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6VJ5-
K
lifY 1 7 1!
Final
Edition
|
.
,
ESTABLISHED OVER 100 YEARS
In 2 Sections-Section
1
COMMFPnT AT.
e
m
AJLJIJk
®
JiJb JbJLJI
Reg. IT. S. Pat. Office
.Volume 163
Number 4490
New York, N.
The Farmer and
Postwar
By NEIL H. JACOBY*
Newly elected President of New Jersey Bankers sees avoidance of
inflation as chief problem ahead. Advocates balanced budget and
reduction of bank Government bondholdings through debt redemptions. Points out new outlets for bank funds in financing '
durable consumer goods and in real estate mortgages, but cautions
against taking unwarranted risks in these fields. Says problem of
managing Government debt can be solved through hard work and
the practice of rigid; governmental economy. Warns that any at-1
Section U. S. Savings Bonds Div.
out the
irospects of continued high farm¬
ers' earnings, cautions against the
use
of
of
farm
surplus earnings in purchase
land
at inflated val¬
in
vestment
in
speculative
se¬
or
their position and urges bankers to fight any proposals based
that premise.
and
curities
Says
farming: busi¬
nomic conditions
and
quires
;
problems and to aid in restoring sound
the past few years,
accumu¬
re¬
the
and
we
Cites previous depressions, and states that poli¬
be devised for preventing extreme business fluctuations
within framework of a free market, competitive enterprise
system.
can
Holds
production not
an
inflation antidote
V~
must study continuously to keep
up
,
me
to speak to you
Hong
Bonds.
The
American
ever
farmer
entered
been in. He has, in
aggregate,
What Price
more
in
money
;
United
and points out it was
vic¬
the
of
one
to
'
ever
before.
His
since
than
down
in
of
This
war
$5,000,000,000
salted
won
by
Bonds and
United
He
1915.
War
has
a
reserve
States Savings Bonds,
(Continued
on page
the
F. R. Peterson
and
by % the
tre-
mendous
2698)
productive
•'
.
_
Of
capacity
the country. The war has demon¬
♦Address by Mr. Townsend be¬
fore the Mississippi Bankers Asso-
iation, Biloxi, Miss., May 14, 1946.
strated
clearly $ the a inherent
strength of the system of private
enterprise, because we not only
produced an avalanche of war
-
materials
Index
age
of
Regular
2700,
'
Features
on
■" >i
L. E. Carpenter & Co.*
(ontinued
Jersey
Corp.*
•
Prospectus
on
managed
to
on
address
page
com-
2680)
by Mr.. Peterson
before the convention of the New
Nu-Enamel'
♦
also
:
lantic
Aerovox
but
produce huge quantities of
♦An
request
reserves
to
The- world is
began about 14
currency
and
in
an
ago.
years
i
2-0600
Cleveland
Chicago
Geneva
64 Wall
Teletype NY 1-210
Albany
Baltimore
Dallas
Pittsburgh
Springfield
(Continued
on page
MM FUNDAMENTAL
,:
..
1
•/
prospectus
-
BOND
WoonsockeJ;
or
from
-
iNC.OKPOtATiP
WALL STREET
NEW YORK
the
nation,
The
'
y^y
Jacoby
I
,•;
-
^orld's
;• % '
J
destructive
most
(Continued
♦Address
before
Bankers
Claude L. Benner
by
the
2666) f
on page
:
Professor
American
Association
Jacoby
Industrial
at
Chicago,
May 9 1946.
huge expenditures
era
of cheap money
State and
] ,,,<l f
Bonds
r
s
.«
v T'
>-i,V
and Dealers
Bond Department
,
30 Broad St.
Tel. DIgby 4-7800
New York 4
90c
NATIONAL BANK
"
OF
THE
NEW YORK
Company
Midland Realization
Conv. Preferred
Company
^Raytheon Manufacturing Co.
$2.40 Conv. Preferred
•„
CITY OF
€ Midland Utilities
Preferred
.
MARKETS
1
CHASE
Tele. NY 1-733
*Solar Aircraft Company
'
V
York Stock
Exchange
Members New York Curb Exchange
Members New
Alloys, Inc.
Conv.
THE
Hardy&Co.
\
LOS ANGELES 14
&
Brokerage
^Detroit Harvester Co. Comh
SECONDARY ?
Neil H.
current:
of
•
'**
'
634 SO. SPRING ST
5
Common
FINANCE
BROKERS
t he
for Banks, Brokers
HUGH W. LONG and COMPANY
48
CORPORATE 1
%
o
remarks about
Service
dealers
authorized
.
be
may
Acme Aluminum
J
few
from
obtained
Wilkes-Barre
New Haven
t
a
2674)
Bond
INVESTORS INC
PHILADELPHIA
Buffalo
Syracuse
Washington, D. C.
Scranton
m e
of
by the World War has not brought this
Street, New York 5
BOSTON
Troy
London
(Representative)
i t
state
with,the New Deal.-, Even the financing of the
1927
INVESTMENT SECURITIES
25 Broad St., New York 4, N. Y.
HAnover
Established
j
today we need
perspective
a b o v e
a 11
make
started in with the rise of Hitler and the rearma¬
ment of the Third Reich. In this country It came
caused
may move
a
m
cheap money. It
In England it had its
era
sug-
i things. Before
proceeding tothis task,
per-
of
excess
'
Municipal
R. H.Johnson & Co.
CO."
HIRSCB, LILIENTHAL &
Members New York Stock Exchange
and other Exchanges
%
.
bonds. ^ Holds this policy has
of
•
solution,
believing that
rates
inception in the fall of 1931 when that countryabandoned the gold standard.
In Germany it
request
on
to
,
Association, At¬
City,:N. J,, May II, 1946. -
Prospectus
to
money
enable
COMMON STOCK
Successors
under low
war
deposits and savings. Contends that to
Keynesian theory of "a vanishing inter¬
est rate" implies a continuous control of prices and
rationing to hold back its inflationary force, and
when these defenses break down, or public confi¬
dence in currency is impaired, it will result in a
costly price for cheap money.
Bankers
Liberty Fabrics of
New York, Inc. )
Hirsch & Co J
we
•
follow the
the
o f
men
along
individual
was
gallantry
our
Now add to that good news
sufficient
resulted in expansion
*
more
can
lines
which
gest
accomplished by Federal Reserve banks furnishing
with
them io buy Treasury
mortgage ! greatest wars
indebtedness is at the lowest point in history.
than
banks
member
torious from
>»ank and more cash in his pocket
a
we
view of
problem,
and
i
By CLAUDE L. BENNER
Insurance executive analyzes the financing of
States
emerged
the
the
Cheap Money ?
Vice-President, Continental American Life Insurance Company V
During the
past year the
1946 in the best financial shape he
has
ns
world.
the
a
this
and
country
avoid
I propose to take
•
throughout the
Morris M. Townsend
in g s
d i t io
c o n
how
on
"boom and bust" economy in the United States.
with
changing
Iff: You have invited
*
lation of cash
con-
i. The Aftermath of War
changed drastically in
economic
jfeserves, such
as U. S. Sav¬
and that price
I; trols ignore fundamentals. Advocates restriction on money supply and increase in interest rates, yet endorses the "compensatory
fiscal policy," but only if we act vigorously in other
spheres of
economic policy,
J
f
eco*
no group or organization should be
permitted to
damage health, welfare and safety of nation, and says our economy
has not yet demonstrated a capacity to maintain high production
cies
'
on
inflation. Contends
$ and/employment.
throughout world.
The theory and methods of banking have
is hazard-
ous
Dr. Jacoby sees depression threats in industrial warfare and price
x
Expresses confidence in nation's future and its ability
to resolve domestic
ventures.
ness
Professor of Finance and Vice-President of the University of Chicago
tempt to solve it at the expense of banks is bound to undermine
in¬
ues
Economy in the United States?
President, New Jersey Bankers Association
Investment
Treasury official, in pointing
Copy
a
Ho w Can We Avoid' Boom and Bust'
Banking Problems
President, First National, Bank of Paterson, N. J.
By MORRIS M. TOWSEND*
&
Price 60 Cents
By F. RAYMOND PETERSON*
National Debt
Director, Banking
Y., Thursday, May 16, 1946
Analysis
upon
request
'
V
Bull, holden & c°
TELEPHONE-RECTOR 2-6300
-
■
"*•-"V*-V
'
•
^Universal Winding Co. Com.
*Prospectus
INCORPORATED
Members N.
5.N.Y.
'
Kobbe, Gearh art & Co.
MEMBERS NEW YORK STOCK EXCHANGE
14 WALL ST., NEW YORK
■
Y.
Tel. REctor 2-3600
New York 5
Teletype N. Y. 1-576
Philadelphia Telephone:
Enterprise 6016
HART SMITH & CO.
request
Reynolds & Co.
Security Dealers Ass'n
45 Nassau Street
on
Members New York Stock Exchange
52
120 Broadway, New York 5, IV. Y.
,
v
•
Telephone:
Bell
REctor
Teletype
NY
York
WILLIAM
Security
Dealers
ST., N. Y. 5
Bell Teletype NY
Assn.
HAnover 2-098*
1-395
2-8600
1-636
New York
-
-
Members New
and
Members
New
ira haupt & co.
New
Toronto
York Stoch Exchange
Principal Exchanges
10 Post Office
York 6
REctor
Tele. NY
Montreal
other
llf Broadway
2-3100
1-2708^
Direct
Private
Boston
Sq.
9
'
Hancock 3750
/>,:■
;;■■■
Wire to
f
f
Boston
:
Trading Marketi in:
United Nations Vigorously Planning
A Better SociaLand Economic World
Benguet Consol. Mines
Wiggins Industries*
National Skyways*
Gerity Mich. Die*
Alabama Mills
Ass'n
Nat'l
4Q
BELL TELETYPE
r-'v:?;
?;?;?'
;;aa:
Bought— Sold — Quoted
?
May 15.—In welcome contrast to the dissension which has
proceedings of a political nature here and at Paris, much progress is being
made toward formulating UN's social and economic policies. The result of the current activ¬
ities will be completion of the modus operandi of the Economic and Social Council when
it convenes here May 25. v
-rV • ""
"?
*•
■' ' ■a.
Remarkable will it be if the Council ever is able to fulfill the extraordinarily wide
frame of reference which the temporary commissions are now devising,-for curing the
world's ills; I In addition to drafting a complete International Bill of Rights and devising
hamstrung the
Inc.
Dealers,
Securities
of
HA 2-2773
Bxchang»gl.,MT.Y.5
S CR., INC.
* 4'
HUNTER COLLEGE, N. Y.;
V. "!
V
Dealers Ass'n
Members
Security
'k'Qy
By A. WILFRED MAY
*
of exceedingly wide scope is being formulated for Economic and Social Council.
Selection of commission members interpose* nettlesome problems. .# World Trade and Employment Conference to1 tohvene in Fall.
UN trusteesHip? plans obstructed by self-interested. Big Power politics.
1920
Established
York
:
P. R. MALLORY
Ambitious program
KING & KING
New
|
•
: s
Prospectus
♦Witt
Thursday, May 16, 1
FINANCIAL CHRONICLE
THE COMMERCIAL &
2638
NY 1-423
Steiner, Rouse &C
Members New York Stock
25 Broad
HAnover 2-0700
,.
V
■
V
Pharmaceutical
.1
y.
C\.
.
- v
.
-
V
:'
1
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.v
a
V-
.
...a
?'... ■■■'•■
New Orleans,
Direct wires to
Organics "A"
an
.
Trend of Interest Rates
of
the
means
agency,
;:
.
i
j
i
Human
o n
under
Rights,
Roosevelt's
MitcMUCoiipiuj
chairmanship,
has placed on
the
a gen d a
such problems
as
prostitution, polygamy
Baltimore Stock Exchange
Broadway, N. Y. 5
.WOrth >2-4230
\
Members
120
,
N. Y. 1-1227
Bell Teletype
.
1
'
'
>•
Rogers Peet
Roosevelt has
Mississippi Shipping
press
Common
Social
its
from
i :!
."' \
Vanderhoef & Robinson:
New York 5
Nassau Street,
31
COrtlandt 1-4070
telephone
Bell
1
t
1-1548
System Teletype NY
mere
Corporation
•
continues
dun
engaged
be
to
and
the
b
'•.
*
H. G. BRUMS & CO.
20 Pine Street, New York
Mc Donnell & fo.
5
Members
Teletype NY 1-1843
-
New
?!
'
?
BROADWAY, NEW YORK
120
1
r
York Stock Exchange
New York Curb Exchange
•
Tel.
REctor
Raymond
n,
reluctant to
are
ac¬
•
W
2-7815
May 10, 1946.
T"
-•
Colonial Mills
We Maintain Active Markets in U. S. FUNDS for
POWER &
1
MacfadcTen Publications
&
PAPER, Common & Preferred
BROWN COMPANY, Common &
Preferred
BULOLO
GOLD
&
ONTARIO
Prospectus
request
'
"I
Canadian Securities' DepV
;
PAPER
,<
,
that
Members N. Y.
used
.
37' Wall
St., N. Y. 5
Members N. Y, Stock Exchange and Other
Hanover 2-4850
Teletypes—NY 1-1126
&
115 BROADWAY
!
Telephone BArclay 7-0100
Bell
(
1127
-
;
'
For
Banki, Brokers &
,r
'
.
V
J
"vn-
t
GENERAL
■
Argo Oil
y:
San-Nap -Pak Mfg. Co.
Common
'
—
Members New
York Stock
Exchange
25 Broad St., New York 4, N. Y.
HAnover 2-0600
1!
Tele. NY 1-2908
dl
inr
Trosler,Curries Summers
Trinity Place, N. Y. 6
HA 2-24O0
Teletype NY 1-376-377
Private Wires to Cleveland
^Detroit - Pittsburgh - St. Louis
,
Buckeye foenbator
/.
Consolidated Film lnd.
Consolidation Coal
the
SI
SOLD
—
QUOTED
J-G-White 6 Company
INCORPORATED
bonds
war,
.
are
I.e.,
in
sales
(Continued
the
Chicago^ Mil., St. Paul Vfe Pac
5s/2000
Minneapolis & St. Louis R.R.
'
All
Issues
GUDE, WlNMILL & C
Exchange
Members New York Stock
1 Wall St., New York
5, N.Y.
Teletype NY 1-9"
DIgby 4-7060'
v
Colonial Stores
Dixie Home Stores
Macfadden Pub. Inc.
Pfd.
STREET
NEW YORK 5
;? ESTABLISHED 1890
Tel. HAnover 2-9300
&
Com.
4-4
Southern Textile Issues
banks.
of bonds to
2662) ;;??<
Members New York Secvritp
Tele. NY 1-1815
Dealers Ast
Y. 5, N. Y
Teletype NY 1-23
REctor 2-7630
on page
Jefferson-Travis Cor
Curb and Unlisted
Securities
Western Union
Leased Line Sto
International Ocean Telegraph
Pacific & Atlantic Telegraph
t
WALTER KANE, Asst. Mgr.
-
Joseph McManus & Co.
Members New
37 WALL
-
Western Pacific 5s/46 '
Southern &
York Curb Exchange
Chicago Stock
39 Broadway
Digby 4-3122
-
told
-
Teleg.
quote
Arnhold and S. Bleichroe
INC.
Exchange
New York 6
Teletype NY 1-1610
Atlantic Teleg.
Empire & Bay States
bought
Members N. Y. Security Dealers Ass'n
YORK
HAnover 3-94
deposits, which can be
and over again, as long
MICHAEL HEANEY, Mgr.
—
NIW
'
120 Broadway, N.
-
BOUGHT
74
enormous
an
Common
Sold
'■Bought——Sold—Quoted
Simons, Linbarn & Co.
had
CORPORATION
Bought
York Curb Exchange
8T.
C. E. de Willers & Co
MACHINERY
Common
•
WALL
$100,000,000,000 in bank deposits
due id the method of financing
Principal Exchanges
Trading Market
Harrisburg Steel Corp.
Members New
put it another way, we have
had
an
increase of more than
NEW YORK 6, N. Y* C * *
*
Teletype MY 1-672
Dealers
over
the
.
Bowser Inc., Com.
we
To
Goodbody & Co.
Security Dealers Assn.
Frank C. Mastersou & C(
deposits
in
crease
•'
as
^reeuecmiCompcm^
there; were other
increased * or de¬
and reserves,
money" in cir¬
culation, gold movements,
etc.,
but the main thing to remember
STEEP ROCK IRON MINES
!
England Co.
on
:
MM
financing
such "as increase in
is
Northern New
which
creased
Preferred
DREDGING
MINNESOTA
>
★
°
course,
factors
ABITIBI
^Common
Of
;
*Holiy Stores Inc.
mmm-
debt
war-born
methods
the tests of peace is the
and
reserve*.
?
Stamped Preferreds
Units
purchase of which, created; an
equivalent amount of deposits and
'
-
structure
':?•"
Eastern Footwear
Teletype NY 1-1140
Peace':>? •?
of
the
Whether
headed
Boston & Maine RR
'
Test
The
Rodgers
,
Prospect Hill Apts.
r
cept the evidence of reality. The can meet
tragic history of war finance of¬ question now foremost in the
fers no parallel to the amazing minds of bankers. My talk today
accomplishment of our bankers will be an attem pt Xti answer that
and our Treasury in financing a question.
: '
r
At the end of January, the com¬
war, expensive beyond imagina¬
tion;? and: at the same ; time re¬ mercial banks held $91,800,000,000
ducing the interest rate.
| : of the direct and guaranteed debt
and the, savings banks beld an
Of course, it would have been
additional
$10,900,000,000.
The*
better if " more of the bonds had
purchase of these bonds was pri¬
marily responsible for the in¬
*An address by Professor Rod¬ crease in bank
deposits of $102,gers before the 42nd Annual Meet¬
700,000,000. In addition, the Fed¬
ing of the New Jersey Bankers eral Reserve banks held $23,264,Association, Atlantic City,N. J., 000,000 of government bonds, the
Bought—Sold-^Quoted
Telephone: WHitehall 3-1223!
Bell
-
wo
:
Colonial Utilities Corp.
64
has
war
e en
It
own.
world, as well as our
met the pragmatic test of
the crucible of warr we won!
today,, after
prevention^ of crime.
2682)
rest of the
so
dous that even
;;
■
Common. Stock
the best we
it
financed
magnificent
adoption, med¬
on page
we
and stupen¬
^rations
Guaranty Co.
the manufacture
in
of.
:
government
financing op-s
Home Title
j
primarily
of hats and hat machinery.
s
Central States Elec. (Va.
by taxation. • And it would have
been best pf all if we had hot had
a war.
But we did have a war
sufficient
wi.h
Machinery Corporation, Byrn¬
Hat
It would have been still better if
the war had been financed more
f
businessmen
U. S.
America and
of
been sold to non-bank investors.
of the
o
System Teletype NY 1-1919
<s>-
Di¬
in all se¬
riousness, that "best" was unbe¬
lievably good for a democracy;
It was good enough to finance the,
war effort of ;a large, part of the
hard
in Hat
mirage.
Broadway WHitehall 4-812
Bell
could. And X say to you
Byrndun Corporation
of stock
a
and
(Continued
ownership
or
Exchange
Members New York Curb Exchange
50
characterized
and maintenance,
Through
Members New York Stock
our
America
marriage, iUegitimacy, separation*
care
Edward A. Pureed & Co
methods of war financing
With these words, on March 22,
whether
seen
United
the
State
has
:•
ical
-
Commerce
of
Commission
miracle
a
Chamber
food,, housing and' clothing "cou¬
pled with redistribution of wealth
and wages; to concern itself " with
York Curb Exchange
New
Members
rectors
be
the
of
Board
\
,
*
individual
every
than
Jockey Club
business to other than
possible to take time out
basic aim of providing
found it
.
"
field
activities;
The
1946,
pointedCout,."covers
wider
.much
a
W. &J.Sioane
'/' '-V
have been
devising means of bringing about
freedom of information through¬
out 'the world; which>aim, as Mrs.
Common.
■'
"It remains to
is
commission
Monmouth Park
financing Government
Ihis
Moreover
*
Adams Hat
Chicago Corp.
prospect of materially higher rates because of need of protecting
value of Government securities. Holds bank* will not increase hold-:
and euthenics.
A.-Wilfred May
i
no
ings of Government debt but will divert
branch offices
Textiles, Inc. :
Professor of Banking, New York University
[ Asserting there is no parallel to the amazing accomplishment in the -j
war's financing accompanied by reduced interest rates, Professor j
Rodgers contends that this will not continue and that lowest point
in both short* and long-term rates ha* been passed. However, sees
Eleanor
>
|
.
our
Globe Union Inc.
By RAYMOND RODGERS*
Commission
Bought'^Sold'^rQuoted
.
Anderson Pritchard
*
thereof
tion
by
NX 1-1557
La.-Birmingham, A
..
implementa¬
.
Exchange
St.r New York 4, N. Yi
30 Broad
WHitehall
St.
3-9200
New Yor
Teletype NY
1
.Volume
Number 4490
163
THE COMMERCIAL & FINANCIAL
CHRONICLE
Budget and Money Market
MELCHIOR FALYX
cial
; ?
Looks at South America
abeut through ending of hostilities and not
by retain to finattForesees renewal of deficits should inflation gain
orthodoxy.
Herbert m. bratter
Impending, commercial credit expansion and renewed inflow of gold.
*
■
.
•
■
■
>
cial needs, for further development of
Good News?
balance—nay, showed
long
deficit
cluding
Federal
i
first
n
tracted
here
to
$18.9 billions
as against
$43.2
billions in the
Dr. Melchior
period of
Palyi
realize
to
duly 1, 1945 to May 1, 1946
in
expenditures
•;
President
for
$30.4
-
»—
Reduction of Treasury revenues $1,7
RIbc in "general" expenditures,
Veterans'
inci.
Rise
.
Administration
in "transfers4'
to
3.7
trust
accounts'' ,^.,,,*.^-1...^
.
0.8
,
Net reduction of deficit______
,
6.2
may
Herbert
M.
estimates
That
deficit
a
takes
(Continued
on page
,
fi
„
4
1
y -;iv
*
1
v
"
11"
member
We offer for
HAnover 2-8970
silver creek
head
By LEWIS W. D.OtJGLAS*
President, Mutual Life Insurance Co. of
'Mr*r
Douglas
'
'
'
'
Prospectus
'
J. F.
New York
40
contrasts
tragic situation of Europe Today with close
ofWorldWarl when ramparts of Western World remained intact
It is? often, by
.
that have gone
contrasting the times in
before, that
men;
obtain
which
we
68
the
.
sum)
total, qfr
to the cohditioh and:the estate of
:
Europe as it was only 25 years ago
at the close of World War I,
;
Italy, although she Was about tb
start on a path leading to moral
corruption and disintegration, sat
BOUGHT
at the council table of the victors
WJ
in the Mediterranean.
power
(special
account)
It
can
be
said that
the
floating money-capital
to create
measures
mone¬
(Continued
a
Belgilim^-partly
ravished by
the,,
invading ^hordes—emerged
government intact and
were
on page
request
SOLD
Est. 1926 "
'
•
.
QUOTED
_
JT*/
; ^
.
.
^*Aneddress. by Mr; Douglas be^
fore United States
ternational
Associates, In¬
Chamber
merce, New
Haytian Corporatioii
Corh-
of
York, May 14, 1946. %
Punta Alegre Sugar .J
Eastern Sugar Assoc,
.
/"
offerings of
;
i
Lea Fabrics
*
U. S. Sugar
:-;vr
General Aviation Equip."
Pressurelube; Inc.
Utility and Industrial
PREFERRED STOCKS
2664)
•
,
Public
only
York
\ Members New Yorlc Security Dealers
Assiitt170
Broadway i
WOrth 2-0300
Bell System Teletype NY 1-84
an
(Continued o.fi page 2657)*
High Grade
static equi-
New
HtRioD&lo.m
;
a
on
*
.
.
ip mora than one direction.* The
-
Susquehanna Mills
'
(-1 :^:v V ^
'
rj>
'•>
: ?
1'
tary prospects towards the end of
the year were highly satisfactory.
The "floating purchasing power,"
created during
pation
•See
the
—
the German
financing
"Holland's
"Chronicle"
by
Financial
creating
Position", in
Spencer Trask & Co,
Leland Elec.
occu¬
25 Broad Street, New York
Mergenthaler Lino
Telephone HAhoveP 2-4300 ;
of Dec. 13, 1945.
CERTIFICATES
Bond & Mtge. Guar. Co.
Biida Co.
Capital Stock
Co.
Members
32
v
N.
Y.
Security Dealers
Broadway
ewburger, Loeb & Co.
St., N.V. 5
Boston
Stock Exchange
CHICAGO 4 ..,/
,
Harrison 2n76
Teletype NY 1-832. 834
Direct
New
> WHitehall 4-6330
^
Service, Inc.
National Radiator Co.
,
Wire
Teletype CO 12t
Service
City-—Los
Angeles
j
■
pmiM
^Prospectus
Hon, Rose STRgsiER
;
.
;
74
-
York—Chicago—St. Lotm
Kansas
& Tr. Co.
Assi,
Board of Trade Bldg.
DIgby 4-8640
Bell Teletype NY 1-2033
to
Parks Aircraft
Sales &
Bought—rSold—Quoted
STRAUSS BROS.
NEW YORK 4 ;;
0 Wall
Wire
Public Nat'l Bank
Lawyers Title & Guar. Co.
York
Private
Fuller Houses, Inc.
Lawyers Mortgage Co. ';V;
Members New
WHitehall 3-0272—-Teletype NY 1-956
*
Amer. Furniture
Prudence Co.
25 Broad St., New York 4, N. Y.
,
Teletype* NY 1-5
Kearney & Trecker
TITLE COMPANY
N. Y. Title & Mtge.
DUNNE & CO.
.Members.New York Security Dealers Assn.
Member* New York Stock Exchange
-
.!
Established 1914
C. E.
,
Members
Trinity Place, New York 6r N.,Y.y
Tpjrn^ove'
BOwling Green 9-7400
"
Chicago
Engineers Report
:
I
We'are interested in
'■
CG-0tG-
AXELSON "'mfg. co.;
:
New Measures Needed
| Since * the beginning of>. 1946
however, the situation has changed
TWX
Cleveland
Los ftngeles
r;;
-
with
cv---
-
Boston
to turn your memories-backwards
—a
5
1-2733-4-5
a
n g—
u
NY
live with those
i
iirs
TWX
La Salle St., Chicago 3
:Private Wires:.>''■-'A-
\
'
So.
Devonshire St., Boston 9, Mass.
.
* Richmond 4321''
'' '
;;
1
of
p
'./' i
been
Reilly & Co., inc.
2-4785
Randolph 8924
:
and
have
money-purge and blocking of the
deposit
39
'
•
Request
on
Exchange PI., New York
HAnover
persp,ective---a view of the
—• • •' 1 ' '"
on a sound
understanding of the
past.'f Therefore^ let me ask you
c(>ufg;e tney
/;
with the Netherlands Bank.
^
Teletype NY 1-1203
.-v,,
.
precision
•
jpaymentsj and thus,at the dis¬
Broadway
New York 6, N. Y.
•,
■
ment
39
-
Herbert E. Gaston
emphasizes need of determining^Gerinany's status and recommends
j loosely associated federation separated from Ruhr and RhMand.
billion)
was changed into
bills of rather short ma¬
turity (also to be used for tax
share
per
1 Members New York Security Dealers Assn.
econo¬
-
.
posal of the Treasury as Govern¬
/at $10
l. J. GOLDWATER & CO.
recently was a
Treasury Demonetary research
t h e; accumu¬
($1
..JklL*
Rockrite Processing
,
;
:
sale;...';
^ 1500 Shares of
.
1
[
we languished in isolation.
Urges us to strengthen England
land France and assume world leadership to save civilization. He
f}
:r
'
|
of;the
AMSTERDAM, HOLLAND — After the money purge in the
lated changei
Netherlands* was completed, at the ehd of December, according to the
that have oc¬
Minister
of
Finance,; Professor^-*• 1
'
^
curred.
ConT'
Pieter Lieftinck, the bank note banknotes— was
tightened up.
trast
fre¬
circulation
of. the
Netherlands Everyone ;Was^as-the! Minister of
quently ■ pro¬
|Bank was fl. 1.110 million ($420 Finance said—obliged to live Out
vides a meas¬
million). The total Of blocked ac¬ of one's income; .it was impossible
ure! by which
counts* amounted to about fl. 4 H to effectuate large purchases that
conduct may
billion\ ($1.7 billion h of ; which could cause an inflationary- ten¬
o$ ireassessed
about fl. 2 billion ($800 million)
dency," as qmdney' was very tight.
and old viewsThe official ceiling prices of the
was locked up in the shape of 3%
once
firmly
Lewis W. Douglas
non-negotiable Inscribed stock. It rationed and other goods (still
held may be
is to be used for payment of the
only small in ' quantity) were
ret.ested and adjusted.
extraordinary levies, to wipe: out rather easily maintained by the
"All our hopes of the future,"
money
purchasing power, arid Dutch Office of Price Adminis¬
said Professor Harrison, "depend
to lower the floating fl. 23 billion
tration.
jtreasury
Obsolete Securities Dept.
Telephone WHitehall 4-6551
par¬
an
Tit e Wo r 1
't \
2665)
01, m/T'U/.
grin
•
••
WALL STREET, NEW YORK
•>
in¬
given the "Chronicle"
partment's
;
of
Netherlands observer reports tliat economic conditions there are
relatively Satisfactory, and that the wage-price situation is becoming
balanced,
Holds sound budget policy being pursued. .Feels Hoiland's most difficult remaining problems lie in public, finance and
foreign exchange restrictions.
<$900 million) government debt.
The remaining fl. 2Vi
billion
j
90
new
£
us
on
economy
:c:-; A--:
1
the desire for the-rapid develop™eir resources is very strong. This is not
primarily a selfish
*
(Continued on page" 2659) "•
Y
account
"Algemeen Amsterdam'*.
>„*' iv'
big
a
them
division.^"Throughout Latin America
By J. VAN GALEN
•
Bratter
...
•
,
a
Dump
opportu-*
Ness is the bank's- chief
mist and until
sidies j(up -to = $2.4 billions); but
not of the housing, subsidy, of .$0.4
billions, the $440 pay raise for
Financial Editor, Amsterdam
circuit of
a
equivalent of
.
Dutch Postwar Reconversion
'j
economic
the
City, Bogota, Quito,- Lima, San¬
tiago, and Rio de Janeiro. Mr.
/
.
is
area
to
big
great
you've lost in
money
instead.
part of April, Mr. Gas¬
ton, accompanied by Mr. Nor¬
man^ T. Ness, visited Mexico
of the continued agricultural sub¬
$24.2
switch
those
out
obscletes.
latter
.
t
aid
port-Import Bank and formerly
Assistant
Secretary
of
the
Treasury.-; On a trip by plane
lasting from mid-March to the
,
-
those
coming fiscal year/the
billions.
$3.6
of
letting
sighs about the
.by Mr. Herbert Gaston, a mem||.; ber of . the board of the Ex¬
For the fiscal year
whole, Lhe deficit,
For the
(in billions)
activities"
a
entire
riity, calling for American
From
but admittedly this unusual show¬
ing is not likely to be duplicated
next year.
v
?below:
"war
billions.
fall
short bf .thfe budgeted $28.8 bil¬
lions by as much as 7 billions,
as
how^ this
^"economy" had been accomplished.
J This is • shown in the tabulation
■?<-,
$2.4
15.—The main impression from
the
terview
war
to accelerate.
last year. It. is
instructive
by
on,
report
resources,
I
ticipation, according to
expenditures will
be cut. at a progressively ilowed
down rate, while the decline of
tax revenues and .especially: the
rise of civilian expenditures tend
year
Reduction
that
the
spent on war has • been " accom¬
panied by, 12 cents - additional
spending for civilian- purposes.
Moreover, income tax returns con¬
ten
amounts
by!
matter of fact, every; dollar le$s
a
months of this
jfiscal
i
fashion
region's
ECONOMY SIGHS
Stop
out.
frontier
ending of hostilities, riot by any
return to; financial ^orthodoxy. As
trust
accounts)
"automatic"
an
THE GIANT
;
"-j'^.WASHINGTON, May
Latin America
deficit has been brought about in
•
any
(in¬
t h e
jj
as
The spectacular decline of the
;
rate, the total
same
period
a
.always efficiently carried
is
At
the
of revenues—for
excess
Good
news, indeed,
if it
would
Jast.
modest
a
Federal budget has been in
two
as
mo'nths.
v
general desire for economic advancement. Say work on Bankfinanced projects in Lutin America Is
being honestly, though not
■
For the first time in 15
years, the
AND COMPANY
of Export-Import Bank, just returned from a tour of South
j America inspecting Bank-financed projects in that region and finan¬
"
llCHIEflSIflfl
-
] Officials
,
force and only remote
possibility of reducing national debt frofii
budgetary surpluses. Predicts a further rise in bank deposits with
,
2639
Expoit-Import Bank
V^-iW^ y'Q
Dr. Palyi points out that
spectacular decline in Federal deficit ha*
come
W
•
Teletype*?
61
"
-
^ *
NY 1-375 & NY 1-2751
upon request
Unterberg & Co.
N.
Y.
Security Dealers Ass'n
Broadway, New York 6, N. Y.
Telephone
BOwling
Teletype NY
Green
1-1666
9-3565
2640
.
Li
_
' '"'Thursday.
ELCINORHClj,.., NANIF&
ftAIC
rokMERCl/(L
..THE
U N and
May 16, 1946
Big Business
ACTUAL MARKETS
IN 250
ACTIVE ISSUES
Transport!;
Air Cargo
Air Products-Units!
American Bantam Car
Anchorage Homes A&B
Assoc. Dev. & Research
Automatic Instrument
Barcalo Mfg. Co.
,
Bird & Son
'
Chicago R. I. & Pac.
Old Pfds.
Cinecolor
Dayton Malleable Iron*
Deep Rock Oil
Douglas Shoe*
Frontier Ind.
General Mach. New
/
Getchell Mines
Gt. Amer. Industries*
Hartford-Empire Co.*
Mastic
Asphalt
^
Michigan Chemical
Minn. & Ontario Paper
Missouri Pac.
old pfd.
Mohawk Rubber*
fib!H&i Moxie;v;#'!£fi
N. Y. New Hav. & Hart.
Old
Pfd.
>
„
| Purolator Prod.*
Bowser Inc. Com. & Pfd.
*Crowell-Collier Pub.
United Artists
Bought - Sold - Quoted
* prospectus
;'r.
Vacuum Concrete
Alabama Mills*
Aspinook Corp.*
United Printers .& Pub. Com.
Grinnell Corp.
Upson Corp.*
U. S. Air Conditioning
H. H. Robertson Co.
Oxford Paper Com. & Pfd.
Sunray Oil 4M> Conv. Pfd;
Art Metals Construction
:i
Taca Airways
available
on
request*
>
/'
*[
-
Goodbody l&l Co.
115 Broadway,
New York
Reg. U. B. Patent Office
105 West Adams St., Chicago
Telephone BArclay 7-0100
>.
William B. tJana Company
Teletype NY 1-672
\
Textron Wrnts. & Pfd.
Publishers
REctot 2-9570 to 9576
American Gas & Pow.
♦District Theatres
Iowa Pub. Ser. Com.
New England P. S. Com.
'
*Dumont Electric
Corp.*District Theatres Corp,
*
•vK
Southeastern Corp.
.
'
Prospectus Available
tStatistical Study
or
>
,
1
L
'
"'\V■", Vv
r
*!
•
Common &
Preferred;
*
FIRST COLONY CORPORATION
'
Members
,
k
*
fProspectus Upon Request
Bulletin
52
New
York Security Dealers
Tel. HAnover 2-8080
Association
>
New York S, N. Y.
Wall Street
Thursday, May 16, 1946
Published twice
Prospectus on request
*" "• Vf-
Established
REctor
Bell
1908
Dealers Assn,
Y. Security
2-4500—120 Broadway
v
System Teletype. N. Y. 1-714
Circular upon request
or
ACTIVE MARKETS
y
^Tennessee Prod.
Members N. Y. Security Dealer: Assn.
*Wellman
;
Engineering
and every Monday
\
clearings, state and city news,
Textiles, Inc.
;
Soya Corp. >"■
Harvill Corp.
United Piece Dye
*Descriptive Circulars on request
Y.
Ruff. 6024
Seligman, Lubetkin & Co
1942, at the post office
York, N. Y., under the Act of
3, 1879.
V.;;-25,
United
In
Feb¬
at New
Marcto
States
awl
Possessions, $26.00 per year; in Dominion
of
Canada, $27.50 per year;
South and
Central
America, Spain,
Mexico, and
Cuba,
$29.50
per
year;
Great Britain^
Continental Europe (except Spain), Asia,
and Africa.
$31.00 per year.
;
,
41
Members New York Security Dealers Association
Broad Street, New York 4
f
HAnover 2-2100
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Bank and Quotation
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ruary
Other Publications
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etc.)
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3,
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N.
1
Offices:
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-
"
1
•
Copyright 1946 by William B. Dana
Di-Noc Co.
^Shatterproof Glass
Central Paper
week
(complete statistical issue—.market quo¬
tation
records, j corporation,
banking,
Company
"Doyle Mfg. Com. & Pfd,
*Upson Company
a
Thursday
(general news and advertising issue)
J.K.Rice,Jr.&Co
Members N.
.
William D. RIgga, Business Manager
j, -,
every
-
c
President
William Pana Selbert,
Spec. Part.
Southwest Natural Gas
"
Editor and Publisher
♦Thrifty Drug Stores
x '
Special Letter on Request
j
Herbert D. Selbert,
v
}'.t £•'.<
United Piece Dye Works
f Le Roi Company
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J:hv>4-
Great American Industries
Simplicity Pattern
^Princess Shops
Puget S'nd P. & L. Com.
Standard Gas. Elec.
" ' ">
York 8
23 Park Place, New
Cent. States Elec., Com.
and
COMMERCIAL
The
FINANCIAL CHRONICLE
Exchange and Other Principal Exchanges
Members N. Y. Stock
39 Broadway,
N.Y. 6
Teletype NY
DIgby 4-2370
1-1942
NOTE—On account
In the rate
of the fluctuation*
of exchange, remittances
foi
foreign subscriptions and advertisement*
must be made In New York fundi.
Volume 163
Number 4490
THE COMMERCIAL
"What Is
fSTaxinj For Better living I
!
By RANDOLPH PAUL*
U.*S.
,
,
argument that corporation taxes destroy incentive and risk-taking
does not hold under a system of "loss offsets," whereby Government shares business losses as well as profits. Denies also that
v;
v
:
corporation
taxation works unequitably against lower income
since these do not constitute bulk of stockholders. Opposes
abandoning corporation taxes, but proposes classifying corporations,
groups,
for taxation
purposes, so that those which constitute essentially
partnerships
are
may be distinguished from those in which stockholders
separated from the business.
group.
tion
on
•'
Introduction
/
,
It is
a
great pleasure to speak of tax matters to this distinguished
The very name—Tax Executives Institute—implies a realiza¬
between
our s taxes
and our national
wellbeing. I am
ready to venture that most of you
are
share
to examine
a
growing conviction that
good taxes have
beneficial
a
ef¬
fect upon our
economy, ana that
bad taxes have the reverse effect.
You have accepted the proposition
that taxes are not neutral in their
Impact
ment
upon
and
production, employ¬
national
But
income.
is
year
giving
out where
find
to
and where
we are
heading.
time
us
we
It is giving us time
most grievous tax
our
sins and judge what,we must do
to be saved.
Best of all, it is giv¬
ing
us
will
time to; thinks
let
do:
me
I hope you
little -thinking
a
aloud tonight. \
I have only an ordinary
citizen's
convictions about the tax road to
those
this general proposition falls short
salvation.
of using taxes to make a positive
contribution to living standards.
tions is that the lessons
in
One
of
should
wartime
convic¬
we
not
learned
be
Richard
est
in
the
Yale
com¬
to
and
to
of
active
an
group of
Yale
ed
concern
that
keep'
we
^ale
in
Bank of Toronto
Canadian Bank of Commerce
Dominion Bank
Imperial Bank of Canada
,Royal Bank of Canada
Abitibi Pr. & Paper Com. & Pfd.
Andian National Corp.
Assoc. Tel. & Tel. $6 & 7% Pfd.
Atlas Steel
they can't stay in the business.
Every new method of teaching,
every new scientific idea must be
thoroughly examined and given
an opportunity for development.
Scientific study cannot be other¬
wise than liberal without falling
into a groove which cap easily be
recognized as humdrum and use¬
And so it is fairly easy to
at less.
Bulolo Gold Dredging
;;.® Canadian Pacific Rwy.
or
the
to
are
.
must know which taxes will serve
us
best
particular
ahead.
on
in the years
|
occasions
the
you
when
well
are
we
into
Economic
Executives
dorf-Astoria
Wal¬
Institute,
Hotel,
economic
poten¬
Government's tax¬
New
Background for Tax
York
*
Address
by Senator Taft
Yale Engineering Club, New York
conclude that the leaders * in
(Continued
City, May 10,1946.
Canadian Western Lumber f
Electrolux
f
Hydro-Electric Securities Corp.
International Utilities ' f
•
4
It
is
now
the
Noranda Mines
Pend Oreille Mines
generally
Direct Private Wire Service
Sun Life Assurance
|
neighborhood of $25 billion.
How much of the $25 billion shall
raise in taxes? What kinds of
(Continued
on page
2688)
•
Steep Rock Iron Mines
COAST-TO
-
Teck Hughes Mines
COAST
we
City, May 15, 1946.
;
Paper Cs.
Sherritt Gordon Mines
rather
agreed that the Federal budget for
the long span ahead will be in
the
Jack Waite Mining
^
Minnesota & Ontario
2668)
on page
Players Canadian Corp.
Famous
Policy
the
Tax-wise, at least, this
♦Address by Mr. Paul before the
Tax
and
our
ing and fiscal policies.
I am glad to be talking with
year 1946.
social
tialities of
^
Brown, Company. Com. & Pfd.
Robert A. Taft
perform their high¬ pletely forgotten now. We know forefrontv of
what happens when our economy
est function as
instruments
of
educational
'
<
human welfare, we must explore is running at full blast. We know advance. While there are
larger
the consequences in human terms
frankly, and without prejudice,
Engineering Colleges, we do feel
and specifically, the distinction of a $100 billion budget. At long that we can in some
ways, turn
between good and bad tafces. We last, we are beginning to realize out better engineers than any
If taxes
Mr, Hollo*
previously with Hope &
engi¬
neering that is not difficult. Most
engineers are and must be liberal
as far as engineering is concernea
is
graduates
of
field
In the
associ¬
Co., 639
Bank of Montreal
'•
the
members'
&
Bank of Nova Scotia
so
officers
the
become
Sjpring Street.
but we. can
an
Sheahan, and Robert
Co.
Liberal?"
It is
inspiration
Chronicle)
'
the> Corpora¬
tion to know
there.
edu¬
given
Financial
with R. F. Ruth
South
other'college.; We have done so,
only continue.' - to do
with the advice and guidance
of men like yourselves who are
active in the practice of engineer¬
ing- itself.-A month or more ago when
asked for a title to be put on the
program,
I rashly*; proposed to
discuss the subject, "What Is a
cation
E.
way was
;
It is a pleasure to stop off in New York on my way to the Corpo¬
ration meeting in New Haven and address a group which has such an
<$intense inter¬
and
The
Sheahan have
ated
that
your part of the intimated
relationship
Senator from Ohio
Asserting that "support of every change proposed is not a test of
liberalism, but of radicalism," Senator Taft defines a liberal as one
who believes in freedom and opposes measures which restrict it,
unless such restriction is absolutely necessary to preserve the free-.
dom of others. Holds Communist, CIO and special interest organi¬
sations propagate false liberalism since they advocate a government
in which the few dominate the many. Stresses freedom of thought
and tolerance as an attribute of liberalism, and calls present situa¬
tion alarming because of drift toward totalitarian state.
Cites con¬
tinuation of OPA, compulsory Health and FEPC bills as evidence of
this. Opposes peacetime conscription and say* our foreign policies
are not based on justice.
to
ANGELES, CAL.—William
Hollbway, Robert L. Lindstrom,
E.
Bi
investment, points out that a further problem arises from the uncertainties and inequities in burden of corporation taxes. Contends
!
,
(Special
LOS
;;|v jg g-
.
Adds Four
R. F. Ruth Co.
Liberal?"
a
By HON. ROBERT A. TAFT* ::
^
■
Former Treasury official, in calling attention to difficulty of choosing
between taxes which discourage consumption and taxes which deter
2641
^FINANCIAL CHRONICLE
^
New York
-
Chicago
-
St. Louis
-
Kansas City
-
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Los Angeles
62 WILLIAM ST., N.
Y. 5
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'
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Commonwealth Gas
STRAUSS BROS.
General Crude Oil
Montreal
New York
V
Toronto
Members New York Security Dealers Ass'n
32 Broadway
Board of Trade Bldg.
.
General Instrument
NEW YORK 4
General Panel
DIgby 4-8640
Teletype NY 1-832-834
CHICAGO 4
UTILITIES
Harrison 2075
.
Teletype. CG 129
:
EMPIRE DISTRICT ELECTRIC
E. H. Rollins & Sons
White S Company
Baum, Bernheimer Co.
ST. LOUIS
I*?*
KANSAS CITY
Incorporated
,
Tel. WHitebal!
^oaton
-
Street, New York 5, N. Y.
4-4860
''
Teletype NY
•
Chicago
-
San
LOS ANGELES
7
-
*SCRANT0N ELECTRIC
1-490
.
Philadelphia
& LIGHT
Pledger & Company, Inc.
40 Wall
Sir
PUGET SOUND POWER
Francisco
•"TENNESSEE GAS
;
*
& TRANSMISSION
Airlines9 Inc,,
;
Bought
Lane Cotton Mills Corp.
.
—
Sold
—
Quoted
35 Broad Street, New York 5, N, Y, V
telephone: HAnover 2-6388
5
,
Members'New Orleans Stock Exchange*
Bo. 9-4432 '
.
74
•
Bell
/
Carondelet
American Insulator
"
United Public
.
American Beverage
Electric
&
Gas
Co.
$6
«
Globe-Union Inc.*
^
Suburban Propane Gas Corp.*
/
■
.
Chicago
New York
.
American
|:
'i.
r'^
.
'7V-
■
.
■
•
i
,
•
_
{,
v
Molasses Co. :
Tennessee Gas & Transmission Co.*
Utility
-■-yjjf.
Common
Bought ■— Sold ■— Quoted
*
Bough t—Sold—Quoted
Quotations
Upon
Request \
....
Prospectus on request
FABR&CO.
Preferred
PETER BARKEN
32 Broadway, New York 4, N. Y.
Tel. WHitehaii 4-6430
^
/ Cleveland
4
:Los Angeles
Pfd.
Alexander Smith & Sens Carpet Co. *
Oil Exploration Co.
;
:
,
Private Wires:
:■
Firth Carpet Company *
Common
Preferred & Common
:•
Boston
-
TWX CO 616
'
.
Devonshire St., Boston 9, Mass.
-Richmond 4321- v,;
o
68
.
Master Tire & Rubber
Eliminator/
Randolph 8924
Teletypes:
1
Consolidated
Carbon Monoxide
;
.-..V
-
Tel.~-NY-l-493--Vv:
Getchell Mines
■:|'|||:| Baker Raulang
'•
NY 1-375 & NY 1-2751
BOwling Green 9-7400
Bldg.
;
Trinity Place, New York 6, N. Y.
Telephone;
New Orleans 12, La.
.
La Salle St., Chicago 3
So.
39
;
ESTABLISHED 19X4
New York 4, N. Y.
41 Broad St.
!f
Exchange PI./New;York S ,!
2-4785
TWX NY 1-2733-4-5
40
T. J. FEIBLEMAN & CO.
members New York Stock Exchange
associate members N.Y. Curb
Exchange
,
HAnover
HorRsseSTrqster
BURNHAM&COMPANY'
*Prospectus on Request
•
J. F. Reilly&Co., ik.
Stand. Fruit & S/S Com. & Pfd.
All American Aviation
V
Common & Preferred
Jeff. Lake Sulphur Com. & Pfd.
■v; ContiHeni(dkW^:^lllSSW'l
Bought-—Sold—Quoted
American Bantam Car
TEMPLE COAL PFD.
Chicago and
Southern Airlines9 Inc*
Tele. NY 1-2500
HARRISON & SCHOLTZ
FREDERIC H. HATCH & CO., INC.
Phone HAnover 2-7872 Tele. NY 1-621
MEMBERS N. Y. SECURITY DEALERS ASSOCIATION
63 Wall
Street, New York 5, N. Y.
w
Bell Teletype NY 1-897
120
New
York
New
Established 1888
64 Wall St., New York 5
Members
New
York
York
Stock
Curb Exch.
Exchange
Member
Assoc.
Coffee & Sugar Exchange
WALL
ST.,
NEW YORK
TEL. HANOVER 2-9612
The Americas in
Government Securities and
evCkahgihg World
By JOHN
\
ABBINK*
Commercial Banks
Chairman, National Fpreign Trade Council
-»*
>**
Asserting U. S. influence in Latin America has suffered marked deterioration since war ended, Mr.
Abbink ascribes situation to our ill-conceived and impractical measures to obtain wartime economic,
By FALKNER C. BROACH*
Vice-President, National Bank of Tulsa, Okla,
collaboration. Says Latin America is in an excep tionally favorable trade position, despite inflation, j
Points out improvement in political stability both in Brazil and Argentina, but warns that Col. PeronYj
v- election in face of Washington opposition may put Good Neighbor Policy under severe strain. In Cleye- j
£
^ land address, he criticizes British, socialization
-In
;s
to
years
it
come
in
States
course
face
to
that
ade
Seventy
five
-
age
years
Jyvere
seemed
have
of
only a
us
we
at-the nation¬
American
al level whose
April 23, 1946, followed by an exjcerpt from an address* before the
eventual solu¬
Abbink
John
tion
profound¬
ly affected the
Center, St. Louis, Mo.,
Cleveland
(0.) World Trade Con*1
ference, April 216, 1946.
i
.
in the past quarter "century,
together with progress in com¬
munications, have awakened Us
much more abruptly to the; cur¬ X
rent realization that we are'" sodn i
•
concerned with trouble
the
anywhejre
globe, and .that, establish¬
of
ment
the'kind
•
like to live in -is beset with inter *
Although the title assigned
national
anii the Commercial Banks" what I want to
evasion
the
for
residents
of adjoinihg
states practiced here in the mid¬
dle of the last,century.
The
War
thai
era
saw
heights
al* ;
re-united nation reach
a
mankind
had
yet
never
as
that which
our
nanced
wartime
Circulaf
y-
the
that
debt
as
we
To
my
way
of think¬
ing, these are
import, ant-
Recall
f or,
matters,
Lincoln's
after
whether
we
death
like it or not,
!5
has undergone
ing
crowded with national
was
•
HARDY & HARDY
(Continued
on page
2676)
bankr
sorne
about 28% from the sale of
which, this in-
Sayings institutions;
2. While the Treasury refrained*
almost entirely from direct fi¬
nancing through the banks, it did
look to the banks, and
11 Broadway, New York
Teletype NY 1-960
4, N. Y.
Thermatomic Carbon Co.
vestors.
COMMON STOCK
DIVIDEND
1936
1942
$20.00
1940
25.00
1941
$16.00
1943
16.00
—
20.50
1938
—
10.00
1939
PACIFIC COAST
—
18.00
1945
,.1946 to date
HAWAIIAN SECURITIES
Yiejd
'
***■
**i *
v??ry
h*
4-
'
Qfv'i
11 '
Direct
^ i" y •*1'*^i
Wires
*
>k" * ^
Private
t
,
\
I,:'
-i*"
'J1
?
"
^ NEW YORK STOCK EXCHANGE
]i
* \
HONOLULU STOCK EXCHANGE
14
■
'
,
'
before
HONOLULU
.
Teletypes:
5% Non Cumulative Preferred Stock ($50 Par)
194S
'
on
pfd.
$8.80
earned
on
pfd.
$5.85
1943
"
earned'
1944
-
earned
on
pfd
$8.56
Lit ting
';/■
of
w.c.
.
w.c.
w.c.
WarTime Restrictions
ratio 3.1 S
ratio 2.67
ratio 2.21
Most
to
1
to
1'
Constructive
W''
'f
i
" *
'
• v
Circular
/"V
[
!'}
'
\\u \
Butterick mailed
on
».,«•
upon
X-
\
Philadelphia Stock Exchange
WHITEHALL 3-0550
.
.
.
Tele. NY 1-2178
Harrisbyrg-Pittsburgh-Syracuse-Miami Beach ' "
H. D. KNOX & CO.
request
Bought^-Sold—Quoted
.
.
.
Brokers
,
In
11
Broadway, N. Y. 4
27 State St.,
| 1 Montgomery St., Jersey City, N. J.
I
42 Broadway, New York, N. Y.
New York 5,
Telephone 1
WHitehall 4-2422
,
113
Tele. BS 169 '
Established
& Dealers
Boston 9
Tel. Capitol 8950
DIgby 4-1388
Tele. NY 1-86
1926
Investment- Securities
62 William St.
George A. Rogers & Co., Inc.
52 WALL ST., NEW YORK 5. N.'Y.
on
MAHPt & HULSEBOSCH
S. B. Penick
Claybaugh fit Co.
Members
1
*Circular
Tel.
White Laboratories
Blair F.
1_
Ltd*
i
Inkograph
'.V;t4 or»
/«
*Can. Western Lumber Co.,
Cespedes Sugar
request
Nazareth Cement
Clayton Silver Mines
etc.
Boorum & Pease
Price: 3614 —Only 3 times 1915 earnings
j
Hotel
Rhodes
Americas! Felt Co,
Hudson River Day Line
Bonds Stocks
H.
V.T.C.
;|ntl. Accountants 5/68
Limestone Products 3 Yt
1
to
Steep Rock Iron Mines, Ltd.
Abendroth Bros. 8/35
Works
Washington Properties
M.
>1
City,
American Vitrified Products
NY 1-375 & NY 1-2751
W.
Cedar
Commodore
The Butterick Company, Inc.
Bankers
Victoria Gypsum
Trinity Place, New York 6, N. Y.
BOwling Green 9-7400
Broach
Mr.
the» Oklahoma
Branch
N.Y^
.Teletype;;
NY 1-2613
.
Office/
,
Hudson St., Jersey' City, N.:
J. ; j.
Philippine Mining Stocks
Atok
SEMINOLE OIL & GAS CORP.
W-
'
^
CO., Inc.
BROADWAY, NEW YORK
1
•
Sold
—
:;X Quotaiioni and information
Quoted
R. C. ILSLEY &CO.
Member of National Association
Members N. Y. Security Dealers Ass'n
111
—
of Securities Dealers, Inc.
6, N. Y.
NY 1-1026
Mindanao Mother Lode
Utah Southern Oil
Super-Cold Corp.
■
BArclay 7-0570
Big Wedge Gold
Equity Oil
Bought
^Circular pn request
•Furnished. on Request
john j. o'kane jr. & co.
JAMES M. TOOLAN & CO.
67
Wall Street, New
York 5
Established
Members N. Y.
<
64
Wall
Street, New York 5
HAnover 2-1140
"
Mining
Benguet Cons, Mines
*Kinney Coastal Oil
Common Stock
PROSPECTUS ON REQUEST
F. H. HOLLER &
Balatoc
Cxpresso Aerep
Linn Coach & Truck
Producing Company 'r<
•
Tennesson Products
1914
Telephone:
|LOS ANGELES
by
2684)
request
ESTABLISHED
74
on page
address
Convention,
Oklahoma
Okla., May 10, 1946.
per annum
7%
HoeRsseSTrsster
Telephone BArclay 7-4300
*
on
.
LOS ANGELES STOCK EXCHANGE
.
WALL STREET, NEW YORK
SAN FRANCISCO
$4.00
*An
Richmond
Co.
SAN FRANCISCO STOCK EXCHANGE
k
over
Circular
.4 members \4i4**
f.
—
of $16
~*
'
Dean Witter
(Continued
16.00
at current rate
were
16.00
1944
->$12.30
Only in the first two drives
commercial banks allowed
almost unlimited participation/
a.
t
RECORD
1937
«r'i
rightfully
I think, to absorb the secur¬
ities hot taken by non-bank in¬
so,
WHltehall 3-4490
•
se¬
curities to the banks, including
.
and the manner in
1
was
a.
In aggregate, about* 40%
of our expenditures were met
by taxes, 32% by borrowing,
from non-bank investors, and
F. C. Broach
eyoluif not
revolutionary,
confusion and sordid maneuver¬ tippary,
as
a
result, of ; the
ing, that bitterness and recrimina¬ changes
J
tion abounded, that new leaders enormous, increase in pur, debt
request
on
period
our
did.
Socially, the atmos¬
phere is almost identical.
in¬
,
in
crease
„
cal- borders.
Although our announced pol¬
to finance the cost of the
war with minimum reliance on
commercial bank credit, it was
necessary—as it always is in time
of war—^to call upon the banking
system to supply a substantial1
portion of the credit used 1 to;
prosecute the war.
i
1.
icy
f ithe
having
im¬
accomplished in
this country, and in all of its
phases, spiritual as welljfa^ ecbnbmic; it differs only because its
ramification? extend to fhe* end bf
the earth, not alone to our physi¬
Moreover,
-
can envisage still more evolu¬
tionary, changes in banking.
billion and in
same
debt
I
of
$ 2 75
over
witnessed. The present world job
of rehabilitation is much the
debt
financed.
faced with the prob¬
management, —a
problem in the solution of which
cre¬
a
are
of
lem
n
nation¬
ated
still
we
problems
i
was
crease
of
some
having
Ciyil
do is to discuss with ybu
mo¬
involved
<|
.
followed the
few
a
ments
mediate forebears
m.
talk is "Government Securities '
my
difficulties, from which
we have hitherto attempted to in¬
sulate
overselves
by the same
in character
Sport Products, Inc.
currency
commercial bank loans.
we'd
world
of
and bank deposits, argues that, despite
of excess Treasury bal¬
ances, and despite pressure bf banks and other investment institu*
tions for higher interest yields, the wartime pattern of interest
rates will be generally maintained without affecting materially
present volume of bank deposits. Sees probable shifting of deposits
from country banks to Reserve Cities without relieving banking system from continued dependence on holdings of Federal debt for
earnings./ v Contends Federal Reserve and Treasury will follow^
orthodox policy in debt management, but predicts some increase in
circulating
on
reductions in national debt through use
;
wars
on
/ *An address by Mr. Abbink be¬
fore the St; Louis'Regional Inter?
emergency
^
i
\
:s/
after analyzing the war financing policy and its effects
Mr. Broach,
-
neglected because ,it was contro¬
versial, and little understood^ Two
•*-
.
con¬
fronted with
an
would
We know now, in retrospect,
that the dssu^lof ^a^ry;an: this
country
was^ .but '-j the 'political
symbol of sectional economic mal¬
adjustment', expediently and long
-overtones.
•
which
short while ago...
War
days, and with
% analogous
-
ill-prepared to
whose \ irresistible
and
sheer fantasy to most
existed
Civil
we
impact may result in home-front
developments over the next dec¬
pat¬
tern
which
that:
problems
reluctant and
are
crisis compar¬
in
of world history; Today'we
overseas
•resolve,
a
able
and outlines formula for world stability*
program
well**
may
through which we are now living
be pointed out that the, period
involved the people of the United
in
Thursday, May 16, 1946
CHRONICLE
THE COMMERCIAL & FINANCIAL
2642*3.
Telephone
HAnover
2-9335
Teletype NY 1-2630
1922
Security Dealers Ass'n
42 Broadway, New York
DIgby 4-6329
;
Teletype NY 1-1525
THE COMMERCIAL & FINANCIAL
163|-Slumber 4490
IBA's Economic Program
As -the prerequisite of
sound
a
economy
Anglo-American Cooperation
lp||A;::;Bulwark for ;Peace
-
.
advocates* balancing the budget, reform-
President Garland
ing Federal debt management, and developing
a n Intelligent tax program to replace the existing
proposed control by SEC of "insiders" underwriting participation. Gen¬
eral Counsel Hanson advocates modification of Federal securities regulation.
j
'hodge-podge."
Investment
lational
He
dealers
of
New
York
have
asked
been
to
back
Former Ambassador to U. S.
5
rates
est
securi¬
Government
on
1
ties, a determined effort to put the
rpaximum of Government securi¬
ties into the hands of non-banking
investors,, mid leeway for. the na¬
tion's industrial machinery to re¬
stock retail shelves
as
possible. '
"
%
quickly
V
,
security issues to so-called "in¬
siders," Mr. Garland emphasized
his conviction that the; problem
a
massive weight placed solidly behind the United Nations" for
of attaining a peaceful and ordered world.
Holds continued
|
a
means
<
f Referring to the'proposed SEC
is
;
I
f Anglo-American cooperation offers the greatest bulwark for peace.
S
-i I have been asked to
,
..
•
this
Garland
in
should
John C. Maxwell
exercised
be
in
order,
pply specifically' to the investment banking, business/'
Charles S. Garland,' President of the Investment Bankers Asociation of America, outlined the objectives for which the organizat¬
ion asks "grass roots" support atfdinner meeting May 13 spon-'
A balanced Federal budget is
ored
by the New York members
Mr. Garland
been here, we
ompanied
by
Hanson,
Murray
counsel
.eneral
of
ae-
was
Associa-
the
Mr. Garland said that the IBA
is working with Government' com¬
mittees in the formulation of
would
require^ long period of
high taxes, be politically unpopu¬
Bank for Reconstruction and De¬
they may be, tonight.
May I go on to let
secret?
indeed
made
We
have also visited
every
state
in
who discussed Federal regu-
tion
the
of
securities
which
eeting
business,
the
held at
was
nion Club.
"Five projects for concentrated
Itention
set
were
rown
a
forth
Mr.
by
partner in the
firm of Alex,
Included were:
& Sons.
L* Management of the Govern,*ment debt and its'relation to
*the forces of inflation.
2.'The Federal budget ' and tax
{
Lord Halifax
securities business,
the
is
one
of
the
and
serious
most
said.
He
laws to protect the
tered"
complex problems, the investment
man
welcome such
vidual investor.
criticized the low
indi¬
3. Encouragement of small
We
are scarce.
-
~
tion. $
•
...
goodbye to
Out-of-state visitors
369,000 in,the first
as
world,
find
a
met with such
I met with here or had
BOjfine a time as yoti have given
all
me.
.
^"■
5 v
;
/■■'o;Anxious Days
After
■
not have
We passed through
(Continued on page 2681)
all,
might
it
been like that.
-
.
,
personnel for
new
A Growth
'
m
J'%■ Chrysler;, dealers' in U.
with repair, tools.
S.
\
increase over last year of
NEW YORK STOCK
MEMBERS
SAN
FRANCISCO
SAN
NEW YORK
STOCK
EXCHANGE
EXCHANGE
.
...LOS
ANGELES
STOCK
Mass. Utilities Associates
National Shawmut Bank
SPOKANE
*
Our
•
Economjr-B^lco Valve Co.,
Serves
the
:
automotive,
New York,
A. S.
Ralston Steel Car
Saco Lowell
Tybor Stores
All others traded
direct private
Common and
craft, chemical, agricultural,
oil, paint, and hardware in-
Philadelphia, Boston and Hartford.
Preferred
89
Analysis
on
request
Devonshire St., Boston
120
Broadway, New York
COrtlandt 7-9400
Information on request
1-1950-2
TWX-NY
and NY
Donald Young & Co.
INCORPORATED
TWX-BS 200-
LAfayette 3300
dustries.
*.'•
telephones connect
Campbell Co., Inc.
;
air-
own
§
Nicholson File
Prospectus upon request.
Rieke M e ta 1 P ro tlu c t s Co.
Light
N.E.P.A. Preferred
Collyer Insulated Wire
Dewey & Almy Chem.
Dwight Manufacturing
E. U. A. Com. & Conv.
First Boston Corp.
EXCHANGE
SEATTLE
FRANCISCO
Mass. Power &
Brown Co.
NEW YORK CURB EXCHANGE
Its Subsidiaries Are:
•Precision Manufacturing Co.
Johnson Automatic
Boston Wharf
•Monyoe Steel Casting Co.
f •
Heywood Wakefield Com
Hey wood Wakefield Pfd.
Spinning
Berkshire Fine
•';; •
_
Kaiser s. Co.
alt
serves
•
First National Bank
Arlington Mills
^ ^
Bangor Hydro-Electric
*Bates Mfg.
■■
'*
*
an
r;-vVH
"
Boston Woven Hose
MILLER MFG. CO.
Established 1914,
fc Si «■'
toll load shows
were
times the 1938-40
;
per'}
STOCKS
PRIMARY TRADING MARKETS
average.
'
Company^
NEW ENGLAND
California entering by automobile
to
quarterl of 1946—over
twice the national average. ?
i
to
§
OVERING THE COAST
West Coast telephone
1
kindness
say
new
certain
bus-
the investment business.
.
cannot
strange
was
the first time
for
a
right to expect.
However, he said,
Iness enterprises.
5.' Training
.
hardly
I
great deal of difficult work to* do.
And now that my time is up, I can
tell you quite truthfully that no
small boy who ever went to school
■
ternational bank and mone¬
'
where
♦Address by Lord Halifax over
policy of the Treas¬ in the,interest of sensible business
the
network
of
the
Columbia
ury, terming it a "source of real
practices, both the statutes and
danger" because it permits the
Broadcasting
System, May
11,
administrative regulations.and in¬ 1946.':: ■
'
expansion of credit and purchas¬
terpretations
require
modifica¬
ing power at a time when goods
tary funds.
•
had
we
a
interest rate
4. World finance and participation of the U. S. in the in-r
-
as
I only knew that I was
entering
took us, we.found a warmth and a
said the IBA
Mr. Han¬
approved "sound¬
ly conceived and fairly adminis¬
son
Management of the Federal debt
Am¬
like you.
said
podge" of Federal taxes,
into a
as
-program.
u
"
He
■*
*
xarland, who is
altimore, Md.,
lar and
here
if you were going to like me, or,
for that matter, if I was going to
the
Union;
and
require political courage.
velopment in .operation as speed¬
that the IBA hoped to
that, as Brit¬
ily as possible. He urged approval ish Ambassadors
ohn C. Maxwell, Chairman of join other organizations in pre¬
go, is a record—
which cannot well be beaten un¬
he New York group of the IBA paring "an intelligent, equitable by Congress of the British loan.
til you add to the number of your
nd a partner of Tucker, Anthony and comprehensive" tax program
i Regarding Federal regulation of states. And wherever our travels
Co., New York, presided at the to replace the present "hodge¬
on,
came
January 1941, I felt
very much as I did when, as a
very small boy, I went to school
for the first time. I didn't know
good
friends.
When I
•
you
bassador in
many
very
plans to aid in the financing of
smalt business. It is also, he said,
cooperating with the Government
on plans to put the International
prerequisite to a sound economy,
Mr. Garland said, adding that it
have
I
and
have
■
>f the IBA.
that
Halifax
Lady
imposed way by the NASD rather
than by the SEC.
have met in all the states
we
as we would wish to
do, but that, they will understand
and ^forgive.
So I would like to
begin by sending a special mes¬
sage of gratitude and affection to
them all from us both, wherever
years
self-
a
American friends
grateful to
my
separately,^
oppor¬
tunity. During
the nearly five
and- a
half
He stated
control, if at .all
few words to
a
,th0se who®have given me those
and; ethics, and hence : should not
be, treated by statute, or by. com-?
mission administration.
say
before I sail for England on Monday night and I am most
matter of business principle
that
1
stay in
years
I
as
*''..
* '
rule relating to allotments of new
Charles S.
'■* .•
j Retiring
vocated stabilization of the inter¬
seeking tax reforms, improved government debt
management and dealing with other "aspects of national affairs which
program
1
'
Ambassador recounts the1 anxious days during his live
United States and problems arising from need of
Anglo-American cooperation in bringing about a victorious end of
war.
Cautions we are still living in an uncomfortable world and
are still beset by doubts whether victory in reality is won, but points
to the vast joint power of British Empire and U. S. when used "as
J To help curb inflation, he * ad¬
a
EARL OF HALIFAX*
By THE
opposes
\/-{.'i
) Member of National Association :.ii
<of Securities Dealers, Inc. '■
^}
40 Exchange Place, "N. Y, 5, N. Y.
1-2837-9
New York Hanseatic Corporation
120
BROADWAY, NEW YORK S, N. Y.
Telephone: BArclay 7-5660
Teletype: NY 1-584
For Brokers and Dealers Only—
National Chemical & Mfg. Co.
Circulars ^Available
S. Weinberg & Co.
Members N. Y. Security Dealers Ass'n
€0 Wall Street
A
!
.
Taylor-Wharton'Iron & Steel Co.
Mohawk Rubber
Whitehall 3-7830
Teletype
NY
1-2763
V
fe
moderately priced dividend paying security.
Manufactures
in
for
all
a
nationally
S
Data
Hartford Empire Company
Render
the
advertised
"Luminall"
paints handled by 3500 distributors.
Telephone
New York 6
Bell
'
on
:
;v ■"'
••
v:'
Request
brokerage service
Unlisted
Banks
and
J. W. Gould &> Co.
Securities
Dealers.
Teletype:
Nil1"1287
1-1288
■■
\
Members N.
120
Est. 1926
Y.
-
»
-ri'
Security Dealers Ass'n
BROADWAY, NEW YORK 5
S:'/Telephone:
RE. 2-8700
1ZO
Broadway^ New York 5
Telephone: COrtlandt 7-4550
Teletype: NY 1-2312
N. Y. Curb Ticker
Service
'
ticker
| Marx & Co. Forming
service
Curb
further
expanded by installations in Pas¬
California; Denver, Colo¬
Youngstown and' Dayton,
adena,
rado;
Ohio; Charlotte, North Carolina;
Roanoke, Virginia; and Plainfield,
New Jersey, the exchange has an¬
The Curb ticker system
nounced.
carries security
now
cities located
quotations to
22 states and
in
Marx
Exchange
been
has
&
will
Co.
formed
be
shortly with offices at 37 Wall
Street, New York City, to engage
in
the
business.
securities
Part¬
will be Otto Marx, Jr., Ed¬
ners
win H.
Koehler, and Raymond de
Clairville, member
Stock
York
Clairville is
Crary
&
Mr.
de
partner in Tuller,
a
Co.,
Monumental
Life
will
branch
staffed
be
has
who
Secretary Vinson
ment
men
the firm
with
been
(Special to The Financial
with
Inc.,
In the
Winn & Lovett Grocery
Dunn
300
past he
I
and
was
Prior
if
even
Chronicle)
inflation.
I
am
™I bankers BOND 1*
&BOYCE
what, in
Com¬
was
Teletype BA 393
New York Telephone Rector
my
■■s.
United
'
j
dom
Racing
Eastern
A d
&
Standard Stoker
Assoc.
Memos
Suffolk, Downs, Mass.
i&'jifi ' -r'-
it
V'V'-7
••iV'f
.J.
on
■
Members New York,
Jockey Club
Company
ESTABLISHED 1899
.
Walnut Street, Philadelphia 2
Wire
SU
•'
Senator Ball, in
Dealer Inquiries invited
TRADING MARKETS
Bought-—Sold
i.t\
*i; f\ Vy:
Empire Steel Corp.
'j.§ 0\
\
'${
■
UTAH MINING
du
.y,,
Pont, Homsey Co.
31
MILK
STREET
solutions
H. M.
Teletype BS 424
Telephone CAnal 6-81,00 ^
Stock Exchange Bldg. Phila. 2
Phone Rittenhouse 3717
ficult
W
Salt Lake City, Utah
Phone 5-6172
.
Boston Edison
Southern
COMMON STOCK
Textile Securities
Building
Holllngsworth & Whitney
Megowan-Educator Food Co.
Dividends
Paid
50
New
47
of
years.
England Lime
Memo
on
task
i
:*•- f
\
•«
-v
'
•
75 Federal
Street, Boston 10
Private New York Telephone
REctor 2-5035
Phone
COrtlandt
,7 7
to
V":
(Established
v-
r
to
C.
Teletype spbg 17
L. D. 51
UTICA, N.Y.
Oneida Ltd/
Wiley Bros.
,
7.7
Preferreds
and
EQUITABLE
DES
Phone 4-7159
IOWA
Bell Tele. DM 184
of
my
We
Ball be¬
May
1
1946.
funda¬
a
I could
pending in Congress.
speak of
democracy.
pure
Bankers Asso¬
City,
yardstick which
our
Government as
Actually it is not a
democracy, where the peo¬
10, ple decide issues directly and the
(Continued on page 2670)
,
STATE AND MUNICIPAL BONDS
Preferred
CORPORATE
Mills, Inc.
BONDS
LOCAL STOCKS
MOHAWK VALLEY
-
Bonds
INVESTING COMPANY
Nashville, Tennessee
The
Robinson-Humphrey Company
Established
INC.
238 Genesee
St., Utica 2, N. Y.
Tel. 4-3195-6-7
a
Tele. UT 16
RHODES-HAVERTY
BLDG.
Teletype AT 288
at
own
/>.,'•
Common
9,
out
con¬
mine
INQUIRIES INVITED
BUILDING
MOINES
grew
and
of
apply to the scores of perplexing
issues
of the New Jersey
Utica & Mohawk
Cotton
V "r
Stocks
1
J Common
mental
a
Atlantic
obscured
effort
7
Sioux City Gas & Electric Co.
Preferred
v
INCORPORATED
United Light & Railways Co.
political liberalism and
discuss the application of
principles to some of our
fore the 42nd Annual • Convention
ciation,
NASHVILLE
Light Co.
become
have
this afternoon urgent need to develop
define
*An address by Senator
1892)
INCORPORATED
Preferred
H. Ball
definition
then to
^r>
SPARTANBURG, S
7
7-1202
WHEELOCK & CUMMINS
Iowa Power &
Jos.
Senator
fused. is' This
,
DES MOINES
in
It is my purpose
1 (■% A
States is to meet
people of America understand and
agree on a few fundamental po¬
litical principles which currently
A. M. LAW & COMPANY
PH 30
N. Y. C.
■
existing
liberal
St., Philadelphia 3
Pennypacker 8200
Private
CoJ
'. •''
u-
•
1606 Walnut
If the United
realistically the vast issues we
face, it is imperative that the
ciples; ahdla-?
Properties
■•
Submarine Signal
Dayton Haigney & Company
specific issues.
com¬
confusion
political left, even though we
differ on their application to
bels.
r'
~
may
is
political prin¬
last
,
BOENNING &
the
plicated by
AND <
request
^
group of Americans who belong
neither to the political right nor
in
the job. Un¬
the
Beneficiary
Boom
leg-
devote
further
-' /*7.
•
myself, ! do believe that the prin¬
ciples ;of i liberalism as I define
them are those, held by that large
ashington
who
.o
Grinnell Corp.
■
devotion to individual lib-
as
major international and domestic
issues.
While I speak only for
fortunately,
TRADING MARKETS
-
^
®
to
task,
for
our
——
defining Liberalism
their full time
Tele. PH 73
SPARTANBURG
Bangor.Hydro Electric
14,
Currency, May
Senator from Minnesota
States
con¬
a
islators
Stock Exchange Building
Teletype SU 67.
and
1946.
fusing and dif¬
even
BROKERS
Byllesby & Company
Banking
prob¬
e s e
lems is
Members Salt Lake Stock Exchange
PHILADELPHIA OFFICE
HANcock 8200
1898
WHCHILD^INC,
common
■
BOSTON 9, MASS.
N. Y.
1 Warner Co.
before
today a tremendous array of complex
international and domestic issues. Finding the proper and democratic
t h
Established
Sterling Motor Truck
^Statement by Secretary Vinson
the House Commitee on
been
The United States is facing
STOCKS
Vinco Corp.
2678)
Claims that the goal in economic field
equal individual opportunity. Decries privileges
given labor unions, and advocates wider education, research and
housing aid.
Pittsburgh Railways
Inquiries invited
on pgge
should be toward
BROKERS and DEALERS
com.
country cannot pros-
(Continued
toward Authoritarianism.
com.
Botany Worsted Mills pfd. & A
This
earth.
have
erty, scores prevalent confusion of Liberalism with Radicalism.
Holds Liberalism does not favor class interests or adoption of radi¬
cal changes, and criticises Administration's policies as tending
for
Central Iron & Steel
a
-
464
System between
New
Rockingham, N. H.
people.
sacrifices
By IION. JOSEPH II. BALL*
l, Utah
TELETYPE
The world cannot have
stable, enduring peace while dev¬
astation
and
hunger stalk the
largely mean¬
ingless unless
power to achieve
United
Philadelphia, New York and Los Angeles
Hampshire
Jockey Olub
our
:
160 Sj Main Street
Salt Lake City
BELL SYSTEM
linked.
Liberalism Abroad and at Home
.
Private
do all in
we
•
Los Angeles
you
new
our
have
Secretary Vinson
& COMPANY
Pittsburgh, Pa.
'
Hagerstown, Md.
N. Y. Telephone—WHitehall 3-7253
-i?1' 'rA.
a
borne will
EDWARD L. BURTON
Philadelphia and
New York
Ocean Side, N. J.
i
1529
Light
live together in peace and
prosperity,
^
As you are well aware, world
peace and prosperity are inter¬
esponsibility
to
Request
Los Angeles Stock Exchanges
0
n
world in which countries work
and
Congress
r
Amalgamated Sugar
BUCKLEY BROTHERS
-
and
—
—a
the
inistra-
m
tion
Utah-Idaho Sugar
Corporation
the
in
we
they
Common
and
end of the war
The
United Printers & Publishers
and will not affect
lasting peace and sound prosperity. mui~ is the one reward of vic¬
This
tory that our people and the peo¬
ple of all the United Nations ask
world.
With
in
PHILADELPHIA
Eastern
the
to
to
i
Utah Power &
'
financial help.
our
us
King-®
America
SALT LAKE CITY
BOSTON
will need
burden to
no
means
have
2-3327
a
1
Walter.
Bell Tele. LS 186
loan, it will constitute
on
glad to appear before this Committee and to explaiit
judgment, the proposed Financial Agreement with the
LOUISVILLE 2, KENTUCKY
Long Distance 238-9
paid
,
Floor, Kentucky Home Life Bldg.
1st
6 S. CALVERT ST., BALTIMORE 2
Bell
partment for Edgerton, Riley
Incorporated
Members New York & Baltimore Stock
Exchanges and other leading exchanges
interest is
very
with Longan,
he
as
though admitting other countries
charge of the municipal bond de¬
STEIN BROS.
no
and Bayly Bro¬
thereto
well
as
war
good U. S. investment.
Holds British will cooperate in attaining
objects of loan and contends the credit will not constitute precedent,
Montgomery ; St.
& Philleo
thers.
Noxzema Chemical
.
of
causes
Asserts loan will constitute
California
First
agree*
Holds it removes
aiding in maintaining and ex¬
our exports.
-asserts that
■
Starkey has become affili¬
L.
pany,
Louisville Gas Pref.
Co.
Staff
approval of Anglo-American financial
Sees seriously restricted U. S. foreign trade
collapse of Bretton Woods if agreement is not ratified, and
panding
in
urges
Li
Treasury;^
force for promoting world peace.
a
as
economic
Jr.,
SAN FRANCISCO, CAL.—War¬
ated
Merchants Distilling Co.
Ins.
by
headed by Lucius F. Hallett,
ren
of Baltimore
Secretary of the
-
Girdler Corporation
T
By HON. FRED M. VINSON*
The new
and New York Ayenue.
v
Davis Coal & Coke
;
will
shortly open an office in the
Washington Building, 15th Street
s
Drug
Common ,
The
—
First California Company
American Air Filter
Bayway Terminal
Emerson
C.
D.
Corporation
Adds Starkey to
American Turf Ass'n
'■
Boston
thereto flew York for some 10 or 15 years.
and prior
LOUISVILLE
BALTIMORE
V'
First
New formerly in the New York office
the
of
Exchange.
$ WASHINGTON,
Thursday, May 16, 1946
The British Financial Agreement is
Essential to World Peace
partner in Gwynne Bros.
was a
the District of Columbia.
.
First Boston
Opening
In ft. Y,-Exchange Firm Washington Branch
|
Expanded
The New York
82
■T*
THE COMMERCIAL & FINANCIAL CHRONICLE
2644
1894
ATLANTA
I,
GEORGIA
Long Distance 108
Volume 163' Number 4490
THE COMMERCIAL & FINANCIAL CHRONICLE
N.Y. Federal Reseive Sees Post-
"Toppers" to Hold
Spring Outing
Annual
Wai
Adjustments Unbalanced
The
v
of
Toppers,
municipal
organization
an
bond
traders,
are
holding their annual Spring out¬
ing at the Westchester Country
Club, Rye, N. Y., on Tuesday,
May 21.
Many municipal traders
out
from
of
will
town
attend.
John V.
Hollan, of Barr Brothers
& Co., said that returns to date
indicate an attendance exceeding
200,
including many out-of-town
traders.
"v.
-
San Francisco Traders
To Hold
SAN
Spring Party
FRANCISCO, CAL.—The
Francisco
San
hold
will
Traders
their Spring party at the Orinda
Club
Country
Friday,
on
May
24th.;si®
SCHENLEY DISTILLERS CORPORATION
NOTE—-From time to time, in this space,
there will
appear an advertisement which
hope will be of interest to our fellow
Americans. This is number 126 of a series.'
we
vSCHENLEY DISTILLERS CORP.
Stickers
By MARK MERIT
Another synthetic, ''dry" campaign
as
"Liquor Ad Crusade"
.
described
is
currently in
harass
It is done to
vogue.
and
newspaper
,,
.
magazine
publishers. The publisher receives,
thru the mail, an
envelope con¬
taining newspaper clippings of
beer
and
liquor,' advertisements
-
with colorful stickers
pasted across
them, reading: "Liquor ads must
go
I don't like these in my
.
.
,
paper." The stickers
are printed in
rolls, by the million, and sold in
quantity to folk who presumably
object to the existence of a legal,
licensed
alcoholic
beverage
dustry.
in¬
'
:
This has elicited comment from
a
number of newspapers. We quote
from an editorial in the Madison,
Wisconsin, Capitol Times of Feb¬
26th, 1946:
ruary
uIf
we are pleased to announce
we are now to start censor*
,
ing our advertising columns, by
barring liquor advertisements,
the formation of
lengths:'shall'-'we'-go?
