To be supplied by amendment. Proceeds—To be
•
For
Underwriters
Crestmont
Oil
Co.,
Los
Angeles,
Calif.
(4/13)
March 21 filed 125,000 shares of common stock
(par $1).
Price—To be supplied by amendment. Proceeds—To re¬
pay bank loan and to acquire additional not
fully de¬
veloped producing properties with good oil reserves.
Underwriter
—
Calif, and New
Shearson, Hammill & Co., Los Angeles,
York, N. Y.
drilling
704 Erie
principally for'financing the company's subsidiaries
—White, Weld & Co., The First Boston Corp. and W. C.
Pitfield & Co., Inc., all of New York.
Co., Salt Lake City, Utah
(letter of notification) 2,000,000 shares of
&
Co.,
;
operations
and
Ave., Renovo, Pa.
Diamond Uranium
Tex.
April 1
American
Fire
&
(Goodbody
Ansul
Chemical
(Paine,
Florida
(Friday)
Underwriter—D.
working capital.
Eastern
April 5
Underwriter—None.
Stainless
&
Co.)
,
.7.
the basis of
on
Webber,
Telephone
Jackson
&
Curtis)
April 4
—Colgate,
Peter
Co.)
$1,000,000
& Co.;
.
7
filed
of
three
Public
Franklin, Meyer & Barnett)
Securities
Ranger Lake Uranium
(James
Oil
&
Corp
Corp.)
Mines,
Oil
(Gordon
to
plant
&
Inc.)
Co.,
E.
Beers
April
American Alloys
IS.
5
Co.)
$300,000
(Bids
10:30
Chemical
(General
Sealed
Power
(A.
G.
CST)
a.m.
White
$5,000,000
Inc.)
EST)
noon
McManus
100,000
April 6
Eastern
Stainless
and
Peninsular
Storer
and
&
Co.
Corp.)
&
Co.
Webster
and
shares
it Elfun
March
$600,000
&
Co.,
Inc.)
Michigan.
Co..
&
Brown
April
Astron
Noel
Co.)
„
&
April
shares
Co.)
262.750
250,000
Securities
First
&
Gerber
Corp.;
Weld
&
'
.
Inc.)
243,060
Co.
Co.
and
by
W.
and
Carl
M.
White,
C.
Lindly
Inc.)
99,914
Co.,
(White,
2
it Fidelity
(Monday)
Lane,
May 10
Weld
&
by
Kuhn,
Co.)
Loeb
Space
&
&
Co.;
Corp.;
Ohio
Edison
$4,651,200...
Corp.)
Alabama
11
to
to
Power
a.m.
be
EST)
$12,000,000"
Invited)
;
,,,
$4,080,000
&
Flo-Mix
Feb.
Bonds
be
inyited)
14
cents).
$30,000,000
King,
&
Securities
287,000 shares
Co.;
Corp.)
The
Central
Central
Illinois
11
a.m.
par.
Proceeds
—
For
Underwriter—
EST)
Boston,
Mass.
stock.
Price—
Corp., New York
cumulative sink¬
For
Price—At par ($2 per share).
Underwriter — E. J.
working caiptal.
Co., Inc., New York.
EST)
$15,000,000
to
be
Gas
invited)
(Bids
to
be
invited)
/
Southern
Co._
.Bonds
working capital.
Underwriter
—
Tschirn
Co..
Insurance
Miami,
Fla.
(letter of notification) 3,000 shares of common
14
(par $10).
Price—$24 per share. Proceeds—To in¬
Office—7120 Biscayne Blvd.,
capital and sumlus.
Florida
$25,000,000
Underwriter—None.
Telephone
V/i*
(4/1)
Corp.
stock (par $10)
stockholders
April 1, 1955, and by certain officers and enV-
March 4 filed 77,350 shares of common
to
>
be
offered
of record
for -subscription
by
Common
.
500,000 6hares
Houma, La.
Home
Bonds
(Wednesday)
(Bids to be Invited)
for
Miami, Fla.
$4,000,000
Co.
/
and
March
crease
&
Corp.,
585,000 shares of common stock (par 10
Price—$5 per share. Proceeds—To buy equip-
Co., Delta Bldg., New Orleans, La.
stock
(Tuesday)
November s
Bonds
$12,000,000
7
Electric
Fertilizers
filed
it Florida
Bonds
a.m.
Virginia Electric & Power Co..
(Tuesday)
Maine Power Co
(Bids
11
June
Dominion
$17,220,000
of stock
Libaire, Stout & Co.) $700,000
April 12
At
—
Investment
(Tuesday)
Notes & Com.
(Bids
&
Inc.,
Credit
—
(Tuesday)
Co
(Bids
White River Propane Gas Co., Inc._Debens. & Com.
(Eisele
stock
i? First Investors Corp., New York
March 24 filed (by amendment) an additional $13,000.000 of periodic payment plans
(DW and DWN) and
single payment plans (DWP). Proceeds—For investment.
Bonds
May 24
$300,000
Corp
Peabody
Union
and
Fund,
Preceeds
Co.__
(Bids
Common
Kidder,
and
Price
Office—Phoenix, Ariz.
ing fund preferred stock.
Co.)
(Tuesday)-
May 17
Y/
&
(Monday)
Securities
debentures
A common
Jan. 29, 1954 filed 250,000 shares of 7%
New York, Chicago & St. Louis RR.__Eq. Tr. Ctfs.
(Bids
Debentures
Northwest Pipeline
Securities
& Discount Co.
shares of class
$15,000,000
Georgia Power Co
(Bids
Inc
(Aetna
Price—
shares
Rhoades
April 11
&
Loan
320,000
(par 50 cents).
<ment
Pacific
Seattle, Wash.
Inc.,
March 24 filed 3,000,000 shares of capital
At market. Proceeds—For investment.
Weld
Pitfield
Common Is.
Loeb,
com¬
share. Proceeds
and working capital.
Home
filed
Fountain
shares
stockholders—underwritten
-
per
Proceeds—For investment.
Financial
Common
Corp.;
Co
Sz
140,000 shares of
Price—$2
,
(Johnson,
Pan American Sulphur Co
to
cent).
None.
27
May
Co.;
$25,000,000
(Offering to stockholders—underwritten by A. G. Becker
(Offering
one
working capital.
Debentures
White,
(Thursday)
Eoston
Co.,
Products
29
stock
shares.
(White, Weld & Co. and Stone Az Webster
shares
stockholders—underwritten
The
Price—At
(par 25 cents), 214,285 shares of class B common stock
(par 35 cents) and 300,000 shares of class C common
(Wednesday)
Transcontinental Gas Pipe Line Corp.__Preferred
....Common
Halsey, Stuart & Co. Inc.)
to
Co.;
(par
Farm &
(Monday)
&
stock
Nov.
Common
Common
Alstyne,
Trusts.
Corp.
(letter of notification)
At market.
Common
Corp.
(Van
Electronics
16
it Equity Fund,
Inc.
25
the
March 28 filed 500,000 shares of common stock.
3
30,000
in
April.
$50,000,000
Sons)
units
Business — Re¬
electronic and other fields. Office
—617-33 Brooklyn Ave., Brooklyn 3, N. Y. Underwriters
—Standard Investing Corp. and Baruch Brothers & Co.,
Inc., both of New York. Offering—Expected early in
(Tuesday)
&
York
search engineering in
Bonds
Lothrop,
125.000
—For equipment
&
...Common
Inc
filed
*
New
Proceeds—For investment.
Elsin
Preferred
Co
Plastics,
Woodward
$40,000,000
Continental Telephone Co
(Offering
from
per
shares.
28
March
Corp).—$5,000,000
EST)
share
held; rights to expire on
share. Proceeds—Together
mortgage loan of $350,000 to redeem
Trusts,
market.
Augusta Newspapers, Inc.___Preferred & Common
.
funds
each
Price—$6
Office—141 Broadway, New York 6, N. Y. Underwriter
—--None, but Breswick & Co., New York, will buy un¬
Common
384,861
Jackson & Curtis and Stone
noon
for
Debentures
Blyth
April 7
Ireland
$581,700 outstanding income mortgage loan certificates.
$10,127,350
of
Securities
Electric
Common
Tennessee Gas Transmission Co
&
Co. of
Investment Corp. (4/12-13)
2,000,000 shares of capital stock (par $3).
April 8, 1955.
..Common
Co.)
Corp.)
Webber,
(Alex.
&
,
shares
new
Securities
(Monday)
Securities Corp.)
(Stone
Common
Webster
&
shares
(Irving J. Rice>& Co. and M. H. Bishop & Co.) $300,000
$3,000,000
Corp..
San
today
holders
Preferred
April 19
Common
Kibbe
Broadcasting Co
(Reynolds
18
(Wednesday)
Steel
Brothers
Stone
165.000
Cooney
(Bids
Northwest
Dynamics Corp
(Lehman
and
Telephone
Philadelphia
(Offering to stockholders, 96,755 shares; and to public,
30,000 shares—underwritten by Hornblower & Weeks)
General
$20,243,100
(Offering to stockholders—underwritten by Morgan
Stanley Ac Co. and Coggeshail Az Hicks) 158,203 shares
shares
$7,500,000
P.
A.
Expected
(letter of notification) 28,143 shares of capital
(par $1) being offered for subscription by stock¬
of* record March 18, 1955 on the basis of three
stock
Preferred
underwriting)
Securities
$1,530,000
CST)
& Co., Inc.,
—
March 3
Brass "Co
Bonds
a.m.
Co.
&
J.
Webster
$300,000
Canyon Mining Co
(Joseph
Union
(Paine,
Co
10:30
Corp.
Telephone
Common
Co.
&
Offering
,
mon
General
...Equip. Trust Ctfs.
(Bids
of
Securities
Common
Utilities
(Thursday)
Indiana, Inc
(Offering to stockholders—underwritten by Blyth & Co.,
Inc.; Hornblower & Weeks; and Stone & Webster
Bonds
Wabash RR.
West Texas
be
$299,000
Investing Corp.)
(Bids
Boston
Bridgeport
Corp
Becker
Co.
<H.
Co
Underwriter—Blyth
New York.
per share. Proceeds—For investment.
Office
Diego, Calif. Underwriter—William R. Staats &
Co., Los Angeles, Calif.
subscribed
Kentucky Utilities Co
Marlowe
14
April
$300,000
Co.)
office
—San
.Common
Allied Uranium Mines, Inc
Common
&
First
(May
(Tuesday)
Fuller
March
oh
Price—$5
$15,000,000
$500,000
Corp
D.
shares held
Price
Proceeds—For construction of-.£b*r»
building, new equipment and
$10.
be
and
filed
14
with
.Class A Common
(Allen
10
Electronics
Dec.
Debentures
Brothers)
"April 15 (Friday)
Westpan Hydrocarbon Co
Common
U. S. Igniter Corp
•
shares
Inc
Corp.)
Common
Co
Graves
125,000
$293,750
Anthony Securities Corp.)
Southern States
each
6 filed 300,000 shares of capital stock.
Price—At
($1 per share). Proceeds—For machinery and build¬
ing and working capital. Office — 407 Liberty Trust
Bldg., Philadelphia, Pa. Underwriter—None.
Common
stockholders—no
to
Common
Ltd
Calif.
par
$298,740
Savannah Electric & Power Co
(The
Uranium
(Chippewa
Service
iOffering
$3,150,000
Nevada-Utah
shares for
new
Electronics
(Wednesday)
Co.___
April
$1,000,000
and
Pasadena,
Corp.,
210,000 shares of capital stock (par $1)
subscription by stockholders at the rate
Eleven Moore Street Corp.
Vermilye
Common
Inc.
Brothers)
(Paine, Webber, Jackson & Curtis) 193,000 shares
Common
.
and
Holly Uranium Corp
Co..
Vermilye
13
Telecasting,
Hornblower & Weeks,
29; with subscription rights to expire on April 18.
Common
Hammill & Co.)
(Lehman
Gross
—
to be offered for
$10,000,000
Co
Trailer
>.
Jan.
and
..Preferred
Morgan
Brothers)
Oil
Underwriter
Md.
EiectroData
March
Common
Co.
(Shearson,
Freuhauf
Chesapeake & Colorado Uranium Corp
(Barrett Herrick &
Crestmont
shares
(Monday)
California
D. Fuller & Co.;
&
share for each five shares
New York.
(March 31).
Corp
Co., Inc
Fuller
April
Common
77,350
California-Pacific Utilities Co
(S.
D.
one new
plied by amendment. Proceeds—For retirement of bank1
loans, capital expenditures and working capital. Office
$296,125
Corp
(Ottering to stockholders—no underwriting)
(First
(S.
Common
(4/6)
2-week standby); and 30,000 shares of com¬
Curley,
a
Francisco and
Co.)
Corp.
Chairman of the Board and President. Price—To be sup-
CALENDAR
Lee Spring
$300,000
Co
Steel
(with
working capital
&
same
stock to be offered for account of John M.
•
Staats
Co.,
mon
it Dixie Fire & Casualty Co., Greer, S. C.
11 (letter of
notification) 5,000 shares of common
stock (par $10). Price—$25
per share. Proceeds—To in¬
crease capital and surplus.
Underwriter—None.
Investment
Investment
held
Corp., Moab,Utah
R.
Carter
126,755 shares of common stock (par $5),
96,755 shares are to be offered by the company
subscription by common stockholders of record
for
Office—
March
(William
G.
March 16 filed
Proceeds—For mining expenses.
Office—M. I. C. Bldg.,
Moab, Utah. Underwriter—Security Uranium Service,
Inc., K. O. V. O. Bldg., P. O. Box 77, Provo, Utah.
Common
Investment Co.
of which
(letter of notification) 3,500,000 shares of cofnstock (par one cent). Price—Five cents
per share.
Electronics
Casualty Co
"best-efforts
address.
new
ISSUE
on
(letter of notification) 25,000 shares of common
stock (no par). Price — $10 per share.
Proceeds—Fcr
working capital. Office—203 East Cotton St., Longview,
—Expected
NEW
Ltd., Toronto, Canada,
East Texas Loan &
Jan. 20
mon
Brown
Jan. 20
com¬
city.
same
W.
basis.''
★ Devonian Gas & Oil Co., Renovo, Pa.
March 1 (letter of notification)
500,000 shares of com¬
mon stock
(par 10 cents) to be offered for subscription
by stockholders. Price—25 cents per share. Proceeds—
April 7; rights to expire on April 20.
Theodore
& Co., which owns 50.49% of the outstanding
shares of Continental common
stock, intends to purchase
used
18
Van Blerkom
Gary
and for other general corporate
purposes.
a
~
Underwriter—
R.
stock Price—At par (15 cents per
share). Proceeds
—For exploration and
development expenses. Office—
524 Atlas Bldg., Salt Lake
City, Utah. Underwriter—
stockholders
common
Trading Co. Ltd., the selling stockholder.
Securities
mon
share for each four shares held
new
filed 1,100,000 shares of common stock (par,
$1)7 Price—To be related to the current market price
011 the Toronto Stock Exchange.
Proceeds—To American
Desert Uranium
of
one
it Dyno Mines, Ltd., Toronto, Canada.
Selected
—
mar¬
March-25
Building, Salt
Budget and Mutual and for working capital. Office—
815 Fidelity Union Life
Bldg., Dallas, Tex. Underwrite*
•—Securities Management Corp., same address.
to
•
City, Utah.
Underwriter
Ltd., Los Vegas, Nev.
stock
common
Proceeds—
Uranium Co., Salt Lake City, Utah
Lake
i r»
it Dodge & Cox Fund, San Francisco, Calif.
shares. Price—At
March 25 filed 25,000 beneficial
ket. Proceeds—For investment.
Jan. 26 (letter of notification) 259,500 shares of common
stock (par two cents). Price—$1 per share.
Proceeds—
for mining operations. Office—506
Judge
of
Continental Telephone Co. (4/7)
March 18 filed 243,060 shares of common stock
Price—At market.
y.
10-year
(par
cents) to be offered in units of $1,000 of debentures and
200 shares of stock;
remaining 12,000 shares to he pur¬
chased by underwriter. Price—$1,400 per unit; and
$2
per
stock.
common
For investment.
49
1
L
it Delaware Fund, Inc., Camden, N. 1.
25 filed
(by amendment) an additional 596,857
March
Underwriter—None.
Continental Loan Co., Dallas, Tex.
Dec. 22 (letter of notification) $150,000 of 4%
debentures and 42,000 shares of common stock
(1541)
; a
i
+
,
common
Continued
on
vacie
50
50
Continued
from
page
49
'
f
Price—$13 per share. Proceeds—For construc¬
Office—Ocala, Fla. Underwriter—None.
ployees.
it to expand its business, particu¬
larly in the writing of casualty and multiple-line poli¬
cies.