What about cigarettes! Beer ad*
Young, Aal a Golkin
vertising, too? What about the
movies? What about books? One
We Are pleased to announce that
of our correspondents, in the
..'Voice of the People * today,
S would even bar card
playing.
to transact a general investment
'*<
-V'''**4, {'Ft* '
i
./I'v'if.
securities business
OLIVER J. TROSTER
Shall
Colonel, General Staff Corpa
WITH
has returned from
»V
1
•'*
l
'
r'
r'
-
his activities
fcjfj
as a
i
general partner
throw out
we
column?",
.<>
J. v.
jf
-
-tr
'K'.; r- '"Tj4,-- i
telephone ba 7-8400
John
v.
teletype n
go
C. Jerome Aal
tioch
who
lived
in
Troster, Currie & Summers
Saul Golkin
Theodore R. Young
Trinity Place
New York 6, N. Y.
an evil delight in
abusing it.
If you shout, * Would there were
no
wine f you
should add,
%Would there
bell
the
system
installation
of
a
i
were no
EFFECTIVE MAY 15,1946
NUMBER
WILL
BE
of
cause
CHANGED TO
HANOVER 2-4000
CO
'ij/
est.
1032
Francisco 4
this .;."i
In
v;.' V' :-. ":
And that's
in
just about what the
modern
language—1500
later.
years
NEW
YORK
STOCK
EXCHANGE
FREE
—
Send
postcard
a
MERIT
ONE WALL STREET, NEW YORK
5, N. Y.
OF
CORP.,
Dept.
ISA,
N,
and
N.
Telephone EXbrook 7484
light, be*
INVESTMENT BANKERS
MEMBERS
Russ Building, San
no
might destroy every*
■j;' thing.77
said
G. H. Walker & Co.
8
be*
iron,
Madison, Wisconsin, CapitolTimes
Securities for Retail Distribution
DENAULT
were
informers.7
manner you
Trading Department Wirei HAnover 2-4019
no
night, because of thieves;
would there
OUR TELEPHONE
were
of murderers; would there
cause
teletypewriter
Interested in Buying Block Offerings of
~ '
"IVo, it is not the wine, but the
intemperance of those Who find
providence. R. I.
announce
the
to
able excesses," he said in part:
:
we
Fourth
now) hue and cry on the
part of reformers against "deplor¬
may 15. 1946
74
the
answer
then (as
-
:
Security Dealers Ass'n
back to St.
way
Chrysostom, Bishop of An-
Century A.D. In
Member New York
bridge
our
-
portunity to
115 Broadway, New York
1
4
AT
Which gives us still another
op¬
duty and is resuming
war
OFFICES
Y.
page
I,
Y.,
SCHENLEY
350
ycu
to
MARf-
DISTILLERS
Fifth
Avenue,
will receive a 96*
book containing illustrated reprints of
earlier
articles.
.:
r
fe THE COMMERCIAL & FINANCIAL1;CHRONICLE
2646
Thursday, May ♦ 16, 1946
;;
Federal
Trading Markets
Recommendations and Literature
Mills
Allied Paper
Atlas Brewing Co.
it
-
: <
Atlas Press Co. '
to send
:
Established
3lr
Income
Member, National
Association
of .Securities Dealers
'•>'
and review cohtain-
of. comment
Wholesale Distributors
I Middle West
^
-.'/v."
Pacific Coast
capital
MARKET
^
DISTRIBUTidN
LOS ANGELES 14
650 S. Spring St
Michigan 4181
CG 99
LA
•
Co.;
Pitt
Also available is a recent mem¬
Company;
255...;.::
Ray-O-Vac Company; Fort
Bridge Works and Welch
Dayion'
Co^r
Iroit
Malleable
Study of outlook and speculative
possibilities for appreciation for
Grape Juice Co.^-Strauss Bros,, 32
Broadway, New York 4, N. Y,
company—Ward & Co., 120
Stocks-^ Broadway, New York 5, N. Y. Also
available are late memoranda on:
analysis of 19'
this
New York City Bank
Consolidated Gas
'
Utilities
Cohiparisoh
stocks
Corp.
'
Broadway,>N6W York 5, N.
The-Muter-Co.
Circular
on
j
Y.
Security and Industry Survey-
Analytical guide for investors
Request
Purolator.
5/N.Y.
Stock Exchanges
Chicago Board of Trade
Members Principal
So. LA SALLE
231
1
York Office
New
Dried Industrial Corporation
—
—
-
Exchange
Place, New York 5^ N, Y..
JI^Fi Reilly & Co.* 40
issue
Torriga,
Bank
Wall St.
Street", discussing the outlook for
the
Mich.
Afi"-:
■
•
■
*Woodall
*
Industries,
Camden
York
P|4v
Inc.,
Forge Co., Common
:
•
Salle
Request, ;
yml H. Davis 6c Co.
'.V
VEstablished 1916
■
Members Principal Stock
Exchanges
Chicago Board of Ttade
Arden Farms Company—Sjpecial
report—Maxwell, Marshall' 6? Col,
t
Teletype CG405
Street,
Spring
South
647
Axelson
Engineers
Los
Manufacturing Co.
Report—lierzog &' Col,
7, N. Y.
TA
Butterick Company, Inc.,—Cir¬
ADVERTISING
v';
Branches
11s
Albert Frank * Gueftther Law
'
:■
Incorporated
•
131 Cedar Street
New York 6,
N. Y.
'[i Telephone COrtlandt 7-5060
Boston
:
.
emphasizing the strong posi¬
tion of the preferred stock which
sells at a price equivalent to only
three times 1945 earnings per pre¬
cular
ferred share; the net
Plans Prepared—Conference Invited-
:
Chicago Philadelphia San Francisco
Treat & Co., ? 40
Wall Street. New York 5, N. Y.
y.,
- '
■
•
<•■ ■■
-
■ ■'
' J
'
Fred.W. FairmanCo.L
JMHMHMSINCE 1908OMBBHB|
available
on
.
v.
Members
*
Chicago Stock Exchange
,
Signal "land
Engineering WTorks. [
current assets
position of the company shows a
ratio of 3.15 to 1—lifting of war¬
time restrictions such as' those on
Write
A
discussion
For
,
1
,
of
this
-
nation actively at Work to achieve
the
nationalization! of ;our ^banking,
system, and in view of the inter¬
national trend in that directiqn,
we cannot safely ignore the chal¬
and
30's,
World War II
hoio-
were
causts that des
t
r
6 y e d
nade
or
lenge that these forces issue to
unrecog¬
nizable
Corporation,
Fire
Pacific
Insur¬
Company, Phoenix Insurance
ance
Wash¬
Company, and Providence
ington insurance Company.
General Public Utilities
Late
dhta—G. A.
<
Corb.-—
Saxton & Co.,
Inc., 70 Pine Street, New York 5,
N. Y,
!U
...
of
having the op¬
fact.
.
A
more
same
study
Telephone Randolph 4068
Bel! System CG 537
.were
Federal Deposit Disprance
of the
form
extreme
relatively^ young- countries like
the central banks have
been: nationalized and fhe; controls
to which private banks were sub¬
jected during the war have been
bur
own,
jextended into the postwar period;
Will Our Banking Be
I
Nationalized?
fidence
intended to restore con¬
our banking structure
method
t'o\ provide a speedy
thaw out and release
deposits
suspended banks. Res¬
toration of the public's confidence
in the stability of banks and the
safety of their deposits was ,'one
to
tied up in
.
major steps neces¬
sary
to prepare the way for gen¬
eral
economic recovery.
Without
doubt, bank deposits are the life*
blood of our economy.
To leave
a
frozen -/would have dpne
(Continued on page 2690)
them
<A
■
:
*
X'I1', 'vi J,
InA—
—We Maintain Active Markets
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DEEP ROCK OIL CORP. Common
GALVIN MANUFACTURING CORP.
Common
REEVES-ELY LABORATORIES Conv. Preference
Priced at 22V2 to Yield 4.44%
SILLS, MINTON & COMPANY
1
IH. M.
Byllesby and Company
*
Incorporated
INCORPORATED
York
.
>
in
and
'
Common Stock
,
ance was
of the first and
,
If something of this sort were
—
Scranton Electric
\A
CHICAGO 4, ILLINOIS
-
clergyman,
a
soft Of action has
r
-
to
other
operating
Greyhound Corporation
alytical
company.
Wire to New
convinced
'
208 SOUTH LA SALLE ST.
Direct Private
who. arC
us
brought together. After listening
under Federal for a
long time to the wail of the
or State supervision, the destiny,*
minister's parrot, "What shall we
progress,' and prosperity of each do to be saved? What shall we
unit depending upon the ability of
do to be. saved?" the old salt's
the "management, such as officers,"
parrot piped out, "Pump like hell
directors, etc,, selected annually:
or we'll all go to the bottomJ';
by the stockholders In meetings
Before going 6ri to discuss- some
called for the particular purpose.
of the problems with which we
; In many other countries such
must deal during the liexfc few
procedure Is no longer permitted,
thus chartered
banking has not years if we are to keep from going
to the bottom, I want to review
fared so well since the end of the
with yoti some of the develop¬
war. Last July," in England, a La¬
bor "Government committed
to ments in banking since the inid^
haAidnalizatiori of various forms of tile 30's, and particularly some-?
economic
enterprise was swept thing of the development and
into ^ower^: Socialization of the experience - of the Federal De¬
Bank of Engird led their list for posit Insurance Corporation dur¬
»
action and is now an accomplished ing that period.
:
?
;
of
those
Maple T. Harl
many
.
-
Available
Prospectus
-
N-/,
presslonof
An¬ ;to happen in the United States in
Seasongood & :
*An address by Mr, Harl before
Haas, 63 Wall Street, New York
oh
: Illinois Bankers* Association,^ St
baugh & Co., 52 Wall Street, New 5, N. Y.
Louis, Mo., May 2, 1946.
York
(Continued on page *2691) , •
send for Circular ML
Butterick to Blair F. Cla'y-
Dealers may
5, N. Y.
.
forces within the
are
,
baper should have a constructive
effect
on
the
future
earnings.
Chicago Board of Trade
Corporation Common Stock
But there
—
>
National Gas & Electric
special | re¬
are
Automatic
~
.
I, the de-
As you' know, the; FDIC Was
happened;
NOfthern'
conceived
and created in 1933
in France since she was liberate d
•i
after
the most severe
banking
from the Germans.
There, too,
crisis that this nation* bad ever
Fire Association of Philadelphia socialization ;Of the central bank
Analytical report,— Mackubin, took
priority and the Bank of experienced. This crisis resulted
Legg &- COmpaiiyy 22 Light Strjeet, France is now "the property of all in the immobilization and ulti¬
mate, loss of a large volume of the
Baltimore 3, Md.
*
}'
the people of the Nation."
nation's bank' deposits in institu¬
Also avniJable nre memoranda
Not only the" Bank of France,
on
Fireman^s
Fnnd
Insurance
but four other huge commmercial tions which were unable to with¬
Company, General Insurance Cor¬ banks, in whieh great power had stand the ipost terrific economic
poration, Hanover Fire Insurance become concentrated, Were "social¬ depression in our history. Adop¬
tion by the Federal Government
Company, Jersey Insurance Cdm- ized at the same time.*
of the principle of deposit insur¬
In Australia and New Zealand,
pahyf Merchants Fire Assuraince
'
:
all within their
and
doing
are
■
J 70 Broadway, New York
FINANCIAL
-Rastenr^r
Also
Angeles 14,. Calif.
A11
Street,
report—Amos
Amott Baker; Realty Bond Price
Averages—Current news bulletin ports
3 J
Indianapolis, Ind.
Rockford, 111.
Cleveland, Ohio
w-
In
Co. —
Pont.
Dvvight jManufacturing
Descriptive
analysis—du
Homsey Co.,
31
Milk
Boston &, Mass.
|
I—Amott, Baker^Co,^Ih0.3T50
Broadway, New York--7^ N, Y,
:
v
.10 So. La Salle St*; Chicago
Tel. Franklin 8622
- &
Ge.r -2 31-- South--La
Street, Chicago, 111.
J"
v
.•
4, N, Y.
—Adams
-i
*Prtispectv,sAvailable t.on!
-V
Z-*; V ,1 f\ <5*
Co., 25 Broad Street, New
American Service Co^Circular
Tools Corpy,' Comi : i
Snap-On
•
situation in
the
and
Mfiil Compahy
American Rolling
Stone &
market
several interesting-issues.
—Analysis and outlook—Haydeh,
!
*Wells-Gardner &C6.,Coift.
.
Wall'
of
^Highlights
of
currOiit
the
available
Also
Young, Larson &
Grand Rapids National
Building, Grand Rapids 2.
Circular—De
'CG972,.
World
past.
War
they
power to speed fecpnversioh
to aid civilian production. -; ;
the
system, each unit
Curr<Jht situation and h^utldok
.
_-
American Forging and Socket—
;
ST., CHICAGO 4
Randolph 5666
...
.
threatin
knbw the
job our banks have done diiriAg
the1 War—we are1 satisfied that?
ened many
times
a
bled, here; fodgy. ' We
gral parts has
been
future, it would come as
shock to all of us assem¬
near
quite
inte¬
are
you
tion
Deane, 70 Pine Street, New York
HICKS 6• PRICE
the
system of
/
—
Lynch, Pierce, Feriner &
Merrill
!
\
this are extremely important and play a vr{al
role in maintaining the free banking system as it exists: in this coun¬
try today. The
^
■'1 ■
'• ■ !r::»
as
that the present system of Amer¬
Industries; social institu¬
ican banking is the best system/
Alabama
Mills,
Inc.;
Douglas tions. Banking did not escape un¬
You are all familiar With what
Shoe; General Tin; Upson Co.; scathed, but fortunately for Amer¬
New Jersey Worsted Mills; Mo¬ ica it has survived so far in its happened when two parrots, one
belonging to an old sea-dog, the
hawk
Rubber; Aspinook Corp.; basic form as an independent unit
American
Great
for the first quarter
of
i 946—Laird, Bissau & Meeds, 120
Corp;
The Chicago
and
be good public policy.
which most of
Portland Cement Co.; The
SECONDARY
State 6502
Upsori
may
Meetings such
dual
111.
Lawrence orandum on The Muter Co.
Parker
Appliance Co.; Pettibone Mulliken
L. A.- Darling Co.—One ; com¬
Corp.;. Armstrong
Rubber Co/; pany in four growth fields —
Ohio Leather Co.; American Fur¬
Analysis for dealers only—Moreniture Co.; Punta Alegre Sugar land &
Co., Penobscot Building,
Corp.;
Haytian
Corporation of Detroit 26,-Mich.
America; Latrobe Electric Steel
The
UNDERWRITERS
135 LaSalle St.
Street, Chicago! 4,
ing brief analyses of Philip Carey
Manufacturing Co.; Sargent & Co.;
For
CHICAGO 3
The
Chicago Corp.—CircularsHicks & Price, 231 South La Salle
Newsb—Brochure
Geared to the
f
.
.
high level of bank deposits will remain, and that increase in bank,
-;
•
GARTER H.C0RBREY&CO.
v
:
'
Electric
•
-
FDIG head, -calling attention to nationalization of
Utility Stocks as Good
Producers—No. 207 in
Oliphant's Studies in. Securities Sulzbacher, Granger', & Co., 111.
—James H. Ollphant & Co., 61 Broadway, New York. 6, N. Y..
i ";i- >yyyMWtM
Broadway, New- York ,6, Nv Y.
f
Consolidated i Gas Utilities and
Tele. CG 271
Randolph 6960
1945—Geyer>& Co., 67 Wall
Street, NeW York 5, N. Y.
.
CHICAGO 3
Tel.
Tabulated ; figures for
months ending December
•*-
twelve
1922
South La Salle Street
-
Chairman, Federal Deposit Insurance Corporation
banking in other
countries, points out. that this challenge td; private: banking cannot *
A.
S. Campbell Co., Inc. —be ignored by those who hold odr banking is the best systent;
Re-1
Analysis — New York HanseatiC
counts progress and success of Federal deposit insurant^ over last;
Cdrppration,- 120 Broadway, New
York 5, N. Y.
decade in protecting both the depositors and banks,, but cautions \
y 'that new problems mu^t be faced, of which (1) the inflationary.
Cessna Aircraft Co;—Study of;
dangers of the accumulation of liquid funds by public, and {2) re¬
situation in view of attractive out¬
duced ratio of bank capital to deposits, are most prominent. Holds.
look for light pla'ne industry —
Stock
Comparative : Insurance
Prices
maple t. harl*
thai ttie "firms' mhtioried will be pleased
interested parties the fotlowing literature:
is understood
•
C. L. Schmidt &
120
Deposit Insurance and
Recent Banking Developments
|||
Dealer-Broker Investment
,
-
i
Members .Chicago Stock Exchange
135
-
'
^
209 so. la salle st., chicago 4, ill.
Telephone Dearborn 1421
Teletype CG 864
So.
La
Telephone State 8711
New York
■'<■■■
Salle Street, Chicago
Philadelphia
3
Teletype CG 273
Pittsburgh
Minneapolis
|
Voliime163^Numbbr 4490
cr^ '•
THE COMMERCIAL & FINANCIAL CHRONICLE
Peerless
Reasons For Fii
prices of stocks.
•T-A
by the
Cleveland Trust Co. and edited by
Brig. Gen. Leonard P. Ayres, the
:
■
!
-
'
,
"During nearly all of the past
upper
band
reasons!why half-century f the
coUid properly have been consid¬
there may be
ered as constituting - the proper
a "further rise
,
in stock
prices
discussed.
are
."According
to
an
old, and
simple, ! and
seldom
used
test, prices of
common
stocks
are now
high enough
to
in
be
the
;
danger zone,
but still. they
far
are
Leonard
.
$*, Ayres
from
being unprecedentedly
:
bigh," the Bulletin states. "At the
foot
of
this page there
showing the
gram
dia¬
roots of
is
square
a
-the annual averages of the Stan¬
dard and Poor index of industrial
.-stocks
over the
past 51 years. The
figure for 1946 is
^ased oh only
the data of the first four months
•of the year.
A narrow band
nects the tops
of all the bull
con¬
mar¬
kets, except that which ended in
1Q29, and
similar
a
band
narrow
&>and connects the bottoms of all
-
selling range ..for common stocks,
and similarly the: lower band
could have been regarded as being
the proper buying range. The in¬
teresting fact is that stock prices
are now entering the upper band.
The diagram itself demonstrates
that there can be exceptions to the
ruje, The index entered the up¬
per band in .1925, but the great
bull market did not end until the
autumn pf |929. Similarly the en¬
suing., bear ; market did not ter¬
minate in the lower band in 1932,
but instead dropped well below it.
"There are at least three good
reasons
why this
present bull
market might continue after hav¬
ing entered the upper band which
has repeatedly marked the selling
range. Qne is^ the general pres¬
sures of inflation which result in
speculators having money to Ven¬
ture, arid' in. some cases impel
them to buy .stocks in the hope
that
securities
these
will prove
effective hedges against inflation.
A- second reason why stock' prices
ductive
|0 offered to the
lated
markets, except that of
1932.
MARKET
Kaiser-Frazer
{Herrick,
Corp.
Co., Inc.
the bear
published
TRADING
group headed
by
Waddell & Co., Inc. and
Geyer &
as underwriters on
May
1
In the current issue of the "Busi?^
Bulletin,"
Casually
Slock Marketed ;!
^rig* (Jen. Ayres lists - (1) general pressur^ of inflation; (2) high .pkodu'ctivfe capacity and accumu¬
lated shortages; - and (3) continuation or artificiaiiy low interest rates as factors favoring rise in;
ness
2647
subscribed portion of
capacity and of accumu¬
shortages of goods which
gives promise of producing a busi¬
public the
Of 50,000 shares of
a
un¬
COMMON
o
•
issue
new
stock"
common
the continuation of
(par $5) of Peerless Casualty Co..
Tne stock was priced at
$14 per
interest rates is
share.
ness
on
are
boom.
A third
good bonds
reason
is that
artificially low
making the return
low .that stocks
given increased relative value.
"There is
no
reason
KITCHEN & CO.
The
common stockholders
given the privilege of
subscribing for the new shares at
the rate of five for each eleven
who
so
except con¬
were
sideration's of simplicity for mak¬ shares now held, purchased 24,851
shares of the new offering.
,-.V
ing this sort of diagram on the
The company, an insurance or¬
basis of annual averages. It could*
ganization established in 1901 un¬
be made from
monthly, weekly, or
der New Hampshire
laws, orig¬
daily.figures.. The reason for us¬
ing the square roots rather than inally conducted its operations as
a combined stock and mutual
com¬
the original figures is- the prac¬
pany,
Since', April.J9, 190U it has
tical -and empiracal
onq. that the
been a stockv fcompahy. The com¬
square roots give better and more
consistent results.,The; Standard pany is engaged- in a general casr
ualty insurance and bonding busi¬
135 South La Salle Street
■
■
r
Chicago 3, III.
Tel.
STAte
4950
Tele.
CG
28
,
.
and. Poor, stock price index is
probably - the most scientifically
constructed; of. the 1 stock indOxtes.
It begins in 1918, but it has been
cOrfled bacjk for many -debates in
th.e
CdWles
Corhmissioil
/
ness/ both'as a direct
and
indexes
aire
Stock
the
same
bia.
■
ihdustrials, the rails, the utilities,
and all of these in combination",
-
■■,
^
:
■
;-v ■:.
|V| $3 Preferred, Class A
il; and Common Stocks
■Bi
vfe'i
'
•
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..
■'
qualifieidr
are
as
on
Request
☆
s.
"
V
y.;'V
/
^' /
'H/v;
Circular
hi
J /
.
'
^
'•<:
,
>,
'J>\Xj
<.
\. /
;
-
,l.u
•? \.'if
i.
.
I
-
i The proceeds, from the sale of
the stock will' be used by the com¬
pany to purchase securities; which
might continue, upward for some
and they arO available in monthly
period of time is that we have in
this country a combination of pro^ figures beginning in 1871. "
•«v.
com¬
workmen's compensation and va¬
rious- other- forms of
liability and
casualty. The company is- quali¬
fied to do business in
thirty-nine
states and- the District of ColUm-
companies. They
in four separate indexes the
SERVICE CO.
surety,
extensions
tation ahd includirlg as far as poscover
reinsurer of other
Among the lines under¬
written, by the company are: ac¬
cident/ health,, automobile^ bodily
injury ahd property damage, col¬
lision, burglary, fidelity,-
Of-1, the- Standard and Poor indexes
Using the same method of compu¬
sibble
a
AMERICAN
Underwriter
panies.
Price Indexes.
-"These
as
|
4 CO.
ADAMS
23!
SOUTH LA SALLE STREET
legal investments
CHICAGO
for insurance
companies organized
tinder New Hampshire iaws. -
TELETYPE C<3
4,
36!
ILLINOIS
i'
PHONE STATE 0101
...
James McLean Partner
In S. R, Belvsii Co.
Aeronca Aircraft Corp.
Appleton Manufacturing
I
James J. McP§an is being ad¬
mitted to partnership in S. R. Melyeh & Co., 2 Rector Street/ New
Company
....
Howard Industries,
Yorkr City.. Mr.. McLeah. "has^recently
been /with Thomson' &
.
McKinnort; prior to serving in the
Inc.
Hydraulic Press Mfg. Co.
!#//Kropp Forge Co.
|rmhd forces ^ he conducted - his
ihvestment business im NeW
York City. "
:
own
Miller
Manufacturing Co.!
Puget /Sound' Power!
&
Hentispksnc Sfcek
Exchange Farley Off
Light Co.
Superior Tool & Die Co.
!
•
Trailmohile Company
'
'
j The "hemispheric stock exchange
Conference
scheduled, for ' May
28th in; Montevideo, Uruguay,, has
been
COMSTOCK & CO.
postponed; indefinitely ac¬
cording \|io Word from Tomaso
Rodriguez; presideht'df the Santidgo, Chile,. Stock Exchange; The
,
New
York
Stock
and
Curb
CHICAGO 4
t
23t So. La Salle St.
T...
.
Dearborn 1501
Teletype CG
955
Ex¬
changes had planned to send dele¬
gates. to the meeting.
.;
'
1900
1910
,
-1930
1920
IB ought—S old—Quoted
East Bay Specialties Co.
1940
*
-OAKLAND, GAL,~ Eagt Bay
Specialties Company," Easton
Building, will engage in the se¬
;
ialsey, SiuartSeSIs
Western M
Epipj'ls
Halsey, Stuart & Co. Inc won
award May 14 of $2,000,000
Commerce • Commission approval. sued to provide for approximately
The certificates mature. annually* 77% of the cost of. 12 new stand¬
June 15/ 1947 to 1956, inclusive;' ard gauge 4-8-4 "steam locomotives
and are being issued under the and tenders.
Philadelphia Plan.
Associated ^With
-the
"Western
Mary land4 Railway
Co.
equipment trust certificates,
ser¬
ies
Jf as.5, and immediately re-,
offered them at prices to yield
ifrom
to
1.05 %
to
maturity,
&
Co.
Inc>
in
Intersate
the
offering
lins
' v
J
»>
f
*
T *
;
.
£>
l'
»
*
U
High.
&
First
Co.;
The
of
are
•
■
E. H. Rollins & Sons
^
CG1 530
BONDS
i
'
Direct
•
'
wires
•
■
to
•
our
Central/ 7540
offices in
principal financial centers
r|2 Si 0
is-
Public
<
,
€1^/
-
U til it y
v v'
J
'
I
Railroad
r? •
SOUTH
:
N
-
Macfaddein Publications
V
Municipal:
Gisholt Machine
;
BEND
K
-
7
All Wisconsin Issues
ft
■
& CO.
AjC.AmfN«®COMMNY
.
INCORPORATED
Incorporated
CHICAGO
-
O,
>CIHCAGO 3, ILLINOIS
105
;
CG
NEW
,
Teletype: CG 1200
HOLLEY, DAYTON & GERNON
Member—Chicago Stock Exchange
''
.135 SOUTH LA SALLE STREET'
"A"
Request
.
•.
DOYLE, O'CONNOR
6161
on
Industrial
.Circular available upon request i
Telephone: Dearborn
Cement
?Prospectus
//-.
Incorporated
/•/;•
135 South La Salle Street,
yy!/!;-;-:;: CHICAGO 3 r;,:.-/ fyc-A.
Michigan
being
Steel
&-Preferred
Consolidated
f
■
<
certificates
Jessop
-
.
UTILITIES
&
:
are:
Corp.; F. S. Yantis & Co. Inc.; and
-MIDLAND REALIZATION
^
ter A..
*
M. H. Ezell and Dr. Les¬
Sons; Putnam & Co.; Julien Col¬
CHICAGO SOUTH SHOftE
.
are
Otis & Co. (Inc.); Alex. Brown &
DEEP ROCK OIL
MIDLAND
firm
^
^Wayne Corrugated
Paper Com.
Common
Partners in the
Halsey^ Stuart.
1.75%, according Thomas & Co.
subject to
curities Msihesa.
Ft,
YORX
||
/ BOSTON
OMAHA
MILWAUKEE
.
MINNEAPOLIS
KANSAS CIlV
-
v":'..; "
So. La Salle St., Chicago 3, III.
262
Central
Offices
Eau Claire
:/
-
*»> Wisconsin
Fond du Lac
Madison"
-
-
0780
-'"f:
La Crosse
Wausau
commercial loan department.
Michigan Brevities
investment
bankers, purchased an issue of $5,000,000 University of Michigan
dormitory revenue bonds from the Board of Regents.
Proceeds will
be used to redeem $1,926,000 presently outstanding lVz% bonds
dated June 1, 1944, and for new construction.
1
Michigan Corp., heading a syndicate of
The First of
'
^ <<
on the De¬
continued to
month, with sales < at
last
413,025 having a market value
has received an
Company
226,973 additional shares
the Hudson Motor Car
list
to
of
1,588,810 warrants
which would entitle holders to
subscribe to one new share for
each 7 now held. Date of record
and
of stock
This compares with
342,592 or $4,529,201 in the pre¬
ceding month, and 326,133 or $4,204,235 in April of 1945.
$5,033,048.
Stock Exchange
application from
Detroit
The
v
troit Stock Exchange
climb
—
—
trading
of
Volurne
'*'/::*
*
-
not been deter¬
and price have
mined.
MICHIGAN
UNLISTEDS
capital. Baker, Si& Co. of Detroit is the
and working
monds
principal underwriter of the issue.
Wm.C.Roney&Co.
Members New
DETROIT 26, MICH.
Phone
Cherry 6700
"IE 167
ait
*
Established 1919
Members Detroit
subject to listing re¬
quirements of the Detroit Stock
Exchange, so that 5 shares of
common stock will be outstand¬
Stock Exchange
bear/a' 2% and 1%% interest rate
and mature serially from May 1,
Michigan Markets
1947 to May 1,
DE 206
trigued by the
str a nge de¬
vices
applied
in
this fight
:•
•'
•
with
request
Walling, Lerchen& Co.
To Admit W. M, Spade
'"v..-"'-• ' .,".y'r. ;V•*„'•// 'A
Manufacturing Corp.
Report furnished on,
(Special to Thk Financial Chronicle)
BENTON
Cadillac 5752
Stock
HARBOR, MICH.
—
Holland has joined the
staff of II. H. Diffenderfer & Co.,
Fidelity Building.
DETROIT, MICH.—Albert Ritz
the
.
the date
as
simplification?
further
firm's capital
the
Chronicle)
The Financial
*
Penobscot Building, after serving
in the U. S. Army,
Chronicle)
(Special to The Financial
DETROIT, MICH.
Arthur. N.
—
Nor
con¬
flicting con¬
sul d era tions that inpaui Einzig
fluehce both
camps
ade¬
quately understood. So the Brit¬
ish public is following with in¬
tense attention a game the rules of
which*it ignores — a fact which
makes the game all the more ex¬
citing, since the unexpected is of¬
ten liable to happen^ and it is dif*»
ficult to assess the odds.
As usual when the fate of some
matter of public interest is in the
balance and the outcome is incal¬
culable, a great deal of betting is
being done in the City and else¬
where concerning the decision of
Congress. Some days ago (i.e. be¬
fore the Senate passed the bill)
the odds were about 60 to 40 in
The
favor of ratification.
narrow-
of the margin of votes makes
ness
people hesitate to back up
their conviction that the loan will
many
Larkin and Danks
Honored
passed by the House of Represenatives. Generally speaking it is
true to say that official opinion in
now
not
so
anxious about
the fate of the loan as it was two
months
ago.
When for the first
since the conclusion of the
time
§
by Bond Group
Sylvester P, Larkin, of Pflugfelder, Bampton & Rust, and Rob¬
ert D.
Danks, of Ernst & Co., were
guests of honor at a dinner ten¬
dered by the Association of Bond
Brokers of
the New York
Stock
Exchange at the Hotel Pierre.
Mr.
Larkin is
retiring from the board
of governors of the Stock Ex¬
on which he served since
1940, and Mr. Danks is taking his
place on the board.
change,
Other
guests
included
Emit
Schram, President of the Ex¬
change; John A. Coleman, Adler,
Coleman & Co., chairman of the
board of governors;
Robert P.
Boylan; Raymond Sprague, Ray¬
mond Sprague & Co.; Robert L.
Stott, Wagner, Stott & Co.; Geo.
F. Hackl, Jr.,
Laird, Bissell &
Meeds; Harold C. Mayer, Bear,
Stearns & Co.; Roland De Haan,
Mahon & Co., President of the
Association of Bond Brokers, and
Sidney P, Bradshaw, of the As¬
sociation of Stock Exchange Mem¬
ber Firms. Jacob C. Stone, Asiel
&
Co., acted
as
toastmaster.
J. Barth & Go. fo
Admit Three Partners
be
Britain is
DETROIT, MICH. — Rudolf A.
Sorlie is now with Chapin & Co.,
Bank has added
branch office, at 11120
new
a
to
*
*
*
(Special
the
are
Louis A.
is now with Baker, Simonds & Co.,
15
May
request.
SAN
F.
Sinton,
and
Hellman,
Berwyn
Barth
&
Cos
Robert
E. Stewart
partnership in
will be admitted to
J.
CALIF.—
E.
FRANCISCO,
Marco
California
482
Street, members of the New York
and
San
Francisco
Stock Ex-
agreement dohbts hbout its ratifi¬
changes. Mr. Hellman in the past
cation began to arise in March, of¬
was with Bankamerica Co.
•.
ficial
nervousness
found'expres¬
Effective June 1st, Gustave Ep*
sion? in the display of
irritability
the stein, member of the New York
staff of Marxer & Co., Penobscot
#
*
*
to Stock Exchange, Stanley H. SinBuilding.
Joseph M. Dodge, President of
questions in the House' of Com¬ ton, and Richard O. Simon, gen¬
The Detroit Bank, announces the
mons tended to become very bad(Special to The Financial Chronicle)
eral partners in the firm, will be¬
appointment of G. C. Mellinger as
tempered. No such effect was eviDETROIT, MICH. — John E.
come limited partners.
(Continued on page 2699)
Blum, Jr. has been added tp the
Grand .River.
& Dolphyn
Detroit
the loan.
Watling,
—
for
when declared.
Mercier, McDowell
Buhl Bldg.,
both sup¬
porters
and
opponents of
Michigan Personnels
The Michigan
Members
MICH.
in¬
much
by
July 1 the small
on
structure.
It also removes restrictions in
connection
with
payment
of
common stock dividends if and
of
Shelter
v
are
and
Buhl Building,,
for
:
(Special to The Financial Chronicle)
closing further exchanges. Pur¬
pose of the
call, according to
DETROIT, MICH. — Walter R.
company officials,
is to elim¬
Eis has become connected with
inate the stock from the finan-y Carr & Co., Penobscot Building,
cial
statement
in
accordance' after serving in; the U. S. Navy.
Electromaster, Inc.
on
stand Congress
have
registered
15 will participate.
DETROIT,
Brit¬
r$>—v
o v e
under¬
procedure, and
remnant of class A stock,
i
fixed
^Prospectus furnished
distributed
be
*
'!«
McCord Corp. has called
retirement
Teletype
Telephone
here
1954,
*
Building
Randolph 5625
;people
by
that datei Holders of record May
.
DETROIT 26, MICH.
'<
the basis of
ber of years.
amount of higher coupon
bonds outstanding. The* new bonds
639 Penobscot
to
effectively
mean
and bilateral agreements, and
of Anglo-American cooperation.
share for each 4 held, if the
been
Says this would
in the
shares
be made June 25 on
equal
\
unissued
possible rejection.
I LONDON, ENGLAND—The concluding phases of the loan debate
Senate were followed here with anxious interest.
Very few
author¬
is to
of presently
out
but
ized
a
.
adherence to colonial preference
lesser degree
outstanding. Distribution of the
stock
EINZIG:^-tfyi^
ish withdrawal from International Fund and Bank and continued
has
Co.,
&
planned to offset
,
presently
ing for every 4 shares
By PAUL
Dr. Einzig reports that feeling in London is that final Congressional
ratification of the loan is still uncertain, and measures are being
adjusted,
purchased $16,000 Oakland Town¬
ship School District No. 2 bonds.
Proceeds will be used to Call an
'
;s
stock of the De¬
troit-Michigan Stove Co. will be
The capital
has
#
McDonald-Moore
Charles A. Parcells & Co.
v
v; .;-
v
Lerchen & Co., Ford Building,
approved ah application to list
297,937 shares of $2 par value members of the New York, Detroit
common
stock of the National and Chicago Stock Exchanges, will
Stamping Co., subject to registra¬ admit
Wayne M. Spade to part¬
tion becoming effective.
Trading
Mr. Spade
in the stock is expected to begin nership on May 23rd,
has been with the firm for a num¬
the end of May.
BUILDING
v
Teletype
*
The Detroit Stock Exchange
York Stock Exchange
812 BUHL
*
$
v? y'-'.y-'y i.y *
Betting
On American Loan
National Bank of Kalamazoo.
can
shares
#
#
Crampton Manufacturing Co. of
Holland," Mich.,
has registered
with SEC 240,000 shares of $1 par
value
common
stock. Proceeds
will be used for plant expansion
Britishers
replaces the late G, L. Wessinger.
Mellinger;; has "for several years
been Vice-President of the Ameri¬
one
'
Ht
Call Us On Any
.the
He
in
Vice-President
Assistant"
Thursday, May 16, 1946
FINANCIAL CHRONICLE
THE COMMERCIAL &
2648
Exchange
Detroit 26
Tele. DE 507
.
by Mr, Dalton, Chancellor of
Exchequer,. whose1 answers'
Furlong is with C. G. McDonald
& Co.,
Michigan Markets
American Forging
£y.•;>C
ACCURATE
:r
Guardian Building.
(Special to The Financial Chronicle)
DETROIT, MICH.
Porter,
_
Simonds
& Socket Co.
DEPENDABLE
r,\ \
■%
■
f'>,<
'r
»-
'
•
i$y,
\'-v
.
&
Co.,
Baker,
with
with
is
McDowell
Mercier,
Claude G.
—
previously
now
NSTA Notes
Dolphyn,
&
Buhl Building.
Circular
on
Request,
Inquiries Invited
(Special to The Financial Chronicle)
white, noble & co.
DaYoung, Larson & Tornga
Members Detroit
,,
GR 84
/
,
Phone 98261
ing. He
Teletype GR 184
Phone 94336
—
Jack D,
rill
was
Build¬
previously with Mer¬
Pierce,
Lynch,
&
Fenner
"
Beane;
■
,
(Special to The Financial Chronicle)
•
L. A. DARLING CO.
One Company in
berger j oined
A.
Precision Castings
Plastics
Grey Iron Castings
j,
MEMBER
1051
DETROIT
STOCK
1 }
-
EXCHANGE'
(Special
■
Battle
Creek
—
Bay City
—
Lansing
Co.,
a u
g
I
.
'
'
Muskegon
•
^
BOND CLUB OF LOUISVILLE
Berwyn % Moore, President of the Bond Club of Louisville, an¬
nounced that the Association has been advised to postpone their
Spring Frolic scheduled for May 17 and 18 to a later date because of
possible transportation difficulties.
SECURITY TRADERS ASSOCIATION OF NEW YORK—
CONVENTION SPECIAL
The Annual Convention of The National
Penobscot
There will be cars
to The Financial
RAPIDS,
Conger
is
Chronicle)
MICH.
with
h I o n-Greenawait
on
—
Security Traders' Asso¬
MacCo.,
&
an
expense
,
basis which amounts to approximately
$425 per
This will include all hotels, meals . and transportation.
Among points of interest to be visited will be the Grand Canyon.
The train will leave New York on Friday, Sept. 13, in the afternoon.
?
Michigan Trust Building.
all
Sept. 17.
leaving New York to join the special caravan
person.
Since the number
of reservations alloted
is limited, it
to make applications well in advance.
Most of those who have already made their plans are
will be
necessary
(Special, to The Financial Chronicle)
•
—
1 and June 2.
ciation will take place in Seattle, Wash., beginning on
G.
Ralph
Omo is
V?v
"/•' *
at
the staff of Charles
&
JACKSON,
DETROIT 26
'
Parcells
GRAND
111
PENOBSCOT BUILDING
^
George C.
SECURITY TRADERS ASSOCIATION
Angeles Security Traders Association will hold a party
Lake Arrowhead Lodge, Lake Arrowhead, Calif., on May 31, June
The Los
■
N
Morel and & Co,
—
Building.
Display Fixtures
Analysis For Dealers Only On Request
DETROIT, MICH.
Kempton and Frank W. Hacken-
Four Growth Fields
LOS ANGELES
Gould has become affiliated with
Moreland & Co., Penobscot
\
GRAND RAPIDS 2
MICH. TRUST BLDG.
!
GRAND RAPIDS, MICH.
Stock Exchange... -
DETROIT, MICH.
now
Butterfield
MICH.
—
Ross L.
connected with H. II.
&
Co.,
Bank & Trust Co.
Jackson
Building.
to
take
ladies
their
wives.
will be
arranging
the
special entertainment for
W.
and
members communicate with him promptly in
be properly provided Tor.
1
Vv
^
during the Convention and trip. Mr. Win Pizzini of B.
agreed to act as Chairman of this Committee,
Pizzini & Co. has
City
it
.
order that
is
There
suggested that
they may
Volume 163v! Number 4490
THE COMMERCIAL & FINANCIAL CHRONICLE
i ABA Committee
Connecticut Brevities
The Electric Boat Company of Groton reported net income for
the year 1945 of $2,220,976 or $3.19 a share which compares with
oni//J |||II
Treasury Savs. Bonds
As one
of the
on
steps in its
pro¬
$1,974,713 or $2.75 a share for 1944. While the income account for gram to combat
inflation, the
1945 is subject to adjustment for renegotiation of war contracts, it is
American Bankers Association is
believed that the net effect will not be of any great cpnsequence.
organizing a national ABA ComFigures for 1944 have been adjusted.
" ' •
:
mittee
on
*
As of the first of the year, un-<^
Treasury Sav¬
filled
orders
amounted
to
shares.
$10,-
declare
vote
on
stock
a
proposal to
a
dividend
pay¬
able in $2 convertible preferred
stock of $50 stated value at the?
ratio
of one
four
every
preferred for
new
shares
of
common
H» "
them
new
products—among
line of medium-sized color
a
offset
presses,
pin
"electric
an
boy" which eliminates the pin boy
from
bowling alleys, truck bodies
the issuance of
having welded steel hulls for
fishing fleets, a
pleasure boats, and
of
com¬
line
new
plywood
bodies and trimmings for automo¬
biles.
./
During the first
three
months
of this year, Southern New Eng¬
land
Telephone earned $868,254,,
$2.17 a share compared with
or
$632,247 or $1.58 a share for the
corresponding quarter of 1944.
Total telephone revenue for the
month of March was $2,995,425, or
12.8%
Net
than
more
income
for
March
March
1944.
of
1945
was
*
'
.
■/.//
States
Lock
authorized
have
additional 750,-
an
financing will provide
During
the
first
of
through
sale
per
for
of
*"
Savings Bonds
White,
Div.
Cost
Co.
106%
3.50
Read & Co.
106 Va
3.50
3.343
106/
3.55
home
3.60
t
Corp.
Boynton & Co., Inc.;
Clark, Dodge & Co.; Lee Higginson Corp.; E, H. Rollins & Sons,
Inc.; Spencer Trask & Co.; Hawley, Shepard & Co.; The Ohio
to be named to head
Co.
Floyd
President
of
suspension
to
General
Electric
of
'in
M.
the
Wilson,
long
Fred Udell, also previously associ¬
ated with. Ralston-Purina, will be
,
Company
net loss of $742,771
reported
Illuminating
a
decline in
illness of several weeks.
also be six State Chairmen repre¬
Co.
&
:-v;;
///••••/
A:"i/
• |7
."'i/v'•
•(
4'
7, »
Y'v
The company has
sey
State Charter.
to fill the glass container needs;
for the
entire New England
.
For the first quarter of the cur¬
territory.
senting
the
on
savings of $1
mutual
six
Wilcox-Gay Corp.
^Ampco Metal, Inc.
^Pickering Lumber Corp.
Majestic Radio & Television
Corp.
Bonus Products Co.
^Statistical
as
compared to $778,030
J.
of
preceding
or
aid in
our
White & Company
iouls
Members St.
we are
to preserve
HII
ST. LOUIS 1, MO. /;/•/;
Bell System
We
are
City Southern Ry. oh May 14
interested iti
Riverside Metal Co.
au¬
and
★•■a.V.
i.
.
the
Plowman
Berkshire Fine
Spinning, $5.00 Preferred and Common
Chicago, Wilmington & Franklin Coal
Trust
election
'
-
J"
-
,' '-V-
'•
j
-•
'
' /'/<
// 4 '
•'■1
■
718,Locust Street
Saint
Louis
1,
•
Mo.
'
'
Central 8250
■
St. L. 499
L. D. 208
Rudolph Wurlitzer
j
^
Suburban Propane Gas
7
i
■
(
Kansas City Public Service, Preferred and Common
Consolidated Dearborn
Exchanges
Associate Members New York Curb
Exchange
.' V V'
*'
Tennessee Gas & Transmission
Tiffi Brothers ;
'
:^ COMPANY/://;///
Chicago & Southern Air Lines
Assistant
as
Members New York and Boston stock
;
Metropolitan St. Louis
Banking
Schroder
announce
Paul
MAllKETS
Schroder
Henry
^
a
for 1945 are subject to adjustment
for renegotiation of war contracts.
The balance sheet for the
year
Teletype—SL 477
thorized the directors of that road
2-360)
on page
Secretary of both organizations.
Results
year.
Stock Exchange
Mississippi Valley Trust Bldg. ""
The stockholders of the Kansas
continuing sale of Sav¬
ings Bonds if
1945
$4.98
(Units)
Information fon Request
'*>wm
Company
share the
■
Paul Plowman Elected
period in 1944.
for the year ended Dec. 31,
.';;
June 15 will pay a dividend
per
banks associations..
(Continued
Corporation
Peter Paul, Inc. reported net in¬
come to $724,383 or $4.33 a share
y
'
common
against $4.50 and $1.51
respectively for the corresponding
v/'if* Si--*
' "y,
•
*Mid-Continent Airlines
rent
year, the company showed
estimated earnings of $11.40 on
the 7% preferred and $5.29 on the
.>"v'-.•••/ ; y
».
*Stromberg-Carlson Co.
•
of Connecticut.
Stocks
Insurance
The Minneapolis & St. Louis Ry.
a
been operating under a New Jer¬
Markets
Primary
Bank
President.
share on the common
stock to holders of record May 31,
Appointment of an ABA Com¬ 1946;
sales of kilowatt hours for the
mittee on Treasury Savings Bonds
or a deficit
The St. Joseph Light & Power
months of April.
Total sales of was
of $1.53 a share against a net
made by President Rathje in
kilowatt hours were 52,510,197 or
Co, has called for redemption on
profit of $287,280 or earnings of
response to a request from Fred
June jl, next, all of the outstand
9.1% less than in April of 1945.
M. Vinson, Secretary of the Treas¬
59c a share the corresponding
ing St. Joseph Railway, Light,
period in 1944. The strike situ¬
ury, who said in a; letter to Mr.
Heat & Power Co. first mortgage
Knox Glass Associates, Inc. of
ation was responsible for this
Rathje: "The banks earned the
bonds, 4^% series due Dec. 1,
Knox,, Pa., is conducting nego¬
gratitude of the Nation by their
decline.
1947, at 100 and interest. Immedi¬
tiations for the purchase of land
services during the years of war
ate payment will be made upon
adjacent to the Electric Boat
The
financing.
In this difficult time
International
Silver
Co.
presentation of said bonds at the
Company yard in Groton. It is
has filed a certificate for incorpo¬
of readjustment the Treasury will
Guaranty Trust Co. of New York,
expected that a plant Will be
ration with the Secretary of State'
need more of this public-spirited 140 Broadway, New York, N. Y.
erected with sufficient capacity
this year, Yale & Towne Manu¬
facturing
Bridgeport, United
Company showed
,
Ralston-Purina
Denver division, will be Chairman
of the board of National Alfalfa.
bank Savings Bonds activities
in each, of the States. There will
largely
an
F.
up
at
Louis, Mo
May 14 at the age of 71, after
.
H.
ling
are
on
Associated in the underwriting
are
tional Alfalfa Dehydrating & Mil¬
Chairmen
.
Warrington Baldwin, for
head of the Missouri Pa¬
3.3959
Bros.-.,
Boston
First
during the seven- War Loans and
appliances.
Transport
3.3942
107.46
Lehman
&
the Victoty Loan.
mittee has been
*
Co. and the
Southern
Co.
3.322
Weld
Dillon,
The central com¬
appointed with
The Yale & Towne Manufac¬
representative bankers from each
turing Co. will broaden its activi¬
ties in a new postwar program by of the broad geographical regions
the addtiion of a line of electrical of the United States, and State
■■
City
cific system, died in St.
Price
Bankers Association, who is also
Stanley Works of New Britain is
President
of the
Chicago
City
negotiating for the purchase of
Bank and Trust Company, of Chi¬ Company; Kirkpatrick-Pettis Co.;
North Brothers Manufacturing Co.
cago.
This
committee will be The Wisconsin Co., and Rotan.
of Philadelphia.
headed by H. Frederick Hage¬ Mosle & Moreland.
*
*
*
'Donald Danforth,* President of
mann, Jr., Vice-President of The
Charles
Pfizer
&
Co.,
Inc., Boatmen's
National
Bank,
St. the Ralston-Purina Co., on May 10
world's largest manufacturer of
Louis, Mo.t and it will continue announced the impending sale by
penicillin, has completed negotia¬ the same
general type of organs that company of its Denver alfalfa
tions for' the purchase of the "Vic¬
ization as the ABA Committee on milling and produce division to a
tory Yard" on the east bank of the War Bond Drives that functioned new firm to be known as the Na¬
*
Kansas
23 years
Other bids were as follows:
Bathj e, President of the American
Thames River in Groton.
Louisiana & Arkansas Ry. Co., the
Kansas & Missouri Ry.
Lewis
States
,
#
*
*
share less
effecting ex¬
On this basis, the inter¬
share
a
and the yield is 3.271%.
.
work
quarter
sible
or
is
est cost to Union Electric is 3.315%
as pos¬
an expansion program
to individuals.
involving the purchase of addi¬ Appointment
machinery,
enlarging of of /the. n e W ^
J
-ft, / *»/ vv
H. F. Hagemann, Jr.
export and other departments, and committee was
announced in
expansion
of
brass
and
iron
foundry facilities.
.
j New York on May 7 by Frank C.
Due
■'''//
widely
as
on
stock
being $107
changes.
debt
funds for
■
bid
lic
tional
1944.
/' *
the
$1.44
the
J
,
$246,227 against $199,133 in March
*
as¬
uting the pub¬
United
new
about June 24 at $110 a share.
The new
being of-$
—
fered
to
the public at
107 per to merge three wholly-owned sub¬
share and dividends from May 15. sidiaries and also to reduce the
The Blyth syndicate designated board of directors from 18 to 15
a $3.50 dividend for the new
stock, members.
The
subsidiaries are:
Treas¬
holders and the unsubscribed por¬
'
be redeemed
unsubscribed
is distrib¬
ury
tion offered to the
public
will
ings Bonds
which will
Missouri Brevities
-.The Union Electric Co. of Missouri awarded at
competitive sale
May 8 130,000 shares of no par value preferred stock to an under¬
writing syndicate headed by Blyth-& Co., Inc., which submitted the
highest of five bids.
The stock is first being offered in exchange
until May 20 to holders of $5 preferred stock.
Unexchanged old stock
sist the United
will be offered first to the stock¬
'
mercial
new
stock-:
000 shares of common stock which
of "Armorlite"
plate, castings for
packaging machines and air-con¬
ditioning equipment, trawlers
*
'
Hardware
and
This
The company plans to manufac¬
to
The stockholders of Segal
held.
ture several
made
'
ing has been postponed to June
2, at which time the stockhold¬
will
will be
holders of record May 24, 1946,
The. company's annual meet¬
ers
Distribution of the
shares
871,000.
2649
Southern Union Gas
Southwest Gas Producers
-
end showed total assets of
$6,427,-
304, with current
234,421.
Current
of
$5,-
Primary Markets in
to¬
Hartford and
leaving
net
Leland Electric
Southwest Natural Gas
liabilities
Mills
Colonial
*
*
'
Old Ben Coal, Common
Universal Match
talled
assets
$1,830,948,
working capital of $3,403,473.
Following
approval
stockholders,
the
by
directors
of
SCHEFCK, FIGHTER COMPANY
Landreth
BOwling Green 9-2211
Bell Teletypb
Bel!
System Teletype: HF 365
1,000,000
Fifty-fifth Year of Dealing in
Peltasonjenenbaum Co.
;
New York:
a
four-for-one split-up which will
1 increase the no par capital stock
;
Hartford 7-3191
the
the company have authorized
from 250,000 shares to
Connecticut Securities
•
SL 456
St.
Building
Louis
LANDRETH
2, Mo.
M
BUILDING
ST. LOUIS 2,
Garfield 0225
L. D. 240
Teletype—SL 486
L.D. 123
TRADING MARKETS:
Connec tic ut Sec urities
Primary Markets—Statistical Information
Mosinee Paper Mills
a,;:--.
Pickering Lumber Corp.
Stix & Go.
Long-Bell Lumber Co.
Western Lt. & Tel. Co.
Lucky Tiger Gold Mining
Marshall U. S. Auto Supply
INVESTMENT
SECURITIES
509 ouive:
Chas.W. Scranton
Members New York Stock
New Haven
&
Co.
Exchange
BlRHIilXlElR: GO
1016 Baltimore
Bell Teletype
London
Hartford
2-4301
Phone—Harrison 6432
*
'-V
.
■
X/
:; Vs
6-0171
New York Canal 6-3662
5-2410
St.Louis lf>Io.
Avenue, Kansas City 6, Mo.
KC 472-3
street
a
•
—
Private
New
f ^
M0.
Teletype NH 194
Waterbury 3-3166
Danbury 5600
Strauss
Bros.
New York and
Chicago
Wire
White
Connections
&
Company
St. Louis
To:
Members St.
Pledger
Los
&
Company
Angeles
Louis Stock
Exchange
the profits be¬
before division of
landlord
tween
hotel at present
EstaM Secu
Real
Thursday,1 May 16,1946
CHRONICLE
THE COMMERCIAL & FINANCIAL
2650
the
3nd tenant,
is in a position to
Public
expend $1,200,000 without making
additional contributions t o t hi js
modernization fdnd.
* /
•
-
Utility' Securities
.
Since earnings per share are ap¬
12% of the current
with
proximately
Commodore Hotel
,
offering price of the stock,
sharply the. elimination, of the corpora¬
has begun tion's debenture; "obligation, th£
.to veer away from hotel bonds and their pre-fixed ceilings and center common stockholders may soon
lin hotel stocks offering better possibilities for appreciation,
find themselves reaping the bene¬
Since a market in most hotel stocks is either quite restricted/of fits of a liberal dividend and the
non-existent, consideration must perforce be limited to issues which concomitant market-wise appreci¬
With hotel revenues for the first* three months of 1946 tijpr
.
,
compared with the corresponding period in 1945, interest
as
..
.-
v.
.
a
offer ready marketability.
^
f
Perhaps the most attractive of
*.the issues traded in briskly in the
<$>
common
Hotel
the
is
market
over-the-counter
Corporation
in New York
City. Thig stock was issued in ref
organization. :inexchange for. the
preferred^ second preferred
first
ation of their stock,,
stock of The Commodore
BLOCKS Of
REAL ESTATE
SECURITIES
ary
common
of the New York Central
Rail¬
will
Activity ia "Street"
sumed his
ac¬
a
as
shares of Class A common
and
of
blocks
tain
489,970 4/7 shares of common
stock,
prevailing of¬
fering prices for cer¬
above
estate
the
common
stock
probability that
the
the debentures
issues/which" Werfc
to less
than $1,300,000 in the past year,
real
unlisted
in
from
reduced
lected
securities.
may
$2,168,050
from
be liquidated in entirety dur¬
ing 1946. This eventuality would
place the stock on a dividend-
Membert New York Slock Exchange
Members New York Curb Exchange
v;
40 EXCHANGE PL.,N.Y.
fief/ Teletype NY
Dlgby 4-4950
1-953
United
Piece
Huron
5
Dye
Works
Holding Co.
6* Broadway
Alliance
share, before.- Revenues/ for
after all charges,
are not unlikely.
Since, unlike an
industrial enterprise, a hotel need
share
of $1.50,
extremely liquid
position, the larger part of these
earnings should find its way to
not maintain an
Fred F. French Investing
*
Pfd.
Realty Pfd.
the common stockholders
the
once
debentures are eliminated.
L. i. GOLDWATER & CO
Members New York Security Dealers Assn.
:
New York 6, N. Y.
Teletype NY 1-1203
.HAnover 2-8970
Finances of the hotel ate strong
with current assets exceeding cur¬
rent liabilities by over
In addition, in
39 Broadway
Offerings Wanted:
Beacon Hotel 2-4/58
tain
for
four
Com¬
the
of
manding Gen¬
eral, Army
S
r
e
v
of
Recent
Troster
Jf.
Oliver
Par
-
/
$1,100,000.
contradistinction to
of
the
annual election of offi¬
Chapter
the Minneapolis
Institute of
of the
Northwestern National'Bank/was
elected ; President
and
John
K.
Ewihg of the Minneapolis Reserve
was made Vice President, said the
Minneapolis; "Journal" on April
23, which further stated:
"Ralph Spearing, Midland Na¬
bank, Was elected .Second
President,/ and Lawrence
Vice
EL plan.
treatment under the two plans:
Common
Pfd.
2nd
Pfd.
1st
28
160
157
$177"
200"
187"
1,
Plan—
$200
"
205
or
or
"Approximate."
or
6.5 So. El.
or
casht
or
$177 casht
or
$190
tApproximate
Electric
Shares feels that the
Bond
EL plan
in the
&
is
Broom,
Northwestern
National
Bank, was elected Treasurer.
of course,
are
the
EBS
plan
dissolution,
provides foj:
EBS' dominant interest
lowing would be the values, which
holders
two
under
realize
vhrying
at
plans,
preferred
three
the
of
would
stocks
—2nd preferred—
•
EL
EBS
UNT
EBS
V-Vv$i78
$178
21
19
162
18
153
153
17
•145
-145
..
v"
•
*
4^2/58
Southwestern Public Service
Common
England Theatre 5/83
Commodore Hotel, I nc.'H
Southwestern Electric Service
Common
Texas Public Service
Descriptive Circular
J. S. Strauss & Co.
on
request
SP 61
&
62
EXbrook
.«
>J
"
*■
x"
"
-h
>
t's
.
-
W*
' 's' /
V'j/1' '
^
Cpmmon
1285
Seliglnaiv tubetkiii & C<k
i
Incorporated
-
,,
Members
41
E
* J) *
Puget Sound Pciwer & Light
T—SPECIALISTS
REAL
Common
*
Montgomery St., San Francisco 4
Tele.
New
York Security
Paine, Webber, Jackson & Curtis
'
-
ESTABLISHED 1879
HAnover 2-2100
York 4
Broad Street, New
•
.
,
Dealers Association
SECURITIES
Alms
La
Hotel
Salle
"
•
Hotels
American Gas & Power Bonds
HOTEL ISSUES
One La.Sail
Lott
Co.
Consolidated Elect. & Gas
Madison
Beacon Hotel 2/4 1958 1V.S.
Roosevelt Hotel 5s, 1964
Savoy Plaza 3/6 1956 W.S.
Mayflower Hotel Corp.
Hotel Waldorf Astoria Corp.
Roosevelt Hotel Inc. Com*
§|| Midland Realization Common
Hotel
Chicago
Transportation Bldg., Chgo.
Pfd.
Sherneth Corp. 5Ms, 1956 W.S.
Commodore Hotel, Inc. Com;
"B" 4/47
■
'"/
/' •/; /
Common
'■'<
v
,
|
A. E.
Staley Manufacturing Common
r-/
(V. T. C. and Land Trust Units)
!
FIRST LA SALLE CO.
^11 So. La Salle St., Chicago 3, 111.
Tel. Central 4424
Tele. CG 660
■•V
-
| Obviously the two plans, are ing power of United Gas, and (2)
other hotels of this types, a mod¬
the advisability of encouraging
"Elected to board of governors rather far apart and the SEC will
ernization fund of $600,000 has
have to play, the role of -umpircl. arbitrage activity in connection
been provided for out of earnings. were William Bronner, Federal
•
1
The divergence between the two with the exchange offer.
Since. expenditures for' replace¬
Reserve Bankf Harvey Petersen,
The
management of Electric
plans appears due to a difference
ments, rehabilitation and modern-? First National -Bank, and Robert of
opinion between EL manage* Power & Light and United Ggs
ization approved' by the. landlord
submitted -(SEC
Exhibit 5)
a
Lange,
Northwestern
National ment and RBS officials regarding
may b^ deducted, after payment
(Continued on page 2656)
two factors, (1) ? the future earn>'
of basic rent, from gross earnings, Bank.;
Westinghouse Bldg. 4/48
155
"
k162
.
Broadway New St. 3/61
165 Broadway
'
170
20 V
170
"
Poli New
the
market
prices:
is
-$6 Preferred—
-$7 Preferrcd-
stock while EL's
common
rently selling at 19(though it
dipped from 20 to 18% after an¬
nouncement Of the EL plan). Fol¬
eh/
dissolution; but it is becoming the
to pay the premium on
senior securities in order to avoid
long-drawn-out 1 i t i g a t i o n. Of
Price
and So. Elec.
$175 casht
The range in UNT this year has
about 15-21 and it is cttr-r
fashion
course
UNT
been
titled to only par in
and
to
management
wish to protect
all classes of stockholders.
J
generous in its treatment of
pereferred stocks,fohitpffors
only
about
82^85%
as
much
United Gas in exchange. The pre¬
stocks
"
to sub-
scribe
6.5 So. El.
(plus any unpaid dividends since Jan. 1, 1946).
too
ferred
Rights
UNT
8.5
UNT
8.5
9 UNT
7 So. El.
EBS Plan
(?)
(?)
10 UNT
11 UNT
the
American
but on a
in the
Following would be the
favorable basis than
less
$6
Pfd.
Pre¬
paid
off in securities pr cqsh,
171
Obviously
Banking, Robert H. Baker
tional
E6
i
Minneapolis AIB
of
ferred stockholders would be
Offered Under Plans:
Branch,
Group.
At the
1st
dissolved.
be
then
would
Gas. ^Re¬
$196"
price
plug arrears
Call plus arrears
as
the Movements
He also served
in the Army for three years dur¬
cers
of United
$7
ice
Forces,
Chief
control
cently, without awaiting - further
developments
in
the
Supreme
Court, it filed a new, plan whicp
provided for exchanging a sub-
years, serving
in the
office
Baker Elected Pres. of
1946 are running so far ahead of
those for 1945 that earnings per
Hotel
Commodore
y
Earnings of the hotel have beph
exceptional during the past sev¬ ing World War I.
eral years,
Adjusting 1945 earn¬
ings on the basis df the presently
applicable income tax rates, the
common
stock earned $1.12 per
share after depreciation and $1.55
per
'
r m
Services
paying basis.
SHASKAN & CO.
A
has Mississippi Power & Light Com¬
pany,
and New Orleans Public
Service/Inc. Thd top/corhpahy
ahead with the latter pro¬
gram, but " last November indi¬
cated it would not attempt to rer
the
with
nearly
v
Interest
stems
se¬
stock,
Justice
,
This proposal was
to
due
gone
,
prevailing bid prices
and in some instances
parent company, Electric Bond &
Share, 'stated that it "disagreed
with the plan and would file one
of its own, which if proceeded td
do on May 10. EBS proposed set¬
ting; up a new holding company;
Southern / Electric. System,
In6.*
with a capitalization of 4,400,000
common shares. The latter would
take over control of Arkansas
Power & Light Company, Louisi¬
ana
Power & Light Company,
lies;
Chief
of
Court,
Supreme
still
Texas Company. The company
capitalization as at March partner in the
Col.
1, 1946, consisted of $1,311,905 in firm.
was
Series B and C debentures, IQQ Troster
above
pay
have to be reargued, but the
recent
decision
in
the * North
American Company case seems to
leave little dopbt that the Comr
mission's powers will be upheld.
In its original plan the com¬
pany elected to retain its southern
electric
system
and
also
the
United Gas. system. It proposed to
sell or dispose of' Idaho Power,
Utah Power & Light, the two
Dallas properties and Northern
it
may
Its
We
preferred stocks.
\
followed by a
rather • ■strange development—the
death
tivities
road Company.
WANTED
its own
the
Stone it
the
to
where
the
Stocks - of
■
Light
filed an integration plan in December
1941, proposing recapitalization on an all-common stock basis but
without specifying any formula: for distributing the new stock, or
determining to what extent the second preferred and common stocks
(then/ selling at nominal levels) | would participate. In August 1942
the SEC issued a "death sentence" order which was appealed to the
courts and in March, 1944 the Cir-<^cuit Court of Appeals upheld the
stanflal part of its 10,108,1(11The case was apf share holdings in United Gas for
Commission.
pealed
Gol. Truster Resraas
olq
Trpster,
Currie/ &
Summers.
Bowman^BiJtmpre Corporation, j 74 Trinity Place, New York ,City,
The company operates the 2,OOOr specialists
in
Over-the-Counter
room, 28-story Commodore Hotel securities,
announce that Oliver
at Grand Central Station in ' the J. T roster,
heart of New York, under lease Colonel, GenStaff
from the New York State Realty eral
and Terminal Company, subsidif Corps, has re¬
and
Two Plans for Electric Power &
Electric Power & Light
Amott Baker &
,
Gilbert j. Postley &
G
Incorporated .'••/ ViW
/ 150 Broadway
.
,
29 BROADWAY.
New York 7, N. Y.
,
Tel.
BArclay 7-4880
"
Teletype NY
1-588
;
Direct
NEW YORK 6, N.
Wire to Chicago
Co.
Y.|
,
THE COMMERCIAL & FINANCIAL CHRONICLE
Who Owns the Job-
Industry
] Chairman Simon of Hunt Foods predicts
at least two more years of
booming volume and high profit margins. Reveals tripling of his
company's current sales over last year, /|:?^?:/:'".:/
Exchange lo Be Revived
Labor?
or.
Bright Outlook Seen for Ganned Foods Industry
h\ Annual Field
Day
,
rofessor of
Job?" main¬
free coimlry, neither the
employee nor employejr owns
it, and that jobs exist only for the benefit of
society." Says problem
is one not of
ownership but of effective direction and
tains that in
t
^
u
°P*ni°n> the question, Who
The true
.
employee)
Thus
the
?:> And
that
beside
to
answer
these
ques¬
of
ance
ent
sales
but
the
"There are no margin restric¬
tions—and mo NASD profit limitatrons-^-and in - certain sections
Economics gives
answer
the
$41,000,000."
pres¬
dend
the collateral obtained is of 90%
I
grade."
t i
cated
would
t,
stock
-
Norton Simon
O n,
:
may well bring mod¬
erate recessions in both sales and
profits.
;Mr. Simon is in New York
brief
a
visit
in
connection
with
Active
trading! on the Exchange Hqnt Foods* entrance into eastern
must mean that everybody who will confinhe throughout the day markets next autumn, the adver¬
helps to make the product feels pf the outing. The final distri¬ tising^vjid/merchandising: related
important
namely,
Lewis
the consumers
that his reward makes his efforts
worth his. while;
H. Haney
of the
product—the public. (The
investor also has a Special in¬
terest.) f h .4■?
'
\
,
And, third, I think the question
about ownership is, in a way,
^phoney'^v jbeciause it conceals the
real question that lies back of it.
This question is: Who controls the
job? How han it be made most
/worthwhile to ajl the' interested
parties; including the consuming
public? The problem of the job is
not who owns it (if anyone), but
how to get the most out of the job
iof all concerned—how to direct
that
production and con¬
sumption will be maximized. Note well that "jobs" don't de¬
:
bution
of its assets will be the
climax of the day's activities.
Thus neither labor nor enter¬
prise has any claim', .or property
right,: except what comes from the
demand
for
Assisting Mr. Glidden in the
operation of the Exchange will he:
Louis H; Ing.raham, L. H. Ingraham
this
to
recent
/
national
expansion, and
financing by the
q result of acquisition
public
company as
during the last
year.
"Sales of Hunt Foods, Inc., in
:
product, and from & Co;;/C. Russell .Lea, Reynolds March ; 1946 ~ exceeded $3,000,000
efficiency hi making the; product. & Co.; Allan L. Melhado; John against
$1,000,000 in March 1945;
Neither employer nor employee
Nickerson, John Nicker son & Co.; This ' virtual/ tripling 5 of gross
has a bright to work," in the Jansen
Noyes, Hemphill, Noyes & sales,'* explained Mr. Simon, "re¬
sense of owning a particular job
consolidated
Cq.; and Percy N; Stewart, Kuhn, flects the
growth
at particular wages and
working Roeb & Co*
basjs of the company as a result
a
conditions,"
,'
: Roth have the human right to
subsistence—a decent subsistence
of its expansion program within
the last year. Hunt plans further
expansion. * •
.
,
—and as much more as they
qarn
by soiciaUy^pi/oLdjiict^
Green, Ellis Firm to
can
ef
Both have the right to an
equal' opportunity in seeking .to
develop their productivity. That
forts.
is all.
pend
on
ownership, or property
Again, neither employer nor
rights.
If we had a Communist employee has a right to
"security
state* and' everybody had to work of tenure," regardless? of perfor¬
foV "the G,oyernment," there mance. Both have legal and ethi¬
WOuld be no property in. the in¬ cal rights to continue exercising a
struments of production. Then no¬
(Continued on page 2659)
body would own his job. But there
V.
"The
Jewell, Archibald H.
Green, Ellis & Anderson, 2 Wall
Street, New York City, members
off the New York "Stock -Exchange,
of June
1. Mr.
MacMillan has
been° wi th
1944-45
sales
of
Hunt
Brothers alone, before recent
!quisitions and consolidations,
Busby and Norman S. MacMillan
will be admitted to partnership in
as
by his company
by Mr. Simon, who
his desire to main¬
at
be
least,. y; distributions
largely in the form of
dividends.
a
enjoy?
the firm/ in charge of
thje Wilkes^Barre, Pa, office; '
"
~
>
v '
-
of
manufacturers
.
;
his
that
doesn't
R5, jR* Settle Promoted;
shop might starve for lack of
"jobs."
acap¬
a
proximated $19,265,000. The forth¬
coming anhqal report.for 1945-46,
ATLANTA, : GA;— Royston
a job to .do.
He works
shorter hours, gets better pay,.and
has more, real freedom, including
freedom from risk, although he
owps nothing but his home. •
u
<-
*y
,
■
'5 *tVi?
v
-
'*
1
•.v^'v,\ v''';
•
"V
"
-.
*7
f
'
;
VicePriesident and John E. McClelland
of which has just has been elected Treasurer of J.
started,. will show sales approxi* H. Hilsman & Co., Inc., Citizens &
Southern Building. Other officers
mating $15,000,000. A strike at oh£
of the firm are; J. F. Settle, Presi¬
of the company's large (Fullerdent; J. F. Durrett, VicePresident,
ton) plants, combined with the and Frank J« Myers, secretary.
/,
preparation
:
Dated May 15,1946
Problem Not One of Ownership
All
this
is
v?.
a
Twenty-Five Year 23A% Debentures
;
V'"r,
7-',
problem,
not of
ownership, but of effective direc¬
'
:
,
Jc1
.
'
'
4
•'
-
tion and cooperation. It is a prob¬
lem of responsibility for the or¬
Interest
""
-
'
'
»
*>'*'.*
Due May 15,1971
-
'
VaiV;^
:
"
y
*>-
A.
?,
K
M
\
\
5
?£\
:>
ft '
•'
v,
-v1
payable May 15 and November 15 in New York City,
ganization and ' direction of the
j obi an<f for running the risk that
the product of the job may not be
wdrth the cpst.
There is
a
Price 98% find Accrued Interest
job in making clothes
for all of us. ? But somebody has to
what kind
decide
of
clothes
we
wiil want ,to buy, and how much
of each kind to make. And some¬
body has to' hear the risk of loss,
when
things are^ made that
w®
Copies of the Prospectus
the
don't
want. By the same token,
somebody else ha s to follow direct
tions and carry out orders.
And
are
obtainable from'the UJidetsigtied only in States in which
undersigned is legally, authorized to act as a dealer in securities and
in which such Prospectus may legally'be distributed,
'
those who don't want to bear loss¬
es,' but to receive an assured in¬
come
power
(wages), must recognize the
that goes with the respon¬
sibility
priser).
^
of
the
,
loss-taker
r
MORGAN
(enter¬
-
If we don't organize jobs, with
lines of authority, production be¬
comes
a
debating society, and de-
*
Radio talk by Dr. Haney over
the CBS network, April 11, 1946.
May 15, 19 iS.
It
Settle has been promoted to
(Incorporated in New Jersey)
which has
:
J. H. Hilsman & Co,
Standard Oil Company
:
■
that he decides to
successful business
suppose
for
work
''
v;
/*Then
spa¬
McClelland Treas. of
$85,000,000
guarantee that
macaroni,
out its/ line of present
products.
Tomatoes, fruits, / and
asparagus comprise the organiza¬
tion's major selling items.:
an offer to sell nor a solicitation of an offer to buy any of these
Debentures, The offer is made only by the Prospectus.
the shop will have any work to
do!
The owner of the machine
.
rophd
shop? He owns his tools,
materials, and the product.
But
.
paste
own
his
\
products; 47%
of Rocky Mountain Packing Cor¬
porations, Salt Lake City, vege¬
table
packers
specializnig
in
peas
and
tomatoes; ; California
Conserving Company/ one of the
largest packers of pidkles and
condiments in the United States;
arid recently Guggenhime & Co.,
large packer of dried fruits, such
as raisins, prunes, and figs. Hunt
Foods continually is considering
other
acquisitions / that
would
and
$his announcement is neither
•
Who owns the job when a ma¬
chinist is working for himself, in
r;.
year
would be "jobs," wouldn't there?
The only question is, Would there
be a$ much to eat, wear, and
divi¬
•
Admit ThreeP^ere
John
,
,
Hunt Foods, Inc.,
acquired: Fontana Food Products
Company (South San Francisco),
ghetti,
on
,.
in
Despite a net working
of $10,000,000, he indi¬
for
the .immediate
Within
/
-
.
that
future
impact of
' /
rate once it has been estab¬
capital
cqmpetitipn
:,
a
lished.
There-'
•
payments
emphasized
tain
',
.
forecast
was
sales
approach
conservatism
Extreme
profit
C
con¬
for consolidated
"Outlook
volume,
ta
government
for the present year will
em¬
record'
produ
change," said Mr. Glidden.
much that people' willingly pay
enough to cover the costs of mak¬
ing.. it.; And, incidentally, '? this
interest in "the
it "so
the
so
employer and
employee have
job,"
only
brace continu¬
10%.
is clear: A j,ob is-worthwhile when
it yields a product which is wanted
Second, I
an
Remember
tions is economic.
j0b.
others
prosperity will
not
of
tracts, caused this decrease.
is
nor
(the
think
termination
n'ia.^ This
buying new issues, for their own
after, with a/
only productive work, work that
aqco.unt, .before, giving their cus¬ restoration' of'
;ecopomicaIly. worthwhile, in tomers a
chance, will have a field European food
that the product covers the costs.
day at the Bond Club Stock Ex¬
(the
"owns "
the
the issues to, be dealt in, is being margin at the
distributed to the members- //III ?.'! abnormally
high level of
/ /"Members
who wish to continue
the French Army!
I am assuiping. that "jobs" mean
Labor
at
offering subscriptions in this
trading venture' and ' describing
"
foye,
employer)
held
tus"
owns
mocracy goes to seed.
Industry
be
Sleepy Hollow
Country Club on May 24th, were
announced by Nathaniel F. Glid¬
den, Glidden, Morris & Co./Chairman of -the-Committee in charge
A special "prospec¬
v of this event.
answer, therer-
is Nei¬
ther—neither
of New York
.
to
the Job—Industry or
First, I think that nobody "owns"
-corLls comPletely misleading.
jobs.
of the Bond Club
a
cooperation,
and that jobs are
"merely discovered by enterprisers," who must
choose among
laborers, as laborers must choose among enterprisers,
:
;
By LJEWIS II. IIANJEY*
H.. The canned foods industry will enjoy at least two more years of
: Plans
Economics, Graduate School of Business Administration,
for trading pn the Bond
New York University
Club Stock Exchange, one of the boom, according to Norton Simon, Chairman of the Board of Hunt
•Ifrovb
w >■■■
Df. Haney, in
principal features of -the Field Day of Califoranswering the question "Who Owns the
w
1
N. Y. Bond Club Slock
2651
STANLEY
& CO
*
,f
2652
Stabilization Program Restriction on
BOWLES*
Interest Rates
Director
By CHESTER
Economic Stabilization
>
perma¬
to
position
a
developed our jersey
own view of the merits of the
present case, I think the most use¬
ful thing I can do is to outline the
present general position of the
stabilization program itself, so that
the
Commission may take this
position into account in making
its present decision.
Since we have not
not yet in
are
know
the
whether
recently
granted =wage
and
increase
the other fac¬
tors
affecting
railroad
0
p e
i;
increaseneces-
and
not,
or
sary
if
crease
During the war we
in¬
an
Chester
is nec-ri
Bowie*
do
essary, we
the mini¬
mum
increase required at this
time.
I should like to make it
clear at the outset, however, that
it is not the policy of the stabiliza¬
not know
what would be
price or rate increases
and in all cir¬
that such
be made upon the
We
decisions must
feel
Bowles be¬
Commerce
connection with Ex
and Ex Parte 168,
^Statement by Mr.
fore
Interstate
the
Commission in
Parte
148
Hold-the-Line Order,
V-J Day was only 3 %*
Even
when
May 7, 1946.
we
vIS SSS Si.
oned
May
law
tending I
force
ex¬
power
m e
|
ceed.
At
they
can
more
no
of
at
i
#.
4
% ■
1:^*
prostrates
tell
f
<€%
itf
I
<
do
than
in-
off
block
i
■•irt''"".
f
U<
dustry«-<naL
mobiles, arrnm$
kty
transportation
sue* j systems t Is r t a t» p $
best safety. No
r-v u
n t S ;
alone,
for
0
!«i«up*
j critical period.- viak-w. i
rein-1 twecn
and
they cannot,
another year
the
war
en sc.
Without;
-the
state
del
of
have the
right
to#
jury uptm
.Dictators
|
tr,
.44
g,t
a
rp
the Commis¬
f 1
sioner to limit
forces
the armies
extend the Free
production are
fully mobi¬
i
f
hampered and, m
of inter¬
Eccle*
S.
Marriner
est which may
paid by
banking
i n -
be
stitutions
0 n
savings
and
demand
de¬
In his
address,! M r.
posits.
Laurence B. Carey.
Carey stated that "the opposition
to the bill centered primarily in
allow for
;
lized and in action.
a
t i o nary
until
of
Production-*
sustainable
highest possible
at the
\
hope-*-
however, they
are a last line
City,
11,
defended
on
or
lessly crippled { have already L«i i--w
now.
At best, \ because of"paraijus* »
at
several savings banks and they
deterioration exercised their sovereign rights
and launched a vigorous campaign
in the quality of certain types of
which almost defeated the bill."
goods, this record is vastly better
"While admitting that the control
than the one we achieved in the
of the
maximum interest that
six years after World War I began,
could be paid had been helpful to
when the cost of living rose 108%.
a
substantial degree in rebuild¬
The average of wholesale in¬
dustrial
prices rose 25 % from ing depleted capital accounts of
banH^rt
Mr. Carey
August, 1939 to V-J Day and 3%
(Continued on page 2639)
(Continued on page 2654)
to
indiscrimi¬
nately at all times
cumstances.
Atlantic
the crucial stages fa
about winning if prue c
It is futile to talk
of
New
Bankers*>Association
had much
Roosevelt's
arbitrarily to oppose
tion agencies
in addressing the
rate
following President
1943,
■.
the maximum
greater
success
in
stabilizing
prices than most people dared to
hope.
From August, 1939, the
beginning of the war period, to
V-J
Day,
the consumer price
index of the Department of Labor
increased 31%. The increase from
May,
is approaching
The country
tion.
Banking and Insurance
Wartime Price Stabilization
Successful
rations
make such an
sioner of
New Jersey,
hand.
We*
rates.
of
particular cases at
of the
merits
increase
maekintr a kccikm*
by
working toward inflation. Analyzes posi¬
tion of stabilization program, which, in view of heavier consumer
and business expenditures and backlog of consumer demands, he
says is "in a state of precarious balance,"
Holds it will be in best
arid need of further strengthening
interest of railroads to withhold rate increases until they can be y
ofj capital accounts. Urges careful
absorbed by shippers and not added to prices.
consideration of New Jersey's proThe stabilization agencies have not had adequate time to com¬
pciseri new banking code.
plete a full analysis of the merits of the railroads' request for a sharp
Lawrence B.
Carey, Commis¬
dous economic pressures
nent
•«*#;
M Chair]man» Board of Governors, fedml E*#*r*o
New Jersey Commissioner of Bank¬ I While urging extension of Price Co&trol At% Mr. t«!fi ««4
ing tells bankers extension of State | alone cannot "hold the line." Deplores wtii tteffifef mi cm*
law giving him power to limit maxi¬ | tailed production due to strikes which, hi »tyi k
mkm*
| try, threatening public safety, and filtering iftlatkn.. Safi frci
mum rates paid by banking insticontrols should be reinforced by aJIocatiiUt aid
»t urn:*
tuitons is based on large bank| materials and condemns minority pressure groups actkg m
holdings of * Government bonds,
overabundance of mortgage money | gard of public interest.
Though asserting it is not the policy of stabilization agencies arbi¬
trarily to oppose price or rate increases indiscriminately, Mr. Bowles
Urges delay in granting railroad rate increases because of tremen¬
and
*f
*,
Strikes Intensifying
Inflationary Force*
Carey Defends
Present Position of
*
CHRONICLE
COMMERCIAL & FINANCIAL
THE
has
no
.place
.
i
'f rCs.
:i It
i €
I '.N:
Necessary as;
:
:
® m;
s.-t uU
■-
If:
'itancUlauptv.r i
not
be'jr.?,*
this
tiif.
t
la .' enough I-.L
•
tv.ff
e
!
c-fh*
if
whether we Neither- th11 nor
♦
If we dcalmg with
:#.j|
Tr■ -w
lose, no one can tell what may can succeed -ur.
o"'Vf de?#i
happen. Plans for economic sta* production without fx
t f- > %: i f$
bility, for peace and progress at There Is r.o othrr
home or abroad would become battle igiipgf foJV?" "Vt " f fv^4{
U %'■■■$■ i&||
Failure to
blueprints of a lost cause.
Today the armies of production source: of .;the. tia.f p- _++i
in many'fields have quit. Others Lvjf nttt:
threaten to quit. The danger js actual and
W rfj
real and time is running out. We
Idly reduced
a* to V-e
decide
levels—-will
win
'
struggle.
lose this
or
'
by Mr. Eccles be¬
Banking and Cur*
Committee, May 8, 1946.