Underwriters—The First Boston Corp. and R. W.
Pressprich & Co., both of New York.
Plywood Co., Vancouver, Wash.
Feb. 21 filed 397 shares of common stock. Price—At par
Heliogen Products, Inc.
March 7 (letter of notification) 22,670 shares of common
stock (par $1), of which 12,670 shares are being offered
for subscription by stockholders up to and including
Fort Vancouver
($4,500 per share). Proceeds — For down payment on
purchase price of mill facilities and for other expenses.
Underwriter—John C. O'Brien, one of the promoters.
/
15, 1955, and 10,000 shares are to be offered
Price—$5 per share. Proceeds—For working
June
licly.
Grand Junction, Cola.
Aug. 1C (letter of notification) 300,000 shares of com¬
mon stock.
Price—At par ($1 per share). Proceeds—For
exploratory and development expenses.
Office — 018
Rood Avenue, Grand Junction, Colo.
Underwriter —
Joe Rosenthal, 1669 Broadway, Denver, Colo.
Four States Uranium Corp.,
pub¬
capi¬
Office—35-10 Astoria Blvd., Long Island City,
tal, etc.
Underwriter—Smith & Co., Waterville,
N. Y.
if Hi-Boy Uranium Exploration Corp.
1 (letter of notification) 55,474 shares of common
(par $1) and 5,000 shares of preferred stock (par
$1). Price—At par. Proceeds — For mining expenses.
Office—908 American Bldg., Seattle 4, Wash.
Under¬
stock
.
Hobby & Brown Electronic Corp.
(letter of notification) 100,000 shares of common
(par 10 cents). Price—$1.25 per share.- Proceeds
if Frontier Contractors Equipment Co., Inc.
—To increase inventory and for working capital. Office
March 24 (letter of notification) 5,200 shares of com-;/
—55 Front St., Rockville Centre, L. L, N. Y. Underwriter
mon stock
(par $1) to he offered first to stockholders.^
—W. Harry Young Co., Garden City, L. I., N. Y.
Price—$9.5C per share. Proceeds—To increase invest¬
in
Feb. 24
•
Holly Uranium Corp., New York (4/4-7)
10 filed 900,000 shares of common stock (par $1).
Price—$3.50, per share. Proceeds—To exercise certain
options on properties in Utah and New Mexico. Under¬
writer—Barrett Herrick & Co., Inc. and Franklin, Meyer
Co., Inc. Office—6 No.
Underwriter—None,
*
Siegfried Construction
Buffalo, N. Y.
Feb.
if Fruehauf Trailer Co., Detroit, Mich. (4/13)
March 24 filed $15,000,000 of convertible subordinated
debentures due April 1, 1975. Price—To be supplied by
am§hdment.
Proceeds—To repay bank loans and for
'
March
,
Co., Inc.
March 28 (letter of notification) 2,306 shares of pre¬
ferred stock (par $100) to be offered in exchange for
1,237 shares of first preferred stock (par $100) and 1,069
shares of second preferred stock (par $100) of Great
Southern Box Co., Inc. on a share-for-share basis. Un(Robert)
,
General
Dynamics Corp. (4/6)
convertible debentures, due
April 1, 1975. Price — To be supplied by amendment.
Proceeds—For expansion and improvement of facilities
and for working capital.
Underwriters—Lehman Bros,
and Blyth & Co., Inc., both of New York.
Dec.
15
Homes,
filed
offered first to
300,000 shares of common stock
'*
Co., New York.
'
i
Proceeds—To
stock
common
loans
and
of Eby company
notes
Blauner
&
Co.,
NewYork;
Inc.,
Proceeds—To
amendment.
—
To
supplied
be
by
bank loans and for
redemption of the outstanding $2.75 cumulative pre¬
ferred stock.
Underwriter—Paine, Webber, Jackson &
Curtis
and
Stone
repay
Webster
&
Securities
Corp., both of
New York.
Inland
Western
Loan
(4/7)
of record
about
April 7 at the rate of one new share for
(for a 14-day standby). Price—To
be supplied by amendment. Proceeds—For general cor¬
porate purposes. Underwriter—A. G. Becker & Co. Inc.,
shares
held
Chicago, 111.
^ Grammes
Feb.
28
(L. F.)
holders.
Price—$22 per share.
—Jordan and Union
Sts., Allentown, Pa.
Office
Underwriter—
None.
•
used
Telecasting, Inc.
Price—$5
Office—Lansing, Mich.
per
development
if Investors
Under¬
share.
Proceeds—For exploration
Underwriter—Baruch
expenses.
Bro¬
•
Lee
Paine, Webber, Jackson & Curtis, Boston and New York.
of
notificationr74,685 shares o^common stock (par 50 cents).
Price—$4 per share. Proceeds *
—Sir machinery, equipment and working capital. "Bps*-s
(letter of
18
ness—Manufactures mechanical
America,
&
Russell Originals, Inc., Wilmington, Del.
of notification) 12,300 shares of $10 per
class C (voting) common stock and 8,000 shares of $10
par class C- (non-voting) common stock to be offered
if Lillian
March 13 (letter
Office—Minneapolis, Minn.
Ltd.
filed
24,900 shares of ordinary common stock
Israeli pound). Price—$10 per share. Proceeds
(par one
—For capital expenditures.
Underwriter—None.
Gulf Cities Gas
15
stock
(par $1).
notes
repay
Corp., St. Petersburg, Fla.
31,500 shares of class A
(letter of notification)
capital.
Price—$7.75
other
and
share.
per
obligations
Underwriter—Eisele
Proceeds
and
for
—
&
King, Libaire, Stout &
Co., New York. Letter to be withdrawn; full registration
of about 50.000 shares expected. Offering- —
Expected
about May 2.
•
Gulf
States
Utilities
Co.
May 14, 1954 filed 160,800 shares of preferred stock (par
Proceds—To redeem 50,000 shares of $4.50 divi¬
dend preferred stock, 60,000 shares of $4.40 dividend
$100).
preferred stock, 1949 series, and 50,000 shares of $4.44
dividend preferred stock at the
prevailing redemption
prices of $105, $105, and $105.75, respectively. Under¬
writer
—
To
be
determined
Statement withdrawn Feb.
•
Gulf
States
May 14,
Utilities
by competitive
11, 1955.
bidding.
Co.
1954 filed $24,000,00 first mortgage bonds due
Mutual
City, Utah.
same
city.
Strike Uranium Corp.
Lucky
notification) 4,300,000 shares of common
cent)./ Price—Five cents per share. Pro¬
ceeds—For mining operations.
Office—38 South Main
St., Salt Lake City, Utah. Underwriter—Seaboard Se¬
Jan. 4 (letter of
stock (par one
curities Corp, Washington.
Justheim
Dec.
Petroleum
Co.
9
mon
stock
(letter of notification) 2,650,000 shares of com¬
(par five cents). Price—10 cents per share.
Proceeds
For oil and mining expenses.
Office—318
Phillips Petroleum Bldg., Salt Lake City, Utah.
writer—Hunter Securities Corp., New York.
Kentucky Utilities Co., Lexington,
March 7 filed
due April
Under¬
(4/5)
Ky.
$5,000,000 first mortgage bonds, series F,
Proceeds—For construction program.
Underwriter—To be determined by competitive bidding.
Probable
1, 1985.
series
stock,
Halsey, Stuart & Co. Inc.; Harriman
Ripley & Co. Inc.; The First Boston Corp. and Lehman
Brothers (jointly); Union Securities Corp. and Merrill
Lynch, Pierce, Fenner & Beane (jointly); Blyth & Co.,
Inc.; Kidder, Peabody & Co. and White, Weld & Co.
(jointly); Equitable Securities Corp.; Baxter, Williams
& Co. Bids—To be received up to 10:30 a.m. (CST) on
April 5 at 20 No. Wacker Drive, Chicago 6, 111.
•
Lexington, Ky.
common stock (par $10)
being offered for subscription by common stockholders
Kentucky
March 7 filed
each
12
Utilities
Co.,
190,566 shares of
March 21
on
the basis of
one
new
shares held; rights expire on April
share for
11.
Price—
Co., El Dorado, Ark.
Feb. 24 filed 500,000 shares of common stock (par 10
cents).
Price — $2.75 per share.
Proceeds — To repay
Hanover
24
Fire
filed
Insurance
Co.
100,000 shares of capital stock
(par $10)
being offered for subscrintion by stockholders of record
March
16
at
the
rate
of
one
shares
held; rights to expire
share.
Proceeds—To
be
new
pn
added
share
for
each
four
April 4. Price—$42
to
the
general funds
per
of
par-convertible). Price—To be
Proceeds—For const uction of
capital.
Underwriter — Newhard,
($50
C
and working
Co., St. Louis, Mo.
&
Marble Canyon
Feb. 4
Uranium, Inc.
(letter of notification) 20,900,000 shares of com¬
Price—At par (one cent per share). Pro¬
stock.
mon
ceeds—For mining operations. Office—587 — 11th Ave.,
Salt Lake City, Utah.
Underwriter—Potter Investment
Co.,
city.
same
Midland
Marine
to
in
offered
be
Corp.
filed 70,000
21
shares of common stock (par $5)
all the issued and out¬
exchange for
standing capital stock of The Farmers National Bank &
subject to acceptance deposit of not less than 80% (11,200
shares) of Farmers National. Underwriter—None.
Hilliard & Son,
•
•
Louisville, Ky.
Kin-Ark Oil
$279,000 mortgage indebtedness and $45,500 outstanding
notes; to pay $70,000 outstanding accounts payable, and
for drilling of 14 additional wells and working caDital.
Underwriter
Van Alstyne, Noel & Co., New York.
—
Offering—Expected today (March 31).
Marlowe
Chemical
Co.,
Inc.
(4/5)
(letter of notification) 300,000 shares of com¬
mon Stock (par one cent).
Price—$1 per share. Proceeds
—For working capital. Business — To manufacture and
March 11
Office—17 West 44th
Underwriter—General Invest¬
home unit fire extinguisher.
sell
a
St,
ftew York 36, N. Y.
ing Corp., New York.
bidders:
petitive bidding.
Feb.
D. C.
if Mallinckrodt Chemical Works, St. Louis, Mo.
March 29 filed 40,000 shares of cumulative preferred
Rome, N. Y., at the rate of five shares
Na¬
tional stock held of record April 8, 1955. The offer is
$24.75 per share. Proceeds—For construction program.
Underwriters—Blyth & Co. Inc., New York, and J. J. B.
by comStatement withdrawn Feb. 11, 1955.
Office—201 Boston Building, Salt
Underwriter—Kastler Brokerage Co.,
mining expenses.
Lake
Trust Co. of Rome,
Proceeds—For investment.
1984. Proceeds—To redeem $10,000,000 of 3%%
first mortgage bonds due 1981 and
$10,000,000 of 3%%
first mortgage bonds due 1983, and for
general corpo¬
rate oiirnnse*.
Underwriter—To be determined
*
York City.
Securities Corp., New
Lucky Lake Uranium* Inc., Salt Lake City, Utah
Feb. 9 (letter of notification) 8,000,000 shares of capital
stock. Price—At par (two cents per share). Proceeds—
March
Fund, Inc., New York
filed 50,000 shares of capital stock. Price—At
of record
June 1,
■
of Marine Midland stock for each share of Farmers
To
working
;
,
working capital; and other general corporate purposes. ■
Office—248 Herricks Road, Mineola, N. Y.
Underwriter
—Aetna
—
Feb.
Underwriter—None.
if Lindly & Co., Inc., Mineola, N. Y. (4/11)
v
March 24 (letter of notification) 200,000 shares of com¬
mon stock
(par 10 cents). Price—$L50 per share. Pro¬
ceeds—To pay long term loan; to develop arid manu¬
facture automatic textile inspection machine; and for
Offices
—Natanya, Israel, and New York, N. Y.
• Johnston
stockholders. Proceeds—For equipment,
capitaL Office—900 Market St.,
and working
Wilmington,a Del.
$10,000,000 of series 10 instalment face amount certifi¬
Plantations,
Offi^-305.
Fuller
supplied by amendment.
Inc.
cates; $75,000,000 of series 15 certificates; and $125,000,-
Pecan
coil springs.
Brooklyn 1*. N. Y. Underwriters—S. D.
Co., and Vermilye Brothers, both of New York.
Cook
00 of series 20 certificates.
(4/12)
Inc.
Spring Co.,
March
plant
(par $1).
Underwriter—
Syndicate
(by amendment) an additional $1,000,000
fully-paid face amount certificates (single payment);
28
>
Minneapolis, Minn.
.
Nov 3 (letter of notification) 13,000 shares of preferred b
stock (par $10) and $170,000 of 8%. subordinate notes/
due five years from date of issue. Price—At par. Pro¬
ceeds—To reduce bank loans and for working capitaL f
Office—305 Northwestern Federal Bldg., ^Minneapolis, >■
Minn. Underwriter—Daniels & Stailth, Incv same city.
"■
of
Feb.
Underwriter—None.
Seattle 4, Wash.
807 Fourth Ave.,
March 2' filed
market.
(4/13)
Price—To be supplied by amendment. Proceeds—To sell¬
ing stockholders.
Office—Phoenix, Ariz.
if Inter American Industries, Inc., New York.
25 filed 150,000 shares of common stock (par 10
March 22
Gross
March 21 filed 193,000 shares of common stock
other general corporate
Underwriter—/Woods & Co., Houston, Tex.
if Lamson Aircraft Co., Seattle, Wash.
Feb.-28 (letter of notification) 16,734 shares of common'
stock. Price—At par ($10 per share). Proceeds—To re-;
tire bank loans, etc. and for working capital.
Office—
operating capital for its two subsidiaries,
as
March
cents).
Israel
Proceeds—For plant im¬
provement and other general corporate purposes.
(letter of notification) 300,000 shares of com¬
Price—At par ($1 per share). Proceeds—To
9
outstanding debt and for
pay
For
writer—None.
& Sons, Inc., Allentown, Pa.
(letter of notification)
1,279 shares of common
(no par) to be offered for subscription by stock¬
stock
Corp.
thers & Co., Inc., New York, on a "best-efforts basis."
March 18 filed 99^914 shares of common stock (par $10)
to be offered for subscription by common stockholders
each 20
Finance
&
and to finance establishment and operation of additional
and
ic Gerber Products Co., Fremont, Mich.
Sulz¬
Feb. 17 filed 2,500,000 shares of class A non-voting com¬
mon stock (par $1).
Price—$1.25 per share. Proceeds—
loan and finance offices.
Price
HalloweR/
Inc., New York).
ferred
$50).
Ll7rideih?wnters—Milton
berger & Co., Philadelphia; and'Baruch Brothers & Co.,
To be
(par
and to pay*e<e®tain bank
payable of Eby.
if General Telephone Co. of Michigan (4/18)
March 29 filed 100,000 shares of $2.40 cumulative pre¬
stock
Price—To be supplied by
stockholders.
purchase'pieie^edi^ock of
Hugh H. Eby Co., at par; to purchh^-rtod-estate, ma¬
chinery and equipment, etc.>;foF ,;tKe a£#a^iOn of all
D.
Inc.
(par $1).
Price—$5 per share. Proceeds—For plant expansion, new
equipment, inventory and working capital.
Office—
Huntington Station, L. I., N. Y. Underwriter—S. D. Ful¬
ler &
Manufacturing Co., Inc.
March 9 filed $3,000,000 of 6% debentures due March 1,
1975, of which $2,596,600 principal amount are to be
amendment.
amendment.
Dallas, Texas
stock.
mon
materials
Hardware
Industrial
March 11 filed $40,000,000 of
General
Laan-Tex Oil Corp.,
March
f
E. Rivett. Price—40 cents per share, U. S. tunas.
— For
development and exploration expenses.
Underwriter—To be named by
first to present
Underwriter—None.
derwriter—None.
•
Proceeds
1955
of common stock (par $1, *
shares are to be offered in
160,000 shares for account
Main St.,
both of New York.
ic Hub Loan Co., Jersey City, N. J.
28 (letter of notification) 300,000 shares of com¬
mon class A
limited voting stock (par 25 cents). Price
—$1 per share. Proceeds—For general corporate pur¬
poses.
Office — 133 Newark Ave., Jersey City, N. J.
Underwriter—Lehman Brothers, New
working capital.
York, N. Y.
if Gair
& Barnett,
Ltd., Toronto, Can.
Aug. 2 filed 660,000 shares
Canadian), of which 500,000
behalf of the company and
of Percy
Thursday, March 31,
Leo Finance Co.,
writer—None.
stock
Pearl St.,
...
purposes.
Me.
March
if Franklin National Life Insurance Co.
March 11 (letter of notification) 6,000 shares of common
stock (par $10).