*A statement
able balance
rency
A Reunited
•( sit
» »■■■■
wrii'■# >
$$c-■;4ty.tf
vices,- damage
Senate
fore
t
m
'fit*
41
tabor and Congress
vittaxnmivs*
American Federation
By
President,
t*
failure of labor ®«it***§W
mi alvi |
cafes AFL members urge upon Congressmen tbt pttitft tl
I
|EIIender-Taft bousing bill, (be ntwmmmnm mm mtuwtn
Idefeat of Case anti-labor bill. Holds Congmiteil
#|
Southern Democrats and "reactionary Repefelkass* k im It ClOf |
Apolitical action on a partisan basis, and call* lot a nmmi hk%
movement under AFL
!n Asheville, N. C» aJJresi be trfts ctt«
sade to organize Southern labor and ig&i® atfaclif CiO *
I
Mr. Green recounts
$2,000,000
Western
mi
Maryland Railway Company
1)4% Equipment
|
Trust Certificates, Series J
(PHILADELPHIA PLAN)
To be due
annually £200,000 on. each
movement as
June 15, 1947 to 1956, inclusive
ment by
the
.
To be guaranteed unconditionally as
to principal and dividends
by Western Maryland
Railway Company.
by endorsement
the
will
by
are to
people of f
United
be issued under an Agreement to be dated as of June
15,1946 which
£2,000,000 principal amount of Certificates to be secured
standard-gauge railroad equipment, estimated to cost approximately £2,600,000,
tpimsibHiUcf
most
members
o
1947
f
ike
House
1948
1949
1.30
1952
1.70
the
1956
1,55
1953
one
1955
1.50
1.50
1951
1.15
1.65%
1.75
will
1954
1.60
-
be
quired
to
Certificates are subject id authorization by the'Interstate Commerce Commission. The
Circular may be obtained in any State in uihichthis announcement is circulatedfrom only such xf'the:
undersigned and other dealers as may laufully offer these securities in such State.
Issuance and sale of these
1
HALSEY, STUART & CO. inc.
'
jj" ?*
^
^
*
''r
'
/ \
!
» *"•v ,
«
% *1 v
election.
and
us,.
MICHIGAN CORPORATION
FT RST OF
F. S. YANTIS & CO.
V
Gre«a
they have de¬
judge whether
served reelection.
to
under the in¬
THOMAS & COMPANY
and with a
for
assure victory,
spiration of patriotism
united
¥
William
In the war years,
JULIEN COLLINS & COMPANY
public opinion calling
everp sacrifice to
incorporated
■■i'p-.-'.i
Principal and semi-annual dividends (June 15 and December 15) payable in New York City. *
form in the denomination of $1,000, registerable as to principal. Not redeemable prior to
maturity. 1 nese Certificates are offered for delivery when, as and if received by us. It is expected that Certificates in
temporally or definitive lorm will be ready for delivery in New York City on or about June 25. 1946. '1 he information
contained herein has been carefully compiled from sources considered reliable and while not guaranteed as to complete/"■... ness or accuracy, we believe it to be correct as of this date.
■
To be dated June IS, 1946.
Definitive Certificates in coupon
May 15, 1946.
I.;.-..
;".r
-
t-
;rv
*An address by
fore the
ican
Mr. Green be¬
Convention of the Amer¬
Federation of Labor,
Phila¬
delphia, Pa., May 8, 1946, followed
by an address at Asheville, N. C.,
before the Southern Labor Con¬
ference, May 10,
*'
•
m**#**
f
1946.
tionat
m tkf:
kfn#
law
painstaking tffoft ty
can
frtntp
jer-ta?J* of!-'*
of »»*c tPf t
which were
11
i n r.
of good government
and the national welfare, to study
carefully the record made by our
representatives in Congress and
(incorporated)
ft
fif
¥.h;.r%
economic
working
therefore,
1
m
rmnnMrrt-l
measure*
k'Xki1
in
fa**
ly sought to tietfrv? the
go
the
behooves
I-**
rt
balky
groups
the interests
PUTNAM & CO.
ALEX. BROWN &. SONS
OTIS &, CO.
k'v
Offering
'.If
To make ma Hers
people for re¬
:u+
a
the traces m
—
re¬
to
back
war
of
third
Senate
»r
Lira
budge on a
Represen¬
tatives
and
1.40%
1950
1.05%
Hi-if§
i?
■*.t t
charge t
In the fsekl ct €■>
articuiarlv. C&nz
of
MATURITIES AND YIELDS
—4
mark able
Congress—the
entire
if
ut
*
But finre lie
This
Fall,
at
the. taw
Cohgft** intmm
'
States to Con¬
provide for the issuance of
new
But men make
laws, not by men.
gress.
These Certificates
dual and Communistic.
democracy is frequently
Our American
Federal'.»#«•'
right row, our
j **| I
of (Up¬ / /
4 »t F
.
gaged in au attemptrJ
ing raid tm U--e pKki-f,
every
Amrtwunw
which hi
I
bill
Mi
thf
lhotkir.;h
#:r
h-ii
6
ta \
refer, ct
passed t-y the
resentativei.
Thv-s
i
amendments
the
and
undoubted I:>
living to rise «*'a
It w-c.u
year.
mediate
IntUUm
ity
fv."? r
the f
jri
%i
the?
t
*-vr"
It w ot.it
m far around the ca?
(CorddiiUcd Ui V'&f $
press torn
di p
rtf'i
effect!* cres-
|
p
FINANCIAL CHRONICLE
&
THE COMMERCIAL
2652
Present Position ot
Strikes
Carey Defends
Stabilization Program Restriction on
-7
BOWLES*"'
Interest Rates
|l;|27By
arbi- |
Though asserting it is not the policy of stabilization agencies
trarily to oppose price or rate increases indiscriminately, Mr. Bowles
urges delay in granting railroad rate increases because of tremendous economic pressures working toward inflation.
Analyzes posi¬
tion of stabilization program, which, in view of heavier consumer
and business expenditures and backlog of consumer demands, he
says is "in a state of precarious balance."
Holds it will be in best
interest of railroads to withhold rate increases until they can be
a
position
7 recently
granted wage
railroad
$9"
ations
(l
11 5
,
During the
■
not,
or
if an
essary,
Bowles
Chester
do
we
hot know what would be the
V-J
increase
that
feel
We
such
decisions must be made upon the
*Statement by Mr.
Bowles be¬
Interstate
Commerce
Parte
Ex
and
May 7, 1946.
.
be
paid by
i n -
banking
stitutions
savings
period, to
price
demand
consumer
no
f 1
o n
and
d
e
off
t i
a
forces
the
Marriner
S. Ecclea
than
more
block
o
jury
in-
has
until
Production—
lose this struggle.
or
average
that
interest
maximum
*
could be paid had been
If we
A statement by
prices rose "25% from
August, 1939 to V-J Day and 3%
(Continued on page 2654)
^etitntiors."
bank:"rf
(Continued
Mr.
It
with inflationary effects
succeed unless we reach full
can
production without further delay.
There is no other way to win this
battle against
Failure
source
If
inflationary forces.
the chief
to produce is
of the danger.
money
our enormous
supply*
potential, could be rap¬
idly reduced so as to be in reason¬
able balance with goods and ser¬
actual and
Mr. Eccles be¬
country re2678)
vices, damage to the
(Continued on page
Carey
2699)
on page
right.
place in a democracy.
no
dealing
helpful to
fore Senate Banking and Cur¬
a
substantial degree in rebuild¬
ing depleted capital accounts of rency Committee, May 8, 1946.
wholesale in¬
of
the
of
a
extend the Price Control Act un¬
highest possible sustainable
levels—rwill, decide whether we
win
such
hampered and with adequate fi¬
nancial support, the public should
not be misled into thinking that
this is enough to hold the line.
Neither this nor other devices for
at the
-
assume
Necessary as I believe it is to
of
production are
fully mobi¬
lized and in action.
our
public.
general
the
upon
Dictators
nary
armies
or
systems t h r e a t e n s the public |
safety. No group, no leaders, ever
have the right to inflict such in¬
do
Laurence B. Carey
dustrial
168,
<
..
est which may
had much
war
inter¬
can
industries
prostrates-key
transportation and communication
At best
they
the maximum
of
tween
t s
ceed.
Commis¬
rate
we
ex¬
sioner to limit
-
Stabilization
war
the
Day,
The
Commission in connection with Ex
148
'
six years after World War I began,
when the cost of living rose 108%.
'
Parte
'7 i ( 7 *
'VY' )?■
e n
lose, no one can tell what may
posits. In his
happen. Plans for economic sta¬
address, Mr *
bility, for, peace and progress at
May,
1943, following President Carey stated that "the opposition
home or abroad would become
Roosevelt's Hold-the-Line Order, to the bill centered primarily in
several;; savings banks and they blueprints of a lost cause.
to V-J Day was only 3 % .Even
Today the armies of production
when we allow for deterioration exercised their sovereign rights
in many'fields have quit. Others
in the quality of certain types of, and launched a vigorous campaign
threaten to quit. The danger is
goods, this record is vastly better which almost defeated the bill."
real and time is running out. We
"While admitting that the control
than the one we achieved in the
nately at all times and in all cir¬
the
.
Department of Labor
increased 31%. The increase from
policy of the stabiliza¬
tion agencies arbitrarily to oppose
price or rate increases indiscrimi¬
cumstances.
7 v
index of the
it is not the
fore
,
mini¬ beginning of the
required at this
time.
I should like to make it
clear at the outset, however, that
mum
v
greater
success
in
stabilizing
prices than most people dared to
hope.
• Fronf, August, -1939,
the
in¬
is nec¬
crease
"'*r
critical
cannot,
alone, suc¬
another year
the power of
the
m
among
others. In this
period, violent strife be¬
labor and management that
mobiles,
they
for
tending
this
take
force
-the
law
state
Successful
increase neces¬
and
*
Wartime Price
make such an
sary
defended
last line
a
defense.
Without rein¬
May I ' 11,
on
itself, so that
may
of
at
City,
Atlantic
position into account in making
its present decision.
affecting
p e r
Commission
the
the other fac¬
tors
are
.Association
Bankers
Jersey
position of; the
general
present
stabilization program
and
oned or hope-^
—
lessly crippled have already lost too much time
now.
At best,
because of- paralysis of vital in¬
however, they dustry—coal, steel, lumber, auto¬
B.
Carey, Commis¬
Banking and Insurance of
Jersey, in addressing the New
thing I can do is to outline the
ful
:•
tion.
sioner of
the
of
merits
the
approaching the crucial stages in the war on infla¬
It is futile to talk about winning if price controls are aband¬
Lawrence
at
present case, I think the most use¬
the
increase
of
.view
own
to
Urges careful
Jersey's pro¬
,
,
The country is
banking code.
posed new
have not developed our
we
,
strengthening
consideration of New
New
Since
not yet in
know whether
o
and need of further
hand.
We
rates.
of
are
bonds,
Government
of capital accounts.
of the particular cases
merits
'
;
overabundance of mortgage money
perma¬
increase
nent
of
holdings
railroads' request for a sharp
plete a full analysis of the merits of the
and
law giving
had adequate time to com¬
stabilization agencies have not
The
him power to limit maxi¬
mum rates paid
by banking instituitons is based on large bank-
Syste^
Wtile urging extension of Price Control Act, Mr. Eccles warns it 7
alone cannot "bold the tine." Deplores work stoppages and cur¬
tailed production due to strikes which, be says is paralyzing industry, threatening public safety, and fostering inflation; Says price 7
controls should be reinforced by allocations and rationing of scarce
materials and condemns minority pressure groups acting in dure- I
gard of public interest.
•
of State
ing tells bankers extension
|
and not added to prices.
absorbed by shippers
Jersey Commissioner of Bank¬
New
MARRINER S. ECCLES*
Chairman, Board^ of Governors,^ Federal Reseiye
;
Economic Stabilization Director
■
Intensifying
f
7
Inflationary Forces
1
By CHESTER
"V
' Thursday, May 16, 1946
:
•
Congress
A Reunited Labor and
By WILLIAM GREEN*
Federation of Labor
President, American
labor measures in Congress and advo¬
cates AFL members urge upon Congressmen tbe passage of WagnerEHender-Taft housing bi\\> the new minimum wage measures and
defeat of Case anti-labor bill*
Holds Congressional coalition of
Southern Democrats and "reactionary Republicans" is duo to CIO ®
Mr. Green recounts failure of
$2,000,000
Western
Maryland Railway Company
partisan basis, and calls for a reunited labor
movement under AFL.
In Asheville, N. C., address he urges erasade to organize Southern labor and again attacks CIO's rival
political action
1H% Equipment Trust Certificates, Series J
(PHILADELPHIA PLAN)
f
V
y
1
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f
1
%
'
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t 7
f
j,
1'■* *j
*7
To be
f \S
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To be due
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annually $200,000
f
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each June 15, 1947 to 1956, inclusive
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to
be issued under
United
Fall,
members
o
of
MATURITIES AND YIELDS
1954
1.65%
one
1951
1.50
1955
1.70
the
1952
1.55
1956
1.75
will
1953
1.60
1948
*
1.15
1949
.
1950
1.30
f
particularly,
like
-
and
third
be
quired
by the Interstate Commerce Commission. The Offering
Circular may be obtained in any State in which this announcement is circulatedfrom only such aj the" "
"
undersigned and other dealers as may lawfully offer these securities in such State,
and
Green
in
the Interests of good government
and the national
OTIS & CO.
ALEX. BROWN
& SONS
welfare, to study
carefully the record made by our
HALSEY, STUART & CO. INC.
representatives in Congress and
to judge whether they have de¬
PUTNAM
& CO.
J;
served reelection.
.
FIRST OF MICHIGAN CORPORATION
In the
united
F. S. YANTIS & CO.
5
THOMAS &. COMPANY
every
INCORPORATED
war years,
under the in¬
spiration of patriotism and with a
public opinion calling for
sacrifice to assure victory,
of our ; people
established in the na¬
after long years of
masses
were
tional
law
painstaking effort by the Ameri¬
can
Federation of Labor.
Ana*
right now, our
lawmakers are en¬
gaged in an attempted profiteer¬
ing raid on the pocketbooks of
every
American
wage
earner
which is shockingly reprehensible.
I
(INCORPORATED)
JULIEN COLLINS & COMPANY
refer, of course, to
To be dated June IS. 1946. Principal and semi-annual dividends (June IS and December 15) payable in New York City.
Definitive Certificates in coupon form in the denomination of $1,000, registerable as to principal. Net redeemable prior to
maturity. These Certificates are offered for
delivery when, as and if received by us. it is expected that Certificates in
temporary or definitive form will be ready for delivery in New York City on or about June 25,1946. '1 be information
contained herein has been carefully compiled from sources considered reliable and while not guaranteed as to complete¬
ness or accuracy, we believe it to be correct as of this date.
,
May 15, 1946.
...
-v..
;>
address by Mr.
Green be¬
fore the Convention of the Amer¬
ican
Federation
of Labor, Phila¬
delphia, Pa., May 8, 1946, followed
by
an
before
address at Asheville, N. C.,
the Southern Labor Con¬
ference, May 10,1946.
the OPA
by the House of Rep¬
resentatives.
This bill contains
amendments which would destroy
bill passed
the
effectiveness of
and undoubtedly
* An
-
repeated¬
the freedoms
safeguards of the
economic
which
us,
therefore,
over
' 77*
matters worse, strong
.
in Congress have
working
William
behooves
post¬
ly sought to destroy
go
people for re¬
election. Mi 11
Issuance and sale of these Certificates are subject to authorization
make
groups
the
to
back
To
—
re¬
to
Congress has actedl
mule, refusing to
the traces on others.
of
Senate
balky
a
budge on a number of vital
war
measures
and kicking
Represen¬
1.40%
1.05%
sponsibilities almost brilliantly.
But since the war ended, a re^
taken place.
In the field of domestic affairs?
House
tatives
to its re¬
markable change has
Congress—the
entire
1947
Congress measured up
This
most
gress.
an
"
—
—
i
States to Con¬
7
Agreement to be dated as of June 1$, 1946 which
will provide for the issuance of $2,000,000 principal amount of Certificates to be secured
by new standard-gauge railroad equipment, estimated to cost approximately $2,600,000.
*]Che$e Certificates are
'
*
\fuj* 's\i
r
people of
the
guaranteed unconditionally as to principal and dividends by endorsement
by Western Maryland Railway Company.
frequently described as a Govern¬
make the lawsr—men elected by
ment by laws, not by men. v But men
<7
^
dual and Communistic.
Our American democracy is
~
r
as
•
on a
living to rise
a
mediate
another 50% within
It would
year.
price control
force the cost of
guarantee im¬
eventual de¬
inflation and
drive prosper¬
around the corner that
(Continued on page 2686) s .
pression.
ity so far
It would
-■•':: *•• !--.V *;
ir^v.r-^v's
Volume 163
~ "vfr7, y-fy: ;:^
^V
fl
Number 4490
••
V
:V
••
•.•;,,vi;:>J.. * *•^H-'r. \"
•
•-m«
U,':v
Monetary Agreement
!
Restricts transfers of
j
capital, but provides for amendments in event either government
should adhere to a general international monetary agreement
Agreement is for two years, and is subject to review or adjustment
;
Joining g*
Law Partnership
Goldstein
L i
Despite the British adherence to the Bretton Woods Agreement
the terms imposed by the pending Anglo-American Financial
Agreement,
Great
Britain and^
Portugal on April 16 entered into authorized on the markets which
a bilateral monetary agreement in
they control.
of the
cur¬
nations
two
t
e u
e
ARTICLE
was
2;,:F'FS^
of
nant
Bar and
'•
the
is
the
At¬
Century Associates,
Waldman, sustaining the
constitutionality of the New York
Inc.
of the
under
former
Law
two
editors
The Niagara Falls Power Com¬
State
stein, in ac¬
cepting :th e
nation,
In
closing the Attorney General
(a) against escudos to be credited
partment of Law during my re¬
gime must be shared with him.
Hahn, argued before the United
States Supreme Court, .upholding
previous arrange¬
ments, made by Britain with other
countries, provides for restrictions
of payments outside the Sterling
Area and for adjustments, as well
for
as
in
review of the agreement
a
the
of
either
that
event
the
to
the
at
Monetary agreement between the
of
Britain
Great
Northern
and
the
of
as
Solicitor Gen¬
eral. The Bench and the Bar have
been
unanimous
in
their
London, 16th April, 1946
credit has
come
and
of the other part,
follows:—
States
concerning
the
as, an
credit, of
have agreed as
the
of
Bank
Company to the State of
rental fixed at
$1,100,000
500
Matter of Fay, in support of the
Su¬
Court and in the Court of
constitutionality
tive
1943. The
vor
of
the
Reapportionment
Court's
the
of
marked
Legisla¬
Act
decision
State
the' first
in
that
£
sterling shall be 100 escudos= £1.
reapportionment
1
merits."
-
.
.act
-
on
' '
„
„
NEW ISSUES
May 16,1946
(ii) The Bank of Portugal (act¬
(hereinafter re¬
ing as agents of the Portuguese
Government) shall sell escudos to
the Bank of England (acting as
agents of the Government of the
United Kingdom) as may be re¬
tween
(ii) This rate
ferred to
shall
not
official rate")
"the
as
varied
be
the
and
escudo
the
by either of
the Contracting Governments ex¬
cept after giving to the other as
much notice as may be practicable.
(iii) In all territories where
they have jurisdiction the Con¬
tracting Governments shall en¬
force the: use of the official rate
as the basis of all transactions in¬
volving
a
Illinois Power Company
§45,000,000
First
quired for payments which resi¬
Mortgage Bonds, '2%%Series due 1976
Dated March 1, 1946
dents of the sterling area are per¬
Due March 1,1976
mitted, under the exchange regu¬
in force
lations
in
that
area,
Price 10 2.54% and accrued interest
to
make
to residents of the Portu¬
guese
monetary area—
relationship between the (a) against.sterling to be credited
two currencies,
at the official rate to the
(iv) The Bank of England and
the Bank of Portugal, as agents of
their
respective
Governments,
shall fix by mutual agreement the
maximum spread above or below
of
official
rate
which
be
will
§9,000,000
-
'
the
Bank
Portugal's No. 1 Account
with the Bank of England
provided
that the balance
standing to the credit of that
Account is not thereby in(Continued on page 2677)
Sinking Fund Debentures, 2H% due 1966
Dated March 1, 1946
;-.v f
"■
.
"
■%
This is under
sale*,
no
circumstances to be construed as an
or as an
Due March 1,1966
J '
v
''
<u;
,
t '•!
r
i
offer to buyr or as a solicitation of an offer to buy, any of such
The offer is made only by means of the Prospectus.
%
■
9 If
t
The First Boston
City Fire and Marine
*■'y " '
f
'
i
**]'
,
:
V
' "'x
5
■
Eastman, Dillon & Co.
Blyth & Co., Inc.
Company
*
'V ,v
Copies of the Prospectus may be obtained from any of the several under¬
V
,
' ,v{ >
writers only in States in which such underwriters are qualified to act as
dealers in securities and in which such Prospectus maf legally be distributed.
•
'&
50,000 Shares
,fj
v'*i' j
' V'A
*
v
Insurance
\
Price 101.54% and accrued interest
May 15,1946
NEW ISSUE
:
1
t
offering of these securities fo
securities.
Kansas
,
Harriman
*
«•'
Common Stock
Mellon Securities
'
-hi
Corporation
Glore, Forgan & Co.
Goldman, Sachs & Co.
Lehman Brothers
Kidder, Peabody & Co.
Ripley & Co,
Incorporated
* '
_
'■
.
Stone & Webster Securities Corporation
Corporation
,
Union Securities
(| 10 par value)
Merrill
A
portion of these shares is being offered by the several Underwriters at
expiration, on May 24,1946, of the subscription
rights with respect thereto granted by the Company to its stockholders.
f
'
1'
t
1
f
i
1
K
*
>
*'
1
.
u
/
siv
'
Central Republic Company
(Incorporated)
I
^ r
^
V
V
1
v
SJpencer Trask & Co.
E. H. Rollins & Sons
Incorporated
Coffin & Burr
'
(Jncbrporated)
F. S. Moseley & Co.
Lynch, Pierce, Fenner & Beane
Paine, Webber, Jackson & Curtis
$22 per share prior to the
Harris, Hall & Company
White, Weld & Co.
Corporation
Hallgarten & Co.
Hornblower & Weeks
Incorporated
,
W. E. Hutton & Co.
R. W. Pressprich & Co.
Tucker, Anthony & Co.
Dominick & Dominick
Copies cf the Prospectus may be obtained from ahyfif* the several, under*
only in States in which such underwriters are qualified, to act as
dealers in securities and in which such Prospectus may legally be distributed.
Hemphill, Noyes & Co,
Laurence M. Marks & Co.
writers
First of Michigan'Corporation
G. H. Walker & Co.
Auchincloss, Parker & Redpath
,
4
.
The First Boston Corporation
Stern Brothers
& Co.
Starkweather & Co.
•
-
Barret, Fitch & Co., Inc.
••
1
R. L.
Laird, Bissell & Meeds
Stein Bros. & Boyce
Day & Co.
;
J
Putnam & Co.
j; Chas. W. Scranton & Co.
George D. B. Bonbright & Co.
.
of
fa¬
case
the
Court of Appeals had sustained a
Portugal amounts to
million escudos, against
gold to be set aside in the
of England's name at
the Bank of Portugal, Lisbon.
in
this
time
Eng¬
Bank
(i) The rate of exchange be¬
a
per year.
Bank of
ARTICLE 1.
im¬
public
under no circumstances to be construed
offer to sell, or a solicitation of an offer to buy, any of these securities.
The offer is made only by means of the Prospectus.
■
land's No, 1 Account with the
Britain
Great
United
a
far-reaching
This advertisement appears as a matter of record only and is not, and is
M 500 million escudos, or
(b) if the balance standing to the
of
What¬
1 Ac¬
Northern Ireland, of the one part,
and the Portuguese Government,
Kingdom
com¬
mendation of his service.
ever
Power
Appeals, in addition to numerous
cases in the. other appellate and
trial courts. Among them were:
People v. Mailman, sustaining
the right of a State to penalize
Orrin G. Judd
his achievements
the
in
preme
the
gal, provided that the balance
standing to the credit of that
Account is not thereby in¬
creased above a maximum of
Portuguese Government.
The Government of the United
peals
people of the
brilliance
.V-V\V;;K
General, Mr. Judd
argued most of the important ap¬
the gratitude of the
for
.?;/
"As Solicitor
has
State
■
.
a
count .with the Bank of Portu¬
and
Ireland
the
to
rate
Bank of England's NO.
Government of the United King¬
dom
official
said:
Judd
controversy
resulting in the payment by the
The text of the treaty follows.
similar
"
"Mr.
Ni¬
interest in navigable streams and
violations of OPA ceilings.
East New York Savings Bank v,
in
as
ing
the
purposes.
establishing
a
old,
of
portance
to the De¬
escudos
Portuguese
power
terminated
century
principle
from
water
This
contracting governments "adhere
a general international mone¬
tary agreement,"
100
of
a
charge for the
a
River for
half
Review
said:
at
impose
diversion
join together, i By
their outstanding public service,
they have earned the confidence
and gratitude of the community."
General Gold¬
to
agara
Harvard
the
involving the right of
pany case,
and
classmates
of
v.
Commercial Rent Laws.
Governor
(i) The Bank of England (act¬
as agents of the Government
of the United Kingdom) shall sell
sterling to the Bank of Portugal
(acting as agents of the Portu¬
guese Government) as may be re¬
quired for payments which resi¬
dents of the Portuguese monetary
area are permitted, under the exChange regulations in force in that
area, to make to residents of the
sterling area—
fixed
to the £. The terms of the treaty,
constitutionality of the 1943
continuing the moratorium
mortgage foreclosures.
..Twentieth
one
trial lawyers at the
formerly Chief of the
Bureau
these
see
<
i g
record
Dewey, and has recently returned
over two years abroad where
he served as Chief of Intelligence
of the Psychological Warfare Di¬
vision of SHAEF. I am happy to
Attorney
r e s
a:
from
York
"
Gurfein
was
Rackets
Mur¬
New
made
on
outstanding
Orrin
I. Gurfein
City.
indeed
"Colonel
ship 4W ith
j
and
rencies
that
announces
has
2653
v In
further comment,
torney General said:
law partner¬
Colonel
which the official rate of the
/•
•
statute
Attorney General Nathaniel L.
-
ray
'
'•
• •■
which will be difficult to equal."
G. Judd has resigned as Solicitor
General of the State to form a
after mutual consultation.
>
He
Orrin Judd
The Anglo-Portuguese
Fixes official rate of escuda at 100 to £.
'■!'■■ "•
:;"/,••••
.' THE COMMERCIAL & FINANCIAL CHRONICLE
,
Reynolds & Co.
the
THE COMMERCIAL & FINANCIAL CHRONICLE
2654
Thursday, May 16y 1946
ever,/ there is evidence that these
•
limits
in many cases still
are
high level operations. Distributors'
(Continued from page 2652)
;; I prices, which shot up; by
60 to mediate market for shirts, for ex¬ inventories, unquestionably; are
from May, 194$. The larger figure 65% since thb Spring of 1940, have ample, is estimated at 320,000,000 still depleted.
:
If we weaken our resistance to
compares with a total increase of I risen by another 15 to 23% since against a production level of 160*-165% in the six-year period after September* 1945 alone. 000,000 before the war. The mar¬ these forces* that weakening, will
Farm land values have gone up ket - for men's suits is at least give rise to: further inflationary
July, 1914.
'•
We also
achieved far greater 69%
since March, 1940 and are 4ft million/ a year against a pre- forces* • IFIs Sometimes- said that
there is n& sense im restricting
stability in the actual cost of an climbing rapidly now.
Since V-J: war output of 21 million.^ J
;
-
hour's labor, as measured by aver¬
3939
to
V-J
Day
from May, 1943 to
7%.
For
class
I
was
shot up more. than
These increases
64%y and
V-J Day it was
railroads,
earnings
rose
20%.
/
i_."'
' :
/.
'v* V. "\'y\
;!I'/t
the total of
that
civilian
for
attest
Consumer
,
stocks' of
ly"
almost all
current
goods
based
demand
real,
on
The most acute of
needs
;
Maintained
The stability
which we achieved
during this war has been main¬
tained in peace fairly successfully
may
some
ize.
::
-
■
we are still in mid-passage
and could easily be wrecked, be¬
ahead,
We are now
crucial period of the
fore we make port.
in the most
transition
to
which we are
safety
economic
trying to make.
less food for
our enormous
animal
During the dirst three quarters population, that we shall have to
1945, consumer expenditures reduce animal numbers in this,
were at an average annual rate country. This means smaller/,sup¬
of $103 billion. In the fourth quar- plies of some foods than we would
ter—the first full ^quarter" after like and continuing upward pres¬
V-J Day—they rose to $111 bil¬ sure on prices.
/
lion.
In the first quarter of 1946,
Current Business Demand ?
they- are
estimated
to
have
reached an ahnuah. rate of $120 <
Current business demand paral¬
billion. This increase has occurred lels the intensity of consumer de¬
before the major consumer durable mand and business has 80 billions
goods have become available and of liquid assets, easily a record
represents
m a i n 1 y
increased volume. Producers have been add¬
spending'for food and clothing.
ing heavily, to their plant and,
of
.
Tremendous
While the
Economic
Pressures
underlying economic
pressures making for inflation, as
distinguished from speculative and
other psychological pressures, are
gradually lessening, they are still
tremendous, and they are greater
than we had expected to encoun¬
We know that current consumer equipment and to inventories; of
ter. If we are to overcome them,
raw*
materials
and
goods
in
we
cannot afford to weaken our needs- are abnormally high, and
that -liquid funds available for process.
resistance.
- '*
Business spending' has reflected i
spending are enormous—$145 Mil¬
The economic as well
tas
the
psychological factors making for
inflation are clearly shown in the
markets in which prices are un¬
controlled. v Current
commercial
more
increases^ in
rents run from 30 to
than 100% . Urban
real estate
deferred,/demanids and forward
alone at the end of 1945. Millions buying as well as buying to meet
of returning veterans have had to heavy
current § requirements.
in the
lions
from
start
hands
scratch
of
or
near
it
to /Manufacturers' inventories of ma¬
terials and parts appear to
been built up substantially.
A general
belief that prices are
going to rise would create grave
danger that manufacturers and
distributors
would
inventories
seek
build,
to
reasonable
above
these
;
(Par Value $25 per Share with Stock Purchase WarPurchase of Common Stock Attached)
rants for the
v-.
that already exist
one
The con¬
too, would speed up his
purchases if he thought prices
were
going to .rise.
Instead of
holding on to his liquid funds, he
would want to spend them before
their purchasing power declined.
A general speculative or protec¬
tive*. effort to turn." liquid assets
into goods at a time when the
-supply of goods is inadequate to
meet even real needs, would/spell
disaster for the economy.
second major
The
May 10, 1946.
INC.
£> Co.
* \
;
underlying supply^
relationships,
difficulties
also
but
on
why
reason
price increases breedTurther;i>rice
the
both
supply-
upward
price pressures weaken.
*
V
;
i'C
"*,*'*
J
Program in Sta<te of Precarious
Balance
So long as
these pressures con¬
tinue, the/stebiiizatf
in: a
state of very
.
balance.
tinued
precarious
.
It is essential for its con¬
success
that
requests
for
price a lid' rate increases, in what¬
ever area of the economy* be ex¬
amined to the fullest extent pos?
sible without actual interference
with
the necessary production of
essential
increases is that many of our ceil¬
that
goods and services, and
necessity for: such in¬
the
be; Clearly
creases
This
is
e^obHshed.:
true be?
commodities and cause if we can weather the
ceilings on b&sic
present critical" period of the
food /products are tied to the
transition the;prospects/are bright
ings
our
prices farmers pay through^ the
parity provisions of ther stabiliza¬
tion laws;
If the prices; that
farmers pay" are raised,
farm
many
also
must
ing year. When this relaxation
ceilings on takes place* price readjustments
products can be made, without damage to
food
and
raised.
be
third major reason i9
for
demands
in¬
strike
We are' just completing
round of major readjustments in
When
furtherwage
creases.
a
for. a'/generaLrhlaxatiOn/ihf la^
tionary pressures during the com¬
the
ecpnomy, which just no\y
that might' be disastrous.
rising cost of living gives rise to
Until the effects of the coal
The
a
particularly
farm
on
therefore
were
duction
felt, total civilian pro¬
at. record
levels.
was
the
strike
is.
basic wage rates.
settled,
In view of thq upswing in production will
effectiveness with
which basic resumed.
Thus far* however,
wage rates were held down during increase in
the war, in view also of the; fact
that many of the elements, in gross
weekly and hourly earnings, such
high paying industries, upgrading,
premiums, and the like,
extra shift
hostilities
after
reversed
were
have ended, a major revision, of basic
How¬ rates was. in order. Now that we
had it, however, the
adjust the
economy
job is
to it.
The Wage-Price Policy
of price
;;
ceilings were laid down
Order 9697, issued
on Feb. 14.
These standards have
been
and
are
being
further
in
Executive
by
the
National
Wage Stabilization Board. While
they are necessarily broader than
those of the wartime executive
they furnish guarantees
price controls are to be ac¬
companied by adequate restric¬
tions and limitations on the wage
and
increases upon the
increases may¬
salary
basis of which price
this
Under
sought.
have
-
"
-
other
.
policy
increases
Some
have
thousands of wage rate
.
created by the
demand
sume#,
be
Blair
under normal
like
Thus/ we have not only the im¬
mediate
and
direct
pressures
•
that
Copies of the Prospectus may be obtained in any State only ~
in this issue as may legally
offer these securities under the securities laws of such State*
look
costs should resistance to
-
add artificial shortages to the real
Orders,
from such dealers participating
will
who have goods would withhold
them.
Thus rising prices would
developed in the course of their
Shares
fully absorbed and be*
know what the cost pic¬
we
demand side and froim the side of
administration
Price $2 5 per
been
the
be
th^
production has been
concentrated in the earlier ..stages
of
the
productive process—in
plant, fa/w materials and 'goods inprocess^ ?
here On;
creasing, proportion of production
will
be
in
the
form
of
finished
goods* available to lake
edge off the most acute of
consumer
the
unsatisfied
consumer
demand. Ak
volume
increases, moreover, and
the supply of goods begins to flotf
more normally, the present bulgb
in production costs will subside;
I think we are doing that and
The economy will then be in a
doing it successfully. Before wage
position to absorb, without serious
and salary increases may be used
effect on prices, increases in costs
as a
basis for-seeking price in¬
which now would create a danger¬
creases, they must be approved for ous tension.
this purpose by the Wage Stabil¬
ization Board or other appropri¬
Importance of Transportation v;
ate agency. Standards for deter¬
Costs
mining whether and to what ex¬
In this connection transporta¬
tent wage increases may be taken
tion costs are especially important.
into account in the determination
Bowser, Inc.
$1.20 Cumulative Preferred Stock
living that would set" off
another major round of wage in?.
creases
before the one just, past
ing speculative profits oh a rising
the same time those
of
200,000 Shares
; i
cost, of
market.' At
-
no
to avoid an > increase in the
; vital
requirements in the hope of mak¬
to
circumstances to be construed as, an offering
securities for sale or as a solicitation of an offer to buy any of such
securities. The offering is made only by the Prospectus,
under
objection to the present
standards of approvability of w&ge
increases.
These standards, how¬
pressures ready to - exert
themselves and' to aggravate the
up
have
This advertisement is not,, and is
So far there has: been no. sub¬
•
stantial
ture
individuals
acquire a wardrobe,
set up
a
household and furnish it. The im¬
fective.-
operating conditions.
ments at first declined, the decline
,
price ceilings is proving to be. ef¬
has
.
Arguments for Curbing
;
From V-J
.
dicates that*the indirect limitation
of wage and salary increases via
fore
While wage
\
a
further rises.
sharp drop in employment whichi fore it is satisfied. Professor Sum¬
ner
H.
Slichter
of
was anticipated did not material¬
Harvard,
and salary pay-; estimates the^backlbg,' demand for
consumer - durable goods alone at
was far less than expected because
$50 billion., In our biggest year,.
employment, after the first drop, 1941, we bought only $10, billion
available,;
the
consumer
price held steady and then increased. worth. It will take 14 million cars
index rose less than 1%.Whole-; Asa result of this increase in em¬ simply to replace those more-than
sale
industrial'prices rose 3% ployment, and the increase in nine years old. The acute demand
from V-J Day to the end of April.
mustering-out pay, income, pay¬ for housing is estimated at 10 mil¬
While basic wage rates in manu? ments to individuals had regained lion homes'vvith a sustained level
facturing
have
risen,:' average their peak war levels by March, of demand around a million and a
hourly earnings in March were 1946.
quarter per year.
still at about V-J Day level and
Everi in the field of foods, Up¬
were
below
the
wartime ^eak, Increased Consumer Expenditures
ward pressure on pricbs is acute.,
Since V-J Day
<
:
'
owing mainly to the reduction of
World shortages of grains result¬
overtime and shifting of many
The most astonishing develop¬
ing partly from the war but ag¬
Workers out of the high paying ment since V-J Day has been the
gravated by unforeseeable lacl£ of
war industries and occupations.
extraordinary increase in consum¬ rains, and in some areas, cyclones
I say that the wartime stability^ er
expenditures, which occurred and tidal waves, have forced u? to.
has been maintained in peace so even while consumer; income was
below the requirements of present
far because I want to emphasize
temporarily declining^ Consum¬ scrape the bottom of our national
that there is no ground whatever ers
are
spending an increasing bin for wheat and corn as well as
for being complacent about the
proportion*of the income they re¬ other basic food products. We have
future. On the contrary* although ceive
and
a
greatly increased to face the fact that this
mejans
we
can see
that -solid land lies number of dollars.
far.
is
be
Day to Marcty
the last date for which a figure is
so
This
While it is true that, price
are. a result of inflationary
pressures,
they are not - merely
that.; They are also* a, cause, of
:
the
This in¬
ever, could not be maintained in
pres-! the face of a serious increase, in
dangerous half- prices and the cost of living. It is
truth,
of these
within
been
approvability;
are mere¬
rises
satisfied
fairly
about
150%
between
1914
and needs, still far exceeds the total quickly. Common knowledge tells
~
.
1920 while in the five years from !of current supply. ~
J us, however, that the backlog of
1939 to 1945 they rose only 33%;, ;. Consumer
for
spendable .. income; need
houses,- automobiles,
continues at $138 billion, which is and other durable; goods is huge
Peacetime Stabilization:
roughly the wartime peak. : The and that it will be a long time be¬
average
of
result of inflationary
a
sures.
the
to
they
price rises because
Backlog of Consumer Demands
goods are low; and distributors'
although grad'ua.'ly
strength of the inflationary pres-; inventories,
sures that permeate the economy.. increasing, are far below the nor¬
The basic fact to be recognized isi mal levels.
';
steam
hourly
•':V
Day, stock prices have risen about
20%, and the price of cotton has
hourly earnings. In the first
"World War period average hourly
earnings in manufacturing rose
149%. The increase from August,
age
have
creases
inventories
Present Position of Stabilization Program
resulted
others
made.
been
in
prices,
been .without
higher
have
many
price
consequences,.' but
information
reaching me from the operating
agencies
indicates
that
a
large
percentage of applications for ap¬
proval
of
wage
and
salary
in¬
They touch every phase/of pro?
duction- and distribution arid add
to cbsts at every level.
As Mri
Porter will testify, increases in
freight rates will in; many cases
require increases in price ceilings.
It is
the
Important to keep in
importance
mini
of the timing
of
any readjustments of freight xatck.
Their effect upon prices win de -
pend
in great part upon
the
margins available for their ab¬
sorption.
I think it probable, as
I have already suggested, that the
margins for absorption indicated
in
the
recent
profit statements
will prove to be
that
we
shall
about the lowest
see
during
the
transition period. Since the second
half of 1945 the gross national
product has been declining. It fell
annual rate of 206"bil¬
lion dollars in the second quarter
to 183 billion in the fourth quar¬
from, an
ter,.
In the first quarter of 1946
;fvv.v'v »i:. i;vWri *.».;?»*;•
."
Y ,i/Y
y,'
WY/
Number 4490
;
annual -rate
portion of
in banking, quarters over
to place- the 25-year debentures., Consensus in such cir¬
major setback
a
Our
rise
to
Reporters
r
be expected to rise quite
generally throughout the econo¬
my, and especially in manufacturmay
irig~ with; resulting improvements
' r
/
'
price adjustments' resulting from
iii
cbnsiderifig, the necessity for the
;
higher freight "rates themselves/
we
are
likely to be unduly im¬
pressed with conditions prevailing
in the months immediately past.
In my opinion any decision that
might require immediate readjust*
rftents
throughout < the economy
should be postponed until we can
get a better perspective oh prices,
costs, and the margins available
for absorption of cost increases. /
as
and
The Interest of the Railroads
With
interest
true
the
of
rail¬
this respect & identical
roads in
of the economy "as a
J f increases in rates which
that
Cbuld be absorbed at a later
hew debentures
out: yesterday. ' » -* - • - •
-
possible slight increase ' in
in
be seriously jeopardized by ;a sub¬
increase in costs at this
;
•
:•
;
such
President
of
Executive
First
the
"*
of
call soon ;for
^'Operation'
000,000 of; new first mortgage
bonds, $5,500,000 Of serial notes
the
Bankers
sometimes
is
AffefAfeA'{A
that
said
""
-•
magnitude
when trans¬
156,308
shares
of: $100
makes
experience
perfectly.; clear,- that
it
added
the
whether
cost
,
for
v
f
Of
new
bidding,
bonds.:
$27,000,000
j
Officers of the Group, in addition i'
It also would bor-
to Mr.
Cochrane, are J. Paul TayBrooklyn Trust; Company,
iVice-Chairman, and: Richard YH.
row: $2J)00,000 front banks.
,
.With such funCte it proposes to
redeem $27^300,f)00 of series D
bonds Which are now outstanding.
Form
.
(Staten* Island) Branch of the Na- ]
Wagner, Gerties Co.
.
pfeifephonpf^; ^Ifegfabh:
jrefihance its $28.701.000 - of twen¬
4V2 %
jrear
jthrough
normal
aralmJ'tafUfes Id be
''
Bank of New
City
Secretary-Treasurer.
In New Location
debentures
channels,
New York City;
Officers
are
co'nstrued&S:
.
the. removal of his offices 10^448
E.. Gerdes, President, and Gerhard
such Wagner, Secretary-Treasurer;
1
Y
Southr Hill Street.
offering of these Securitiesfor sdte,fords an offerfa bug,
an
of such Securities. The offer is' madS only by
any
PY/YYvy
&
"
means
Or as'a- solicitation
of the 'Pro spechis.
t
>
•
1 r-^mAMiAAAAA:
<
Dated
May 1, -1946
if may be divided, the total im¬
Interest
mediate" effect amounts. to hun¬
dreds of millions of dollars;
payable May 1 and November 1
In view of the delicate situation
Price
of the stabilization program-and,
for the reasons I have* outlined, I
100% And VSMtertietl
interest
the Commission to examine;
thoroughly the railroads' need for
permanent
increase
before
granting any rate adjustments ^ at
urge
a
100,000 SWes Cumulative Preferred Stock $3.25 Dividend Series of 1046
'
'
'
•
:
■
■
.
'
-
,
!
!
•!
YY'
.v-
v-,';.
(Without Par Value—Convertible Prior to June 1, 1956)
v
Allen B, Whitney b
Be Gammack Partner
Allen
Whitney,
B.
and accrued dividends from
of
member
May 1, 1946
York Stock Exchange,
the New
Will become
a
partner in the Ex¬
change firth of ;Cammack & Co£
Wall Streets
40
New York^ City,
May 29th., Mr. Whitney5 has
been active as an individual Floor
on
Copies of the Prospectus may be obtainedfrom such of the undersigned as may legally
'toffojcJljcsz. Securities in compliance with, the securities taws of the respective states.
^roKer,
•
.
Fletcher,
Leon
Will
member,
firm
on
the
from "'the
date.'
same
:''"s'
;
•fv.v•
Exchange
Jr.,
retire
'• •'•••'
"•' .ft
——m*
•
i
■-
>
Y *
Eastman, Dillon & Co.
A
••'
j
;
i-fefe
/Y
■
'''
; :
V
;
■
'■■■:":;
'■y'-p'' \
Narfwell Morse Heads
Cohu &
:
Smith, Barney
Torrey Dept.
s"A
yy:
u.''
nounce
that
formerly
has
head
a
joined
of
members of the
Stock
Exchange,
Hartwell
P.
Major in the Air Corps,
the firm's
wholesale
partment.
A' * A
,
.
*
'I A
1 l' ,*j \
f
'L<dl'
*
"Cd*
•■"t*
5"
*
'v
'
^
A-:. ./ :/ y" v':;AA:ri
-r,4
Goldman, Sachs
-AfeAA A fAli-Z&Ar&tfA
1AAA
Y-l^vV; "lf:
Co.
&
'•
V•k'
'<■
| Kidder, Pea body
A fAA '-
;Y.
&
Co.
:V
/:>. •,
as
de¬
-
The First Boston Corporation
Co.
&
*
an¬
Morse,
their «Qrgamza1;ion
Y1
'■
V.Cohu & Torrey, 1 Wall Street,
New York v City,
New..York
?•
v
May 15, 1946.
.
y
'
'
^
;
Y
-
•
j
-
LOS ANGELES, CALIF.—ClarFrank enca Hunter .Staples - announces;
•
all.
1
|
$<&0CO£00,'P» ftl
unit, *,It is nevertheless -felt hnd,
'■
Yorkj
" (
any
commodity is great or small per
dismissed as.negligible. However
f
Crowe, Manager of the Stapleton.
itional
■
y
lor,;
,
I ....
-
of an offer to bug,
'■•r'rfef •' iirsK/'rvK
when' added together, produces
an effect which cannot be*.lightly
j
par
cumulative preferred stock,
Beneficial Industrial Loan Corporation
to the final users. Our
j
At the dinner 1
in*
lated into the cost of commodities
]
the
York
New
the
in transportation costs are
in
Trust
of
session in the evening, George E.
Sokolsky, well known journalist ;
and
foreign correspondent, will 1
:;
Helping to swell the list/Gulf
sneak; on "Civilizations at Wax."
! States Utilities CO., of "Texas, 't
Group Seven consists of banks f
\ has filed with the Commission/ located
in Kings, Queens, Nassau, \
iLor authority to sell,* via' com¬
Suffolk and Richmond Counties,
and
a sub¬
International Telephone
-
of
Bank Credit Pool."
If thebankers had Eeen inclined ■!, Wagner, Gerdes & Co., Inc, will
hoperthat thd gituation market- engage in the: investment business
wise might entice. International
frbfli * offices* at 233 Broadway j
no apparent
Y-Y- *"Y
Vice-'
National
and 'Chairman
a
:
1 .
. •
ty-five
This is under no
increase will
an
''A
It
Mr. Cochrane is
Ex¬
.
rife;/'■>
However, there Was
according to r
John
C.
Cochrane, Chairman of the Group.;
by
•
issues running ap¬
■/
Farmingdale,
announcement
to
below, 2.55% in. yieldbasis, Were not especially feCep- v
five.
Park,
•
absorb
creases
j
preciably,
i
New
Company
stantial reception for both under¬
about 2.48%,
Dealers reported
that the big insurance compa-
steadily/improve iftthembntiis to
small
liihinary inquiry indicated
takings.
j-
} nies, who have been extremely
j
session
meeting of
York State-
President
and the debentures at 101.54. Pre.-
yesterday priced at 98. to yield
particular, juncture, / There are
solid indications, on the Other
hand, that:the^ability of business
to
.
forces fixing the «ame" coupons,
the debentures and'
2%% for
!
Rankers brought the' issue out
irew
annual
GroUpYSeven,
.ap¬
petitive
?
Were fairly close with opposing
|
.
dustrial loan to carry that, coupon.
pone
stantial
lines.
Bids for both.issues
same
the investment market its first in¬
everything possible ib post- ; cool to
the increase. Until it can' be
absorbed.T The stability y of - the
economy in my judgment Would
■
| V/«% for
:
49th
Bankers Association,' which will
be held May 23 at Beth page State'
.
felt, presumably ijiat at a slight
the bonds.
discount, the issue would give a
good account of ; itself.; .Atl .the | The, successful 'group- was
same
time by holding the
rate petted to^^ plhoceed^w
today, pricing the bonds at 102.54
initially fixed, the company gave
damage to the
to do
,
financing disclosed that bankers
j competing for the business were
lhinking: pretty: ptticit. along 'the/'
But a corporation: the size' of
Jersey Standard is unquestionably
proud of its credit standing and
i
then
:
and
having
''Undejr- '
on
afternoon
Bank" and Trust Company of Bay
\
Shore.
;Hugh ,H. McGee,. Vice-;
i
rate3 and
.
of
the
proved the sale of new Securities
Involved in,its projected refinanc¬
ing; Ohio Public Service Co..'is
t
recent weeks.
Securities
Commission
New
Water Resources of Long
at
the
and
of
Split into two issues, $45^)00,^
Bank Credit Group of New York \
bias' ofl the issues" .to be, sold.
".
[000 /new* first /ihortgage bo^dsii
Cityi;-will address the session-on;!
and $9,000,000 of debentures this
The schedule calls for $32,-V
hardening
mild
money
the
Bank
I
the
?
of the transition would do serious
economy now,
the
short-term
/With
change
County
expected to issue
Tuesday.
the let-down in Treasury bonds
In
stage"
it is in the interest of the railroads
of
nizance
New Issue Roster Grows
the
of
Island"
an
new
a
presuttiably to take cog¬
coupon,
of
but bids from only two
groups on
•' - •
There had been sortie talk of
slate
.
brought
;
fair-sized
a
issues coming on the market this
y/eek, the big. refinancing of II ipois Power Co.,; involving $54,*000,000 in new securities, brought
probably exDlains why Standard
Oil Co; (N. J.) stood upat" On its
2%% interest rate for the $85,-
^
ground
Group:
Christ, County At-'/
Nassau
Hyde Park, will speak
V OiiCe
.
With
G.
of
President
'this, operation; is out / of
Quarters, that these organizations
could still t^alize4 llightly bettet' the way the company, doubtless
fate of feturn than is possible in Will proceed "with .plans for re¬
financing an issue of. $43,500,000
comparable, governments. /,
: ;
bf; 5% debentures which it has
;j
Illinois Power Co.
(
*
V--, outstanding.
corporations, as rep¬
resented
by - their officials; are
realy no- different in their tem¬
peraments than individuals/ That
i
Marcus
torney
,
it is natural to want to lead the
parade
Of N. Y. Bankers
ment Of the: issue. "riAAA AAA Ai'A
^
<
j In considering the necessity for 1000,009 of
higher freight ratfes, AS well
.was
pf;the issue.
3 It was: the .contention iti' such.
Report
steadily,. By the
Speakers at Meeting
11
The compafiy is reported giv¬
ing consideration to plans call¬
ing for the* sale of a flew " issue
said, was that some
the major funds, presumably
to a group of insurance com¬
including several of the Rockefelpanies.
Some months ago it
ier" sponsored' foundations,. would
! had given thought to a bank
probably absorb a goodly portion
loan as the medium for retire¬
we may
the total national
production should^be.'substahtially
above present levels.
Productivity,
id profits.
cles, > it
.
hopes appeared to fade this week.
of
eftd of the year
whole.
'..v-
\ r
A:A;AcA'":'-
///:.
••
concern
•
continue
The
V-w.;Y
'A vVvi,'',»V/YV>
>'•«
A^'fAAAAA;^:
ability
confidently expect that when it
tlie volumb. of produce
tibn will regain March levels and
is' settled
:
'• .v'v-.'
'
THE COMMERCIAL & FINANCIAL CHRONICLE
was 182 billion,
during- the quarter the de¬
cline was-reversed, the physical
process of reconverting our plants
and machinery to" the production
of civilian goods has been
prac¬
tically eompletedY; ATthqu^iSthe'
coal stfike Is Assuming .the/ pro*
•
y
•
163
antl
too,
}U\r> <Y;;
} ••Yy:
■
.Volume
the
iVf..-J Ado&•''#i
,■
Harrtman Ripley
Incorporated
&
Y"Y "
Co.
':'-A
Union Securities Corporation
r
'A*?:
'Ari
fflGssmscsffise
||v;^)pi;^;'^\-i'M\
•*a>''*
<A*-*Vjrt:'"V:r
VV-Wf''
1
-nu*W"-
V,j,.">'>-i'i»
' "V"
-,vtf ,.'iiT«(fcv?<(,c;''l.'f,>
THE COMMERCIAL &
>
mki'!.^ V'i '!
'■
'■
*." ,:^fcWV>K ••" •-•'
,"'■'
Pere Marquette
stock holders, the
plain preferred and prior, prefer¬
ence stocks of that road immedi-'
ately pushed
■
.'.-
v.
-
. ••
.
Thursday, May 16, 1946
FINANCIAL CHRONICLE
priori preference.
quette
forward to new 1946 price above
highs. The common stocks of both
roads were also strong in a gen¬
erally desultory rail market, al¬
though neither stock duplicated its
earlier 1946 high.
They
New York Stock Exch.
point out that purely on an invest¬
ment basis it should command a
feature
of
and
the
conversion
a
far from
not
market
Elects New Officers $
To this will be
par.
the -value
added
the
At
present
freedom
New
from
the
annual
York
following officers
danger of call until late 1950.
election
of
the
Exchange
Stock
the
were
elected!
Chairman of the Board of Gov¬
ernors,
for the
Public Utility Securities
term
of " one
the Pere Mar¬
year: John A.
quette prior preference is to re¬
(Continued from page 2650) 1
ceive 1 share of new Chesapeake
Coleman, Ad& Ohio preferred and % share of number of charts of United; Gas' ler,
Coleman
sales
and
revenues & Co.
Chesapeake & Ohio common. The customers,
For the term
plain preferred is to receive 0.8 showing 1938-1945 as "past exper¬
shares of new preferred and 0.4 ience'- and 1946-50 as "company of three years:
forecast." This forecast was ap¬ Richard M.
shares of common. Pere Marquette
parently prepared on an- ultra- Crooks,
common is to receive % share of
Chesapeake & Ohio common. The conservative basis, and before the Thomson &
highly favorable results for early McK inn on;
new preferred will carry a 3%%
1946 became available. They as¬ Robert
dividend and will not be callable
D.
before November 1, 1950 at which sumed that future earings would Danks,
Ernst
time the call price will be 105 plus tend to flatten out—or at least &Co.;William
Under the plan
;
Austin Nicliols
$1.20 Prior Cumulative
Convertible Preferred
New—When Issued
will be convertible into 1.6
Mills, Inc
Arden Farms
Common &
Preferred
:
Chicago Railways
Cons. "A"
5s, 1927
shares
At the close of last week Pere
Marquette prior preference and
preferred ; stocks had retreated
slightiy from the highs established
earlier in the week, to i 126% and
103 %, respectively. Taking Chesa¬
peake & Ohio at its recent price
of 61 %, Pere Marquette prior pre¬
ference reflects a .potential value
of 106% for the new Chesapeake
& Ohio preferred. Similarly the
Pere Marquette reflects a poten¬
tial value of around 98% for the
preferred. It must be borne
that the prior
preference will presumably con¬
tinue to collect its regular 5%
new
in mind, however,
dividend in the interval
summation of the plan
will
preferred
plain
to con¬
while the
not. The
Marquette common is also
selling a couple of points below
its indicated yalue under the plan,
v
Many rail men feel that the new
Chesapeake & Ohio preferred will
sell substantially above the price
of 106% reflected by Pere Mar¬
Pere
TRADING MARKETS—
Magazine Repeating Razor Co*
Universal Match Corp.
Dixie Home Stores
;
5XA«
Missouri Pac. RR. Serial
:
p
L
:
JBM
{
''
jBjk
i
A
I %
■
A
would
from
not
continue
1945
the
to
level,
based on this trend
(as shown in the chart)
would
carry
1950 earnings to
projection
Gardner
line
(St. Louis).
For the term of two years:
ered over a point to 19%.
M National Mallison Fabrics
Van Tuyl & Abbe
72 wall street
i»»"7
-
NEW YORK 5
Teletype
Telephone
HA 2-6622
NY 1-1499
,
Specialists in
RAILROAD
PFLUGFELDER, BAMPTON & RUST
61 Broadway, New York City
TRADING MARKETS IN
SECURITIES
"OLD"
Selected Situations at all Times
Preferreds & Commons
Chi., Rock Island & Pacific
;;
CUARANTEED RAILROAD STOCKS-BONDS
New York 4, N. Y.
Chicago, Indianapolis & Louisville Rwy. Co
1st
"
•:
Telephone BOwling Green 9-6400
Teletype NY 1-1063
at
St. Louis-San Francisco
Duluth, So. Shore & Atlantic
St. Louis Southwestern
Seaboard Air Line
Missouri Pacific
Mortgage Income 4s
Due Jan. 1, 1983
Dated Jan. 1, 1943
Rutland Railroad
Denver & Rio Grande West.
$250,000
25 Broad Street
Old Colony Railroad
Chi., Milw., St. Paul & Pac*
change
prior sale and
We offer subject to
& Hartford
N. Y., New Haven
101% flat
N.
Y., Ontario & Western
^
Western Pacific
Wisconsin Central
(when issued)
G. A. Saxton & Co.,
SUTRO BROS. & CO.
^ v',
Textiles, Inc
*
120
,
,
Exchange
BROADWAY, NEW YORK 5, N. Y.
Telephone REctor 2-7340
Members New York Stock
70 Pine Street,
Inc.
New York 5, N. Y.
Teletype NY 1-609
WHitehall 4-4970
Lehigh Valley Railroad
CHERRY RIVET CO.
General and Consolidated
GETCHELL MINE, INC.
,
4s4^j-5s, 2003
Circular Upon Request
UNITED PUBLIC SERVICE
Adams & Peck
63 Wall Street, New York 5
<Owllng Green 9-8120
<O0ton
Tele. NY 1-724
Philadelphia
■
Hartford
Mclaughlin, reuss & co.
UNITED PUBLIC UTILITIES
Members New York
co
Member of National Association
of Securities Dealers, Inc.
TEL. HANOVER 2-1355s
52 wall
street
HAnover 2-9072
.'V
n. y.
c.
5
Tele. NY 1-1293
Stock Exchange
NEW YORK 5
ONE WALL STREET
1. h. rothchild &
Jo¬
seph Hinshaw, Watting, Lerchen
around $1.68.
& Co. (Detroit).
Evidently Electric Bond and
Two members of the Gratuity
Share felt that greater recognition Fund, fo* the termofthree years: should be given to the large po¬ Clinton S. Lutkins, R. W. Presstential
growth factor in UNT prich & Co., and William D.
earnings. They perhaps felt that Scholle, Scholle Brothers.
the overly-generous offer in the
Five members of the Nominat¬
EL plan would not, necessarily
ing Comittee, for the term of one
stimulate a rise in EL preferred, year: William B. Bohen; Bakery
but would tend by semi-arbitrage Weeks & Harden; Benjamin H.
transactions to pull down 'the
Brinton, Brinton & Co.; Frank J.
price of UNT—and this is exactly
C. Weinberg, Newborg & Co.; A.
what happened, UNT dropping
about 1 % points following an¬ Glen Acheson, Lazard Freres & •
nouncement of the EL plan. More Co., and William Bayne, F. S.
recently, with publication of the Moseley & Co. (Boston).
EBS plan, the stock has recov¬
If Tennessee Gas & Trans,
y
<
■Mi"
Bp
V
i
advance B. H a f f ner,
Bfpf
Thus the Wilcox & Co.;
V
of Chesapeake & Ohio common or company forecast for 1950 appar¬ Irving D.Fish,
John A. Coleman
at. a price of 62%. At the time of ently worked out at about $1.25 Smith, Bar¬
the present writing Chesapeake & per share. This failed to empha¬ ney & Co.; Murray P. Safanie,
Ohio common is selling at 61% size the trend of earnings since Shearson, Hammill & Co.; How¬
1939 as revealed by recomputa- ard Butcher, Jr., Butcher & Sherand earlier this year sold nearly
a
point above the conversion tion of actual earnings on the red, (Philadelphia), and Russell
basis of 1946 Federal taxes.
A E.
Gardner,
Jr.,
Reinholdt &
parity.
dividends. The preferred
accrued
Alabama
_
.! /
Philadelphia Telephone
TELETYPE NY 1-2155
Lombard 9008
Volume 163
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4490
taining exchange, with which she
might buy the essential sinews of
war. Her foreign trade—on which
she lived—stripped from her by
the primitive needs to preserve
her
national
integrity and the
^
The World Ahead
(Continued from page. 2639)
environment
shaken,
the
Dutch
unscathed,
the lines to her
overseas
Em¬
wi)th
posses¬
sions unstretched and unfrayed.
: France—tired—with hundreds of
thousands of her young men lyihg
beneath their cfosses—-about to
experience
monetary
a
,
.
Politically—Almost everywhere
un-
have
changed.
Holland—and
pire—remained
,
but
inflation
which was destined further to
extergovernments
moral values for which she stands.
minated by the evil forces of Hit¬
A large part of her shipping—in
ler's occupying armies.
And the
the use of
which she
was
so
tidal wave that swept over Eu¬
skilled—and without which she
rope after those evil forces were
could not successfully have risen
driven out—has not yet—in many
to her position of power—lies on
countries—receded
!;far>
enough
reveal the form and structure
to
of legitimate
re-
duce ^her^ middle class and
to
shrivel the moral strength of her
been
political institutions.
Moral Destruction
j
Morally
there
exists
a
deep
hos¬
the con¬
the
greatest
military
power on the continent of Europe.
Russia was caught in the throes
schism between two mutually
flict
tile codes of human behavior; the
of
be
a revolution that was to reduce
her to impotence for more than a
decade.
is
which holds, as Acton put it,
that, "Enforced command should
one
confined
that which
limits
fixed
to
outward
discipline and organized violence
-
of
the
an
costs she
exporter of coal—
central
and
essential
items for all of Europe—
?;
Transformed from the position
of one of the world's greatest
creditors
to-
one
of
its
heaviest
debtors—
Determined
and
done by
was
longer
no
one
'
seas.
Suffering from high
*
people—emerged from
as
the bottom of the seven
joying
the
individual
as
she may be—en¬
strength
of
stubborn
character—she
faces
the task of rebuilding her posi¬
Germany—if defeated on the should be committed to the intel¬
battle-tremained undis¬ lect and conscience of free men,?, tion—unavoidably weakened by
the
immeasurable
exactions
of
mayed, undestroyed—the integrity and opposed to it the one which
;//,'■
of her productive facilities fully Fisher has so elegantly and subtly war.
described as, "The tyranny of the
Thus, the margins on which
preserved.
If England was exhausted—if State gilded by, the ethical beauty we formerly relied—the bastions
field of
the blood of the best of her young¬
which twice within the short span
of sacrifice."
of
er
generations had drenched the
soil of France and Europe from
Mons to the Dardanelles—she re¬
The Exhaustion of England
Across
island
Channel
the
whose
on
the
brave people—all
greatest creditor na¬
tion on earth^-the greatest ex¬ alone—unaided—unsupported ex¬
porter—she was still the mistress cept by their own resolution and
the stubbornly held view that, "to
of the seas.
mained
the
Thus, though cracked and show¬
ing signs of wear, the ramparts of
the
world
western
remained
in-
,
stance
and
or
by; logic-elapsed back
languished in
our
continental
Isolation—confident that the pil¬
lars
of
western
civilization
in
Europe—though weakened—were
still strong—assured that the bas¬
tions of
continental defenses
our
remained
to
be
assaulted, scaled
and demolished, before any hos¬
tile ;force could reach out across
the'seas to" molest our?;trahquil
lives.
..
that reasonable amount of support
which will give her the oppor¬
continental
tradition—will
tunity to heal the wounds caused
by war and a humiliating occupa¬
possess
the
sensitiveness
understanding,
tion.
•V
•
.
will
Nor
.
,
this
disjointed world
be restored to order unless
tend
to
that
amount
Britain
of
Trained
in
full
we ex¬
measure
aid—preferably
new
associated with
mightiest
will
The
The
Nations
United
to
which
pin our faith may mature to
that stature necessary for it to be¬
come the preserver of the peace
own
out
of
this
and all nations?
stakes
disordered
high—higher
perhaps than they have ever been
in history.
4 Time and our own resolution
guided by a light that remains unt
dimmed will cast the. dice, ;
j
we
if
only
it
be
United States
ted
to
the
power on
confusion
supported' by
a
resolutely commit¬
role
of
the
Stockton & Co. of N.
Formed in Newark
and
disorder, in the
overpowering need, can
to give
to the outside
point of the European
economy—Germany. And I sug¬
gest that only through a loosely
hausted
by five years of living
under the muzzle of the enemy's
associated federation under
Service Act?
guns—exhausted
meager powers;
schemes for the restoration of
ark for several years.
sible
der, no mobilization of military
strength however great can long
preserve the peace unless it com¬
mends itself to the conscience of
Inc.,:.also
mankind;-
Beach development in
is
to
off
victor's
the
wear
the
greatest
military machine in history until
our
powerful ally to the east be*
came-committed to
plunged into the
Across the Channel—in
the
center
Britain,
of the Commonwealth
by
by sacrifices of which
full
privations,
we
have
no
comprehension—moH of her
foreign
investments
from
which
she drew such strength liquidate
•J
The
problems created by the
holocaust of war are> incalculable
in
their
tVio
r»V>
magnitude
signifi¬
and
cance..
We Must Deal with Germany
Promptly
the war, and
conflict.
I venture the assertion that we
will find no adequate answer un¬
we deal forthwith with the
less
central
tral ; government
a cen¬
of i limited
and
With the Ruhr and
Rhineland separated from her po¬
litically, can we avoid the impos¬
administrative task
of
con¬
trolling her production. Only uhthis
General
sort of
a
recon¬
face of
But
sey,
an
no
Company; is President of the new
mechanical
purely
-
,r,v
.
or¬
.♦
corporation; He has been engaged
in real estate operations in New*
.Telfair
Stockton
owns
*&'Company,
the Ponte Vedra
^
ramparts have been demolished.
Now Europe lies in ruins.
This announcement is not to be construed
as an offer or solicitation for the sale
offering is made only by the Prospectus,
The
Now Europe Is Devastated
r
Florida. )
xi
or purchase
of these Securities,
stretch
of the Continent—from the Urals
to the Pillars of Hercules—I
ven¬
ture the assertion that there
been
Not
a
New Issue
May
■
has
'IV'/
visitation of devastation,
desolation—eco¬
a
IS,
1946.
■rf iM
271,250 Shares
destruction, and
nomic;
financial, political,! and
inoral—unparalleled in the long
and tedious history of the human
race.
Every wherein
Varying de¬
grees—In France, in Holland, in
Belgium, in Switzerland, in Italy,
in the Balkans, and in the Danubian Basin—the physical destruc¬
•"
tion
Mercantile Stores Company, Inc.
Common Stock
Without Par Value
of
productive facilities and
transportation has been necessari¬
ly accompanied by shocking defi¬
ciencies
in
food
and ' coal—the
bare necessities of human life.
-
Sources of
sentials
of
.
supply—of the es¬
living—have
been
Price $33 Per Share
shifted, if not extinguished; Pro¬
duction v languishes, and popula¬
tions face the grim specter of star-
■;vation;!!;!4£^
:
Within Germany great metro¬
politan areas have been reduced to
piles of rubble. Industries—the
providers of Europe—have been
destroyed. That intricate trans¬
portation system—encompassing a
Copies of the Prospectus may be obtained only from such of the undersigned as may legally
offer these securities in compliance with the Securities Laws of the respective states.
web of railways and far-flung ar¬
of water commerce—have
teries
been smashed. Food is inadequate
for
Clark, Dodge & Co.
physical effort—fuel is insuf¬
ficient
tion.
for
warmth
and
produc¬
No vestigial remains of gov¬
are to be observed.
•••,• }
ernment
That delicate, complicated, and
sensitive system—at its best the
throbbing industrial heart of Eu¬
rope—is still.
Financially
—
Throughout most
Blyth & Co., Inc.
Harriman Ripley & Co.
Smith, Barney & Co.
Lee Higginson Corporation
Kidder, Peabody & Co.
Stone & Webster Securities Corporation
Merrill Lynch, Pierce, Fenner & Beane
of Europe each national monetary
ancj
fiscal
system—differing
in
degree only—is uneasy—quiver¬
ing on the shifting sands of ac¬
cumulated
penditures.
debts
and
heavy
White, Weld & Co.
ex¬
;
//'
j
NEWARK, N. J—Formation of
earth. Confronted with Stockton & Company of New Jert
greatest
.
vast
us
j
^
.
that
the
are1
,
Throughout
as
earth, that wb
lasting peace among
a
4
No W; these pi liars i ha v el ,beeh
razed to the ground. Now these
:v.
We
the
welfare
status
our
power on
hew
capture most of the strength she
has necessarily lost in her gallant
U. S. Must Support UN
our
bur
discharge our
responsibilities irrevocably
world
of Christendom.
to
have been in
and security, so to
not dressed up in the raiment of
a loan—with which she may re¬
struggle to defend the basic ideals
as we
of; Nations,
and
Empire—still
powerful,
but ^exhaustedex¬
well
crown"—stood
until at last we
And we—with superficial justi¬
fication — unsupported by sub¬
a century protected
provided, us with that
amount of precious time in which
we
successfully
mobilized
our
strength—have been destroyed.
and
structed system can Germany's
^Production and distribution of
peacetime productiveenergies be ilie essentials of life—unrestrained
safely released and encouraged by government interference—un¬
for the benefit of Europe as a
hampered by trade obstructions-4whole.
;
.*
unshackled by nationalistic mone¬
I venture the suggestion that tary barriers—alone can solve the
without a France rebuilt in con¬ problems of scarcity—this, sup¬
cert with our ideals there will be ported by that amount of foice
no
return to tranquil living and necessary
to
preserve
order,
can
that to this end this great country alone
slowly establish tne
should in its own interests extend bases of an enduring peace.
-4
with offices at 24 Commerce
Street, Newark, is announced to^
we
fail
day by J. P. LeMaster, First Viceworld the one unmistakable sym¬ President of Telfair Stockton &
bol of our resolution--the one un¬ Company, Inc., the parent com?
The new company will
impeachable evidence of our de¬ pany.
termination
to ; exercise
our
specialize in mortgage loans, inr
surance,
real estate investments
strength, to nourish the United
Nations during its infancy wher¬ and construction loans., j
4 *
ever that strength may be neces¬
Edward A. Judge, a former of¬
sary. Can we fail to approve with¬ ficer
of Commerce Management
out equivocation or qualification
the extension,
of the Selective Company and Lincoln Mortgage
die
Western World Remained Intact
quarter of
a
us
2657
x'/.
.
,
■.
From
Jan.1 1,
1939; through Pec. s
these stocks on average
have i increased,) their
intrinsic!
value by $71.60 per share." Yet on;
May 1, 1946 their current averagej
market- price was only $68.39 a
31,
1945
share.
.
In other
words, during a period,
when these 'stocks' have added.;
Industries with the greatest relative profit possibilities and the over $70 a share to their intrin*
sic
value, their market,! prices
least relative price risk, according to Hugh W. Long & Co.'s May have advanced only $10 a share,;
issue of the New York "Letter,'" are Building, Metal and Oil.
Other And their current .market price is;
industries with good profit possibilities but having greater price risk still' less than the amount of their;
wartime gain in intrinsic value! ;
'ate~ Aviation, Machinery, Railroad Equipment and Steel.
Most Favored Industries
t
in. this
Two other items of particular interest are discussed
_
Letter.
The
•"seasonal"
prices.
first
is
rarely
prices
go
advance
•an
of
tions."
varying. propor¬
.
1945
+5.2% '
1940
1944
—10.4
1939
1943
—1.6
1938
+3.9
+•+6.4
1937
1936'
1941
Hedge
in
EQUIPMENT
the; ;diffejrence
and
like
they
are
or
—
dependents who do not know
most
he^waen a .stock
After posing this
,
,
+ 9.1%
+10.9 •
+13.9
7:0
+ 3.5;v
average
triple-A bonds and half in com-;
As
stocks is considered.
mon
com¬
pared with 10 years ago, the bond
W.
proceeds
whereby
.
Wife and children proper;
invest-;
experience through the use
Gifts'of shares of
Wellington Fund are recommend¬
ed in setting up such trusts.
ment
vestment
First
in
Mutual
Trust
Fund. -The income from the
nicipals,
which
is
non-taxable
amounted to $29,821.07 net. Tota
distributions1 from/the-Fund, in¬
term
$79,-
$39,-
tota
Thus
the Fund afforded about one-thirc
after taxes: than the munic¬
more
ipals.
In
investment
an
mu¬
addition, last
the
year
net
.
_
made
outright
terms
of
in trust.
or
should
trust
the
to
programs?"
5
YOUR INVESTMENT PEALER OR
.
63 Wall Street
-y
Earnings
/'
r
»
if" I-
v?
*'; L
,
Outlook.
Keystone Co. surveys - the out¬
.
New York 5.N.Y.
*
*
•s
r
•
Favorable
Distributors Group, Incorporated
look for corporate earnings in its
current "Keynotes.'/
"There is
hardly any question that a high
level of business is indicated for
"Whatever degree of price con¬
is finally adopted by Conr
trol
commodity
higher
gress,
Fourth of a
donors, will be forwarded
request."
;
,
^
series of bio~
>
graphical sketches of persons
connected with the Interna¬
tional Monetary Fund and the
Bank for Reconstruction and
Development.
In
1944 Mr.
.
;
,
Gutt, then Belgian
Minister of Finance and Economic
on
Affairs,
attended,
.
Woods Monetary
Philip Morris and Affiliated Fund Conference as
Lord Abbett in the current is¬
of Abstracts discusses the de¬
sue
chairman
o
the
.
and
Bretton
Financial
•
-
.
.
^
f
his country's
-
cqmmbn+ stock of delegation. He
Philip Morris from- 74 to a low of participated
cline
the
in
41+4 recently.
After- citing the
improvement; in .that stock's posi¬
tion subsequent to the develop¬
ments which brought about its
makes the
decline, this sponsor
following comment:
"It will be of interest to deal¬
to know that Affiliated Fund,
ers
the Savan¬
in
nah
ral
inaugu¬
meeting of
the
World
and
Fund
World Bank
;
governor
the Fund.
-
Savannah,
tic decline
Gutt
no
Dividends
as
his country's
Philip Morris in the
porfolio at the time of the dras¬
Inc. held
of
At;
M.
was
elected executiv
e
director
the
of
Camille Gutt
Fund
and also of the Bank, He was
only one to be thus
institutions,
,
Mr. Gutt served
the
elected to both
„
/■
"
,*
only momen¬
Group Securities, Inc.—The fol¬ tarily as executive director, since
lowing second - quarter ;div|dends 'at the first meeting of the execu+
payable May 31, 1946. to share¬ tive directors of the Fund he was
holders'of record May 17. I
made its General Manager, upon
in¬
•.
'-v-^For 2d Quar., the nomination ofthe United
...
prices
appear to be; in prospect at least
for the next year, due partly to
' effect
of
public purchasing power;
fundamental
the
creased
States. The same week Mr. Gutt
.10: resigned his executive directory
were
temporarily
.04
.06
.10 ships, which
.04
.02
.06 taken oyer by Mr. L, A. Goffin,
type, anc
counsellor of the Belgian Embassy
.025 .035 .06
dustry would be allowed to make, the sustained level of industrial Building
Chemical ——+ +045 -035 .08 in Washington and Mr. Cutt'S;
a reasonable profit".
production- anticipated for some
Elec. Equip.
"The 50 companies in Barron's
.05
.05" ! .10 choice as his alternate.
time, together with urgent for¬
Reg. Ex. Tot.
-
v
higher incomes mean greater de¬
mand for consumers' goods, .both Aificultural 1
Automobile—sponsor.
"The principal factor of ; of the immediate
consumption anc
Aviation
uncertainty has been whether in¬
"durable or semi-durable
of the
.
con¬
some
several years to come," writes this
One
CAMILLE GUTT
General Manager of the Fund
the
.
■
and World Bank
The.
-
-
ment
Manhattan
on
^
.
.
.
Officials of Fund
"Gifts of Fund shares may be,
mentioned above, but
beginning at a level around 50, a
50%.
This. sponsor's current .issue^ of program of accumulation was in¬
"Is it any wonder that more and, Investment
Timing 'analyzes the stituted and the Fund now owns
more
investors
are
^profits- outlook for commodity prices. 10,000 shares."
+,
minded' in. planning their invest-, Here
are the conclusions: .
,
.
of trust funds,
individual needs, of
In a current issue of "National, the/ donor
and his family and
Notes" National Securities & Re
should be prepared with advice of
search Corp. compares the net in¬
counsel.
However, a short form;
come' results 6f a $1' million in¬ of an irrevocable declaration of }
vestment in high grade municipals trust
prepared by our counsel,
With
that
of ■' a -similar
in¬ which might suit the needs of
29%, the stock in¬ increase in market value of the
come up 6%+-Adjusting for ithej investment in the Fund amounted
26% rise1 in' living costs in the to $243,60952, as .compared with
interim, the "real-income" pro-1 only" $34,662.50 for the invest¬
ducing yalue; of these savings has ment in municipals.
/ ..
been reduced by approvimately
..
.
folder
L, Morgan &
.Wellington Fund; Bond Fund,
to outline a method
a father can give his
question,
would be down
QNAEQUEST FROM
Keystone Investor.
Hugh W.
Co. +♦ Current monthly
the* sponsor! of
—
between
income from such
A PROSPECTUS
for .May on all Keystone. Cus¬
todian Funds; current issue of the
er
Long &
Co., portfolio
bond?"
a
form
price for June and that of j;he; cluding $45,892.20 of net long
capital gains, amounted to
third week in September. ;
+ i
669.28 before taxes and to
The seeohd item has to do with
831.96 after taxes (assuming
the decline in real income from
taxable income of $150,000).
investments. A $20,000,fund, half
RAILROAD
vyj.jL,
-
is
:l!Change
r
September*
June to
1942
.More frequently, they record
Low-Tax Inflation
investments?
*
Rrice Change, S, $ P.
Composite Average
ofstock
movement
"Stock
summer*^
the
"clown between June and Septem¬
ber.
Thursday, May 16, 1946
THE COMMERCIAL <& FINANCIAL CHRONICLE
.2653-
AO
—
—-
„
NATIONAL
Securities Series
- Price.
Index -had • average
earnings in 1937 of $7.60 a share,
and paid average dividends of $6
a share.
For 1945, earnings were
Stock
$6, and dividends
were
$4.20.
eign needs', means a'high demand
for materials of all kinds.
We
look for
increase of
an
approxi¬
mately 15% in commodity prices
clined
"In
A/
-
■
"A
contrast,
high level
activity,
ness
of national in¬
high level of busi¬
With
every
indica¬
tion that business volume, will be
120 BROADWAY
New York 5. N. Y,
y
V-
above
Hugh W. Long & Co. in
new
memorandum-on that Fund
alert
In
current
a
in
Steel Stocks
who
and
undervaluation
Steel
News, Dis¬
in
a
representa¬
tive group of leading steel stocks.
v
Average
.09
the front during
AO
of World
Merchandising
Mining
,065 .075 .14
.025 .015 .04
Petroleum
of
A
of
poration.
Question for Father9
you
encourage your wife
to develop a' sense
children
responsibility about money or
.
.
.
r
.
t«NA»- • :vs; ,/
investment dealer
fiscal:
Memo
*„
;;
.
.;/•
•- -r
:
20 Exchange Place
'
from
your
Prospectus
map
be obtained
■
,.i/.
/.
Congress Street, Boston 9, Mass.
and Minister of State
•:
(1945),
v;
1
1
••
>
«
Dart and Sindoni Are
Marvin Co. Partners
PHILADELPHIA, PA.—George
W.
William Francis
being admitted to
and
Dart
Sindoni
are
,
partnership with Frederic H. Mar¬
vin in the firm of Marvin
Building.;
& Co.,
Both
be obtained
:
,
r
holders
business
of
SELECTED INVESTMENTS COMPANY
z
/quarjr;
pit
CHICAGO 3,ILLINOIS
June
,
IS,
1946
to
June 1, 1946.
v
A. W,
48 Wall Street,
TEX.
—
Fred
P..
nership with Alva W, Snyder in
COMPANY
National Distributors
Snyder Partner
HOUSTON,
Hamill will be admitted to part¬
Incorporated
"/
;
F. P. Hamill to Be
^recqrd at , tlje close of;
HUGH W. LONG and
135 South La Salle Street
time..
4,/
from authorized dealers, or
'T.i-5.;~X\
Keystone Company
of Boston ■/+''+ 1+
50
may
local investment dealer or
■■'*■
The
New York 5, N. Y.
Teletype ny-1-2439
Prospectus
/,
terly dividend No. 50 of $.22 pe^
share payable on the Corporation'^;
'capital- stock
INC-
[or¬
the Belgian
for
Plenipotentiary
Government (1930-31), Finance
Minister > (1934-35 and 1939-45),
fundamental Iitj?.
;:vestorInc., y tiaVe;«declared
"
*
distributions;
year-end
:
showing portfolio changes
Fundamental Investors, Inc.
Funds
;
cor¬
Min¬
when he was ap¬
pointed Belgian assistant delegate
on the Reparations Commission.,;
In 1926 Mr. Gutt was again first
assistant to the Finance Minister
and in 1929-30, Belgium's repret
sentative on the Young Commit-r
tee. Thereafter he was successively
ister until 1924,
have been with the firm for some
.
J-:'
.04 i .08
Commission. His next post was as
first assistant to the Finance
Lincoln-Liberty
KNICKERBOCKER SHARES
General Distributors
.04
— /
.04
Trust; Funds; A letter re
The Directors of
.
.03 ■'[ .07
Keystone C o.—Current Data fpld-
Custodian
.
.06
■
f .07
—
during
April. . . . Distributors
Group—Monthly price comparisdri for May on Group Securities;
?.
or
.02
National Securities
Corp.^rCurrent ; In¬
^
•'
.04
;07
.04
reprint of an article on steel
ders from Steel Magazine,
Keystone
Prospectus may be obtained from your
gian Delegation in the
.05
received by a
Research
National
Supervision and Safe-keeping
of Investments
.01
—
-
dividends
Belt,
Reparations
later, secretary general to the
—,04
Utilities
gian War Material Purchase Conw
mission,An A917 .and'twdf,years,,
.04 ! .09
.04
—
Tobacco
made secretary general
.05
———
formation folder for May on all
"Do
for the Diversification,
.06; .11
.05
——
Railroad Bond
&
similar funds.
1884, Ca»
the first two years
War I, Mr* Gutt was
to the Bel¬
.01
held
and also did better than the aver¬
age of
and
Fund
a
successful
Composite
Dow-Jones
Brussels in
Gutt
—
Railrpad Equip.