Price—$50 per share. Proceeds—To
increase capital and surplus. Office—108 W. Washington
St., Greenville, S. C. Underwriter—None.
Lake Lauzon Mines,
the company to enable
tion program.
ment
Chronicle
The Commercial and Financial
(1542)
Mascot
»
5
^ 1
Mines, Inc., Kellogg, Ida.
*
:
(letter of notification) 200,000 shares of common
stock (par 35 cents). Price—75 cents per share. Proceeds
—FoV mining expenses. Underwriter—Standard Securi¬
Feb./17
ties
Corp., Spokane, Wash.
ifMcRae Oil & Gas Corp., Denver, Colo.
March 24 filed
729,174 shares of common stock
(par 10
cents), of which 400,000 shares are to be sold by the
company
and 329,174 shares by selling stockholders.
Price—$4 per share. Proceeds—To repay bank loan of
secured note of $384,000; for acquisition
and the drilling of wells; and for
other general corporate purposes.
Underwriters—First
California Co., San Francisco, Calif.; and William R.
Staats & Co., Los Angeles, Calif.
$273,00 and
of
•
new
a
properties
Merritt-Chapman & Scott Corp.
Dec.
21
filed
3.018,567
shares
of
common
stock
(par
$12.50) being offered in exchange for outstanding stock
of New York Shipbuilding Corp.. Devoe & Ravnolds
Steel Corp., Marion Power Shovel
Tennessee Products & Chemical
the following basis: 675,549 shares to holders
Co.,
Inc.,
Co.,
Osgood
;Corp.
on
Newport
Co.
and
&Ollhe 540,439 outstanding shares of common stock
$5)
of Tennessee
Products
&
(par
Chemical Corp., at the
Volume 181
rate
of
1*4
Number
5416
.
.
The Commercial and Financial Chronicle
.
shares for each share of
common
stock
of
Tennessee; 755,105 shares
to holders of the 453,063 out¬
standing shares of class A stock (par $2) of Devoe &
Raynolas Co., Inc. at the rate of 1% shares for each
share of class A stock of Devoe;
242,700 shares to holders
of the 182,025
outstanding shares of class B common
stock (par $1) of Devoe, at the rate of 114 shares for
each of class B
stock of
common
Devoe; 1,290,252 shares
to holders of the
1,290,252 outstanding shares of common
stock (par $1) of New York
Shipbuilding Corp., at the
rate of
share for each share of
one
stock of N. Y.
common
Shipbuilding; 27,907 shares to holders
of the 58,605 out¬
standing shares of common stock (par $1) of Newport Steel
Corp., not owned by Merritt, at the rate of one share
for each 2.1
shares of
common
stock of
Newport; 26,114
shares to holders of the
17,409 outstanding shares of
common stock
(par $10) of Marion Power Shovel Co.,
not
owned
by
each share of
Merritt,
the
at
stock
common
of
rate
lVz
shares
for
of
Marion; a'hd 940 shares
holders of the 1,410
outstanding shares of class B
common stock
(without par value) of the ^Osgood Co.,
not owned by Merritt or
Marion, at the rate of one share
for each 114 shares of class B common stock of
Osgood.
Offer will expire on
April 15. Dealer-Manager—A. C.
Allyn & Co., Inc. for Devoe & Raynolds exchange.
to
Mesa
Petroleum Co., Inc., Wichita, Kans.
(letter of notification) 75,000 shares of common
(no par). Price—$4 per share. Proceeds—To com¬
plete wells already drilled on properties owned by
company; and to drill additional wells. Office—303 In¬
Feb.
9
stock
surance
C.
Building, Wichita,
Schenkosky, same city.
Kans.
Underwriter—Albert
Metallics Recovery Corp.,
Florence, Colo.
14 (letter of
notification) 600,000 shares of com¬
stock
mon
it Nevada-Utah
Uranium & Oil Corp.
(4/4)
it Pioneer Loan Co., Phoenix, Ariz.
March 18 (letter of notification) 1,175,000 shares of com¬
mon stock
(par 10 cents). Price — 25 cents per share.
B common stock
Proceeds—For
ceeds-^-For
St., New York City.
16
filed
22,500
shares of
den, N. J.
it Price
common
sold
the
to
underwriters of the
400,000 shares of
boratories.
March
stock issuable
of The
Norden La¬
•
chase
materials and
raw
ing capital.
new
Underwriter
Proceeds—For general
cor¬
machinery, and for work¬
D.
Newman
&
Co..
Miami, Fla.
Micro-Moisture Controls, Inc.
13 (letter of
notification) $250,000 of 6%%
Jan.
income
convertible debentures
(subordinated) duo Feb. 1, 1965,
offered initially to stockholders.
Price—100% of
par (in units of $100 or multiples thereof).
Proceeds—
For working capital, etc.
Office—22 Jericho Turnpike,
Mineola, N. Y. Underwriter—None.
to
be
Military Investors Financial Corp.
(letter of notification) 150,000 shares of common
(par 25 cents). Price—$2 per share. Proceeds—
Dec. 1
stock
For
general corporate
Houston, Texas.
Office—2310
purposes.
Underwriter—Cobb &
Main
Co., Inc.,
St.,
same
city.
Electric
&
Co.
being offered for subscription by
March
16
the
on
basis
common
of
one
(par $10)
stockholders
new
share
ceeds—For
stock
mon
(letter of notification) 599,200 shares of com¬
(par 10 cents). Price — 50 cents per share.
Proceeds—For oil
and
activities.
gas
St., Siloam Springs, Ark.
ment
•
Office—518
Main
Underwriter—Dewitt Invest¬
Co., Wilmington, Del.
Model Finance
Service, Inc.
Feb. 28 filed $600,000 of 6% subordinated
with detachable
total of
common
stock purchase
18,000 shares of $1
warrant for
30 shares
par
for each
value
debentures,
warrants for
common
stock
$1,000 debenture)
a
(a
to be
Office—Jackson, Mich. Underwriter—Paul C. Kimball
& Co., Chicago, 111.
Offering—Expected first or second
week of April.
Mohawk
Business
Machines
Pierce,
(letter of notification) $175,000 of convertible
three-year notes. Price — At 100% of principal amount.
Proceeds—To reduce accounts payable and other general
corporate purposes. Office—944 Halsey St., Brooklyn 33,
N. Y.
Montezuma
Uranium, Inc., Denver, Colo.
Jan. 5 (letter of notification) 3,000,000 shares of~com¬
mon stock
(par five cents). Price—10 cents per share.
exploration
and
development operations.
Office^—Ernest and Cranmer
Bldg., Denver, Colo.
derwriter—Investment Service Co., same city.
National
Feb.
28
Un¬
ceeds—To
Fenner
464,325
shares of
six
each
for
shares
held;
rights to expire on April 4,
1955.
Price—$40 per share. Proceeds—For "Capital ex¬
penditures and working capital.
Underwriters—W^E.
Hutton & Co. and Blyth & Co.,
Inc., both of New York.
it National Homes Corp., Lafayette, Ind.
March 11 (letter of notification) 2,600 shares of classf B
common
stock
(par 50 cents) to be offered to employees
its subsidiary, National Homes Accept¬
of company and
ance
Corp.
Price—Based
offering price of $58'per
share, employees are to pay from one-half to two-thirds,
according to term of service, and company to contribute
balance.
Proceeds—For working capital.
Office—U.£S.
52 By-Pass, Lafayette, Ind. Underwriter—None.
National
March
7
Shares
on
Corp., New York
360,000 shares of capital stock (par $4)
being offered for subcription by stockholders of record
March
21
on
shares held
to
expire
For
on
the
basis
fwjth
an
A$Hl 4.
investment.
of
one
new
share
for
each Two
oversubscription privilege); rights
Price—$15
per
Underwriter—None.
share.
Procceds^■
A
the basis of
one
stock held;
Price—$105 per share. Pro¬
and for property
bank loans
bank loans
reduce
and for construction pro¬
it Pacific Lighting Corp.
March 30 filed 600,000 shares of common stock (no par).
Price—To be supplied by amendment. Proceeds—To re¬
March 7
Purex
Pacific
Northwest
Pipeline Corp. (4/11-15) *
$17,220,000 of 6% interim notes due June
1, 1957 and 287,000 shares of common stock (par $1) to
be offered in units of $60 principal amount of notes and
liam R. Staats &
March 9 filed
share of stock. Price—To be supplied by amendment
(expected to be $70 per unit). Proceeds—Together with
other funds, to finance construction of a
1,466 mile
natural gas pipe line between Ignacio, Colo., and
Sumas,
the Canadian border. Underwriters
White,
Co.; Kidder, Peabody & Co.; The Dominion Se¬
curities Corp.; and Union Securities Corp.
Financing
plans also include offering to present stockholders of
1,549,100 shares of common stock $10 per share, without
underwriting.
on
—
Weld &
•
Pan
business.
•
held; rights to expire about April 20.
100% of principal amount.
Proceeds
it Raytheon Manufacturing Co., Waltham, Mass.
28 (letter of notification) 4,800 shares of common
stock
Trice—
Underwriter—None.
it Re-Mark
March
Chemical Co., Inc., Miami, Fla.
(letter of notification) 187,525 shares of class
15
A 10% cumulative preferred stock
per
share.
chase
of
capital.
$23,682.09. Office—132 Mercan¬
Dallas 1, Texas.
Underwriter—
Proceeds
accounts
—
None,
•
Reis
(Robert)
receivable,
be
stock
(par $1)
stock
and 2,500 shares of 5%
(par $100).
Price—At
cumulative
furnishings
and
fixtures.
Road, Scottsdale, Ariz.
Office—4523
pre¬
company.
& Co.
facilities, and
Scottsdale
Revere
Underwriter—None.
Realty, Inc., Cincinnati, Ohio
stock
share for stock.
for
subscription by common stockholders
April 15 on the basis of one new share for each
five
held; officers and employees to be entitled to
purchase any unsubscribed shares. Rights will expire
on
May 2. Price—To be supplied by amendment. Pro¬
ceeds—For construction program.
Underwriters—Mor¬
gan Stanley & Co.
and Coggeshall & Hicks, both of
15
filed
Ritter
unit.
Houston, Tex.
shares of capital stock
ston
one
Oil stock
new
held
working
Miami, Fla.
Inc.,
160,000 shares of
supplied
be
common
.
stock (par $5).
amendment.
by
Proceeds—To
to Great Southern Trucking Co., for equity
in
Ryder Truck Rental System, Inc.; for
working capital; and expansion of Ryder System and
subsidiaries.
its
York.
purchased by other Johnston Oil stockholders. Price
—$1 per share. Proceeds—For geological and other ex¬
Jan. 6 (letter of
stock
Underwriter—Blyth
Offering—Expected
San Miguel
Un¬
derwriter—None.
(par
one
some
& Co., Inc.,
time in April.
New
Uranium Mines, Inc.
notification) 2,000,000 shares of common
cent). Price—15 cents per share. Pro¬
ceeds— For
^ Philadelphia Electric Co. (4/18)
29 filed 550,000,000 of first and refunding mort¬
gage bonds, due 1985.
Proceeds—To redeem $30,000,000
mining operations. Office — Mineral Bldg.,
Junction, Colo. Underwriter — Tellier & Co.,
Jersey City, N. J.
Grand
March
presently outstanding and to help finance
Underwriter—To be determined
Savannah
program.
March
17
Electric
filed
art & Co.
•
165,000
&
Power
shares
Co.
(4/14)
common stock
(par
$10), of which 65,000 shares are to be offered tor sale
by the company and 100,000 shares by the Donner Fam¬
Probable bidders: Halsey, Stu¬
Inc.; The First Boston Corp.; Morgan Stanley
& Co. and Drexel & Co. (jointly); Kuhn, Loeb & Co.
and Union Securities Corp. (jointly); White, Weld &
Co.
Bids—Expected to be received up to noon (EST)
on April 18.
and "for
repay debt
investment
(or represented by warrants held).
by competitive bidding.
reduce bank loans
Price—To
not
of 3%% bonds
Inc.,
March 28 filed
share for each four shares of John¬
and for other general corporate expenses.
Co.,
Underwriter—None.
it Ryder System,
Johnston Oil has agreed to purchase any company shares
penses,
■
Finance
Proceeds—To
capital.
(par 10
cents), of which 195,714 shares are to be offered by com¬
pany and 304,286 shares by a selling stockholder, to be
offered for subscription by stockholders and warrant
holders of Johnston Oil & Gas Co. of record April 1 on
the basis of
—
Underwriter—Stanley Cooper Co., Inc.,
Syncote, Pa.
Feb. 24 filed 4,000 shares of 5V2% cumulative preferred
stock, third series (par $50) and 40,000 shares of class
B common stock (par $1) to be offered in units of one
preferred share and 10 class B shares. Price—$75 per
Inc.,
500,000
Price—Par for debentures and $100 per
Proceeds
To purchase real estate or
Cincinnati, O.
York.
March
(no par).
interest therein.
of record
Petro-Minerals,
No general
March 8 filed $1,000,000 of 5V2% cumulative convertible
debentures due Jan. 1, 1980 and 25,000 shares of common
^ Peninsular Telephone Co., Tampa, Fla. (4/18)
158,203 shares of common stock (no par)
offered
<
and
,
March 25 filed
be
shares of $1.25
3,000
stock (par
Underwriter—Lehman Brothers, New York.
offer expected.
Proceeds—For
No.
working
18,000 shares of
$1). Price—At market (about $9 per
share for preference stock and about $1.25 for common^u
stock). Proceeds—To Trust of Arthur M. Reis. deceased.''"
common
par.
and
St., Miami, Fla. Under¬
through Paul H.
offered
15 (letter of notification)
prior preference stock (par $10)
March 16 (letter of notification) 50,000 shares of common
ferred
of loans, repur¬
inventory
73rd
March
it Paradise Valley Raquet Club, Inc.
Scottsdale, Ariz.
(par $1). Price—$1.25
For retirement
shares to
Marks, Secretary of
None.
—
Office—64 N. E.
writer
was
Bldg.,
issued upon exercise of stock options to
Price—At market (estimated at $25.68V2
Proceeds—For general corporate purposes.
share).
per
^ Panhandle Oil Corp., Dallas, Texas
(letter of notification) 2,950 shares of common
stock (par $1) to be issued pursuant to employees' stock
purchase plan (such shares were purchased in the open
market for the aggregate amount of $23,181.92, or at an
average cost*of $7.86 per share).
Total contribution by
Securities
(par $5)
four employees.
March 16
tile
share. Proceeds—For gen¬
Underwriter—James Anthony
per
purposes.
Feb.
capital. Underwriters—Kuhn, Loeb & Co. and Carl M.
Loeb, Rhoades & Co., both of New York.
employees Lor 1954
corporate
Securities Corp., New York.
For working
—
(4/4)
(par 10 cents). Price—$1
eral
filed
April 6 at rate of $100 of debentures for each 40 shares
stock
Underwriter—None.
Ranger Lake Uranium Mines, Ltd., Toronto,
Canada
American
18
Co., both of Los Angeles, Calif.
Dec. 30 (regulation "D") 300,000 shares of common stock
Sulphur Co., Dallas, Texas (4/7)
$4,651,200 of subordinated debentures,
due April 1, 1967 (convertible until April 1, 1964) to be
offered for subscription by stockholders of record about
March
'
Pyramid Life Insurance Co., Charlotte, N. C.
I
Feb. 15 filed 250,000 shares of capital stock (par $1) to
be offered for subscription by common stockholders of
record March 1, 1955 on the basis of one new share for
each three shares held.
Any shares remaining unsub¬
scribed 30 days following date of mailing of warrants
will be dispo^bd of through the company's executive
committee. Price—$3.75 per share. Proceeds—To expand
one
Wash,
Corp., Ltd.
(letter of notification) 3,932 shares of common
stock (par $1). Price—At market. Proceeds—For working capital. Underwriters—Blyth & Co., Inc., and Wil¬
bank loans and for advances to subsidiaries. Under¬
construction
filed
May 9.
on
common
-
Underwriters—Morgan Stanley & Co.; Drexel &
Co.; and Glore, Forgan & Co. Offering — Temporarily
delayed.
New
stock
(pat $1)
being offered for subscription by common stockholders
of record March 21, 1955 at the rate of one new
share
common
pre¬
gram.
Gypsum Co.
filed
(4/14)
shares of cumulative preferred stock
Price—To be supplied by amendment. Pro¬
to
Underwriter—None.
Proceeds—For
on
repayment of
(par $100).
Beane, New York.
construction of clubhouse and recreational
Corp.
March 18
Inc.
Dec. 22 filed 250,000
offered in units of
a $500
debenture, plus a warrant for
purchase of 15 shares of stock at $2 per share.' Price—
$500 per unit. Proceeds—For payment of certain notes.