Railrpgd Stock ---i
Steel;
time in the last decade bene¬
from
in
graduated in political
sciences in 1903 and became a
Doctor of Law in 1906. Serving at
mille
.08
shares of Fundamental Investors
fited
.10
.04 i .09
^
tributors Group demonstrates the
Knickerbocker
Investors?
Fundamental
asks
any
.10;
AO
_
—
right time to in¬
Answer'— "Investors
—
.05
-
Institutional Bond
prewar
Undervaluation
The
vest, in
the
General Bond
Indus. Machinery
.04
Born
.025 .07
.06
——
" levels, • it. is a management." This statement is
''....' X--V
J\K*/:
by performance i fig¬
reasonable assumption that cor¬ supported
Mutual Fund Literature
porate earnings and dividend pay¬ ures on. Fundamental Investors
Lord Abbett—Composite Sum¬
ments will improve from the de¬ going back for five different pe¬
mary folder for May on all Lordpressed levels of the past four riods, the longest one nine and
one-half years.
In every period Abbott Funds; Investment Bulle¬
years."
Fundamental did better than the tin discussing Federal tax status
far
NATIONAL SECURITIES &
RESEARCH CORPORATION
!**
Question and Answer
When is
come pnteans a
Prospectus upon request
from your dealer or
■
were
national income
has risen from $72 billion to $158
billion, an increase of 120%.
GROUPS Shares
Priced ot Market
and dividends
21%
down 30%.
.045
.10
----i
Fully Admin. ——
Invest. Company —
Low Priced
As this year."
compared with 1937, earnings de¬
SELECTED
Food
A.
W.;:; Snyder
j;
,
„
{'
New York 5, N. Y.;
Mortgage
has
been
&
Co.,
Bankers,
Building./ Mr.
Hamill
with
Rotan^
recently
Mosle'&. Moreland,
•
*
nm
•
V-wVv*. .«/■>.''*.' *'*
■
Volume 163
■* ■*■
lr*:«r-».iU
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4490
Of Domestic Commerce
Looks at South America
-
aspiration,
sincere Interest
more a
ter of national
but
mat¬
as a
pride in moderniz¬
ing the economy, increasing the
national income and raising -the
standard of living,
;V
• as
was
em-
phasized to us in country after
country during our trip," Mr. Gas¬
ton said.,
"Naturally they - want
some
financial
help from this
country, but we may also antici¬
that
pate
considerable
a
amount
for
these
cable
the success of our investments
there becomes apparent.*'
•
•,
•>•••.
^uMt; Gaston %as
v
greater
sources,
try
than
ore
this
This was
Office of Do¬
The
of
matter
mestic
act
ho progress was made thereby. It
is well known in oil circles that
re¬
coun¬
During the war the there Is ample American capital
lent money and talent available to develop
a railroad
the new oil field, but this is not
to tap • some of these resources.
possible because of Chile's law
The railroad is still not completed,
preventing use of private capital
tout will soon be. 1
in this field. As for the ExportThe Export-Import Bank offi¬
Import Bank, it is its general
cials were especially interested in
principle not to compete with
the steel fnili which, with the private capital, when it is obtain¬
Bank's help to the extent of $45,- ableoh reasonable terms. The
000,000, the Brazilians now have trend of thinking in U. S. Govern¬
atlVolta' Redonda; '"The mill is ment circles is that in the highly
ment
■
.
,
of
tical
the of¬
What
perma¬
since
I emphasize thakAmerioan
The Chilean
borrowed from
tech-
when
easily be making
they
money
it.
on
| Both Mr. Gaston and Mr. Ness
.
nationalization,
could so
Gaston said.,
"Fbmerito"
has
melExportllrn?
Hans S. Rothschild Dead
n
and
so
constitute
a
arid local industries. And
resources
the
also
money,"
education
American
in
methods
Chileans
of
engineering
during the war;
*
1
; 4
As
.
"whether
to
projects
on
which the Bank has beem lending
the
will
ond partner of
death
of
his
3.
looks
I;
the
fact
that
the
will
balances
smashing unions;
Refuse to bargain collective¬
ly, thus refusing to recognize the
rights of labor, -as such.
I As to the employee, he does not
control the hiring and
cause
1.
the firm until the
father-in-law in
The
very
credits,"
record
is
it
of
'
otherwise.
3.
tures therefor will not exceed the
amount of the
Rather
appropriation."
than
reductions
Declare jurisdictional or
gen;
•
."
'
*
eral strikes.'
I
4. - Ad opt
make
staff
in
defaults.
a
furlough;
or
"featherbed" rules of less than
thirty days, the comwhich destroy the job.
,
was
decided
! Thus nobody can really own pul£6ry. furldugh
jobs in a free country. Jobs exist upon, the Commission said.
.
as an
offering
PreferredStock, $3.50 Series
'":S -<■%*';'■ •■'y.;.'' f;
'
-v '•'
•
•?
).: •'
.
-I
■
il f'j <-.v| {•'f. '-i,
av!
*The Company is offering tothe holder^ of its outstanding 130,000
shares nf $$ Preferfed Stock the prior right^^xchangfftg such
.
,
*
stock for Preferred
Basis, with
a
Stock, $3.50 Series, on a share-forrshare
cash adjustment, as set forth in the Prospectus.
Price $107 per
wartime credit was to
help. locate
strategically located oil reserves.
In
circumstances to be construed
no
negligible
| Despite Chile's failure to date to
on
of record only and is under
Union Electric Company of Missouri
■
share
p|us acqrued dividends from May 15,1946
■m
Mr.
Gaston said,
financed projects in
In view of the high
interest Latin America is being honestly,
rates prevailing in Latin America, if not
always most efficiently,
Export-Import Bank Credits
•vr'btt^hiay. wonder whether ' the'fcx*
of y Export-Import Bank
credits there at 4% interest does
.
a
allowance
for
In all the Latin American, capi^
tals
subsidy toy the
American Government,
|
the
fee
visited,
the
Bank's
officials
Hio <ie. Janeiro.
"Our
cluded.
credit. But this is not regarded fin
main
Mr.
-
>
.
"
hCo., lB& ty Inc.
-
••
'
'I'll I
*
•
.
.
•
'v
v',1"
r'X-i?
.
.Lee Higginson
resources and
a fair interpreta¬
the great impatience to finance its
the ^situation. In Latin
;
/
America there is not a good mar- development."
ket for local government securi¬
of
I;''
~
impression," con¬
"isLatin
Gaston,
America's wealth of
Washington as
tion
Ill I'll.
after andytouilding^;hooms|espe(riaBy Iri
which the
even
•ultimate borrower must pay to his
,
Copies of the Prospectus may bit obtainedfrom the undersigned
only by persons to whom the undersigned may legally offer
these securities under-applicdble securities lawh
.
noted marked real estate iriflation
I government for guaranteeing the
f
on
carried out.
tension
| pot ^constitute
general,
the work
E. H. Rollins & Sons
Corporation
-.7.
.
441
-
,•
Incorporated
/
.
.
;
ties.
While
Latin
American
To Address Cashiers
gov¬
ernments and others borrow from
the Export-Import Bank on their
bonds, in some cases at least the
i
1
IT. K. Kenner, General Manager
of the Better Business Bureau of
N,
Y.
C., Will address a dinner
borrower does so with the inten¬ meeting of the Cashiers' Associa¬
tion of Wall Street, Inc., on May
tion of turning the project over
to
.
local
common
interests in
stock.
*
For
example, in
the form
of
16,
at
120
Broadway.
the
Savarin
Restaurant,
His topic will be
Chile—which "Safeguarding Wartime Savings."
Clark, Dodge & Co.
Spencer Trask & Co.
['ft ,1 -L''
»f;;
"I '•. I
:.l|l.v|
: '
The Ohio
";l ".!!• ::'|-r
^ •_
;
.y'■ "
+'r< 1 ■'. /
.1
Company
'•
X'
-
./I' I
r
v"'
hV>:' •
.
|
The Wisconsin Company
:
Hawley,Shepard & Co...
;'-5*;
..
•
•
H.F.Boynton & Co.,Inc.
l-'v'
-
.
"■
v
Kirkpatrick-Pettis Company
May 14, 1946.
7
about fifty employees for periods
.
130.000 Shares'
'
•
permanent,
,
credits
a
em¬
;
pointed
these
good, with only
amount of
<
I
.
the job, as a
on
In
,
New Issue
take the form of the Bank's
out.
stimulus to local investment,"
Interest Charges
or
firing, be¬
.
sdlicUationspf,mtfffr to%uy* 4ny of.such Shares* The>,»„♦
xfferin^ismadeytnlyf^th^Ttosfpficius^ThiS AdvetiUement is published onhehaff of:onh such ofII
v:p^o%eriJn::3epurMes<in. this Slate: v, .7- 4 .
I ago, with very high interest rates interest the Export-Import; Bank
and heavy demands for capital; in financing the development of
fit's my notion that the invest¬ the new oil field;it Is known that
ment of a moderate sum of Ameri¬ Chile has been able to apply some
of its wartime borrowings here to
can dollars through the Exportthat end,—a Wartime nil explora*
Import Bank in Latin America
tion credit. The purpose of the
may provide a very considerable
;
"Sit down"
striker
agency.
its
1,194
m a
of the Bank in the past-has been
developmentyplans,
according to Mr. Gaston. 'Latin
America in many respects is very
much, like four West a fewdecades
|
he can not::
to
self-liquidating,
prove
"exporter
do not generally belongto the
authorities or the private interests
who have the
for the purpose of
men
the
for
ployees, of whom 871 are in Phil¬
adelphia, the ! Commission stated <
that its appropriations for salaries
and expenses for the current fis-v
cal year, which ends June 30,
"would be over-obligated on the
basis of present salary commit¬
ments,; fixed charges and other
items of expense" and that "it is
now
necesary
that
action
be
taken to realign these commit¬
ments and obligations
to make;
certain that the actual expendi¬
7 "4.
This advertisement appears as a matter
-.
-
veiop their own * resources with
their own money, but this over-
i
Fire
funds
memorandum
1030, at which f imevho becam^Tsef ! 2. Engage in violence or intim¬
idation by mass picketing to keep
nior partner, .
■:
-j
*
j He was
a member of the New other bona-fide job seekers out.
;
impression. Many of the
projects
being
prompted
by
Chile's "Fomento," for ! example,
Ari^
;
of
competent
a
,
greatly increased Latin American Messrs, Gaston and Ness
a^e-be¬
| gold and tdollaf balances accumu¬ lieved to have
gotten IA very
lated as a result of. the war, Latin favorable
;
•
hire
Broadway, New York City, died man who needs work which the
at his home in Greenwich, Oonh. employer has available.
at the age of 57,' '
| 2. Discriminate in employment
^ c
on purely personal grounds. ^ " ■
Born in; Germany, Mr. Roth¬
■JsK
„
It- mightrseem that ^with
change Commission must take a
day off without pay between May
31 and June 14 because of a lack
the beneficial results of
saw
the
Effect.of Latin American
::f-v^ Aecm^iulated Balances ll;
:
PHILADELPHIA—-All employ¬
ees
of the Securities and; Ex¬
used, in this project; The visitors
the American pattern, with
help of American engineers
on
and American
to
«
;
not:
can
1. Refuse
.
|f ; this
he
cause
Hans S. Rothschild, senior part¬
of Sutro Brothers & Co., 120
ner
steel mill and
Latinos
For$EC Staff
The answer again is, Neither.
As to the employer, he does not
control the hiring and firing, be¬
port Bank some $28;000,G00 for a
the
Day Off Without Pay
7
York Stock Exchange, New York
Curb Exchange, Chicago Board of
$33,000,000 for other
:
most effective good-will
the
Commodities ^ Ex¬
force. purposes. Gaston and Ness looked Trade,
% Said Mr. Gaston: "I suppose that at the Sauzal hydroelectric
proj¬ change, Incorporated, -. of -New
Export-Import Bank" loans have ect, financed with the Bank's "help. York and the New York Cotton
been ene of the most'important American
i'engineering help and Exchange!
influences in stirring the Latin American;
equipment, much' adAmericans to develop their own Mired in
Latin America, were
hidans get along veiy wdl with
p
the
on
-r
competitive oil business, govern¬ schild came to the United States
Mr. ments operate at a disadvantage; 38 years ago, 4 He was Associated
Gaston remarked. The Brazilians Mexico is a
good example of the with the firm of Baruch Brothers
1 figure on au output of 350,000 tons poor economic results -of govern¬ until, shortly'after his marrige in
of steel a year. The mill has a
ment oil operation. The business 1913 7 to May Sutro, ' daughter - of
| liOOO-ton blast furnace and thrCe is a highly specialized one. Good Richard: Stttroj i who was then
:
open hearths now Operating; also people are hard to get; Mexico senior partner in Sutro* Brothers
| a by-product coke, plant.
was has been losing money on its oil & Co. Mr; Rothschild: was a sec¬
American planned and super¬
vised job from start to finish," Mr.
there
are
Ownership!
.
^creditable ; job,"
an
limits
in
,
employment, or to put it bluntly
but honestly, who controls hiring
and firing?
1
,
:
4
,
modern in every sense and is an
extremely
down to this:.
comes
,
J
*
issue
efficiency and coop¬
doing the job.
No
upon
eration
rights of each with reference to
appointBrowning's suc-
Gen.
of
cesser.
■
i 11
Direc¬
nent
for the construction of
-
w
based
oversimplify, and reduce
on "the job" to those
enterprise and labor, the prac¬
all claims
pending
th e;
ever had.
Export-Import Bank*
;
fice
H. B. McCoy
,
as
tor of
....
They
are merely discovered by enter¬
prisers, and organized and direct¬
ed to gratify the social demand.
The job has to have labor. But it
also has to have enterprise and
approximated in practice — is a
condition in which, in order to do
a. job,, enterprisers choose among
laborers, and 1 a b o r e r s choose
arhong enterprisers, neither hav¬
ing rights to the job except those
If we
Com¬
merce,
the
financing
newly-discovered oil field in the
south of Chile was discussed, but
iml
very much
pressed with Brazil's iron
-
.
manufactured.
is
Export-Import Bank project.
an
;;
for the benefit of society.
of
*
as
purposes
point
Labor?
or
(Continued from page 2651)
,
McCoy had been designated
interest Acting Director of the Office of function, or "doing a job," as long
for Messrs. Gaston and Ness — 1"
Domestic as (1) the job yields products that
several enterprises originally Ex¬
Com merce are worth more than they cost,
port-Import-Bank financed and
following the and (2) their efficiency and coop¬
now privately owned were pointed
resignation of eration in performing it prove
:
out
to
the visitors.
There the
Gen. Albert J. them to be as. fit as any competi¬
"Fomento"
aids
private
enter¬
Browning.
tor.; But neither owns his job, in
7
Mr. McCoy, the sense of a right to hold it re¬
prises in-' ooveilng^ their dollar
costs and sells out as soon as pos¬
who has been gardless of the demand -for the
sible. Among the plants visited in
serving as product or his efficiency as a
Chile 5. was
the Madeca, where
Deputy .Di¬ producer.
rector of the Who Controls
every ? kind of copper wire and
Hiring and Firing?
tne
was
i bf their local capital will become
available
H. B.
main
Industry
t Under-Secretary of Commerce
Alfred Schindler announces that
(Continued, from page 2639)
money-making
2659
,'
McCoy Acting Director Who Owns the lob-
Export-Import Bank
,
;«*«*. t. 1*5
.
•
.
'
.
.•
.
•
"•
'
_•
i'li-ll
.-I
Rotan, Mosle and Moreland
.
-
I
-
—'
-
...
.
.
-
THE COMMERCIAL & FINANCIAL CHRONICLE
2660
dent, Continental National Bank,
Fort
Worth, Texas; Thomas J.
Groom, President, Bank of Com¬
merce
and Savings, Washington,
D.
C.; Robert W. Sparks,Vice
Blair & Co., Inc., headed an un¬
(Contiuned from page 2649)
President, Bowery Savings Bank, derwriting group which offered
fOr tne people the benefits of the
New York, N. Y.; Allen Morgan,
to
the public, May
10, 200,000
investments
that
you
bankers
Executive Vice - President, The shares of Bowser, Inc., $1.20 cu¬
helped us sell to 85 million Ameri¬ First National Bank of Memphis,
mulative preferred stock, par $25,
cans.
,
The banks' part in this
Tenn.; George R. Boyles, Presi¬ with common stock purchase war¬
program will require leadership of
dent, Merchants National Bank, rants attached, at $25 per share.
the same high
capacity as the
Chicago, 111.; William R. Kuhns, Each warrant gives the holder the
American
Bankers
Association
Editor of "Banking," 12 East 36th right to purchase one share
of
gave to War Finance through your
Street, New York, N. Y„ Secretary. common stock for each preferred
splendidly
effective
ABA
War
share held at prices ranging from
Bond Drives Committee and State
$18 per share between May 15,
ABA Chairmen."
1946, and May 14, 1948, to $24 per
In reply to Secretary Vinson's
share between May 14, 1950 and
letter, President Rathje said: "I
May 14, 1952, after which the
am
happy to acknowledge your
warrants will be void.
letter calling on the bankers of
Lieutenant-General
Hugh
A.
Proceeds from the sale together
the country for continuing aid and
Drum has been elected a member
with proceeds from the sale of
to act for the Treasury as issuing
of the Board of Directors of Law¬
detached warrants >for the
ABA Committee
Blair & Co, Offers
on
Bowser Preferred
Treasury Savs. Bonds
,
;
agents for United
Bonds.
Savings
States
I
recognize, with you, the
importance of the task and the
necessity of keeping the public
debt as widely distributed as pos¬
sible through the sale of these
bonds to individuals.... It will be
purpose
to continue the same
general type of organization, op¬
erating through State ABA Chair¬
men, that functioned so effective¬
ly during the
war
years."
,;f'.',.1rhe ABA Committee
on Treas¬
Bonds
and
State
Chairmen will cooperate with the
'United
States
Treasury in an in¬
tensified sales promotion program
'for the sale of U. S.
will begin
second
;
'
Savings Bonds
June 6, the
on
anniversary of D-Day in
France.
This promotion is not intended for the purpose of increas¬
ing the public debt but is aimed
at maintaining widespread owner¬
ship of Government obligations as
one
of the most effective anti-in¬
flationary measures.
k,
The ABA Committee
Treas¬
on
ury Savings Bonds will include,
besides
Chairman Hagemann, the
jfollowing: James G. Hall, Execu¬
tive Vice-PresidentjlThe First Na¬
tional Bank of Birmingham, Ala.;
;J. L.
Driscoll, President, First Se¬
curity Bank of Idaho, N. A., Boise,
Idaho; Burr S. Swezey, President,
LaFayette National Bank, LaFayette,
Ind.; E.
Chester Gersten,
President, The Public National
Bank and Trust Company of New
York, N. Y.; George R. Martin,
Vice President, Security-First Na¬
tional Bank, Los Angeles, Cal.;
Henry J. Nichols, Vice-President,
National Shawmut Bank, Boston,
Mass.; Edward H. Wintony Presi¬
This is
>
not,
yers
say
here that I
the
American
confident that
am
will
system
the
cannot do
make
provide
equipment.
as J have said,
by anything less
so
wish
I
What
in
emphasize
to
is:
planned production
that centrally
and
than maximum performance,
increases
for
alone
grade, although,
we
General
j
^
chase of 50,000 shares of
shall
try to describe briefly
of the characteristics of the
distribution is
tion
of
the solu¬
not
they function at present.
there
In Russia, state
Distinguished Service Medal with ferred stock.
ceeds
French
ventories
Legion of Honor
and a
will
be
capital to be used
and
Among the honorary degrees
that General Drum ; has received
and
cal
poses.
for
general
corporate
Bowser, Inc., is ah Indiana
pur¬
cor¬
Science, Manhattan poration which succeeded to the
College; Doctor of Mi 1 i t a r y business founded in 1885 by S. F.
Science, Georgetown University, Bowser, inventor of. the gasoline
and Doctor of Laws, Columbia pump.
The company was incor¬
and Rutgers Universities.
porated in 1899 under the name of
S. F. Bowser & Co., Inc.* and is
General Drum is a member of
are:
Doctor of
the New York Chamber of Com¬
merce
and
is
now
President
of
of the oldest pump companies
in the United States.
one
and
centuries
the
small
coopera¬
that
villages
made
products
support the popula¬
to
tion.
the Soviet Union
abandoned the idea of
operating
industry
through
a
strict
application
of
political
equality,
Technicians now oc¬
cupy Van important place in the
scheme of things. Differences in
pay are very considerable. Earn¬
ings of technicians have been re¬
ported as much as twenty; times
as high as those of many workers.
Industrially,
long
ago
and
Prizes
and
there
bonuses
are
offered
are
non-monetary ad¬
The company and its subsid¬ vantages accruing from special
the corpora¬
skills and ability, such as better
Empire State iaries are engaged in the manu¬
Commanding facture and sale of liquid control housing facilities and vacations in
choice resorts.
It is interesting
State Guard, devices such as meters, pumps,
to note that, according to Soviet
filters, lubricators, stills and re¬
sources, 67% of the total savings
Edward Wagener Resumes lated equipment, domestic incin¬ deposits as of Jan. 1, 1937, were
erators, industrial, low tempera¬ held by 10% of the depositors.
Duties at Foster Bros.
The turnover tax, which is the
ture equipment, gears, automatic
TOLEDO, OHIO — Edward G.
main source of revenue, is im¬
screw
machine products, miscel¬
Wagener has returned to his for¬
posed on almost all consumer
mer j position
with Foster Bros., laneous locks and screws, fare goods. It is reported that the tax
Young & Co., 410 Madison' Ave* boxes, electric coin changers and often amounts to more than the
nue; after an absence of eighteen
In 1941, for
coin counters, testing and serv¬ cost of production,
months due to illness.
Mr. Wag¬
example, the tax on wheat and rye
icing equipment for internal com¬
ener who has been in the securi¬
amounted
engines,
and
battery
thirty bustion
years spent most of his time with chargers
and a general line of
Snyder, Wilson & Co., the name builders' hardware.
of which was recently changed to
The company's consolidated net
Foster Bros., Young & Co.
He
sales in T 945 amounted to $39,began his career with E. W. Wag¬
809,896 and net income was
ner; & Co. in 1917; and was later
with J. S.' Bache & Co,
846,607.
business
for
nearly
,
-
"
,,
to
32,000
Shares
5% Cumulative Convertible Preferred Stock
(Par Value $25
per
the
that the reconstruction loan of 20
billion rubles
(nominally $3.7 bil¬
success.
The people
to
upon
invest
month's pay,
This was a
loan;
previously Russian
a
lottery
loans
change since, it was for the
heritance of 500,000
plus accrued dividends from May 1, 1946
rubles, the in¬
heritance tax amounted to 238,540
rubles,
plus 90%
500,000.
over
high
One cannot resist
as
the combined Federal and
State inheritance taxes
Common Stock
in
our. own
country on a comparable estate.
(Par Value $1
Price
per
share)
far cry
State only
from such dealers participating in this issue as may legally %
offer these securities under the securities laws of such State.
may
be obtained in
any
from the early theory of
according to his need, with
some
Copies of the Prospectus
inheritance taxes,
public loans, profits taxes—all are
a
each
r
and
Income
$10.50 Per Share
form of labor certificate to
be used instead of money.
sians have, found that an
economy
May 14, 1946
Loeb, Rhoades & Co.
counting
measures
bor
were
The Rus¬
industrial
must have a price basis,
that modern methods
Carl M.
income on
performs, which in turn
he
work
depends in large part on the ef¬
ficiency of his direction and the
equipment at his disposal. Profes¬
sor
Colin Clark, a
well-known
British economist, has estimated
that the real income of the Rus¬
sian in tlje prewar decade, meas¬
ured by the amount of goods and
services which could be purchased
for a dollar in the United States,
or an amount of interchangeable
income,
the
less than one-third
was
income in the
real
average
for some
United States. Allowing
Improvement, it is apparent that
complete state ownership of the
means
distribu¬
of production and
itself
tion still has failed to prove
as
of
competitor
formidable
a
American industrial enterprise.
Collectivism
The Wave of
in all candor it must be
Yet,
a wave
kind
is
there
conceded
that
danger
great
of collectivism of one
another may sweep over
or
such
of
Movements
Europe.
magnitude cannot be dismissed as
politicians
of
whims
the
aberrations of groups
ly
the
or
that sudden¬
nowhere
of
out
up
crop
to
enthusiasm of large
capture the
multitudes.
significance
whose
provisions
probably was lost hi the recent
crowded
events.
Article XXVI
has the duty to
read; "Every man
work and the right
jo obtain em¬
require
ac¬
systems " and f accurate
of costs, and that if
to
receive
the
la¬
whole
product, it would be impossible to
maintain
industrial
plants,
let
.
guaranteed
economic situation;
found himself
right
unable to work the i
suitable
of
means
ex¬
constitution
The
istence.
the com¬
from
obtain
to
be¬
who,
everyone
his
of
cause
of any excess munity
the comment that this is almost as
Shares
100,000
at
his
ployment.
interest.
worse) it is stated that, on an in¬
Price $25 Per Share
for
Article XXIX was
In a study of public finance be¬ made up of one sentence; "Every¬
fore the second World War (and one has the right to rest and
And
another
article
I would say that if there has been leisure.".
have borne 4%
any
share)
of
75 %
about
plant or the great steel
Magnitovorsk depends
the amount of
tractor
In England, the home of politi¬
price, and the tax on sugar as high
as 85 %.
It is easy to understand cal individualism, the Labor gov¬
how much a tax can be used, when
ernment moves ahead with a pro¬
the authorities wish, to divert
savings for the expansion of capi¬ gram of collectivism. Czechoslo¬
tal goods, which is exactly what vakia, the Continental state mostwas done in the pre-war years.; A
Closely wedded ; to J our form .off
profits tax is an important part of
em- the national budget,
accounting political institutions,. has
for almost 12% of. the 1940 reve¬ barked on a broad program of
nues.
The profits represent the state ownership.
The proposed
earnings of the great industrial French
constitution
contained
trusts.
Recently it was announced
lion) was a
were
called
Holly Stores, Inc.
plain fact is that the Rus¬
in
the
Stalingrad
works
Empire State, Inc.,
tion controlling the
Building. He is also
General, New York
ties
obvious,
worker
ception, as we all know. Common
use of agricultural land and im¬
plements was general in Russia
in
to finance in¬
and
in Russia.
freedom
The
rule, private ownership is the ex¬
the
accounts receivable
vital
are
similarities. The greatest
are
sian
tives
The balance of pro¬
added to working
own.
our
ownership is the
War, the Philippine Insurrection,
World War I and in the last war,
Oak Leaf Cluster, and the. Silver
Star.
He is a Commander of the
the Russian economic system and
difference is the absence of politi¬
The Russian Economy
i
over
active stock which the company is sell¬
American ing to the underwriters will be
complex prob¬
While the differences between
my.
common
Drum has seen
in the Spanish
the many
lems inherent in a modern econo¬
leading forms of society, not as
they exist in textbooks or in the
minds of their protagonists, but as
up Russia's economy to a
very large degree Were part and
applied to the redemption of out¬ parcel of their way of life. But
standing first mortgage 5% sink¬ enforced collectivism had to be
He is the recipient of many ing fund bonds, 5% sinking fund revised to make it operate and
first pre¬ produce grain and other farm
medals and honors including the debenture bonds and
service
and is under no circumstances to be construed as, an offering of these securities for
sale, or as a solicitation of offers to buy, any ~of such securities,
The offering is made only by the Prospectus.
■
I
some
.pur¬
Trust Company.
holder of the Croix de Guerre.
Savings
which
Progress
(Continued from page 2640)
By
Lawyers Trust Go.
ury
Paths to Vninteirupted
.
Gen. Drum Elected
our
Thursday, May 16, 1946
was
turned down, not, I daresay,
of
cause
these
French Assembly
the
and
gas
be¬
The
provisions.
has nationalized
industries,
electric
the
deposit banks, the coal mines
and
forty-five of France's largest
insurance
companies.
>.
.
.
..
•
Why countries with democratic
traditions
statism
volved
the
willing
has
of
which
in¬
political
they
have
fast, cannot be understood
without
a
close examination of the
economic and political
these
prevailing
in
which time
does not
In
risk
to
elsewhere
loss
for
liberties
stood
are
which
tendencies
countries,
permit.
general, the spectre of large-
'
Volume 163
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4490
scale
unemployment, general deprivation and despair may be held
responsible. The hungry forties of
■;
i the
last century were followed by
social
changes and revolution in
f Europe; the dismal thirties of the
5 present century nourished dicta¬
torship and the totalitarian state.
What do these things mean to
us? I have no fear of a prolonged
period of unemployment if we in
:
.
of
than
less
occasion
18
months.
On
one
the
price of coffee was
cut in half in eight months, on
another the price of sugar trebled
in four months.
halved four times within
was
periods of two
times
and doubled
years
even
more
rapidly.
The
report of the Delegation on
Economic
Depressions
of the
ate
areas: were
potential to avoid further
We must, however, cre¬
better understanding of how
a
economic
©ur
it produces
^
society works, what
and how the rewards
are distributed.
The
I
■
■
on
a
of
number
on
occa-
inflation* In the annual report of
the New York Stock Exchange re¬
cently, I pointed out the danger of
doing nothing about the continued
monetization of the public debt
and advocated a national commis¬
to
investigate the problems
of debt and taxation. Since then,
the monetary authorities, because
of the public's interest, have taken
the
first
step t. in discontinuing
adopted during the war
to promote the Treasury's finance
program. Moreover, a committee
measures
lias been formed to make
ough study of
thor¬
a
fiscal problems,
our
to
school for
children to
unable to ob¬
procured
debts were unpaid
them,
the
were
farm;
increases
solely because
be passed on
can
the in¬
to the con¬
are likely to price the in¬
dustry out of business. Bituminous
general community. We can rely
on
competition to bring profits
down if they become unreason¬
able. It has been
natural
No
Let
add
clusion.
I
one
abhor
thought in
the
practice
apologizing for making
able
profit.
con¬
of
a reason¬
The fact is that the
on
their depositors; sav¬
large and small, were lost
and the plight of the paid labor
close
doors
ings,
the
on
farm
or
in
mine
the
was
often such as to make the incomeless farmer
ternational
seem
fortunate."
In¬
collabora¬
economic
in those which
backward
economically
were
weak*
or
Incidentally,
improvement; in working condi¬
tions and wages did not begin in
1932.
tion is necessary to eliminate or at
From 1914 to 1930 hours per
week were reduced approximately
least
15% and real weekly earnings in
these
modify
examples
of
extreme mal-organization.,
The
world, as Professor Clark
1940, is found to be
indeed a wretchedly poor place.
It is even more so today.
An
average real income below $10
>
observed in
a
manufacturing industries in¬
creased 22%.
Profits in competi¬
tive
are
industry
the rewards of
efficiency and of service
the
to
not
am
given
to
the
recognized
the
sound
American
common
people
itself, I look for
a
numerous
setbacks, our
the years, has been
a
nation, we are
today
the
world.
that
most
How are
this
rupted?
powerful
to make
we
is
progress
'
in
Sf
would
ture
the
dom.
question
faithfully the historic
of
is
and
cooperation
I
believe
This
of
the
world's
achievement
American
A standard of
living of $1,000
zation,
as
or economic organi¬
history since the first
World War has
amply
proven.
world,
we
must set
an
example of
democratic capitalism upon which
To strive
ceaselessly for a vol¬
untary unity of management, la¬
bor arid capital.
confused
and
everywhere
may
unhappy
per
erland.
Crying Need Is More Production
of the
use
of
war
loan accounts in
banks to repay government debt,
although this practice will reduce
the earning assets of the banks
and to some extent their earnings,
is the kind of courageous thinking
have,
must
we
v
:
The crying need of the world at
large today is more production;
our
immediate
concern
is not the
distribution of income. The capital
needs
of China
alone
stir the
This is under no circumstances to be construed as
an
offering of these securities for saley or as an offer to buyt
offer is made only by means of the Prospectus,
solicitation of an offer to buy, any oj such securities. The
or as a
NEW ISSUES
May 10,1946
•
.
•
v
.
imagination if only international
good sense prevails. Production
per capita is pitifully small; so
perforce is income. National prej¬
udices are sticky. The dwindling
of distances t h r ou g h speedier
travel and the opportunities of
Central Maine Power Company
Although the inflationary pres¬
sures today are great, we must
-look ahead. If a firm fiscal policy
is followed, with the budget bal¬
intellectual exchange cannot erase
anced and restraint upon the flow
the obstacles to international in¬
of goods removed as soon as pos¬
vestment and trade at once. How¬
sible, it probably will be not more ever, if we are successful in
bridg¬
than two years before the problem
ing the difficult period ahead, I
of finding markets for our vast
have cOfifidencn in the capacity of
economic productive machine will
peoples of good will to conquer
be
commanding our
attention. the devils of
misunderstanding
Already, there are a few signs that and
suspicion.
the veritable seller's paradise of
the past four or five years is A Better Understanding of Eco¬
about to give way gradually to a
nomic
Organization Needed
more competitive market.
Scarci¬
Reverting to the domestic situ¬
ties-are not-the long-term trouble
ation, a better understanding of
of our economy.
how our economic organization
Judging by the history of highly functions is imperative. The work¬
industrialized societies during the er has to have demonstrated
twentieth century, it is after our graphically that increased pro¬
immense productive capacity has duction is the soundest source of
220,000 Shares Preferred Stock 3.50% Series
..
$100 Par. Value
.
Subject to prior rights of present holders of certain classes of Preferred Stock under
the Company's Exchange Offer which expires at 3:00 P.M., E.D.S.T., May 20,1946.
Price $101.50
per-share,-
:
373,832 Shares Common Stock
$10 Par Value-:
•
_
•
'
Subject as to approximately 8,330 Shares to the preemptive rights of holders of the Company's
6% Preferred Stock and Common Stock which expire at 3 ;00. P.M., E.D.S.T., May 20,1946*
'
,
Price $28 per share.
,
been released that
will enter
we
critical period; for a long period
of unemployment is the door
a
which
through
v
statism,
the
of
right or left, will march. Unused
productive facilities, idle men and
idle plants, do not make sense.
I
am
inclined to think
learned from the past.
we
we
If
have
have,
the prospects for a period of pro¬
longed prosperity, on a scale far
surpassing any we have yet had,
seem
to be not only a pleasant
prospect, but within our reach.
International
Economic
Cooperation
i
;
I look for greater international
economic
we
cooperation,
must take the lead.
in
which
The World
Bank and the International Mone¬
;
tary Fund have shown the way.
When they begin to function, they
.will inspire confidence. The cred¬
it to England, debated too long
and delayed by a poor display of
tact
both
in
United States,
helpful. Let
a
lesson
England
and
the
will be exceedingly
us see
from
if
we can
economic
draw
history.
In less than twenty-five years, the
price of wheat and of jute has
during
been
three
reduced
one-year
by
one
periods
half,
the
price of cotton has suffered such
&
decrease three times in periods
*1
increased wages.
That has been
the story of economic progress and
will continue to be the story of
dealers in securities and in which stuff Prospectus may
:
authorities have had to
miners
to
provide
exhopt the
more
coal
for
necessary
reconversion and for
the export trade which England so
urgently requires. Nationalization
is no magic formula —this has
been
learned
everywhere it has
been tried,
I am impressed by
corporations
which, through
are
beginning to describe interest¬
ingly, and with a wealth of factual
material, the anatomy of business
economics.
To
undermine economic fallacies and
eradicate economic
concrete
most
facts
illiteracy, these
are
probably the
cogent weapons.
I would
point out that our form
society is based on voluntary
cooperation,
i.e.,
individualism
of
that must respect the
general wel¬
fare.
prises
Increasingly, leading
are
\?
.v'm
jj.' >7'
■/:
Stone & Webster Securities
H. M. Payson
Company
Corporation
^? '7*%r<,"
Corporation
& Co.
The Wisconsin
The First Boston
'
v-f>u"i"
■■
F. S. Moseley & Co.
Baker, Weeks & Harden
Bacon, Whipple & Co.
Weeden & Co., Inc.
Bosworth, Chanute, Loughridge & Co.
Bond & Goodwin
1
Paine, Webber, Jackson & Curtis
Cooley & Company
Chas, W. Scranton & Co.
R. S. Dickson & Company
Incorporated
The Robinson-Humphrey Company
Riter 8c Co.
Phelps, Fenn 8c Co.
(Incorporated)
Maynard H. Murch & Co.
The Illinois Company
Putnam & Co.
Maine Securities Company
Harris, Hall 8c Company
Schoellkopf, Hutton & Pomeroy, Inc.
Incorporated
Blair & Co., Inc.
*
Incorporated
E. H. Rollins & Sons
Whiting, Weeks & Stubbs
R. L. Day & Co.
?
H. M. Byllesby and Company
•
Baker^ Watts 8c Co.
Farwell, Chapman & Co.
<
Clifford
J. J. B. Hillicrd & Son
J. Murphy Co.
Rauscher, Pierce & Co. Inc.
an¬
reports addressed to both
their stockholders and
employees,
and
v"'1
Incorporated
thb huhiber bf
nual
organization
.
legally be distributed.
'vrv:
■
,
ings of leaders who preached that
it is only necessary to capture the
so-called surplus value or profits,
is now caught in a dilemma. The
ft
Copies of the Prospectus may be obtained from any of the several underwriters only in States in which such underwriters are qualified to act as
'
the spreading of economic bene¬
fit over a larger area.
The present government in Eng¬
land, having inherited the teach¬
;.
enter¬
considering methods to
convince their
employees of the
Ballou, Adams 8c Company
Auchincloss, Parker & Redpath
Alex. Brown 8c Sons
Incorporated
H. F. Boynton &
Co., Inc.
■
Chace, Whiteside 8c Warren
First of Michigan
Corporation
Incorporated
Qwtks H. Gilman 8c Company
Gordon B. Hanlon 8c
Company
Kirkpatrick-Pettis Company
Incorporated
'
F. L. Putnam & Co., Inc.
Richard W. Clarke
Reinholdt 8c Gardner
Corporation
George D. B. Bonbright & Co.
Harold E. Wood & Company
people
look with faith.
States, Canada, Australia, New
Zealand, Great Britain arid Switz¬
Bankers Association. The approval
As
the last best hope of a bewildered
worker per year (1936 prices) or
more is found only in the United
tention, although it, unfortunately,
is an unofficial group. I heartily
indorse the anti-inflationary pro¬
gram adopted recently by the ex¬
ecutive council of the American
is bound
government
to
more
lot of
population.
and the nature of its sponsorship
assures its findings of serious at¬
to
a
week per worker is the
81 %
increase
With the
of
powerful attraction for
all nations, for no people is irrev¬
ocably committed to any form of
industry,
produce more and
goods of better and better
quality at lower and lower prices,
if I may paraphrase a statement
by Mr. Ford..
which
(a
to have
To follow
of
assert
attainable), we can move ahead
to new high levels of production,
which means a higher standard of
living and the preservation of our
precious heritage of personal free¬
this way:
pattern
I do
be
sure
f
answer
as
sense
government, in¬
dustry, finance, labor and agricul¬
the
Itecomendations
I
production
cooperation
inter¬
not
of
our
surprising vol¬
ume
of
il¬
making
will
in real national income.
ditions have been the rule in the
profitable businesses rather than
to
I
that
spite
best wages and best working con¬
forced
banks
economic
and respected as nowhere else. In
progress, over
such that, as
Apologizing for Profits
me
on
prophecies, but believing
living ever attained by any peo¬
ple. Under this system, spiritual
are
war
ing and appreciation of how
society does its work.
the highest standard of
us
make
based upon a broader understand*
are
.:
;
Our competitive enterprise sys¬
no rival
anywhere. It has
and human values
part of the market which has been
using coal.
'
tem has
nomic fuels will capture a
large
To
literacy and thus strip away lay¬
ers of prejudice and
fallacy, thus
creating sound public opinion
national pol¬
monopolies.
given
their
and
our
icy to regulate industries that
coal is an example, for with the
experience we are going through,
we
may be sure that more eco¬
purchase
tain food other than that
5; dons voiced my sentiments about
the futility of shadow boxing with
sion
unable
boots, were unable to
or
their
lack of
f AXf/;
Inflationary Danger
have
clothes
send
they
living:
sumer
lead
inflation.
nomic
a
.Labor leaders who demand wage
crease
the price
League of Nations paints a vivid
picture of the effects: of these
fluctuations,
"Farmers in many
this country will but use our eco¬
.
earning
Among the met¬
of copper, and of
als,
three
community of their interests and
that of the business in which
are
2661
THE COMMERCIAL &
2662
Thursday, May 16, 1946
FINANCIAL CHRONICLE
has also moved down quite
sharply from its recent top;
~
the
Franco
is under
consideration by the United Na¬
tions,. Argentina has announced
the granting Of a credit to Spain
of $7,500,000 for the purpose of
buying food
supplies from. the
lending country, a United Press
dispatch from Buenos Aires stated
oh
April 26.
The same advices
also reported that legislation rec¬
ommending
the
resumption of
diplomatic
relations - with'- the
Soviet Union
the
next
is on the agenda of
expected
is
Deputies,
of
Chamber
new
which
to
-convene
month.
Bothwell &
Kilpatrick
Form New Partnmhip^
■
s6-caUed_ .test,
oii will be
The. Government bond market is now entering the
as the. .Victory Loan .2V4S and. 2%s fromi* now
;
Likewise, other issues, in
particular the 21/is due June 1959/62, and the 2V2S due _June
1967/72, bought along with, and art; some instances in place of, the
Victory' Loah obligations In i order to participate in the .sharp price
rise; will also be completing the; required six months holding period:
that makes profit's from these purchases taxable at a lower rate. . .v
ThC period that most of these speculative purchases- become long:terrnfax holdings.extends from May 15 through Juhe 5". .....
long-term holdings for tax purposes.
...
Jr.,
Kilpatrick,
have
a
ment business*
v
Ci Lester Emm^rt & Co.
HARRISBURG, PA.-^C. Lester
Emmert is forming C. Lester Em¬
mert & Co. with offices at 207
in the se¬
Pine Street, to engage
business,
curities
Mr.
in these positions
the deposit banks.
added to their holdings, despite the rising market for this obligation;
Even the holdings at the closo of January showed
a potential increase in the floaiting supply of only $1,11^,000,000,*
I
'
.
ihated^his position in this
own
The large
•'i
institutional buyers have pot yet entered the
market
have done some scale buying and
Offerings Wanted
Immediate
and despite the larger floating
upon
in order to obtain income.
As
a
,
than two months- how..
Appraisal
•
.
Complete dollar appraisal
issued each June 30 and'
December 31.
Closing Bid
Bid Price
5-14-1946 11-15-1045
Bid Price
12-5-1945
103.5
12/15/49/51
104.0
102.22
103.4
3/15/50/52
A04.2
102.21 v
103.7
i
2%:
due
•9/15/50/52
102.24
103.12
5103.14
9/15/51/53
due
due 12/15/52/54
2^% due
3/15/56/58
(3- 1-46)
(^ 1-46)
104.7
3-f t-46)
102.16 (3- 8-46)
104.18 (3-11-46)
•105.1
.101.11.
.
:
.
103.24
103.31
:
104.3
110.22 (2- 8-46)
108.14
1108.17
103.23
103.13
107,24
(3^11-46):
103.9-
101.16
1Q1.16
103.1
INTERMEDIATE BANKS IN GOQD POSITION
.
speculative buying at the time, of anil during the
Victory Loan in the Intermediate-term bank eligible issues, then the
holders of these bonds have either taken short-term gains, Or will
/ If there was
Appraisal
Our
,
following price trend:
due'
due
V%% due 12/15/50
Special,
-
2%
2%
experience and facil¬
ities at your
.
All-Time High Bid
Price and Date
Issu
2%
or
.
Thio ls indicated by the
Semi-Annual
Monthly
...
the bank eligible issues, with maturities of- less
have been .adjusting to the new conditions more
result
than 10 years,
J Valuation and
from
highs of^^Hy April has brought prices of some of these; issues
back to levels that are eVeh-lower than those prevailing; at thfe titrie
of the largep^bliC/Offering of Treasury obligations. . . . The first
issues to be affected^ by the debt' retirement and refunding program
of the GovCrnmeht, which brought about a slight firming of! shortterm rates were the taxable bank eligibles, particularly the inter¬
mediate-term obligations.
»
The larger return available in certif¬
icates relieved bhe pressure, of bidding up these middle-term; issues
.
Gladly
furnished
request;
the Govern¬
market since the ' Victory Loan Drive, the; recession
the
Weekly List
disposal.
:
bq eligible* for lorigM;erm Tosses; when rine" cbmpares- present| prices
of these issues with those prevailing at the time of the last public
loan."/,/.
It seems as though speculative positions in the! intermediate-term
bank
eligibles is now very small, ;whi'chT means
there
problem to contend with in these obligations as there
is in the restricted securities. J /. While non-bank investors are Still
is not the same
eligibles, these securities will not
be pressing' for sale as( wilh the speculative' holdings - of restricted
bonds that were bought purely for price appreciation, v.. . While the
excess reserve position of the* commercial bariks will no doubt be
kept within limits- to prevent these' institutions", from buying too
many of the outstanding eligible issues, there will most likely be a
large holders of the taxable bank
STROUDS COMPANY
INCORPORATED
,
v
.
PHILADELPHIA
,
Penny packer 7330"
order to
maintain income.
'
In view of the adjustment that has already taken place in
the imiermediate-term taxable bank eligibles these obligations
•
are definitely in a buying range.
Institutions that are in a -
continuation of the-movement into the bond-classification in
....
NEW YORK CITY
REctor 2-6528-29
.
private wires—
Philadelphia, New York
Two
Teletype—FIILA 29G & 297
0:
i
II,J •
bu^rig ^jof
'
.
V,
v,
i ■
l.r,. .
■ i
.
i,r
.ir
i
n ■ ■ I.,,,!,
,ii' nl, -j«
...r,
, ,
Trend of Interest Rates
position to do
should
.
.
these securities on a <
scale basis, taking advantage of price weakness to build up their,
holdings of these obligations.
\
f • ^t;
so
now
(Continued from page 2638)
banks for book credit. This ^re^
meridous increase in the supply
of money, and the
Reserve
ernment bonds. The decreases, in
reserves and deposits reduced the
policies of the demand for Government securiand caused the market; to
authorities^ caused inter- ties
continually, and tighten.
v
all along the line; The spectacle* of
The full import; of this little
ever higher prices for government demonstration of the control which
bonds became
a
commonplace, the Treasury can exercise over
Those •' who
had
insisted * that the money market through selecmounting deficits and mounting tive redemption must not be un-
totals inevitably would lead derestimated
by
bankers.
By
higher interest rates at last be¬ deliberate retirement of issues
came converted, albeit reluctantly/ held
by the; Federal
Resefve
to tlie reality of lower interest banks and the commercial banks,
debt
to
rates.
And
and
reversed
the Treasury reduced reserves
what
then,
happened?
deposits which in turn
the upward
price trend of Gov¬
drop
>
and the interest rate be¬ ernment bonds!
Debt retirement has thus be¬
gan to show signs of, life and
vigor. What does it all mean? Is come a powerful instrument ♦ of
the' interest rate getting ready to quantitative
credit control and
return to those dizzy heights of this power is in the hands of the
4, 5 a rid 6 % of blessed memory? Treasury. Furthermore, the Treas¬
.Has the Treasury lost the close ury has great flexibility in this
control
of the money
market respect as there are many issues,
which it has had since the war and maturities, of Government-is¬
started?
sues
and
the Treasury knows
where they arn helJj Thd?rpcent
Decline in Bank Deposits
exercise of this power and; the
The
answer
is quite
simple. resulting decline in reserves and
During; the first three months of deposits clearly indicates that the
this year, we have had a reversal "honeymoon"
in
Government
of the process whereby these de¬ bonds is over. But does that mean
posits/were created,/For the first that the end draws hear;/that we
time since 1934, the demand de¬ should don mourning clothes? I
posit total turned downward. The hasten to answer my own question
Treasury deficit for the year will in positive terms. Certainly riot!
^
'V' >/'•''
l
-\r" ■ ■'
*
w ;i
be less, by several billions, than
Dejbt Retirement Only; Patt fof
anticipated; The outlook is for a
Debt Management
;'
balanced budget in 1946-47, if the
If debt retirement were alt that
Congress will only give a little
cooperation. This all means that there is to debt management a
the Treasury can safely use a part
counsel of despair might be in
of* its' heavy cash balance: to re/ order. Certainly it would be a
tire selected portions of the debt. bitter paradox for the bankers' of
The > Administration
is
worried America if the more conservative
about the possibility of inflation the Government became, the more^
arising from; the,- expansion ;of debt it ;paid off,'the lower the
bank deposits so' it is the most market price of Government bonds
natural thing in the world for would: fall! To paraphrase "Lil
this money to be used to redeem Abner" of the comic strips, that
securities held by the banks and would be "confoosin? " but cer¬
the
Federal Reserve banks. In tainly not "amoosin'"!
; •
«
}
Government bonds began to
in price
While-there has been a great supeculative rise in
ment bond
practically all issues.
technical position of the 2^s due
est rates to drop
Taxable e ligibl e s harimiit
firm bids on
r *i mi
.
are
sharp sell-off frOih their best
supply, which may
temporarily carry them lower, they are in an accumulation area. . . .
Scale' buying should give-investors a very satisfactory income. . . .
The technical condition of the market will continue to improve as
speculative holdings-of these- issues are taken over by investors.
. .
Interest rates Will continue low arid funds in the hands of noii-bank
investors" are more than large enough to absorb the increased floating
supply of these bonds* ...
»
Price weakness from present levels should be taken ad¬
vantage of because this will bb a gbod'buying opportunity. .
CERTIFICATES
favorable
.
The restricted bonds have had a
TRUST
the
savings^ accpunt^ shouldv be doing;^^ scale/
expenses of
.
sizable way, although they
a
levels of the year,
EQUIPMENT
Because of
this bond.;;
restricteds seen attractive
1
'
*
Sept. 15; 1967/72 and; the recent price, recession, this^ issue is im a
buying range...
Commercial institutions that heed income to cover
investment
business*
^
RANGE'
IN BUYING
definitely watching price movements very closely. . . . It is quite
Prior thereto he was manager for likely that these institutions Will be interested in listening to offer-:
the Harrisburg area for Warren ings, hear these levels, but may defer Sizable purchases until? there:
W. York & Co.
In the past he is more evidence- that there .may not be* more panicky seilihg by
some of the speculative holders of the restricted obligations....
his
,
complete- liquiclatibn of these
large buyers on sidelines
m
conducted
The
sold by present owners..1
.
.
commerciai banks) fully elim-,
security....
holdings in the 2%s due Sept.
15; 1967/72 would not be too sizable to be absorbed by the Icommerciaf bankg everi under present conditions. . ; . Such is riot likely
to he the case since a substantial, amount of these bonds will not be
-
with losses/ ranging; frorti a, few thirty-seconds
-. The market Was orderly^and Volume HghtJ
principally to small purchases by large
.
(other thun the
if every holder
'
confined
long-term coupon rate.
.
.
.
.
buyers; and purchases by small investors; . ; . Some firmness was
evideni follewing announcement hy tho British-PL a reduction--in the
Emmert
!was formerly with the U. S. Navy.
point.
business
With
| ■>||
ocrier large holders'
Undoubiedly changes have taken place
of January, with the belief that
£
,»
what develops in the nexk month or
six Weeks, since' many' of the * appreciationrmiiided holders of .Government obligations can- ;dispose of their issuesj and' pay
taxes, on the basis of a h)ng-term:capital:gairiv
: J
r
.-4
to about one
107.19
106.29
.
since the end
will' be interesting to see
tions drifted; towei/
since 1928.
106.25
of thi^ security were other investors,
with. $472,000,000^ life insurance companies $301,000,000' and' Gov¬
ernment agencies and Federal $238,000,000. . .
'j- /
1"
Tne;
partnership under the
name
of Bothwell &: Kilpatrick.
Warren Bothwell, prior to enter¬
ing the Service,: was a member
In'anticipation of the six months' holdingsperiod coihirig.to an
of the firm of Carey & Bothwell}
established ins 1910. A. J. Kilpat¬ end, the market turned .'dull last week, with dealers and investors
largely on the sidelines. ;. 1 The bank eligibles and restricted obliga¬
rick, Jr., has been in the invest¬
formed
-
a
:OTlfiEli HOLDERS
:
Since the market turned down on April-8 and went into- the spur
that erased a", substantial amount of the recent price rise, there nas
been a cautious and waiting'attitude among dealers and investors. .V.
This attitude-is based-largely; oh the- belief that ,it would. b,e advise
caution rules market
able to withhold large-scaleu pu'rchaises, until there was: an- oppor¬
Both- tunity to gauge the amount of selling that plight- take place, once
well, Lt.-CoL AUS, recently re¬
these; securities became long'-terrn'tax holdings. ,. . // v
•
cently released from active duty,
The market isriow face to face with this problem and it
Av J.
/'
.
.
.
AUGUSTA, GA.—Warren
and
Price
.
bank eligible" issue;; followed more
closely the pattern of the restricted obligation in its recent price ad¬
vance, making its all-time high at the same time- as the ineligible
2 '/>s.
i-. This cOuld have been dpe in "some measure to speculative
buying.
However,; if that werb the case, then these purchases fpr
gain; ma tie during the Victory^ Drive have netted * present holders
very'little. * V 4. The 2V2S due Sept; 15;; 1967/72' is' a small issuer out-,
standing;only in the amount of $?,716,0.00,000i \vith the latest TreaBvuva«^ (jan* 81/1046) showiifg that $1,606,000,000 Were" dwned
by the commercial banks. . . .
although
This obiigatiori,
:
period1,'*
109.19 (4- 6-46)
9/15/67/72
2V2 % due
By
.
*
,VV
All-time High Bid
Closing Bid Bid Price
Bid Prifce
Issuevr.*-\:K-f>.K^rT£-^-'~Prlce end I)ate-- rf5-14-1946 11-15-1946 12-5-1945
»,
"OurRepfirte^
regime
.
Loan have been as- fol¬
-iv!;:)e'/vv.V.*:: •'
'
lows:
administration
the
when
Just
of
issue since the Victory
movements of this
Argentine Loan to Spain j
be acquiring
...
/ The longest bank eligible bond; the 2%% due Sept. 15, 1967/72,
/
>>
v
-
v
redeemed
But; as you; well know;; the
securities, con¬ monetary / authorities,, including
centrating
on v issues
held by the Treasury, have many other
banks. Actually,- 87% of the total
money market weapons and con¬
of securities paid off was' held by
trols at their disposal. While there
banks. Deposits in the reporting
might be argument about the ef¬
March %
Treasury
the
$2,800,000,000
of
in 101
leading
ficacy of some of the qualitative
$2,457,000,000 dur¬ controls
theyhave • available,
ing the three weeks covering the surely there can be little , argu¬
March redemption.«The New York
ment about the quantitative' effect
member
banks
cities dropped
membefr
banks
had
tor increase
of
borrowings at the Federal
Reserve
banks
by
some
their
$300,000,000 to partially offset
Reserve
the
J
decrease; iri Federal,
System holdings of GoV1-
$379,000,000
reducing or increasing
ber bank reserves
Reserve
banks,
*
mem¬
at the Federal
and the Federal .i.
,
Reserve system now
holds neaily
.•
•
,<■
v j.
^
THE COMMERCIAL & FINANCIAL^ CHRONICLE,
$23,000,000,000
^securities*.:
,,
Government
of'
c
il
£
It is my. considered opinion that
monetary - authorities .are
the
tion; inherent in the $177,000,000,000* of deposits and currency in
as
circulation willvex? the monetary,
ized the Government bond market
for
authorities
-r
years
to:
>
rapidly.'as expected;. The stead¬
ily rising'prices which character¬
until
come.
about
a; month
-
Treasury is in a position to use ing and other aspects of debt if
surplus' cash, to* retire^ a- part of management. They very properly ''
•reserve .the
right to "cut dheir
the balance into (a) short-term
cloth to fit." It is increasingly,;1
.
its maturities and to either refund
ago,, pre¬
Nonetheless, it is my opinion that sented anticipated developments issues or into (b) long-term is¬
tliey will be forced, whether they in this respect,. In fact, it now sues. Refunding into short-term
like it or not; to adopt measures seems clear that the sale of the issues would place heavy pressure
which will maintain money rates Government bonds held for speci¬ on long-term yields and cause a
-fairly;close: to present; levels and fic purposes by corporations and possible further increase: in the
war, open market operations were at the same, time prevent further individuals: wiU;bel in-general, ■; a price of' the longer issues. If, on
utilized to provide the commer¬ increases in the volume, of bank gradual * process; certainly it will the other hand;.conversion.is into
credit ..through the acquisition of be, as long as, prices; hold: up on 2V4% issues, long-term rates will
cial
banks
with
adequate
re¬
Government issues. The actual re¬ Government bonds-It is, .however, not' change very much. To go a
serves, so that the ever-increasing
duction of the swollen volume of quite possible that in the: near step further, refunding into longvolume, of
Treasury
securities
could be absorbed without bor¬ deposits can then be accomplished future, .when* the* six-months tax term 2 Vz % coupon issues - would
rowing and' so. that* the increase through a carefully managed se¬ period on the Victory? Loan? has/ probably - cause a: moderate drop
lective redemption program on the
elapsed, a number of. the free in the price of present Treasury
in currency in circulation and the
.riders will liquidate their hold¬ issues ineligible for bank
decrease in the monetary stock part of the Treasury. . ,r ' .";
purchase.
ing and cause further unsettleof gold could be
offset, now the
:
;
Banks Will Not Increase - ;
Conclusion
'
ment in the ' market.
/%'*•;*•
aim is to help prevent inflation.
Holdings of Governments f
;. Parenthetically,
5, Foreign. Foreign loans? will
I do not forsee
The public has become restive
a great, demand, from business or
The. net effect of the develop¬ be
largely channeled through the
under wartime
restrictions
still
ments I have described is that the International
Bank for Recon¬ industry for bank credit of a con¬
in force, a full year after V-E Day.
commercial banks of the country struction v and
ventional character^ Therewill;be
Development* By
Business men have become very
Have ceased to be buyers of Gov¬ the end of 1946,< the Bank should a; considerable demand fof con¬
vocal in their opposition to bu¬
ernment obligations; that is, while
begiti .to Offer*, its own issues^ or sumer loans, but the keenest com¬
reaucracy, benevolent or other-?
the banks will continue to make
fpreign - securities
bearing: ; its petition you have; ever; known
wise. .The OP A is having harder
changes in their portfolios, on bal¬ guarantee; in the capital market will keep these rates down.
and harder sledding in the legis¬
ance they will not be able to buy If; the7 international
A. careful study of all the fac¬
political sit¬
lative halls, in the courts, and' in
additional Government securities uation can be
stabilized on a basis tors involved
genuinely worried about the in¬
flationary dangers inherent in the.
;huge increase in the volume of
bank
deposits and currency in
circulation.; Whereas" during; the
therefore, for bankers..,,
necessary,
to
continue
their
and the
nance
close
studyj of
Governmentali-}
developments in
,
market..
money
ft.,
In
closing, may I emphasize
that, at present, changes in sup¬
ply, .demand, and credit policy
factors are taking place. In jfche
entire situation, however, there J s
one
thing of which we can _be
certain:
The
Treasury
does
not
want ■( materially
higher interest
rates—and it is still in complete
control of the money
,
i
'hv;-:
*2663-
and capita!
markets. Therefore, the rate pat¬
tern
on
Government
securities
.
will continue to range
,
'
the
black
markets.
these
Under
in
.
the
in
This means that which will give world confidence;
circumstances, the monetary* au¬ from now
on the capital market
this demand on our* capital market
thorities': reason, what could be
will be on: an investment basis
may total several billions of dol¬
more* logical, what could have a
which makes an analysis^ Ofv de¬ lars.; But that
is a big; IF. The
greater psychological effect* than
mand and supply factors neces¬
whole,; thing, is problematical, and
the redemption of' Government
sary. ; So', let us now take a look
it is quite a
way in the future.
securities on a selective
basis
at the probable supply and de¬
6.. United
States
Treasury.
Whichv reduces reserves and" der
mand in the capital market to see
posits* tightens the money market, if a substantial increase in the Higher: tax revenues; reduced- ex¬
causes Government bonds to drop
penditures; prospects of:4 balanced
level of interest is indicated" by
and brings about a moderate in¬
budgets, and? unexpectedly slow
the economic developments which
sale and redemption, of. Govern¬
crease in short-term rates?
are
"just around the corner."
;THe ending of Treasury "deficit Everyone - agrees that: unquestion¬ ment bonds by the public and
financing. through the sale of ably the volume of funds, seeking corporations* have removed the
as
past.
.
Cv
and
,
*]
*
Story Now Is
,
.
LOUIS,
MO,
Chronicle)
,
Samuel-J.
—
*
Story has become associated with
Blewer,
North
Heitner
Fourth
the
in
past
Tegeler
years.v'
on
'^320
Story
•,
with Dempsey-
was
•
number^ of
:
Co. for
&
Glynn,
&
Street.. Mr.
a
*
*
■
monetary
authorities have made it clear
v-
(Special to The Financial
ST.
on
financial
ernment
•
,V.\
-
.,
2%%-^pn
eligible
With Blewer, Heitner Co.
foregoing
Treasury.debt; re¬
tirement and refunding policies.
As to "what these policies:: will be,
the Treasury " cannot*; now say.
Secretary Vinson and other Gov¬
from %~of
to
non-bank
Samuel J.
summary
thie; market'
certificates
on
bonds., '•
indicates that the sup¬
ply of capital and credit relative
to the probable demand will be
very large. It also indicates: the
almost* complete
dependence; of
.
,
the
1%
long-term
■
n
"
I.
New York Stock
*r
-
Exchange
Weekly Firm Changes
*
^
bonds to the banks and the
con¬
ending of the constant
increase in deposits, has had a
sequent
profound
investment will be enormous. So,
time
do not have to waste any
we
the supply side. The probable
demand for the swollen supply of
on
effect on the money
Treasury policy of jnvestmentcapital is the $64 ques¬
redeeming securities held primar¬ tion. Let us survey the * larger
ily by banks, which causes an ac¬ potential demands,'one by. one.
tual reduction, of reserves and
1. Corporations;
The
business
deposits, naturally has had an ef¬
hutlook is good and there Will be
The
market.
fect on interest rates.
Clearly,1 the
classic inflation weapon" of: con¬
traction. of
increase ; of
the
credit
base
the I interest
and
rate
to
j ireduce the volume of bank credit
has been invoked^ although, to a
very: limited* degree; Now,, un¬
doubtedly, the question uppermost
ini your mind is whether this all
means; that
the policy' will be
continued,, and whether we should
expect' a material
increase in
irtoney rates in the near future.
In this connection, T think if is
safctq
say- that, unless the Treastiry:and' Federal' Reserve' jauthqr4
itiqs^ sharply change* their policy;
necessity
,
borrowing
Even
,
more
standpoint
further
in
be
tie
of
interest1 rates
has
come
to
No? Prospect of< Materially
Higher Interest- Rates
;
'This' does not; mean, however,
that we are confronted with the
prospect of: materially higher in¬
terest rates. Such a development
would be contrary to the interests
of the Treasury, • which would
bave to weigb the 'effects" of such
change on? the debt burden and
op
refunding operations; 'Obvi¬
ously the Treasury cannot want a
materially .higher
interest., rate
pattern; and let me assure you
that if the Treasury doesn't want
it; we will not have it!
and consequent drastic decline in the* pfrice of Government
securities at a time, when com¬
mercial banks and. savings banks
hold, more than 45% of. the total
of. $275,000,000,000,, and the
insurance companies hold another
debt
10%
would have
a
serious effect
■oh many of these financial insti¬
tutions.
Clearly, the Reserve *
au¬
thorities cannot adopt the quanti¬
tative measures of
which they
cause
credit control
used in the past, be¬
the consequences of a ma¬
terial increase* in rates would be
far
more
Construction.
2.
<
qf
materials; and- skilled' labor
,
building
solved*
.
industry. will y- not
overnight;:«Higher:
be
_
how
to counteract the forces of infla¬
•
3ist.
■
which
-
.
'
;
m. :
I
-
Chattanooga
Mortgage 3% Bonds,.Series B
;0.
-;.v?
Dated February 1, 1946
will? undoubtedly act as a r brake
Due February 1* 1986
on
r
'Principal and IntemtiitncottdStionaily gvaranteedihf endorsement'
•
tyLouiSviife and Nashville'Railroad Company.
\
-
k
,
f'
i
.V&&
.
-J j
C'
TKe issue* sals
,
r
3i States
and
:
'
-
-
C''
vtM"
4
'
'''p?''
o
.
/'r
<
'J )
and^guariuty of these Bonds are subj ect to authorization
by thrliiterstate'Goim^wU
i-
'"
;
'
.
^'
.
.
Price 100% and aeerued: interest
Municipalities;
Deferred construction will have to
be financed at
This will
surplus tax
new
ings, etc.,
of
revenues
,
'
•
5-
.'.'-a',"-v;:;h.--■"
■ •
?-\v
Corporation
Eastman, Dillon & Co.
Kidder, Peabody & Co/-
Lazard Freres* & Co.
highways, public' build¬
Merrill
financed by the sale
are
bonds, there is
material- whether
a
Lynch, Pierce, Fenner & Beane
previously
States" issues;*
demand for
Stone. &'Webster Securities. Corporation
political
own
acquired
* ;•
Salomon Bros. & Hutzler
Govern¬
these
subdivisions sell their
4.
-
The First Boston
capital In. this respect, it* is * im¬
or
'/■ i''?
during; the
present1 holdings of
ment
Copies of the Offering Circular may be obtainedfrom any of the several under*
Writers only in States in which such underwriters are qualified to act as dealers \
in securities and.m<whuh such Offering Circular pidy legally be distributed.
'
>Qf course, to the extent that
war.
the
<
Hornblower & Weeks
Paine, Webber, Jackson & Curtis
issues
United:
L. F. Rothschild, & Co*
-"
;
Schoellkogf^ Hutton. fePomeroyjTnc/;
Shift of Government Securi-
ties.
.Likewise,-
Riter & Co.
corporations and
investment. These have not
„To be sure,; the problem of
.
■
:
■
porary
,
changes:; DanieL G.
partnership
in Garvin* Bantel & Co. on March
undSrsignefwhoare registeredMalm imsecurUies itrthis Statei
First
,con-
were;
*
-
Condon retired from
& St. Louis R ailway
-
which; how plague and retard the
which,
-V
the-
The Nashville,
The; shortages
Utilized.
j
announcedy? the J iollowing
weekly firm
,
j
individuals,have substantial hold¬
methods
,
long-range, policy with respect-to
the
$15,000,000
market, the proportion- of bonds
will probably be small-
issued
serious than is generally
Other
a
■ts-
dq issue new. securities, they may
Very well be commonI and' pre¬
ferred stocks. With a boiling, stock
of a
qualitative nature will have to be
realized.
to
ite.t i
higher price levels.
require more borrowing
than would be necessary at the
.pre-war price level. But, I must
point out that political, subdivi¬
sions in general hold a substantial
backlog of surplus funds, includ¬
ing large holdings of United States
-From anbther standpoint* a ma¬
terial increase in money market Government1 bonds, acquired with
rates
commit" itself
has v
:':May-10,194^
volume, also. Of course, ulti¬
mately there should^ be a ; sub¬
stantial demand
for
mortgage
money. But may I remind you that
the competition will be . very, keen
for
these
mortgages,, Savings
banks, insurance. compani es ,
private lenders and the Federal
Savings and: Loan' Associations
.will be. right in there .fighting for
the available supply.',
end'or is^ very near it;
in. fact;
now,
the interest' rates, redemption, refund¬
banks,
.
corporations,
in
general, ^ have
cash; balances and large
holdings of securities in various
Unused reserves. And even if they
and that the decline in the longerterm
now
not
an OjferingiCircukft Thq Offer-oj thess Bonds is made onty by means of, the Ojfering Circulat%
should be read'prhr to any purchase'of thtse Bonds. This isipublished on behalf of only
t^ose qf .
'
sjtruction cpsts^ and; selling* prices
an
cannot
future*
The New York Stock Exchange
occasions that the Gov¬
will
ernment
'large
already
passed* the
lowest; point* in short-term rates,
have
we
near
important: from
some new
will
the
numerous
Treasury
This is not
f
issues. But* the demand
relatively small because
for
ings7
come
of
Government;
securities
purchased for tem¬
into the investment market
.
R, S, Dickson & Company
-
Incorporated
j
;;
.The Robinson-Humphrey. Company
-
;
.
.
*-.>'* Steiir Bros. & Boyce
THE COMMERCIAL
2664
(Continued from page 2639)
ing
To; guarantee;
gap
libriuhi,
Theodore Roosevelt is
quoted
can
in
'
with
accordance
available goods;
(c)
the
./
to abolish gradually the
foreign exchange restric¬
,
organization.
tion
and
the
Control
budget %wilL show a large
between receipts and expend¬
The Increase in Circulation
The
itures is thus not disturbing; but
of more significance is the direc¬
to keep the money income
(b)
shrewd aphorism
of us are bound
to meet up with as we journey through life.
But there is one place
where a man can't be a leaner and make good—that's in a sales
up, but I'll be damned if I'll carry him!" f This
apply to many different circumstances that all
man
to balance the budget;
(a)
having once said, "I'll pick a
as
dynamic
equilibrium it is necessary:
JOHN DUTTON
Thursday, May 16, 1946
Dutch Postwar Reconversion
Securities SalesmairfsComer
By
FINANCIAL CHRONICLE
tion
public finances
develop., After ,the first year of
emergency finance and
money
purge, the financial as well as the
issue:
to
paid into the savings banks
an
important increase
during recent months.
sum
showed
under ficticious obligations to anyone.
They say money isn't the only thing in life that counts, and of
course no one doubts the truth of this old saying.
But a salesman's
l:
time is
The way he uses, or abuses his
pretty important asset.
a
time, adds up very neatly to the sum of the pleasure, and the money,
that he gets from; his job.
That's why it's important that no one
else around the offic'e abuses YOUR TIME by making selfish demands
It is one, thing to be cooperative and friendly, but
times when a man has to say NO and say it with a capital
upon
it.
there are
N.
^
give a review of the financial sit¬
uation, which showed a deficit for
1944 of fl. 2,186 million ($800 mil¬
lion) on a total expense of fl. 3,712
million
June
($1,400
million).
On
30th,
1945,
the
floating
Banks
consumating the transaction itself.
in
since
amounted
November
December—-
increased
fl.
to
2.2
1945
was
fl. 3,000 million
($1,200
If
($1
from
billion)
fl.
to
Notwithstanding that all stocks
are depleted and that there is a
real scramble for goods, one can¬
not s$y
2,500
of
in
his
majority urged
large
a
Finance
most economy, admitted
On the
mes¬
the
ut¬
that dur¬
ing the transitory period with im¬
portant deficits, the monetary sit¬
budget has still to be presented uation needs more attention than
sitting at your desk trying to figure out an important deal, to Parliament.
in ordinary circumstances.
The
middle of what you are doing, some pest comes up
The aim of the Minister of first • period after the liberation
to you and asks you to do him an inconsequential favor, that bird is
Finance is to cover the budget needed a large bureaucratic ap¬
stealing your valuable time and your money. That's why you don't
Thus the Military Ad¬
deficit of 1946, 1947, and 1948, by paratus.
want leaners. around if you are a sales manager-—your good men are
the savings of the people. But on ministration, an emergency gov¬
too important to you.
And if you are a salesman you certainly don't
the other hand the Treasury sub¬ ernment, established for the pe¬
want them around—they have a habit of contaminating others.
A
sidizes (as is the policy of other riod of occupation of the country
man who has developed strong work habits can lose them easilycountries, as England, France and by the Allied forces, caused an
all he needs is a little encouragement.
It won't be long until one of
expense
estimated at nearly fl.
these fellows will have you; doing what Teddy said he wouldn't do-^- Belgium), the rationed foods with 70 million
($25 million). This ad¬
about fl. 600 .bullion ($150 mil¬
you'U be carrying him and you won't be getting any stronger while
lion) a year, in order to keep ministration is how liquidated and
you do it.
,
the Minister promised in a short
prices low and thus to prevent
time the liquidation of; 27 depart¬
price-wage increases that would
ments. Considering that the Com¬
10,000 cases still await disposition otherwise become inevitable.
mercial Department on May 1st
at this time. The Associated Press
The base of this budget policy is
1940 employed 1963 officers, on
also said:
weak, but one has to keep in
The new board will be composed
July 1, 1945, 14,000, and on Janu¬
mind that far above the financial
of 15 members, one of whom wall
ary 1,1946,11,772 officers, one can
^Commissioner of Internal Rev¬ serve as Chairman?- Mr. Nunan problem ranks the aim to restore guess in what manner the bureau¬
as
soon
as
possible—even sacri* cratic
enue, Joseph D. Nunan, announced
said it will consist "primarily of
apparatus—which, involves
ficing othodox budget and finan¬ a
on May 7 establishment of a ne\y
cost of fl. 1,200 million ($485
persons 'with/ hroadjr&xpc^^
in cial
'principles—the*economic l|fe
Board to handle applications for
million) a year £< (that is about
accounting, taxolaweor economics
of .the so greatly damaged coun¬
Refunds ; of excess profits taxes
twice the total budget 10 years
and will beiappointed f?om exist¬
try and to repair her industrial
under Section 722 of the Internal
ago)—has grown. It is of the ut¬
ing bureau personnel as well as
equipment.
Revenue
Code,
the Associated from other sources."
most importance that this be re¬
He said it
Tress reported from Washington.
duced to a level that the impov¬
would take over functions now
Economic Progress Relatively
Many large taxpayers have con¬ exercised by the audit review
erished nation can bear. It must
Good
tended that Section 722 has been
be said that even the i: socialistic
divisions of the income tax unit,
Owing to the traditional sense
dlmost inoperative because of ex¬
cabinet is working, although per¬
of the Dutch people to put its
cessive
administrative
caution. and Jn addition.. review field rec¬
haps not hard enough, to reduce
ommendations in unagreed cases. house economically in order, and this bureaucratic
^Ir, Nunan admitted that about
apparatus. The
through the efforts of the Minis¬
socialistic Labour Party (Partij
try of Reparation, headed by the
van den Arbeid) is urging, no less"
world-famous engineer, Dr. Jo¬
than other parties, a less bureau¬
hannes
A.
Ringers, builder of cratic
system. It is highly desir¬
Amsterdam harbor and of the
you are
and right in the
New
'
other
money.
fl.
the Parliament, which by
sage to
the typical inflation psy¬
chology prevails: i.e., when peo¬
ple refuse to hold cash and try to
buy commodity values to safe¬
guard themselves against the dim¬
inishing
purchasing power
of
million ($600
Minister
me¬
dium of exchange.
1,500
million). This defi¬
cit-financing cannot go on. The
diminished
also an indi¬
confidence of the
of. the
are
public in the stability of the
billion
Bank
22.9
figures
'
26.5
22.6
20.1
February
($840
million)
on
April
1st,
against which the Government
deposits
with
the Netherlands
million
13.1
12.7
9.3
January, 1946-
cation
10.-
2.1
5.8
"
-
fl.
to
1945,
These
Banks
(in millions florins)
s.
October,
($420 million), has
($3,850 million), the provisionary
budget for the second half-year of
in constructive thinking is not wasted.
involved
been
has
than
1945
1,100 million
debt amounted to fl. 9,500 million
The million), compared with fl.; 1,600
top producers in' every sales organization will verify that their best million ($600 million). The deficit
days have been when they planned their work.
A new approach, a had to be covered by the in¬
constructive idea which has been considered from every angle, and crease of
savings-deposits with the
thoroughly thought through, before it was attempted in actual prac¬ Postal Saving Bank and postal ac¬
tice, has sometimes meant more effort and solid concentrated work, counts. As for the year 1946, the
Time that is spent
'.'=
December
Paid into
Paid into
Post* Sav. Oth. Sav.
•
«r-to be constantly
be
to
This cannot be the reason for the
increase of the circulation as the
put the house in order
of
said
preference of the
for' cash above deposits
public
and to live out of income; this to
something only
prices.
be accomplished by the adminis¬
they never get around to it.
If you have one of them in your office
Let me review the development tration as well as the
man in the
you won't have any trouble discovering him.
You'll be so busy
helping him get started that your own day will be half over before regarding these three factors. It street.
is easy to understand that a bal¬
But as
long as the Treasury
you know it.
The best thing to do with such a person is let him go,
and the sooner the better.
Selling is one line of endeavor where; a ancing of the budget in a totally spends more than its means, either
man must be his
own self-starter.
If he can't work out his own looted country as the Nether¬ from taxes or from private sav¬
lands, devastated in the east and ings, the money-income will be
campaigns, and see to it that he follows them through, the best sales
the south, 10% inundated in the
greater than the real national in¬
manager in the world won't be able to do it for him.
north and the west, is an im¬ come,
causing an increasing in¬
There are also customers that want you to carry them around
mense task.
Apart from this ,the fluence towards higher prices,
on your back.
If you acquire too many of them they'll break your administration was
totally disor¬ that must be met by more des¬
back.
There are people who expect a salesman to cater to them in
ganized, as the country was' for perate and therefore less efficient
a manner which is out of all proportion to the value of the business
more
than a year cut in three price-control.
which they can offer.
If you rendered the service to all your, cus¬
parts by war circumstances.
tomers which they believe is coming to them you would need 48 hours
Bureaucracy Must Be Reduced
Not before December last was
ip every day to do it. Again, the best thing here is, get nd of such the Minister of
Finance able to
The banknote circulation per
pn account.. Time is much too valuable—-and peace of mind likewise
people who would like to do
The world is full of
banknote
the
often
after the money purge.
this main
on
of
is
caused by the
in which the
economic aim meet
increase
circulation
,
hand, there is no
tendency to save money. The sav¬
ing campaign of the Minister of
Finance, inaugurated along the
British pattern during the war, is
meaningless in a looted country
like Holland with a population
that is highly individualistic and
eager to replenish its wardrobe.
The desire for a well-filled ward¬
robe—and
generally to fill up
equipment—was and is
characteristic of the mentality of
.
private
the Dutch
A
people.'
imminent cause of an
more
inflation
consisting of
—
hancement
the
of
an
en¬
price
increases
general
level—lies in the wage
last year. Owing to the shortage of
skilled labor
and the! rise in
the
of
costs
creased.
This
living, wages in¬
was partly neces¬
The expenses for the week¬
sary.
Boarifto Handle
ly rations (of about 2,200 calories)
plus the cost of dwelling, gas,
Tax Refund Requests
electricity and other necessities of
life were for an average family of
four persons at Amsterdam about
Lipe -Rollway Corporation
famous dike through the
zee, it may be said
after the liberation,
Convertible $1 Preferred Stock
Class
"A^Stock
revival
the
in
ZuyderT
that one year
the economic
Netherlands
has
made more progress
than in any
occupied country.
Indus¬
try i$' working 60 % of normal
capacity with good prospects to
increase production substantially
this year. The food situation has
improved so much that the coiin*
try this year could be indepen¬
dent
of overseas' imports with
other
'
'V^
''r »**
-
'r
'
(
'
'
•' i
'
'
Circular
'
!■>
n
*'»
%
-
1
'l\r
"
on
request
N
'
"
w
"J /
^J
~ '
v"v,: / -'
Herrick,Waddell
55 LIBERTY STREET,
**
)c
'
&
k, *'
^■ V /
'
"
'*
[v,* *-ir ^
Co., Inc.
)NEW YORK 5, N. Y.
the
exception of grains,
imports
100
that the'cabinet
able
this action.
the money purge may
^
yf-
•'.[<<
,
.1*
'
1 »-u
,'7
American
Fruit Growers Inc., Com*.
Arden Farms Co.,
Fullerton Oil
')[[
f
m/
11
I
'
\
PfA
There
J
other
still
Co., Com.
-
V5
/
Ji
WagenselterSDurstjnc.
626
SO. SPRING ST.
TRINITY 9761
LOS ANGELES 14
'vv •
Market
']
'
v
/
1
,
'
Teletype: LA 68
Quotations and Information on all California Sacttrfflad
this
contrary
countries where these
an
to
year,
are
increasing burden for the
'
'
The emergency measures
of the
Ministry of Reparation have been
immensely costly. In the reclaim¬
ing of the isle of Walcheron, for
of
about
million ($40 million) was
instance,
fl.
100
involved
an
amount
Minister
Ringers
told me lately—and the total costs
were a heavy burden for the Dutch
Treasury,- The fact that the com¬
—
as
tion and there have been no ma¬
jor wage conflicts.
The
prices of many products are
under • control
by the
of
prices
=100
(May
in
The
211.4
216.7
202.8
203.1
199.6
.
217.6
222.4
231.1
v;
v
138
143
153
132
132
140
140
1940
living there
September last
Statistical
publishes
was
Bureau
of
a
Other
cannot
'
Expenses
fl. 13.875
"V 21.33
1945 Oct.
fl. 19.96
Nov.
18.61
Dec.
18.47
22.09
15.02
25.40
25.825
Total
fl. 33.835
15.42
These figures are
Thev
show
39.94
40.56
;
'
145
for food are indeed de¬
clining. Other expenses are rising.
As wages have risen by 10% since
October, the rise of the total ex¬
penses by more than 20% means
penses
EXPENSES OP A FAMILY OF 4 PERSONS
Food
•
133.;
and shoes.
-
Jan.
305,6
family of four persons:
esting.
1946
Dec.
202.3
that the
Feb
Administration,
Nov.:
monthly
review of the real expenses of a
Amsterdam
1946 Jan.
Price
are
1945-
general index for the whole
161.8.
price-situation. Since the begin¬
ning of this year however there is
more stability in the wage-situa¬
Oct.
country: the average of 6 individ¬
cities
fully usable.
tion in the wage policy, the wagesituation was as chaotic as the
194.7
=100)
ual
these wages
Owing to the lack of coordina¬
1938/39
Wage-index
no
even
202.6
=100)
is
job
($12).
•
(1924/29
<
As to the costs of
good prospects that
public finances.
-'V- *'&?'»!
Members Los Angeles StocTc Exchange
are
30.-
•
(finished
products)
(food)
id.
a year.
the subsidies on foods can be de¬
creased
Com,
million)
non-skilled
a
about f1.
only
The general output however was
still on too low a level to make
,
1938/39
(gen'l. Index)
=100
Id. (raw materials
; 1938/39
it semi-products)100
id.
adult in
an
was
still far above their
pre-war level.
This is shown in
the following table;
Sept.
Wholesale prices
of
.
but
new
dangerous .inflationary
more
Jsyy-i
any
expense
for textiles,
shoes or 'other clothing. The wage
Office
movement may be the result.
...
of which will take less than fl.
million ($40
a
($16), without consideration
for
lowered
be endan¬
gered, and in consequence,
and
in
succeed
If not,, the results of
fl. 40
-40.42
41.245
the
allotted
This is
a
textiles
serious social
problem. The decline of the costs
of food however is a satisfactory
phenomenon and very promising
general outlook of the de¬
velopment of the price-level. This
is especially so if one keeps in
mind that in the coming months
for the
highly inter¬
the
that the
be
ex-
adult workman
average
buy
agricultural
so
abundant
production
that
will
of
export
>'v-' 'J:-'
"pip**
Volume 161;
vegetables and fruit will be
\| essary.
^ ■.
/
v
.
the
Budget and Money Market
The OPA poUcy has up till now
been. to.- control the fixing of
natural
downward
trend
of
pending Wagner - Ellender - Taft
housing bill alone might have
as a been enough for a "normal^ defi¬
result of an increase in the pro¬ cit.
Postponement
of
public
ductivity of labour and capital works is one factor in cutting the
under maintaining the actual level current deficit; but their accumu¬
of wages.
lation adds to next year's dis¬
price
level
can
only
achieved by a greater output
be
bursements, and at rising costs at
that, witnessed by hundreds of
Now, the OPA policy has some¬ recent contractors' bids on munici¬
what changed: it is the intention pal projects averaging 20% to 50%
Relaxing Price Control
of the OPA to let prices be free, above the cities' own estimates.
if possible. The first experiment Also, the outlays for "internation¬
in this direction met with great al finance" as planned for 1946
the
central
bank.
therefore,
need,
There
is
hold
to
mid-April prices of
free, the result
being a
sharp
decline.
Such
measures are to be greeted as the
first steps towards a more free
commerce and to natural equi¬
and
the
(C)
The
securities
taken
are
from non-bank portfolios and paid
for with the war loan accounts;
no
in
this
the
case
shift of deposits
cash from governmental to customers'
balances beyond what was usual
before the war.
Even so, the
accounts
up
compels the banks to put
fresh reserves. They may lose
prospective
deficit
limits
the additional reserves to the Fed if
margin available for further debt the customers pump bonds out of
redemption in the next 14 months the Fed, using their check deposits
to another 8 billions or so.
for payment.
The shrinkage of
excess
reserves
may
drive the
Deposit Deflation?
banks into selling certificates or
The
consequent reduction of borrowing from the
Fed,
bank deposits must be limited ac¬
(D) If the Treasury applies its
cordingly, with no repercussions account
at a bank to finance the
to be expected in the trend of
payment of debt to the same or
commodity prices.
The amounts,
another commercial .bank, ; then
were
the
banking
community
loses
deposits but not reserves; and the
money
reduction
in
Government
security portfolios "and the ac¬
companying withdrawals by the
Treasury of war-loan
deposits
from the member banks caused
a
<
*
($400
million),
but
it
is
very
doubtful whether this aim will be
achieved.
The Dutch industries,
with exception of a few specialized
troubles thrown into the bargain,
revenues might lag far behind ex¬
penditures.) As the price struc¬
ture is being distorted by the un¬
evenly progressing inflation, and
losing income or consumer
category after the other yells for
relief: more subsidies; higher pay,
better parity prices, bigger public
are great,
notwithstanding that
there are; signs that foreign loans works, etc.; will be the- unfailing
The budget has to be
for purely commercial purposes answer.
strained accordingly, and also to
are available.
companies such as Philips Works,
are only on a small scale able to
export; and the difficulties for the
Treasury to obtain foreign loans
one
overcome
Stock Exchange Reopens .«;
<
the obstacles which the
inflation puts in the way of full
The Minister of Finance is will¬ production.
to
part
"
use
tightening
less
by
these operations per se, as rather
by
the
of international trade
A revival
balances with that
same
demand
system,
deposits have
again, and so did excess
then of course, the money market
is
not
assets
affected; since
both
with
most
/
■-
;
>i
-
the
rate
international
of
exchange
The
the liabilities
member institutions
(B)li:
restoration
of
the
in
the
final
Netherlands,
thus paving the way for abolish¬
of
remain
be
1947.
individual
on
But the
current
banKs'
appreciable,
since a relatively small number
of big city institutions will bear
the brunt of
thjs "deflation."
More Gold in Sight
Then, too, the prospiect of rising
gold' imports 'is' Worth considera¬
The
flash
recent
of
per ton
at
of ore, as against Vi ounce
Hollinger's, Canadiah mine of
highest grade ore—is only one, if
spectacular, example. ; In
Canada and Latin America, as in
Transvaal and partly even in this
country, feverish and often sue-'
cessful prospecting is under way;
most
Russia
Australia
and
gone
up
reserves.
announce
(or by
any
Should
more.
in
other than the vaults
of the U. S. Treasury.
erous
un¬
gc|
places to
the
credits abroad,
a
war).
new
cash return from circulation,
a
great deal of
(c)
of
our gen¬
and short¬
and inflated prices at hdihg
ages
Treasury balances from the banks
(b)
or
That, flow
might be delayed, too, by
the horizon—and
loomg.6|
further; growth
yolume.;| |J
bank deposit
our
But in the
gold imports
■
n
'
f"
This is under
to
Jaianii
v-v/''
C-:
■
circumstances to be eoristrctecb8S>M offering of these Bonds for sale, or as an offer
buy, or as a solicitation of an offdh>to;buy, any of such Bonds. The offer is
;
made only 'by mfcans of the Prospectus. '•
"'
J - i
?
'~
no
v
.
$13,000,000
%
•
-fi
-*
t
1
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4
i'A'Y!'1
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V j'lp
'
Central Maine Power
First and General
?
f
}
] V
'/
'
'
''
Company
Mortgage Bonds
Series N 2%% Due 1976
Dated May 1,1946
Due
from May 1,1946'
May 1,1976
••
»*'-•
Copies x>t the Prospectus may be obtained from only such of the undersigned as may legally
offer these Securities in compliance with the securities laws of the respective States.
Harriman
Ripley & Co.
Incorporated;
Lee
Drexel & Co.
Estabrook & Co.
Higginson Corporation
of March and
cut
by $5.9 billions
How far
will
deflation
go?
how
affect
the
/
financial
Hayden, Miller & Co.
The Milwaukee Company
-
The First Cleveland Corporation
Merrill, Turben & Co.
Mullaney^ Ross & Company
(2.1%).
this nominal
And
Tucker, Anthony & Co.
early
April the gross national debt has
been
Hemphill, Noyes & Co.
Graham, Parsons & Co.
them, is being gradually reversed.
course
debt-
does
Stein Bros. & Boyce
Perrin, West & Winslow, Inc.
Townsend, Dabney and Tyson
it
set-up,
fan¬
tastically
rich
fields
in
the
Orange Free State (South Africa)
—allegedly over 60 ounces of gold
expectedly,
Bridges., The nonsensical Morgeri-
the
effect
be
may
thau policy of hoarding unneeded
In
the
before
reversed
end of fiscal
earnings
.,
very
one
Price 102% and accrued i/iterest
especially the banks?
should
As mentioned before, this proc¬
ess has riot a long way to go from
on
confines.
ing foreign exchange restrictions
v.
real
a
the
-..Vf
in the future.
.
cannot
be
moderate, and a
at that; short of
monetary
deflation,'
jt
than
temporary
payment is made by transferring
change restrictions.
confidence
"shrinkage"
deposit
more
long run,
problems are in bank; balances; and paying inter¬
public finance and in foreign exest on the loans which produced
tional
debate
long-run trend that has trebled
net deposits since the 1929 peak
multiplied them by almost
4,000% since 1890.
Briefly, the
meantime (a) the deficit rise un¬
difficult
The return to a sound budget
policy brings a three-fold reward:
it promotes a stable internal position and it enlarges the interna-
started-^
still
check it—bank
and
here
and
as
standards.
not to
or
funds may resume soon again the
Deposits Likely to RiserAgain
Holland are relatively satisfac¬ Treasury's
cash
balances—"like
tory: economic life shows a re¬ drawing on one's savings account
covery; the price and wage situa¬ to meet an overdraft
on the check¬
tion seems to reach an equilibri¬
ing account," to quote .Senator
um on' a level that is in accord¬
ance
get
the authorities
the
touched.
planned
Nominal Debt Liquidation
by the International Trade Organ¬
At any .rate, the possibility of
ization will be heartily welcomed
near-astronomical
by Holland as this, will create the reducing the
debt out. of current budgetary
possibility
of an expansion of
surpluses is rather remote. It is
world trade.
The
economic
conditions
in being reduced by drawing on the
and
expansion
while
roundabout
for
the income of Holland.
savings
deposits
above).
,
;
To be sure, the
caused
was
of
shifting of the prospects of greatly expand¬
(as under B
and C ing production. Of
course, it may
At any rate, the tem¬ take years before even the most
porary "deflation" was of little favorable
prospects are actually
more than speculative
relevance producing in.
quantities; shortage
to the interest rate structure in
of machinery and labor, and high¬
a
highly manipulated monetary er costs in .general, may
delay the
system,
even
though
member
rise of output (unless subsidies,
banks lost 33% of their excess
reserves, which fell - from $1.22 early devaluations or gold sales
to
come
to
$0.82 billions between early on free markets
.; Us
February and April 10, while de¬ aid). But rise it must, thus add-;
(A) If the Treasury pays for posits declined by $2,9 billions, and
maturing certificates held by the their Government bond portfolids ing fuel to the world-wide infla¬
Reserve System by drawing on its
by $3.03 billions (=6%).
Since, tionary trend, and it has few
That is the curse of inflation: it
his financing
a
of our investments in is born out of deficits; once it
American securities and of our grows to .'"maturity" it necessitates
dollar deposits by voluntary liqui¬ more deficits to -correct the in¬
dation. Therefore he allowed the equities - and frictions it i creates;
Amsterdam Stock EJxchange to thus causing in turn more infla¬
The vicious circle can be
reopen on May 10 for trading tion,
In .shares and foreign securities; broken by a ruthless deflationary
but the obstruction against liqui¬ policy only which is mot likely: to
dation is great: the transfer of occur in the next 14 months. In
our
dollar-deposits, mainly the the meantime, the deficit might be
working capital of our overseas mitigated by this or that economy
trade, would deprive the latter of measure of Congress; by invig¬
the means to participate anew in orated
surplus
sales,
and
(as
mentioned
international commerce.
before)
by
auto¬
It would mean reinvestment in matically increasing tax revenues,
Dutch industry,
that has only perhaps even by some new taxes
small chances on the international (?). A balanced budget is possible
for a short while, but beyond that
markets. This
makes capital
Good
much less profitable than it could its chances are pretty low.
be if used in international trade, enough,, under the; circumstances;
if the; deficit is kept in narrow
for centuries the main source of
ing
general tightening of bank reserve
positions,"
the
National
Gity
Bank comments.
credit
tion.
market is not affected.
The
redemption
whether
.
happens if the
same
"redeemed"
market
money
will be tightened.
net
bonds accelerate substantially, and
(d)
the impending
commercial
Fed, then the banks lose
reserves
and 1947 ($2.5 and $1.7 billions,
at stake are too small in compari¬
respectively) are scarcely com¬
mensurate to the foreign emer¬ son to the monetary volume: a
gencies and requests for funds— shrinkage of total Treasury bal¬
ances so far (between Jan. 2 and
$800 millions needed to feed Ger¬
many
and Japan only—to say May 3) of $6.8 billions, which
librium.
nothing of the cost to disperse the cah be barely: more than dupli¬
without
exhausting
the
The lessening of price control is gathering Russian clouds which cated
the
best
measure
against
the might involve vast new expendi¬ Treasury balances available for
this purpose, brings about a neg¬
black market which has dimin¬ tures/
ligible "deflation." The impact of
ished in the sphere of food, but
Inflation and Deficit
their loss on the banks is reduced
remains in textiles, shoes, cigar¬
ettes and luxuries as diamonds
Potentially, the most important by the fact that they hold no
and furs, where prices are far factor affecting the budget is the reserves against those balances;
as to
the Fed, with its virtually
above prewar.
Partly this is a tempo of price increases. Already,
unlimited lending
capacity, the
worldwide
phenomenon, partly they keep the national income on
But even such a
the result of the foreign exchange the dizzy $ 160 billion level, and impact is nil.
nominal deflation
might affect
restrictions #hich prevent im- might raise it further. That means
the
money
market, depending
port and spending abroad. The substantially greater tax revenues
upon the procedure of the debt
prospects
for
the
abolition of than expected, in spite of reduced
and other
circum¬
these restrictions are still far off tax rates, and substantially en¬ liquidation,
as
In an stances, such as the coincident
foreign
exchange
is
very hanced expenditures, too.
tax payments, rise or decline of
scarce.
The Minister of Trade, inflationary race between the two
commercial loans, etc..
Hendrik Vos, plans for 1946 an sides of the budget; the spending
Four procedures may be dis¬
import of fl. 3
billion
($1.2 side wins invariably, the more so,
f
billion), an export of fl. 1 billion the faster prices rise. (With labor tinguished:
success:; in
vegetables
the
to
The answer to the first question
(Continued from page 2639):;
prices; it allows price calculation
The Treasury is
every enlisted man; nor of the is easy enough.
along economic lines, trying to fact that the number of civilian not in the position of a banker
narrow the margins (which is feas¬
employees does not decline in who has to keep & substantial
ible if sales increase) to
urge proportion; to the raise of their liquid reserve against its current
standardization and other meas¬
payrolls, and other unforeseen liabilities, since; it always can
ures to obtain
lowering of prices. items.
What is involved in the borrow-—in ultimate resort from
A
2665
nec-
'by*
the
.
CHRONICLE
THE COMMERCIAL &i FINANCIAL'
Number 4490
May 10,1946.
-
j
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•
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'l
"
Thursday, May 16, 1946
THE COMMERCIAL & FINANCIAL CHRONICLE
2666--
—■*-
•&i.
Continued from first page)
peace
-and
S
treaty has not been made,
no one
would claim that there
is/peace in the world today. Pales¬
tine seethes with the hatreds of
contending
armed
There fis
Egypt and Brit¬
groups.
:
in
unrest
India. 'Chinese
ish
Manchuria,
One
u
Russians
and
other's
each
at
aire
throats
hundred $
in
and
fifty million Europeans and count¬
less
millions
dians
Chinese, and -Irion
the. verge >of
of
stagger
"starvation.
;
ples of the world are looking to
America to; lead them ■ put • of the
confusion
At home, the nation faces sl6w
.
can
rand" despair that sui|The years >ahead
them.
be years
pilots /qsk sal¬
aries up to $16,000 a year for fly¬
portunity,
ing four-motored transport plaites.
trains.
Airline
.
Black
evasion is rampant..
We
and
flourish
markets
.
/"
*
tax
cynicism, ."and.; a
''get as much
as
possible
and .get it now:"
Clearly, this is the psychological
.
low determination to
i
aftermath of .war. It is something
that, cannot „be explained: purely
:
.
economic
in
r
But
terms.
;fouhdly/affectsthecurve txf . busi¬
ness
activity;: and the economic
welfare of the people.
Twa Depression Threats
r
it, there'are two ways
in which this .country/cbuld'ih. the
near future repeat -the sharp de¬
pression that ; came- 18 months
after: the Armistice to World War
^
As I
1:
see
continuance of industrial' war¬
which ftook.: a
in- business failures',
unemployment,
;
industries, • and sharp
inflation. ; Indeed,, under
' conditions,/ * failure
*to
make industrial peace could itself
produce sharp price;inflation,rarid
Long;arid severe depression; has
subsequent/ collapse. / Strikes - re¬ hot/beeri/d b'urdeil borne^ only by
current
:
.
duce the flow of
inqoihe, /but/they
that";, arose
.
toll
farm- and home 'mortgage fore¬
closures,'blasted carpers, idleness,
and want.,
v;
•
,;.v.
■ ;'l
price
.
,
this geriefatibrtof Amerii^nsiThe
American businesses.:It is the most
should
workers
be
damage the- health,
.
permitted to
welfare and
jsafety of the nation.- No group
J should ever/be able to place the
>
entire
;
American
jeopardy.
to.
economy
great
in
A stop must be put
the' recklessness
private
with
which
organizations
are
using their immense powers. Haviing endowed labor unions with
could
aging than thosO Of earlier days.
The depression b£; 1920-21 brought
a 25% reduction* in physical vol¬
swings in business activity has in¬
creased, as.our'economy has*be¬
unparalleled, power, the nation' come richer, and a growing frac¬
must place Upon~ them commen? tion of production jhas consisted of
Curate; responsibilities.- Afree so-*- durable goods, the demand for
be
damage
severe
struction of our, economic
litical' institutibri's"" arid
erties." 4"
of
production; that of 1929-32
brought a 50 % reduction; that of
1937-38 brought a 25%
decline.
There*1s much evidence'to. support
the
Hew^ that Hhe -violence of
ume
"
,
-
Business
It
is my
icies
can
.'
•
\
\
/
I
I.
belief that public pplri.
be' devised for
prevlenf-
ing extreme fluctuations in /busi¬
activity, and for maintaining
production -arid;>/ employriienf: 4t
reasonably high and expanding
Jfeyels, within the frariiewprk 'of ja
free-market,
competitive
eccjriomic system, I propose brief
jy to
outline the nature of som^ {of
ness
those
?policies,; particularly those
the"
in
monetary
;
and
v
fiscal
"spheres. They fall, it seems tc^ me,
into two general categories, sep¬
arable for purposes of discussion
but Closely conriected. ;w^h jac)i
other in actuality: First, ecor\< >mfc
policies; for the postwar frans tiori
period; Second, economic policies
for the long run.
f'
iv
.
a
III. Economic Policies fori
Transition Period
The great;'^
the postwar
%
■
INVESTMENT BANKERS
•;
UNDERWRITERS AND DISTRIBUTORS OF
INVESTMENT SECURITIES
,
:
BROKERS OF BONDS, STOCKS, COMMODITIES
Private Wires
•
Home Office: Atlanta
©
,
;;
.
'
Phone LD-159
rising too rapidly will be a lead¬
ing economic problem for a num¬
ber of years. This.is a direct; and
•perhaps inevitable, cons6quente of
World .War. H and thp way in
which it .was Ifinanced. Between
1939
and
pUrchasmg;nPOW®r
matches
come
tripled,
the
national (in¬
doubled, and very large de¬
Jess
a cop-
/)
Pa:Trend
the; /rise I-that /occurred
of
Commodity, Prices
able to avoid 'an*increase in comri/
within a. year .after ^h'e^rm istiee
hfadity prices of
more.
than ,10d(%
Noveinber; l$l 8; Since 1939-th^ as/a .result Jpf a major • War^Frices/
all-commodity index>of)wholesale ^oubjed/duririg:^?^iriririediatqlyj
pr Ices^of XheJBUrCaU/rif;Labof S
fdfteri;thrilReV;olritioriary/Wari;f
rtisticsivhas^ risen; about 40%".* Irir War bf/18l3rtthe; Civil 'Wa^anff;
dustrial common stock prices have
WriridZ/Wa t-vI/;The/cause?ri£/these/
risen' u60% ./Farm,and urban/real doubled price levels was jn each
estate prices/in^Many centers have case, the" same-^-a/vas|Increase /in'
of
.
doubled'. The cost of living index
spending •by:the::Federal ;Govem-»1
tnent financed in large part by in¬
•is; up/33%/ but no one takes thii
index ,too seriously -today, in yie.W
of the marked; deterioratibn
in
"
.
creases
ing World War II has been fully
great
as
in the preceding
major wars. How^theqi, can the
as
nation/prevent further price in*
flatipn?//-':'"t
'
Inflation} Antidote
Production/Not
It is widely held/ that price in¬
;
flation can be smothered/in ab
avalanche
of p production. ; The
NAM holds to-this view.
Mr.
get,it
all-out
Bowles said recently: "Let's
unmistakably
clear
:
that
prOductipri/is ^ the /orily^:/(sjcy riri*
substantially, and by much
than is generally recognized,
more
Federal spending
and in the quantity'of money dur¬
The cold- fact that prices; have
risen
in the quantity of money.
The" increase in
i"
Future. Price Prospects
swer
Mr. Bowles -is
All-out productionns: cer/
to inflation."
wrong.
leads one, to ask
whether further faihly/ri/goodrihingf/but/itds riot
the level/df the only answer to inflation, and
prices/are/in? prospect. Without it may even not tbe a: partial an^
making any prediction, it-cam ,be swieri to it. When production^ eit-4
said that; if: the amount > of money
parids, so do payments of wages
now in the hands of, the public and
salaries and dividends and
large
increases
in
circulated with the
were
as
same ve¬
obtained, /prior
to
profits;/ The
the
act of produc¬
purchasing power
very
tion creates the
< Expanded;
to f buy,its / product.
an'> expanded
flow of ciirrent fticortie, and cur-
production
means
-Let-me-repeat -this; If, the public
should return to the same habits
rently-received dollars -are
of using money
iri^ power
that it followed in
T940/.and ;if /physical volume /6|
production
rises" to' something
near
capacity figures, a further
rise/of 50 to 60%, in the wholesale
■prices would occur. Fortunately,
shortages of goods of good quality,
and uncertainty about the future,
so far have kept a large part of
the /increased/supply of cash/and
bank deposits comparatively idle.
Money has had, an abnormally, low
idle
dollars ; lying
-
spencl^/
in- ^pockets,
Safety deposit boxes,, and
banks.
It; is quite possible that" the ap¬
pearance
of larger supplies of
•better, goods on shelves1 may re?
assure consumers that their .wants /
•will .everitually? be satisfied j /and
will make1 them; willing, to forego
a
little .longer the spending of
their savings arid :their- current
incomes. * But we cannot ;be sur^
velpcity of circulation.; Our hppe
of
for reasonably stable prices in the
that
future/lies In. reducing the quan¬
duction* may also lead
be freer " in - spending
The
this.
incomes
expanded
accompany ^
expanded; pro^
,
people^to
their;- sayhand^,
apd Ipreventing its; velocity pf u^e ings,.so/that:the(result of;.all-opt
/ /.
production/would-be-an increased;
.The rise in cost-of living .th^t velocity of circulation of mon^y
tity of moriev;in the public's
^from rising, /.
has
.
^
already occurred, Quite; apalt arid more
/is /in - prospect; •pricey
upward : pressure-. ori/
from ;that; which,
has
serious
had
-'
social
conse¬
-
I
'p.
Price ,Contr,oi; Ignores
.:'/! *
,r
~ ~
Fundamentals
-
,
'
-
Expects Tnereased GI. Benefits;;
Another- current ^notion lis - that
regulation of prices by OP A- can
a vast inarticulate bodyI be¬
peooie/whose, dollar incomes do prevent further inflation.
lieve that: OPA controls can re-?
not, rise quickly; if ..a,t all,: /with
-
There- is
of
higher prices. Inflation: is'/taxing
away the substance of their,:exis¬
tence;,' They include millions.; of
old-age pensioners and annuitants;
teachers, professors, white-collar
workers, and last—but -far from
least—war veterans whose bene¬
fits
under " the
G. I. Bill /will
the quantity of. shrink
cash- and demand" deposits in the
nearly
more >or
steadily far 3Q yerirs/TWith
can be "prevented." We are riowlook Uack" over the
orie year/pasf V-E day; The fact is history;of
hited: Stated dtiri?
tha| ^there^jhas fieen^^ a^^ siibStaritlajL ^rig
W® fiPji/
ris# dn /prfces ;that/i f ust / abodt tnat/th^:^atipn/nas^^nof/yet/bcphl
1945,
hands of consumers and businesses
ship."/ L/thi rik 6f the creeping.1
iriflation/iri
quences.
economic/problemsof
transition; is not! uii-
political ferment/that
.
it
j
employment,
as
many' people
thought sa year ago; but commod¬
ity price inflation; The probribip
ities are that keeping prices from
vi^
Members New .York Stock Exchange and
Other Leading Exchanges
:
the
of
directly to Hitler -and dicta- ■'
"Sequerit fWCakrie$^ • of /the suriai'
war,/ it .would support a further
large increase in wholesale prices,
f
where. price
j-inflation ^iri/:France;,: "vwhilre I the/
French fraric has;l3een falling ,rin
the/f uturq, 4?erisei^^ arid/ask; Whether;
i lib¬ locity
our
Can Aid
How Government
;
or de¬
arid? po¬
.
'sxy %/vr iaj|,
do not have
in,,'mind: cases -of 'explosive inflari
tion, such as 'that of Germany
important sihgie hurdle-to the re¬ quality, curtailment of service,
building (bf -free,
'cornpetitiye ?and absence from, the stores of
markets for world .trade; For trie many .low-priced lines, of mer¬
sake of our own prosperity, and chandise that figure heavily in the
for rthe'sake jot building the kirid cost of living index. We know that
of a peaceful world :that Ameri¬ Ariiericans /spent /twice as much
cans want * to live in, we must in money for food in 1945 as they
the future avoid a t "boom .* arid spent in 1939, but received very
little more food per'capita/ which;
bust'- - ;ecpnpmy. in
the.? United
States. ES;Ut we must/.prevent ,^se-r suggests/that: food priced have;just
abouttHey/
vere depressions for still another
measured properly.
reason. The 'American people - will
also augment shortages-of goods, United States-- has had prolonged
They lead people who stilphave periods of: failureito utilize tefull
Incomes and savings to (despair i<>f pritentiabof manpower
ahd/physi-«
satisfying their wants at reason¬ cal-resources: iri (the 1870s/ .in; the
able prices, and to throw their 1890s,
/ and immediately prior, ijo not again tolerate prolonged urimoney into, the markets in a wild WorldWar 1. 'History seems <to-in¬
employment on; a- ;large.: scalfe.
scramble for; goods. ; / J
:
dicate that aperiodic' depression j&
Should it emerge, they will insist
My- task today is todeal with a chronic and not an acute disease upon prompt action by the na¬
of our -industrialized economy.:,
the: problem of price :and employ¬
] tional government. If 'well-con¬
ment stability.; I do not propose
sidered arid accebtabre'policies for
^Previous Depressions
a specific solution to the current
coping with depression have nbt
True, the depressions of the past
labor difficulties, for I have not
then been devised, ill-corisiddreicl
appraised the issues. Yet certain 251 years, -which are within the policies will be put izito effect.
principles are clear. No organiza¬ memories of most of us, appear to Theend-resuRsof^^to
have been sharper and more dam¬
tion
of businesses,** farmers,
or
„
to
,
cratic government. ,1 -
tor
consequences.
;still talk about;
variable dollar incomes as
weaken the fabric of demo¬
led
Sight; Would: have graVe: social
We
those
and
dollar-incomes
fixed
with
centre
inflation of the magnitude that is
in:
income and wealth so in¬
equitably as- between those with
utes
ing influence of thq middle class,
and permitted • it/to;bceoriie/Rie|
.
war.the. Ameri¬ naiioha
3share'dhese uncertainti^
can economy has demohstfated its
The principal reason why ' Britain
great capacity to produce and to has hesitated to re-establish free
expand, But it has not. yet demori-.
trading;relatiQnships ^viUj^-tbp/reSt
strated/a capacity tomaintain pro¬ pf:ibe^drld;cas^^sheisffequired/to
duction and employment at high
do under the. Bretton Woods and
and expanding - levels/ For -the
British, loan agreements, is her.
span of our . national economic his¬ fear .that;
another, depression"! in
tory in which there are .good the United
;StatesZwill/af^ter;a/fe|y;
measurements, .the record shows
years, Esoxediicei markets" fptiher'
that there have .been five,, ten, and
:produrits,ahd dhose^of/other; t^aq^
even
fifteen-year periods when
inglnatioris/jas to seriously unJobs werepbundant and goods and stabilize the entire world/
f;
services wpre produced; at- some/
Fear of ^economic instability tjs
thing near- capacity deyels.
But
the - greatest single", /obstacle ; to.
these periods of growth and pros¬
long-range planning for expanded
perity rwere' . periodically winterr
production
and - investment
by
riipted-by isevereJjdepre^^phm^d
I wish' to /make
.
demands
ought' to 'be shared .by 'everybody^
Revere/ price iriflation /redistrib-;;
ii^latiqn/Uestroyed^ ?the :■:,§tabil^-;
several, points
about prices .that are being .gen¬
World Living in Fear
erally" overlooked in current dis¬
.„Naw/;a's .we are rpassing through
cussion. First, there has already
the ihmes oofijecoriomic;:^transition
occurred price inflation of serious
following World War II, mariy
Americans are haunted by the fe^r pr(mQttionsr;S0cond;vtrie: danger jbf
further large; increases; iri prices* is
dhat/after: a .few years of "higtir.
;level production to catch-up with great and immediate. Third; price
during the' war'years,'dherq, willbe another period of prolonged
and severe "unemployment; Other
veterans' /benefits 'to;
after 'World? War J,
Price Inflation Already Serious
'■
-
In peace, and in
heavy
fare in key
be, placed in this
beginning:iri;1938,
unsatisfied
Sustained
Prosperity
are
disillusionment,
It may come but once.
II. The Problem of
•.
reaping . the grim and
inevitable harvest- of war----unrest,
of domestic prosper¬
ity and world leadership for the
United / States, /if ; we /keep " biir
economy strong and productive.
Let' lis mot throw away this op¬
for munitions'to
Country
of
amount
home and abroad,, for, almost every, compensate ifqr (higher rprices. ^ r
kind of durable goods. Indeed, the
But concern for price inflation
demands ;for :manyi non-durablq
ciety cannot endure on any other *which is postponable. It is a $oibering fact that,,/during the inbst goods, such, as food, .clothing, tex¬
tiles and services are above'those
recent depression of ,1937-38, /the
Prpvp
that our .economic machine can
Mu&l Promote Common Welfare
drop in business activity per unit
of tipiei was sharper ?and faster satisfy at current price levels. The
v Apart from applying these fun¬
result
is that,,prices are being.
damental principles, all groups in ;than: ever before,; and that the
have
gone pulled strongly upward by; ex^
our
economy
need to recapture downswing; might
panded money demand. Concur¬
the spirit of cooperation and. con¬ much iurther ?had mot .the re¬
rently, they ar.e being pushed up
sideration for the common wel¬ armament of .Europe to meet the
threat; of Hitler caused vast orders by rising wage arid material costs,
fare that once existed. Other peo¬
rourids
v///:/' /
paralysis for lack of coal.Rail¬
road' workers threaten .to stop the
.
developed; both at
ferred demands
How Can We Avoid "Boom and Bust" Economy ?
power
ues.>I
a
steadily / in; purchasing
price inflation contiriwill not be surprised to see
as
large upward adjustment
in the!
%
tard :the/ inf latioriary.» process; ,'ancf
/;
should/.be} (kept./ on: some/ goods, ;
arid -servicesfor ./-a/ -limited tirrje. /
Bqt ? OPA combats the: symptom
rather than the cause of price inRation, and "is becoming
fective every day. OPA
asked to
den
carry a
Direct
an
Aari
;
:
far heavier bur«»
of//responsibility
for ;price
^
should bear.
price controlJs being used
stability /
as
v
,
Tess ef¬
is beipg
excuse
it
for evading the re-
p
r*-
'■'•€•'«
"Number 4490
yoluhie ,163
'vfl-
1"/.v#;.'i
.
A' V.'i*r >'; k TT.i
'?'
v
V'
*'.in
11
-i
H"'
-
THE COMMERCIAL & FINANCIAL CHRONICLE
V. •' *Vv.
sponsibiUty of following non-in¬
flationary monetary fiscal and
wage
policies. > A Government
which permits politically power¬
ful labor and agricultural groups
to iraise the prices of their serv¬
ices, while it holds down the
closely-related prices of the goods
and services of other economic
that
the
rehabilitation
plant i low four milliorir^and the United
of
rebuilding of inventories
and consumer receivables will not
frill potential capacity In produc¬
tion and living standards. History
only require all of the,excess(cash
of business, but will require large
amounts of credit from banks and
teaches us, however,
ftot
that
,♦
V*"'
•
•
■
'•'/
'•>*
£ 1
•>■
because
coordination
lack1 of
the
in
effects
cancel
For
out.
j
ex¬
Higner ate at .capacity with' reasonably ample, during the latter part of
money
rates
would thereiore stable prices for an indefinite 1936 the Federal Reserve authori¬
curb fhe borrowings of businesses, time. Deliberate fiscal and mone-; ties were trying to clamp down on
.business and - consumer credit in
•*
"groups, is not being honest.
The State rind local governments, and tary actionsi'! will be needed.^*s'J% !f
} v-.r^
'
i. '„
iv
1
order to reduce public spending,
first step in any real program to consumers, and would tend to re'?
Fiscal Factors to Support
while at the same time Congress
prevent further price inflation is duce upward pressure on prices.
Prosperity
chose to pay out one and one-half
an
It is pointed out that in 1921,
unswerving policy of forbid¬
I
other sources in addition*
,
■>'
ding ;
any
wage
increases
with
price-inflationary" consequences.
Must
{
Restrict Money
Supply
But the present situation. calls
more than simple jhon-
for much
esty in the administration of wage
and price control.
It calls for a
strongly .deflationarymonetary
and fiscal
policy, which aims to
reduce the quantity of money in
circulation
and
to
prevent its
velocity of use from rising. The
two
of
methods
basic
accom¬
after the end of World War I, gov¬
sold down in
the 80s to yield 5.67%, but this
ernment
securities
k
v
submit
elements in
that
a
there
are
three
billions
fiscal policy to sup¬
ures
will be considered painful in
quarters, but it is high time
that we stopped shadow-boxing
with the problem.
some
of further price in¬
Prevention
flation
merit^ for the time being, of plans
for
large new public works and
expanded Government services,
and a rigorous pruning of Federal
expenditures all along the line.
Desirable as many of these ex¬
penditures may be, they are out
of step
with the needs of the
times.
:
"
Interest Rate Increase Essential
'A rise in interest rates is alsio a
necessary part
flationary
of
a
program,
real, anti-in¬
along with
<5ther measures to enable the Fed¬
eral Reserve authorities to recap¬
they
of war finance.
years
banks
cial
holdings
ities
of the money
lost
during five
control
the
ture
markets
Commer¬
have such large
Government secur¬
the# can get cash to
now
of
that
replenish their reserves almost
without limit, by seUing Govern¬
ment bonds to the Federal Re¬
serve banks.
So long as the Fed¬
eral Reserve banks continue to
buy Government securities at such
times and in such quantities as
will
Treasury
normally
policy is
an
Higher
a
variety of reasons.
It is
often said that the Federal budg¬
et will not stand the strain of a
for
maintaining high and expanding
production and employment by
accident or by a stroke of for¬
In
tune.
policies
nave
a
as
very,
democracy, long run
important ;fas those I
briefly outlined will
pot be put;into effect until there
is an influential body of public
/,
•
opinion
ing
behind
and
inflation
price
to May, 1920,
oollapso,ohd de^
up
ahd o^ubsequerl;
are
the achievements of industrial
sales are
individuals. Necessitous
hot
that
probable today. It is likely
market; depreciation of gov¬
resulting
higher money rates, would
many
holders, to refrain
cashing them till maturity,
ernment
from
bonds
today,
,
spell in which to work out
gain popular acceptance of
designed to stabilize our
economic
tunity
growth.
comes,
most of it!
—tmmmtm
Sank for
Savings
At Mien Hollar
The
are found in tariffs, cartels,
exchange restrictions; and tax¬
ation policies designed to encour¬
age rish-takmg and a large vol¬
or
of private investment. With¬
out these measures, a
flexible and
fiscal and monetary
been
in
outspoken
rates.
Life
not
are
insurance
compelled
to
companies
dispose
of
government bonds before matur¬
high-level employment threatens System, the Public Works Admin¬
to become a boom accompanied
istration, the Public Loan Ad¬
by price inflation. A deficit in the ministrator, and:
(Other: Fed¬
Federal budget may be generated eral agency that has£to do with
by either a reduction in taxes or
thriinflowriridriUtflowrif Federal
an
increase in spending; a sur¬
funds must ,be harmonized with
plus may be created by either an
increase in tax collections or a the changing needs of a smoothly
commercial bonds. The
average maturity pf commercial
bank
holdings
of government
borids is now only abput four, reduction in expenditures.
years. A further increase In bank
Deficit-Financing Defects
deposits is more probable than a
During the 1930s we made some
decline. Hence banks generally
can let their holdings pf govern¬ attempts to get flexibility, on the
ity,
nor are
Budget Surplus and Tight Money
to Combat Inflation
A
budgetary surplus and a
higher interest cost on a $280 bil¬ tighter money market, are essen¬
lion dollar debt.
The answer to tial
weapons for combating price
this argument is simply that the
inflation, and their use is entirely
Federal budget can much' less feasible.
Moreover, because their
stand the strain of the larger ap¬
operation is broad and 'indirect,
propriations that will be neces¬ they are eminently desirable in a
sary for
the military establish¬ free-marhet economy. Strong fis¬
ment, veterans and agricultural cal and monetary, action to .reduce
aids, public works, and regular spending will take the strain off
departments, if further price in¬ direct price, control. Those who
flation occurs! Even a 50% rise tolerate a continuance in infla¬
in the .present J$5 billion annual
tionary monetary and fiscal pol¬
interest : on
the national
debt icies are
postponing the .day when
would add less to a $25 billion
direct price control may safely be
Federal budget than a 10% rise removed. Those who wish to speed
iri the cost of goods and services the removal of direct control
purchased by the Federal Gov¬ should insist aippn the vigorous
expanding
The politi¬
economy.
cal difficulties of achieving such
coordination
are
formidable; but
they are no more intractable than
This advertisement is not, and is tinder no
securities for. sale
or as a
The
new
Cotton Margin Increases
Decried by Sen. Thomas
Senator
Elmer
tori
future trading as a system un¬
of trad¬
ers can "push prices up or down
at will," the Associated Press re¬
ported
from
Washington.; The
der which a small group
declared
Senator
issued
that
Economic
by
trading
Trade
•
on
to
Sees Need for More Credit
Another
contention
is
that
the
Board
of Trade
higher interest rates and a tighter
money
market would not mod¬
erate price inflation today, be¬
cause businesses and other bor¬
rowers are so liquid they do not
are
maintain an "open account,"
trading without margin. "It plays
to
into
the "hands
those
of
I
long
as
,
circumstances to be construed,
as, tin
offer of these
offer is made only by the Prospectus.
-
.
Company
Due
May 1, 1946
May 1, 1976
price in¬
1
■*
"V*
1
*
■
I
\
%
*
/
J
x
]
'
C
.
1
?
-
1
i
s,
f
Copies .of the Prospectus
Policies for the Long
Underwriters named in the Prospectus as may lawfully offer these securities in such State,
Bun
may
be obtained in
any
State from only such of the several
Assuming safe passage through
disagree. ' Assuming ex¬
like that of 1919 to 1921, a num¬
pansion of production to a high
level of employment, and assum¬
ber
ing that prices increases already
unemployment
in prospect
within moderate limits—say, be¬
-s
IV. Fiscal and Monetary
the transition period, without a
sharp price inflation and collapse,
materialize, I estimate
v
of years
then
follow.
V-r.'
:r0:;'x
Kuhn, Loeb & Co.
of prosperity should
During
these years
should
be
kept
May 10,1946.
do
price up or down at will. It is not
stabilizing influence."
a
:OFFERINO PRICE100y2% AND ACCRUED INTEREST
f
who
pot have to put up any money,"
Thomas said. "They can push the
us.
spend
need to borrow in order to
more.
measures so
flation threatens
of
allowed
members
of restrictive fiscal and mone¬
tary
Stabilizer
the Chicago Board of
have
dropped - from
25,000 and he
about 90,000 bales to
added rthat certain
,
use
order
the
Chester Bowles had caused daily
2%% Debentures
v
ernment.
(D.-
Thomas
Okla,) criticized the Government's
order for margip increases in cot-
solicitation of an offer to buy any of wok securities*
United States Rubber
.
_
issue'
Dated
the
in
public over the counter," Mr. DeCoursey Fales, President of the
Bank said, "the results indicate
an active interest by the public in
this type of protection".
.
have
Savings
life insurance is sold to the
this
.
tives
for
Bank
City of New York announces that
it has reached the million dollar
exemptions as tools to build eco¬
mark in Life Insurance policies
stability/ Before the war;
issued. The Bank entered the sav¬
personal income taxes-' affected
comparatively
so
few families ings bank life insurance businss
on April 17, 1944.
During its first
that they were a weapon of small
calibre for dealing with unstable year it wrote $363,500 of insur¬
markets. Now, under the impact of ance, with nearly twice as much
written in the second year recent¬
war, we have developed a system
It is estimated that
of personal income taxation that ly completed.
the Bank will write another mil¬
iri 1944 extracted $17 billion from
lion in the year ahead, doubling
the pockets of more than 40 mil¬
lion
individuals
and
families. the business now on its book, "As
policy to supoprt high employ¬
ment will result only in a chronic These heavy and widespread in¬
tractive investments for individ¬ Federal deficit and an eridlessly come taxes provide us with a
powerful weapon for dealing with
uals; This would prevent further rising public debt,
booms and depressions. By cut¬
stock market profits, which make
Endorses "Compensatory Fiscal
stockholders feel more prosperous
ting exemptions and raising tax
Policy"
1
rates during a boom, we can re¬
and spend more freely out of their
If we act vigorously) in other duce spending. By raising exemp¬
current incomes.
spheres of .economic ^policy, then tions and reducing tax rates,
Higher Rates Will Not Endanger I; accept -the principle of "com? spending power can be put back
Bond Portfolios
pensatory fiscal policy." In brief, into peoples' pockets, when busi¬
Still
another
argument
ad¬ this principle calls for balancing ness activity declines below a
vanced by those who desire to the Federal budget at a satisfac¬ satisfactory level.
perpetuate low money rates is that tory level of employment and pro¬
Along with planned flexibility
the solyericy^pf financial institu¬ duction. It cputempiates govern¬ in both the revenue and the^exment support of markets for busi¬
tions might be jeopardized by
penditure sides of ; the Federal
market depreciation of their Fed¬ ness'through a deficit of tax rev¬ budget, we need far better coor¬
eral bond portfolios. That this is a enues under public expenditure in dination of fiscal and monetary
times of under-employment.
It policies -than now exists.
pure bogey is best demonstrated
The
by the fact that many leading requires a surplus of tax revenues major decisions of the Treasury
bankers and life insurance execu¬ over government spending when
Department, the Federal Reserve
their demand for higher interest
If this oppor¬
us
make the
let
nomic
they
coordinated
•
lark for Life Policies
Role of Taxation
j We have not yet attempted to
use flexible income tax rates and
groups; the demolition *of barriers
to trade between nations, whether
ume
next
mistakes.
these
peace
ding" practices, whether imposed
by business, labor, or agricultural
The
them.
measures
,
their price from
effort to help the
borrow money at ab^
ment bonds run to maturity, and
low rates, a tight money
would not be damaged by market
impossible.
depreciation in. the interim;
money rates are resisted
prevent
falling, in
We .shall not achieve our goal of
few years may give us a breath¬
'S.\K- .J-.',
"
'
'
cause
not
bonus to the soldiers
^
,
merely a
from
balancing of the Federal budget,
and would reduce the volume of
but the prompt development of a
money
rates
substantial surplus.
Let us can¬ spending. Higher
would also have the effect of mod¬
didly face the implications of
this policy. They include a con¬ erating further increases in prices
of common stocks by making Fed¬
tinuance of : present taxes as a
eral securities relatively more at¬
minimum.
They mean abandonrequires
I,:'*
port sustained prosperity; first,
Another grave defect of deficitflexible taxation; second, flexible
Spending' during the 1930s was
high y.eld did not dete.r investors
spending; third, coordinated ' ex¬ lack of advance planning of pub¬
from cashing .their bonds. There¬
ecution of the fiscal -operations of lic
expenditures. A great deal of
fore, it is argued, higher interest
the Federal 'Government. '
money was spent on projects of
rates, now would .not Induce the,
Before I spell out the meaning dubious -value, which created un¬
public to invest in government
securities,
or
discourage them of these factors, I wish to make it certainty in the minds of private
clear that I .-do not regard wise investors, and tended to nullify
from
cashing ?their bojnds and
employment-generating ef¬
spending the proceeds. In my view monetary and fiscal policies as the. the
to .sustained fects of the Government outlays.
tee present situation is hot par-; onlyprerequisites
prosperity. Of great importance Iri the future; we must avoid
allel with that in 1921. Very sharp:
between labor '^unions arid
ate a substantial surplus in the pression, brought about many ne¬ management; the elimination of
Federal budget,
sales
of
government all kinds of production-limiting;
and to tighten cessitous
and "feather-bed¬
the money markets. These meas¬ bonds by Illiquid businesses and price-raising,
plishing these results are to cre¬
as a
of World War I!
I
war,
Opportunity Now at Hand
;
fiscal actions of
different' Federal agencies made
expect our economy to oper-, the
problems of winning
harnessing the atom.
of
or
the monetary and
we can-
a
-
spending side of the budget. They
were none
too successful, partly
States should be able to realize its
and the
2667
.
THE COMMERCIAL & FINANCIAL CHRONICLE
2668
"What Is
greet with inattention
(Continued from page 2641)
field
«-i.x^i^etnng
truly liberal in that field.
are
of
una
fc.v,-<^i.ce
I
Liberal
Everyone Calls Himself a
government
social thinking, tne term is
But in the field of
and
loosely used and
its
meaning.
agrees on
none
Everyone goes
around calling himself a liberal.
When he speaks of others as lib¬
eral he means little except that
the so-called liberals agree with
himself.
Others who call them¬
selves liberal simply mean that
resent¬
or
attempt to modify it to
individual freedom. ■;
ment any
protect
realize
that
there
are
many
against a Government pro¬
gram.
Some of them are liberal.
Others speak with the same vio¬
prejudice as
propagandists.
intolerant
Government
the
the
general attitude of the
working
press,: the
columnists,
radio commentators. is
But
the
and
which gives too little consid¬
eration to freedom of thought, or
one
the effect of specific proposals on
in favor of change, or
freedom of thought or individual
particular pet scheme for
change, and imply that everyone independence.
who
happens
to
oppose
that
Communists and CIO
change must be ruled out as a
An
extreme
example of soliberal. As a matter of fact, a man
called liberals whose liberalism is
who is always in favor of change
is a radical.
A man who always completely false is. that of the
Communists and ? the Communist
prefers existing institutions is a
Obviously,
Communists
conservative, but either of them press.
cannot be liberal, because they
may be liberal or the reverse.
advocate a form of government
We have become so confused
in
which a few dominate the
in our thinking today that no one
many.
Furthermore, their own
knows
whether
the
American
philosophy of a party line to be
people themselves are liberal. The followed
faithfully
by
every
real question I would like to raise
member of the party is a denial
is whether we can longer make
of freedom of thought.
good our boast of many years that
We can join in this classifica¬
we are a liberal people setting a
tion the national CIO organiza¬
liberal example to the World.- As
tion in New York City* which
I see it, a liberal is a man who
seems to have become a fellowbelieves in freedom of thought,
traveler group.
It is hard to find
Who is not a worshipper of ortho¬
any justification for their attack
dox dogma and is willing to give
on
the appointment of Herbert
attentive
consideration
to
new
Hoover as Food Investigator, or
proposals whether he finally fatheir picketing of the Churchill
rVOJ?s them or not, a man who bemeeting, except that their first
lieyes above all in freedom of
interest is in .Russia. This, I may
thought for others as well as for
say, is not true of CIO Councils
himself. But it seems to me there
is one essential belief which he throughout the country, nor of
must have if he is truly to be many CIO unions.
they
parently have not even discussed
the subject, or at least have only
test
and
are
vVsr" '-v.
dists for that
policy among their
| members. On the orders of the
| national officers, telegrams pour
iri from local groiips which ap¬
who still raise their voices in pro¬
lent
goals can and must
with them. • f,
:
Liberal?"
a
heard
side.
one
intolerant
which
of
They are utterly
point of view
any
criticizes
the
'
classified
as
He must
liberal.
a
in freedom and freedom
believe
of thought,
for if any new pro¬
posals made under the name of
liberalism are such as to destroy
that freedom, the whole basis for
his
philosophy
must
collapse.
Therefore he cannot be a liberal
he opposes proposals of
unless
Therefore support of
that nature.
proposed is not a
liberalism, but of radical¬
change
every
test of
ism.
cates
who
anyone
advo¬
dictat¬
totalitarian State,
a
ing the dadv life of all its citizens,
cannot call himself a liberal. ' My
t6X many of the selfconfessed liberals of today is that
objection
they
,
advocating
constantly;
are
measures
to reduce freedom and
particularly
individual
of the
freedom
the
fr
and
e
ed
of
om
thought.
Defines
Liberal
a
Thb definition I propose, there¬
fore, is that to be a liberal a man
believe
first,
must,
measures
oppose
'
in freedom
which re-
~ict it unless such restriction is
*
solutely necessary to preserve
freedom of others. Second, be¬
ll eve.. in
But I think it is seriously open
question whether the Ameri-
people realize'today what It
to be liberal, When self-styled
if'm
1 'serais
,
c;
:j
advocate
measures
seri-
sly reducing the freedom of the
^qple or freedom of thought, no
to notice that necessary
resent it as- It would
one seems
result
or
have been deeply resented during
the first 130 years of the Repub¬
lic.
Particularly, a-v policy an¬
nounced
by
the ; Government
.
to
seems
have
a
presumption
in
its favor if it aims to accomnlish
a
popular result, without analysis
ot its effect
eration
of
achieve
on
or
question
a more
change
consid¬
whether
liberal way to
result.
that
advocate
freedom
the
there is not
are
Those
who
utterly
in¬
tolerant of everyone who opposes
their ideas.
called
A
liberal
orthodox
made
on
other fields: "Give us un¬
limited
power- and
money, and
leave the solution of the problem
to us."
Of course, it isn't even
many
certain that they will do any bet¬
in
ter
-
erals, but don't stop to think what
that term
fields
In other
black market violations.
really
means.
Situation Alarming
The
situation
to
mind
is
name
my
of
alarming, because in the
progress
losing
are
we
all
that
unconsciously
intense
liberty which made
love
of
republi¬
our
form of government a*force
can
for progress throughout
The dynamic thinking
the world.
today
is
has
Government
the
affected
is
and
the
trend
When
Labor
Relations
Board.
justice fails, it means that
has
man
some
his
lost
Racial discrimination
is
freedom.
a
serious
problem but for the welfare above
all of the minority groups
it must
principles of
justice and liberty primarily by
education and persuasion of all
be solved within
the
our
people,
and the
employers, workers,
public. .Force is not the
Certainly,
we should not
limiting the free¬
every employer in
the
United States until every possible
adopt
a measure
dom
of
alternative has been tried.
Opposes Conscription
,
the pressure of inflation and black
market increases to the breaking
State,
occurred under the first
as
National
Regardless of its wisdom, there
caught in the squeeze which is
can be no more serious limitation
completely unjust to them, and
of freedom than the action of a
for which there is no remedy in
Government in conscripting young
the courts. Production of the goods
unconsciously
totalitarian
such
Act, and
that there never were
outrageous
perversions of
say
justice
Many manufacturers and distribu¬
tors
in
certain
industries
are
done by those who
consciously or
lean v towards the
can
answer.
held
but has encouraged
increases in wages and other costs
on the theory that this could be
done without increasing prices.
firm,
prices
I
promptly falls off, and
from their homes and schools
men
and their occupations, and
forcing
Navy to
serve as ordered by some superior
officer.
We recognize the neces¬
sity of such conscription in time
them
into the Army
or
strong
from liberalism
those who, in theory,
all-powerful
govern¬
away
even among
denounce
.
,
•
X ;*
National Labor Relations
Government bu¬
OPA is like that in
point Butter, cheese, evaporated
milk, housing lumber, white shirts
are only examples. I believe price
We have never hereto¬
ment.
The result is that liberal control should be continued, but of war.
fore recognized it in time of peace*
thought is fighting for its life in* on terms Which will assure justice
stead of providing the aggressive how and decontrol as soon as pos¬ Today, public opinion is at least
equally
divided.
Because
high
•
philosophy which alone can resist sible.
Army Generals say that we need
the juggernaut of world totali¬
the draft to provide the armed
Hits Compulsory Health Elan
tarian thought.
The President has proposed a forces required under present con¬
We have before us in Congress
ditions, most citizens assume that
many measures which perhaps il¬ compulsory Federal health insur¬
They -seem to
lustrate what I have in mind. We ance plan which received acclaim they are right.
forget that Army officers have
are in the midst of legislative de¬ from the press with little realiza¬
always wanted compulsory mili¬
bate on the continuation of the tion of its necessary effect/Under
Office of Price Administration. it/ taxes on payrolls and other tary training and the draft. There
Here is an agency undertaking to taxes
pour into Washington as ought to be such an intense re¬
sentment against this totalitarian
fix wages and prices and regulate premiums to this health insurance
half a billion transactions a day fund.
Perhaps four billion dollars measure that the necessity'for it
There are a great many other
would be everywhere doubted un¬
extending into the daily and in¬ a year reaches the hands of a Fed¬
til proven, and the alleged reasons
pseudo-liberal organizations tend¬ timate lives of 140 million
people. eral bureau which then under¬
ing to follow the same policy. We It is admitted in
subjected to critical examination^;
theory that it is takes to provide and pay for
are
swamped by delegations in inconsistent with business and medical care to 140 million citi¬ Instead of that it seems to be
Washington who come there to individual freedom. Its existence zens. A vast organization of Gov¬ considered liberal to accept this
support every measure limiting can
My I
only be justified by the great¬ ernment officials will have to be necessity ^without question/
own
freedom, who attempt to coerce est
viewj is that at V-J Day, the
necessity, such a necessity as set up to employ all the doctors in
War Department should have be¬
by threats of reprisals in elections
was produced •• by World War II. the Unitedr States to>furnish this
the thinking of men and women
medical care.
The doctors will gun to build a peacetime Army, to
in Congress.
If they engage in
Danger of OPA's Continuance
have to be told when they can build it from the bottom up by
argument, it is argument clearly
But the danger to freedom in¬ call at a home and when they volunteer methods. It knew that
recognizable as a party line, laid volved in its continuation inters Cannot call at a home, when they this would be ultimately neces-.
down by their parent organiza¬
Instead of that it let a
ests few people except the busi¬ cap perform operations, what kind sary.
tions.
wartime Army disintegrate until
They are intoleraiit of any nessmen who are
directly affected of medicine they can prescribe,
argument
made
against
them. by it.
it is suited neither to peace nor to
Every presumption ought and every detail of the service to
They accept the dogma proclaimed to be in favor of
ending it at once. be given those to whom they are war, and it has blindly relied on
by the Government without crit¬ Those
In effect, the entire the draft to fill up the ranks. The
desiring its continuation assigned.
icism or analysis.
should
be
made to
prove
the medical profession is to be nation¬ War Department campaign for
volunteers has never been under¬
necessity beyond a reasonable alized and become employees of
Defends Lobbyists
taken with serious energy,1 and I
doubt. | Instead of that, the pow¬ the Federal Government.
The formation of special inter¬
am afraid it never, will be until
erful propadanda against inflation
Of course the doctors are op¬
est
organizations has hot con¬ has
Congress ends the power to con¬
put all the burden of prbof on
The
tributed to liberal thought.
Rep¬ those of us who believe that lim¬ posed to any such action.
script men.
Surely, in a nation
great bulk of the people view it
resentatives of business 'groups,
where fifty million men work, a
itations on freedom should be re¬ without realization
of what is
labor groups, and farm groups are
million and a half can be found to
moved as promptly as the neces¬
actually proposed.
They are for
employed for the specific purpose
serve in the Army if conditions
sity for them ceases.
health and better medical care in
of representing before Congress
are
made suffciently attractive.
What concerns me is that the whose name this measure is ad¬
and the public the interest of
So are we all,
I have Many of the existing occupations
people gradually come to accept vanced,
those groups.
All of them have
have ho special charm, and it is
limitations on freedom as the nec¬ introduced a measure giving Fed¬
oaid employees whose livelihood
up to the Army to make its condi¬
essary incidents of government eral aid to the States to enable
depends on representing aggres¬
tions as. attractive
as
those of
They-hear of outrageous treat¬ them to provide medical care to
sively the selfish interest of their
civilian life. Because of the Army's
ment igiven to others with a kin<? those unable to pay for it arid en¬
employers. They are not wicked
delay we may be forced to extend
of dull interest, instead of the fiery courage
voluntary health insur¬
lobbyists as £ represented in the
the draft at this time, but it should
funds.
It can
resentment such incidents would ance
accomplish
They
simply paid
the right of others to
nit differently from - himself.; press.
are
"urd, be open-minded in the con- agents who have a perefct right
Oration and acceptance of new to speak ( for those whom they
•j 'sas as opposed to orthodox dog- represent.
Ordinarily they do so
i
a and accepted practice.
effectively and politely.
But the
*
I-*
Bureaucrats' Siren Song
application for work. I
through the hearings oh the-
every
sat
,
Certainly,
f
J
The cry of the
reaucrats
the National Labor Relations Act
to
i",•/''
.•/<»_•".*• "-'/'V•
v-jj:
'i
be reconciled
the; economic field than
would the uncontrolled law of de¬
:
This altitude unconsciously ex¬ mand and supply^ even v>under
In
tends to many newspaper editors, present abnormal conditions.
columnists,
and
commentators meat, lumber, corn, butter, the
who think of themselves as lib¬ whole economy is shot through by
policies en¬
dorsed'by their national officers,';
of some
:
Thursday, May 16, 1946
by
people cannot be
if
the
they
accept
as
proposal
Government, and
dogma
every
setup does not contribute to lib¬
eral thought.
They are
of any point
of view
intolerant
opposing
their interests.
They are not con¬
primarily with the effect
of proposed measures on freedom
or freedom of thought. They are
likely to concede a good deal to
a
totalitarian
regulation
if
it
cerned
the
in
moves
;nterest, '
direction
•
-
-
-1
•
;
of
their
.
'
Even those
groups formed for
the discussion of public questions,
the
very
:stence
freedom
dom
crom
reason
is
of
of
whose
for
desire
a
to
discussion
free¬
thought, have moved far
their ideals.
ganizations
Women
like
Voters,
Women's
the
the
or¬
League of
Federated
Women's Clubs, and many others
have representatives in Washing¬
ton.
They
to be closely
tied in with the Government and
prepared
ment
to
seem
accept
policy and act
:,:,v
any
Govern¬
as propagan-
That is
purpose
every
the
of
Truman
that peoples throughout
history have come to lose their
freedom, by ceasing to have any
interest* in it and gradually ac¬
cepting
limitations -imposed
usually under legal forms and on
job like every other necessary job
without
extending
Government
control into every home and; in¬
be ended at
plan.
grounds of alleged necessity by an
arbitrary ruler or an arbitrary
government.
The
many
to
we
America the best medical service
in
desirable objectives,
Defense,
have
We
seen
are some
in
of those
recent
years.
can
do this
terfering with the freedom of the
technique is the same in
Slogans are built up
for
world.
the
citizens.
daily lives of our
and
they are made to assume
gigantic proportions in the popu¬
lar mind.
War. Peace, Social
Security.
Anti-Inflation,
Na¬
tional
But it builds upon the ex¬
isting foundation which has given
'
>
I: We
have
FEPC bill.
consider an
Undoubtedly there is
had
-
to
employment
in
discrimination
against various minority groups,
especially negroes. • The problem
is a serious problem, but it cer¬
tainly does not have to solved by
method proposed in this bill.
Under the Chavez bill a board
the
Every
one
of them is a highly de¬
sirable goal, but in every case
has'also
been
used
an
it
excuse
for further limitations on
freedom,
in
Govern¬
and
further
ment
power
increase
and spending.
forget that the real object of
foreign policy
policy
and
our
is liberty, and
Men
our
domestic
that other
with
responsibility
little
will
practically govern employment in
the United States.
If a man or
woman
applies for
employer large or
told
by
this
not he must
-
a
job, every
small will be
board
whether
or
employ the applicant.
The bill applies
the technique of
a
definite date.
Three Totalitarian Measures
Here
three essentially
are
talitarian
to¬
one
every
measures,
of which
brings the Government:;
daily lives
of all its citizens. One directs the
into the homes and the
education of boys.
the
to
One regulates f
price of every purchase, and
some
extent the amount of the
The third regulates
in every illness.
imagine a program
short of Communism interfering
more with individual and family
check.
wage
FEPC Bill Not Answer
fields.
stand
ex-
promote
and
have aroused in the past.
the way
service
medical
It
hard
is
to
'
freedom.
>
In the field of international re¬
lations and the United Nations we
have
But
a moderate course.
faced today with pro¬
pursued
we
are
posals
for a
executive and
World
State,
with
legislature and the
armed forces which would accom¬
pany
such
proposals
a
grant of power. These
are
advanced
and ac¬
cepted by many who don't seem to
realize the implications, and
there
'
(Continued
on page
2670)
(Volume 163
AfcIII
I
II
—
THE COMMERCIAL & FINANCIAL CHRONICLE
Number
2669
■'
■
160,000
150,000
As
matter
a
MO,000
130,000
120,000
110,000
100,000
90,000
OWNERSH P
60,000
of Public Interest
ANNUAL REPORT OF STANDARD OIL
•••:'
;■»
!>:\
; v.'-."
->£,
/.
...;:
V-
.:,
Because Standard Oil Company (
.i£'l<^
one
20,000
WIDENING OWNERSHIP OF JERSEY is shown
SOME HIGHLIGHTS FROM THE
...
;;t*'&•. -^r >;>•&»•/.
50,000
,;y<l'.
i"' y:.y\-
•
*
....
•••':
...
..
.-v'-V
■,:
:
■;'£'•'♦•• .:j;
-U:'.
has increased from 5,816 in 1912 to 160,025 as
(N. J.)
.*:TA■f;.•'.'.v':7C''■'•■ £ •'v''Y1 ■ '
''
•
WAGES AND
selected,
as
DIVIDENDS
"" 7,"• ■ '•■!.V'l
v'*
>000 Employees Scared
of the nation's large enterprises, its operations may be of interest not
only to shareholders and employees, but to others
of
December 31, 1945.
i*yi.•.
Jersey) with its affiliated companies is
New
,J :■.'-i;'
by
the fact that the number of shareholder accounts
jtttitiii'314'042'000
well. The following facts
utttm
from the Company's Annual Report, just published, provide a good
summary
of the Report and
the developments of greatest public interest
cover
160,000 Owners
EUGENE HOLM AN
FRANK
PRESIDENT
CHAIRMAN OF THE BOARD
W. ABRAMS
Shared *68,334,000
iliHHi
was a
affiliates
World-wide sales of refined
were
other
any
called upon to a greater extent
than
to fuel the armed forces of the
company
country. They were the largest producers of 100
gasoline in the world. They produced, in
octane
Government-owned
as
much
of the
plants which they operated,
synthetic toluene (for TNT) as all the rest
world
combined.
They
were
the
among
largest producers of the raw materials of synthetic
ftftttftfttftl
rapid return to normal competitive activity;
End of War During World War II Jersey and its
products in 1945
at the rate of
1,193,000 barrels
of 4
over
percent
barrels per
day
day,
per
were
increase
an
EACH FIGURE REPRESENTS 6,750
the bars represent
1944. Of this amount 694,000
were
group
sold in the United States
was
was
sum
of
paid to employees of the Com¬
and affiliates in wages, salaries and benefits.
Dividends amounted to $68,334,000.;
5
pany
Research Until the end of hostilities Jersey
search
received from Jersey in 1945. The
$314,042,000
domestic market.
PERSONS, and
the amounts of income each
almost entirely
on war
re¬
work of highest
importance. Immediate postwar research budgets
.
rubber.
will
Reconversion Reconversion
smoothly and quickly. It
was
out
possible, with rela¬
tively few difficulties, to change
cate
carried
was
from
over
an
intri¬
pattern of manufacture and transportation
designed for
a
nation at
to an equally complex
war
pattern fitted to a nation at peace, and to begin
supplying,
upon
unrationed
short notice, civilian demand for
gasoline
and
other
many
products.
Oil Production World-wide production of crude
oil
per
by consolidated companies
day,
an
increase of 8 percent
1945 the domestic crude
ates
was
995,000 barrels
over
1944. During
production of Jersey affili¬
represented 9 percent of the oil produced in the
United
States, and their world-wide production
amounted to
13.5
of the oil produced
percent
budgets
Refining The amount of crude oil processed in
the
domestic
and
foreign refineries of affiliated
an
per
day—represented
increase of 5 percent over 1944.
domestic refineries
Crude
run
to
13 percent of the total crude
was
Transportation From the outbreak of hostil-)
ities in 1939 until V-J
Day, 96 tankers owned by;
Jersey and affiliated companies were lost, either
,
through capture
collision,
or
or
seizure by the
enemy,
sinking,
a program
inquiries
prewar
to carry over into
a
PUT BACK
and to
war,
INTO THE
DIVIDENDS
BUSINESS
SHAREHOLDERS
products.
on
petroleum
as a raw
Employee Relations Jersey and affiliates
tinued to enjoy
tions. When the
con¬
excellent labor-management rela¬
war
n
ended, Jersey's domestic
/
•
pe¬
troleum affiliates proposed upward adjustment in
wages
and salaries of 15 percent. This
was
t TOTAL "INCOME DOUAR
accepted
JnOfuiV
March 1, 1946, an additional 3 percent had been
;
negotiated and accepted. One of the best evidences '<
of the
of the domestic employ¬
who have been released from the armed forces
have returned to the
Company.
More than 79 percent
ployees
the
•'i;i 'noi'.
satisfactory employee relationships in Jersey
is the fact that 95 percent
ees
"45
.w:l
by all employee bargaining agencies involved. By
are now
THIS SHOWS THE PROPORTION OF NET PROFIT
made by Jersey and affiliates out of total income in
of eligible domestic
em¬
buying term life insurance under
Group Insurance Program for
a
total
coverage
$160,241,800.
1945. It shows also the
proportion paid to share¬
holders in dividends and that left in the business
to meet future
rest
capital expenditures, etc. All the
of the income
was
required to
pay
wages,
purchase materials and meet other operating costs.
Employees participating in the Thrift Plan
con¬
tributed last year $15,019,011, which was supple¬
mented by
processed in the United States.
part of
material for many
of
companies—1,119,900 barrels
as
continue scientific
.>-lf Vifevf•.-V/.'-!:"';
■
approximately 50 percent above
peace-time world research begun for
throughout the world.
A-'.-''
be
Company contributions of $18,921,235.
Earnings Consolidated net earnings
amounted to
in 1945
$154,156,196, equivalent to $5.64
INVESTMENT
PER EMPLOYEE
IN PROPERTY,
per
share* For 1944 the consolidated net earnings were?
equivalent to $5.69
per
share. During the
Company paid dividends totaling $2.50
year
per
m
PLANT AND
the
EQUIPMENT
share.
stranding. The lost vessels have been
partially replaced, and plans
further to the fleet's
are
under
way
to add
Marketing Everywhere, throughout the
marketing activities
were
in the United States and in
war,
largely regulated by
government directives, and when these
some
foreign
Statement of Principles in order to make as
as possible the
Company's outlook in today's
clear
carrying capacity.
were
ended
areas
there
changing world, the Board of Directors has: pref¬
aced this year's. .Annual Report with a special
Statement
of Principles. This
for'
our
viewpoints and policies of the Company,
1626,
[Copies of the full Rockefeller available on request. Address J
report are Plaza, New York 20, N, Y. 1
Room
expresses,
stockholders and for anyone, else interested, basic
30
V
,
v
FOR EACH EMPLOYEE ON THE PAYROLL,
and
STANDARD
OIL
COMPANY
(NEW JERSEY)
AND AFFILIATED COMPANIES
its
consolidated
companies have
Jersey
invested
$22,600 in property, plant, and equipment. The
gross value of capital investments in lands, re¬
fineries, pipe lines, tankers and other, properties
necessary to provide 108,000 jobs was $2,441,942,488 at the end of 1945.
V''
*
..
-t'
:V-
'..it
2670
■'
••':
-
.
.
.
(Continued from
'J'1'!
.<
page 2668)
is, less public criticism of the plan
all
but.
a State, we would
minority representa¬
a
tion.
The
nated
by peoples who do not
State would be
domi¬
even
the
formed
basis
form
our
of
govern¬
officers and armies would enforce
the law., A large number of the
"Pseudo-Liberals"
When
in
men
^
Congress
raise
are
that
is
son
think
Congress do.es have
these issues
on
people do not.
could
raise
be
we
freedom?
member of such
a
If
Yet
sole
our
burden
these
we
lose
our
national
which
our
national
mediately
retain
we
individual freedom?- ~
•
■
.
the
and
It should not be
in Congress to
issues.
A
.
prominent
our
77
and
freedom
limits
measure
,
to
Americans
ex¬
•-
-
,
We all know that America still
are
we-surrender that
freedom in the interest of .peace.
In 1776, ourV ancestors preferred
?
desires to be
liberal nation.
a
-
JJJJ?
4:
happens to be. a small .qne which may he the opposite of liberal, ;
The au- |
does not carry too much weight which is authoritarian.
at the polls; then voting for spe¬ thoritarian in politics is the one I
democracy, / wherein • the people cial privileges; immunities or ben¬ who believes that a particular ;
govern through elected represen¬ efits becomes a symbol of reaction. group, whether it be in govern- •'
tatives. It is also a constitutional This formula seems to be based mem, in labor, or in business, has I &
democracy. Neither Congress, the on the theory that
simply by a special mission to plan ; the f:
Executive, nor ihe courts have passing a law in Congress we can whole pattern of society and to |
absolute power in their respective give a great: many people some¬ require all individuals, whether ;
jurisdictions. They are limited to thing for nothing,. It seems to me they like it or not, to fit into that II
the powers specifically granted to very much the same kind of po¬ pattern.
The authoritarians may ? ?
them ih: the
Constitution^ and litical philosophy as that on which be very well-meaning people who j
even in the exercise of those powr
the early .Caesars of Rome .oper¬ want nothing more than to do - ?
ers they may not encroach on the
ated when they kept the people good for
everybody.
Or they ?'
righ.s and freedoms of individuals acquiescent with bread and cir¬ may be individuals who want ] *
guaranteed in the Bill of Rights. cuses.
power simply because they love J"
The dramers of our Constitution
I do not agree with the theory the exercise of power, in which
were convinced, I believe rightly
You will: ;
that we ever get something for case they are tyrants.
so, that too great concentrations
nothing. We always pay in some notice that under my definition of ?
of political power?; are Jangeroiis
coin for progress and for benefits liberalism and its political oppo¬
.
,
for thorough
amination.
advocating thiat
skepticism
arouse
demand
a
im¬
ought
£>/
Thursday, May 16, 1946
f
losing
freedom, how could
7
a
tu-
(Continued from page 2644)
majority decision is final and ab¬
solute* Ours is a representative
Vocal
nation
representatives would believe in
totalitarian
government.
How
Slate without
•
i
these issues, they are likely to run
into a general course of condem¬
to
M
Liberalism Abroad and at Home
and the charge that they
standing in the way of liberal
ment or the method in which we
progress.
Congress is accused by
think. Laws made by them would the
pseudo-liberals of being out
fall upon our i people, and ; their of touch
with the people; the rea¬
understand
■MiA:
W
of
thinking :of the founders
of this Republic. 7 The subject is
not discussed or thought fcbout.
In such
hold
which
the
than tnere is of the United Na¬
tions.
'
:yHE'COMMERCIAL & FINANCIAL CHRONICLE
issue
What Is A Liberal?
.
t:'
fa
jib'4i.il
If
it: jmhst layJts primary ,em
phasis on freedom.
It iftust ac¬
freedom to peace—else we would cept the good: faith of those who'
not' be an independent nation to¬ differ with the current f dogma,
day.' 'It is inconceivable to me and condemn - the smear tactics
so, *
to
freedom, and that a bare ma¬
jority can be as tyrannical as an
absolute monarch. Therefore they
received,
mental
or
whether by additional
physical effort, by some
site, authoritarianism, both fascists;
and communisis fall into the lat¬
They are as like as 1?
curtailment of the freedoms which ter category.
&
only we have enjoyed previously, or by Tweedledee and Tweedledum in
limited powers,'and protected in¬ the restriction of the freedoms of their determination": to force- all» ^'
dividual rights even ragainst those the members of some
individuala in society to fit into j: I
particular
powers of government. And then
their particular theory of what is
>
group in society.
whose real purppse is |o limit
they provided that the Constitution
a perfect society, and they are at
\
y The
industrial revolution, for
freedom of thought.
It must rec¬ could not he
one in their opposition io freedom
amended^except by
oncile
progress
with
methods vote of two-thirds of both houses instance, brought about a tremen¬ and
dignity for the individual.
.j gi
dous increase in material living
which do not create and encour¬
of Congress and ratification by
One more thing.
Liberals must 5 V
standards of the people wherever
age in-this country land through-^ three-fourths of the States.
They
it occurred. We paid for that in¬ be constantly on guard against r ^
out? the world PUhCiplea of to*were
taking no chances on the
tyranny
and
authoritarianism j "
crease in a rapid growth of city
talitarian government.
.
liquidation of individual freedoms
wherever
and
whenever
they I?
slums, in curtailment of economic
by~ a bare majority.
show their heads.
Liberals have J
freedoms and psychological mal¬
The resulting system of checks
learned that there can be no com- i
adjustments of individuals which
wrote into:the. Constitution
*
7
that
with
liberal ! people tan - view
a
even
indifferent interest the
idea:
of } world: government? ac¬
cepted by so many-in this country
today.;; Distinction between such
a
government and the United Na¬
tions is obvious.
tain
In one,we: re¬
with
certain
limitations on action
freedom
our
reasonable
abroad to which We agree.
other,
we
surrender
to a government in
.
In the
freedom
our
which we have
only minority representation,
Speakers for AIB
and
Convention in June
JTyo nationally known, figures
have: accepted invitations to hd*
.
;
Foreign Policy- Not Based
.
Justice
-
-
t
Nor do I think
we
on
torial
claim to
in
Europe and
Asia. It is hardly liberal to agree
to the extinction of liberty in Es¬
tonia, • Lithuania, :. Latvia
and
Poland. The-extending *of jbstice
throughout the W0rld!}may be and
is beyond our'
power, .but cer¬
tainly;, we need not join in the
principles by which force and na¬
tional policy are permitted to pre¬
vail
over
decisions
except after
times
freedom and justice.
we
is. also Assistant Cashier of
the First National Bank, Boston,
Mass; ;The American Institute of
William
H.
months
have filled State mental
to
hospitals
overflowing.
False Liberalism
not made
are
and'
some¬
of public discussion,
have built up an over¬
years
pay
for freedom and democ¬
Many proposals
vanced
label
today
of
does for
ing
racy.
a
prove
Essentials of Our Democratic
tee
System
Banking is the'^ educatiohai aectipn
ofjhe American Bankers Asso¬
Rev.
down
are
under
being ad¬
this
false
liberalism,
designed to
which
assure all the people in this coun¬
whelming, not merely a bare ma¬
jority^ ^public Support dot >the 6e* try a high standard of living, re¬
cision made. -; That: ia the price gardless of what the individual
who
ciation.
slow
does
generally
the 44th annual convention of tthe
on
settlements
balances
dress 'the two ^general sessions of
v>
can
foreign policy when American -Institute of Banking,
we, continue*
the policies which which-will; be held at Cincinnati,
dominate our actions in "Europe. Ohio, June 10-13 Inclusive, it.has
There can be nothing further from been announced by David T*Scott,
Justice than the proposed terri¬ National President of the Institute,
be liberal
:
government in ra democracy;
It
cannot change the rules by the
stroke of one man's pen.
Major
for
Two
Alex«-
thixigs
are
essential if
our
democratic system is to meet ef¬
himself, simply by pass¬
All history should
law.
to
to
us
that such
individuals
eventually in
a
will
a
very
guaran¬
be paid
precious
coin indeed—the coin of individ¬
ualhqman freedom.
It is my conviction that tO be a
ander? pastor of the First Christian fectively: the challenger it faces.
Church,: Oklahoma City; Okla., One is that the electorate know political liberal, one must be de¬
will speak at the
jopening, general the facts and .hear; both, sides of voted to liberty. I mean liberty,
session of the convention on Mon¬ every issue.- The second is po¬ not for any particular group in
I day afterriooh,- June,10. Rev. Alex^ litical leadership that is willing sodetyy! whether Jtvbe- workers,
believe that all Americans should
;
ander
is well
knpwn throughout
to really give leadership,-based on
farmers,
view, with distrust the war trials the Southwest as the radio min¬
which are going on in Germany ister of Oklahomajs "Little Church
fundamental principle rather than
men, but liberty for all individ¬
uals as individuals.
I don't think
following whatever appears to be
Dri piark G; the majority opinion of the mo*
Kuebler, President of Ripon Col¬ ment. We are deficient in both
dom of that procedure, but they lege, Ripon, Wis., will be the prin¬ today, I Too many individuals? are
dp violate; a fundamental prin- cipal speaker at the closing gen¬ hearing only that side of any is¬
ciol? "of American law against ex eral session of the convention on sue which the
particular pressure
pcsi. facto legislation, a principle Thursday afternoon, June 13. Dr.
group with which they are affili¬
wb'ch in 177,6 we regarded as an Kuebler it is stated is internation¬ ated wants
to. present to them,
e~?cr1ial element of liberty.
Our ally known as a classical scholar and they make no real effort to
policy is, stiir„dominated?moreby and ' educator.
Before assuming hear the other side. And far too
ide^s oi vengeance'
thanjiy prin* the Presidency of Ripon College, many politicians who know the
eiplh? of justice. We ,hekr of fu¬ he was a member of the faculty of facts and could help us make the
stic'-s of treatment of the Ger- Northwestern
Un Iversity: at right decision on issues are in¬
man^
wh:ch would certainly be
iEvanston, 111., and one of the lead¬ stead following the path of ex¬
thrv~M tyranny if used
against ers in the revision of college edu¬ pediency land exploiting rather
and
Japaiu
I do -not purport to
final judgment on the wis¬
pass
ourselves.
cational objectives.
Germany
.
,
Our
policy seems to be based
the, theory -that we" can edu¬
cate
the Germans
ent kind
of
to be
a
differ¬
people than they
and make them think as we
not
a
very
thermore,
are
think,
liberal program. Fur¬
it? is so contrary to
human nature that it is bound to
fail. We cannot consciously change
the
methods
own
a
different language; We must limit
by force the -freedom of the Gerx
mans
not
to make
war.
But
as
they * are. with ..the liberal¬
we proclaim:. - V ■
ism which
I do. not -wish to indicate that
position on the various sub¬
jects which I have discussed, is
necessarily right. I only want to
point out that the people no longer
my
seem
to
be
concerned
about the
basic issue of human freedom, the
than helping to dispel, ignorance,
.
and
chapters
the
discuss
th<j
of
study
educational f program
on
Will
groups
Institute's
placing emphasis
AIB
various
^postwar
which
is
plans to aid
veterans and on the postwar edu¬
cation of
lation
of
bankers.! In the formu¬
these
national
policies,
departmental conferences to
be held
play
an
on
June
bigotry and prejudice.
;
believer
in
democracy
Tenn.
Homer B. Clarke
was
reappoint¬
ed Tennessee State Superintendent of Banks
April 23 by Gov¬
on
ernor
McCord for
four
years
it
a
third: term' of
was
reported: in
Nashville advices to the Memphis
"Commercial Appeal."
The bank
superintendent joined the Bank¬
ing
Department
in 1928.
as
an
examiner
..
j,f
;
There ^re a great many groups
in
Banking Dejit.
-
meaning only
dividuals.
A
it applies lo in¬
political liberal in
as
dictionary has two primary
objectives.
One is to assure the
greatest degree of economic and
political freedom for all individ¬
my
uals consistent with
the
same
enjoyment of
degreelpl ?freedom^ lor
all other individuals.
The second
objective is equality for all" in*
dividuals.
I do not
equality,
which
mean
America
,
a
are vigilant against any abuse of;
justice or the principle of equal-:
ity before the law wherever it
occurs, whether it is the denial1
is
;
?
;?
economic oppor- J
tunity to negroes in America, the!' \
appeasement
of
a
dictator
at
:
Munich, or the appeasement of a | •
slightly different kind of tyranny
of civil
rights
or
,
?!
in Iran.
Applying this yardstick of
po~jr /
litical liberalism to foreign policy:
issues* we immediately find a
sharp fhonflict 4m plineiples. ?AJ?
large part of our world, including
<
one great power, Russia, operates
under authoritarian political sys- J
terns
which appear unlikely to ?
change soon. Solving complicated;
issues through public debate and
decision is a tough job when the;
debate is ^conducted, as it were, j
in different political languages.
That difficulty
by
Rather,
will not be elim- ?
brushing
jt
aside!? J
hope is to face it |
struggle patiently
our omy
and
squarely
,
task of achieving common
understanding of a few essential?
principles. That this is not a completely hopeless undertaking is ?
demonstrated by our agreement j
at the
on
Nations- and
United
the
that infant organization
surviving political storms.
way
absolute
;
?
|
the,
is?
Since liberals seek internation¬
'impossible ally expahding opportunities and
among Jiiiman beings and could
be achieved only: if we turned
into robots, but equality of oppor¬
will never find
,
] .Freedom has inated
.
Against that background of ••.the]
fine political liberalism,
Clarke Again Heads
anything in rela¬
tion to any group.
,
democratic process, let's try to de¬
c
means
professional
practice what tunity ahd equality before the law
Voltaire preached when he said: for all individuals. ;The key word
"I disagree with everything you in this 'definition of a liberal is
the individual.
A -liberal judges
say, but I will defend with my
life your right to say it."
It is issues as they arise primarily on
all too apparent from the reac¬ whether their net effect will be
tions to the recent speeches of to expand or: contract -the^ sum
Winston | Churchill ' that : some total of opportunities .and freer
Americans - have
forgotten | this doms enjoyed, not by any particu¬
fundamental precept, of democr lar group in society, bdt by all of
tfie .people as? individuals.
You
racy.'
*
ill and §12, Will
important part,
Every
freedom
or
and liberalism^ must
we can¬
long
interfere with
their
power to govern themselves and
still stand for liberty and free¬
dom throughout the world.