Indiana,
$100
Public Service Electric & Gas Co.
—
Lynch,
80,000
Underwriter—None, v
additions.
eight shares held. Employees will be given the
to subscribe for not exceeding 12,000 shares of
any unsubscribed stock.
Rights will expire on April 5.
Price
$31.50 per share. Proceeds — For construction
At
(4/1)
March 17
par
rights to expire
for
right
Underwriter—Merrill
of
Inc.
additional
shares of 4.20% cumulative
preferred share for each 21 shares of
each
of
it Millsap Oil & Gas Co., Siloam Springs, Ark.
Co.
an
At market. Proceeds—
—
stockholders of record April 13
mon
Gas
Price
(convertible into common stock
after July 1, 1956) to be offered for subscription by com¬
Feb. 23 filed 331,643 shares of common stock
•
Frank
—
Service
stock,
writer—Blyth & Co., Inc., San Francisco and New York.
Co., Hialeah, Fla.
Public
ferred
—Universal Securities Co., New York.
Mi-Ame Canned Beverages
amendment)
Norden-Ketay stock for each four warrants
pay
Oct. 28 (letter of notification)
200,000 shares of common
stock. Price—At par ($1 per
share). Proceeds—To pur¬
Growth 5tock Fund,
(by
18 filed 202,431
Oklahoma
program.
filed
March
are
porate purposes.
record
24
entitled to receive
exercised at $12 per share.
of
Underwriter—None.
(T. Rowe)
shares of capital stock.
For investment.
public offering in 1951
stock
The warrant holders
share of
one
common
187,500 shares of class
Price—1.60 per share. Pro-
(par $1).
it Price & Co., Inc.
(letter of notification) 7,500 shares of capital
stock
(par $20).
Price—$40 per share.
Proceeds—To
repay bank loans and for working capital.
Business—
Broker-dealer.
Office—Broadway at Market St., Cam¬
pursuant to exercise of 90,000 stock purchase warrants
of
(letter of notification)
March 29
Norden-Ketay Corp., New York
March
14
working capital. Address—c/o Fennemore,
Craig, Allen & Bledsoe, 404 Phoenix National Bank
Bldg., Phoenix, Ariz. Underwriter—None.
.
^ New Yorker Magazine, Inc.
March 23 (letter of notification) 3,000 shares of
common#^
stock (par $1).
Price—$30.50 per share. Proceeds—To
Raoul H. Fleischmann, the selling stockholder.
Office
—25 West 43rd St., New
York, N. Y. Underwriter—
Silberberg & Co., New York.
(par five cents). Price—50 cents per share.
Proceeds—For general corporate purposes. Underwriter
-
March
exploration and development expenses.
Underwriter—Chippewa Securities Corp., 226 West 47th
&
March
51
(1543)
of
ily Trusts and Donner Foundation, Inc. Price—To be
supplied by amendment. Proceeds — To repay bank
Continued
i
on
page
52
^
'
Continued from page
51
'rv'
be
<
construction. Underwriters—The First
loans and for new
(4/5)
March 4 filed
March 16 filed 100,000 shares of common
stock (par $10),
of which 50,000 shares are to be offered by company and
50,000 shares by selling stockholders. Price—To be sup¬
basis of
March
Underwriter—A.
G.
Silver
Nov. 22
working capital.
Office
Uranium, Inc.,
Nov.
(letter of nouiicauon; z,i>y4,uou snares of com¬
(par five cents). Price—10 cents per share
stock
mon
Froceds—For
development
and
costs.
•
Sinclair
7
Oil
Corp., New York
struction.
337,830 shares of common stock (no par)
being offered in exchange for shares of capital slock of
in the ratio of five
Co.
Solomon
^ct. 7
&
Oil
Texas
jfron stock
(par one cent).
2,uo0,0ou
Price
—
shares
10 cents
of
com-
per
expenses.
Offices —
Bldg., Salt Lake City, Utah, and 1016 Baltimore Bldg
Kansas City, Mo. Underwriter—E. R. Bell & Co., Kansas
City, Mo.
75
due
1965
be
to
shares
For
and
offered
of
4,500 shares of
in
stock.
purchase
of
units
of
common
stock
obligations
(par
working capital. Office—100 West 10th St., Wilmington,
Underwriter—None.
Public
Service
Uranium
12
Feb.
facturing
3Y2 Southeastern shares for each Hamilton share. This
offer shall terminate when offer shall have been
accept¬
ed by Hamilton stockholders
Southern
in-excess
Oil
25
costs
of
Office—70 Pine St., New
for
acquisition of interests in other oil
Office
Graves & Co.,
•
Southern
Laurel, Miss.
—
Underwriter
—
each
share
and to
sale
-
public, at
To
Stock
—To
(ex-rights)
Co., Inc., New York.
Springfield, Mass.
19,997 shares of
Co.
New
common stock
(par $5).
Proceeds—For investment.
Star Uranium
Corp., Salt Lake City, Utah
(letter of notification) 6,000,000 shares of com-»
mon stock
(par one cent). Price—Five cents per share
Proceeds
For
exploration and development costs
Underwriter—Ned J. Bowman Co, Salt Lake
City, Utah
Aug. 2
—
Stardust, Inc., Reno, Nev.
July 9 filed 621,882 shares of preferred stock (par
$10)
621,882 shares of
stock (par one cent) to be
share of each class of stock. Price
common
one
—$10.01 per unit. Proceeds—For purchase of land
and
construct and
equip
a
to
luxury hotel. Underwriter—None
Stewart Oil & Gas Co., San Angelo, Texas
;
March 14 filed 750,000 shares of
price
$1
per
share.
common
and
operations.
Herrick
<•
&
Storer
—
reduce
Broadcasting Co.
To
be
shaies
$100) at $107
New
activities
Underwriter
—
inci¬
Barrett
(4/6)
common
by amendment.
due 1955-1961, by
of
per
7%
or
cumulative
share.
York.
and
stock
(par $1).
Proceeds
—
To
approximately
part of the outstanding
preferred stock (par
Underwriter—Reynolds
& Co
;
Sun
Feb.
*'
Hotel, Inc., Las Vegas, Nev.
16_filed 760,000 shares
apd
1,540,000
shares
of
of pfd. capital stk. (par $9.50)
common
capital stock (par 25
-;cents)_, of which 680,000 shares
of preferred and
1,360,000
preferred and
spares are to be offered in units of
one
Jxyq common shares; the remaining
80,000 shares of
ferred.stock and *180,000 shares of
common
stock
corporate
200,000 shares of
share.- Proceeds
per
Office—1416 Chestnut
purposes.
■
Wallace, Idaho.
Uranium
pre¬
may
Canada
Ltd., Toronto,
Mines,
Stone
&
purposes.
three weeks.
or
Wenga Copper Mines, Inc., N. Y.
Nov.
18
(Regulation "D") 900,000 shares of common "
stock <par five cents). Price—30 cents per share. Pro¬
ceeds—For general corporate purposes.
UnderwriterWillis E. Burnside & Co., New York.
;
;
West Coast Pipe Line Co.,
Dallas, Tex.
filed $29,000,000 12-year 6% debentures
due Dec. 15, 1964, and 580,000 shares of common stock
(par 50 cents) to be offered in units of one $50 deben¬
ture and one share of stock.
Price—To be supplied by
amendment.
Proceeds—From sale of units and 1,125,000
additional shares of common stock and private sales of
$55,000,000 first mortgage bonds to be used to build a
1,030 mile crude oil pipeline. Underwriters — White,
Nov.
20,
Weld
par
&
York.
1952
Co.
Union
and
Securities
Corp., both of New
Offering—Postponed indefinitely.
as¬
West Coast
Pipe Line Co., Dallas, Tex.
filed 1,125,000 shares of common stock (par
cents). Price—To be supplied by amendment. Pro¬
ceeds—Together with other funds, to be used to build
pipeline. Underwriters—White, Weld & Co. and Union
Securities Corp., both of New York.
Offering—Post¬
poned indefinitely.
Nov. 20, 1952
to
Underwriters—White, Weld
Webster Securities
Corp., both
Price—$1 per share. Proceeds—For gen¬
Underwriter—James Anthony
Offering—Expected in two
(par 10 cents).
corporate
pre¬
program.
(regulation "D") 300,000 shares of common stock
eral
50
West Texas
Utilities
Co.
(4/6)
March 9 filed $7,500,000 of first mortgage bonds, series
due April
&
loans
of
D,
Proceeds—To be used to retire bank
1, 1985.
for
and
construction.
new
determined
Price—$400 per unit. Proceeds—For purchase of
property, construction of hotel, athletic and health facile
—Expected
April 6.
to
ities, and working capital. Underwriter—None, but sales
will be made through agents.
Jan.
Underwriter
—
To
be
by
York.
Union
March
and
1
Club, Inc., Hollywood, Calif.
100,000
offered
•
filed 30,000 shares of preferred stock
in
shares
units
of
of
common
three
stock
preferred
(par
and
(par $50)
$10)
10
to
be
common
shares.
it United Funds, Inc.,
March 28 filed
000
Kansas City, Mo.
50,000 United Income Fund shares; 100,-
Accumulative
Fund
shares; 50,000 United Science
shares; 100,000 Ubited . Continental Fund shares;
$20,000,000 Period Investment Plans (without insurance)
and underlying shares of United Accumulative
Fund;
and $1,000,000 Period Investment Plans
and
underlying
shares
of
United
(with insurance)
Accumulative
Fund.
Proceeds—To
debt, buy equipment and machinery
and for working capital. Business—Manufactures a new
type of spark plug. Underwriter — Allen E. Beers Co.,
pay
Denver, Colo.
Jan. 26 (letter of notification) 4,133,329 shares of com¬
mon stock (par one
cent), of which 2,133,329 shares are
covered by an offer of rescission to 37 shareholders at
per
share;
and
up
to
10:30
a.m.
,(CST)
on
Hills
Inn, Fort Worth, Texas
shares of capital stock (no par).'
Price—$5 per share.
Proceeds—Together with other
funds, to construct, furnish and equip hotel to be built
31
filed
between
200,000
Dallas
and
Fort
Worth, Texas.
Underwriter—
Schwanz & Co., Inc.fi Aurora, 111.
^Western Light & Telephone Co., Inc.
,
'
March 30 filed 57,000 shares of common stock
to
be
at
rate
offered
of
for
one
be
subscription by
new
share
supplied
by
retire bank loans and for
.—Dean
Witter
&
for
seven
(par $10)
stockholders
shares
Proceeds
construction.
held.
—
To
Underwriter
Co., San Francisco, Calif.
Medford,
Ore.
(letter of notification) 2,990 shares of
stock,. Price—At par
down
each
amendment.
new
it Western Products Corp.,
March 23
common
($10
per
share).
common
Proceeds
—
For
payment on plywood plant and for working cap¬
Office—1016
N.
Riverside,
Medford, Ore.
Under¬
writer—None.
Uranium Corp.,
cents
be received
y'
Western
ital.
Philadelphia, Pa.
three
competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc. and Salomon Bros. &Hutzler(jointly); Merrill,
Lynch, Pierce, Fen¬
ner & BeanefT£quitable Securities
Corp.; Glore, Forgan
& Co.; Kuhn, Loeb & Co. and Lehman Brothers (joint¬
ly); Kidder, Peabody & Co.; The First Boston Corp. Bids
Price—To
it U. S. Igniter Corp., Philadelphia, Pa. (4/4)
March 18 (letter of notiifcation) 100,000 shares of class
A common stock (par 50 cents).
Price — $3 per share.
United
f
Proceeds—For
Proceeds—For investment.
supplied
4 %%
notes,
$10,000,000; and to redeem all
15,000
stock
Co, Inc., New York.
March 10 filed 262,750 shares of
Price
other
notification)
Price—$1.25
of
(letter of notification)
Webster
Los Angeles, Calif.
common stock (par $1),
to be offered publicly. Price
Fund
(par lOd).
Proceeds—To repay bank loan, and
for development of
properties
dent to oil and gas
15
Hotel,
Electronics
improvements;
construction
share.
offered in units of
Corp.
(letter
Mines, Inc., Wallace, Idaho
1,500,000 shares of com¬
mon stock.
Price—At par (five cents per share). Pro¬
ceeds—For expenses incident to mining operations. Ad¬
dress—P. O. Box 289, Wallace, Idaho. Underwriter—Alden J. Teske, d/b/a Wallace Brokerage Co., Samuels
Oct.
^Transcontinental Gas Pipe Line Corp. (4/27)
March 29 filed 150,000 shares of: cumulative preferred
stock (stated value $100 per share).
Price—To be sup¬
plied by amendment. Proceeds—To finance part of 1955
Price—$10
and
—
Ave., Hillside, N. J. Underwriter—None.
Manufacturing Co.; for
purchase one-half interest
in parking area presently leased from Gira Co.; and for
working capital, etc. Underwriter—Dempsey-Tegeler &
Co., St. Louis, Mo.
March 22 filed
per
Standard
leasehold
—
Corp.,
10
—For general
153,500 shares of
139,500 shares are
supplied by amendment.
be
of
sets
price to be equivalent to last
Exchange—65c-75c
Securities
Price—To be supplied by
payment of rentals; $46,000 to retire outstanding $10
preferred stock; to purchase substantially all § the
J>ev share. Proceeds—For exploratory and developmental
expenses; for possible acquisition of additional oil and
gas interests; and to meet current liabilities.
OfficeToronto, Canada. Underwriter
Willis E. Burnside &
• Springfield
1966.
Topp Industries, Inc.,
March 15; rights to expire on
stockholders, 50 cents per share;
a market
Toronto
on
of
as
—
Vandersee
March
Class A stock (par $1).
plant
of which
Union
held,
:
York.
Proceds—To construct and operate a manu¬
March 9 filed
Inc., New York.
Price
Springfield^ Mass.
Co.,
£1* rights to expire on April 7. Price—$14 per share. ;
proceeds—To reduce bank loans and note held by in- *
surance company, and for working capital.
Underwriter
—Paine, Webber, Jackson & Curtis, Boston and New /
com¬
Gordon
16 filed
April 12.
Norman
shares of commoru/Stoek (^ar $2.50) *
and
10-year warrants to purchase 124-667 additional ,
shares of common Stockt beii^
for<subscription ^
by common stockholders in uaitsi/of >o«e share of' com¬
mon
stock and one warrant for, thevpurchase of one r
additional share for each three shares held on March
Tip Top Uranium & Oil, Inc., Denver, Colo.
1 (letter of notification) 30,000,000 shares of com¬
mon
stock.
Price—At par (one cent per share).
Pro¬
ceeds—For mining expenses.
Office—1122 Mile High
Center, Denver 2, Colo.
Underwriter—Robert W. Wil¬
son, 1717 East Colfax Ave., Denver, Colo.
Oils, Ltd.
1,211,002 shares of common stock (par $1)
of which 511,002 shares are
being offered for subscription
by existing stockholders on a basis of one new share for
Feb.
Van
Feb.
Co.
filed
and
panies.
River, Mass.
near Orange, Tex., for the purpose
of
insulation
building products.
Under¬
writer—Emerson Cook Co., Palm Beach, Fla.
(4/4-7)
250,000 shares of common stock (par one
cent). Price—$2 per share. Proceeds—For further ex¬
ploration and development of properties, for drilling
Feb.
mining expenses.
Office—280 Aultman
Underwriter—Bristol Securities Co., Fall
St., Ely, Nev.
manufacturing
Underwriter—None.
States
notification^ 2,000,000 shares of comPrice — 15 cents per share.
(par one cent).
Proceeds—For
series B convertible debentures due serially from
1, 1962 to Aug. 1,
of
owning not
stock
mon
Securities Corp., New York.
amendment.
5, N. Y.
(letter of
Jan. 17
of 6%
Co.
(letter of notification) 28,000 shares of common
(par 10 cents) being offered in exchange for
Gas Corp. capital stock (par $1) on the basis
8,000 shares of Hamilton stock.
Washington, D. C.
Dec. 30
Hamilton
York
"Uranium Digest."
Texboard, Inc., Dallas, Texas
Jan. 17 filed $1,500,000 of 6% series A debentures due
serially from Feb. 1, 1957 to Aug. 1, 1961, and $1,000,000
Jan. 24
stock
"best ef¬
working capital. Office—823 Wilson Bldg., Corpus
Christi, Tex. Underwriter — Lentz, Newton & Co., San
Antonio, Tex.
Dei:
Southeastern
on a
and
for
and
connection with publication of a monthly;
Underwriter — Lewellen-Bybee Co.,
in
penses
'
Development Corp.