But
there seems :to be no; concern in
this country about our actions
throughout the world,< inconsis¬
tent
sentatives
of thought of our
people, v much less that of jjie
people with different ideas and
:
During the three days of the
convention,J 6ut-bf-town
repre¬
Condemns Policy Toward
on
Around fhe Corner.-
business
promise in the centuries old struggle between tyranny and human; J
freedom, and consequently they
liberal accord¬
ing to my definition talking about
"the masses" or
"the common
man" or even "the average man."
To my kind of liberal every in¬
today which appar¬ dividual is very uncommon. He
ently judge a. public officials, is a human being with a soul, not
liberalism on the basis of whether
merely a .complex assembly of
he is willing to support any; and
appetites "and fears* ' \
* " I
all legislation which purports to
The political opposite of liberal¬
give additional rights, immunities,
ism is not conservatism..
A polit¬
privileges, or benefits to ; some
ical conservative is. merely one
particular group in our society. I
who says, "Let's go slow about
notice that those who use this for¬
destroying or changing-our pres¬
mula to determine whether; a poli¬
ent institutions."
The opposite of
tician is liberal always insist that
a
conservative is a radical, who
the group receiving these special
is always ready to try almost any
benefits or privileges must be a
experiment.
Both conservatives
very large group with plenty of and radicals may
be liberal in
votes.
If
the
their basic philosophy or they
recipient group
individuals
for
freedoms
under;
Iswk they will support whole-1
heartedly the United Nations, as i
the only instrument in existence !
which might eventually achieve s
that-goalr
Liberals will seek at!
opportunity
every
United
the
strument
to
transform
«
'
<
Nations into an in- i
suited to this task; i
more
by modification or elimination of I
the unliberal veto power, and by j
implementation and strengthening of those expressions of con¬
cern
for individual rightsand j
freedoms now in. the charter.
i
thev economic field, liberals)
multilateral trade?
; In
will
seek free
opportunities for individuals. The j ?
trend
in
the
1930's
was
toward i*
growing governmental control of |
international trade, with
sening
for
opportunity
ever les- p
and freedom^
individuals in this
reverse
field.
To?
that trend and expand the;
freedoms and opportunities of in-;
dividuals in international trade, ;
liberals
of
high
will
support elimination and other trade'
tariffs
barriers.
Such institutions
Bretton
Woods
as
the
monetary
fund
and bank, designed to facilitate,
multilateral trade, help toward
this objective. The pending loan
to
Britain, to assist the world's
:
Volume 163
I
Number 4490
greatest trading nation eliminate nomic security for all, but the:
4'barriers to world commerce, fits greatest possible degree of ? equal¬
into this liberal vgoali "
;•
^1 < f; ity of opportunity for ^ali .in the
*■
'I 'thinlc those who ^support <lib- economic field,; with an insistence
! eralism in our foreign policy must that measures to achieve this goal
-also support measures—-such -as must expand rather than curtail
■
:
.
CHRONICLE
THE COMMERCIAL & FINANCIAL
ion
What the individual "himself does:
individual
military training—which will as¬
sure that the United States, as the
seems
This
freedoms.
Ad¬
achieving
.economic,
his
achieve
des- have
economic
own
a
;
leading proponent df * liberal prin¬
'
ciples,» will not^become so-tweak
that our'voice is impotent 4n,inr
.'"ternational affairs.
;
-
.Ip; ■<?
be
to
approach basically
that
government
should guarantee everyone a high
in the early 1930*8 were so
-tendency to confuse -eco¬
Minor children do not have the
.security >with
freedom. freedom of adults. -They have all
tiny* and then leave it up to the
nomic
individual.
Actually the most
•
ministration's
many
The liberal approach is that/gov¬ security for everyone, that we intent on achieving economic sei
ernment's ^obligation is to make may achieve it at the expense of curity that they permitted their
liberties to be liquidated without
sure that every individual has a freedom—both political and ecofair
1
apd equal ipppbrtuhity to nomic-Afor ;the individual. : We; even a fight.
*
the draft extension and universal
267V
1
There lis
that in
f
today
real danger
a
ual
discussion of political
our
in
serving
secure
society
our
is
a
the
their
life sentence, but he is
a
economic and
individ-'
prisoner
families
c$n
but they are not
of
living
regardless
of issues
(Continued
The people of Ger¬
hardly ifree.
will yplace. so much em*
we
and
justice. I After
the
| United Nations has evqlyed into
an
agericy strong enough to -pro-i
mote,, and safeguard freedom, and
\ justice':on the worid level, liberals-
t.can rely sQlely on moral " strength
and reason. ;But in the preseht
troubled world' we must have^the.
-V; military strength1 to fiuppofc&tbute
i
i
p^ncmles
necessary, v
The scientists
*■
of the Philco laboratories have fulfilled the promise
yi
"
of modern electronic research. Patented and exclusive
;
.
^^na^^4hink tot^throj^^irt'
developments like the revolutionary Advanced-FM System
to.see*
and the sensational Dynamic Reproducer
our;$*tate Department ah
bring
you
politicalTTeaders^^^^^less ?bashfi^l
^our
,
about'
^rpHaiming the meaning; u
bandvaluesbfdemocracyandirehrv
iJdom throughout the
world.|-#if|?
tendto Support^pprQpriatidhsjfor
the
new
toys
you
have hoped for from radio and
■-
the State Department to
cohtinuh
recorded music. Hear the 1946 Philco and judge for yourself,
£ impeacetime such activities o&the*
; Office of War Tnfdrmation as will,:
£ further that objective# It is]duiW
true that we: have no right to in*
-
£.;tervene* "unllgferally in the inter]^nal affairs'or choice of goverh-
ifiehf of
>
an^i natiom $L: think
we
that
I .Mnd of intervention in Spain and
bradea mistake in attempting
Argentihh^ieveh/^
g
oist^dis*;
Jike the types of government es]% tablished in those"couhtries. But
i] refraining from direct intervenr
^'tion':j^^n^rx4ttbh^does.An9t'^meair
that we cannot advocate, the prin¬
ciples of individual human -freer
dom .and- dignity,] We can - and
should^eize every opportunity to
tell, people what democracy means
Srto individuals. Our policy never
should support or lend economic
*
(M |
'
,
y'
.
'■ '•
..
1
-
.
^
^
v
'y-.
*
'
1 >■
■;
■
"A■%', W?
or political assistance to "regimes
in any^-country which trample
^
.
.roughshbdoyer'ihdividual^ights
f^and freedoms, •*
V •
*.#j'
f
After all, this conflict
betweep
tyranny vand freedom is not a new
vpone. It*fias been going on for cen_
freedom
turies, "and
i
*
:;
\
1
#
1
! "
"
Which
the]! Fascist and
both
<
ij/l
In
the
—]
Communist
dictatorships h a ve
given- in recent .years,' the1 fact
is they are the same old brand
'
f
,
^
^
.
-
| of tyranny operating under differf
ent labels, ; Human freedom an(i
individual rights *and dignity- still
t
have a,.vitality and -an appeal to
-
I people
throughout S the
•
?
wbrld
r.y
i
'
\k!v
-
;
f
■
j^wwBssr--
—•,
'
fel •'
;
'
•
1
k
#an;;havfe j
j; i^vhich^yroppy
'
!!;:
us>
■
I
'
spite, of -the dynamic -appearance
I
■>
'
'•
has j|been
I gaining ground all the time.
r
^
t-f
•
■
1
,
_
^
expandinglll^e
{ Our-chance^of
i
freedoms and opportunities of in-
\
divid^alsihefe at liome ; wilkbe
much* ^easier
i
if
we
can
^achieve
-.i
^tabilitfcjustice *'and aYreaSon^itafe
j
!
assurance
of peace in the
world,
,
...
-
j The confinttal threat of war, jlike
j War itself, tends to push pep-ples
nations * int6
and
I
j
authoritarian
forms .and controls.
Here in theT 'United-States^ we - movedj a* long
»;
r
I
in .that "direction during j the
i*ecent;war. #;\1# .##.-■
way.<
-
PISilllf'.
'
I
f That > is -why.' liberals today j are
[ primarily concerned about fort
eign policy issues. - They realize
I
that unless
-
so
?
we
of
our
'
'
*
'
'
'i
■
'
'
"
.
•
•
.
: '
-
allies:can
the world that the
third • world war;:#
organize
threat
and
a
[ eliminated,
or at least minimize#
democracy and liberty]will be the,
war. But;
in our cbncern; with the interna¬
first casualties in such a
tional
scene,
we
dare
not
over¬
look the authoritarian challenge
to liberalism which we face here,
at home.
If liberalism does not
prevajrifT the United States, ] it
will
stand
world.
cussion
.
little
chance
in
the
So let's turn now to a dis¬
of
how
these
principles
of liberalism
apply to some of our
major domestic problems.
]
.
The
goal of ' liberals
here at home is not complete ecoprimary
equipped ,to as-
on page
2672)
I,
V
Liberals are devoted to peace
r and/j ustiee.- But? liberals lare .also:
} prepared to fight, if necessary, forfreedom
security!
give to them,
'
standard
>>,,
i
social
Famoad
Me
/ftMci (yw/l
I.*
S-J.%
Average yield of these eight
stock^is 3.4%; and average divir
dend coverage, 2,05. Highest yield
stocks in this group are Conti¬
nental Illinois and Philadelphia
Bank and Insurance Stocks
From the 1942 lows, the com¬
parison is as follows:^-
'
trust laws,
22.9
vision of securities
48.4
,
exchanges and
regulation of public utility
rates.
It was because concentra-*
tions of
capital then exercised
such vast and uncontrolled, eco¬
for
119.7%
111.4%
National, each at 3.9 %. Dividend Appreciation
coverage in each instance is be¬
From the 1932 lows, the com¬
low average, however,
but still
parison is odious! v
•<!
nomic power that the public in¬
very high.
Lowest yield stock is
D. J. Ind. Am. Banker
terest had become vitally affecte
National Shawmut at 2.9 %, with 1932 LOW—
41.22
23.9
arid individual rights, opportune
a dividend coverage above aver¬
May 8, 1946
204.17
£ 48.4 .
ties and freedoms were being cur¬
age,
Four banks have an un¬
Appreciation
395.3%
102.5%
tailed.
Today labor unions and
broken dividend record in excess
of 100 years, viz:
The 1942 low of bank stocks was their leaders exercise economic1,
First National
and National Shawmut (Boston);
beneath the 1932 low. The high¬ powers which are far greater; than!
Pennsylvania Co. and Philadel¬ est reached by the index since those of the so-called captains of
Bank Stocks
—
for Government super¬
Banker
-r
•
*20447
...
were in thd
for the anti¬
50 years ago liberals
forefront of the fight
"
D. J. Ind. Am.
1942. Low.wi.*—92.92
May 8, 1946,..
.
This Week
.Thursday, May 16, 1945
V
THE COMMERCIAL & FINANCIAL CHRONICLE
267Z
'
The
of
opinion appears to be that the banks will be
able to maintain their high 1945 level of earnings through 1946 and
"1947." This column does not subscribe to this appraisal too literally,
for some banks will still be able to show improvement in earnings
over last year, while others will not.
It seems probable that, genf erally speaking, security profits will be smaller this year, but that
straight operating profits should®
;
—
in
many
instances continue to comparative dividend yields at
show the annual increment of in¬ current market prices,
together
crease.
As regards dividends, few
with relative safety of dividends,
increases
are
anticipated
this as represented by dividend cover¬
year,
since
the
desirability of age, by operating earnings and by
building up capital funds persists. the unbroken record of dividend
;
r
In view of the inherent stabil- payments by each bank.
ity of the earinings and dividends
Figures for seventeen leading
of leading New York City banks,
New York City banks are shown
as well as those of other cities, it
may be of interest to compare in Table I:
consensus
.
.
phia National (Philadelphia). !
Market wise, bank stocks have
been
dragging this year. As meas¬
ured by the American Banker In¬
dex of NewYork City bank stocks,
they have declined 4.5%. On Dec.
31, 1945 the index stood at 50,7,
and on May 8,1946, at 48.4. Mean¬
1929 high of 228, was 61.2 on
the
Feb.
26.5% from present levels.
stocks have been decidely
the general
behind
securities market since
thus far, failed to
completely
from
the
ton Act and the
of that year, and from other "Gov¬
ernmental actions and attitudes.
TABLE I
Historical
Dividends
'! 1
y
^AV;
Annual-
•Safety
Recent
Paid Each
Year
Year Since
of Origin
Market
Yield
of Divd.
Bonk
of
Manhattan
$1.20
35
3.4%
2.60
Bank
of
New York-_^._
14.00
442
3.2
2.38
New York
Bankers
-Central
Div. Rate
City-
Trust—
Chemical
4.00
i
1904
1903
1864
1851,
sume
,1879
1877
risks that
the
responsibilities
and
with freedom, and
consequently we recognize
the
necessity of parental authority.
Every time in history when men
1824
1827
1.71
3.5
51%
1.80
.
go
1.60
49%
3.2
2.85
1931
1928
.'Continental B. & T
0.80
23%
3.4
2.50
1918
1870
Corn
Exchange-^.—
2.40
3.8
2.26
1854
1853
^First
National
80.00
62%
1,910
4.2
1.23
1864
1863
12.00
348
3.4
1.12
1892
1839
and
0.80
20
4.0
1.65
1905
1838
an
2.40
63%
3.8
2.22
1910
1812
48%
3.3
vidual! responsibilties and risks,
whether they turned them [over
to a Julius Caesar, a feudal baron,
jCommercial National
^Guaranty Trust—
tlrving Trust-i_-li^.-:_^.u
■Manufacturers
Trust__
,National City_„
.
1.60
'New
..
4.00
York
"Public
Trust
3,7
1.65.
46
3.6
805
4.3
an
♦Number of times dividend covered by
1945 net operating earnings: alone.
number of
average
yield of these
•stocks is 3.6 %y and the average
coverage by net operating earn¬
have turned oyer to
women
outside agency all their indi¬
Adolf Hitler, or an omnipotent
state, they have also in the end
relinquished
th ei r
individual
freedoms.
1.97
3.6%
The
j
1853
4
1
Average
1908
1854
1.33
1812
1889
1916
2.30
35.00
NationaL_T_„,--
ilL .S..-'Trust_^—
,
1.99
1813
1904;
1.78
t
109
I1 tl! ill I
(Continued from page 2671)
1.48
1.88
3.5
45%
Liberalism Abroad and at Home
1799
1784
2.20
3.5
3.5,
116
:
'
1;60
& T.—___
B.
51%
1.80
Hanover-_j___
National-!-.'
Chase
1848
1784
?
stocks, it will be noted,
1
H
m
and
average.
then the United
States will soon
weak
economically and
the living standards of everyone
inevitably will fall. At the pres¬
ent time our social security sys¬
tem, with its old age retirement
annuities, pensions - for widows
and provision for dependent chil¬
dren
and handicapped
persons,
covers only those individuals who
are
employed.
Those who are
become
cover
to
Dividends
,* "
,
[_ Other Cities—
'Annual
Div. Rate
"First National (Boston)
y
Natl. Shawmut (Best.)
Illinois
Cant.
i First
Natl.
Chicago)—
Natl.
Historical
Year
1785 ;
1784
2.69
1836'
1835
/'1.S8
1935.
V
disparities
•
1862
3.2
•1:84
1935
3.4
2.20
1863
44
3.6
2.33
1827
1811
127%
3.9
1.60
1842
1802
51%
3.1
1.80
1933
5.00,
1.60
V 1862
1904
>
J.
■
Average
!
'
♦Number of
3.4%
time§ dividend covered by 1945
net
[:
2.05
,
in opportunities for
46%
r
tremendous
standards
inequalities
children comM
ing out of such homes, Where all
members of a family must strug¬
gle constantly to achieve the bare
necessities of life, the children
do not get a fair break on educa¬
tional, economic or social oppor¬
tunities.
The demagogue's stock
answer
to this problem — "Let's
families
among
l.ro
246
! living
' in
1856
' "
1.60
(Calif.>_
Goal of Equal Opportunity
It is apparent that
of Origin
Year Since
of Divd.
3.9 P
105
8.00
(Phila.)—
!Bk, of Amer.
Yield
2.9
34%
4.00
»*-*.
;3;4%0TTi.,
58 %
1.00/
(Chic.)_
«.
Paid Each
«»<Safety
•
Market
$2.00
..
j First Natl. (Phii9.)___
^tPenn. Co. (Phila.)—__
Fhala.
Recent
;■■■■,
operating earnings alone.
mean
soak the rich"—is rejected by the
j
new jersey
liberal. He knows that in the final
'analysis, by destroying incentive
and
to individual initiative and enter'
securities!
INSURANCE
prise, such a solution will* tend
pull down the living standards
of everyone.
It might equalize
opportunities but it would do it
to
STOCKS
opportunities for
instead of expanding
by! curtailing
|
J. S.
Laird, Bissell & Meeds
Member*
New
York
120 BROADWAY.
V
;
Telephone:
;
Bell
1
L
A
Stock
NEW
Exchange
B A relay
Gibbs
■
1391
18 Clinton St., Newark
7-3500
Teletype—NY 7-1248-49
Rippel & Co.
Established
YORK 5, N. Y.
;
'
2, N. J.
MArket 3-3430
.
Manager Trading Department)
'
N. Y. Phone—REctor 2-4383
everyone,
them
for
individuals.
all
In the
end, it would be destructive of
.freedom.,. The liberal solution is
I not to pull down the more for¬
tunate, but to raise the less for¬
tunate
to
minimum
a
standard,
leaving it to the individual's own
farm
labor,
that is
me
But it
far
a
more
seems
liberal
Bought
Special
—
Sold — Quoted
REVIEWED
-
Bulletin and Booklet Service to Dealers
& Brokers
Trading daily 7
a.
to 5 p. m.
m.
Inquiries invited.
is
There
Senate
a
now
in
the
version
of
(P, C. T.)
•
'
OF
West 7th
dividual
of
Vnrk
.
Chicago
TELETYPE
of
initiative
proper
our
and
L..
-
A.
San Francisco
279
-
the
L.
A.
-
280
Seattlo
freedom.
social security system and
law is to place a
standards
people and to take
inevitable
casualties
a
tem
not
should
care
in
a
The stand¬
social security sys¬
ards of such
WIRES
-
liberal function
and
free economic system.
St., Los Angeles
PRIVATE
s**
-
relatively high minimum stand¬
of all the
CALIFORNIA
...
ard for all without destroying in¬
floor beneath the living
210
.
.
Fortunately, America is produc¬
tive enough so that we can afford
minimum wage
BUTLER-HUFF & CO.
other
geo¬
only individuals who are strong^
with
trained
minds
and
healthy
bodies, can be truly free,
They
are fully capable of assuming the
risks and responsibilities that
go!
Likewise
freedom.
they
have the best security of all: thai
witn
which
from
comes
dence in their
own
inner
confi¬
ability to meet
Whatever issues
may come.
Thai
kind of security doesn't have ta
be conferred or guaranteed by
Outside agency.
Our emphasis as liberals, there¬
fore, in seeking greater opportu¬
nities and freedoms for individ-,
any
Royal Bank of Scotland
the
pending
revised
Incorporated by Royal Charter 1727
HEAD
Labor Disputes bill, known as the
Case bill, which passed the House
some
ber
.
The amendments
disputes
Bishopsgale. E. C. 2
8 West Smllhfield, E. C. /
to strengthen Federal
mediation machinery for peaceful
of
3
are
designed
settlement
throughout Scotland |
LONDON OFFICES:
proposed six specific amendments
to that bill.
OFFICE—Edinburgh
Branches
months ago.
I am a meniof the minority which has
49
between
Charing Cross. S. W. I
Burlington Gardens. IV. 1
management and labor, to require
64 New Bond Street. W. I
give that machin¬
reasonable opportunity to
function
before
they resort to
both parties to
ery
a
TOTAL
lockout, and to equalize
the legal responsibilities of labor
and
management in this field.
They would do the latter by mak¬
ing unions legally responsible for
violation of their contracts, and
by outlawing secondary boycotts
strike
in restraint of trade
7VSSETS
£115,681,681
or
Associated
Banks:
Williams Deacon's Bank,' Ltd.
Glyn Mills & Co. ■
in
which
The
Orders solicited.
or
exactly the same way such monop¬
a
COMPARED
-
communities
on
graphical areas absolute monopo¬
lies on the types and kinds of
materials which the consuming
of
equality.
imum.
ANALYZED
harmful to society or not, the Fed*
eral courts have absolutely no
actually to restrict it, thereby pro¬
moting, inequality1 instead
enterprise to rise above the min¬
INSURANCE & BANK STOCKS
labor dispute, whether its objec¬
tive is licit or .illicit, wrong !ancl
uals, should be on measures and
approach than to try to raise the
policies which will strengthen the
minimum wage so high that in
individual and free his mind from
order .to1 avoid' severe economic,
fear by giving him knowledge,
consequences; we ; are forced, ih->
training and health.
Only; thus
stead of broadening the coverage,
'
BANK
Act, unions today are above and
beyond the 'law.
The SupremeCourt Has held specifically that
when a union is involved in, #
public can buy and use. I submit
that such a condition is iritolerf
able to any liberal.
Liberals to¬
day should be in the forefront of
the fight demanding a reasonable
regulation of this vast economicpower in the interest of individual
self-employed, professional peo¬ freedom and
opportunity and ther
ple and farmers as well as many
genera! public welfare.
other groups, are not covered by
It is my own conviction that
the system.
There are great ad¬
.
victory in war.
of the Clay*
Norris-LaGuardist
power to impose any
responsi¬
themselvesto achieve
bility. Unions today are by court
higher standards. If they do that decree
completely free to impose-
,
TABLE II
of unorgan¬
exerting
My whole concept of freedom—
I think it is basically the
American concept — includes the
Stocks which provide
ings, excludve of secuntv profits,
aboveministrative difficulties in work¬
willingness to assume the obliga¬
is 1.97. U. S. Trust and First Naaverage dividend protection are:
tions and risks inherent in being ing out the coverage of such
Bank of Manhattan, Bank of New
jtional give the highest current
free. It was men and women im¬ groups but that should be the next
yield at 4.3% and 4.2% respec¬ York,
Central
Hanover,
Com¬
and imperative step in expanding
bued with this concept of freedom,
tively. On the other hand, their mercial; Continental, Corn, Manu¬
this system.
Similarly, instead of
accepting its risks and obligations
[dividend coverage ratios of 1.33 facturers,. New- vYork - Trust and along with its rights, who left the proposing immediately to nearly
rand 1.23 are among the lowest. Public. Length of unbroken divi¬
double the present statutory mini¬
These are closely followed by Irv- dend payments exceeds 100 years safe ar}d y civilized East to push
mum wage, our, efforts should be
West across the wild mountains
iing with 4.0%, and a coverage ra- in the case of Bank of. New York,
and untamed prairies of this great directed toward applying it to all
itio of 1.65.
Chemical and National City.
employment
by
extending the
country, who built our railroads,
In Table II similar figures are
coverage.
It might be necessary
j , Lowest yielding stocks are' Bank
our mines and our great factories,
of New York and Commercial at given for eight leading banks in
and who, during the "past five to keep the minimum wage at
3.2%, with high coverage ratios of other cities, viz. Boston, Chicago,
years,* invented, produced
and only 40 or 50 cents an hour in
4L38 and 2.85 respectively. A large Philadelphia ancj Los. Angeles.;
order to do that, particularly to
used the weapons that won us
;•■■
give yields very close to the 3.6%
of union members but
ized workers. Yet under SupremoCourt interpretations
Average moved from 192.91 to
204.17, ah appreciation of 5.8%.
Jones
Dow
impact
1933, having,
"shell-shock" of the bank holiday
the
the
recover
Industrial
while
industry, both in their impact on
public welfare, and in their
on
the individual free**
Bank doms and opportunities not only
10, 1937; to reach this again,
would require an appreciation of
be
so
high
they will discourage any
proportion of individuals
that
large
from
are
practices
oly
laws.
by
under
outlawed
'
employers
■
Unions
Are
1
Above
are
Anti-trust
the
-
the
1
NATIONAL BANK
of INDIA. LIMITED
Law
Bankers
'*
submit
that
i
labor unions and their leaders re¬
sponsible in some small measure
to the public interest, are in fact
liberal proposals.
Liberals have
always opposed the exercise of
vast concentrations of either polit¬
ical
some
or
economic
regulation,
sponsibility.
power
without
control and
re-|
That is why 40 and'
to
the
Government
Kenya Colony and
these
proposals,
seeking to make great, powerful
I
Head
Office:
in
Uganda
Bishopsgate.
London, E, C.
26,
Branches
In India, Burma, Ceylon, Kenya
Colony and Aden and Zanzibar
Subscribed
Capital
Paid-Up Capital
Reserve
The
Fund_i
£4,000,000
£2,000,000
£2,200,000
Bank
conducts
every
description
banking and exchange business
Trusteeships and Executorships
also undertaken
.
at
,THE COMMERCIAL & FINANCIAL CHRONICLE
Number 14490
IVolume 163:
individuals win the most pre¬
an
cious freedom of all,' freedom -from
fear—the confidence that he can
and will measure up to any
fest
that may come and remain true
to his own inner creed.
Under
that
policy, the Government has
an obligation to see to it that in
.health land training, all individlals start; as nearly equal as pos¬
sible in our society. That in turn
"
that whatever
means
eral funds
are
Fed¬
excess
available when we
finally: achieve
balanced budget
a
should be earmarked first for pro?
Srams and
the long
projects which will in
raise the health and
run
educational
of the
standards
na¬
tion and which particularly will
are less fortunate
better chance at
.give those who
•economically a
Wealthy bodies and trained minds.
A
OPA
for
campaign
present
That is why liberals must fight
communism as bitterly as they
fight fascism, even though
it
J means being called red-baiters.
That fight is more difficult be¬
cause liberals must always defend
the very freedoms which com¬
by '
Chester Bowles and his supporters
/
2m
goal. The easy path is that which
people of Germany, of Italy,
of Russia took; when they closed
totalitarian in
method as is that agency. As an
their minds and surrendered to
the siren call of the dictators:
expert
advertising
man,
Mr.
Bowles knows there are probably
"Give us the power, and you'll
100 consumers for every producer
have bread and jobs and security.
to achieve their What do freedom and democracy
or distributor of goods. Basically, munists abuse
he is telling the large group of end, which is the destruction of mean if you and your children
the consumers that the govern¬ freedom.
It is more difficult be¬ are hungry?"
Not only did these
ment through OPA will run our cause conservatives in the past deluded people who took the easy
economy for the exclusive benefit have too frequently cried "com¬ path give up their freedom, but
of the consumers, and that all munist" simply to defeat liberal today, despite all the efforts of
businessmen are just greedy, prof¬ and not authoritarian proposals, the free world, they are starving.
iteers anyhow.
A certain paper- and consequently many people re¬
No, being a political liberal is
hanger from Austria sold the Ger¬ fuse to believe there is really a not easy.
It is just as risky and
man people very much the same
wolf there this time.
'
dangerous as being a free man
kind of phony economics.
They
Let's
not permit
our
under¬ The liberal can expect to be called
did not wake up until it was too
standable, desire for economic se¬ a
communist
by
the
extreme
late,' but I think the American curity to blind us to other values
political right.
He is sure to be
consumers are intelligent enough
even more vital.
We are seeking smeared as a fascist by the ex¬
to figure out that artificial ceil¬
here in America not just jobs, any treme political left. He must fight
ings on butter, meat, shirts and kind of
jobs, for 60,000,000 Ameri¬ authoritarian proposals that have
lumber that cannot be bought at
cans, but 60,000,000 opportunities wide popular appeal.
He will in¬
any price do not make sense.
for free Americans to work and cur the
is
thoroughly
as
Hatch Heads Atom Group
the
President
committee
Truman's
for evaluation of the atomic bomb
tests,
whose
serve
Bikini Atoll in the
July
will
members
ob^
tests of the atomic bomb at
have
1,
Pacific about
selected
their;
as
Chairman Senator Carl A. Hatch,
New York Democrat. Vice Chair¬
according to Associated Press
man,
advices from Washington on May
3, will be Representative Andrew
S.
May, Democrat, also of New
York,
who
is
Chairman
of
the
,
great many domestic pro¬
posals which are clearly authori¬
tarian when
measured
by this
Although we have won the war
.yardstick of liberalism neverthe¬
less have wide popular support against Nazi tyranny and au¬
because their professed objectives thoritarianism, we have /by. no
means won the ideological fight
are appealing to
large groups. One
fqr liberalism as I define it, eithei
'Of these was the so-called full em¬
here in the United States, or in
ployment bill as it was originally
the world* That' will be no easy
proposed. Another is the current
fight. I know men who have de¬
proposal to extend the price con¬
trol act for another year "with¬ voted; their lives to public service
who today are discouraged, and
out crippling amendments."
fearful that democracy • cannot
V
As I have stated before, we
long survive the tremendous polit¬
.adopted many authoritarian con¬ ical
pressure and clamor of this
trols inc order to fight the warv
group and that group, demanding
price control was one of them. I that
government do this and that
supported it during the war* but and the other
thing for them, but
I recognized it as authoritarian
rejecting every effort of govern¬
rather than liberal. Price control
ment to
impose on them some
Was one of the devices by which
minimum ?t)bligationi pf^ citizen¬
the Nazis controlled the German
ship, The cry in political circles
•economy. Government power to
today seems to be special privi¬
fix prices is the power of life or
leges and benefits for all, and re¬
•death over every business, enter
sponsibility for" none. ;I do -pot
prise and is. clearly authoritarian
believe that is an accurate reflec¬
;In nature.
tion of tbe true sentiment of the
; Government attempts to control American people, I cannot believe
prices and > otherwise substitute it, because it it is, then the cause
^government edicts for the eco¬ of liberalism is indeed a hopeless
nomic laws which adjust supply
enmity of powerful vested
produce.
We seek here .at .home interests. He can hope for no re¬
and in the world a system under
ward except that he has, fought
which every individual' has an
the good fight for freedom.
opportunity to develop his own
If that great cry "Give me lib¬
individual capacities to the limit
House Military Affairs Committee.
Other members of the committee
same
erty or give me death!" still lives
free¬
in your heart and
dom for all other individuals.
There
is
no
path to that
easy
can
be
mind, then
you
liberal.
a
T.
Massachusetts
Compton
Institute
of
of
the.
Tech¬
nology; Dr. J. R. Oppenheimer, an
atomic scientist; Bradley Dewey
of Cambridge, Mass.; W. S. Newell
of Bath, Me.; Fred Searls, Jr., also
an
atomic /scientist;
S en a tor
Leverett
Saltonstall, Republican,
Massachusetts, and Representa¬
George W. Andrews, Demon
crat, of Alabama."
of
tive
Thb
/
compatible with the
Karl
are:
committee, which leaves for
the Pacific
next month, wilL re¬
its findings
port
President.
'
directly" to' the
1
1
Mem
t IF El N S UIl A.NC E
Bertrand J. Perry, Chairman of the Board
SPRINGFIELD
*
CO M P A N Y
MASSACHUSETTS
Alexander T. Maclean, President
,
.and demand in
nothing
new.
a
free economy are
along with
They,
subsidies
•consumer
which
are
■
canseffi!/;^
During Senate debate on the
Full
Employment
bill,
several
Senators asked on the floor in
•equally corruptive of a free econeffect, "What "does liberty mean
have been tried repeatedly to a man whose wife and children
:for thousands of years by gov¬ are
hungry?" Patrick Henry must
«omy,
ernments
which
afraid
were
to
rface economic realities,
turned
have
over
in
his
,
'
Wage stabilization of a sort dur¬
ing the war,
•cf
so that the violation
economic law by government
was not so violent. However, ra¬
tioning was abandoned nearly. a
•year ago, and the government de¬
liberately pushed wages upward.
'To promise to hold the price line
:|n view of these policies, regard¬
less of what Congress may do to
'the law, is an economic absurdity,
.and every honest economist in or
put of government knows it.
Some price increases are inev¬
itable. Whether they
mately
•depend
•OPA.
pre
occur
legiti¬
in a black market will
on what Congress does to
But price increases which
a
balance
petween supply and demand
uncontrolled
are
inflation. ; The
two elements which must be pres¬
ent to create a runaway inflation
—printing press money and lack
•of production—are not present in
the United States and there is
Teal danger of either..
^
Price control, like other
trols,
was
production
a /
is
wartime
con¬
measure,
close
now
no
to
or
clarion call to action
a
for all liberals.
It
time
is
1
for
the
liberals
of
America, those who believe in in¬
dividual human freedom and dig¬
tant
differences
which
have
<day
1941
or
levels
joften: divided, them in the past
politically, and to dose ranks and
fight for their, basic principles.
wait another year, or two
years or ten years.
a
Personally,
liberal, I believe in
omy.
a
free
as
econ¬
I think it is worth the risks
i'«
Annuities in force
» •.«
Gain
Paid
...
1.1
K)
*.-*
high..
»-•
»
«
•
■
$1,014,155,467
«-•
ci
it.
n
s
rat
.a
a
.....
.
a
82,570,654
,$
.
'.v/. A 42,279,068,780
4 '81,174,569
.
18,336,140
$
154,481,059
.$
5,609,799
Policyholders and Beneficiaries.*•?***»«:•..;... ..$
48,813,236
f
1,881,096
over
to
Claims
»
•_»
pat) «=•
December 31,1945
provide for annual income payments of. .$
2Nfew Life Insurance sold*
1944,..
paid, due to
.
.
rr.
ic*. «=»
r,
n
«* *»
13
^ar causes
Government Bonds owned and
par
.
«r»
«=•
**
«a» «ar«i>
• • . .
.
on
.......
........
*r* «r« . • •
•
ordeyai year-rend,
■
value.
.$ 286,000,000
Surplus to Policyholders, an all-time high.
Gain over previous year-end....
•2*
«3i
r|r
,
55,090,685
irt
13,804,652
'i'l I
Summary of Annual Statement
which still exist on the ex¬
treme political right, the chief of
which is economic monopoly. But
Assets
let's also face the clear fact that
December
the great threat to freedom today
is not from the political right, but
from the extreme political left.
Nazism
and Fascism
a
of
the Political
Bonds, Mortgages and Other Assets
Interest, due and accrued
$?92,985,587*!
izt
........
Product
Premiums, due and accrued.
*
A
significant fact, which many
forgot during our wartime
qo-operation
wi t h
Communist
Russia, is that both the fascist and
nazi dictatorships grew out of the
political left.
Mussolini was a
socialist.
In Germany, Hitler led
the National Socialist, party. Their
appeal was " primarily to those
people suffering economic priva¬
tions,
They won support by ex¬
travagant promises,.of economic
rewards, "if only all power were
of
31,5
::K1945 II
Left
«;«
8,159,752
....
13,010,128
^,.....
:m£'-
Total Admitted Assets
•
♦
»
*
• ,«=•
o
n
.r.
us
Liabilities
Policyholders' Reserve
Policyholders' Funds
.
over
concentration
camps
and
police, as necessary steps
road
ways
to
a
rosy
now.
as
the
To
end.
on
the
a
liberal,
Neither
on
as
the other
important
cap
be de¬
In passing, I might add that the structive of individual freedom.
#.t ...
*■
Taxes
►ri
.
tat
3,630,063
11,085,380
»
2,236,967
4,198,584
«,
Miscellaneous Liabilities.
1,800,000
Special Reserves ......
Special Surplus Funds. .........$ 4,650,000
Unassigned Funds.. v*.;<»,*»«>.;50,440,685
Total Liabilities and
1
^
Surplus to Policyholders
.
-
s)
55,090,685
Contingency Funds
United States
Registered Bonds included in the above statement
Massachusetts $250,000; State of Georgia $10,000.
.$1,014,155,467
as
required by law;
determined in accordance with rules established
Association of Insurance Commissioners.
v*''!!'
by the National
State of
"""Admitted Assets*'
are
deposited
>
are assets
utopia which al¬
to be in the distant
seems
future.
secret
$735,577,836
200,535,952
Policy Claims in process of settlement*......
Dividends to Policyholders..
to
hand, the means are
»=»
life Insurance in Force, an all-time
Gain during year
gers
involved and the way to achieve
it is to get rid of these controls
,
high
»r»
«
Liberals cannotoverlook the dan
turned
in
*-•
so
them.
nearly all
•civilian goods.
Communists
Of course, there
and fascists are
Will be some price increases and alike in their - devotion to the
some confusion when we
change
from a controlled economy to a proposition that "the end justifies
On that basis, they
free economy. That is inevitable the means."
Whether we make the change to- justify
lies, | cheating, I murder,
pbove
Admitted Assets, an all-time
Gain during year.
nity, to forget the ^little unimpor-
or
essential to achieve
not
question is
94th Annual Report as at
our
grave.
£uch at¬ That ; a ; Senator - of the United
tempts have always^ failed.
States can ask seriously such a
During the war, our govern¬
ment's price control policy was
^bolstered by a rationing program
which at least tended to adjust
•demand to supply. We also had
From
A
.This
complete Annual Report will be
sent on request.
statement is in accordance with the
State of New York Insurance
requirements of the
Department.
gtiftv--
■
v'. ;\;/////////;^
^HEgqmERCiM/ffcfftNaNCia^
(Continued from first page)
to
end!
an'
Interest
rates /are
lower today than they were when
,
.the war began—and this, in spite
of the fact that
Money ?
is important to; keep in mind when
we review the steps used' in this
country to keep cheap money dur¬
ing the wan There are some strik¬
ing points of similarity,
v/ (
did not take up.
As
a
to
banks
over
our
Treasury bor¬
200 billions of dollars
tries like Germany and Japan that
had small gold holdings, exactly
■
the
v
*
same
they
as
were
United; States and France
in
the
where
the gold holdings were relatively
'
!
high.
In England ihterest rates
declining since ■ that
Country left the gold standard in
1931, with little change in its gold
reserves* Clearly, I thought, there
must5 be- something more in the
/ way of an explanation of the low
/ interest
rates than
merely the
amount of gold reserves held in
the banking system;
'
)
fin an attempt to get some help
on the problem, I wrote a letter,
/ the pertinent part of which is giv¬
en below, to a rather large num¬
ber of the outstanding students of
banking in this country;
had / been
/
v
'
v
''For
time now,, I, have
some
been wondering about the adef quacy of the explanation that
'»j
f
f bur huge gold supply is mainly
-responsible for our low interest
states." In the first place, in
^
making a recent survey of bond
prices, I find that they seem to
be going up and reaching alltime
highs in countries that
have been denuded of their gold
supply quite the same as they
have
been
in
this
country
where we have an excess supply
of gold.
For instance, Govern¬
ment bond prices in Germany
and Japan are at practically alltime highs.
Likewise, GoVern■
ment * bonds in England have
moved up sharply during the
last
two
years;
And, while
they are not at all-time highs, it
is interesting to note that they
are higher today than when that
country was on the gold stand¬
'
-
"'
•
;
-
ard."
'
-
In rereading the replies to this
a : few
days ago, I was
amazed at the lack of unanimity
1
>
letter-
in their answers.
it
now seems
it
even
But One
writer,
to" me, saw
the prob¬
lem clearly and fully understood
before the war,
"Interest rates are low," he said,
"because bank reserves are re¬
\
dundant.
They
>
are
the United States
They
redundant, in
on a
gold basis.
also kept redundant in
countries like Germany without a
are
gold basis.
It doesn't make any
difference at all," he went on to
State, "about the amount of gold
reserves, so long as confidence in
the currency
is not impaired.
Money is cheap in this country
because bank reserves are redun¬
dant on a gold basis, and business
does not expand sufficient to use
them up. Money is cheap in Ger¬
many because
bank
reserves
are
kept ample, although on a paper
basis. Germany's currency is di¬
vorced
from
the
international
money market through export and
import controls and through
strictions
re¬
the
purchase
of
exchange.
Prices
and
Wages are kept under control by
law, strictly enforced, and infla¬
tion is kept down, while no- one
is
permitted
to
raise
capital
through the sale of securities
foreign
-on
~
without
consent
of
the
govern¬
ment."
He closed his letter by saying
interest rates in a country
that
of about
that
methods?
There is
no
doubt
Government
enough'bank credit and money
be put into the market in,,
If
,
order
maintain
to
low
interest
inflationary priced
learned^hqw/toA^gulate/thq yolf rise begins, the present British.,
nme/of/banlc reserves so/that our Government is'prepared to con-"
commercial, banks can always ab¬ tinue price control and rationing *
our
banking authorities have
rates so that an
sorb- the amount of Government indefinitely.
* 1 ' *
; ^
securities* which investors them
Moreover, the British see clearly;
selves may not be disposed to hold
the/ difference1 between;;/cheap/
in the days ahead at the prevail¬
inonjey and cheap capital;/ Her|:fi-;
ing rate of interest. For all prac¬ nancial experts
realize, and have-,,
tical purposes, any mathematical
openly stated, that; Britain has af
calculation
about the
limits, to shortage of capital, i One of the'/
which our banking system can go
Well known; British writers; on,
to support the Government bond
banking and finance, F. Bradshaw;
levy
market is futile and fails to
entire cost1 of a
policies that are wholly unneces¬ Government bonds at the interest
rates at which they were offered.
sary and even dangerous to follow
in times of peace. It is important, The- Federal Reserve Banks!saw
therefore^ and* very important in¬ thatvtheMhe Member/ banks;; had
deed, that we understand just ex¬ the resources; toMiy: them imsueh
actly bow the government* was amounts as were necessary to
able to finance such a large part of put the ,bond drives across.
The
the cost of the war through bor¬ situation* Was* so* tied, up^thaLthe
rowing without increasing interest Treasury had nothing to worry
rates.
It is this lack of under¬ nbout: ' It
could be certain of
standing that is responsible in no getting all the money it wanted,
and on its own terms as to in¬
small degree for the belief that
the government, witb gain to all, terest rates. It might have to bor¬
row for short periods of time from
can indefinitely in the future so
control interest rates, that they banks'/ on ..-bills)i notes,/ or certify
will always remain low.
icates, rather than from investors
on' long term bonds, but as this
Analysis of War Financing Effects gave the-Treasury its money at
In tlie discussion that follows it the lowest possible cost, probably
is proposed/to;-show/(I) just how it didn't worry too much about
it was possible to finance the war this phase of the matter.
Was it not inevitable' that, with
with declining interest rates, (2)
what the effects of that financing the banking system so manipu¬
have been upomoup present'credit lated! durm^ the war and with
and/ price
situation,
and
(3) our industrial ■„ activity so conwhether in the interest* of con¬ troled byr war; demands,, money
tinuing the present low structure wouldremain /cheap? //It /could
of interest rates,-it is safe in the hardly have done otherwise.
days immediately ahead to con¬
There is grave danger that the
tinue the* same credit policies; that
real
implications
of
the
way
were/pursued during;the>war; r // money was-kept cheap during the
may.
has to
same
But it is not
.
they
prices at the/
level desired by the
kept cheap in the future by these
$1,-
sufficient taxes to pay the few new offerings of corporate
war; Some part bonds or stocks, or of real estate
has always been paid through in¬ mortgages, to compete;with Gov*
bonds
for
investors1
flation; "Moreover it must be eminent
remembered that special require¬ funds,, and on; the- other* hand,
ments imposed by war demands investors showed an unwillingness
may; i make iWeeessary
banking to • buy the- requisite amount ;of
need to support bond
prehend
the
the
real
problem./
com¬
inwardness
a;
// '
of
Makin,, in
National
an
article in "Barron's
Business
and
Financial,
/ %'/
Weekly" of June 18, 1945, stated/
Eccles,
Chairman of the Board! Of; Gov¬
that Great Britain's chief problem,
in: the: postrwar period/would ber
r
The
Hon.
:
Marriner
S.
of
the
Federal
Reserve how: to finance reconversion
and/*
System, forthright as always in his rehabilitation with her great de-.'
statements, let the cat out of the ficiency of physical capital, that is,)
bag in testifying, before a Con¬ plant and materials, and at the,
gressional Committee on Banking same time keep cheap money. The!
and Currency about a year ago London. "Economist"
has run a,
ernors
when; the question/of* reducing the
series
minimum
during the past two
reserves
required of the
Federal Reserve Banks
was
before
of
articles
this
on
years.
subject'/
In Mr,^
Makin's discussion he recognized;
that the Reserve Banks should not
that there would not be enough
capital to meet all the legitimate
demands in England.
He posedt
the question how to apportion this
available supply,
Should it be
through the price system? To do:
this, he argued, would mean a
be
free interest rate and
Congress for; consideration^/; He
said'at that time in substance, that
it was foolish for Congress to pass
law requiring the Reserve
Ranks?- to maintain, minimum® re*
any
serves
against their deposits, and
compelled
amounts
to
keep definite
required reserves at
of
all.
What then
to the
eral
should be the
limit
possible expansion of Fed¬
Reserve Bank credit, if it is
not to be
central
gold reserves?
banks
Can the
constantly expand
their credit base by buying Gov¬
ernment securities with the aim
the end of
cheap money.
He advocated and,
of course, the present British Gov¬
ernment
having
mittee,
is
following the policy,
Capital Issues Com¬
and before any business!
a
can raise
capital through an issue
of securities in the money market,
it must first get the approval of
this
Committee.
If
Dr.
Schachf
securing ever-and-ever cheaper
money until the rate of interest
could get his mind off his present^
worries at Nuremberg and could1
has been
know what was going on in Great/
of
completely abolished, as
Keynes maintained that it
Lord
could be?
In brief, what is
this
Britain, he no doubt would get''
pleasure at'seeingdhe degree'
some
to which that country, the original;
so-called
"technique. of cheap
overlooked./ The
money" that can be used to keep home of the free enterprise sys¬
or less automatic
interest rates permanently low if tem, was beginning to follow his!
particular after Pearl Harbor, our money
by the Federal
methods .of financing the Thirdf
the/ Government / wants to - keep
Government, was -soon borrowing Reserve authorities was, in prin¬
Reich.
them so?,
huge"tsums, of*money.. War bond ciple, dictated not because it was
A;/!/"'/*////
Controls and Cheap; Money
drives in amounts that would have essential to finance the war in
*
Keynes-"Vanishing Interest"
been considered: fantastic a few this manner, but because it was
Is it not a fair question to askTheory
years ago were put on about every absolutely essential to have these
of; ever-cheaper**
Lord Keynes in his epoch-mak¬ the; advocates
three^months.] Roughly, about 60% excess reserves created if the war
ing book, "The General Theory of money if they are prepared to pay
of the bonds purchased in these was to be financed, without aban¬
in the way of controls over ourEmployment, Interest and Money,"
drives were bought by individuals doning cheap money. : A larger
economic life what will be neces-*
published in 1935, first worked out
and savings-institutions. The other part of the Treasury deficit could
this technique in detail.
In es¬ saryftMinsur&;thi£ cheapvindney?^
40%- was bought by our banking have/beefl<finaneed by the pub¬
sence, it is very simple.
It rests And, in the ihterest of frankness^
systenit^ This/huge/^pansion/ of lic? instead! of by the banks if
and
honesty, should they noff
upon two main assumptions: First;
bank credit, resulting from this only interest rates had been al¬
that the central bahks will always bpenlytellthe h^plb Whaftthese^
purchase of Government securi- lowed to rise,/ because rising in¬
controls,are likely to-be,,evenstand ready to furnish the member
as-f I
ties, in a- short time- used/up the terest rates would have made the
do our British cousins?; Some- i
excess
reserves
of the member public more willing to buy Gov¬ banks/ alb the/ reserves1 that the times if
Would: seem as though thef |
member banks need' no /matter
banks which had been built up by ernment bonds and less desirous
how higb their deposits rise, and benefits of cheap - money are held!
the huge gold imports of the 30's. of holding such a large proportion
before us as though they could be'
irrespective of how much- cash
The very rapid increase in cur¬ of its savings in cash and bank
had- without any cost, and that*
the people want to keep.
Or, to
rency in circulation also augment¬ deposits on which it received no
through some mysterious legerde-*
ed the .problem, .so that By the end income, whatsoever.'. To
deny put it; another way, the central
banks must always stand ready to main our banking authorities* have,
of 1942 the Federal Reserve Banks this,; as some writers apparently
worked' but a/technique* to bring/
buy and sell at stated prices Gov¬
had to begin to build, up reserves do,, seems, silly and contrary to
/
ernment bonds of all: maturities. this about:
"
in the Member banks through put¬ reason.
;
It should be apparent that there'
This,; „• of; courjse,^ would?/ fixf the
ting,their own funds in the money / (Certainly)/ the public did not
price at which Government bonds is nothing mysterious about' the
market, principally, of course, by need for any legitimate business
would sell/ ./The other assumption technique of cheap money and it:
buying
Government/ /securities, purposes to carry over $25 bil¬
is, that such action can be taken also should be apparent what the
mainly bills and certificates. Trac¬ lions of cash in its pockets or in
by the central banks without caus¬ limits/pf;the Goverrimbnt/'are/ift
ing the growth of Federal Reserve itsi-cash registers during the war.
ing a price inflation. Should prices it attempts to make money cheap,,
Bank holdings of' Government' se¬ And, certainly, there is no need
start to get out of hand, they must- should the economic forces- of the
curities through the war, we find today, nor was there during the
be
be arbitrarily controlled; The Brit¬ nation
making / for
dearer,
they, did noti begin to expand war, for individuals to carry over
ish/recognize this clearly. / The money. The technique is nothing)
rapidly until the. latter part of S42 billions in their checking ac¬ London
but an evet-creation of more and
"Economist," in its Octo¬
These redundant liquid
1942, and then 'the" expansion con-, counts.
ber 6, 1945 issue, page 493, states: more bank reserves by the Fed-*
tinued
rapidly
throughout the assets on the part of individuals,
"Two factors are capable oh induc¬ era! Reserve Banks with the result*
war
until
such / holdings were which are certainly a potential
that an ever, and ever larger in¬
threat' to our price structure, are ing a- change in the interest, rate,
about 22 billions o^ dollars. - •
the public though it is not certain-that they crease takes place in bank deposits)
The Treasury .was/able; during maintained} because
The first is the risk of and bank cash, that the liquid re-!
the war to: floa$ it$ huge bond is¬ does not think it worthwhile to will.
a
pronounced inflationary outr sources of individuals become ever..
sues without- raising interest rates
buy any of the securities offered
break' which
might! encourage and ever larger,, and with the,,
primarily because'the Federal; Re¬ by* the Treasury.
holders to off-load their securities. result thatl the dangers of infla^'.
serve Banks furnished, the mem¬
We may- summarize by saying
The second is the - slackening of tlon become greater and; greater,!
ber banks with- sufficient reserves that
cheap money was main¬
The extent to,» which, the. Federal!
so that the member banks could
tained during., ther war* by three wartime, controls, ; financial; and
These must be main¬ Reserve Ranks can go,..therefore,,
buy the amount* of bonds the methods. First, Federal Reserve physical.
'
in supporting .the present prices of
Treasury allotted to them., To; the Bank action in supplying mem¬ tained:"
Great Britain intends?, to/pursue
extent that the Government could' ber/banks with air the reserves
Government bonds and in. main-.
its cheap money policy and keep
not finance, its .war; expenditure
they needed.' Second, Government
taining the present structure of
out of' taxation and loans f torn the control of industrial activity and interest rates, low* and, it. openly
states that/it is prepared; to pay 16w interest rates, will, in thepublic, it had to do so through the OPA control of
With the beginning of our, re¬
armament program in 1940, and
in
war
will" be
process
of more
creation
*
4
.
.
can be kept low, with or without
gold, if a country is prepared: to
prices. And, third,
pay the price
in the way of banking system: And' the Federal persuasion and propaganda cam¬ the price* necessary* to bring- this
The • Government'
has
arbitrary controls over its life. Reserve Banks were very careful paigns which were successful to about
This brief explanation of the way to see that the member banks had a remarkable degree, and still are taken/ oven the Bank of; England*
Germany kept money cheap when the requisite cash reserves to buy successful, in getting people to This institution is now completely
she was'rearming before the war the necessary bonds the public save a large portion of their cash under the control" of the Govern¬
ment and' will, stand, ready to fur¬
nish the other banks of England/
The question we are now con¬
fronted with is;! Can money be
stocks
banks was necessary,
//
; i*/
And yet, one day when making a faced with financing an all-out1
The Treasury set the interest
war
which no one knew how
survey of interest rates in the
curve at % % for 90-day bills
up
principal countries of the world, long would last' nor how many
to 2ya% for long-term bonds. On
I found much to my surprise that untold millions of dollars it would
cost. No nation has ever able to the/one; hand; there; were very
interest rates were low in coun-
f
to
goods* r
with the loanable funds
keep excess reserves in
member
attempt
consumer
Can Money Be Kept Cheap?
matter of
fact, the Federal Reserve Banks
tried
the
not
spqrid; them for
000,000,000. When the excess re¬
the'purpose of this serves declinedv much below/ this
to finance it. What is the explana¬ paper to - find fault with, the way figure, in one way or another the
tion for this strange anomaly?
the war was. financed. In any dis¬ Federal Reserve Banks took the
cussion of ideal- methods of financ¬ initiative and put some of their
was a common
explanation
before the war to say that low in¬ ing, the war, the magnitude, of the own funds in the market and built
them, up again. - Little rediscountterest rates in this country were task that, confronted the Treasury
ing on the part of the member
due to our huge
of gold. must not be forgotten. 1; It was
rowed
and
resources-
What Price Cheap
.
final analysis,. depend upon how'
long they can continue tb pump
their credit into the. money mar¬
ket: and
increase
currency
arid
Volume 163
-\.V,.•
-vy.;:-;.v
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4490
•"•
777'77t<
v
l'v/•;:,'"
deposits without bringing on funds in;;, the market without it
inflationary price rise. -; // being interfered with by the Gov¬
Without any further increase in ernment. At a time like this when
the« amount' of bank deposits, we no one really knows what the real
bank
-an
[are today faced* with the serious
[ problem of how long such huge
liquid
resources
as
are
held
now
is,'
individuals can remain ' idle# ing the' war, and in fact, even at
.[According to the. Securities and the present time, there have been
(Exchange Commission there was so many interferences with nor?
an increase of $37 billions in these mal markets that dollars have^be?
come unspendable in many fields,
} liquid
resources of individuals in
-1945. • The total increase in these For instance, wjiat does the ceil-*
J resources since the beginning of ing price of 55 cents per pound
[ the war production program in the of butter mean to the price level]
-middle of 1940 is $157 billions# when there is ho/ butter to be
For a Government ta gaihble^'that bought? Who knows what a shirt
,
:
-
will
resources
be
held off
or a
of
goods to match
price increase is
J
Speculative Fever Increasing
,
what houses
are
worth
ceiling prices
average house
because there are no
sells
today
the
and
them
on
-:
'^approximately
for
twice what it sold- for in 1940i
■
Ih
are signs that thd
speculative fever is increasing and
other words, the value of a dollar
for' houses- today is £ exactly one*
that people are
desirous of spend"
half
..ing these savings. • Consumers' expenditures for the first quarter
; of
this year were $20 , billions
war
~
*
Already there
.
-
*
f
.
'
i
higher than for the first quarter
of last year,
Commodity prices
have risen 5 % in a year and are
still rising.
The Department of
Agriculture reports? that the general level of prices received - by
points
during the month ending April 15,
i reaching the highest level since
i
July, 1920, which was before the
4 outbreak after the last war. Stock
/ prices certainly are not low/ The
1 velocity of bank deposits is ini creasing.
Prices in the real estate
r
'
r
market
.
4
t
_
ter
it
were
there is
a
aghast at the way money
around, 'Certainly,
thrown
no
lack of symptoms that
speculative spirit is abroad.
Wisdom of Continuing Low
Interest Policy
*
In
1
an
economic situation such
this, would it be a policy of
wisdom for bur banking authorities to attempt to maintain a strucas
ture
of
interest rates
so
low
as
•"*
the
before
was
began.
:■'
price, cheap money!
If
the price of low interest rates is
increasing the monetary supply so
that there is a danger of a rapid
What
forget that, in the absence of
hoarding money, production cre¬
to
Govern¬
cents
an
ias not
another
creases
for
demand
ing
in wages to meet the ris¬
to
blame
just
labor
it is
as
blame
for
management
to
of
blame
it
power was
than' there
to
this
for
futile
absorb
were
benefit from
to
the
the
purchasing
people
sition
restraint
in
fenses werO muen more
are
eairlier
stage and because ; our previous
experience enabled them to be
perfected rapidly,
The major de-
[qomprei;
hensive than in 1918.
suffering a sales tax of approxi¬
mately 40%.
And they will suf¬
fer this sales tax just as long as
They com¬
prise high taxation (but probably
I have said,
ical controls, rationing and pricecontrol.
As; a purely theoretical
they live unless,
incomes
as
can
increased
be
the
that
not on
a
broad
enough base), phys¬
prices proposition, comparable defenses
would probably hold inflation in
check in the days ahead.
Can Government Control Interest
Rates Indefinitely?
But to
that the existing defenses
will be effective in practice should
The Treasury has boasted of ife bank credit continue to expand in
marvelous record of financing the Order to support a* cheap money
war with a steadily declining in* policy is naive.
They depend ab¬
; terest rate.
The cheap money ad¬ solutely upon the sanction of pub¬
vocates have said, and are
still lic opinion, arid public opinion
saying, that this proves the Gov¬ will not support them at this time
GPA is on its
ernment can control the interest in this country.
indefinitely in the future,
submit, however, that it remains
to be seen what the real cost of
rate
suppose
way out. If the upward, movement
of prices is to- be controlled now,
it must be through the control of
they are at present by putting out
the? monetary and credit supply
our war financing is going to be.
more
money and bank credit in
and
through
preventing
costs
[* the country when the country's The story has not all been written
to date. The evidence i& far f^om from further increasing, particu¬
} monetary supply is already redundant?
Our bank deposits are all in. It will be some years before larly wage'costs#
Moreover, the danger inherent
The low interest rate^ it is
more than twice what they were it is.
in our huge liquid resources must
; a decade ago; our currency sup- clear,; was made?: possible only by
be made apparent to all. Any at¬
the
Government; relying
very
\piy, over four times' what it was.
tempt- to cash' any large portion
Has there been any increase in heavily indeed upon the comtner
of War Savings bonds would be
/ production, retail sales, or factory cial banks and the Federal: Re¬
disastrous; The only circumstances
serve Banks as, an outlet for its
payrolls that necessitate such an
Whether
the increased in which past sayings can be spent
[ increase?
Is there any serious bonds.
without inflationary consequences
student of finatico who denies the amount of purchasing power now
is when there" are some spare re¬
inflation potential of this huge in the hands of the people result¬
monetary supply? To augment it ing from this method of financing
*
"
*
f
.
[ in the interest of cheaper money
/ at the
present time, is assuming a
grave risk for a small gain,
*?
I
do*
/. stood as
not
want
to
be
making any plea for high
[ [ interest rates.
/
*
ing
I am merely
iriak-
plea that the interest rate
allowed to find
its
on our
own
level
have
not
so-called
to
believe
This advertisement is niither
seen.
The desperate cries being
the part of the cheap money
apologists for the continuance of
OPA indicates at least sortie fear
in
their
minds
that
trouble
;. ■
•-/.v
-■!■[
in any arbitrary ratio of ex¬
change between money and trade
see the
danger in the present
excess money supply.
Those who
ger
increases will" be
as
to
dis¬
It must never be; stocks are now below 3% and the
forgotten that costs determine the ^averages are at a point reached
floor of prices.
only in two other years of our
Chester Bowles tell us that the whole
history. I have already
,
to handle the present price .mentioned the rising cost of living
situation is tn renew OPA and and the fantastic:
prices of real
keep price control until produc¬ estate.
tion has had time to catch up with ;
With this economic situation as
demand-. This: is no place to dis- a background, the advocates of
cuss the pros and cons of his con¬
cheap money must face the fol¬
tention.
Suffice^it to say, that lowing question: If to prevent the
perhaps something'could be said present, abnormal low scale of in- ;
for it (but ribt
riuieh) if one terest rates from rising, credit poliwere certainvthat the'^continuance : cies that add to the?
present dan¬
way
,
,
OPA
of
did
notorestrict. the: in¬ gers of inflation must be pursued,
production, which is so ;is not [that too high a price to pay
vitally needed. Moreover, there is for, cheap money? 4
in
crease
an
offer to felt nor a Solicitation of ojftrst to buy: any of these securities'.
offering is made only by the Prospectus.
>
\
7/.///v:. ./■; .7
V-S
■./. ■
■
'•
I';:'-'.'"' -.7; 7
'r4//:7///4^
is
■
v.-.'
: -7-
77'.:
■
' •;
50,000 Shares*
ahead;
Peerless
Casualty Company
Common Stock
Par Value $5.00 per
Share
♦Of tlie above mentioned 50,000 shares 24,851 shares were
purchased by the- holders. ;o£ the company's? common'
Manufacturing Co
stock under the terms described in the prospectus*,
COMMON STOCK
'
'
$1 PAR VALUE
Price $14.00 per
Sltare
Price $3 per, Share
Copies ofthe Prospectus maybe obtainedfrom such of the undersigned, as may legally
offer these Securities' in compliance with thesecurities laws ofthe respective slates.
F. H. ROLLER &
>\r-S'
COMPANY, INC
New York,
N.J Y.
J
|§§ Herrick, Waddell
/
v
May 10, 1946,
/
•/
iv.'
dan¬
unit cost basis.
NEW ISSUE
Brandt-Warner
or no
in it are gambling on the as¬
sumption that its owners will let
it stay idle and that its velocity
will be low even as it was during
the depression of the 30's. It seems
if, owing to the end of over¬ to me that that gamble today - is
time, they do not lead to higher exceedingly dangerous.
Already
earnings, or even if the additional Series E War Savings Bonds are
earnings are saved,; because the being eashed faster than new sales
floor of all prices* whether con-r are being made.
With our present
trolled* or not, must be geared to scarce supply of consumer goods,
costs which,, in turn, mainly de¬ with our increasing demands for
pend! on wage rates.:
Price in¬ higher
wages,
and
with -j. the
creases induced by wage conces¬
growth of speculative sentiment
sions in some directions will at in the country, the price situation
once lead to
demands for higher certainly is filled with explosive
The only credit policy
wages elsewhere. The process will .elements.
become cumulative.
In fact; it that can be followed today with
already has become so.
The line .safety is to take such steps as'
must be held at the 18 Vfe cents pet may be necessary to draw off the
hour
increase
given the steel :excess, money; supply in some form
workers if the price situation is where it will do the least harm
not to get out of hand.
And too to our whole economic structure.
much reliance must not be placed Certainly, this supply should not
upon the possibility that increased; be increased.^ So much of it has
production will automatically already gone into the stock mar¬
right! everything and? keep prices ket that in spite of the fact that
from going up* When the increased no longer is it permissible to loan
production comes on^ the market, a dollar to aid stock speculation,
it is going to be on the higher- yet the yields on many common
Nefw'Is$uq;::4£4/^^
100,000 Shares
the
or
feel that there is little
The
made
on
in
quantity theory of money
price structure in the days
ahead remains to be
Already our cost of living
in the market throughthe free is;. up by about 40%/when deteri¬
play of. supply, and^ Semand fbf oration of quality - of goodE: jpurbe
'
a
Higher Wages
will take its eventual revenge up¬
under-
interest rates as such or for low
for
even
last because the technical defenses
much
price level, should the: people de¬
cide to spend it for goods?
One
permanently
gradually.
ruptive as an attempt to spend
rapidly the monetary savings re¬
sulting from the war. Increase in
wage rates will force up- prices
Effect of Public Confidence
a
an
for wage
spending
ball rolling upward.
The
problem today is to see that it
doesn't get rolling- too rapidly.
at
power
higher wages to meet
rising living costs. At; this stage;
any
further substantial pressure
crease
erected
or more
up- this
excess purchasing
and keep it from having
inflationary effect upon the
mop
tran¬
the drive for
this purchasing power, enough of
it was spent to> start the price in¬
were
Of liquid
outstanding at the pres¬
ent time; is it not difficult to see
how a; revival of production can
does
Drive
art
creased since the war began
is far too much.
period
>
With the huge amount
resources
Another serious danger present
in the current price situation is
goods
price level, the price
To a man living
on a fixed income; a 10% increase
in prices is exactly the same as a
10% sales tax each and every
year;
Individuals who haye/ not
been able to get their incomes in¬
rise in the
for price increases.
is to spend them very
power.
showed
Giv¬
credit to
the
power
Funda¬
mentally,
OPA • authorities
are
only treating symptoms. They ate
not grappling with the real causes
public into
them—in
purchasing
very
that is necessary to buy it.
great wartime
savings can ever spent quickly.
The only chance of deriving full
market.
consumer
the
large fallacy in Mr. Bowies'
because he seems to
the
ates
the
in
seen
cheaper
mislead
to
all, more purchasing
created during the war
Although our
admirable
for
or
the black
be
thinking that its
increase
labor
and
more
take
It is futile for management
,
can
buy houses today before new ones
are
built is only driving up the
prices- of existing ones to fantastic
heights. 7 It Would be a great mis¬
ing costs of living brought about)
by a previous wage increase and
originally instigated by the infla¬
tionary methods of financing the
Government's deficit during the
war.
-This
present market for houses;
in¬
further
spending
tion.
very
argument
of current- income,
then the additional spending of
past savings merely creates infla¬
Inflation to date from this war
has been mueh/les^than in the
their
are
*
*
what
anyone
was
/
'
of
competely out of hand,
who spent even a by the amount
short vacation in Florida last win- have gone up;
4 and
i
three
advanced
farmers
the
Back
supply
without
"
t
of
today
cient
them
playing with fire, indeed.,- * *
a
OPA
not be found?
a
the
sources
to spend them
on.?
If
everybody is already employed by
suit is worth, when one* can-*
We get some idea
the market until there is a suffi'
of
added
price index.
The full force
the general increase of I8V2
hour in our wage rates
yet been felt in the retail
When it- is felt,
certainly this is no time to in¬ price structure.
I confidently predict there will be
crease the amouht of dollars. Dur-<
dollar
of the American
value
:"l by
.these
is
chased
ment
•
'
.
7'
V ;
I Geyer &
& Co., Inc.
"" *;
•••...
;v-
•"#
'
i
'
Co.
Incorporated
.'V"4^7
THE COMMERCIAL & FINANCIAL CHRONICLE
2676
Thursday, May 16, 1940
tional
The Americas in
has
(Continued from page 2642)
being tested of whom some
were
found wanting, • above all,
that economic problems had out¬
were
-
political solution so that
was
everywhere—recall
their
run
unrest r
projection of
these, make a global
a
them, and you will have invoked
S a
realistic
mental
background
against which today's internation¬
al problems can best be analyzed.
Whether or not the future will re¬
veal world-wide progress as great
&s
that which the United States
achieved in its period of crucial
depends much more than
test
is
generally recognized on the wis¬
dom, the courage and the patience
demonstrates during
this country
.the coming few years.
problems divide
generally into four
•'•"'area
classifications, the' United
States itself, Latin America, Eu¬
,
' Our
external
I! themselves
•
and the Far East, but there
inter-relation of cause and
rope
is
an
for exclusive
f *>ut any one of them
Because of your spe-
discussion.
in
interest
oar
af¬
hemisphere
will comment
I
fairs,
groupings
diffipult to single
it
makes
that
these
between
effect
Inter-
on
American considerations first,
but
will note that in order to
ob¬
you
tain
a
perspective it will
to follow threads of
proper
be necessary
development
Our Influence
into
uncover
we
each of the other
areas
as
well.
in Latin America
exaggeration to say that
influence in Latin America
our
lias suffered marked
deterioration
in the months since
;
the war end¬
prestige
During the
Some decline in our
ed.
expected.
be
to
was
war we
purchased the products of
in
tremendous
America
Latin
quantities, and encouraged evergreater production there. It was
inevitable that a reduction of im¬
ports to peace-time levels
would
repercussions on the econo¬
of the producing countries,
ihave
mies
though
dislocations
the
so
-
far
than many feared.
these com¬
modities in amounts adequate to
have been less
order
In
to
acquire
meet the vast demands of war, we
commitments
which some
disagreement
already has
oc¬
curred, and more is in prospect. In
made
post-war
direct and
implied,
on
sometimes frenzied and zeal¬
our
politi¬
ous
efforts to gain wartime
cal
cooperation, we also lavished
Presidency
nature, it would not be illogica
for him to seek a working arrange¬
election which for its
freedom and orderliness signifies
through
an
an
ment with the more
elements of the
important advance in Latin
politics. It is too early
determine with any degree of
American
to
the
assurance
that the
course
Brazilian^ government
will
President
new
welcome
to
has
extended
capital
foreign
to end Argentina's politica
isolation, and seek dominance in
Latin American affairs. Soon after
his election he boasted that his in¬
fluence
and
and
promises < their
rights will be respected. As else¬
where, one of the greatest prob¬
lems he faces is inflation, which
has reached a high level in Brazil
Fortunately there is every indica¬
tion that the new government in¬
tends to rely upon orthodox econ¬
omic methods to work out its
than
Peron's
in
tions.
■
Cir¬
from Cuba's "sugar boom"
likely to continue for some time
due to the world scarcity of tha
product—through relative politi¬
cal and economic stability, such
as
may
be found in Peru anc
Colombia, and on to the enigma
that Argentina has become, at the
vary
characterize
our
to
re¬
the
interim
new
course
required by changing
times and conditions.
Unlike
most
of
the
other
re¬
gions of the world, Latin America
finds
itself in an exceptionally
favorable trade position. Our war¬
time purchases there and those of
Allies led to the accumulation
our
responsive
being served with large orders
crow are little cal¬
culated to inspire confidence that
our
good relations with Latin
diplomatic
of
unimpaired.
America have been
There
indications, though
are
evidence
direct
no
of
which
I
Peron's
forced
business
on
other
concessions
this
country
to
in
through
bidding,
United
and
Peron
numerous
was
visited him
Aires, coming from
nearby Montevideo, and suggest¬
ing a resumption of * diplomatic
and trade relations long inter¬
recent
delegation
rupted between the two countries.
long as they served
immediate political ends.
At the
same time the army was kept in
line by huge
outlays of public
funds
on
a
military
program
whichr seems
strangely out
of
so
The
speeches
Latin
throughout
Mexico's
radical labor leader, Senor Toledano, constantly stressed the de¬
sirability of closer relations with
Russia, evoking considerable en¬
America
in today's world. \ The in¬
flationary character of Argen¬
tine government fiscal policies, in
place
a
Immediate 1 y
elected in Argentina,
Buenos
in
of small importance
measures was
than
America
States.
Soviet
a
employees
years.
The economic soundness of these
to Peron
Latin
in
Hardly a day passes
that the leader: of the powerful
Communist party in Brazil, Senhor Prestes,
does not make a
statement
derogatory
to
the
government, ever
to
thusiasm
of
recently
in countries whose pro¬
portion is large of the so-called
"underprivileged." Returning tra¬
velers report the recent arrival of
delegations of Soviet officials of
impressive size in every country
south of
the Rio Grande, and
period of scarcity of goods of
all
kinds, is having serious reper¬
cussions in spite of the country's
favorable foreign exchange posi¬
tion.
Reaching the limit of its
legal borrowing power, , the re¬
gime has now taken over the
close observers detect
a
new
ten¬
dency toward truculence in In¬
foreign exchange
ter-American negotiations which
Central Bank, enabling it to con¬
balances, because imports had to
is too general to be entirely spon¬
tinue to issue money by adminis¬
be restricted sharply, due both to
taneous.
Speculation
increases
trative fiat.
the scarcity of goods and the un¬
that
all of these developments
availability of shipping. One ad¬
Peron's Election in Argentina
may be part of a larger plan to
verse effect has been to produce
continue
the turmoil
that
has
It is well to remember,
inflation throughout the rest of
plagued the world ever since Rus¬
the hemisphere, in some places of ever, that Colonel Peron now be¬
sia began to take an interest in
comes
a
constitutional President
fantastic proportions. Living costs
for a term of six years, and will external affairs in the late thirhave soared, resulting in serious
;ies, and which encourages a pono longer be considered a
usurper
unrest in the low-earning farm
itical atmosphere in which sub¬
who rules by military threat. As
and urban populations, and lead¬
version thrives. '
a
consequence he must consider
ing to governmental changes, not
of
large
local
is
adventure in statecraft that
an
itself
is little likely to commend
citizens of a country like
the
which has decided
preference for private enterprise.
to
advanced
reasons
for
com¬
munity control of raw cotton mar¬
all
of
them
favorable
from
our
viewpoint.
The Situation in Brazil
Brazil, the Vargas dictator¬
ship has been overturned and a
military figure, General Dutra,
In
his
political
from
a
Though
position
long
he
range
is
and
future
viewpoint.
committed
by
election promises to sweeping so¬
cial reforms and benefits for la¬
bor,
and
adopt
in
all
probability will
some measures of a radical
%
..x
•
if
$ 1
.'•■•
,,
'•.•'
In
Socialization
another
Plans
address, before the
will—that vour
we
to
as
considerable
a
num¬
great frequency and bitterness
abroad, and particularly in Latin
as
America,
Britain
United
feel
as
as
in
those
are
of
States.
And
certain
are
in
correct
of
the
deeply that they
as
we
Great
sections
some
we
the
British
are
right
have
been
international de¬
■-"v'v•:'•-;'••■■•'v>'.
;' - - <
our
portment.
A
Formula
World
for
Economic
11
.
'!
Stability
My formula for an economic ap¬
proach to
world stability has
three phases which I shall outline
briefly. •
The first is notice to all of ouf
allies^ that we intend to sign
mercial treaties
former
com¬
with each of
enemies
and
the
our
states
they dominated, pending the set¬
tlement
of
formal
other
and
issues
possibly
in
more
protracted
all of the
negotiations between
participants in the late hostilities.
The
world, including the United
States, urgently needs to get back
to work, not only to distract men's
minds
from their misery; but to
begin the restoration of wealth
squandered during the war, - and
to dispel the spectre of hunger.
,
These commercial treaties should
provide for the maintenance in¬
valid, and it is to be hoped that
better judgment will prevail be¬
definitely, or until world political
stability is achieved, of as large a
body of our occupation troops as
may
be
necessary
to
insure
fore it is too late.
What is important
for
to re¬
us
member in this connection is that
eration—compensation to owners
will be in sterling, not dollars,
been
there have
no
indica¬
printing presses in Lon¬
don, will not be able to produce
the currency or the debentures
required.
The
loan agreement
now under debate in Congress is
designed to enable Britain, with¬
out endangering too greatly her
own economy, to cooperate with
us in establishing conditions for a
resumption of world trade Which
will
permit the war-expanded
industries of both nations to em¬
ploy their full capacities, Fre¬
quently
I
have
been
asked
whether I think
the proposed
will
advance
is
answer
an
be
repaid.
My
unequivocal "yes"
provided weproceedmnsweiwihgly and with determination in the
indicated
direction
in
trade
the
proposals, which I believe are the
most important part of the agree¬
ment. If we falter, or are turned
aside by selfish political consider¬
ations, the fact that the advance
may not be repaid will be of little
consequence in the world eco¬
nomic crisis that probably will de¬
velop.
I hope I will not seem presump¬
if
tuous
I
comment
offer
one
additional
continue
the
to
enlist
have
should
suggest,
Great
if
we
Britain
informal
ally in our in¬
dealings,
that
we
practice of imputing
sinister or'untrustworthy motives
to all British dealings within the
as
an
ternational
the
cease
empire, and that we insist our
politicians do likewise.
Baiting
Britain
for
in
takes
real
or
fancied
mis¬
policy may be a
cheap method of obtaining votes
in some sections, but it is a prac¬
tice dangerous to a continuance
of the collaboration our leaders
seem
are
as
past
to have chosen.
as
we
The British
anxious to establish stable
throughout the
world
are, and the fact that the
approach solutions
differing viewpoints does
nations
two
Cleveland (O.) World Trade Con¬
ference on April 26, Mr. Abbink,
not
in reviewing the economic and
political aspects of the interna¬
ship, however informal, involves
from
other
any
pied country.
You may have wondered why
have
not
t
the
that
suggested
United Nations
should
undertake
immediate settlement of the polit¬
ical ;point$ at issue now that the
Security
Council
organized.
was prior
agreement by the so-called "bigfour,China, Great Britain, Rus¬
The
is
is that there
reason
sia and the United States (France
invited
was
later
to
the
make
"big five") .to the effect that stip¬
in
ulations
would
be
them before
mitted
of peace
treaties
the
decided
between
upon
sub¬
co-belligerents*
of enemy nations*,
they
were even
other
to
not
to
speak
and
it
is
furtherance
in
thia
of
understanding
that
Secretary
Byrnes "has gone to. Paris thi&
If
week.
he
were
to
announce
that the United States refused ta>-
wait longer for a resumption of
trade relations with our former
enemies,
even
siderations
there
is
though other con¬
be
postponed,
reason to believe-
must
every
immediate action would be forth¬
coming by the .entire
second
The
.
,
sug¬
my
approach
economic
gested
group.
phase of
to
world rehabilitation would involve-
quick settlement of the loose ends;
of
Lend-Lease, and a realistic
rather than
partisan approach tc>
rehabilitation,
required:
large as those wewasted on social experiment in.
this country during the last de¬
pression, and have the virtue of
possible recovery through the re—
that
I
by
United
and
attention.
our
coercion
the needs of various countries for-
States, before passing on to other
considerations
against
power, the cost of the policing to
be borne eventually by the occu¬
relations be¬
regarding
Britain
tween
conditions
Britain's
learn—as
motives
ber of policies are questioned
with*
fabrication of steel
4
.
ofl
ability to
England have not impressed us
kets and the
tions that
now
are
measures
which raised wages wholesale
highly
so
specialized a function as the bulk
purchase of cotton fibers for the
textile trade, or, so integrated an
industry as the making of steel,
and
who
heretofore.
of
of
nationalization
the
officials in Washington
The vote of the workers was
part
undertake
to
alization measures under consid¬
cies.
and
But
a
interest
in
lations with Latin America on the
to
hopes to; dominate his poli¬
large
occupies.
dictator, and the ruddy faces of
char¬
be
will," of which Wendell Willkie
used to speak, is developing some
leaks. It will require the highest
order of statesmanship to repair
them, and fo reestablish our re¬
called
members
the
integrity. It will come as a
surprise to many in this country
means
flourish,
that H we
would not sign such an agreement
with a country dominated by a
that parallel what has happened
sharp curtailment in these op¬
erations when hostilities ceased,
and as a result we find that the
"reservoir of Inter-American good
conference
Janeiro
that
decrees
has by no
convincing.
Britain's coal
mining methods have long been
an industrial scandal, due to the
indisposition of owners to mod¬
ernize; and the change in control
of the Bank of England brings it
into somewhat the same position
that our Federal Reserve system
its
and
their
opera¬
as
a
know, that Russia has been tak¬
ing a much more active political
ih
utilities
tion of
political
with
by
problems
deal with them of each associate,
and
above
all,
confidence
in
been-
in
we
to a fanatical totalitarian element
acquired
country like England, though our
experience
appreciation
the
to
\
1
„
helping its own cause in this
country, nor the case for contin¬
ued Anglo-American cooperation,
by the measures for socialization
of industry which it is advocating.
There may be cogent reasons for
public ownership of electrical in¬
stallations
and
railways
in
a
to pro¬
as
considerable
phy much the same as that which
proved to be the scourge of Eu¬
rope. He owes his success at the
polls to the support of labor, and
dictatorial
\
Pan-American mutual Britain does not need the funds
assistance treaty. We announced
in the proposed credit from this
several times and officially, with
country to carry out the nation¬
a
and £ bounties g on
Latin
America in reckless fashion, and
we
resorted at times to ill-con¬
ceived and impractical measures
an order to obtain economic col¬
laboration. There was bound to
gifts
determined
as
complete
Nazi-Fascist philoso¬
a
'•
•
It should be said that the pres¬
ent
British
government isi not
The
de
President has
been elected in; this traditionally
conservative country who is the
antithesis of the type of political
leader we hoped to see emerge in
postwar Latin America. A dema¬
gogue
and opportunist, Colonel
acteristics
stated:
policy of-political aloof¬
ness toward Argentina,
an atti¬
tude on our part which forcec
repeated postponement of the Rio
developments in Argentina
prophecy
regarding
what
may happen there would have to
be hedged with many reserva¬
tions.
By fair means or foul
and* there is a notable absence of
Peron combines with these
of
an economic
stability. Re¬
United States,
mote
cent
—
affairs
for
garding Great Britain, Mr. Abbink
vention in a serious way. It has
becoftie apparent also that other
Latin American countries were
Any
fraud charges
domestic
the
in
ence
confusion
reactions
Blue
phase ;formula
approach to world
another nation, and the document
has raised the question of inter¬
not
and
Our
,
other end of the scale.
Bewilderment
serious
a
Book, issuec
just before the Argentine election
and containing what our officials
considered to be proof of cooper¬
ation between Argentina and the
Axis governments during the war
was interpreted not only in Ar¬
gentina, but in other Latin Ameri¬
can countries, as open
interfer¬
countries
other
was
lations with all the American na¬
voting in July, and perhaps
for a period after that, Mexican
cumstances
election
diplomatic reverse for the United
States, and will influence our re¬
the
conditions will be unsettled.
refer
strain.
Unti
life.
Under
presently, the Good
Neighbor policy may face a severe
Presidential elec¬
impends, and its influence
extends to foreign political anc
economic relations, as Well as to
national
shall
I
In Mexico, a
of
admit.
leadership, and with the
help of another element to which
tion
forms
to
care
we
Peron's
problems.
all
in
neighboring countries
was greater than that of the United
States, and there are indications
that he may be more nearly right
a
business,
.
In for¬
country.
forts
new
take
signs are encourag¬
than otherwise.. The
rather
ing
conservative
eign policy it would be surprising
if he did not make determined ef¬
but the initial
It is no
■'
the
to
come
Changing World
a
situation, criticized the so¬
cialization program in Great Brit¬
ain and then presented a three-
mean that ours
should be sacrosanct. A partner¬
necessarily
credit
to
forthwith.
will
begin
The amounts
not be
as
establishment
of
tions.
rela¬
r,"
•'
-
should
We
fact that
our
collaboration
business
■/
not
overlook
the-
example in economicis usually followed!
quickly by similar action on the*
of
other nations in
theAmericas. Canada has extended a*
credit to Britain of more than $t
part
billion, and has under considera—
tion a large advance to France. In&i
both instances Canada's aid repre¬
sents
her
a
far greater
assets
than
we
proportion of
will employ
in any assistance we may render*
and
Canada's action was taken
without the bickering our
cians consider so
politi¬
essential. Simi¬
larly, Argentina has made a sub¬
stantial credit available to Britain,
xi^ta
^'n^/r.'ctv ;v.*-. v.vr cfceticfiswr
u^^w.v<M^*vwvuiUfca®', ^<5
JVolume
163
Number-4490
;
THE COMMERCIAL & FINANCIAL CHRONICLE
and other American
nations have
promised
to assist Europe to the
limit of their
abilities, with cavil,
a
development that has gone al¬
most
Anglo-Portuguese
Monetary Agreement
unnoticed
here.