(letter of notification) 298,000 shares of com-,
mon stock
(par 10 cents). Price—$1 per share. Proceeds
—For mining,
exploration and development expenses
$1,000 debenture and
Price—$1,100 per unit. Proceeds—
pay
'
of notification) 25,000 shares of common
($1 per share). Proceeds—For ex-
Price—At par
stock.
Vulcan-Uranium
Texas
March
one
machinery,
Brothers, New York,
—
Publishing Co.
Uranium
shares held;
forts" basis.
it Southeastern Industries, Inc., Wilmington, Del.
March 11 (letter of notification) $60,000 of 6% deben¬
$1)
4%
Underwriter—Vickers
,
tures
each
and 70,000 shares
are for account of certain selling stockholders. Price—To
be supplied by amendment.
Proceeds—For exploration
and drilling, and payment of bank loans and advances
share
506 Benson
Proceeds—For mining
Securities
International
share for
new
(letter oL notification;
Webster
Sulphur Co.
June 21 filed 455,000 shares of common stock (par 10
cents)1? of which 385,000 shares are to be offered for
subscription by common stockholders at the rate of one
Inc.
Corp.,
&
all of New York.
shares of
Exchange Bank, New York City.
Uranium
Stone
—
Corp.; White, Weld & Co. and Halsey, Stuart & Co. Inc.,
Sinclair stock for each eight shares of Venezuelan stock
tendered for exchange,
lhe offer will exp.re on April
21 and is subject to deposit of at least
450,000 shares
with Chemical Corn
Underwriters
J. F.
Dallas, Texas.
Feb. 28 filed 124,667
(4/6)
11 filed $25,000,000 of debentures, due April 1,
Price-Ta be supplied by amendment.,. Proceeds—
1975.
filed
Venezuelan Petroleum
Co.
To repay outstanding short-term notes and for new con¬
..
.
Transmission
working
Vada Uranium Corp., Ely, Nev.
March
,
March
Gas
Underwriter
capital.
For
Co,
—
&
March 4 (letter
(Fla.)
Racing Association, Inc.
filed
18
Tennessee
Of¬
fice—211-206 N. Virginia Street, Reno, Nev. Underwriter
—Western Securities Corp., Las Vegas, Nev.
\
exploration
Park
Perkins
of
as
$700,000 of 6% convertible sinking fund
debentures due 1966 and 70,000 shares of common stock
(par 10 cents). Price — 100% and accrued interest for
debentures and $2 per share for stock.
Proceeds—To
repay bank loans, for new construction and for working
capital. Underwriter—Gulf-Atlantic, Inc., Tampa, Fla.
Nev.
fteno,
each five shares held
for
New
Beane,
Sunshine
Underwriter—None.
Pick
share
new
Underwriters—Merrill Lynch, Pierce, Fenner
York; Bacon, Whipple & Co, Chicago,
111.; Dean Witter & Co, San Francisco, Calif.
&
High Street,
—
one
Dallas, Texas
16
Proceeds
purpeses.
it Seamloc Carpet Co., Sanford, Me.~
Feb. 28 (letter of notification) 10,000 shares of 6% cumu¬
lative preferred stock. 1 rice— At par ($10 per share).
Proceeds—For
Co.
22; rights to expire on April 6. Price—$35 per
Proceeds—For expansion and general corporate
share.
& Co. inc., Chicago, ill.
BecKer
Tool
Machine
108,885 additional shares of common stock
being offered to common sioeKholuers on the
(pvar $5)
plied by amendment. Proceeds — For capital additions
and improvements.
Office — Muskegon lie.ghts, Mich.
Sanford, Me.
City, Utah.
Sundstrand
Power Corp.
Sealed
capital.
Thursday, March 31, 1955
(letter of notification) 27,000 shares of 70-cent
cumulative preferred stock (no par) and 27,000 shares
of common stock (par 15 cents) to be offered in units
of one share of eacn class of stock.
Price—$11 per unit.
Feb.
hotel;
Underwriter—Coombs & Co.,
purchase property; for construction ot
working
Salt Lake
New York.
of
for
and
Corp. and Stone & VVeoster Securities Corp., both
..
Corp.,
Finance
Universal
Price—$10 per unit. Pro¬
exchanged for properties.
ceeds—To
Boston
Chronicle,
The Commercial and Financial
(1544)
52
2,000,000
shares
are
to
be
^publicly offered at 10 cents per share. Proceeds—For
mining expenses. Underwriter—John L. Donahue, 430
16th Street, Denver 2, Colo.
' z
*'* .\r
"V
.
•
White Canyon
Mining Co.
(4/5-6)
Feb. 4 filed 3,000,000 shares of common
stock (par 33%
share. Proceeds—To repay loans
capital acquisitions; and for expendi¬
tures and working capital.. Office—Dove Creek, Colo.
Underwriters—Joseph McManus & Co,, New York; and
cents).
Price—$1
per
and advances; for
*°A."'P." Kibbe & Co., Salt Lake City,
Utah.*
™
l
Volume
181
Number 5416
.
.
.The Commercial and Financial Chronicle'
White River
Propane Gas Co., Inc. (4/11-12)
$400,000 of 6% convertible debentures,
series A, due April 1, 1965, and 50,000 shares of common
stock (par $1).
Price—100% and accrued interest for
March
11
filed
debentures,
$6
and
share for
per
Proceeds—To
stock.
bank loans, etc., and for equipment, expansion and
working capital.' Office—Batesville, Ark. Underwriter—
repay
Eisele & King, Libaire, Stout & Co., New York.
^American Trust Co., San
March 22 it
7
March 11
Jacksonville, Fla.
133,000 shares of com¬
Inc.,
(letter of notification)
stock
mon
Par Three,
(par 10 cents).
ceeds—To build
a
golf
Price—$1.25
course.
per
share.
Pro¬
Underwriter—E. E. Smith
Co., New York.
share for each four shares held.
for
certain
properties
to
(par $1),
payment
be
acquired from American
Trading Co., Ltd. who will purchase the ,Remaining
1,000,000 shares for $455,000./Proceeds—For exploration
and development costs and working capital. Underwriter
•—None..
There
are
now
shares
presently outstanding.
Underwriter
Blyth & Co., Inc., San Francisco, Calif.
May
28
about
it
reported
was
55,000 shares of
company
offer
may
sell
and
formulate
plans
simplification of the railroad's debt
a
(par five cents).
Price—20 cents
per
share.
Pro¬
mining expenses. Office—M. L. C. Bldg.,
648, Moab, Utah. Underwriter—Security Ura¬
nium Service, K. O. V. O. Bldg., Provo, Utah. ~ -'"//iZ "?
P. O. Box
Woman's
Income
rection
of
its
President, Pierre
A.
DuVal,
of DuVal's
Consensus Inc.
Woodland Oil & Gas
Co., Inc.
(letter of notification) 299,900 shares of
Dec. 21
stock
-
For
Price—$1
(par 10 cents).
equipment,., drilling
common
Proceeds—
share.
per
expenses
E.
Broadway, New York, N. Y,
M, North Co., Inc., same address.
•
Woodward &
Underwriter—
Lothrop, Inc. (4/19) •
March 18 filed 30,000 shares of common stock (par $10).
Price
Xor be supplied by amendment.
~
of bank loans
reduction
Washington, D. C.
Baltimore, Md.^
.
and
Proceeds—For
working capital.
Office—-
Underwriter—Alex. Brown
&
Sons,
stock
mon
(par
cent).
one
Price
—
Proceeds—For exploration and
Office—323
Utah.
Newhouse
Three
com¬
cents
development
pei
ex¬
bldg.,
Wynn Pharmacal Corp.
Dec. 23 (letter of notification) 85,000 shares of class B
common
stock (par 10 cents).
Price—$2.50 per share.
.
Proceeds
For
—
company's
stock
(no par) to its stock¬
Offering
—
production,
development
and
sale
of
working capital and other corpo¬
rate purposes.
Office—5119 West Stiles St., Philadel¬
phia, Pa. Underwriter—Charles Ai Taggart & Co., same
/ city. '
"u'' •"
Expected in
products,
Price—$1
share.
per
Proceeds—To
bills and purchase equipment and supplies.
pay current
Underwriter
y-—H. P. Jesperson, 2111 Nicholas St., Omaha, Neb.
£ Yukon Placer Mining, Inc., Seattle, Wash.
March 22 (letter of notification) 300,000 shares of com¬
mon stock
(par 10 cents) and $120,000 principal amount
'of 6% promissory notes due Nov. 1, 1957. Proceeds—For
mining operations. Office—1013 Smith Tower, Seattle,
Underwriter—None.
Zenith
Dec.
31, W. F. Wyman, President, stated that company
plans to issue and sell some additional common stock
par $10 (probably to stockholders) in the latter part of
Proceeds—For construction program. Underwriter
—May be determined by competitive bidding. Probable
bidders: The First Boston Corp. and Coffin & Burr, Inc.
(jointly); Harriman Ripley & Co. Inc.; Blyth & Co., Inc.
and Kidder, Peabody & Co. (jointly).
29
it
reported
company
Blyth & Co., Inc.
Feb.
14 it
announced company
was
plans to offer to its
stockholders the right to subscribe for one new
stock for each five shares held. Stock¬
common
share of
increasing authorized com¬
mon
stock from 4,000,000 to 5,000,000 . shares.
Price—
To be determined shortly before offering is made. Pro¬
ceeds—For
construction and general corporate pur¬
new
Underwriter
it
30
was
Co.
(5/24)
to
issue and
first mortgage bonds due 1985. Proceeds
—To repay bank loans and for construction program.
Underwriter—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; Morgan
Stanley & Co.; Union Securities Corp., Equitable Securi¬
Southern
was
on
approving
of
200,000 shares
holders
a
the
on
of capital stock
basis
of
two
Price—$30 per
capital and surplus.
crease
Collins
Radio
stock (par $10) in exchange for the out¬
136,744 shares of 5V2% cumulative preferred
stock, series A (par $100) on the basis of ten shares of
6% stock for each 5,y2% preferred share held. Dealerible preferred
standing
Manager—Kidder, Peabody & Co., New York.
to
to
stockholders
that they authorize a new issue of not to exceed
j
$650,000,-
000 convertible debentures at their annual meeting to
be held on April 20.
When issued, each stockholder
would receive rights to purchase the debentures in pro¬
portion to his holdings of stock (probably on the basis *.
of $100 of debentures for each eight shares of stock
held).
Underwriter—None.
Bank,
a
period of 30 days
$10) to stock¬
(par
shares for
share.
each
seven
Proceeds—To
be
deterfnine'd'- by
&
Halsey,
Co.
and
'competitive"bidding.
Stuart
Motor
Co.,
Merrill
Corp.
/■"'/,'/"
Ford
March 15 it
to
stock
Detroit,
Mich.
,
reported that following
was
split,
an
tion
Co.
ro
4:'/
was
to be sold
are
—
Offering—Probably in June.
reported
127,500 shares of
of
shares
probable 40-
a
offering of approximately 4,000,000
Price—ExpecdetfVt
To the Eora
shares will be made to the public.
be around $60 per share.
Proceeds
★ Frite
company
plans early registra¬
common stock, of which 27,50,0
by the
by certain stockholders.
company
remainder
and the
Proceeds—For general corpor¬
Price—Expected at $10
share.
per
Under¬
writer—Dittmar & Co., San Antonio, Tex.
•
General
March
to
Controls
16
the
increase
stockholders
the
1 /;
Co., Glendale, Calif.
voted
to
i
o
approve
plan
a
authorized
preferred stock from 60,553
It is planned to issue a portion
defray in part the purchase of the
shares to 260,553 shares.
of the
shares to
new
Controls and Instrument Division of Perfex
Corp. Under¬
writers — Last preferred stock offering was handled by
both of Los
& Durst, Inc.,
Angeles, Calif.
and
Lester,
Ryons
&
Co.,
General Telephone Co. of California
Dec.
15
sion
for
41/2%
applied to California P. U. Commis¬
to issue and sell 200,000 shares of
(par $20).
Proceeds—To re~ay
for expansion program.
Underwriters—
company
authority
preferred
stock
May be Paine, Webber, Jackson & Curtis; Stone & Web¬
ster Securities Corp.; and
Mitchum, Jones & Templeton,
Georgia Power Co.
Dec.
30
it
t0
(5/10)
announced
was
plans to issue and
sell $12,000,000 of first mortgage bonds due 1985/'-'Pro¬
ceeds—To
retire
bank
company
loans
Underwriter—To
gram.
be
and
for
construction
determined
by
pro¬
competitive
bidding.
Probable bidders: Halsey, Stuart & Co. Inc.;
Corp.; Lehman Brothers; Union Securi¬
Corp. and Equitable Securities Corp.
(jointly);
Morgan Stanley & Co.; Kuhn, Loeb & Co.; Shields & Go.
and Salomon Bros. & Hutzler (jointly); Harriman
Ripley
& Co. Inc.; Blyth & Co., Inc. and
Kidder, Peabody & Co.
(jointly). Bids—Expected to be received up to 11 a.hi. *
(EST) on May 10. Registration—Scheduled for April 13.
The First Boston
Giddings & Lewis Machine Tool Co.
in¬
Feb.
15,
the
the
stockholders
authorized
approved
proposal
a
stock
common
(par
,»
$2)
to
frpm
400,000 shares (360,000 shares outstanding) to 750,960
shares, in order to have additional shares which wotild
be available for
acquisition of any business, increased
working capital, plant expansion or exchange of shares
in other companies. Underwriter
Previous financing
handled by Hornblower & Weeks and associates.
—
Commonwealth
Edison Co.
Jan.
24, Willis Gale, Chairman, announced it should be
Fall before the company undertakes its next financing.
will
For
construction, which, it is estimated,
cost about $125,000,0000 in 1955.
Underwriters—
last equity financing were The First Boston Corp.
Glore, Forgan & Co.
March
sell
it
28
new
(to
was
cumulative
preferred stock (par $25). Underwriters—
Co., Milwaukee, Wis.; and Bell & Farrel), Inc.,
Loewi &
Madison, Wis.
Consolidated
Natural
to
17
the
738,743
each
repay
shares
for
early
on
held.
in
23
a plan for offering up
capital stock for sub¬
the basis of'one new share
offering is tentatively
Proceeds—Principally to
Underwriter—None.
authorized
Inc.
the
issuance
and
sale
in
1955
Underwriter
Tellier
—
R? " CV».
Jersey City, N. J. Registration—Expected late in March.
ir Continental
March 25
vote
it
Can Co.,
was
April 18
on
Inc.
announced
preferred stockholders will
approving creation of not to exceed an
additional
$25,000,000 of debentures or other indebtedness maturing later than one year after the date thereof.
Underwriters—Goldman, Sachs & Co. and Lehman Bro¬
thers, both of New York.
w
'
N-
,
,
.
Feb. 25
it
was
Co., New Yyik,
4
.
Paper Co.
announced stockholders will vote
increasing the debt authority to $20,000,000.
writer—A. G. Becker & Co. (Inc.),
Chicago, 111.
on
,
May 113
Under¬
Hartford Gas Co.
March
15
sale
first to
$6,000,000 convertible debenture bondi
in connection with the acquisition of Uranium Mines of
America, Inc. stock. Public offering of $2,000,000/bond»
early
writer—Eisele & King, Libaire, Stout &
handled previous financing.
and
of not to exceed
<
17, D. L. Alberty, Executive Vice-President, an¬
nounced that the company will have another stock issnaa
in the near future.
Proceeds—For expansion.
Under¬
The
June.
Uranium Mines,
stockholders
Gulf Cities Gas Corp.
Jan.
Kammermill
of
outstanding bank loans.
Consolidated
July
shares
Manufacturing Co.
3
it was reported that company may do some
financing in connection with acquisition of Gasinatpr
Mfg. Co., Cleveland, O. Underwriter—Straus, Blossef St
McDowell, Chicago, 111.
Co.
directors approved
additional
10
Gas
Given
March
;<
reported company plans, ;to issue and
residents of Wisconsin) 14,000 shares of 5%%
expected
Telegraph Co.
recommend
Co.,
21
scheduled
voted
&
it was reported company plans to issue and sell
100,000 shares of convertible preferred; stock (par
$100). Underwriters—Kidder, Peabody & Co. and White,
Weld & Co., both of New York.
;
for
Alleghany Corp.
Feb. 10 company offered 1,367,440 shares of 6% convert¬
Lynch,
Corp.
bidders:
increase
Co.
scription by stockholders
(EST) on
Registration—Scheduled for April 27.
directors
new
held.
shares
Bids—Expected to be received up to 11 a..m.
16
National
proposed offering for
March
American Telephone &
Forgan
reported stockholders will vote April 12
Corp.;'Lehman Brothers; Harriman Ripley & Co. Inc.;
Blyth & Co., Inc. and Kidder, Peabody & Co. (jointly).
Feb.