^
/
The third phase I suggest of ah
economic
approach
world
to
(Continued from
Rebuilding involves joint consid¬
above a maximum of
eration by government and busi¬
■J.
.1' 5 million, or
ness in this
country of the long<b) if the balance standing to the
term needs for
developing over¬
Bank of Portugal's No. 1 Ac¬
seas
markets, and the method of
count with
approach.
the
on
that
mere
War
volume
of
part
restoration of
of
trade
larger burden
"
both
our
pre?
will
bring
it will,
prosperity. I doubt that
not only because we have
a
creased
There is far too much
assumption
lout because our
productive ca¬
pacity has been greatly increased
in six
years, and advances in
techniques have' made it possible
to produce far
greater quantities
per
man-hour of employment.
Once there is serious determina¬
tion
on the part of labor to
go
back to work, the vacuum of wardenied wants will be displaced
land, London,
fairly
at all times maintain
their No.
on
1 Account with the Bank of
land
minimum
a
amount
of
mined
in
balance,
national
trade
estimated
was
at
tal of nearly twice that amount
must be achieved in the future ac¬
cording to reasonable forecasts, if
^Widespread unemployment is to be
averted
in highly industrialized
countries, and recurring famine
conditions prevented in less de¬
veloped areas. How such a total
be
can
attained, what preliminary
financing of an investment nature
Will
be
required, and what first
steps to take in
for
gram
our
long-range
a
benefit
own
pro¬
in
world
that is peaceful again,
questions that cannot be left
solved until their imminence
more overtakes their
lution
at
un¬
once
political
so¬
future time of crisis.
a
They are
a
are
part of today's eco¬
a
nomic approach to world
in our time.
stability,
i
The last 30 years of the 19th
century were postwar years for
people in the United States. They
ment,
years of great accomplish¬
in spite of weak leader¬
ship,
because
Were
which
will
century will be a postwar period
for the entire world, It will be an
of
era
expansion
^
Well-being
on
and
material
international
an
scale if the American spirit of toand
g a in
world
acceptance,
through economic
measures that
available. In the end they are
more effective than the
po¬
litical expedients they
are
far
always out¬
England
Account
Portugal
a
of
amount
The
two
their No.
on
with- the
Bank
of
minimum balance, the
which
will
be
deter¬
to
with
keeping capital transactions
in
the
of their respective
scope
tween
their areas which do not
direct and useful economic
serve
or
commercial purposes*
ARTICLE 8.
Any sterling held by the Bank
of Portugal shall be held and in¬
the
Bank of Portugal, against
part of the-sterling balances
held by that Bank, either escudos
at the official rate or gold to be
vested
or
the
land
shall
set aside at the Bank of
only
as
only
Bank
as may be
of England,
escudos held
agreed by
and any
be
held
be
may
and
disposal
accordance
with
the
provisions
disposal
and may be exported.
available
if either
present Agreement.
(ii) While the present Agree¬
remains
in
force
the
Board
"
at
which
sary
cumstances. The Bank of Eng¬
land and the Bank of Portugal,
outside
the
(b) to enable residents of
new
the
of the
securities.
(ii) The
of
Portuguese
residents
This year the annual meet¬
ing
is
being
field
annual
The
year
lies,
Mamaroneck,
combined
with
the
nominating committee this
consisted
of
Mellon
of
George
Securities
J.
Gil¬
Corp.;
of
the
sterling
R.
thereto
London, in duplicate,
April, 1946.
this 16th day of
-
(L.S.)
ERNEST BEVIN
(L.S.) PALMELLA.
Nashville Chattanooga
affect the interests of
has
The
oversubscribed.
awarded to the group
were
on a bid of 99.319.
Proceeds from the sale
May 9
the purpose of the present
of the
bonds,
together
with
treasuryfunds, will be used by the com¬
pany to redeem on or before Aug.
1,
1946,
$15,000,000
principal
amount s of the company's series
A 4% bonds, due 1978, at 105%
,
time to time to assigned to it by
the exchange control regulations
(ii) The expression "the Portu¬
area" shall mean
Portugal and the Portuguese Em¬
pire. -, V
and accrued interest.
The
guese monetary
.
(iii) Transactions
between
the
Bank of England and the Bank of
Portugal
been
bonds
existence
100
dates
has
years;
back
never
many
more
of
thasi
been reor¬
has it ever defaulted
nor
in
payment of
the
/
serves
ganized
to be considered
are
company
principal or
transactions; between the sterling interest on its. funded debt. The
area and the Portuguese
monetary bonds being offered are uncon¬
area.
ered
by
a
as
transactions
resident of that
entered
into
The company,
the
ARTICLE 11.
The present Agreement, which
be subject to review arid ad¬
justment after mutual consulta¬
tion,; shrill
come
capital stock of the company.
area.
into force
on
this
whose corporate
principal industrial centers of
the
Middle
important
South
and
forms
ait
intermediate line for
traffic moving between the
arid Northwest ;and
"West
the Southeast*
no
circumstances to be construed
solicitation of
or as a
an
offer
The offering is made only by the
to
as, an
buy
any
offering of the
of such
Prospectus.
Longines-Wittnauer Watch Co. Inc.
area
the
Common Stock
sterling area;
(Par Value $1 per Share)
Price $15 per Share
tries outside the
and the
to
area
sterling area
Portuguese monetary
the
extent
to
which
Copies of the Prospectus
these
the
may be authorized by
Portuguese Government
are
may
be obtained only from such of the undersigned
as
registered dealers in securities in this State.
under the arrangements con-
templated
in
Article
9
(iii)
hereof.
Paul H. Davis & Co.'
ARTICLE 6.
(i) To the extent to which the
Bank of
s
currencies, other than ster¬
ling, for the
for
A. C. Allyn and
Portugal requires sterling
purpose of
payments
in
the
-*
Company S
Incorporated
countries
Emanuel, Deetjen & Co.
:!
providing
'
■
E. H. Rollins & Sons
'
PPP'-;'P:''''P^\;''P-P:
Incorporated
•'
where
such currencies are legal
McDermott, of Harritender, the Bank of Portugal shall
man Ripley & Co.,! and Sanders
Shanks, Jr., of the Bond Buyer.
purchase them through the Bank
Gerald
one
ARTICLE 10.
For
*
area
day.
affixed
Govern¬
(a) transfers to other residents of
and
N. Y.
Club,
in
125,000 Shares
for making—
elected,
is
scheduled for June 20 at Winged
v
Done
United
ment shall not restrict the avail¬
will H be
Golf
have
and
their seals.
of.
.
Foot;
coun¬
the other.
following securities for sale
Kingdom under
arrangements
contem¬
plated in Article 9 (iii) here¬
Gov¬
officers
ment
a
sterling area
Portuguese monetary Bonds Oversubscribed
ar^ to use sterling at their
An underwriting group headed
disposal to make payments of by the First Boston Corp., on May
a current nature to residents
10 offered to the public a new
| of the Portuguese monetary issue
of
$15,000,000
principal
area,, and to use escudos at amount of the Nashville, ChatA
their disposal to. make pay¬
tanooga & St. Louis Railway first
ments of a current nature to
mortgage 3% bonds, series B due
residents of the sterling area. 1986, at par and accrued interest,
(iv) Notwithstanding that each to yield 3% to maturity, less a
of the Contracting Governments concession of V4 to members of
shall be alone responsible for its the National Association of Se¬
monetary relations with third par¬ curities Dealers, Inc. The offer¬
ties, they shall maintain contact ing, subject to clearance by the
wherever the monetary relations Interstate Commerce
Commission,^
This advertisement is not, and is under
Portu¬
the
/'
of
flexibility according to cir¬ shall
which these may be authorized by the Government of
"
meeting of the club,
the
Governors
of
.
payments
area : and
the /. Portuguese
monetary area; and
v;
(b) payments to residents of the
Portuguese monetary area, or
(c) transfers to residents of coun¬
The annual
for
Con¬
Governments shall co¬
operate to apply it with the neces¬
monetary area and the
sterling area to the extent to
Paris Scott Russell, of Glore.
Forgan & Co., for. Vice-President;
B. 0.\ Doane, of the Chase Na¬
tional Bank, for Secretary;
George
B. Gibbons, Jr., of George B. Gib¬
bons & Co., for Treasurer, and C.
Cheeveri; Hardwick,
of > Smith,
Barney & Co., and David T, Miralia, of Halsey, Stuart & Co., for
the
the
area
ditionally guaranteed as to prin¬
(iv) Transactions entered into cipal' and interest by the Louis¬
by the Government of any terri¬ ville
and Nashville RR., which
twelve months after the date of
tory within one of the two areas
the
coming- into force of the described above are to be consid¬ owns 71.78% of the outstanding
ability of escudos at the disposal
,
the
area;
Steel,
of
unless
ments agree
(b) payments to residents of the
sterling area; or
•(c) - transfers
to
residents
of
Report of the nominating commit¬
tee, which has just been filed with
the Board of Governors, also pro¬
members
years
day's date. At any time thereafter
as agents of their
respective Gov¬
monetary area for making—
through connections at Memphis,
either
Contracting
Government
(a) transfers to other residents ernments, will maintain contact may give notice to the other of its Martin and Jackson in Tennessee
of the Portuguese
monetary on all technical questions arising intention to terminate the Agree¬ and Paducah, Ky.
'
Municipal Bond Club
ernors.
after
into force,
Contracting Govern¬
otherwise.
two
guese
Steel Named fo Head
poses
of
monetary;
current nature to residents of
countries outside the sterling
tracting
(i) The
Government
of
the
United Kingdom shall not restrict
the availability of sterling at the
disposal of residents of the Portu¬
residents
(i) The- expression "the sterling
(i) If the two Contracting Gov¬
ment
ARTICLE 5.
of
Portuguese
area" shall have the meaning from
set aside at the Bank of
of Articles 2 (ii) (b) and 3 (i) of
this Agreement shall be at the
Bank of Portugal's free
terminate
the date of its coming
:;,In witness whereof, the Under¬
(a) to make escudos at the dis?« signed, being duly authorized by
posal of residents of the ster¬ their
respective Governments,
ling area and sterling at the have signed the present Agree¬
ernments adhere to a general in¬
in force ih the United Kingdom..
ternational monetary agreement
or
or
shall
shall
the Agreement—
Government changes
gold to be
its monetary policy iii such a
way
Portugal
that the provisions of the
in Lisbon.
present
Agreement would be affected, the
ARTICLE 4.
two Governments shall review the
(i) Gold set aside in Lisbon in
Agreement with a view to making
accordance with the provisions of
any amendments that may be re¬
Articles 2 (i) (b) and 3, (ii) of
quired. In any event, discussions
this Agreement shall be at the
between representatives
of the
Bank of England's free
disposal two
Contracting Parties shall be
and may be exported.
held for the purpose df making
(ii) Gold set aside in London in such a review not later than
at the official rate
Governments
interested parties—
invested
agreed by
ARTICLE 9.
England, against
part of the escudo balances
held by that Bank, either sterling
or
countries
of Drexel &
Co., has been nominated to head
the Municipal Bond Club of New
York for the year 1946r47.
The
Contracting
by the Bank of Eng¬
Bank of Portugal.
(ii) The Bank of Portugal shall
have the right at any time to sell
to the Bank of
a
with¬
policies, and in particular with a
view to preventing transfers be¬
to
in London.
co-operate
•
assisting each other in
all
England
*
(iii) As opportunity offers, the
and the
Contracting Govern¬
-shall
guese
H.
areas.
tries outside the
view
at all times maintain
run.
Walter
cur¬
ARTICLE 7.
the ments
(iv) The Bank of England shall
all
requires
legal tender, the
Bank; of England, shall. purchase
them- through the Bank of Portu¬
gal against payment in escudos.
deter¬
be
agreement: with
the
spirit of the
America of that day could not be
broken. The last half of the 20th
of
the
quickly by a surplus in mined in
agreement with the
many lines, and tomorrow is not a
Bank of Portugal.
bit too early to begin consider¬
ing the problem that will face us
ARTICLE 3.
jvhen that eventuality occurs.
(i) The Bank of England shall
Pre-war, the volume of inter¬ have the
right at any time to sell
something like $80 billions. A to¬
in
payment
Eng¬
Bank of England.
1
against
,
(ii) To the extent to which the
Bank
Agreement and will ment and the Agreement shall
closely on exchange cease to have effect three months
affecting the two after the date of such notice.
It
control matters
rencies of the Portuguese mone¬
tary area, other than escudos, for
against gold to be set aside in: the purpose of
providing for pay¬
the name of
the Bank of ments in
the countries where such
Portugal at the Bank of Eng- currencies are
(iii) The Bank of Portugal shall
.
England
sterling.
the
collaborate
seek with the consent of the other
2653)
page
of
the Bank of England amounts to £5 million,
much
a
of debt to amortize,
of
out
The
2677
May 16, 1946
'
'
-
•
'»
-
!'
if
THE COMMERCIAL & FINANCIAL CHRONICLE
267a
i
•
i"
Thursday, May 16, 1946
high-grade medium term section.
There is also the possibility of an
overdue reaction in Dominion in¬
Canadian Securities
ternals.
ment
By WILLIAM McKAY
events
Recent
-
point towards the resurgence
of the
The
bond
Canadian
Govern¬
market, which faith¬
fully followed the overrapid rise
in U. S.
Governments, has so far
Canadian
expansion of the Dominion to the North in not reflected the recent major defew years has largely overshadowed the great potentialities 'cline in this market, and it is un¬
of the economic development of Northern Quebec and Labrador.
likely that the Bank of Canada
Just as the growth of air-transport hastened the unlocking of Can- j will indefinitely maintain prices
East.
The spectacular
the past
ada's vast Northern empire, in the same way the wartime
ment
ignored mineral
wealth of this neglected region,"
One
of
the
most
important
the
at
an
artificial
level.
and «►
of airfields in Quebec
Labrador has redirected attention
to
establish-^
hitherto
.
mineral
developments of recent
has taken place in Northern
Quebec and Labrador. * Vast de¬
posits of high grade iron-ore have
years
been prospected by the Labrador
Mining and Exploration Co., in
conjunction with the Hollinger
Strikes Adding to
Inflationary Forces
II; [(Continued from
SUiuj.,u
page 2652)
^v.v-Cis
«.- v
uflU
snut—
Consolidated Gold Mines Co. This! downs would be less. Some prog¬
area has
been also found to be! ress has been made in reducing
Canadian Securities
rich in copper, zinc and nickel.
It! the money supply by using Treas¬
is believed that this
field ! will! ury balances to pay off public
eventually
richest
;
become
one
of
the
of
iron
in
the
sources
debt held largely by the banks1—
and that is all to the good. Bal¬
Gaspe Peninsula of ancing the budget and having the
with
Quebec, the northern end of the! largest ; possible; H surplus
which to reduce public debt, will
Appalachians, spasmodic explora¬
tion for oil since the beginning of be necessary^ But this is inevit¬
the century now appears at the ably a slow process.
world. On the
.
culminating stage.
Likewise, the idea advanced in j
The Gaspe Oil Ventures Ltd., some financial circles that in¬
assisted by capital raised by stock creased interest rates would be an
issue in this country, is according effective remedy, reflects, in my
to a recent report, ready to com¬ opinion, a failure to evaluate cor¬
mence
drilling operations. | This rectly both the causes of and the
sparsely
populated
area
has appropriate weapons against the
known oil resources; but its pos¬ unprecedented inflationary pres¬
.
stocks
bonds
,?.
MARKETS maintained in
all classes of Canadian,
external
and internal
bonds.
.
Stock
sibilities have hitherto
orders
Exchanges,
at
or
net
Dominion Securities
Grporation
Place
New York 5, N. Y.
■J':
Bell System Teletype NY
1-702-3
,
,
CANADIAN BONDS
GOVERNMENT
PROVINCIAL
MUNICIPAL
CORPORATION
CANADIAN STOCKS
A. E. AMES & CO.
INCORPORATED
TWO WALL STREET
NEW YORK 5,
in
the
and
Government
bond
would
.
We must work for peace as we
worked to win the
war.
We must
all work* and work constantly, to!
settle
the problems that, might
to
lead
conflict and war.; That is
2644)
page
total of $32.5 billion, fell in 1934
to 11.5% of the much smaller
total
of $18.5
billion*
This decline in
exports ;■ contributed to thn
severe depression in
industry anil'!<
the collapse in agriculture; "
!; V!"
Our exports of wheat,
cotton,
our
tobacco and lard
ly hard hit.
we
•
were
particular-i
Frpm 1925 to 1928'
sold
abroad on the
average
than $1,250 million of these'
more
four
crops annually.
From 1931 A
1934, our average sales were"
only $473 million a year. The dif-'
ficulty of finding markets abroad
for our agricultural surplus
was
an important factor in the
decline
of nearly 60% in farm prices from
to
Thef depreciation
responsibility of the.^United! 1928 \o 1932.
Nations—and that means Russia in currencies was also an impor¬
and
England, as ;well, as ?#ie tant; /element ; in ^his decline ! in A
United States and the other coun¬ farm
prices.
When the 'pound
tries. We must do this job.
sterling, for example, depreciated
from $4.86 per pound to
$3.20, it
Remove Economic Causes of War put pressure on the prices of aR
We must have international co- j American farm' products sold ip
the
'
{operation r;da political problems. world markets*
That is most important, but it is
Must Eliminate Currency and •
not enough* The economic causes
,w
conflict
of
must
be
,
,
Trade Restrictions
eliminated.
Our
trade cannot reach
thp
high levels necessary for Ameri¬
must be carried on in a fair and can prosperity if the world agah^4
friendly way, conducive to good 1 resorts to currency and trade re¬
will * and
mutually
beneficial strictions* Unless our -exporters1
The every-day
the
relations between
businessmen
of
countries
all
greatly in¬
have access to world markets oA
uated a few miles from tidewater crease the cost of carrying the trade. /
•
',
'
fair and equal terms we will not
on the St. Lawrence within easy
public debt. No reduction in buy¬
The Financial Agreement; with
be able to maintain our produc-. [
access to the refineries in Mon¬ ing power gnd no increase in pro¬
England,, which you -are now con¬
tion in those fields in which we
treal, the discovery of oil in com¬ duction would result—and these^ sidering, is above all for the pur¬
have
long
mercial quantities would be an are the basic causes of the prob¬
specialized—growing I
pose of establishing a sound and
:
event of the utmost economic Im¬ lem.
fair .basis for .world -trade and in f cotton* tobacco and wheat* raak- f
ing automobiles, machinery and
portance to this area.
;
The solution depends upon how this wa.y lessening the dangers of
equipment. In short, we must have
Northern Quebec and Labrador
quickly we deal with what is political and. economic warfare*
a high level of trade between our
moreover form part of the min¬
overwhelmingly the chief cause- r vThis Government, has advocated
nation; and other, nations tq hav6 ■
eral rich Laurentian Shield, but
production, because we cannot a program of international eco¬ full
production, full employment,
until recent years climatic condi¬ deal
cooperation
to
restore
quickly enough with the ex¬ nomic
and- a large national Income; in
tions and geographical inaccessi¬ cessive
money supply. We could world trade and to eliminate the
America*
All; ^sections
of ••ouy
bility have been instrumental in have done better in dealing with currency and trade discrimina¬
confining
exploration
to
its it if we jhad not prematurely re¬ tions that divide nations into con¬ country* all sectors of our econ-c
southern fringes. Spurred by, an duced taxes and repealed the ex¬ flicting economic blocks. No one omy are directly or indirectly de¬
pendent upon foreign trade.
initial success, further valuable cess
profits tax. We should not country can by itself, deal with
International economic coopera¬
discoveries are almost inevitable.
reduce taxes further while the international economic problems,
tion-and the expansion ot world
As in the exploited southern sec¬
because they are not national in
danger, exists.
trade: are/definitely In the intCT*-*
tion of the Shield the northern
Character.^ They !af e the Respon¬
It; shoul&be liorne
est of this country and all coun- areas are intersected by turbulent
sibility of all countries. We have
necessary as it is to hold the line
tries* When; countries exchange*
rivers which provide an almost
proposed,
therefore,
that -; the their
by price control legislation, such
surplus products they all'
inexhaustible source of hydro-*
controls are greatly weakened un¬ United Nations provide the means
gain because it makes possible in- •
electric power.
continuing
c o operation
less reinforced by allocations 'of for
creased production of their spe^ $
:/-;*When consideration- is
also
scarce
materials and rationing. thrdugh.rihepInternational ■ Bank* cialized
products. ' This
means!
given to the fact that this region
Having discarded these reinforce¬ the Internatio n a I Fund, and inore production ;and 7 a higher»
js adjacent to the St. Lawrence
ments, the strain on price ceilings through an, international trade level of income in the country ;
River, which is clearly destined
is intensified and the way made organization.
which sells, as well as more goodsJ"
to vie with, the Danube as the
easier for black markets and the
and a better standard of living in |
leading inland waterway of the
Big Stake for U. S.
resultant breakdown,-of enforce¬
the country which buys.
;
world, little imagination is re¬
The success of this program will
ment.
This program for the general;,
quired to realize the potential
mean
a good
deal to the United welfare can be put into effect if
We must, if this nation is to be
importance of; this / undeveloped
States.
Our economy has always
the United Nations, and particu-1
saved from an inflationary spiral
section of Eastern Canada.
been dependent on foreign trade,
that; can only end in deflationary
larly the United States and Eng¬
Turning to. the market for the
It will be more dependent on ex¬
land, adopt the same fair cur* >
collapse, hold on to the controls
past week the anticipated general
ports and imports in the years rency and trade practices.! To*
that are left; we should, by all
decline duly materialized.
The
ahead. We must buy abroad many
gether these two ;> countries do
means,-stop further growth of the
volume of sales was not heavy but
of the raw materials for our in¬
about one-third of the trade of the i
money supply and, if possible, re¬
buying support was not sufficient
dustries and some important goods
entire world. The countries closely *
duce it, but above all the answer
to prevent wide-spread price re¬
for our consumers.
We must sell linked in trade with
to the problem is more work and
England and !
cessions. There was also - some
abroad a large part of our pro¬ the United States account for 75% e
more production. If democracy is
evidence of profit-taking in the
to survive we must be willing to duction* as much as 8 or 10%, to of world trade. If these two coun*
highgrade within 10-year ma¬
face the Lact, that minority pres¬ keep out agriculture and indus¬ tries were to adopt the same fair *
turity range.
try running.
currency and trade practices, the'
sure groups, whether of labor or
;
Internal bonds continued inac¬
Let's not forget the lesson of rest of the world would inevitably
capital, have no right to act In
tive; but there was a resurgence flagrant disregard of the public Ihe decade before the war when follow. On the other hand, con-.;
of activity in Yellowknife golds interest. The
people of the coun¬ our agriculture and industry suf¬ flict between the United States;
on reports of further spectacular
England on currency and!
try look to their government to fered 'severely from trade and and
drill-hole results.
With regard to immediate pros¬
N. Y.
pects there is every likelihood of
\
RECTOR 2-7231
tions
market
a
,
Direct Private Wires to Buffalo,
Toronto and Montreal
40 Exchange
today.
Higher interest rates
would make for serious complica¬
sures
(Continued from
world torn by fear and
strife. No country, no matter how
big or strong, can remain either,
in poltical or economic isolation. !
Maintaining peace requires con¬
stant vigilance by the people of
all countries. We know, at long;
last, that enduring peace does not
follow automatically the victory
of our armed forces. Our people
have learned that peace as well
as
prosperity does not come to
these who; merely sit and wait,
i
in
per
'
New York Prices.
'■
ne¬
glected in favor of exploration hi
more; accessible
areas
in
the
prairie provinces and Ontario. Sit¬
executed
(for dealers, banks and
institutions) on the Mon¬
treal and Toronto Stock
;
been
The British Financial Agreement is
Essential to World Peace
NY-1-1Q45
continuance of the downward
course of the market in general,
a
assisted
by
profit-taking
in
the
protect them from such abuses of
freedom
by
finding
effective
means for
continuing production
and employment while controver¬
sies
between
ment are
and manage¬
labor
being settled.
.
%;
:
;
currency restrictions!
Because of
these measures the exports of the
trade policies would just as in- ;
evitably;; dividetheworldinto;
United
economic blocs.
harder hit
other country.
Our share of world exports, which
States! were
:
than those of any
1928
in
was
15,8%
of the
world
American Export Trade
;Gonsider what would happen
England should have to maintain
.,
the
We
present currency and trade
restrictions. American goods can
offer, subject:
Province of Alberta
If• ^ & Company ■§§?:.
64 Wall Street, New York 5
;
WHitehall 3-1874
CANADIAN
$50,000
taylor, deale
.:
STOCKS
ZVz%Bonds, Due June 1,1980
:
(Callable at 100 in 1950)
Principal and interest payable in New York
or
Industrials
;.;-vV
Price 100 & Interest yielding
Government
Provincial
Municipal
Corporate
Bought—Sol<i— Quoted
sterling buy
CHARLES KING & CO.
Wood, Gundy & Co.
Incorporated
14 Wall
Street, New York 5
to
Toronto & Montreal
matter
can
Members Toronto Stock Exchange
61 Broadway, N. Y.
Whitehall 4-8980
Direct Private Wires
Banks — Mines
%
CANADIAN
SECURITIES
—
Canada
,
Royal Bank Bldg.
Toronto, Canada
'
\
Teletype NY 1-142
Direct private wire to
Toronto
,
bought by foreign countries,
only with dollars. The only way to
buy American cotton and wheat, !
American automobiles and ma¬
chinery is to pay in dollars. If,
and only if, sterling is convertible
into dollars, can the holders of
be
of
products. As a
countries
get the dollars they need to
buy goods in
the money
the
our
fact,, many
America only with!
England pays them for
goods they
brief,
sell to her.
In
American export trade is
y©tome 163 /Number 4490
directly dependent
the
upon
THE COMMERCIAL & FINANCIAL CHRONICLE
con¬
compelled
to
t/" During
came
the war, - sterling be¬
inconvertible currency.
an-
It could be used to inake
pay¬
ments in the sterling area; but it
Could not be converted into dol¬
their
concentrate
vertibility of sterling into dollars, purchases in England.
American
producers will have little chance
to
export to the countries holding
blocked- sterling/ On the other
hand,
if the countries holding
these balapces can get them grad¬
lars,
If this wartime restriction
ually/converted into dollars, our
is
continued, serious " limitations exporters will be in a position to
would be placed on our
exports. compete on fair and equal terms
Countries like :• Canada, the Britthroughout the sterling area,
/ish Dominions, and the agricul¬
tural
countries of
Europe; which
-customarily have
large
a
favor¬
able balance of payments / with
England,_ would
be unable to use
sterling they receive for their
-exports to pay for their imports
in dollars from the
United States.
•the
Our / trade
.-would
with
have
these
be
to
restricted
have
cause,. they would
means
countries
be¬
not
the
to pay us.
If sterling cannot be converted
•into dollars, England and the ster¬
ling area countries must^ concen¬
/
The continuation of these
time
restrictions
will
war¬
reduce
world trade and force it into
economic channels.
desirable
one
to
protect
world trade from this
result, and
that is by establishing the cur¬
rency and trade practices that we
have proposed.
These practices
are
based
the
principle that the
of
the
world
should remain open on fair and
on
markets
export
trate on their trade with each equal terms to the exporters of
all countries.
It is another ap¬
•other, not because their goods are
.better, hut because of monetary plication of the old American
doctrine of fair play and equal
impediments. It will mean that
Egyptian and Indian cotton will opportunity.
j
jeplace American cotton, RhodeThere is no doubt that the Brit¬
^ian and Near Eastern tobacco ish Government and the British
will
replace American tobacco, people favor this program. They
and British automobiles and ma- recognize that such a
program is
.chinery will replace American in their- interest as well as ours.
automobiles and machinery.
Although the British
want
to
In
balf the trading area of the world, adopt this program, they are not
/American products would be at a in a position without help to meet
serious 'disadvantage in competing the obligations it entails. ' They
with
the products of
"area
the sterling
Our trade with
countries.
Britain
and
the
would become
sterling
area
a mere trickle.
American exporters ask no spe¬
cial advantages in trading with
foreign
that
•
,
countries.
They
discriminations
no
do
ask
di¬
be
cannot commit themselves
to al¬
lowing American products into
England on the same basis as im¬
ports from other
countries
the widest possible flow of world
trade by establishing stable and
Conference
of her
orderly
prospect of
effort, Britain's inter¬
national financial position.deteri¬
orated by about $17 billion from
war
1945/
1939 to
Britain's earnings
from shipping and other
abroad
when
they do not have the dollars to
pay for such imports.
They can¬
not commit themselves to
cqn-
that
services have also been
sharply
re¬
ada.
in
war,
spite
of
before
the
large
earnings
building
program. The
financial and
commercial
from
services
haye fallen off along with
trade
and
shipping.
England's
With the recovery of world trade,
these services will again expand
and become
important part of
England's foreign business.
an
Before the
the British
war
peo¬
ple. were able to earn enough
their
exports
and their
from
services to foreigners to purchase
abroad the food and raw mate¬
rials
In
essential tq their /economy.
1938, about one-half of Brit¬
unless she
and
can
have
dis¬
restrictions
help, primarily
the United States and
With
Can¬
such
help, England
would be able to put into effect
the fair currency and trade stand¬
ards which we have proposed and
which she supports.
After friendly discussions over
several
months,
the
American
and
British
negotiators
agreed
that England would need a credit
of $3% billion from the United
States.
that
This
from
credit, together with
Canada, will enable
England to continue her essential
imports during the next few years,
while removing the wartime cur¬
restrictions and
rency and trade
discriminations.""
The
Financial
ain's imports was paid for by the
export of British goods.
About
one-fourth was paid for by serv¬
ices of the British Merchant Ma¬
Agreement
thus
provides
two
things, a commitment to end dis¬
criminatory currency and trade
rine, insurance
q;ther financial
England to carry out the commit¬
companies,
and
and commercial
An additional one-
institutions.
practices
The British people
have indus¬
triously set about to restore their
international
economic
position.
They are reconverting their war
industries to civilian production.
They
making
are
determined
a
effort to increase their
industrial
efficiency. They are exporting as
much as they can without depriv¬
ing themselves of the essentials
credit
a
to
enable
ment.
Here
is
what
the
Financial
Agreement provides:
1. England will not discriminate
against American products in any
of
her
import controls.
So
long
fruits
she
buys
cotton
or
abroad, she will not discriminate
against the import of American
as
cotton
If
fruits.
or
it
becomes
necessary for
England to limit
her agricultural or industrial im¬
verting sterling into other cur¬
ports, this will be done on a basis
fair to all countries, including the
rencies; when they do not have
of life. These are problems which
United States.
to the reserves necessary to do this.
the British people must work out
sell their products in competition
2.
For any goods or services
for themselves ever the next few
Britain an Importing Nation
with the products of other, counpurchased in the United States,
years./ But during this transition
tries, provided the buyer has' a
England will pay in dollars or if
England is a country that must
period, the feeding of the British
fair chance to select American live
by jmpor/s.
payment
is
made
in
pounds,
Two-thirds of
people and the supplying of Brit¬ American
goods oft the basis of quality and the food consumed
exporters will be able
by; the British ish
industry will result in a sub¬ to convert the
price.
But American/producers peopte and
sterling into dol¬
-virtually. all of the stantial need for
foreign credit/
will not have their /fair chance basic raw
lars.
That goes for American
materials, except coal,
to sell their products in the ster¬ used
in British industry must be Two Methods Available to Britain movies as well as American ma¬
ling; area until the dollar pool is purchased abroad. As a
chinery. And it applies to income
conse¬
The
British can finaqpe this
terminated.
rected
against them.
ducers
are
;
perfectly
.
Our
pro¬
willing
England is a great im¬
porting country.
She is the best
quence,
Wants Dollar Pool Ended
;
customer of the Uniied States and
'
The dollar pool is the wartime
of a
arrangement made by England to
What
mobilize aftd conserve the dollar
of
resources
tof the
all
sterling
of the
area.
countries
Under this
j; arrangement
a coufttry of the
\ Sterling area that secures a sucjplus of dollars; from exports to
the
United
States
transfers the
England for a sterling
dollars to
The dollars
deposit in London.
j are then allocated by London to
t
the various members Of the ster¬
ling area for the most essential
purchases
requiring payment in
Iiv practice, dollars are
pot allocated for buying Ameri¬
dollars.
machinery
can
or
other
any
American goods which can be
bought in England or anywhere
in the sterling area. Some Ameri¬
can
exporters
iri
are
effect
ex¬
ploded from a large part • of the
world's markets. That is why we
.
| waftt the dollar pool brought to
I
end*
|; • Another danger to -American
I trade :i is the large amount of
an
| blocked
sterling/,;During the
war
the countries of the sterling area
accumulated
held
ances
banks
or
Treasury
large
as
sterling bal¬
deposits in London
invested
securities.
in
British
These
bal-
J
ances. were acquired as a result
| of their wartime exports to Eng¬
land or military < : expenditures
| made by England in India and the
j Middle East which
sterling.
Because
were
paid
iri
these
sterling
\balances could not be converted
jinto dollars or used to buy exports
/from England, they were called
blocked
:
:
sterling balances."
";
What is done about ihe liquida-
ftion of these blocked sterling balj
ances
will make
a
big difference
| to American trade.
I'says
If England
that these balances can be
| used only to buy goods in Eng¬
land, then the countries holding
| more than $13 billion of these
| sterling balances will, in effect, be
of
score
England
other
does
countries.
to
eliminate
wartime currency and trade re¬
strictions will affect bur trade and
the trade of the entire world.
*
England's
international
nomic position has bene
eco¬
seriously
'distorted
traditional
in
need
two
ways.
One is the road of economic
blocs
and
economic
It
warfare.
is the road of economic isolation.
The other is the road of Bretton
Woods.. It is the road of interna¬
tional economic cooperation.
During the
war England im¬
comprehensive
currency
posed
and trade restrictions.
These
re¬
by the war.
For five
years, England was the principal
target .of the Luftwaffe, as well as
the principal base of operations of
the Western allies against Ger-
aspect, and
a very necessary aspect, of Brit¬
ain's wartime financing.
What
England did,- in effect, was to cre¬
many. Her life was
of the British
at
stake, and
The punishment which
took—and which she handed
ours.
she
out
strictions
ate
were
one
economic
an
bloc
composed
Empire except Can¬
ada, and including a number of
other countries, principally in the
—wrote
stirring chapters in the Middle East. This bloc is now in
history of free men.
operation. If England cannot get
help in meeting her import needs
Britain's
War Burden
I speak of this not as a reason
for the Financial
Agreement, bethe Agreement looks to the
present and the future, not to the
past, but I speak of it to empha¬
eause
size that during the
war, England
had little time to think of her ex¬
port trade. She devoted every
source
which
she
could
on
re¬
mobilize
to her defense and to; the
attack
the enemy. British exports fell
until,
by
1944,. they
only
were
30% of their prewar volume. The
men released from the
export in¬
dustries
were
the next few years, she will
over
put to work at
be
forced
extend
continue
to
her wartime
and
even
restrictions
discriminations,
and
The great danger before
is
con¬
flicting blocs.
In the economic
sphere, we are trying to meet this
problem through cooperation in
Fund
World
and
Bank,
If
England adopts the fair currency
and trade practices we have pro¬
posed, it may be possible to avoid
the
formation
the
Fund
of
bloc
a
Bank
and
outside
under
the
war
leadership of a great power. But
production or;;were inducted into
if England finds it necessary to
the armed froces.
keep her wartime restrictions, it
Lend-lease
from
the
United will result in a British bloc and
.
States and Mutual Aid from Can¬
ada
filled part of the
gap between
her wartime needs—mostly for our
common
cause
and her current
—
supply of foreign exchange. Nev¬
ertheless, she had to draw heavily
on
her accumulated foreign ex¬
change resources, and strain her
credit
her
abroad
essential
in
order
war
to
an
American
also
a
act
bloc.
And
it
will
encouragement to
Russian bloc.
Such a develop¬
as
an
imports. / She
hesitate to do business with
Eng¬
land
for fear
that its earnings
cannot be transferred.
American
businessmen
tries
can
to
pay
4.
Within
Area
Dollar
a
year,
Each
Pool.
the sterling
pletely free to
country
will be com¬
dollars it
earns
to
buy goods anywhere.
India, for example, could use the
dollars it gets for its exports to
the
United
area
use any
States
Latin
and
to peace
\
,
British people have shown
with
can
be carried
The
us
in
British
our
on
fully and
people
effort
to
are
secure
portant commitments.
They rep¬
adoption
of the
letter and spirit of the
United Nations program for fair
resent
whole
a
hearted
currency and trade practices.
carry out these Commitments
land
will
next
few
will
get
need
help
To
Eng-/
during
the
years.
That help she
from the credit .under
the Financial Agreement with the
States and, it should be
United
added, from the same Financial
Agreement with Canada.
If
Congress
approves,
the
States
Government will
line of credit of $3% bil¬
in favor of England.
This
United
open a
lion
credit
be
can
drawn
by Eng¬
on
land until Dec. 31,
1951, to pur-j
chase goods and services in the
United States. It
by
England
also be used
can
for
meeting
the.
transitional
post-war
deficit
in
her current balance of
payments,
and for helping England assume
the
obligations
of
multilateral
trade/.
f
for paying off the blocked sterl¬
ing balances or any of Britain's
wartime
will
debts;
have
to
*
resources.
these
be
obligations
from
met
-
other
1;
..
Beginning in 1951, England will
the credit over a 50-year
period, with interest at 2%. The
principal of the credit must be re¬
paid without qualification. Under
repay
conditions of
world
depression in
severe
f trade, the interest due in
given year may be waived
under objective standards stated
in
the
Agreement, If • such an
emergency situation develops, it
any
is
clearly in the interest of the
United States to accept the prin-;
cipal and not to force a default
which would have serious
the world
quences to
conse¬
Z /
economy.
Interest Rate Low
Naturally,
less
than
obtained
much
interest
rate
is
have
would
to
from
bankers. -The
Agreement,
than
more
Agreement
on
a
Fi- Z
however,
is |
loan. It is an"
,
the "major aspects
of financial and commercial policy.
When we take into consideration
the commitments
,As
a
we
receive from
matter of fact/the interest
is substantial.
If the credit were
used in five equal annual amounts
and all interest payments were
met, the effective rate of interest
under
the
would
be
Financial
1.83%,
•
Agreement
and
over
$2.5
billion of interest would be paid,
The rate of interest is reasonably
close to the average cost of money
to the Treasury.
This
5. A settlement will be made by
England with the countries hold¬
ing
blocked
sterling
balances.
England has agreed that any pay¬
ment
in
liquidation
of
these
.
j
,
/
point'Will' bear emphasis?
the credit is only a part of the
Financial
Agreement. The pur¬
of the Financial Agreement
balances
blocked
buy goods in
can
be
used
to
country, includ¬
ing the United States.
Instead of
being forced to spend the blocked
sterling balances in England, the
any
in Z our international v eco-t
nomic program. The full participa¬
fully
tion of Britain in this program is
necessary
Agreement by Congress will as-?,
the implementation of ou£
sure
whole international economic pro¬
gram.
to
export
in
these
/ 6.
In
agreed
to
addition, England has
support the American
for
an
international
trade organization to reduce trade
and
criminations.
porting
this
eliminate trade
dis¬
With England sup-
proposal, the forth¬
\
■
Z
Z
,
Credit Not
a
?
»
1
Precedent
The credit to Britain cannot be
dia and
chance
if it is to become effec¬
tive. The approval of the Financial
holders of these
a
precedent
for
other country.
a
loan
to
any
The National Ad¬
visory Council on International
Monetary and Financial Problems
has issued
a
statement of
our
for-*
eign loan policy in which this is
made clear.
I read from that re¬
port:
•
"The
;
strictly commercial loan
pay on a
nancial
the
Britain
is to enable England to particpatq
markets.
The
}'■
im-
are
pose
,
British People Will Cooperate
These six commitments
part of. them to England.
fair
menace
\
America without turning over any
fairly.
more
England into dollars
by these coun¬
for goods they pur¬
used
unless we
agree to a temporary extension,
England will dissolve the Sterling
barriers
largely
sure
chase in the United States.
trade
amount to
as
of world.
a
prosperity
every
success.
temporary
be
debts which
billion,/very
a
converted by
and
proposal
$13
be just
balances, like In¬
Egypt, will be free to buy
goods
wherever
they
prefer.
American exporters will have a
and
Trade
\
forth
extension, England on her currency/ and
England will remove all of the trade policies, it becomes/ clear
that the Agreement would amply
restrictions on the convertibility
of sterling for ordinary current
repay the American people even
transactions.
In practice, this will if no interest were paid. And some
mean
that the money that Eng¬ would say we have made a good
land
pays to
Canada, Australia investment if the whole sum were
a gift.
and India for her imports will be
to
agree
clearly their desire to cooperate
in
buildingr a world
in which
than
will
of payment in dollars from Eng¬
land as they were before the war.
3.
Within.. a
year,
unless we
vestments; she reduced her gold
and dollar reserves by $615 mil¬
lion; and she incurred foreign
now
ift
everywhere.
No
country wants this kind of world;
ho country, can afford this kind
ment would be
secure
sold $4.5 billion of her foreign in¬
investments
No American firm need
England.
in
us
the division of the world into
the
American
from-
of
one
Nations
holds
None of the credit can be used '
Terms of Loan Agreement
fourth was paid for, out of the net
income of British capital invest¬
ments abroad.
and
United
Important Commitments
lead
trade
secures
coming
discrimina¬
trade
which
and
currency
one-fourth
than
know
astrous consequences,
But Brit¬
ain cannot abandon her wartime
from
smaller
They
and
stifle world
conflicts
duced. Because of enemy sinkings,
British merchant marine is
the
conditions.
restrictions
tions
to
Meanwhile,
un¬
There is only
way
blocked sterling balances held by
foreigners in London. As a result
the
Need Fair Trade Practices
'2679
y
,
proposed loan to Britain^
requiring
Congressional
(Continued
on page
author*
2680).
^
THE COMMERCIAL
2680
•
The British Financial Agreement
modities4 for:
which
is
the
part of
integral
an
foreign economic program of this
No ouxer country
iias the same crucial position in
world trade as England.
Because
of the wide use of the pound ster.Government.
:
ling in world trade, the large pro¬
portion of the world's trade which
is carried
the
Empire, and the ex¬
of
England
British
treme
by the countries of
on
the
restrictions a
have to be solved. Principal of
which hamper trade.
The Financial Agreement with these problems is to defeat the
forces of inflation which are so
England is an essential part of
our
whole program of interna¬ widespread and so rampant. As we
tional economic cooperation. This all know, the forces of inflation
program of the United Nations is arise primarily out of the fact
the
concerned with some of the most that
supply of purchasing
important problems of every day power, created during the war is
life. How we meet these problems very great and that the supply of
removing
but one by
case,
dependence
The end of the vyar has created
number of problems which Will
will
in
determine
whether
large
part
States and
United
the
imporis, the financial and
^commercial
practices of Britain
.are of utmost significance in de¬
the world will again go
of
tions
upon
through
devastating cycles of war and de¬
pression or whether at long last
termining : what kind of world we realize the hope for peace and
economy we shall have. The early prosperity.
realization of the full objectives
If we do not remove the irrita¬
the
,
Woods
Bretton
program,
including the elimination of ex¬
change restrictions and otner bar¬
riers
world
to
trade
invest¬
and
requires
an
immediate
solution
to
Britain's
financial
ment,
ments to
trade,
we .feed
impedi¬
of
world
international
trade
tled, and
soon
as
as
set¬
are
the produc¬
tivity?; of labor and equipment in¬
creases we can expect with a fair
degree of confidence that the sup¬
plies of commodities will increase
rapidly. We know how great the
quantities
of
commodities
pro¬
It
question
can
a
be.
sound
a
continued imposition of certain of
economic
these restrictions for
United Nations and in the world,
much
as
as
five years; in the Financial Agree¬
ment of Dec. 6, 1945, the British
their removal within
agree to
the effective
from
year
one
date of
that
Agreement.
It • is the view
of the Council that the British case
,1s unique and will not be a
a loan to any
"country."
;
help
'them
will
from
be available to
institutions that
the
operation. The Inter¬
national Fund will provide help
needed for currency stabilization.
International
Bank
will
be
the
principal agency to facilitate
foreign loans out of private capi¬
tal for reconstruction' and devel¬
-
In -the emergency peuntil the
International
opment
ir i
d,
o
several
atmosphere con¬
And good eco¬
relationships between na¬
-Bank is in full operation, the Ex¬
port-Import Bank will meet only
the* most urgent needs for recon¬
struction aid.
It is the policy of
balance.
Bank Deposits as Source of
an
Inflation
ducive to peace,
nomic
tions
can,
than
more
in themselves, give us
a fighting chance for
lasting peace.
Essential to World Peace
importance
production and employment
right here at home. The United
States is the greatest single eco¬
of
are. now in
The
the
in
I want to "stress the
Other countries will need help.
This
create
we
other
Other Countries Need Help
r
order
prece¬
dent for
;;
difficulties
labor
con¬
As soon
and of time before the factors of de¬
mand and supply will be in better
exchange
build
and
the
But if we duced by our factories
the fields is, therefore, primarily
stable enduring peace.
meet our problems in
problem. The. Internationai Mone¬
for
sumption is still limited.
the greedy productive capacity of the coun¬
try is, and we know how great the
god of war and largely nullify the
other efforts we make toward a
tary Fund
agreement permits the
the
alleviate
and
availablbe
commodities
as
nomic force in the entire world.
The level of
national income
our
is the determinant of world trade.
If
maintain
we
production and
world
trade
will
employment,
flourish. The greatest contribution
the: United States
make to the
can
and prosperity of the world
is to keep America ; strong and
prosperous and the advocate of
justice in the council of the na¬
peace
tions.
This
is
in
world
a
countries
which'
the
share
must
all
same
the other source df
namely,
the
huge
purchasing power in
the hands of the people, requires
careful thought and study on the
part of the people at large and
particularly on the part of the
bankers.
We know that during
the
war
the
government
was
obliged to sell a large amount of
government
securities
to
the
banks. This is primarily respon¬
sible for the huge volume of de¬
posits in the country. Steps are
already
being
taken
by
the
Treasury to reduce the supply of
deposits by redeeming a portion
of maturing obligations.
That,
however, is not enough. In order
However,
inflation,
of
amount
forces
the
defeat
to
inflation
of
it is absolutely
essential that the
budget be balanced and that steps
be taken to retire outstanding and
destiny. It will be peace and pros¬ maturing government obligations
this
Government i to make the
with a surplus of revenues over
perity for ail, or war and depres¬
agencies esablished by the United
Furthermore, it is
sion for all. We cannot escape from expenditures.
Nations the means for continuing
these problems by withdrawing quite evident that the manage¬
cooperation on currency and inment of the public debt under
from the world. Political or eco¬
"vestment problems, and to leave
nomic isolation is an anachron¬ conditions as they exist at the
these
to
institutions
the
task of
providing the- funds necessary to
implement this program.
There
«
are
people
some
who
ism; it is
cause
it
dangerous policy be¬ present time is bound to exercise a
great influence on the inflationary
forces in the country.
Above all
a
unreal. There is only
is
way to assure the security $hd
welfare of this country. That is to
one
recognize that it is in the interest
of the United States to offer
Eng¬
face the world's
land the proposed credit, but they
fear thai, the credit will add. to in¬
other countries.
flationary pressures in this coun¬
try, I am much concerned about
the
inflation
from
problem.
I know,
experience, how
first-hand
important
the
inflation
Is in this country..
the
credit
-
to
problem
I believe that
Britain
will
not
materially increase the danger, of
Inflation.
■,
with
The
total
amount
of
of
one
credit. to
per
the next five years.
A consider-*
&ble part of the credit will be
tised in later years when the
sup¬
ply problem is less hcute.
Some
of the credit will undoubtedly be
used for goods that are in abunthe
supply.
;
credit
goods
The
that
Inevitably,
will
are
be
in
CommerfQ
mates
that
some
needed
scarce
supply.
Perv^tment
about
of
for
esti¬
one-fourth
of
And Jefferson
College
James Herbert Case, Jr., the son
former Chair¬
of the Federal Reserve Bank
of J. Herbert Case,
man
of New York, was
elected to the
Presidency of Washington & Jef¬
ferson College of Washington, Pa.
office,
assuming
Case
Mr,
declared that "Small independent
it so."
...
,
;
:Mr.4' Case,
age
in
served ; as
and
the
who is 39
..Navy,
Princeton
will
our
on
assures
needs
of
the
prevent any undue
domestic supply and
minimum
essential
other countries.
-Lin the end the
inflation
enough
way
problem
goods.
Agreement
is
The
will
and
from
people
which
a
great
achieved
efforts. It could
have
through their own
also have far-breaching
adverse
the financial in¬
stitutions 4of the country and no¬
tably the banks. While it cannot
be denied that the danger of in¬
consequences on
flation is great,
tremendous
as
available for
creased.
Task of Financing
Assistant to the Pres¬
the Stock
Clearing Cor¬
he directed the inspection of
trading
on
Exchange
change
the New York
for
the
Stock
Security
Commission
and
in
produce
Financial
versity.
A brother, Dr.
;
which
for
banks
were
established, but we will also re¬
duce the dependence of the com¬
mercial, banks for earnings on
Government obligations.
In this
respect we can look with a great
deal of confidence into the future.
The
sion
physical aspect of reconver¬
has practically been com¬
Although a great deal of
pleted.
time and energy was
of
difficulties
labor
lost because
strikes,
and
Ex¬
1940
be
the
they the principal agents in
distribution
of Government
securities
among
ultimate inves¬
they themselves stood
ready at any and all times to fur¬
tors,
but
nish
the
Government
with
wherewithal to fight the
enemies.
the
external
The work accomplished
V;
Everett Case, is
Banks
throughout
the country
have given very careful thought to
the method of financing the pur¬
chase and sale of durable consum¬
there
falls
for
those
of
who
us
have never been engaged in
that
type of business; the motto should
be "First learn to walk, then run"
or to follow the old doctrine of
look and listen.
In other
words, make sure that the risks
stop,
at Hamilton, N. Y.
and
adopt
a
on
our
oars
self-satisfying atti¬
invest
them in
the
funds
merely;
entrusted
to
profitable and safe way;
but also to do everything withia
a
their power to counteract and to
defeat the forces of inflation which*
pronounced at the present
this respect I must call
to your attention the fact that ir*
are
so
time.
some
In
circles proposals have
beepi
made to defeat the forces of infla¬
tion and to alleviate the debt bur¬
den of the Government at the
pense
of the banks.
It
was
ex¬
certain
Public Debt Can Be Solved
'
The public debt can be solved.
In spite of its magnitude it is
\
class
in
the
United
States
has
institute a policy; 3
Government we *
not merely carry
grown, and if we
of economy in
certainly
can
the debt burden but also
gradually,
reduce the public debti This, how¬
be achieved not through r
of hand measures.
The
solution of the public debt lies in
also
that the capital resources
hard work and in a policy of econ- ?
warrant a substantial increase in
omy.
Any effort to solve the pub- 1
risks among your earnings assets.
lie debt at the expense of the
For smaller banks, particularly,
banks is bound to undermine the *
those operating with savings de¬
position of the latter. Banking is
posits, there will be considerable a
highly essential business and js '
outlet for their'' funds iri mort-,
closely tied up with the system- 6£
gages?
Most of these institutions
private enterprise. As bankers we
have had considerable experience
must fight all these proposals not
with this type of investment. They
merely for the sake of protecting t
know the risks, and they .know
our own
businesses but also in
the strain of a mortgage loan. We
order to protect the economy as a
must, however, in this respect not
whole.
s
overlook the fact that real estate
In conclusion, in spite of the
in many instances is highly in¬
flated and that the market value great problems which confront us,
in spite of the fact that the war
of real estate is not always com¬
has increased the public debt; in
parable with the economic value.
Of course, the principal thing that spite of the fact that there is a
great deal of unrest throughout5
we as bankers can do in this re¬
the world, we can look with con¬
spect is first to make sure that
For¬
the loans that we are making are fidence toward the future.
undertaken by us are commensu¬
with the rate of return and
rate
ever, can
sleight
t
Second, we ought to make
through easy credit
terms or otherwise we will not
stimulate the forces of inflation in
sound.
that
sure.
real
and
estate;
bankers with years
above all, as
of experience
tunately^ ^harik Heaven, our coun-'
try was spared the effects of actual
Our
warfare.
industries
are
in¬
The
productive capacity of
the country is greater than ever ;
before in the history of the coun¬
tact.
remember that try. We are blessed with an
natural resources,
run in cycles abundance of
and that sooner or later even in and new inventions have further
the field of housing the forces of enriched the economic life of the 5
We have an abundance
demand and supply are bound to country.
of skilled labor, and business con¬
reassert themselves.
must' always
we
real
estate
Banks
values
tying
mortgages
up
over
their money in
a
There
long-range point of view.
will be room for sound
The
housing
financing.
shortage .is
very
great, and while the estimates of
some
Government officials that
2V2
million homes may be con¬
during 1946 and 1947
structed
may
exaggerated, yet we
be
boom
rest
Their task will be not
do.
to
entirely within the carrying capa¬
While experience of
city of the country.
While the
the past has shown that this type
public debt is very large, yet the
of financing on the whole is sound,
productive capacity of the country; j
yet we must not overlook the pit¬
has also increased.
The middle
ognized by all the leaders in the
country in and out of Congress.
This, however, does not mean that
can
^
ers* goods.
know that
bankers
Banks Will Have Plenty to Do
The banks, therefore,"during the
coming year will have plenty to
,
by the banks has been fully rec¬
we
v
yet industry is again ready to pro¬ that the huge public debt con¬
duce, and the higher prices as well tracted during the war will create
as the higher cost of production
considerable discussion.
among
will require additional banking
politicians, economists as well as !
credit.
Furthermore,
we
know bankers. It was also certain that
that the tremendous volume of some
people will endeavor to find
business in'the next few years is ways or mean?
qf bow to solve
bound to be substantially greater the
debt; problem without having
than ever before in peacetime. to pay for it.
v
The greater volume of business
One of the means suggested
f
activity coupled with the fact that to solve
this problem at the ex¬
prices and the cost of production
pense of the banks.
The sugges¬
in general will be higher makes
tion has been made that the re¬
the oytlook for loans on the whole
serve requirements be increased*
favorable.
In
addition,
banks
Other suggestions have been made
throughout the country must real¬ that a certificate
reserve be im¬
ize that a number of changes have
posed on top of the legal reserve
taken place in the financial struc¬
requirement now in force. Other
ture of companies as well as in the
proposals have been made that the
methods of doing business.
We
public debt be paid off in legal
must, therefore, change our poli¬ tender
currency and that through
cies and try to find new outlets
the introduction of the 100% re- <
for our funds. In this respect, too,
serve
system the consequences
we can look with a great deal of
therefrom be avoided.
confidence
toward
the
future.
by them during the war." Not only
President of Colgate University
.
reconversion
the
of the country. In doing
will not only perform the
function
Reconversion
The banks of the country can
were
ident of
consumption has in¬
>
best
considerable
period of time should not merely
He justly proud of the record attained take the
narrow,
but also the
taught at
Hotchkiss School for a year.
also acted
of
became Secretary of Brown Uni¬
encourage product ion in this country and abroad
security
many
to the
finance
ability
our
process
we
to
>
to beat the
to
nomic
Lieutenant
graduated
1929
in
a
years
years
controls
political developments of the
country but also would undermine
to a considerable extent the eco¬
.
those
drain
spiral
and wages devel¬
ops.
Such a spiral, if it ever
should develop, would not only be
yet based on the
productive capacity
in liberal arts and sciences or be
of the country, on the good com¬
left behind.:; The experience of
mon
sense
of the people, there
college education should be as are valid reasons to believe that
revolutionary and exciting as fall¬ these forces will be kept in check
ing in love but we do not make until the supply of commodities
colleges must arouse new interest
poration of New York and for six
allocation and export
must make sure that no
and
the proceeds of foreign loans will
be spent on such products.:
In
cases
we
between prices
disastrous to the future economic
On
cent of the aggregate
expenditures in this country in
ant
them
Case Jr. Heads Washington
Purpose of Credit
England
under' the
Financial
Agreement is less than one-half
problems and deal
in cooperation with
bankers-is
so
Problems
The first task before us as
tude.;
of
tion.
(Continued from page 2-379)
special
Postwar Banking
(Continued from first page) *
• civilian
* consump¬
Essential to World Peace
; ization, is a
.-V
»v"",.
is
Thursday, May 16, 194Q
FINANCIAL CHRONICLE
&
of
course
man
substantial building
bound to develop unless
is
reaches
a
all
a
cerns
in
a
throughout the country are
We know
strong position.
there
that
is
a
tremendous
mand for all kinds of
from home and abroad.
to pay
know
that
duce them.
industry
how to harness our
tage
kind.
of
our
people and of man- j
We must not overlook
fact that
we
has become exceedingly
-
may
occur
the
live in a world which
that any adverse
*
pro¬
to utilize them to the best advan¬
the cost of construction
-
can
therefore, is
resources and
Our task,
point where the average
cannot afford to buy.
We know
people have the ability
for these commodities," and
the
that
we
de- j
commodities
in
small and
development that
any
part
of
the
[Volume 163" Number
'
THE COMMERCIAL & FINANCIAL CHRONICLE
4490 '
26Stf
-**r
"World is bound :to have its reflec¬
tion on the United States;
The
economic and moral
the United- States has
we,
is within
A Bulwark for Peace
will allr do the best that
us
'
at
the
same
time
contribute to the speedy restora¬
tion of sound economic conditions
throughout- the world;
4
Bonds, Preferred and Com.
Stock of Central Maine Pr.
filled every
thing less than our duty, not only
to the ideu for which it stands, but
days together.
were
times
of
war,
day. with the anxiety that war
brought; anxiety often about the
many problems arising from the
collaboration of our two countries;
the sort of troubles that are bound
to arise
in
conscious
are
•
stant kindness.
-
we
well give a
can
to follow. There is
of these times.
Kubn, Loeb & Go. Offers
Ui S. Rubber Delis.
An
underwriting syndicate oi
headed by Kuhn, Loefc
May. 10, offered to the
public a new issue of $40,000,000
But it does
79
will always
need the
sort of leadership your people and
mine can give, the sort of leader¬
ship that only people who are free
themselves can give to others.
That
sore
need
as
has
been
never
it is today.
that
has
within
scale
human
history.
so
from
threatened
May 1.
rehabilitation purpose?
and
ment
borrowing
money
pany.
by
the
com¬
.....
.
Proceeds will be added to the
general funds of the company ane
used to provide additional work¬
ing capital; to expand the com¬
pany's business through the de¬
velopment and acquisition of new
are
lines of products; to increase ca*
and
parity; and improve (manufactur¬
ing methods and equipment o"
the domestic and foreign plant?
engaged in
the production V
chemicals, textiles, rubber good/and plastics,
,
Also, the financing will provide
overwhelming majority
of them are humble folk, who only
wanted to be allowed to live their
lives in peace,
and yet this terrible
thing is happening to them. 1 And
Xv do not think that you*or I or
any decent minded person will funds to rehabilitate and restore
sleep peacefully or eat happily if foreign rubber plantation prop¬
we
are
are
to feel that we
not able
doing all we can to help them.
something that calls from
our
for the
countries
if
erties
and
Here is
both
Co.
of
succeed
Edward
President of the San
as
Martin
Blyth & Co., Inc., on July 1,
Club,
t>ond
Francisco-,
according to election
results announced this week.
'•
Other
officers
named
.
were;
George J. Otto, of Irving Lund-'
borg & Co., Vice-President,. and
Gilbert Colby,
of Wells Fargo,
Secretary-Treasurer.
They will
hold office lihtil Dec. .31. '
George
H. Grant of the First
Company
and
Paul
Pflueger of Max I. Klshland &- Co.
California
year
elected directors for
one-
a
term expiring June 30, 1947.
Holdover directors with terms
ex¬
piring Dec. 31, 1946, are William
Agnew of Shuman, Agnew & Co.,
and Ed-son A. Holt of Holt, Collins.&Ede.
In
1
'
accordance
•
with
custom,
President,
board1 of
deben¬
by a major unit of the rubber in¬
dustry in the postwar era, the
offering constitutes entirely new -
death. An
sure answer,
CALIF.-tStanley Dickover of Elworthy &
Martin,
the retiring
Unitec. w*)l sit with the new
directors.
*
the
The
nancing for expansion, improve¬
memory;
starvation
with
of
Co.
Representing the first public fi¬
a war
people
of
Millions
Rubber
-
FRANCISCO,
.
all recorded
probably never in
of
SAN
tures, due May 1, 1976, are pricec
at 100%%
and accrued interest
asunder, wiped out their frontiers,
and uprooted their populations.
There are the problems of keep¬
ing the peace when we have made
it. And apart from all that, now,
at this moment, as I am talking to
you, we face the dreadful fact of
famine in Europe and Asia. There
has not been a catastrophe on such
a
debentures
States
countries
whole
torn
firms
2% %
are
problems now with us
peace after the upheaval of
Election Results
& Co., on
the
of making
There
plan to re¬
San Fran. Bond Club
were
we
saw in Germany; Italy and
Japan. The world does riot want
dictators; it has had quite enough
of them; it - rightly lays at > their
door all the loss and suffering and
and
we
seeing you.",
leadership of this
kind and dictatorship of the kind
need
But
ordinary citizens; and because
our hope and our purpose
we won't say "goodbye" in
Eng¬
lish, but in American, "We'll be
ference between
sorrow
af¬
that is
world of dif¬
a
an
as
lead,
that all other
may pray
deep
so
turn here before too long, not ar
an ambassador and his
wife, but
peoples of good will may be glad
and of probr
lems, for which there is no quick
or. easy solution.
Sometimes we
are beset by doubts—of the reality
c The preferred stock is being of¬
of the victory we have won; of
fered in exchange to holders of the extent to which we can all
old preferred through the First work together to insure the world
Boston Corp. and associates.
In against the scourge and tragedy of
the case of the: 7% and $6 pre^ war; of our capacity to use aright
ferred: stocks,
holders will be the new" and fearful scientific
given' the tight to ; exchange for knowledge we have acquired. But
new
preferred on a share-for- as we pick our way across this
share basis.
Two shares of old boggy; and
.a
this great op¬
us
to have
come
fection and parting, from so many
who
have shown us such con¬
their
,
Here we
which
living today in an uncomfortable
world.
It is full of questions, to
Mich no man at present can re¬
turn
given
have"
World Does Not Want Dictators
a
us
have
lives to win for
,
of
who
portunity.'
,
Most
those
to
,
-
Five
years' roots grow
deep, and there must be sadness
about leaving a land for which we
behind it, we shall be doing some¬
dark
tonight,, from Lady Halifax
myself, is inevitably a sad bus¬
iness.
They
some
partnership between
two peoples, who had had very
£o. Offered to Public
'{
An investment banking group little practice in the art of work¬
fieaded by Harriman Ripley & ing together and sometimes found
Co., Inc., on May 10 offered a new each other's ways, and even each
issue of $13,000,000 first and gen- other's language, a bit hard to un¬
crai mortgage bonds, Series N; derstand. Yet when troubles and
2%% due 1976 of Central: Maine misunderstandings arose between
Power Co., at 102% and accrued your country and mine, I. soon
interest to yield about 2.65%. The found I could talk about them to
bankers were awarded the bonds you with complete frankness-—just
as if I were talking
to my own
May 7 on a bid of 101.261.
v
1
An underwriting group headed people; for I knew that at bottom
by the First Boston Corp. on the you would feel about them just as
I did; that though they might be
same day offered to the public
•373,632 shares bf I common: stock annoying,-, they were less than
(par $10) of Central Maine power dust in the balance against ? the
compelling
forces
that
Co., at $28 per share.: The com¬ great
mon
stock was awarded to the brought us together in war and
group at competitive bidding on will still, please God, keep us to¬
; May 7 along with 220,000 shares gether now the war is over. And
of the company's $3.50 preferred in our future reckoning there is
Stock ($100 par). On the common something we can add to that. For
stock the group, specified the ag¬ while it has always been true that
gregate number of shares for on the deep issues of human life
«which the company was to re¬ we thought alike, we have now
ceive $10,000,000 and on the pre¬ the memory of those years which
ferred the group bid 101.50 less a we spent together in a comrade¬
compensation of $1.42 a share in ship of work and suffering and
connection wtih the exchange of finally of victory. And that will
tiew
preferred u for * outstanding count for much in the years to
come.
v
shares of preferred.,
"
t ; The public offering of the com¬
An Uncomfortable World
mon stock is subject to the pre¬
emptive rights^ Ot approximately
8,330 shares of the company's 6%
preferred
and -common, stocks
(other than the „;New. England
Public Service Co., the parent or¬
ganization). The parent company
has waived its tight to subscribe
for additional common,
you
and
(Continued from page 2643)
to solve our domestic
problems arid
<
Anglo-American Cooperation
strength of
placed upon
responsibility. II am sure
ft great
that
greatness and future of your
country.vi- {{
Well, my friends, to say good¬
bye as I am trying to say it to
construct
to
ditional
same
the
repossesser
acquire ad¬
or
domestic
for
plants
quality of effort and leadership
which brought us through in war.
when
and
and
foreigr
manufacture
o'
present lines of products.
-.uncertain/' country,
The
debentures
will
have
the
Vcss, Blair & Go.
Forsited in Gliicago
,\:
(Special to The
Financial
Chronicle)
CHICAGO, ILL.—Vpss, Blair &
Company has
been formed
with,
offices at 29 South La Salle
Street,
to engage in the securities busi¬
ng Howard W. Voss and Henry
Allan, Jr., are partners in the firm.'
Mr,
the
Voss
has been serving with
S. Navy,
Prior thereto
with Barcus, Kindred
U,
he; was
Co.,, with which Mr. Blair
was
also
associated,
—
mm
—
New Ifork Stock
.
Exchange
Weekly Firm; Changes
"
The New York- Stock Exchange
has announced the following firm
Privilege ofv George F* Cotiriiff-
:
■
to act
as
alternate
on
the floor of
the Exchange for Robert L. Newburger of Nevvburger, Loeb & Co., >
withdrawn May 9.,
Privilege of George S. McNa-
/was
;
to act as: alternate for Wil¬
liam M. Meehan of M. J. Meehan;
& Coi was
M^Tawn May 11. Mr.
mee
5%;$50. par preferred will be ex¬ presently we come to a patch of Anglo-American Cooperation and
benefit of a sinking fund of $2,- McNamee1, retired from* the firm
changed r for. one new share ,of good firm ground on which, we
on the same date.
/
$3.50 preferred. - Cash adjust¬ can stand and be secure.{And that
But I: didn't really want to say 000,000 a year, to begin on May 1.
:
Sidney W. Moss withdrew from
ments will be made in each case
ground, of course, is the friend¬ much on these grave matters to 1957, which will retire the entire
partnership in Edward R. Vinqr &
equivalent to the difference be¬ ship and co-operation of the peo¬ yjou tonight* I meant to say good^
issue by maturity.
Co. on May 11,
'
tween the call prices of the old
ples of the United States and the bye, and in saying it to try to
preferreds and the, initial offer¬ British Commonwealth.
It has tell you a little of what I feel for
ing price of the new.
been said that whenever we are this country, which has been my
: "Because these securities are believed to be exempt from registration
Proceeds from the sale of the depressed and feel the world is home for so many years. As I
they ham not been registered with the Securities and {Exchange Com'
preferred and common stock, to¬ out of joint, the right remedy is have gone about the United States
mission, but such exemption if..available does not indicate that ,ihe
gether with treasury funds and to count our advantages. So when and talked to all kinds of people,
securities have been either approved or disapproved by the {Commit*
the proceeds from the sale of $13,- we feel that the times in which we I: have: often heard forebodings
sfon or that the Commission has considered\ the- accuracy or {complete*
000.000 principal amount "of the live are difficult and uncertain, a for the future, prophecies of all
ness of' the statement in this communication.
company's first and general mort¬ good remedy is to remember this the troubles that are likely to
gage 2%% bonds, series N due one big fact; or better still, to come crowding in on you now the
NEW ISSUE
1976, will be used by the company take out a map of the world and war is over. Of course, there will
to redeem $13,314,000 first and look: at the United States and the be troubles, plenty of them, but
Offered fcr Speculation
general mortgage 3^% bonds, se¬ British Commonwealth and Em¬ if I know anything of this coun¬
ries H due 1966; $4,186,000 first pire; to measure what they add up
300,000 Shares
try, they are not going to get you
i--*V ■{■<{"*■
and general mortgage 3% % bonds, to in population, in natural re¬ down. The other
day I was read¬
series J due 1968, and $3,500,000 sources and in industrial power;
ing again the great poem which
serial notes due June. 1, 1946-Dec. and above all, to think what will Wadsworth wrote about his coun¬
?>
1, 1952.
The company will also be the effect if this massive try and mine some 130 years ago
redeem or exchange 111,231 shares weight is placed solidly
IMCORPORAT
E
P
behind the at the end of another great war,
of
7% preferred stock; 79,191 United Nations Organisation in its when people were saying much
| shares of $6 preferred, and 21,518 work for a peaceful and .ordered what they are saying now. He was
Common Sfock-rrPar Value $1 per Share ;
shares of 5% preferred.
world. I dont know how you feel giving them their answer and he
COPPER—GOLD—SILVER
The company, an operating sub¬ when you look at it like that.; I ended, you may remember, with
sidiary of New ; England Public know that for myself each time those splendid lines:
These shares are being issued to provide for a
working tunnel and
Service Co., is engaged in the gen¬ this thought comes into my mind
Some fears unnamed
underground work iti the Crisiina Mines, the exploration of certain
eration, transmission, distribution it fills me with new. confidence
I had, my country—am I to be
mineral showings on other' leased propertyt the purchase of
equipment,
and
sale of electric energy to for the future. For we know that
blamed?
and the shipment of any selhcted ore encountered. Underwriting dis¬
about 167,000 domestic, commer- the power you and we have will
counts and commissions
Now, when I think of thee, and
twenty cents per share aggregating sixty thou*
cial and industrial customers in never be■ abused;
that it will
sand dollars.
what thou art,
'
.
| the industrial centers of Maine, never be & directed against the Verily from the bottom of. my*
This offering is made through the Prospectus | including Portland, Lewiston and rights or liberties of other people;
heart
/
f about 250 other cities and towns. that there is nothing selfish in our
only, which will be furnished on request.
Of those unfilial fears I am
§1 Gross operating revenues for the friendship, for we are ready to
v
>
,
•
.
-
.
CRISTINA LIIHES
■
>
1
"
.
.
.
"
t
.
,
fi
all who
will be
12 months ended Feb. 28, 1946, to¬
be friends
ll
taled $15,403,109 and net income
friends with us; and that our joint
|
for the period was $3,272,862.
Giving effect to the present fi¬
nancing the company will: have
outstanding a funded debt of $45,780,000 and capital stock compris¬
ing 5,713 shares of 6% preferred
($100 par); 220,000 shares of $3.50
preferred, and 1,690,415 shares of
common
($10 par),
with
strength may be for the world a
stropg guarantee of peace and
justice. Dont let us ever forget,
either, that the strength of the
United
Nations
strength
the
dedicated
of its members; it can
dearly must we prize thee; we
who find
In thee a bulwark for the cause
of men
"
,
.
,
:
CRISTINA MINES'
/
And that is what America
be
today—a
cause
bulwark
can
the
for
of men; and so it will al¬
be
faith
in
as
long
,
,
•7
ways
more
Share
,
do not place this mightly force
be
Price $ I per
For
than that; and if
never
we
is
ashamed.
as
yourselves
you
and
have
in
the
I
C
N
'
O
R
p
11
401
O
R
ATE
D
"
'
■
"■
Broadway, New York 13, N. Y,
Telephone WAIker 5-7612
I
:•
'■{■..{
■
v
THE COMMERCIAL & FINANCIAL CHRONICLE
12682
Thursday, May 16, 1946
•rte
UN
Vigorously Planning
*6':
Better Social and Economic World
a
of those meetings
case
which
are
So the public will still be
closed.
fe^^k^Continued frdm page 2638) ■v.-'.$$$$$%
getting; differing reports of what is going on.
The Economic and Employment Commission will" make a; broad
fcludy of the world's devastated areas (concerning whose definition
Broad Trusteeship Issues Brewing
[there is considerable doubt); will devise means of handling the
world's future surpluses; and 1f Mr. Lubin has his way,, will make
The extreme controversy embodied iti UN's scheduled overall
inventory of the complete assets of each of the nations of the
■f. 'Q
World.
implementation of the trusteeship process, as laid out at San Fran¬
cisco, is high-lighted by the colonial big power politics struggle being
demonstrated at the current Paris Conference, The negotiations for
.
'
Leading Inti Bankers
Accept Increased Quota
In Greater NY Campaign
Leading investment bankers of;
New York
City have accepted aquota for. 1946 of $40,500 hi the
Greater
New
York
Fund's
>
9tly
world; the initia¬
Annual Campaign.
This was an¬
equip homes in ways and means which
nounced by Alexander M. White
settlement' of the trusteeship of this Italian colonies, which must be
of White, Weld & Co., Chairman.'
Will enable the housewife to devote more time to civic affairs; the in¬
concluded before the matter comes before UN's General Assembly,, is
ternational exchange of all categories of woman workers in the
of the Campaign Committee
rep¬
industrial, agricultural, and cultural fields; systematic training in revealing the controlling political motives of the several victorious resenting the profession,
following
Powers in the Mediterranean.
Women's affairs; the conduct of polls and forums throughout the
a
meeting in the offices of White,
For her security Britain feels in dire need of maintaining trustee¬
World—are but seme of the projects under consideration by the
Weld & Co.
The new quota isship over Cyreahaica, and of controlling Tobruk and Bertgazi—with
Bub -Commission on the Status of Women.
25% more than was contributed,
its nearness to Malta. And this motive^ of course, governs London's
last year by investment bankets.
negative
attitude
toward proposals for giving Lybia to an
[ Progress Toward the International Trade Organization
This year the Fund is appealing
Italian trusteeship, or directly to a collective UN :trusteeship.
'l:/ Plans for implementing the International Trade Organization of
for $5,900,000 as its city-wide
goal,
United Nations trusteeship settlement in this area is likewise
the United Nations are progressing on both sides of the Atlantic.
which likewise is 25 % more than*
running into the interests of the French
andjtlie' aggressive Arabs.
JWhile the setting of a definite date for the preliminary conference
was/ contributed in 1945.
The apr
As far as the United States is concerned, we have persistently
to be held in London has been held up pending approval of the
peal is v to business concerns and"
We have employee groups,
U. S.-British Loan agreement; a tentative charter has been drawn shown ourselves to be quite hypocritical on the subject.
including organ¬
applied an extremely sacrosanct attitude toward the colonies of Italy ized
up by the United States' Executive Committee on Economic Forlabor, for business's share in *
and other places where we are not directly concerned. But when it
feign Policy.
the support of 415 local
hospitals^
comes to the Pacific, we displays quite different policy.
Foe our health and;welfareagehcies.
There are to be two main international conferences in this
War and Navy Departments here have successfully exerted»great
Mri White declared that his:
ephere.
The United States Government has Invited i4 countries,
pressure, and will presumably retain the backlog of Congress; for group gave wholehearted
of which six arc British and three West European, to meet in a
support
taking Over the former. Japanese islands; for our strategic Interests. to the Greater New York Fund'spreliminary way in London, presumably in the Fall. Thereafter, and Thus We shall be insisting
that, Saipan and Tiriian be placed under campaign as one which the whold:
possibly not until early 1947, there will be a full-dress conference
our Sovereignty in lieu of being placed under UN.
In line therewith business community of New York
for all the United Nations member nations elsewhere in England,
is our newly reported desire to get from the British sovereign con¬
should support.
'
„*,
^
to consider all the still-open questions on trade and employment.
trol over three additional islands for our defense system: namely,
: N. Baxter Jackson, President Of>
The conferences, whose basic aim will be to promote the ex¬
Canton, which is now jointly controlled, and the British colonies of the Chemical Bank & Trust Co., is;
pansion of production and the exchange and consumption of goods Christmas and Funafuti. '
'
'
' •
General Chairman of the cam-:%
throughout the world, will first of all investigate those many factors
Nor do our Claims in Iceland, which are apparently opposejd paign.
!
Which are interfering with the free flow of trade. The other mailt
hy that country, seem to exemplify a lofty international attitude on
Members
of
the / investment
points on its agenda will include:—the achievement of high levels of our
part.
1
\
;
bankers committee include: *
jS
i>s
employment and economic activity; restrictive business practices; in¬
$
:js
Harry W. Beebe* Vice-President,;
ternational commodity agreements, and the establishment of an In¬
Harriman Ripley & Co., Inc.; Wal¬
ternational ' Trade Organization as one of the UN's specialized
Action Awaited by Atomic Commission
ter F. Blainer, Partner, Goldman,
.agencies."
The United Nations Commission for the Control of Atomic En¬ Sachs & Co.;* William R. Brent**
i
In England the Government is conferring with, and collating ergy is complete. But, despite rumors to the contrary, no date for
Syndicate Manager, Eastman, Dil¬
the views of, every industry likely to be affected by tariff changes; the Committee's convening has been set.
lon & Co.; James Coggeshali, Jr.,
after which negotiations will be held with each of the other
Under the resolution establishing it, the work of the Commis¬
Vice-President, The First Boston*
Institution of woman suffrage throughout the
.
tion of agencies to plan and
.
,
„
.
.
'
.Commonwealth Governments.
Z Whether Britain's
;
;
steps of nationalization and
with these international trade
many
sion is to proceed by separate stages, the successful completion of
planned each of Which will develop the necessary confidence of the world
;
;
aims, is before the next stage is undertaken.
consistent
strongly questioned by "The Economist" of London. Additionally
skeptical is it in saying: "One cannot help Wondering whether, in
this mass of details, anyone will find time to emerge from the trees
and have a look at the wood."
economy
are
Commission is to submit its reports and recommendations
Security Council, and such reports and recommendations- shall
be made public unless the Council, in the Interest of peace and
secutity^ otherwise directs. Whenever possible the Security .Council
shall transmit these reports to the. General Assembly of the United
In any,event, whether, anything ;is achieved or not, the program
Nations, and, in appropriate Cases,, to the Economic and Social
•Constitutes \ another vigorous step in the Rooseveltian international
■Council and Other organs within the framework ~ of ^ the United
{technique of ''keep 'em talking.*'
■
l*
Nations.
The Commission will not infringe upon the responsibilities
.
.
The
to the
,
Corporation;
Thomas T. Coxon?
Vice-President, Mellon SecuritiesCorp.; Enos Curtin, Vice-Presi-:
dent, Blair & Co., Inc.; Jo M.
French, Syndicate Manager, BlythSc COit^Inc.; Herbert S..Hall^ part¬
ner, Morgan Stanley & Co.
Paul
Hay, Partner,
F.
Co.; Joseph H.
Langley &
Executive
W. C.Kingk
Vice-President, Union
Corp.; James J. Lee,
Securities
the United Nations.
These organs will consider Assistant Secretary *& Assistant
the recommendations of the Commission in the performance of their
Choosing the Commission Members
I
Treasurer, Lee HigglnsOn: Corp.?;
tasks under the terms of the United Nations1 Charter,
•
Mead A. Lewis, Partner, Dick &
Much discussion has been devoted to the qualifications of the
In view of the Security Council's primary responsibility under
Merle
individuals comprising the commissions. Devising a formula has pro¬
Smith; 3 Plant
McCaw,
the Charter for the maintenance of international peace and security,
vided an extremely nettlesome problem. The primary difficulty has
Smith, Barney & Co.; Frederick L<
the Council Shall issue direction^ to the, Commission In matters
been
encountered in setting forth the relative importance of geo¬
Moorer partner. Kidder, peabody;.
affecting security.
On these - matter^ the ; Commission shall be ac¬ &
Co.; Richard M. Newall, Dillon,'
graphic,^ general political, and personal expertness and qualifica¬
countable for its work to the Security Council.
,
tions. C To what relative degree will the members be independent
Read & Co. Inc.; Leonard D. New-',
The membership of the Commission consists of, all" members
,borg? partner, Hallgarten & Co.;:
experts, and to what extent representatives of their governments?
of the Security Council and Canada when that stale is not a mem¬
The present feeling on this point is one of compromise, in that a
Miller H. Pontius, Syndicate Man-"
ber of the Council.
This membership will change with"
com¬
member should be an expert but should carry the approval of his
ager, F. Eberstadt St Co., Inc,fe
government and be "familiar with" its national policies. He should position of the Security Council, with the exception of Canada,-which Louis N. Singer, partner, Lazard,
will enjoy the same permanency of membership as the five per¬
not be picked geographically per se, but the major importing coun^
EreretCo.; Percy M, Stewart,
manent members of the Council.
trie& should be represented.
partner; Kuhn, Loeb & Co.t Joseph*
The terms of reference of the Atomic Commission say that it A. ■,
Thomas, partner,
Lehman
"Shall proceed With the utmost dispatch to enquire into all phases
Brothers,
The Economic and Employment group devoted a recent executive
of the problem," and make such recommendations from time " to
I———ri
session to designing a set of rules for choosing Commission members.
time as it finds possible. In particular, the Commission shall make
A definitive suggestion,/devised by Mr. Lubin on which the Commis¬
Paul Klopstock Dead
specific proposals:
:' '
sion will take action, follows:
Paul Klopstock, Who has been(a) For extending between all nations the exchange of basic
1. The Economic and Social Council should designate 10 coun- /
active
in
investment
bafiking,:
scientific information for peaceful ends;
tries from which members of the Commission should be se(b) For control of atomic energy to the extent necessary to mining and the importing and ex¬
j
lected.
ensure its use only for peaceful purposes;
;
porting business, died in Guelph/
He(c) For the elimination from national armaments of atomic Ontario after a long illness.
| 2. The Council should request these 10 governments to submit a
weapons and of all other major weapons adaptable to mass was formerly with Klopstock &
j .-..t panel of two names each, from their own nationals.
Co., 141 Broadway, New Ydrk
destruction;
3. The Council should appoint one person from each of these
He took • part in the con¬
<d) For effective safeguards by way of inspection and other City.
countries.
struction of Guayaquil and Quinto"
means to protect complying states against the hazards of
d The remaining five people should be appointed by the Council
railroad Iri Ecuador and the> ex-*
of
any
organ of
.