Glore,
Savannah, Ga.
March 8 it
Merrill
ties
Citizens &
Drexel & Co. (jointly); The First Boston
1
May 24.
be
if Community Telephone Co. of Wisconsin
announced company plans
sell $15,000,000
ties Corp. and
May
Chicago., 111.
and
Power
—
and
& Co. Inc.; Kidder,
Lynch, Pierce, Fenner &
(jointly); Lehman Brothers and Blyth & Co.,The*,
(jointly); Glore, Forgan & Co.; and The First Boston
common
holders will vote April 29 on
Feb.
Prospective Offerings
Dec.
Probable
Co.
&
late
$10,000,000 of first mortgage bqnds. Underr
To
»—
bank loans and
Chicago Corp.
Proceeds—For
Alabama
writers
Wagenseller
plans to issue and
sell $40,000,000 of new bonds. Proceeds—To refund it«
outstanding $37,851,000 37/s% bonds and $2,441,000 4%
bonds. Underwriter—May be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
was
of
Underwriter—■
reported company may issue and sell,
ate purposes.
Maine Power Co.
about
Uranium & Mining Corp.
July 12 (letter of notification) 300,000 shares of commoD
stock (par one cent).
Price^-$1 per share. Proceeds—
For mining operations.
Underwriter—Sheehan & Co.,
Boston, Mass.
:
was
in 1955 about
March 23 it
Probable bidders: Halsey, Stuart &
Co. Inc.; Stone & Webster Securities
Corp.; Kidder, Pea¬
body & Co. Bids—Expected to be, received on June 7.
Registration—Planned for May 6.
poses.
Wyoming Minerals Corp., Thermopolis, Wyo.
Wash.
Dec. 31 it
Power
Foundation.
Feb. 16 (letter of notification) 250,00$ shares of common
-Stock.
Florida
new
(6/7)
.
i
a
Kidder,
March 28 it was reported company plans to issue and sell
$4,000,000 of first mortgage bonds. Proceeds—For con¬
struction program.
Underwriter—To be determined by
1955.
anticipation
//
Peabody
Pierce, Fenner & Beane.
for-1
if Central Illinois Electric & Gas Co.
Sept.
Salt Lake City,
Underwriter—P. G. Christopulos & Co., same city.
penses.
•
Underwriter—Smith, Ramsay
Co., Inc., Bridgeport, Conn.
Central
in
activities.
Beane
Co.
common
l-for-8 basis.
a
on
writers:
Peabody
reported company plans to offer 22,688
was
on
interest costs.
Chesapeake & Ohio Ry.
Mining Corp.
July 21 f(letter of notification) 9,996,000 shares of
share.
holders
&
.
Uranium
World
<
it
additional shares of
working capital
and
Office—42
;•
March 7
Hydraulic
shares
company plans to offer to its
about 232,000 additional shares of common
l-for-10 basis in May or June 1955. Under¬
competitive bidding.
Managers Inc., New York, which is under the di¬
come
Bridgeport
in over-all
June.
Fund, Inc., Baltimore, Md.**
Jan. 28 filed 500,000 shares of capital stock. Price—At
market.
Proceeds—For investment.
Underwriter—In¬
-
reduction
3,000,000
company's
financing handled by Greene & Co., New York.
Florida Power Corp.
31 it was reported
stock
to'continue studies and
a
increase authorized capital stock from
to
the
stockholders
refunding. Underwriter—Feb. 16, Howard E.
Simpson, President, announced Glore, Forgan & Co.,
Halsey, Stuart & Co.'Inc. and Alex. Brbwn & Sons have
and
of
Dec.
ceeds—For
engaged
to
shares
Previous
10 company
been
de¬
was
Helicopters, Inc.
V ■;
Waters, President, announced stock¬
expansion
common
received ICC exemption from competi¬
tive bidding of up to $345,000,000 of new securities. Pro.
common
ceeds—For
1,000,000
(5/2)"
Baltimore & Ohio RR.
looking towards
stock
Doman
Lane, Space & Co., Savannah, Ga.
structure
Mining Co., Moab, Utah.
Jan. 20 (letter of notification) 500,000 shares of
authorizing about $60,000,000 of convertible
May 2 will
on
Feb. 17 Donald S. B.
stock and 35,000 shares
of $10 par preferred stock. Price—About
$11 per com¬
mon share and $10 preferred share. Underwriter—John¬
Feb.
on
stockholders
Previous offer of convertible debentures
made to stockholders without
underwriting.
be
'
Winfield
vote
announced
bentures.
holders voted
Augusta Newspapers, Inc., Augusta, Ga.
Feb.
it
was
4
:
21
2,225,000
—
33
Co.
Jan.
capital stock (par $10)
2,500,000 shares to 3,500,000 shares to provide for
offering to stockholders on the basis of one new
an
if Wilrich Petroleum, Ltd., Toronto, Canada
March 24 filed 2,000,000 shares of capital stock
of which 1,000,000 shares are to be issued in
Detroit Edison
April
authorized
from
son,
-
Francisco, Calif.
announced stockholders will vote
was
increasing the
on
-
if Williamson
(1545)
stockholders
approved the proposed issuance
$1,500,000 convertible debentures due 1.965,
preferred and common stockholders at rate of
of
$25 principal amount of debentures for each three shares
held.
Underwriter—None/Offering—Expected in Mayor
June, 1955.
r
Hartford
Special
Feb. 24 stockholders
mon
Machinery Co.
were
to
vote
to
increase
the com¬
stock
by 25,000 shares to 62,500 shares (par $26),
the additional stock probably to be offered to
stock¬
holders. Underwriter—None.
Horseshoe Bend
Feb.
and
1
sell
it
was
Uranium, Inc.
announced
150,000 shares of
that
company
common
stock.
plans
to
iss®3
Price—$2
Continued
on
-per
page
The Commercial and Financial Chronicle
(1546)
54
...
Thursday, March 31, 1955
•»
•
Continued from page
53
Proceeds—For exploration and development ex¬
share.
Securities Corp.,
penses. Underwriters—James Anthony
New York; Lawrence A. Hays Co., Rochester,
—Probably in Aprils
Telephone Co. (6/3)
it Illinois Bell
petitioned the Illinois Commerce
Commission lor authority to issue and sell 663,469 addi¬
tional shares of common stock to stockholders of record
June 3 on the basis of one new share for each six shares
March 29 the company
American Telephone
99.32% of the pres¬
outstanding stock. Price—At par ($100 per share).
held; rights to expire on June 30.
& Telegraph Co., the parent, owns
ently
additions to property.
Proceeds—For improvements and
Underwriter—None.
Telephone Co.
Illinois Central
Jan. 26 it was reported company
Price—At
($50.
par
plans to sell in Illinois
per
Underwriter—Central
share).
Republic Co. (Inc.), Chicago, 111.
York
Feb. 21 it was reported that offering of 125,000 shares of
common
stock is soon expected.
Proceeds To selling
stockholders. Office—575 Madison Ave., New York 22,
N. Y. Underwriters—Milton D. Blauner & Co.; Barucn
Brothers & Co.; and Hallowell, Sulzberger & Co.
Materials Corp., New
Raw
Industrial
Service Co.
Feb. 28 directors authorized officers to sell 270,220 addi¬
i.
Public
Iowa
stock (par $5) to common stock¬
rata basis. Price—To be named later.
tional shares of common
holders on
Proceeds
pro
a
construction
For
—
program.
Underwriter
—
Offering—No definite date has been set.
None.
for
and
Jersey Central Power & Light Co.
it was reported company plans to
Co. Inc.
Jan. 31 it
Underwriters — For debentures,
Halsey, Stuart & Co. Inc. and Van Alstyne, Noel & Co.;
for stock, Van Alstyne, Noel & Co.
Power & Light Co.
Feb. 21 it was reported company
working capital.
Feb.
4
announced that company plans
was
first
some
bonds
mortgage
due
this
1985.
by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; White, Weld &
Co.; Blair & Co. Incorporated; The First Boston Corp.;
Equitable Securities Corp. and Union Securities Corp.
(jointly); Kuhn, Loeb & Co. and A. C. Allyn & Co. Inc.
(jointly); Kidder, Peabody & Co. and Stone & Webster
Securities Corp. (jointly); and Lehman Brothers.
New York,
Chicago & St. Louis RR.
expected
are
be
to
received
by
(5/10)
the
company
on
May 10 for the purchase from it of $4,080,000 equipment
trust certificates.
Probable bidders: Halsey, Stuart &
Co. Inc.; Salomon Bros. & Hutzler; Kidder, Peabody &
Co.; Blair & Co. Incorporated.
sell
it
29
announced
was
about $21,500,000
of securities has
construction
that
the
of securities
been determined.
not
year.
plans to
The type
Proceeds
•—
For
program.
Telephone Co.
Keith S. McHugh, President, announced that
the company will have to raise more than $100,000,000
of new capital money to aid in carrying out its expan¬
Jan.
17,
and improvement program
which will cost ap¬
proximately $200,000,000. Underwriter—For and bonds,
to
be
determined
by competitive bidding.
Probable
bidders: Morgan Stanley & Co.; Halsey, Stuart & Co. Inc.
North
Dec.
17
stock
To
Penn
it
will
soon
later.
named
420,000
Proceeds—For construction program.
Underwriter—To be determined by competitive bidding.
Probable bidders: The First Boston Corp.; Merrill Lynch,
Pierce, Fenner & Beane and White, Weld & Co. (joint¬
ly); Glore, Forgan & Co. Offering — Expected before
July 1.
Merrill
Indiana
shares
of
common
be offered to public.
Proceeds—To
The Post
Co., publisher of The Boston Post.
man, Dillon & Co., New York.
Northern
Keystone Wholesale Hardware Co., Atlanta, Ga.
it was stated that the company plans at a later
Jan. 27
date
additional shares for sale
offer
to
nationally.
An
Public
Price—
Publishing
Underwriter—East¬
presently
oifering of 16,666 shares of common stock is
being made to residents of Georgia only at $3 per share.
Office—517 Stephens St., S.W., Atlanta, Ga.
March
it
22
announced
was
ICC had dropped its com¬
bidding requirement on the proposed sale of
$1,700,000 of new 23-year first mortgage collateral bonds
due 1978. Proceeds—To redeem approximately $1,400,000
of 5% first mortgage divisional bonds which were sold
♦in 1952 through Blair & Co. Incorporated, New York, and
petitive
'Coffin & Burr, Inc., Boston, Mass.
Maine Central
Feb.
not
up
collater-al
and
bonds
trust
due
1978.
bidders
for new bonds may include Halsey,
Kidder, Peabody & Co.; W. C. Langley
& Co.; Coffin & Burr, Inc.; The First Boston Corp.;
Merrill Lynch, Pierce, Fenner & Beane; Blyth & Co.,
Inc.; Glore, Forgan & Co.
Probable
Stuart & Co. Inc.;
Majestic Auto Club, Inc.
Aug. 25 it was announced company plans to offer 500,000 shares (par five cents) to the motorist and general
public shortly after completion of the current offering
of 100,000 shares to service station owners and operatori.
Office—Room 717, 141 Broadway, New York 6, N. Y.
Pacific
Missouri
Bids
are
RR.
Probable
equipment
bidders:
trust
certificates
Halsey, Stuart &
1956-1970.
due
Co.
Inc.; Salomon
Hutzler;;Blair & Co. Incorporated; Kidder, Pea¬
body & Co.
Bros. &
Missouri
Feb.
14 it
Public
Service
reported company stockholders will vote
March
12 on increasing common stock from
530,000
shares to 2,000,000 shares to provide for a 3-for-l splitwas
up, and additional stock for future issuance.
Under¬
writer—May be Kidder, Peabody & Co., New York.
Murphy
Feb. 8 it
vote
on
(G. C.)
a
proposal
indebtedness
For
Co., McKeesport,
announced
was
from
expansion
Pa.
stockholders will
on
to increase the authorized
$3,000,000 to $20,000,000.
program.
Underwriter
—
April 12
limit
of
Proceeds—
Merrill Lynch,
Pierce, Fenner & Beane, New York, handled preferred
stock financing in 1942.
it National Co., Inc., Maiden, Mass.
March
29
announced
(Minn.)
that
new
tive
stockholders
increased
authorized
common
stock (par $1) from 300,000 shares
(260,100 shares out¬
standing) to 400,000 shares. Joseph H. Quick, President,
said it is contemplated that some
financing will be ar¬
ranged during 1955 to provide additional capital in
connection with the current expansion
program.
Under¬
writer—Probably A. C. Allyn & Co. Inc., New York.
Service
Probable
Co.
bidders:
Underwriter
of
—
&
Drexel
Co.,
Oklahoma
reported that company plans to issue and
sell 100,000 shares of new preferred stock (par
$100).
Underwriter—To be determined by competitive bidding.
Harriman
Ripley & Co. Inc. and
(jointly); Smith, Barney &
Co.; Kuhn, Loeb & Co.; Glore. Forgan & Co. OfferingExpected in May or June, 1955.
Central
sell
Republic
18 it
Co.
Inc.
announced company
was
75,000
shares
of
5%
plans to issue and
convertible
preferred stock
through S. D. Fuller & Co., New York. The
proceeds are to be used for expansion and work¬
ing capital. Offering—Expected some time in May.
(par $10)
net
Radio
Feb.
Receptor Co., Inc.
it
28
that a public offering is soon
250,000 shares of common stock, of
100,000 shares will be sold for account of com¬
expected
which
was
of
reported
about
and 150,000 shares for selling stockholders.
pany
Under¬
writer—Bache & Co., New York.
it Scholz Homes, Inc., Toledo, Ohio
was reported company plans early registra¬
tion of 150,000 shares of common stock. Price—Expected
at
$5 per share.
and Union Securities Corp.
Underwriter—Straus, Blosser
Mc¬
Dowell, Chicago, 111.
(joint¬
its
it
announced
was
preferred
basis,
and
has
and
U.
P.
common
sought
Commission
to
competitive bidding.
company
stockholders
plans
permission
from
the
exempt
Proceeds
on
to
a
offer
the
rata
pro
California
proposed
To
—
issue
promissory
retire
from
notes and
for construction program. Underwriters—The
First Boston Corp. and Dean Witter & Co. underwrote
the last offering of common stock.
j,
Southern
Feb. 28
Alberta,
Can.
project. Underwriter—Eastman, Dillon & Co., New York.
Northwest
California
of
with
emption
from
last sale
of
Gas Co.
reported company plans to issue and sell
first mortgage bonds.
Application has
was
filed
been
California
P.
U.
Commission
for
ex¬
competitive
bonds
were
bidding. Bids received on
from Halsey, Stuart & Co. Inc.;
Blyth & Co., Inc.; White, Weld & Co. and Union Secu¬
rities Corp. (jointly); Lehman Brothers.
Southern
Dec.
it
30
sell
March 4 company plans to issue and sell publicly deben¬
tures and common stock to finance its proposed chemical
it
$40,000,000
Co.
was
(11/9)
announced
company plans to Issue and
the public 500,000 additional shares of common
(par $5). Proceeds—To repay bank loans and for
stock
(jointly); Glore, Forgan & Co.
Ltd.,
29
approximately $40,000,000 of convertible debentures to
& Co.
Nitro-Chemicals,
Business—Manufactures pre-fabricated
and pre-cut homes.
ly); Smith, Barney & Co.; Lehman Brothers and Riter
•
plans to
company
was
require¬
Inc.; Blyth & Co., Inc. and The First Boston Corp. (joint¬
ly); Merrill Lynch, Pierce, Fenner & Beane, Kidder,
Peabody & Co. and White, Weld & Co. (jointly); Equit¬
able Securities Corp.
the
.
capital
Underwriter—To be determined by competi¬
bidding. Probable bidders: Halsey, Stuart & Co.
to
investment
in additional
Underwriter—To
be
stock of
determined
subsidiary companies.
by competitive bid¬
ding. Probable bidders: The First Boston Corp., Ladenburg, Thalman & Co., Carl M. Loeb, Rhoades & Co. and
Wertheim & Co.
(jointly); Blyth & Co., Inc., Bear,
Plastics, Inc., St. PauJU Minn. (4/19)
announced that corporation proposes
to offer 24,000 shares of common stock.
Price—Expected
to be $12.50 per share. Proceeds—To finance fibre
glass
division producing a complete line of fibre glass boats
Stearns
and
Not expected until Oct. 12.
March
22
it
was
cruisers.
Underwriters—Irving J. Rice & Co., St.
Paul, Minn., and M. H. Bishop & Co., Minneapolis, Minn.
Ohio
Feb.
24
Edison
it
Co.
writer—To
(5/17)
reported
was
of $30,000,000 of first
be
company
plans issue and sale
mortgage bonds due 1985.
Under¬
determined
bidders:
tration—Scheduled for April 26.
Oklahoma
was
Gas
&
Electric
Witter
Southwestern Gas &
it
17
and
&
Co.
Electric Co.
sell
was
reported
Is planning to issue
$6,000,000 of cumulative preferred stock (par
$100). Proceeds—To prepay bank loans and for construc¬
company
tion program. Underwriters—To be determined by com¬
petitive bididng. Probable bidders: White, Weld & Co.
and Kidder, Peabody & Co. (jointly); Lehman
Brothers;
Merrill
Lynch,
Pierce, Fenner & Beane and Union
(jointly); W. C. Langley & Co.; Harri¬
Ripley & Co. Inc. Offering—Expected in April or
Securities Corp.
May, 1955.
Co.
reported company plans to issue and sell
year.
Under¬
writer—To be determined by
competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co.
Inc., Equitable Se¬
curities Corp.; Merrill
Lynch, Pierce, Fenner & Beane
While, Weld.& Co. (jointly); Lehman Brothers and
Blyth & Co
Inc. (jointly); The First Boston Corp.;
Kuhn
Lo< b <V Co.; Harriman
Ripley & Co. Inc. and
and
Securities. Corp.
Co. and Dean
(jointly); Union
(jointly);
Co.; Kidder, Pea¬
body & Co., and Merrill Lynch, Pierce, Fenner & Beane.
Bids—Tentatively scheduled for Nov. 9. Registration—
man
$15,000,000 of first mortgage bonds later this
Union
&
Securities Corp. and Equitable Securities Corp.
Lehman Brothers; Morgan
Stanley &
Jan.
by competitive bidding.
Halsey, Stuart & Co. Inc.; Morgan
Stanley & Co.; Glore, Forgan & Co., White, Weld & Co.
and Union Securities Corp.
(jointly); The First Boston
Corp. Bids—Expected to be received on May 17. Regis¬
Feb. 23 it
Co.
Public
Nov. 11 it
will
approximate $31,000,000.
Present
contemplate these funds will be obtained tem¬
porarily from short-term bank loans to be repaid from
proceeds of the sale of additional bonds late in 1955 or
Probable
expected to be received in April for an issue of
$3,765,000
was
1.955
Northwest
the idea of refunding the $17,000,000 5Y8%
mortgage
it
plans
RR.
14, E. Spencer Miller, President, said company has
given
first
29
early 1956.
RR.
Maine Central
it Northern States Power Co.
for
that
announced
was
mature on May 1, 1955.
Philadelphia, Pa.
March
Co.
Lynch, Pierce, Fenner & Beane.
March
it
it Southern California Edison Co.
Service
12, D. H. Mitchell, President, announced that the
company plans
to raise approximately $12,000,000 of
new
money (which may be done through sale of pre¬
ferred and/or common stock).
Underwriters—Probably
Central Republic Co. (Inc.), Blyth & Co., Inc.; and
ments
11
refinance the outstanding $10,000,000 Market Street Ele¬
vated Passenger Ry. Co. first mortgage 4% bonds which
March 28 it
Co.
announced
was
(par $5)
be
Gas
Underwriter—Paul C. Kimball &
Offering—Expected in April.
Philadelphia Transportation Co.
March
New York
plans to sell $5,000,000
preferred stock.
ceeds—For expansion.
March
company
this
was
Pyramid Electric Co., Jersey City, N. J.
it New York State Electric & Gas Corp.
March
Finance Corp., Denver, Colo.
reported company plans to issue and sell
$500,000 of 6% convertible preferred stock. Pro¬
about
year
Under¬
writer—To be determined
Bids
People's
Co., Chicago, 111.
Inc.
Service
Jan.
of
'
it
issue
to
Public
Orleans
New
sion
_
issue and sell
$12,000,000 first mortgage bonds. Proceeds — To repay
bank loans and for new construction. Underwriter—To
be determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Blair & Co. Incorporated; Leh¬
man Brothers; Union Securities 0Corp., Salomon Bros. &
Hutzler and Merrill Lynch, Pierce, Fenner & Beane
(jointly); White, Weld & Co.; Kidder, Peabody & Co.
Offering—Expected before the end of June.
Feb. 21
Jersey Central
by competitive bidding. Probable bidders:
Kuhn, Loeb & Co.; W. C. Langley & Co. and Glore, For¬
gan & Co. (jointly); Kidder, Peabody & Co.; The First
Boston Corp.; Smith, Barney & Co.; Harriman Ripley &
will carry an'annual interest. rate v of- 4%%-*-or 4%%.
Proceeds—To retire bank loans, for expansion program
of.51/2% cumulative preferred stock
only, 15,000 shares
corporation is negotiating
the sale of 250,000 shares of common stock (par $1)
also a second series of $7,000,000 debentures which
and
N. Y.;,s
Co., Salt Lake City, Utah. Offering;
and Ned J. Bowman
determined
National Container Corp.
23 it was announced
March
(jointly); Smith, Barney & Co.
Penrsylva-iitiL electric Co.
15 it was it;
rted company plans to issue and sell
later this year $»b.:700,000 of first
mortgage bonds. Pro¬
ceeds—To repav tank loans and for new
construction.
Underwriter—To fca determined
Feb.
by competitive bidding,
probable bidders. Halsey, Stuart & Co. Inc.; The First
Boston Corp ; Kuhn, Loeb &
Co.; Kidder, Peabody &
Co.; Equitable Securities Corp.; Harriman Ripley & Co..
Texas Eastern Transmission
Corp.
Jan.
12, George T. Naff, President, referred to the pos¬
sibility of some $85,000,000 in new financing when and
if the company's current application for the reconver¬
sion of the Little Big Inch pipeline and the construction
of the new natural gas facilities is launched.
He indi¬
that
cated
sumed
it
was
possible
that $40,000,000
of that
as¬
$85,000,000
new financing might be in the form of
first mortgage bonds, (to be placed privately), and
that based upon the assumptions that he was making he
believed that the remainder of the financing would be
new
accomplished by
ferred
man
the
issuance
stocks
of
debentures
(he did not assume the sale of
stock). Plans for the possible issuance of
rities.
are
March
4.
and
pre¬
any
corn-
new
secu¬
not at all definite as
yet, it was announced on
Underwriter—Dillon, Read & Co., Inc., New
York.
Inc.
Pennsylvania
Feb. 21 it
was
Texas
Electric
Co.
reported company proposes issuance and
sale of $7,5 l-O.POl) of preferred stock later
this year. Pro¬
ceeds— or construction
program.
Underwriter—To be
March
21
Instruments, Inc.
J.
Erik
holders will vote
an
Jonsson, President, announced stock¬
April 20
on
authorizing the creation of
issue of 300,000 shares of cumulative preferred stock
Number 5416
181
Volume
.
.
.
to be known as convertible
stock to common stockholders. Proceeds—For
and
Underwriter—Morgan Stanley &
capital.
working
expansion
" ■>.
Co., New York.
N.
24,
of company and of United Gas Pipe
program
Corp.
Transamerica
>
'
-
,
"■}
J
'
Radio Corp.
Trav-Ler
Feb.
'
'
^
early registration
of $1,500,000 12-year convertible debentures with stock
purchase warrants (each $1,000 debenture to be accom¬
panied by 100 warrants). Underwriter—Straus, Blogser
& McDowell, Chicago, 111. Registration — Expected in
Feb. 21 it
near
reported company plans
was
Underwriter
tion.
March
it
14
vote
Vanadium
approving
on
stockholders will
United
new
a
About 150,000 shares are pres¬
Price—$9 per share. Underwriter—
subscription privilege).
Corp.;
White,
None.
has
than
market.
ready
added
of
flavor
Probable .bidders:
re¬
an
better
a
It had the
off-the-track
for public offering
debentures/-Segan trading at
four points and
of
premium
later lifted the e^
The lag
in the new capital mar¬
quite pronounced
continues
there
point
this
to
up
has
real complaint from
not been any
distributors of
and
underwriters
securities.
e
to better than
recent
soi
utility
offerings
bidding route;
via
made
had
lave
a
bit
the rough side.
on
capital pools with funds
investment, such as
insurance companies, remain
Large
available for
the
pretty much aloof. And judging
by the comment of market ob¬
servers
of
long experience the
line
of demarcation
between a
deal
successful
and
laggard is
a
pretty clearly drawn.
Salisbury is now with K E.
people evidently find considerable
attraction in debt issues carrying
it
which
for
privilege
conversion
provides
on
the
the
subject to
change, will find inquiry brisk.
present indications are
Forward
companies
insurance
ap¬
&
Remmele-Johannes
Co.,
1126
negotiate
Jthe way of private
parently are still able to
in
sufficient
needs.
take
to
business
And
substantial amounts
in the mortgage
field.
Joins First Cleveland
aside
stand
to
fire
on
in
point
Negotiated
vs.
Bids
understand why the
favors
negotiated business
Street
over
basis.
that
One
taken
in
on
need look
50
cents
volume
of
will
another
a
to
the
chance
sizable
And
there
$20,090,000
Pacific
is
of
the Common
on
June
15,
of record
195 5
the
at
A
The Goodyear Tire & Rubber Co.
By Arden E. Firestone, Secretary
Akron, Ohio, March 28, 1955
to
SPECIAL GENERAL
NOTICE
The Annual
the
prospect
of
debentures
for
Pipeline
on
74th consecutive
be
Company,
this
a
bidding
coming
no
further
through negotiations.
one,
too,
of
year
dividends
By-laws of the
held
Thursday,
on
The
Board
morning, at the Head Office
The
Diamond Match Com¬
the
ant
to
1155 Metcalfe Street,
call
the
Directors,
of
Board
the
of
Special General Meet¬
a
of
of Directors
21st Floor, Sun
Company,
of the Annual Meeting
Dividend No.
of
$.625
per
193
par
value
share
Common
payable
1955, to stockholders
the close of business
at
April 1, 1955.
H. R. Fardwell, Treasurer
New
1955)
The Diamond Match Company
Meeting of the Share¬
accordance with the
of
Checks will be mailed.
Co.
March
pany on
clared
of
a
March 24, 1955 de¬
quarterly dividend
66% (1
per
share
the
on
Common Stock.
ing of the Shareholders of Aluminium
Stock has been declared,
of record
on
Assistant Secretary
holders of Aluminium Limited will, in
York, March 23, 1955.
purpose
of the Share¬
same
place, for
of considering and, if
thought fit, approving
of the Company from twelve to
fourteen.
record
at
Only shareholders of
the
March 30th,
receive
of
business
on
1955 will be entitled to
notice
these meetings
ment
close
of
and
and at
the
At
to
any
vote
same
share
on
quar¬
per
the $1.50 Cumula¬
tive Preferred Stock.
Both
dividends
are
payable
May 2 to stockholders of rec¬
ord
April 7, 1955.
at
adjourn¬
WARD W.
\
March 18 th, 1955
a
terly dividend of 37%
thereof.
Montreal,
meeting the
Board also declared
By-law No.
22 to increase the number of Direc¬
tors
April 29,
holders of record of said stock
the close of business
Record Date
the
no
de¬
April 1, 1955,
MEETING
holders and at the
the
has been
ANNUM. MEETING
COMPANY
dividend
on
&
ELEVATOR
A
Company
April 28th, 1955, at 11:00 o'clock
OTIS
on
this
ALUMINIUM LIMITED
Montreal, Quebec, Canada. Pursu¬
Common
of
(31.25^)
the Preferred Stock
on
W. L. Farrior
in the
over
share
(Directors Meeting Mar. 23,
MEETING NOTICE
(Special to The Financial Chronicle)
investors
look
per
at
RU&&EH
Baker, Simonds Adds
General
and one-quarter cents
23, 1955.
—
Exchange.
dividend of thirty-
quarterly
one
to
GREATEST NAME
(Special to The Financial Chronicle)
Stock
Preferred Stock
clared, payable
THE
Joins F. L. Putnam
Mass.
Dividend on
to
close
of business May 16, 1955.
IN
it
offering. Tennes¬
Northwest
along,
today de¬
now
BOSTON,
Roofing Company
savannah.ceorgia
Limited will be held upon conclusion
debentures,
have
NOTICE
share
per
payable
Ohio—Richard P.
associated with
Corporation,
United Savings Building.
is
productive side.
addition
NOTICES
DIVIDEND
clared the following dividend:
First Cleveland
DIVIDEND
some
It's easy to
York, may be included among the bidders.
The Board of Directors
TOLEDO,
Brannan
The
promises to be a bit more on the
In
White, Weld & Co., New
of Colorado Interstate Gas Co.
Life Building,
new
of Sinclair's holdingi
New York, underwrote recent sale
(Special to The Financial Chronicle)
Calendar
further correction see Gas Transmission Co., also by
of
prices
and
yields in the negotiation, has $25,000,000 of new
seasoned market. At any rate they
20-year debentures on schedule
are not yet in a receptive mood.
for Wednesday.
pending
1955, if it has not been able to dispose of these holdingi
before that date. Underwriter—Union Securities Corp.,
stockholders
next
Dynamics
contingent, it appears, re¬
inclined
mains
their
meanwhile tfiey con¬
tinue to place
This
of
care
(4/15)
shares of Westpan stock about April 15,
bids for 384,861
DIVIDEND
Stock,
week's potential in
issues will not set the world
While
plans
financing
Sinclair Oil Corp. will ask for
Iron
(Special to The Financial Chronicle)
DAYTON, Ohio—John W. Bur¬
ner
has
become affiliated
with
reverse.
Big
definite
no
SOUTHERN STATES
undertakings which issuer's stock.
DETROIT, Mich. — Hugh C.
usually are priced to fit prevail¬
This
offering being done by Jackson has joined the staff of
ing
conditions move out quite negotiation with underwriters is Baker,
Simonds
&
Co., Buhl
readily. But in the case of securi¬ due out next midweek and unless Building, members of the Detroit
through competitive
bidding the situation is quite the
but
it was reported
11
With Remmele Johannes
Negotiated
ties obtained
additional
goodAear
Building.
curities
Mildred G.
Douglas has joined the staff of
F. L. Putnam & Company, Inc.,
77 Franklin
Street," members of
Undoubtedly this is due in part the Boston Stock .Exchange. Miss
to the rather spectacular behavior
Douglas
was
previously
with
of the stock in recent weeks. But
Vance, Sanders & Co.
pared for market" by General Dy¬
namics Corp. is Stirring up plenty
of investor interest.
^call"
4-for-l split
C.
Henkle
Investment Company, Federal Se¬
the
going. Kansas G$s & Electric, At¬
lantic
City Ele|tric and Texas
a
a
Neb. —Randall
LINCOLN,
hard-
relative
the
aforesaid,
as
DIVIDEND NOTICE
public
entirely satis¬ Electric
ServiceJfepisodes are just
dearth of a few of cases in
point.
business yet with institutional in¬
vestors
in
their present mood,
General dynamics
reticent
to
say
the
least, the
From all indications the forth¬
struggle to place new debt issues
coming $40,000,600 issue of con¬
bought at competitive sale is still vertible
debentures
being
pre¬
They may not be
fied with
Dec.
Halsey, Stuart & Co.
Oakwood Avenue.
six points.
Meantime
approving
on
Westpan Hydrocarbon Co.
With E. E. Henkle
Priced at 100
the
(6/7)
plans to issue and sell
Salomon Bros. & Hutzler;
Weld & Co. Bids—Expected June 7.
maturity being^iptie in 20 years.
a
13
(Special to The Financial Chronicle)
found
which
offered
Kuhn, Loeb & Co.;
cently sold an issue of $60,000,000
of
subordinated
convertible de¬
bentures
offering to stockholders.' Stock¬
an
1,580,000 new shares, part of which are expected to be
Securities Corp.; Stone & Webster Securitiei
happened recently
Co. of California
Union Oil
through
of the company's stock and the issuance of an
first mortgage bonds in the near fu¬
—
To be determined by*competi¬
of
market. ';'f*
in the
plans to issue and sell
Underwriter
Inc.; Union
Co.
was^nnounced that consideration is being
have been formulated.
bidding.
tive
stock
mon
stock.
19 it was reported company
ture..
Union Telegraph
it
15
an
given to the issuance of some additional shares of com-1
Price—Expected to be
share. Underwriter—Van Alstyne, Noel & Co.,
$25,000,000
than what
announced stockholders will vote
was
holders will vote April
Virgina Electric & Power Co.
Feb.
directors authorized an offering to common
stockholders of additional common stock at the rate oi
one new share for each five shares held (with an over¬
;
Proceeds—To
New York.
Dye & Chemical Corp.
ently outstanding.
it
1
approving
on
Western
Queen Uranium Co.
it was reported company
$2.50 per
issue of 500,000 shares of
8
new
(EST) on April 5 by
directors on Jan. 14, 1955.
720,000 shares of common
April
on
standing), and for working capital. Underwriter-r=Harriman Ripley & Co., Inc., New York.
Sept.
28
entitled to receive fractional shares.
stockholders
preference stock (par $100). Proceeds—To redeem pres¬
ent 5% cumulative preferred stock (233,500 share&3lut-
but
Washington Steel Co., Washington, Pa.
-
declared by the
Feb. 21
announced
was
,
Inc.; The First Boston
Corp.; Equitable Securities Corp.; Union Securities Corp.
Offering—Expected before July 1.
& Co.
United Aircraft Corp.
ket
able bidders: Halsey, Stuart & Co.
March
(jointly); White, Weld & Co. and Shields
(jointly).
& Co.
26
sell about
company
purchase of 4,230 shares of capital stock. These constitute
the
aggregate of all fractional shares which would
otherwise have resulted from a 20% stock dividend
Probable bidders: Halsey, Stuart & Co. Inc.;
Blyth & Co., Inc. and Union Securities Corp. (jointly);
The First Boston Corp.; Lehman Brothers and Bear,
bidding.
Stearns
Co.
plans to issue and
$8,000,000 refunding mortgage bonds. Under¬
was
writer—To be determined by competitive bidding. Prob-
Guaranty Co. (4/5)
to noon
will be received up
Fidelity
the
To be determined by competitive
—
Light
Gas
announced
Kidder,
April
issue of 30,000 shares of cumulative
convertible preferred stock (par $50).
Proceeds—For
expansion program and working capital. Underwriter—
Probably Singer, Deane & Scribner. Pittsburgh, Pa.
Bids
reported company expects to sell
was
it
and to
1956 to
Halsey,
Baltimore "National Bank & Trust • Co.,
Charles and Lexington Sts., Baltimore 3, Md., for the
^
about
$30,000,000 30-year first mortgage bonds late in 1955.
Proceeds—To repay bank loans and for new construc¬
it
24
26
March
^ United States Fidelity &
Jan.
Feb.
(jointly).
Sachs & Co.
on
* Washington
be
future.
Union Electric Co. of Missouri
<
stated that com¬
McGowen, President,
doing some debt financing, with this
year's total financing program reaching about $50,000,000 (including about $35,000,000 to $40,000,000 of com¬
mon
stock).
Underwriter—To be determined by com¬
petitive bidding. Probable bidders: Halsey, Stuart &
Co. Inc.; The First Boston Corp.; Morgan Stanley &
Co.; White, Weld & Co. and Equitable Securities Corp.
(jointly); Harfiman Ripley & Co. Inc. and Goldman,
might
(4/5)
received
certificates, series F, to be dated May 1, 1955,
mature in 15 annual installments from May 1,
May 1, 1970, both inclusive. Probable bidders:
Stuart & Co. Inc.; Salomon Bros. & Hutzler;
Peabody & Co.; Blair & Co. Incorporated.
Line Co.,
Corp.
C.
N.
24,
pany
be
55
by the company up to noon
April 5, at 44 Wall Street, New York 5, N. Y.,
the purchase from it of $1,530,000 equipment trust
for
Underwriter—None.
Gas
United
RR.
will
(EST)
Belgrano,
N.
F.
25
subsidiary.
a
Chairman and President, an¬
nounced that company plans to offer publicly 1,346,800
shares of capital stock through an underwriting group.
Offering—Planned for early in May.
Underwriters—
Blyth & Co., Inc., and Dean Witter Co.
Feb.
Bids
C. McGowen, President, announced that
corporation plans to raise $35,000,000 to $40,000,000 in
the first half of 1955 through the sale of additional com¬
mon stock to stockholders.
Proceeds—For construction
Feb.
preferred
shares
Wabash
United Gas Corp.
planned to publicly offer about
(par $25), of which it is
160,000
(1547)
Chronicle
The Commercial and Financial
JAMES A. DULLEA
Secretary
•
DE
GRQQT
Secretary
1
MATCHES-PULP PRODUCTS-LUMBER
BUILDING SUPPLIES—W000ENWARE
56
The Commercial and Financial Chronicle
(1546)
piece
BUSINESS BUZZ
Thursday, March 31, 1953
...
of
legislation
Finally,
pretty
Washington.
^
^
BehindInterpretations
trom the Nation*
'
J
^
;
the
that
the
chances
that IF any
are
good
re¬
ciprocal trade bill is passed by
the Senate, it will be amended
drastically. And when it goes
to
» ■
11/lMf
JljL
Capital.
gJ
y|
>
President wanted.
•
t
*
X IX14/
the
House, the amendments "
for Speaker Rayburn
will stay,
will
this
not
time
hold
his
finger in the dike.
(This column is intended to
WASHINGTON, D. C. — You
write off the Fulbright in¬
can
quiry
nancial
going
There isn't
community.
to
be
legislation
any
arising
of these
quence
/1
for
kind
.any
interesting if tense
the nation's fi¬
as an
experience
as
three
of
conse¬
a
weeks
is
It
natural
than
two
which
the
recollect
to
fcee-wheeling
inquiry
decades
of more
the one
prelude to
regulatory
legisla¬
served
"extensive
ago,
a
as
including the SEC laws.
of that earlier in¬
quiry, of course, was to cut the
financial community off from
tion,
The
purpose
the
public opinion
enacting regula¬
of
support
the
so
of
task
legislation
would
and the politicos
tory
soap,
discredit
froth
be
a
could
business op¬
the
position to overall radical pro¬
posals and claim credit for sav¬
ing the world, so to speak.
Fulbright
William
Senator J.
ating
Cance
backed
not
was
as
Demo¬
two
and
that
the
Senator
Mr. Fulbright,
Jionestly
necessary
the
In
two
a
the
bombing
aircraft
or
operate
pable
level
of
the
full
Ins
(a)
pose
tion
II
many
United
evils to
no
the
that
ex¬
correc¬
co
the
with
be satisfied
has been
beneficial
a
educating
of
i=iense
time he
are
is said
enterprise
to
has
been
and
could
Russian
Fulbright
^emmimity
early
trotting
by
witness,
one
out
as
of
the
brightest and most vocal of the
.academic
European Union
possibly
of
stop
Union
will
her
radicals
have
require
tion
of
their
bear
in
order
given
four
point.
years
Reds
thor¬
who
Reds
fry leading authorities including
win
to
This
at
to
any
against those
This
would
For
while
becomes
each
Senator
Fulbright
with
"liberal"
more
passing
who will
the
judgment.
good
year,
he is
a
man
listen thoughtfully
to
in
abso¬
go
the
prices
into
of
should
and
decline,
then
a
genuinely hostile Congressional
investigation with possible
damaging legislation could be
expected: This would be as nat¬
ural
to
ifchat in
expect
the
as
to
anticipate
wilds of the
North,
if
a
sleigh
horse
fell
there
would be timber wolves around
to
attack
could
the
rise to
one
had
it,
animal
before
it
its feet.
in
the
of
is
because
this
ment
Reds
West
of
strategy
kind
that
and
now
the
scare
use
another
has
deprive
It
best"
of
leaders
perhaps
This
setting
is
up
borrow
shortly
and
to come, the White House is stili?
operating on the working prin¬
ciple that "papa," meaning the
White House, "knows best," or
that Congressmen are not to be
outside
spend
Whether
highway
hardening against
this, Corporation
the
outside
debt
the
similar
the
the
most
had
dis¬
M.7
Despite agitation for boosting
manpower goals, those
set bjr
the
Eisenhower
Administration
are
expected to stand pat, bar¬
ring a much steeper involve-'
merit in defending Quemoy and
done
and
Matsa than
is
now
Fit is reported
m
plugging for
anticipated,
that the Army
a
large boost ia
taxes
service
which
the
shall
Highway
Senator
Lopez—Columbia
York
Tax
minor
appointment for
a
individual
refused
with
Eisenhower
to
a
quali¬
because
go
on
Program
Growth
Case
noted
Committee, to which
N.
Y.—
for
Economic
Manufacturers,,
Street, New York
$1.00
(10%
or
2
East
17,
more;
quest for over
Y
—
for
prices
100).
48th.
N.
discount
10*
on
re¬
_
—J.
Henry Landman—reprinted
from
-
March
"Taxes"
House,
1955
Inc.,
of
issue
Commerce
—
Clearing;
Chicago
1,
(paper).
111.
.
..
this
along
one
TRADING MARKETS
Engineering
W. L. Maxson Co.
Carl Marks
FOBEIGN
SECURITIES
50 BROAD STREET
Cor¬
TEL:
HANOVER 2-0050
that
the bill is
University
27,
National Co.
go
the Public Roads
Intro¬
Robert
National Association.'
—
of
Morgan
poration's bonds.
under the law
by
Seneca Falls Machine Co.
drafted
•
&
i
Co. Inc.
LERNER & CO.
SPECIALISTS
NEW YORK 4, N. Y.
Investment
Securities
q
TELETYPE NY 1-971
10 Post Office
Square, Boston 9, Mass.
Telephone
:•
\
Teletype
HUbbard 2-1990
-
{
in
successful
of
how
the
White
House loves this
technique. The
to
with
Notes
and
New
Mediter-
the
Taxability of Fringe Benefits, The
(R., So.
Dak.) brought out the latest il¬
highway "bill
in
Riverside Cement B
by the White House staff, pur¬
ports to say that "there is here¬
by appropriated," etc., certain
j
Illustrative Doc¬
translated
wants done.
papa
Mary¬
$6.75.
any
Senator Francis Case
gasoline
uments,
ductions
notwith¬
limit
Mr.
of
gentlemen of Capitol Hill to do
proposed
World:
copies
lustration
Manpower Goals Will Stay Pu*
Trade
ranean
piloted
refused the gift of
constituent
of
1953—John L. Johnsoiii
Medieval
the
Century.
was
fied
University
—University of Kentucky, Lex¬
ington, Ky. (paper).
legislation
individual,
heroic
Bu¬
Kentucky Residents by
County:
Republican
work,
the
of
11954
20th
—I
Economic
and
own
consulted until it is time for the
what
Income of
Press,
Chairman
the
Business
Research,
*
in
of
philosophy
the
Committee
standing
budget.
within
his
to
Congress will double
spending
of
who
Both
sentiment
--
one
far-reaching
Democratic
Y.
land, College Park, Md. (paper)..
proposed by the President than
any
N.
16,
Potentials
Business
reau
Sore
to
tinguished
Senate.
and
Gets
knows
more
the
high¬
going
Hum¬
believed
"papa
*
York
•
Presi¬
illustration
second
chance
Eisenhower is having with
some more
House
similar
in
of
on
relates
of
formidable
-
for
the
S.
appearing
now
to
program
They
Admin¬
heart
desire
scheme
A
New
Federal
in
itself
—
(cloth), $3.00.
the
that the
Administration's
extra
budg¬
etary gimmick won't have a.
in
objective
is
Street,
Secretary made as convincing a
show as a chippy would try¬
ing to sing in a church choir.
con¬
Greer
Estimating Maryland Government,
spending
motion.
Chairman Byrd.
Bill Is Losing
the
Notwithstanding the troubles
Mr.
the
its most
to
so
listened
such
far
British.
The
Paul
—
Harper & Brothers, 49 East 33rcft
budget, Mr.
phrey would not have approved
the
had
out-smarted
delivered
bill
enemy,
agree¬
has
Achievement
of
reduce
ardent
a
Mari-
M.
Management
Co-operatives:
budget
Eisenhower to get a
White
4-power conference.
Congress and
so
Congress
that the
to
Selection,
the
to
American
facade
a
outside
try to
an
superiority
prime
dent
been
of
one
in
one
means
istration
nuclear bombs. This will be the
Reds'
not
the
way
Senator stated
advisers
any
That
all
and
of
will
its
knew
President's
com¬
Europe out of the
that
for
advance.
the
propaganda
is
directed
at
trying
to
Western
he
sulted
of
inferior numbers.
It
Practising.
—
Association, 330 West 43rd Sfr,.
New York, N. Y.—$4.75.
;
this
keep
the
present
Guide
—
and
Senator
Committee that
as
to
outside
could
Senators who
one
have
But the
because
—
pro¬
testi¬
expenses.
Senator
in
open
the
Secretary's testimony got the
impression that if it hadn't been
avoided.
West,
said, is entirely incapable
fighting the Reds with con¬
Secretary's
or¬
any
the
as
this extra-legal
continuing
Adminis¬
consulted
could
secu¬
tailspin
a
point
a
Congress," observed
called
The
weapons
Losses
Salesmen—Milton
dell
Hum¬
clarifed
wanted
expense
it
.
"any
Republican
thereafter overall business vol¬
ume
on
bill, this "mess,"
White House Snafu Continues
Should
were
of
the Administration
The
istration
Case, in advance of drafting the
other side.
rities
it
outnumbered.
of nuclear weapons,
can-
it
World still would be heav¬
ventional
Harnett
Company
made it clear the Admin¬
mony
bill, which it
attempted to report
kill
tration
concen¬
essential, for even with
sight, the West¬
"sell" 'some
you
Committee
Roads
if
could
is
of
cedure.
the bill Chairman Harry F...
Byrti of the Finance Committee
point
be
is seeking
.
Secretary
testimony
why
reason
ap¬
out
If
break
phrey's
and
The
Eisenhower's
der.
to
Means
and
Committees.
for
for
all the forces in
it
Ways
Public
to
concen¬
some
and
Institute, 20 Vesey Street,.
York
7, N. Y.
(paper),.
New
&
Incidentally,
money is a mat¬
the
Appropriations
Committees. Even if the Senate
ter
isn't,
have
Chairman Demmler of the SEC,
legislate
airs!"
on
Law
budget, however, remains to be
seen.'
'
**.' ■"
/•. •/: :
propriating of
through,
lutely
ily
the
the Western powers could
and
would
use
nuclear
use
simply cannot report
bill allocating revenues or
a
for
to
three
is
who
pointed out that
put
appropriating money. "The fool¬
ing with revenues is a matter
to
forces
own
their
oil
impressed
was
"
wet
out
sufficient
the
trate their forces at
points
York,.
$2.00.
away.
would
fairs, the Arkansas Senator,
hand,
to
assigned,
12
considerable concentra¬
prehend
other
like
Finance
to
a
oughly indicted the state of af¬
the
"No, they're not for sale—some people just
a
western
gets
Gains
Bertram
outnumbered,
not
Mc¬
—
-
Capital
aircraft,
and
some
300
light
naval
craft,
THEN the Western European
trations.
scared
Smities
N. Y.
occupation
weapons
cor-
United
in
Arthur
time the forces
hopelessly
a
the dickens out of the financial
an
outlined.
of the Western
are
NATO
lor
strategy
At the present
same
the
At
the
Process
—
r
(paper), 25£.
25, D. C.
Budgetary
Graw-Hill Book Co., New
basic
;
Printing Office, Washing-
the
ern
Senator
If
ap¬
'•
Govern-
States
then
it
rectionu
.
ton
has
France
S.
U.
Documents,
proved the Western agreements,
or
legislative
need
of
ment
that
Renewal
Cities—Urban
Several
Administration—Superintendent
does th»
as
States.
Now
results
problems which
no
bombs
Outline Strategy in Europe
that
public
the
caution.
sees
clearly
the
He feels
study.
Approaches to Urban Renewal in
nuclear
Since, with German help, the
hearings
Senator Fulbright
of
ia
(b)
needed
to
ca¬
if the Reds have
even
as
ot
trained
men
delivering
of
stra¬
successfully,
weapons,
legislation.
by
Now
over,
high
and
economy,
which
or
to
as
present
that he knew of
of
In
be¬
not
either
force,
them
bring
the
is
it
place,
S.
period.
three-year
second
U.
is limited to
lieved that Russia has the
tegic
>
1,300
high
so
that
effect
the
or
forces
jeopardize
j
to
lately
nuclear superiority
the
was
reliable >
place,
Germany
said
views.)
own
which has been put out
dogma
that he wanted to learn whether
market
.first
military observers discount the
divisions,
in
he
when
"Chronicle's"
threat.
When
it is believed,
disclosed
intentions
the
is
to meet the Russian
Army
greater
a
Europe.
this.
onto
pretation from the nation's Capital
and may or may not coincide with
three years more,
not put
the leadership did
y,
re¬
flect the "behind the scene" inter¬
last for
will
States
or
to
is
that
or
It
own.
the
by
leadership,
free
a
enterprise of his
cratic
oper¬
was
inquiry
this
United
only
('0„ Ark.), the Chairman of the
Banking Committee,
the theory
superiority of
nuclear
the
the
of
public /hearings-4 under? pres¬
ently foreseeable circumstances.
•
its projected size, on
that
BS 69
|
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@FedFRASER