.
v
-
,
,
.
f
"
-
from
v.
violation and evasions.
roster, and these five people shall represent certain
a
fields
of
economic
knowledge
which
will
give
balance
*
if
#
.
■
tension
of
Mexican
t-he
National
RaUroa^V A, member of the Ameri^
the types of problems with which the Commission will have
About the New Site
A Novel "Beef''
to deal.
T
.
to
Plethoric
have
been
the complaints,
recriminations, and Sug¬
can
he
Institute of Mining
Engineers,
also active in the develop-"
of mines in, Goldfield and
was
ment
*
concerned with the new contemplated arrangements for
other Nevada districts.
$2,000,000 interim site.
But an entirely unique contrast with
the; usual cohcern;over the reshaping of the flushing: skating ;-finks
Avoidance of complying with the United States law necessitat¬
and - landscaping arrangements 'ia the diatribe / against; the/ plans for
Fi
ing Senate confirmation of appointments to international committees,
the housing development for use by the members of the secretariat,
has been accomplished in the following manner:
uttered by Philip L. Goodwin, Chairman of the Architecture Com¬ Harold Singer to Staff
(1) By calling them commissions instead of committees.
mittee of the Museum of Modern Art.
According to his letter to ';PORTLAND, ORE.—Harold I.
v.
(2) By making the appointments not as Government represen¬
Singer has been added to the staff
the editor of the New York "Times":
"
tatives, but pursuant to the personal capacities of the individuals.
of Field & Co., Inc., U, S. Bank
"If Americans have so far mismanaged their welcome to the
Press Relations
'Hope of the World' politically and hospitably, this architectural Building, it is announced, He will
gestions
Circumventing the U. S. Senate
W;
There
has
been
complaint
some
bers that their statements
accounts.
have
been
by
some
the
Commission
misrepresented in daily
A leading member of the Economic Commission
has
mem¬
press
com¬
plained that the official release by the Press Office similarly garbled
of
statements
The
correct.
should
be
This sets
and
that
at
least
official
documents
should
be
proposal is
hence being considered. that all releases
by their respective Commission before release.
dangerous precedent in conference procedure, in giving
O.
a
his.
IC'd
the virtual right to recast or delete their statements
subsequent' reflection.
Besides it will not prevent corre¬
participants
after
spondents from writing their own versions at meetings, which
open
are
to them, nor from getting such versions at second hand in the
will
complete the
picture of disharmony and insin¬
It is false and bad American Colonial, presumably hous¬
up-to-date mechanized interior,
It ' has not the quality
even the poorest housing project
in the average American city.
offer these shams to a group of people accustomed to old things
design
cerity.
ing an
of
To
that
are
fine, and new ones that are honest and contemporary, .would
only one more hail in the coffin of the indispensable UN."
not a "nail in the coffin" of Secretary General Lie, who is
seem to be
But
the
individual charged with the responsibility -for all site arrange¬
ments for UN!
For his Norwegian humor and equanimity of dis¬
have been conclusively proved as absolutely irrepressible
midst all the tough going encountered by him.
position
_
_
_
___
handle
is
the
many
the
investment
of
son
years
Singer
He.
for
Sergeant-at-Arms at '
of
House
accounts.;
Joseph
Representatives
at
Salem, Ore., as well as chief door¬
keeper in the United States Senate
in Washington, D. C.
He recently,
service
from
returned
with
the
the office of the fiscal
director, finance department, in
the India-Burma theater at New
army
in
„
Delhi.
.
„
-
\
Volume 163
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4490
U N and Big
that concessions will be made by
all sides. r:v/%44 i1'?
Business
This, I feel, should be added: ■ *'
In the period between the last
(Continued from page 2640)
we
try: to be broadminded,. We
have only one prejudice, if you
r
OUr first duty as international
public servants, is- ta try to: be
fair-minded.
}
r
Now, at the risk of boring you,
I .would
like
.
About
_
the
to
to war.
Today the world is in a state of
economic and social dislocation
,
and resolutions
What we clearly need, in order
to prevent this situation from en¬
dangering Peace, is rapid eco¬
nomic reconstruction.
This must
be followed by continued, pro¬
economic
gressive
At least recommendations
taken.
and degradation.
/
<
were
same
recommendations.: and resolutions
stayed
on paper.
The situation which faces the
.
purely advisory.
are
nations today cannot be solved by
mere resolutions.
Action Needed
Morgan Stanley & Co.
member states of the United Na¬
tions,
but
for
is
it
the member
these rec¬
Offers Debentures of
states themselves to put
ommendations into- effect.
It is clear in advance that many
suggested by
measures
the
Eco¬
Standard Oil (N. J.)
An
investment
banking group,
nomic and Social Council will in¬
headed by Morgan
volve sacrifices by individual na¬
tions.
The machine will work
made
willing
are
to make the sacrifices;,
v
v
^
due
enlightened
opinion
in
every
country.
It will especially; heed
the-, support of people- like your¬
funds
Our
identical
true
and
interests
will
it
be
are
worth
1971,
15-,
May
accrued
,
Stanley & Co.,
public offering May 15 of
$85,000,000 Standard Oil Co. (New
Jersey) 25-year 2%% debentures,
a
Here-; the Economic and Social
Council will need the support of
selves.
■ ■
It
make recommendations to the
can
only if those nations
adopted.;
Yet, as we? know, those
:
development pious hopes and
Social
and
Economic
economic
conferences took
place.
Serious
discussions took place between the
leading' economists of the world
and
important
decisions
were
Aggressive foreign policies lead
something throughout the world.
say
international
portant
riv\
tan call
it; that: .We have a deepSeated
prejudice
against
War,
Poverty and Oppression.
/ Otherwise we are determined
pot to indulge in prejudice even
When art absence: of prejudice } is
itself interpreted as prejudice.
two wars a number of very im¬
cies naturally lead to aggressive
TPavai
"OrwH/ii
J'&Jk'.&i'
''SrM.Vi'1;','vvZ/Y.' bii
Foreign Policies.
powers
2683
and
98%
at
interest.
with other
will be
applied to the redemption, on or
about June 14, 194r3, of $85,0C0,000 principal amount of 25-year
3% debentures, due June 1, 1961,
of the company, at 101% and ac¬
together
Proceeds,
of
the-
company,
We} need an expanding world
program which I have already
Of. course we must meet, to¬ many sacrifices to guard them.
; economy, with steady employment
crued interest.
tnentioned.
Because of the importance of
and a
large, steady volume of gether and make resolutions. But
It does no.t seem to be under¬
,4 The new debentures are re¬
the day has come when the agree- this constructive* work. I ask you
trade between the nations.
at
stood as clearly as it should that,
to pay close attention to. the; pro¬ deemable, in whole or part,
Unless we can obtain this eco¬ ; ments which we. reach at confer¬
in attempting to maintain peace,
prices ranging from 101% to 100%
ences
must be- applied.
If the ceedings, of the Economic and and accrued interest. 4/
4 the United Nations organization is nomic revival and do so promptly world really wants economic pros- Social Council during its coming
we are bound to have an uneasy
Primarily a holding company,
session and1 in the future.
embarking on a long-range. Ecoperity-r-if the worlds wanta true
Standard Oil Co.
(New Jersey)
peace.
We have no time to lose.
; nomic and Social program for. the
I have said
before, and I wish
peace -4 the results and conclu?Since
to repeat now, that I find the was, incorporated in 1882..
/ improvement of living conditions
sions
of international meetings
The Economic and Social
June 30, 1944, the - company has
,/ali over the world*
forces
in
favor of Peace and
Functions
must be
t:
put into practice every¬
...
In drawing up this,
program} we
guided by the belief that
Peace and Prosperity go together
;
are
and that Economic distress is one
©f the roots of war.
Under
You, in this country, know how
;
hard it is for
pie to
a
comfortable peo-
from normal life to
turn
fhe terrible job of making war.
We have all seen how easy.it
has been for demagogues to build
up hatred and the lust for war
among people who are made . des¬
perate by economic troubles.
It would be foolish to say that
.:
*
(economic distress, is the sole cause
of war, but it creates the atmosphere in which war can be made.
If
find
cannot
workers
and
;
liker Hitler and Mussolini can
rest.%M:#,:'-'
•
So, in .attempting to prevent
war, we are bound to pour all of
our energy into a drive against
economic and social misery.
Since, the United Nations came
to New
York City, attention has
the work of
been concentrated on
the
Under
because it was the only
Council which was working, and
because the Big Powers
issues.
.
■;} 0*
-
' '44 S
found it
dramatic
» ...
Public's Overemphasis on
Charter
the
the
execu¬
Political
cooperation,
known.
never
The Coming Conference on
victors
the
equal to the increased volume pf
trade which they could gain un¬
der a system of cooperation. ;
This Council has a number of
Commissions under it and has di¬
rect relations with the Special¬
Trade
.
and Employment
One of the first, positive steps
.
of the Economic and Social Coun¬
Agencies.
These- include,
cil will be to summon an Interna*?
among other important agencies,
tional Conference on Trade and
the" h^eirnational Bank, the- In¬
Employment.
ternational Monetary Fund and
This conference will deal with the Food and Agriculture Organ¬
many factors which today serve to ization.
^
•,
' W hhamper the flow of goods through¬
The Economic and Social Coun¬
out
the
world
concern
and
it will
ized;
of
be
cil has three kinds of powers: }
to all of you,
recommenda¬
It must carry out
The conference has been called
tions of the General Assembly in
promote the expansion of pro¬
duction* ' and the exchange and
the Social and Economic fields and
consumption of goods;:
sembly.
to
make regular reports, to
Its agenda will probably include
the
the As¬
following subjects:
can
conventions and call conferences.
The achievement and the main¬
Finally it is expected to consult
.At the samC time this concen¬ tenance of high and stable levels
tration on the Security Council of employment and economic ac¬
tivity. } }■;.:'
^ } 4"
may have led some people to think
with
a
large: number of private,
national and international organ¬
the
of the Specialized Agencies
to
and
izations^
coordinate;
strong at this time
ability of another great conflict
in the foreseeable future.
We
must
take
full advantage
this chance to reduce
inate
factors
or
which,
to
of
elim¬
otherwise,
might later lead to violence.
This
is
repeat
our
that
honorable
shall
we
task.
need
I
and
owned
operated
the
ocean¬
going tankers and incidental ma¬
rine properties
formerly owned
Standard - Oil
Its subside
its. subsidiary,
by
Co.
So, while we must remain on
guard against violations of the
Peace, we are promised a period
during which we can devote our
energy to this constructive work.
New
of
Jersey.,
iaries and companies in which. it*
has investments.; are engaged in
~
production,, refining, transporta¬
tion^ buying; and selling of petrol-;
eum
products
retail.
wholesale
at.
subsidiaries
Certain
arid
are
actively - engaged; iw exploratory
and development work in an ef¬
fort to add to reserves against fu¬
ture needs.;
Z /■
■
-
the
Approximately 53 % of the com¬
loyal support of every enlight¬ pany's $1,137,441,311 investment/
ened person.
after reserves for depreciation,
depletion and amortization, repre¬
sents t operated
and unoperated/:
acreage and facilities for oil pro-?
duction or exploration.. About 9%
represents oil pipe; lines, 6% mar.
rine
equipment,
19% refinery,
CLEVELAND, OHIO — Forma¬
properties, 12% marketing prop-/;
tion of Skall, Joseph and Miller
erties and 1% miscellaneous.,
-. }
.
Skall, Joseph & Miller
Forming in Cleveland
,
conduct
to
a
general
investment
During the war/ the Company
and
subsidiaries provided more
business,, with offices at 1640 Un¬
ion Commerce Building,
Cleve¬
petroleum products to the armed
land/ is announced by David, G.
:forces/pfZthe^^ Uitided: Statedtl^
Skall, Herman B. Joseph and Les¬
any othefc'oil company/: andr thej%
ter I. Miller. At the same time the
dissolution of Joseph & Co.,
announced.
•
Inc.,
were
collectively the^^largest pro->
ducer in the world of
106 octane
was
All of the partners in the new
firm have long been prominent in
Cleveland
also report on its own
initiative and it can prepare draft
It
so
that I cannot believe in the. prob¬
fatal
this
in
could
only
be
losers.
Nothing they could gain would be
Council.
.
Functions
*
game
broad policy is en¬
tion of this
natural
hard to agree on several
have
we
Even
trusted to the Economic and Social
Council.. This was direct
Security
which
pledged to promote:
problems."
then
the
that
Failure to cooperate will give us
"Higher standards of living, full
nothing but chaos; Different, eco¬
employment and conditions of nomic
systems will push and pull
economic and social progress and
at. each other in a desperate at¬
development" and
tempt to secure a greater propor¬
"Solutions of international eco¬ tion
of the decreasing commerce
nomic, social, health and related of the world.
paen
do
the
55
believe
through machinery set up by the
United Nations, can bring us a
United degree of economic prosperity
jobs,
businessmen face bankruptcy
investors lose their savings,
Article
Nations are
,
'■
I
tions lays heavy emphasis on the
Economic and Social functions of
the organization.
against War
where.
The Charter of the United Na¬
financial.,circles.
Mr.
Skall, who served three years with
the Army Air Forces and held the
rank of. Lieutenant. Colonel, was
President of the Cleveland
Stock
Exchange in 1942 and for several
years was a
member of Its board
gasoline and of synthetic toluene
for explosives.. They/were? among:;
the largest 3ptoducer^}bf: the :raw/;
materials for synthetic rubber and
also; produced substantial quanti-;
ties of industrial alcohol,,-butyl
other important war
In addition/ the com-/,
pany developed a fluid catalytic
cracking process which was
rubber
and
materials.'
-
governors. From 1928 to 1942
widely used by,the industry and/;
organiza¬
Restrictions and discriminations work
he conducted the firm of David G.
a
substantial portion of alt 100
tion was devoted to pure politics.
against International Trade.
m its own field.
Skall & Co.
octane gasoline and of the b.uty-;
Restrictive business practices.
I hope that the meeting of the
The Ecpnomic and Social Coun¬
For the past thirteen years Mr. lenes necessary for the production
International commodity agree¬ cil will
Economic
and
Social Council
rely oh the cooperation
Joseph has been President of Jos¬ of the butadiene used in synthetic
which begins here in New York ments diul the establishment of ail and assistance of these. Specialized
eph & Co.,, Inc., investment house, rubber was made by this process/.
later this month will attract just International Trade Organization Agencies in carrying out many of
specializing in bank and insurance
Severe war damages were? suf¬
as
a
Specialized Agency of the
that the United Nations
much attention to"
as
the construc¬
tive, long-range work
have already mentioned.
In
my
which I
opinion the role of the
Cpuhcili and
its allied organizations* te just as
important as the work of the Se¬
Economic' and Social
curity Council.
•
•
its most important tasks.
United Nations.
help
expected
to
Coupcil
The outcome of this Conference
and
Willi?® of the greatest importance Council
in deciding whether-we are going
to have the revival of normal
own
trade which we. desire and need.
and
Trusteeship
the
On matters
It is also
Security
concerning its
field.
The way
At the moment trade between
the
in which the Economic
works
Council
Social
.
the nations is
the
hampered of some¬
instrument
times made impossible altogether organization works.
like the Security Council which
by the restrictive systems now'in
In the first place,
can use force against an aggressor.
use.
'
■
It is vital to, have an
It is
just as important to- have
instrument or a collection of
in struments to < fight the^ factdrs
an
which may
In
restore
to
sound world economy we
,
that the
tariffs,
quotas,
embargos
restrictions
all
act
tinuous
against the exchange of goods.
lead to aggression.
attempt
our
High
and financial
a
realize
nations, today, are" rhdre
that these
,
improvement /in
social
conditions
measures
real Peace.
took forward hopefully to a period
dependent upon each other, eco*
of greater, tranquility' and greater
nomically and socially, than they
demand.
have ever beeri before.■- s ; *•. ■:
This is something we must all
realize and remember.
We have
no
Under these
time to lose because the situa¬
conditions there is
Prosperity, like Peace, is indi¬
tion is so difficult, some say des¬
no valid reason why the nations
visible.
One part of the world
'/
of the world should not be able to perate.
cannot- enjoy durable economic
In the second place, the way in
welfare if the other sections of the commence the relaxation, of bar¬
which the Economic and Social
J
world 'suffer from poverty, and riers.
Council works will serve to show
In doing so every country will to what extent the nations of the
depression.
i The restriction of international be doing itself a good turn, bply world are able to cooperate on
trade not only prevents the nor¬ by relaxing its own regulations practical, peacetime questions. mal development of international will, one country make, it possible
.''
-
relations.
It
is
bound to
lead to
economic 1 policies by
all of the nations of- the world.
aggressive
These aggressive
economic poli-
for others to do the
offers
/ The Council's Powers Are
same.
This: Trade Conference,
golden opportunity for all
nations to. come together. • I hope
a
:
X feel, I
I
/
Advisory
no
executive
subsidiaries'
parts
*
properties'
of Europe and;
.
committees.
Mr.
of
Miller
African countries.
has been secretary
Joseph & Co., Inc., which he
/ y.
/
,
Consolidated gross operating: income
■
in 1945 amounted to. $1,618,-
hhs/been vice president of the; 075,125 compared with ; $1,638,-/
706,158' In 1044. Net profit, before
Superior Foundry Co;;,
Skall, Joseph and Miller, with' interest and income and excess}
membership
in
the
Cleveland profits; taxes: ih 1945,, Amounted tp,"
Stock Exchange, will handle listed
$230,203,653 compared with $27.9,brokerage business un well as; ex¬
503,043 in 1944.
panding the activities formerly
carried on by Joseph & Co., Inc.
It is also understood that a fur¬
ther expansion of the firm's busi¬
power.
ness
is contemplated.
Also with the
new
firm will be
Wagner, Eidlinl Go.
To Open in Rochester
E.
Harris,} previously
ROCHESTER,. N. Y. — Wagner,
vice-president of Joseph & Co., Eidlin & Co., a new New York
Inc., and Will F. Metzenbaum//4
Stock
Exchange
firm, will be
Herbert
Leo M. Bemstem & Co.
WASHINGTON, D. C.—Leo M.
Bernstein & Co.,
in
a
Inc., will engage
securities business
from
of¬
fices at 1415 K Street, N., W.. Offi¬
cers
are
Leo M. Bernstein, Presi¬
dent; Walter
..
The Economic and. Social Coun¬
cil has,
by
many
Bond
he
throughout the world
will decide, to
a
large extent,
were taken tmdeh the pressureof
abnormal conditions. But now we whether we are going to have a
We- know
fered
in
.Club of, Cleveland in, North Africa.
Operations have
I93& and has served oh various' been resumed oh a limited
scale;
Investment Bankers
Association in
most
European
and North
the
joined in 1936 and for many years
as I have
pointed out, its success in restor¬
ing economic
stability and in
bringing about, a radical and con¬
'
company stocks and general mar¬
ket securities. He was President of
will
way
in
Which the whole United Nations
determine
largely
of
Miller,
23rd.
Rochester
in
:/.•
*
as
of
May
Partners of the firm, which
will be located in the Union Trust
will
Building,
be
Lawrence
J.
Wagner, James Mazin,: and Berthold M. Eidlin who will
Vice-Presi¬
dent; and Norman Bernstein, Sec¬
Its retary-Treasurer-
formed
acquire the
Exchange, membership of John B.
'Moriarty.
.
THE COMMERCIAL & FINANCIAL CHRONICLE
2684
T
offset the
deposit losses which
be brought about by "the
Treasury's
debt * retirement
Government Securities and Commercial Banks
:
(Continued froni page 2642)
b. In the third they were ex¬
cluded
v.
.
entirely,
c.7, In
"
remaining five
allowed only
the
very
on
a
d. This indirect
chases
limited participation, based
percentage of their time
%
77-J
via
first
open
in
form
took
.
,
v
;
£tors.
•
Cooperation of Federal Reserve
the
between
tion
credit not
-
institutions
their
close of the Drive
protecting the
pattern of rates.
was
national debt
are
b.
•
»
has
open
way
i
concept of the functions of a
central" bank
/
V
j
consideration
is. an
in
important
appraisal
of the probable^future level of
the Government securities marany
44%
4945 7
pattern
discounts,—seems
10. My
as
will stabilize
resulted in
an
Demand deposits grew, from
about^$10.^
deposits-from
over
bil¬
$27 billion?
f. Put another way, the vol¬
ume
of credit' extended* ?was
'
will
5. Until
about
purpose
the
rate pattern Was pretty well main¬
tained along the lines of % % for
Bills, % % for Certificates, 2 % for
8-10-Year
Bank-eligible
Bonds
and 2% % for long term ineligia
year
ago
.
]
I
j
-
expanded from about $2^ billion to about $25 billion—part
of which was, of course, necessary to offset the enormous inin money
'
crease
1
serves, the
the
necessary
the
and
long term
rates if the banks began to sell
their Bills and buy the inter¬
mediates and long terms.
Analyzed
I
think
cline,
held
on
it
is
,
;
ship."
.
^
.
this
basis—
By June 1947 possibly as
mpch as $18 billion of cthe tpub¬
licly held debt7will be retired,
the
correct
bpt in relation ita jthe, deposit
^
to prevent
yields from going still
lower if the Bill and Certificate
rates
:
-the
are to
be pegged and if at
same: time the banking sys*
be
or
be
can
:
of
de¬
estimated
able "losses resulting from
e.,
that
experienced
relatively
greater gains from war-time ac*
tivities will be the larger losers
and that over-all there may be
77
banks
and
new
or
any
increase in loans
discounts
deposits,
will
thus
result
in
tending
to
and
Central
Reserve
At the outset of my
13.
remarks
evolutionary
changes which have taken place in
banking during recent years. One
of the changes to which I had
reference was the growth of de¬
posits brought ObOut by bank pur*
referred
I
chases
As I
of
the
to
securities.
Government
it, we can look forward
With relative certainty to a level
see
of what this may amount to may
of
be. obtained from considering the
exclusive of War Loan balances,
relative
gains
Unfortunately,
of recent years.
the latest" data
20;
Nevertheless,
1945.
think
I
this may throw some light on the
problem, especially as the data are
for
demand
deposits
adjusted
which
excludes
inter-bank
deposits around present levels,
and
continued heavy holdings
securities. While
to
Government
of
some
crease
banks may be able to in¬
loans and discounts and
income
thus be less dependent on
securities
Government
from
the
outlook for the banking system as
whole
a
for
is
continued
heavy
bal¬ holdings of Government securities.
Ac¬ As a practical matter the Treasury
adjustment will have 4o look to the banks as
Is iiof riiecessary for War Loap more or less permanent holders of
balances which I think we are a large proportion of the Federal
ances
as
counts
well
and
as
War Loan
therefore
debt while the banks will have tcr
agreed will be lost.
From
a.
6/30/39
demand deposits
to
3/20/45
adjusted of all
hold the debt to keep
The
b.
increase
a. Only
gradually can the
Treasury retire bank-held debt
or shift such debt to non-bank
.
for
country
member banks was 233%; Re^serve City member banks 184%;
and Central Reserve City mem¬
investors.
the
present
almost im¬
possible to conceive of a demand
b. Considering
c. For the Kansas City' District the over-all increase was
201%
against the national
erage/of 159%,;
d.
av-
for
age
,
,
average
Cities of 184%.
e.
Looked
member
banks
each
other,f.7;,ri7
against the
for Reserve
of June 30, 1939, and 4.6% as
'7'7:-'^ ;7
recent study of de-?
f
of
very
certain factors in¬
be kept in mind
constantly.
a.
We
have
a
debt of about;
$275 billion and at 2% the an¬
nual interest cost alone would!
be over $5
more
New York district accounted for
more
rates,-—matters
should
volved
trict gained from 7.7% to 11.8%
of the total while "banks in the
6/30/39,
A.
then, brings up the
of debt management and
thought that
banks in the San Francisco dis¬
:'-:r f;sA
OH.
great importance to banking, Int
considering this problem, it is my
20, 1945; in contrast to
relative gain,
only 30.8% of the over-all. total
at
3/20/45 against 39.3%
at
7'v
This,
interest
way,
Kansas
7 City district accounted for 4%
of all demand deposits adjusted
as
14.
matter
the
and
dependent
Interest Rates
,
in
are
Debt Management and
another
at
banks
suffi¬
any
Xnv brief, the Treasury
c,
for country banks of 233%;
City member banks
gained only 165%
cause
the
Reserve
7 national
discounts
and
appreciable
liquidation of bank-held debt to
7 meet loan demands.
r
above-average
in¬
due
entirely to
I country banks whose gain was
77 246% against the national aver¬
was
loans
cient to
This
crease
•
level of deposits it is
ber banks 92%.
'
their funds
employed and earn some income.
member^bapka. increased 159%;
of March
any , shifting of
non-banfes-held" debt
to
the
a tendency for ^deposits to shift
from; country banks to Reserve
Cities.
this only nominal
| c. Moreover,
the shift of deposits as
War Loan
withdrawals, I think it reason¬
able to assume that those areas
Cities
Treasury
by
;
In
less resulting from
much
through
loss
the
bank
posits, occasioned
sultant
riod-of time.
Moreover, there is nothing
b.
1
distinguished from the deposit
UrFronr the standpoint of' the
gains
of recent years the re¬
deposit losses will be
relatively small although occuring within a rather brief pe¬
f.
will
loss
'
by shifting
vestors,
shift¬
some
or
bank-held debt to non-bank in*
through the War Loan
over-all
-
7,
b.
steadily declining yields.
re¬
banking system gave
done to maintain
intermediate
a7
debt up to over $275 billion in
such a short time and do so at
fianacing needs.
Given
debt.
but to ' the extent debt
by non-bank .investors; is
retired the only over-all. result
Will, he a shift in deposit owner-
analysis—there is no great mys¬
tery as to how we could run our
in circulation.
,
c.
balance
To the extent bank-held
dCbt is retired deposits will de¬
e.
the announced policy of the
System of making available to
the banks adequate reserves for
wartime
retire
working
d. Thus, if the Federal main¬
tained adequate reserves and
and
b. This extension of Federal
Reserve credit was in line with
|
to
.7.
could be
„
a. In
maintaining the rate pat' fern Federal Reserve credit was
of buying 2s.
cessively large
pegged the Bill and Certificate
rates, there was not much that
-
Jbles.
:
for the
be
b. There will be
.,
Bills
a
about $50- billion-at the- end pf
which Irihave covers the/ period
1941 to over $100 billion; time
from June 30,1939, only to March
lion to
bank-held debt
de¬
increase in
,
or
so
■
deposits and ixion^i^jbreEila^:
e.
system only by reversing
7
process by which they were
created, — that is, by retiring
tend to increase.
or
>
ing
the
.Uclhe; major loss of deposits
;•
r
purchase of shifts,-—i.
may
of Certificates
or
For the next 12 months
'
7
as soon
deposit
deposits which are
not lost to the banking system as
billion. a whole but which may be lost to
d.
The expansion of credit of
"the individual bank. Some idea
course
financed /the
about $6.2
:
•
present working balance deposits
Reserve withdrawals
banks through loans on securi¬
.
a. There will be no wholesale
over-all loss of deposits for the
simple reason that these de*
posits can be lost to the bank*
7
loss of Treasury balances.
*
Rate Pattern
thought is that
the Treasury has exhausted its
$67'billion of Gov¬ individual
thef; Federal
7
of the country to other areas.
likely.
more
Probable Future Rise in Deposits
,41%
more
than the entire quoted
change, in the " rate
7 worth of all securities listed on
,be attributed, I
the New York Stock Exchange
4. As you are well aware, the
think, to the Federal's policy of
wartime pattern of rates was %% J maintaining adequate reserves 7 vT^Whale^Eaton;^-'
and as long as the Bill and Cer¬
for Bills, %% for Certificates, 2%
7 8,
^This increase ^ in7 bank de^
tificate rates were left at %%
for 8-10-Year bank-eligible Bonds
posits an money in Circulation
and %%, respectively, I don't
and 2^% for long terra ineligible
was, of course, the direct
resultJp
know of anything the Federal bank
Bonds.
absorption of Governnrant
could have done to prevent the debt.
wri/ a. All in all, the rates were
change and at the same time
a. As loans
and investments
jr.; satisfactory and in line with the
have maintained adequate re¬
are increased, in this case I in-r
i 7 yield pattern which had existed
serves.
! in a rough way for quite some
vestments,^.-dJe p 0 s i t s and/or
c. To maintain
adequate re¬
1 time-- a pattern, incidentally;
money in circulation go up likeserves the Federal had to stand
L based on the assumption that
7; ready
to
buy whatever the
] low rates could not exist indefi¬
banks had to sell; moreover the
Prospective Decline in Deposits
nitely and therefore reflecting
Federal could not, in a free
1 the buyers' preference for short
9. For the immediate fikure~a
:
market; differentiate between deposit loss is indicated for as you
term securities.
7 sales made for the purpose of
know^jthe Treasury has embarked
I Effect of Maintaining Interest
replenishing reserves and sales upon a policy of using its ex¬
.•
a
ex¬
Banks about^215 Jbillion, while vfrjth reasonable accuracy; the dif¬
in
addition Lthe "comiftercial ficulty lies 7 in estimating prob¬
ties
about
b. This
44%
-
The commercial, banks ab¬
period,
/
2.31%—yields which,
incidentally, contrast with those
obtainable only a few weeks
ago of less than .95% for !%s,
:/ about 1.22%
for Treasury 2s,
and only 2.11% for Victory 2%s.
market operations; to my
of thinking, this changed
or
credit
ing of deposits but 7 the major
ernment securities in the 4-year
of
1:
debt;
bank
through loans and discounts, whereas the reverse,—
that is, an increase in loans and
-
1944
.
withdrawals and that at the same
time and probably for a somewhat
longer period a shift in deposits
from certain localities and
sections
account.
1943
sorbed about
taken
to
available through reinstead of through
of
very
retire¬
tended
the percentages
By years
50%
in the
f discounts
bank-held
of
contraction
a
nominal
and
$213^R-- I7thinkv they should level off
About 45% of the
1942
of 1950 are
to protect the pattern
of
Shifts in Deposits
posits should decline but after that
Were as follows:
by enormous pro¬
so at
Indicative
which
at best only
mean
ment
Reserve Banks;
c.
1
serves
expansion
directly, or indirectly 'through"
the banks, including^tHe Federal
have wit¬
the
change
place in the
rate pattern is the fact that l%s
a.
entirely different role
during World
7: of interest rates and made re-
\
enormous:
an
a.
Pattern
we
can
which
but
lion increase irfour debt in the gggin j?egin to grow but at
period 1942-1945 was" financed reduced7* rate of growth.
?;
in
selling to yield about
1.14%, Dec. 2s of 1952/54 to
yield about71.40% and Eighth
War Loan 2%s have gained in
price so as to reduce the yield
| liability
the fact is that there
bank credit.
of portions and of having done
steadily declining rates.
as-
War I; during World War I the
Federal assumed little, if any,
with
in financing the
minimum reliance on
success
bank credit
position of having increased our
77v from that assumed
i
Rate
Thus, today
and in protecting the pattern
an
lack of
or
,
my
sorb ; the debtjncrease not/taken
since the
we
in
gradual
Never-,
Without
considering the Treasury's success
against
1
,
.on
by non-bank investors.
>233%
was
>
"
theless, it was. necessary, as it
always is in time oLwar,-to rely
upon the banking system ta ab¬
repetition of what took
a
Change in
6.
In
sumed
reliance,
commercial bank credit.
place a year ago in the eligible
category—that is, a scramble for
2V2S of such proportions as to
alter the pattern of rates at the
extreme end: of the yield curve.
.
?
limited
purchases and
nessed
To
J interest rates the Federal
minimum
with
gain
/o.,
which is not
12. The situation with
respect
opinion; a bal- to
deposits, as I see it, is that for
aiiced budget and retirement of
the immediate future we will
have
; bank-held
debt,
which now a loss occasioned
by War Loaii *
7 seems in
earlier, it was our
policy. to; finance the
announced
the
290
investors,
likely
Expansion of Money and Deposits
Govern¬
they needed for
were
bank
prospect
war
t
Any further deposit losses
will then depend upon a shiftring of bank-held debt to non-
v
Drive in¬
companies and savings
surance
'
•■■■
all the
be: anticipated.
7 7 e.
u
h. But in the Eighth
at low and
This co¬
undertaking to provide
the banks with adequate
reserves
for wartime financing
to obtain
were
the long term rate stayed pretty
close to a 2V2% basis.
provide the banks with
adequate reserves for wartime
financing purposes; and
c.
apparently
ment securities
operation
will
continue,". 7 In
cooperating with the Treasury, the
Federal Reserve System under¬
took to do two. things, namely:
b. To assist in
of deposits and money in circulation
7 which was a concomitant de:
velopment of financing such a
large volume of the debt in¬
crease through our; banking sys¬
tem.
7?; V~77.7^..
age of 158%; for Reserve Cities
7 the
gain was 174% against the
national gain for Reserve Cities V
7 of 7 170 %;
for country - banks
stable level of deposits
more
may
it would be well to
consider, the, expansion
war
stable rates of interest.
;
bank investors
able
.
sible to finance the most expen¬
a.
Until rather recently non-
g.
wartime coopera¬
the Treasury and
in history
usual
Drive
bankadded
for intermediate securities.
ence
I think
7. As stated
5^-
impetus to this growing prefer¬
"Close
wartime cooperation between the
Treasury Department and Federal
Reserve System has made it pos¬
war
from
a
lVz% bond for the
72% bond in the Seventh
; and the elimination of a
eligible from the Eighth
year
Federal Reserve System:.
sive
away
f., The substitution of
supplied by non-bank investors,
<the; Treasury received the whole¬
hearted support of the Federal Re¬
serve System.
The President in
bis Budget and State of the Union
message had this to say with ref¬
to
so
the non-bank investors.
the commercial
bank system supply the
erence
buyer of Certificates while the
commercial
banks
began
to
| drain the 2% bonds
and Banks
,
Z. In looking to
7
a
1
1
trict against a nation-wide aver*
and once this is exhausted
ance
5
period from
6/30/39
to
6/30/45 for banks in this dis*
Treasury's present working bal¬
I should like to followthis
point further but before doing
■
during
the
ture the over-all loss should be
considerably
less ; than
the
g.
,.
x
eludes both War Loan and inter*
bank balances, was: 194%
7.;-;,: ■
7
.■
indicated for the immediate fu¬
vestors.
the
of heavy Certificate purchases and a tendency to let the
Federal have the Bills; :7 * ;■?
■■
d. Although deposit losses are
:
support of the
market pur- ; rities; away from :npn^bank in¬
Notwithstanding the limi-?
tations placed on direct finance. In due course, income con¬
(Ing through the banking system
siderations" combined
With -a
and the efforts to place securi¬
,f growing confidence in the rate
ties with non-bank
investors,
structure produced a preference
the Treasury did look to the
for the 2% bonds with the result
banks to absorb the securities
that the Federal became a major
not taken by non-bank rinvesd.
;
with'the
;;'
program.
to. permit the
system to continue to add to its
7 securities holdings — doing so,
incidentally, by draining secu-
way
posits made by the Kansas City
Federal shows that the over-all
gain for all deposits, which in«*
will
necessary reserves
which, of course, led to an expansion of bank deposits.
Drives
''
deposits.
support to; the Drives
through open market purchases
.
drives they were
tern is to be supplied
indirect
Thursday, May 16, 1946}
/
billion; this alone is;
spent not so>
than what we
for all activitiesgovernment.
many years ago
.
of Federal
7
b; From
this
standpoint thei
'Treasury naturally is
interested
IVolume 163
Number 4490
THE COMMERCIAL & FINANCIAL CHRONICLE
in ;7.
i^aintainingi;-,;;low::'finterest
rates.^
.
In
c.
Nr.
Peoria
Vinson
the
last
September,
stated
burden
that
rates
of
the
debt
level of interest rates
■j
$ rates from going down.
V>
were
higher";
reiterated
report to
Views
his
recent
Congress.
'
d. In
commenting
bank-held
had
these
in
debt
this to
the
on
the
President
in his budget
say
From
c.
increase bank
bank
funds, continuance of the
present low rates of interest is
pense
entirely
rates
It
to
seems
therefore
me
a"
cheap-money policy, :a
thought which is supported by
public statements of responsible
officials
well
as
hand
other
it
the
over
is
quite concerned
are
continued
decline
in
'
interest rates and monetization
of
the
In
debt.
"Washington
January
a
dispatch
29
is the vast accumulation of
the
of
fact
the
that
•
far
To
bond
too
less
as
maintain
prices and interest
which effective
to
be
through purchase of
Government
land
all
the
that
so
rate of
would
investment
return
reflect
supply of savings and
ment funds
in relation
on
bank credit
the
ures
to check further unneces¬
sary
18.
the
,
-
.
15.
more
As
or
I
:
it the
Federal
is
time
of
pattern
%%,
expenditures
estimated
%%, 2%
much op¬
with
and
long; this
.
j
a.
Through
open
-
the meantime, it
mean
receipts under¬
the deficit for the
j
erations the Federal has the
ability to maintain a rate structure no higher than the war-
i
time
|
i
,
{
pattern; "The Guaranty
Survey" of last September estimated that reserves - could be
made available sufficient to ex-
of cash
expenditures.
receipts
c.
As
rather
the
;
;
•
upon
a
: >
result
..
fortuitous
of
no
the
:
can
to imply that
,
20.
the
as
the
higher rates.
we
did
y
and conclusions may
two
'
circumstances
V
a.
Loan balances
will
ment and
.
Rhoades
&
;yCo._; and
Sachs & Co.
r
Goldman,
Other teams in
league
include
remus;
\ Harris, - Upham
Hirsch
&
DeCoppet
Co.;
v
the?
& Do~
& > Co.;
Lynch,
Merrill
Pierce, Fc*.1ner & Beane; Orvfc
Bros.; and Securities Traders of
y
New York.
The league is divided, into two
% of y-six
'teams,
the
divisions
;
r
be in order:
year
be
War
reduced
debt retirement and to the ex¬
to
a
•
thing to be afraid of; the Fed¬
eral is committed to a cheap
money policy,—not necessarily
as cheap as the rates prevailing
only recently, but still cheap
money.
Until the program of
debt retirement was adopted
years^y
It is
possible, according to offi¬
cials of the Wall Street A. A., that
'/
post-season games may be sched¬
uled for the winning team to meet
the champions of "similar' leagues
in other leading cities of the coumtry, as; was the practice prior to
the
war.
':-?/,
Bljfii 0 Go. Offers
Union El. of Mo. Ptd.
An underwriting group headed
by Blyth & Co., Inc. offered/Id y|
the
public ' on May 14 130,0001
shares of Union Electric Co. of*
_
Missouri preferred stock $3.50 se^
ries (no par) at $107 per shares
The public
offering is subject to
exchange offer being made by
company
to holders of its 4
outstanding $5 preferred
stock ;
permitting such holders to ex- :
change for the new $3.50 series
preferred stock on a share fwr
the
share basis
Federal
was
more
or
less
a
plus $3 per share In
cash dividend ad just-
of 16 cents per share.
Ex¬
changes will be solicited by a na¬
tionwide group of dealers.
The
exchange; offer will expire on
May
20,
1946.
Bank & Trust
Mercantile
final
faced
analysis,
with
we
still
the problem
of
$250-$275 billion
debt at low cost; the Federal is
fully aware of this but is opa
i
Central Hanovrir
Co., New York and
Commerce
Bank
&
;
Trust
Co., St. Louis, are the exchange agents, with
either of
whom all $5 preferred stock to be
exchanged must be deposited be¬
fore the expiration date. Any $5
preferred stock not deposited for
powerless to stop the run-up of
prices, but now that it has re¬
gained some degree of control
over the market it will .be more
exchange will be redeemed on or
likely to use its powers toward
about June 24, 1946 at $110 a
stability of rates than. toward
1
producing -materially lower, share and accrued dividends.
Union Electric Co. of Missouri
prices.
serves
the
City of St. Louis
adjacent 'area.
Giving
■
y
;
/
; >
effect
to
the present refinancing, outstand¬
ing capitalization of the
company
and its subsidiaries will consist of
debt;
reduction will be occasioned by
necessity
•
•
requirements, and
differences ove,r the
of maintaining low
reserve
not in any
rates.•
Missouri and
ed
gross
subsidiaries report¬
operating
$52,584,000. *■'; r.\
1
and
any
differences
of $103,000,000 funded debt, 383,632
which may exist be- shares of
preferred stock and 2,tween
the Treasury and
the
695,000 shares of common stock
Federal
are,
in
my
opinion,
all
of which
is
owned by
the
based on the consequences of a
policy of cheap money under North American Co. For the year
our present' system of banking
1945 Union Electric Company of
'and
to, say, $3 billion; most of the
by the end of the 1947
,
opinion
correct, I
observations
has ^ embarked
of debt retire-
committed
are
'
Treasury
a
policy
at Croke
Van Cort-
change and the New York Stock
Exchange Association of Bond
Brokers; Carlisle & Jacquelin and
F. V. Foster; and Carl M. Loeb,
cash and
the
By June of next
near
an
posed to further monetization of
y
is
following
we
servicing
If my analysis of the prob¬
war
think
circuit begins
landt Park, with games scheduled
between the New York Curb E*-.
ment
are
be toward
defi¬
lems involved in having financed
over
it
we
operating under an econ¬
of managed money and
1. In
Conclusions
<
but
prices
yields should be
encouraging
development and not as some-
lower rates but very
nitely
••
these
are
the
may
new
evening
Field, 240th Street
looked upon as an
"
:'
future
k. The recent decline in
money policy
but has
defined cheap money; my
even
this
and improved
thought is that the Treasury is
likely to counterance rates
higher than; %% for Certifi¬
cates and 2^ % for, long term
fiscal year already has
cut from a January esti¬
excess
%.
level.
own
bonds; its views
an
threat
not
over-
budget, assuming no unantici¬
pated changes, should produce
market op-
immediate
the
should be remembered that
be
is'conjectural, but
current
■;
j. For the immediate future
the Treasury may be less inter¬
ested in bond prices than after
it has used up its working bal¬
ance; prices may drift lower for
the Treasury is committed to a
cheap
,
d
portfolios should be maintained
the Treasury is likely to coun¬
tenance materially higher rates;
posed to monetization of the debt
mate of $28,620 billion to about
through bank purchases of addi¬
tional Government securities; it is :^:$2l%>billion while the 1947
not necessarily committed to a > budget may prove to be in bal¬
rate structure as low as that now
ance; on a cash basis the 1947
\
source of in¬
for many years to come;
with this thought in mind,
hear
will
that
as
to prove a major
come
condition
are
bond
banking system
cheap money policy.
indications
5:30
before that
and for the great ma-
that
seek its
:
considera¬
so-called
omy
How
Play in the
at
six years as a
and
hard ball league.
jority of individual
allow the rest of the market to
place, Treas¬
were
one
into
banks iny eome from investments is likely
allowed
this
the
from
been
prevailing.
;
refund with Certificates at %%
and for all practical purposes
and
estimated;
a >whole
throughout
does
as
market, as
never
b. In the second
Structure no higher than the war¬
and 2Vz %, but is very
longer
to come; in
In the first place the Vic¬
ury
but
taken
well
as
i. For the
opinion did,
Treasury will not need to raise
considerable extent
to
as
profits.
.'any new money for some time
ments.
less committed to a rate
tion
for
the Federal
has been
Certificates
all
v<
tory Loan was over-sold, giving
the Treasury a working balance
; away and above likely require¬
Pattern
see
rate
is
come
not
money
a
f. I do not
a.
■
■
very
portfolios well distributed
structure
yields, there is
considerably less inducement to
lengthen maturities.
the change has been fortuitous but
none the less real.
{
{Committed to War Time Interest
a
•
the
Treasury
my
league
a
or
fShorts,who wUl play each Moi**
day evening, and the "LongsJ*
who will play Thursday evenings.
some cases it may be desirable
Every team will meet each other
to capitalize bond profits, but if team in its-own division for the
such a policy is followed I think diviison pennant.
At the close of
it should be prediqated on a the season, it is expected that the
substitution
of
income
from division leaders will play for the
other sources rather than on the Wall Street championshiD and the
premise that repurchases can Jules Bache trophy which has
be made at lower levels.
been awarded the ^winners hi the
Wall
Street
league for many
h. I see no reason to disturb
able at current
decided-turn for the bet¬
a
To
ter.
■
-
•
income
on
ball
as
an¬
active prior to
was
for five
war
association,
from Government securities; in
;
Heavy
e.
min¬
g. To the extent income from
loans can be increased; less re¬
than
rate
come
will continue
f
dependency
well as with Certificates obtain¬
be
Within the past few months
whole
fiscal
situation
has
taken
expansion of commercial
holdings of Government
securities.
to
thus
and
from investments.
changed
stated
new
time to
removed
Fiscal Situation Improved
increasing
the
any
lowered
and will be solved
V:
-*.v,
a
1.25%
d. No
along orthodox lines.
de¬
amount. 1 of
bank
credit; that the whole process
needs to be stopped, hot only
by bringing about a balanced
budget but also through meas¬
can
imize
loans
which
one
soft
the
The league is a revival
liance need be placed on income
that the Certificate rate
hoped that the problems arising
out of our financing entirely too
much of the war costs through
mand instead of reflecting an
bank
the market and it is
over
increase
:
the list.
which, incidentally, would
of
case
Reserve City banks,—is likely;
every effort should be made to
liquidation and with the Fed¬
eral adopting a less aggressive
buying attitude prices have de¬
clined and yields risen, not only
require legislative action.
More¬
over, for the time being at least
the Federal has regained control
invest¬
to
of
i try banks than in the
War Loan with¬
drawals have necessitated bank
on
on
never¬
costly, especially if interest in¬
tificate
47. Time will not permit of a
discussion of these various; plans,
secu-
reasonable expectan-
are
| loans,—probably relatively more
important in the case of coun-
to rise to about .79%-.81%.
to
deposits
f. Some increased demand for
somewhat tighter money
policy and as a result the Cer¬
establish a
whereby the Fed¬
eral Government could do large
amounts of financing through
the Federal Reserve Systems
proposals
of
for 2s of 1952-
to
could, and in
c.
level
2.25% for long term 2V2S.
or
adopt
of
high
continued dependence on
maturities; attempts at trading
the market are likely to prove
on
some
mechanism
all
capital assets and will in¬
crease the difficulty of holding
down the cost of living;; that the
process of further monetizing
the
public; debt through the
banking system should be ended
earnings
regulate
rities
•
be solved
higher
no
b. With
d. And in the case of the Le~
interest rates is bound to have
inflationary'effect
To
c.
supply of money and of lower
a-further
previously
needing
commercial banks.
securties
by the
banking system the supply of
money will continue to increase,
thus tending further to reduce
the interest rate on savings and
investment funds; that the re¬
sultant pressure of an increasing
^
54
controls
credit
can
A
a
incbme from Government
;
the
war-time pattern but it is not
Government securities market.
continues
As
structure
condition in
well
as
the
of
President of
time
withdrawals
under
the Wall Street
Athletic Association, Anthony J.
Shields, of Harris, Upham & Cot,
the
e.
by, cir¬
result of the
a
based
a
wholesale losses,
no
and
Federal is, in my opinion, com¬
mitted to maintaining a
rate
panding credit without disturb¬
ing unduly, the -stability ;of the
debt
As
committed
b. To establish
net
deposit shifts; for this pur¬
I would, by all means, rec¬
ommend Certificates.
fiscal outlook and the program of
debt retirement adopted by the
Treasury the Federal has regained
a
considerable degree of control
over the market.
/
substantial
producing
pose
along orthodox lines.
rates
public
'
debt management
of
level
a
rather
1946
for
sponsorship
/as
of
very
dictated
organized
War Loan
a
nancing of the national debt.
financed out of
savings of the
a
Wall Street organizations has been
of
demonstrate that the problem of
follows:
^ g;; The position of the Federal
is, I think, that as long as the
monetized
upon
league comprised of
representing brokerage
houses, the Exchanges and other
teams
nounced.
y.y.;y4 iyj" .7,
<.
A soft ball
12
d. Securities portfolios should
be adjusted to meet probable
orthodox proposals which have
; been made and, it is, to be
; hoped,
time within which to
a.
ex¬
By Wall Streeters
but
s
;
orthodox
public."
-
aa•.^v
that will make for low cost fi¬
war was
the
and
v.- *
,
program
19.
War
Sofl Ball League Formed
areas and losses
in other areas, may be
expected,
real program which
should allow full time for a consideration of the various less
;
of
reasonable
.
•.
theless?
s
exclusive
more
Some
c.
to reali¬
near
deposits
deposit shifts,
gains in some
cumstances and not necessarily
indicative of the eventual pol-
:
could be applied by the Federal
to cope with a condition of ex¬
taxes
(.
—a
objectives of
plans
alleged
various
a.
management
the contrray, an increase
on
pectancy.
bank-held
icy to be followed, but
summarized
financed through the creation of
commercial bank credit and not
enough, was
;
term
The
orthodox
likely
depos¬
'
orthodox
program for handling the debt,
that have been put forth for man¬
aging the Federal debt may be
cur¬
rency and bank deposits at the
disposal of the public as a re¬
much of the cost of the
;
Plans for Debt Management
16.
in
essential to
an
H
-
•-
over-all loss of
an
Loan is a
budget,—like¬
debt,—seems
barked
r
adopted.
cles is quoted as follows: "The
primary source of the inflation
danger which overhangs the
domestic economy on all fronts
its;
f. Thus, for the time
being at
least, the Treasury has em-
the
to
-Journal of Commerce" Mr. Ec-
sult
.
this inability to peg
"rates and prevent
is
bank-
zation.
s
•(
long term rates from going still
lower that has given rise to
such proposals as that reserve
requirements be increased, that
banks be required to hold a
given percentage of deposits in
short-term Governments, or that
the certificate reserve plan be
known that the Federal Reserve
authorities
It
e.
discount rate.
the
the
the
maturities.
short
balanced
wise considered
'
as,
for instance, the
Treasury's opposition to elimin¬
ation of the Vz % preferential
A
e.
powerless to control longer
stand ready
$ to buy Bills and Certificates to
M replace reserves but in a free
H market it can make no distinc¬
tion between sales to replenish
reserves and sales to buy longer
by official
as
retired
,k*'
b. Except for the loss of War
to be
agement advocated by the more
orthodox.
less
action,
f. On
i
%%
at
and
retired
is
Loan balances there is not
.
debt, thus adopting one of the
basic principles of debt man-
;
% % the Federal is more or
and
vestors
v
Certificate
maintained
esti¬
that, in effect, the Treasury will
have
sold
long term bonds,
2 Vas and 2 Vz s, to non-bank in-
of the taxpayer."
are
-1
It is assumed that most of
be
debt
deposits will be lost to the
banking system.;
to
<— Certificates
and
other short term securities,—so
profits at the ex¬
If the Bill and
d.
the
helddebt,
term rates; it must
that the Treasury is/committed
to
do
contrast
the debt retired will
otherwise would merely
purchased out of newly created
e.
d.
in
January
$7 billion.
mate of
v
the Federal could
hardly allow short term rates to
rise; in his January budget mes¬
sage the President speaking of
the short-term bank-held debt,
had this to say: "Siriqhthey have
been purchased out of newly
created bank funds, continuance
of the present low rates of in¬
terest is
entirely appropriate.
message: "Since they have been
the taxpayer."
.
practical political
a
To
appropriate.
To
do
otherwise would merely increase
bank profits at the
expense of
;
the
5
/1 standpoint
only
were
b. The problem is not to keep
rates from going up but to keep
be retired
President's
may
bank-held
tent
$18 bil-
as
f lion "of the publicly-held debt
i''
•"would be much greater if the
slightly
jj fiscal year as much
'*
"should continue low for a long
lime to come," and at Indiana¬
polis last November he stated
that
■J pand deposits and investments
by $189 billion..
♦
2685
revenues
of
;
2686
THE COMMERCIAL & FINANCIAL CHRONICLE
this situation and to save what it
A Reunited Labor and
(Continued from page 2652)
it may laice years tor us to coax
it back.
»
• '
-
health insurance.
and
ters
make it clear that
housing pro¬
gram, designed to assure the con¬
the American Federation of Labor
struction of 15 million new homes
is strongly opposed to permanent
Government controls over the na¬
in
Now let
me
America
during the next
10
sist any effort to impose Govern¬
years.
In addition, it carries an
amendment, which we sponsored,
balling for .the payment of pre#
vailingjWages on aB ^construction
ment
financed
tional economy.
would
we
war
all
In normal times
uncompromisingly
re¬
price-fixing. But our post¬
is not yet hitting on
the
economy
six.
In
such
an
sudden removal of price ceilings
by loans guaranteed by
Federal Housing Administra-
tion.
emergency,
It is
impossible to over-empha¬
(
#would be the signal for wide¬
size the
spread profiteering and only those
to whom price is no object would
be able to buy what they need.
Every wage earner would suffer
lation to labor.
significance of this legis¬
Just think of it!
Jobs for two million construction
because the purchasing power of
workers—steady jobs at prevail¬
ing union rates of pay—for 10
years. Millions of additional jobs
his dollar<would shrink."J
,
in industries
manufacturing build¬
ing materials and home furnish¬
sibility* of preventing this .catas¬ ings. And an intelligent effort at
trophe from coming to pass. We last to provide good, substantial
of labor, particularly, must mobi¬ homes so badly needed by the
lize public opinion against infla¬ American people.
Every citizen shares ;the respon¬
tion, because the workers
resent
we rep¬
would be the first to suf¬
Yet .the
Bill faces
Wagner-Ellender-Taft
.
hard
fer.
;
House
Therefore, I urge you with all
the emphasis at my command to
write or wire to your Senators to
must not let
fight in the
Representatives. We
this great opportunity
slip.
Let
us
forces
on
reject the crippling House amend¬
ments to the OPA bill.
that the
Demand
OPA be extended as is
for another year--the last year it
will be necessary. See to it that
the
members! of ypur unions do
This is urgent.
likewise.
The
Case
Another critical
Bill
measure now
in
;
America.
This isAtho Case- Bill;
recently adopted by the House of
Representatives. To my mmd, the
Case Bill is one of the most vi-,
of
a
t
/
concentrate
our
this legislation and pre¬
vail upon our Representatives in
Congress to concur in the Senate
Bill. The higher the tide of mail
and
telegrams from you and the
members of your unions, the more
certain it will he that the House
will approve the' .Senate Bill. I
appeal for your
assistance in
bringing about this vital legisla¬
tive
the hands of the Senate contains a
direct threat to the very existence
of a free trade union movement in
achievement.
The
one
long-range housing bill is
of the "must"
measures
draft¬
ed by the American Federation of
Lahpr after y>T Day
as:
pur . legislative program
postwar
reconstruction
part of
for - the
of
our
country.
Our program was so
proposals ever, sound and logical that ^ it later
considered by Congress. It would Was
approved almost in its en¬
revive government by court in¬ tirety by President Truman and
cious
anti-labor
junction and apply the hated doc-'
trine of conspiracy against labor
unions. Despite the fact that ex¬
perience has thoroughly discredit¬
ed* the technique of i compulsory
cooling-off periods
to I prevent
strikes,'■ this bill would impose
them. It also invokes jail penal¬
•
the
establishment
of
vital
gress has seen fit to
of this program.
reject most
can from the
interest
to
the
all
American people, directly affect¬
ing their health, their security and
their general welfare. Yet, after
long delays, Congress is first get¬
ting around to holding hearings on
these
are
no
indications
and
measures
„
that
action, will be taken at
Full
Now obviously, this unsatisfac¬
tory and chaotic legislative situation cannot be permitted to con¬
tinue indefinitely.
Congress can
and must be called to account. But
before considering what steps can
be taken in that direction, I think
the first serious
cials without prescribing any
ishment for employers.
vent
attempt to pre¬
depressions in our
country. We feared that after the
future
those described in
"Southern Democrats
gress between
the press as
and .Reactionary.
That such ; a
legist in; the House of Representa¬
tives—is
beyond question.
But
what is this coalition for and
what is it against?
.
Here is the
answer.
.
The coali¬
tion
is for anything the CIO is
against and it is against anything
thgHlQT
Today
gress
many
will vote
the CIO
members of Con¬
against anything
favors
and
will
vote
to
adopt: legislation that the CIO op¬
poses, regardless of the merits of
the
measures.
That
is
the
tragic
situation
which
organized labor faces as
the result of the division in the
ranks of labor and the unsound
policies which the rebel move¬
ment espouses.
Congress is not in revolt against
President.
It has declared
the
The
reasons
political
are
-
war
not far to seek.
First, the dual movement has been
dominated
by Communists and many of its
policies follow the Communist
Perty line. Secondly, the CIO is
engaging in a direct political war
against many members of Con¬
gress on a purely partisan basis.
that the present Congress is
to
made
Committee
fxatly rejected it and substitued a
milder plan of its own, .designed
prevent
it.
That
which still confronts
is
us.
a
threat
But Con¬
Now
it
must
be
remembered
out serious faults.
It may be rid¬
dled with -much more dangerous
amendments when it comes up on
the floor for
no
a
vote.
Furthermore,
matter what kind of
a
bill the
balked
at
the
the opportunity for a job. After
debate and long delay, a
substitute
bill
measure which is
effective and
so
passed—a
weak, so in¬
was
so
denatured
as
to
Senate adopts, there is always the
threat that some of the obnoxious
be
provisions of the Case Bill
be
Conference
President supported legislation to
raise the standards of unemploy¬
the
ment
restored
when: the
Committees of both
-
may
,Senate
and House try to work out a com¬
promise.
Labor
practically worthless.
Then labor; demanded and the
compensation so that war
workers suddenly thrown out of
jqbs and returning servicemen
largely
of thesame men and
who voted for the: great
women
able to secure the adoption of such
great advances as the Norris-LaGuardia Act, the Wagner Labor
Relations Act and the Social Se¬
Yet today, many of
the Senators and Representatives
who
voted
for ' these
liberal
curity Act.
measures
are
the most bitter ene¬
mies of similar legislative
posals.
pro¬
-
>-r
So that you won't get the im¬ Senate passed a measure estab¬ enemies in Congress. But by pa¬
pression .that everything is going lishing a 65-cent minimum wage tient work and through the exist¬
against labor in Congress, I want but it tacked, on a farm parity- ence of its non-partisan political
to tell you next about the success¬ price amendment which is bo.und
policy, the American Federation
ful progress of our long-range to raise the price of food through¬ of Labor had succeeded in reduc¬
out the land. If the House concurs
housing program. I am happy to
ing them to an ineffectual minor¬
report that the Senate passed our in this rider, the President may be ity. Today, due to the wrecking
bill—the Wagner - Ellender - Taft forced to veto the bill.
policies of the CIO, the enemies
Bill—by the overwhelming vote : Another important; feature; of of labor are in the driver's seat in
of 51 to 20 two weeks ago. This is bur legislative program called for Congress. '
a
The
American
Federation
of
highly important measure. It the broadening and improvement
holds the key to the revival of in of the nation's Social Security and Labor is determined to combat
few months ago
a
the
United
formed the original, nucleus ,of the
CIO. returned to our fold, follow¬
ing the footsteps of the Interna¬
tional
Ladies
Union.
and
a
Garment
They found
warm
an
Workers
open
welcome. The
door
same
treatment
reunited
a
labor
move¬
the
is
ment
motor.
a
While
solution
certain, long-range
the legislative prob¬
to
which
purchasing
and
It will
power.
promote the economic and
social well-being of the entire na¬
Make
tion.
mistake about it—
no
undertaking of Southern
an
lnbor,7by Southern labotf and, for
Southern labor, i,,
7 , 7
We
here, not as invaders
friends
and associates, to offer encourage¬
come
from the North, but as old
ment and support to the aims and
objectives of this Southern Labor
Conference, the greatest gathering
of
trade
union
representatives
assembled below the MasonLine.
You, the delegates
this
conference,
speak
for
eyer
Dixon
to
1,800,000 Southern workers who
already have been organized into
American ' Federation
of Labor
unions.
I predict that before
an¬
other year has passed your organ#?
izing campaign will have added
another million
members to
new
ranks.
our
We
out
start
nucleus.
Our
hold
firm
with
in
initial
strong
a
have
taken
South.
Our
roots
the
unions have fought and
and must be taken.
can
won
the
for
battle
recognition.
Fyom now on, with "careful plan¬
and local unions should work to¬ ning, wiser leadership and con¬
gether with our national organiza¬ tinuous effort, they are bound to
Despite the
tion in perfect teamwork on legis¬ expand and flourish.
lation. We must get quick action progress we have made, there is
from you when we ask you to no gainsaying the fact that the
write to your Congressmen and South still lags behind the rest of
In the first
place, State Federa¬
tions of Labor, city central bodies
Senators in support of or in oppo¬
sition to legislation. After all, no
voice is heeded
members
of
closely by
Congress than the
more
voice of the voters back home in
their
districts.
own
Finally,
the
country in union organiza¬
That is what
mined to change.:
tion.
to co¬
effectively
we are
deter*"
<
-
*
For too many years* the Soutfr
has suffered under the economic
labor
cheap 1 labor.
of
cprse
i.ca)lUponyou
Cheapr
sub-standard labor;
means
unorganized labors Cheap laborlacks consumer purchasing poweri
Cheap labor results in economics
Labor in the application of our
stagnation and industrial paraly¬
nonpartisan political * policy in
sis;
Any country where cheap
the coming primary and election
campaigns. Our legislative com¬ I^bor: exists Is a backward fcoun#*
try.
China, India and Mexico are
mittee in Washington is. now care-,
convincing examples. But where
fully tabulating the record of
labor is well organized and unionr
every member of. Congress.
On
wages "are -paid; you will find a
the basis of this record, the Amer¬
Union wages
ican Federation of Labor will de¬ thriving, country.
create a higher standard of Hyingtermine which members of Con¬
and
higher
purchasing powergress deserve support from labor
Trying to maintain industry and
and
which
ones
should be de¬
agriculture without high" purchasfeated* Let me assure- you- that
ing power is like attempting to
our
endorsements this
operate
closely
and
:
with the American Federation of
year Will
made, as always, on a strictly
nonpartisan basis. We do not give
be
any: blanket endorsement to the
candidates .of
any
particular
party.
Our efforts to elect our
friend?
Operate
automobile without
It just can't be done.
an
gasoline.
Therefore,
we
are
determined
in the South. The
American standard of living must
be the standard for the entire na¬
to raise wages
tion, not for certain favored geo¬
graphical areas.
We don't want
high wages' in. the North 7 and/
tive cooperation.
lower differentials in, the South^
Let us point out that the Amer¬
The American standard of living
ican Federation of Labor, with its
is the only standard of Hying:
seven
million members and ail
which: the American Federation:
their relatives and friends consti¬
of Labor will accept in the South.'
tute
and defeat
enemies
our
be effective with your
only
full and ac¬
can
probably the most powerful
voting group in the nation. If we
stand together on election day, we
cannot be defeated. If we resist
tfcje siren caUs of other ^organiza¬
tions and the professional politi¬
cians who suddenly discover their
friendship for; labor-yfofQctober
Why this sudden change? The apd November^ ;if we march In a
body to the polls determined to
reason is clear and incontestible.
back up the endorsements of the
Despite their good voting records,
American ; Federation
of
Labor
many of these- members of Con¬
gress found themselves opposed in with our votes,-yictory is assured.
/
v
what may.
is being made.
.
rally against this could be tided over the reconver¬
assault
upon
the
fundamental sion period until new employment
freedoms of the nation's workers. Opportunities opened up. The BenOnly by eternal vigilance have we ate passed an unsatisfactory un¬ their political campaigns by the
thus far prevented the "passage employment compensation bill but CIO for .partisan political reasons.
of general labor legislation.
Is It any wonder that legislators
We the House Ways and Means Com¬
need your help to crush this latest' mittee buried the legislation en¬ refuse to go along with an organ¬
assault. Inform your Senators, and tirely.
ization which seeks their political
The third of the "must" .meas¬ death? Is it at all surprising that
Congressmen of your unalterable:
opposition to the Case Bill in any, ures urged by the American Fed¬ a patriotic Congressman or Senaform- That is the most effective eration of Labor called for lifting tor spurns appeals from .an or¬
the minimum wage level of the ganization whose policies he be¬
Way to kill it.
<
'.
■; 7; • 7 ■. ■v J \'i£■'::' V'*,; fv" ■' •/'/
7%;%
nation from the starvation rate of lieves originate in Moscow?
j progress of Housing Program
10 cents an hour to 75 cents. The
Of course* labor always has had
myst
Only
To this end
come
Definite progress
up
bill.. It re¬
much
dedicated,
move#
,
body of enlightened labor and so¬
to *
deal
with
labor ' disputes fused even fo concur in the prin^ cial justice legislation enacted in
through a new mediation agency. ciple that every American able the past 12 years. Before the CIO
Even-the Senate bill, is not with¬ and willing to work is entitled to even came into existence, we were
gress
labor
Republicans" lems confronting: us, there are
coalition- exists—at other and more immediate steps
Education
Labor
we are
"coalition" in Con¬
a
postwar boom had spent itself, a
major depression might ensue un¬
less; steps were taken in advance
and
this is
reunited
a
ment in this country.
without
Against CIO
so; dangerous and so obviously
unconstitutional that the Senate
In fact, this bill is so bad and
achieve
markets
wider
providing
greater
help
is
We hear of
the land of Dixie." This drive will
revive industrial-activity in the
South and benefit the farmers by
X am confident that most qf.our
legislative
troubles
would
be
solved
overnight
if
we
could
v
will
be
accorded
tq
other organizations which left us'
important that we analyze
As : time goes on, they will learn
the reasons for the errors of omisto read the handwriting on the
sion and commission by Congress.
wgll andrealize that without
unity Tahor is like a machine
The Congressional Coalition
it
of its organizations are
Employment Bill Weak
R7
'
Mine Workers of America, which
this session.
unable to hide the fact that many
First, there was the Full Em¬
ployment BilL; This represented
.
Movement
mat¬
are
wreckage,
Calls for Reunited Labor
ofnational
These
legislative > and :■
formally recommended by him to
against the CIO.,
Congress.. Unfortunately,
.Con¬
ties for union members and Offi¬
pun¬
Congress
dustrial activity and prosperity in
America. It provides for a clear
common-sense
Thursday, .May 16, 1946
Address ut Asheville,
N. C.
We
insist that the South must'
not become a
permanently blight-;
condemned forever to'
occupy a back seat in the na¬
tion's economic life.
On the con¬
ed
area,
trary, we regard the South as the
land of opportunity. The war set'
in motion a tremendous industrial
revival in the
South. 7 That trend;
must continue and expand.
No
section of the nation increased;
production more rapidly than
nor contributed more
war
South
the
You showed what you-
to victory.
could ,do then.-
In, a:.
This-is. no time, to
subsequent address at
stop.
Asheville, N. C., before the Amer¬
■;^ j^ivRounl^y-^ihdeed, dhe. en*?
ican Federation of Labor South¬
tire world—is7 istaryed for the
ern Labor
Conference, broadcastproducts of American ^ factories
over : the
NBC
network,
Mr. and farms: : Xt /is: our":3 ob to ,get
,
Green outlined the pian to organ-busy
ize workers in the South in the.
ranks of the A.. F. of L. and at¬
tacked the "Communistic" dual
labor movement as follows:
:
•
**-;
making history here
tonight—carving a new chapter in
Labor
the
is
chronicle
of
American
pro¬
The American Federation
launching a crusade
to organize the unorganized work¬
gress.
of Labor is
ers
of the
South.;
,
and produce what is so
urgently needed. You have what
it: •
takes —-abundant
favorable
resources,
a
climate and manpower
skill and vitality
'accomplish miracles of produc¬
blessed with the
to
tion.
•
Here
'"
>
in
■,
the
South
.
•
stands
a
glorious and imperishable monu¬
ment to the genius of American
labor and
American vision.
I
refer,
of
course/to
the
TVA.
is to raise the Every bit of that giant develop-*
standards of living of the millions ment, which is the world's great¬
wonder - of
technical
and
of Southern workers and create est
Our
a
purpose
new era
of lasting prosperity in.
human
Anffineerins.
was
con*
Volume 163
Number 4490
THE COMMERCIAL
-structed and Is being operated by
members of American Federation
of Labor
unions/^They have made
the TVA wh&t it is—a
efficiency "and good
model
rela-f
labor
fe tions. r
-
-
of
Not a
single : moment's
time in TVA's vital war produclion program was lost due to dis¬
putes between labor and manage¬
ment.
principles of democracy and local
Let
,
give the workers of the
me
South
FINANCIAL CHRONICLE
solemn
this
autonomy, we have allowed and
we are going
to continue to let
Southern workers run their own
when
unions.
eration of Labor, you will be pror
'
r
assurance—
you
organize into unions
affiliated with the American Fed¬
,
In
the American Federation
Labor;
more
even
in
than
of
our
American Government, the prinf
ciple of home rule, or State's
■
moting your own interests and
you will run your own affairs.
Let me give Southern industry
this warning—grow and cooperate
with us or fight for your life
against Communist forces.
-2687
after the last war, we are to
rights if you will, prevails.
The
best conditions, take some time
tendency in our nation to place
o get a broad and well-balanced
Let me give the people of the
ever-Increasing power and au¬
thority in the central government South this pledge—the unions of Output; and 'until this is achieved
for growth and
here will be strong upward pres¬
prosperity through in Washington has not been par? the American Federation of Labor
constructive
labor-management alleled in the House of Labor. are not out to destroy you but to sure upon prices. Another and
cooperation. As our organization We don't operate that way.
We bring better and more prosperous related factor is the tendency
campaign progresses, our unions think over-centralization is dan¬ times to the South.
They seek toward a continuing decline of in¬
will seek to bargain
collectively gerous and may lead to dictator¬ your help and friendship.
terest rates.
The combination of
^for workers who were never or- ship.
When this conference adjourns, low and declining interest rates,,
ganized before, with employers
The
American
Federation
of the organizers of our Southern redundant money supply, and fav¬
who have
stubbornly refused to Labor rejects
dictatorship in any unions; augmented by a large orable business expectations has
deal with unions in the past*'
form.
We have complete faith in corps of assistants, will set out on often in the past been a highly ex¬
;
I say to those employers here democracy and in democratic their mission as
good-will amr plosive inflationary force, push-,
and now that the time has come
Our Cons t it u t i o n bassadbrs of our great organized ing up prices in all markets, fori
for them, to; be realistic and show processes.
lodges
supreme
power
in our labor movement. Their task will Doth securities and commodities."
good business sense.
They can no
riiembership. Neither the Amer¬ be difficult, but they will never To these forces are added; in the
longer stem the fide of upion orican Federation of Labor nor its rest until; all the workers of the present case, the large, and ! still
ganization.
Whether they like it
national officers can exercise any South are able to clasp hands in untapped wartime savings and the
j v or not, the workers of the South power or compulsion. Our poli¬ the
huge backlog of deferred de¬
stirring symbol of unity and
[ are going to organize.. Employer cies are adopted;; and enforced
mands. Of special importance in
.] resistance will only redouble our solely through the consent of the fraternity which is the proud em¬ such circumstances is the relation
'efforts.
Nothing" can stop us,
governed.
This is the American blem of the American Federation between wages and prices. As al¬
J.; neither the opposition of reaction? way. f
of Labor.
ready stated, the inflationary out¬
ary management, nor the rivalry
burst after the last war followed
•
The
•'
Labor
-
American
Federation
of
which may achieve a more stable
have
relation,
sharp inflationary outburst fol¬
lowed by depression. Undoubted¬
ly, there are strong inflationary
pressures.
The money supply has
trebled since 1939, and business
and
the
consuming public are
more liquid than at any previous
ime in our history. Though pro¬
duction is rising, it will, under the
a
it is
progress
the
results
There
ties
view of the
have
and
too early to
of
the
also
much
been
assess
policy.
new
<
uncertain¬
division
of
opin-<
ion with regard to the operation of
price controls. Extension of the
Price Control Act
pensable
offers private' industry
now
in
though
fact that major strikes are still in
seems
condition
of
an
a
indis-
■%'
success?
ful
anti-inflationary policy in this
postwar period, when
potential demand is so far in ex¬
immediate
•
,
of available supply. But there !
been a
growing awareness
cess
has
that the control
and be based
fact that
r
when
to
the
Communistic
dual
move-
The Dual Movement
'
1
Let
few words now
j' about this dual movement; With
me
say
a
N.Y. Federal Reserve Sees Post¬
'
Its usual flair for sensationalism*
it anriounced recently; that it .in-
['<" tended to make the South
year. That
approach, however, didn't go over,
j * It aroused
L* support.
Adjustments Unbalanced
a do-
| litical battleground this
'
war
more resentment than
(Continued from page 2645)
billion dollars, has been rapidly
moving toward
balance.
even
It is clear that there
So how the ddai move-
| • ment has changed i ts tune^, Now
an
was a
gen¬
eral underestimation of the force
of the expansionary factors which
proclaims
its
intention
of
starting a rival organizing cam¬ the close of the war Would let
loose on the economy; The out¬
paign in the South.
\
The workers of the South will standing feature has been the con¬
|, it
■
•
tinuous rise of
consumption from
this sudden and
month to month since the war
transparent reversal of policy any
ended. This is all the more re¬
more than the American people
were.fooled by the abrupt changes markable in view of the fact that
in the Communist party line d ur- during the war; consumption had
not be misled by
."
;
'
?
ing
the
munists
war.
The
condemned
CIO Com¬
America for
'
•
::
1
-
1
•
4
imperialism
arid
picketed
the
White House during the Stalin*
Hitler
pact end
then
became
super-patriots after Hitler invaded
Russia:
Now they have swung
back again to the old charges of
American
imperialism
because
_
•
our
•
•
country has' had the courage
to oppose Soviet Russia's aggressive foreign policy,
' < ' <
•
The weather vane
of the dual
movement swings to the right or
to the left, whichever way the
-
5
•
'
;
-
•
wind
from
Moscow
blows.
As
South
are
concerned,
I
predict that
though they may invade you today, they will be gone with the
far as
their efforts in
the
wind tomorrow!
For the workers of
•
South
the
are patriotic Americans.
They do
i not relish the idea of outsiders
:
erful.
There
Fundamentally,
ed.
"
y
•
,
| port the friends of labor in public inflationary forces.
pendence of our members and
never will.
;
'
1
r
-
.
•
•
we
confidence of the workers and the
public authorities.
We
S..V
have not sent and
■
we
*
'.
will
not send outsiders into the South
'
to
•
tell
fairs.
you
In
how to run your afaccordance with
our
In the spring
of
1920, the boom collapsed, prices
and
unemployment rose to over 5 mil¬
dropped 40% by July 1921,
lion.
The
American
economy
is
much
In the past decade, the Amer¬
ican
Federation;- of; Labor
has
made great forward strides in qrganizing Southern workers." Our
local unions, our State Federations
of Labor
and
our .' city
central
bodies are firmly established in
every
industrial community and
have earned the respect and the
is
evidence
that
output is
:
expanding, but it takes time, un-.
der the best of conditions, after a *
great
of
war to fill up the channels: &
trade with civilian goods and
achieve
;
-
wage rates to sustain the wartime
level
of
take-home
pay, and it
part after the last war for the
soon became
apparent that some
present huge accumulation of de¬
offsetting price increases would be'
ferred demands.
Comparatively,
unavoidable.
we
took that war in our stride,
In assessing our present situa¬
with
relatively little
restraint
upon the civilian economy.
We tion, it may be helpful to list
some of the main features of past
produced, for example, a million
inflationary periods. Historically,
passenger automobiles in-1918/
drastic inflation has usually beep
Undoubtedly, there are very
associated with budgetary deficits
strong
expansionary
forces
at
and with deficits in a country's
work- today.
One of the most
sure
ment has
and no anxiety
an important ele¬
been the general sense
of release from
sultant
larger today than it was in
1919, and swings of the same rela¬
tive
magnitude in employment
would
to
run
considerably larger
figures. We have, moreover, come
through a much bigger war, par¬
ticularly as regards the American
effort, and the forces generated
by it which can affect the post¬
war
period are much more pow-
and the
war
Willingness to spend
re¬
more
freely.
Some
of
v
these
k
'
there
The
doubtedly, rilso,
using * them as; political pawns.
These
unexpectedly favorable
:
They cannot feel at .home in ah developments in the initial phase
\ organization i which
seems. incap¬ of transition from war to
peace
able of cooperating with industry have
sharpened fears that; we may
and spends most of its time
iji repeat the experience after the
trying to destroy private indus- last war. After a brief period
of
j try,, They have nothing in com- hesitation, a buyirig boom got un¬
; mori
with the foreign philoso- der * way in the
spring : of 1919.
phies of the CIO,
Wages and prices rose in a spiraj.
i : We in the American Federation There was
feverish inventory ac¬
of
Labor
do
not
propose
to cumulation and forward
buying,
achieve our objectives by political and
export trade expansion, to
! purges. We follow a atrict.lv non- meet the needs of a
war-torn
partisan political policy. We sup- world,
intensified
the
internal
office and we oppose labor's enemies.
We have never bartered
or surrendered the political inde-
counter¬
in a situation
present, the antidote to' /
inflation is a large and balanced >
output with rising productivity "!
per worker.
Viewed as a whole, ^
the
derly prosperity or have an infla?"
tionary outburst terminating in
depression. Perhaps equally im?<,
portant, especially for the longer;
run, is the emphasis on increasing >
productivity per worker. During;
the
we achieved an enor¬
expansion of output, and by; "
more
than any other
managed to ward off the danger :
war,
mous
this
of
means
inflation.
But
did
we
it more?
through concentration of the
war
striking facts is that the growth international balance, leading to, effort in the mass production in-.t?
been already at the highest level of consumption has been mainly currency depreciation. With these, dustries than through any over-all
arid largely; as a
in our history. Perhaps ah even in ■ nondurable
goods. ^ Expendi¬
consequence of increase, m productivity. Indeed^!
tures for such goods have been them, has gone a distrust of the there is considerable opiniou that
more remarkable fact is that, so
resulting
in
capital there was an actual loss in effi¬
far as the data yet indicate,* the far higher in relation to disposable currency
rise of consumption, in the aggre¬ income than could have been ex¬ flight and a panicky desire to run ciency, and this is not surprising?
in yiew of the fact that war com^ i
gate, has not been financed to any pected on the basis of the rela¬ aw^y from money intq commodi¬
extent out of wartime savings but tionships in the period 1929-40. ties, real estate; and equity se¬ pels a country to get the largesfei
curities. These conditions are to¬ output in the shortest time
of
the
re-?:
explanation
un¬
mostly out of current income. Ap¬ Part
parently what is happening is that doubtedly is that consumption had. day fortunately absent in this gardless of cost. But if history is
deficit is apy guide,: the war should be fol? :
the public, while still retaining its been at low levels during the de¬ country. The Federal
huge backlog of savings, is spend¬ pression years and supplies of rapidly diminishing, and there is a lowed by a resumption, and even
ing much more freely out of newly many. goods of this character, as highly favorable prospect of a bal¬ an acceleration, of the sharp ad-;
anced budget; for the fiscal year vance of
productivity per: worker
received income than almost any? well as of the durable goods, were
1947. In the last bond drive, the which characterized the interwar
one anticipated, and in the process limited during the war.
The re¬
overborrowed
its re¬ period.;; Such an advance would,.
is generating new forces of expan¬ turn of large numbers of service¬ Treasury
sion wpich are proving sufficient men to civilian life has also in¬ quirements and wiJh its present prpvfde the basis riot only for
re?
to offset' very: largely the great volved much special outlay, and large balances is effecting some ducing inflationary pressures
reduction of the debt. We should through the rise of
output, but
depline in ■? military expenditures. With this has been coupled the
do everything possible to maintairi also" for
establishing the relation v
Meanwhile, the replacement of sharp increase in Government
revenue at its present high level
of high incomes and low prices
persons
temporarily
employed transfer payments reflecting in¬
and to reduce or postpone expen¬ wfeich is essential for
during the war by returning vet¬ creased mustering-Qut pay to dis¬
continuing ?
ditures.
erans is
prosperity in the longer; run.
proceeding more rapidly charged servicemen and unem¬
Pp
and smoothly than was
Internationally, there is no pres¬
anticipat¬ ployment compensa tip n. Un¬
:
■
little
was
an
a well-balanced output. To>
dropping of wage this,
objective. Governmentaland
controls after V-J Day and the
business policies must fee mainly;;
early sanction given to wage, in¬
directed, and upon our success in
creases which would not require
achieving it will largely depend I
price increases developed quickly whether we shall
lay the founda-\ h
into a general demand for higher
tions in 1946 for a period of or¬
higher.
'
condition
a
like
the familiar wage-price spiral, in¬
creases in each pushing the other
s
price changes, in a period
are trying to work back
mand.
'
of
flexible
we
have
•
ment.
be
must
recognition of the
of free markets,
indispensable role to play
in bringing out a balanced output -'
and directing and controlling de?,
"
•
on
influences
are
temporary and inay already have
reached or passed their peak. But
against any leyelxng-off in this
type of demand is to, be put the
fact that the expansion of durable
goods, both consumers1' rind pro¬
ducers', has scarcely begun. It
seems reasonably certain that the
deferred demands for automobiles,
housing, and other consumer dur¬
able goods, combined with re¬
plenishment of producers' inven¬
tories and demand for fixed capi¬
tal goods, Will carry ciyiliart pro¬
duction, already at a new peacetime high, to substantially higher
levels, To home demands Will un¬
doubtedly be added a substantial
export demand, for the financing
of which, in addition to Govern¬
mental aid arid such private lend?
ing as may develop, there has
been bujlt
up during the war a
large volume of foreign gold and
dollar balances.
*It
•
be
must
figures
of
remembered
savings
are
that
available
met
figures," and it
is possible that there Jias been substantial
use
of ; wartime savings
by some people
while
others
amounts,'
-
have
continued
;■
to
save
large
ip
'All
these
factors
on our
lend
we
force
are
to
now
■
-m
:
.
Funds Available for Pay't
On Panama Bonds ;
•
r
.
no
fundamental
/
distrust
of
our
such as characterized
the great European inflations after
currency,
the last
war.
redundant
.
But
we
do have
a
supply and a
tendency toward continuing de¬
cline of interest rates, and these,
money
5%
external
secured,1'
sinking fund gold bonds, series A,'
May 15, 1963, that funds have
35-year
due
been
received
the
under
Fiscal;
Agency Contract of June 22, 1928,
under
which
bonds
the
above-entitled.
issued
when combined with other infla¬
and are now?
available for distribution (a) as a
tionary pressures, canhave effects
final
which, though much milder, are
not dissimilar in character to dis¬
interest
were
payment
on account of the
represented by the Nov,
15, 1941, coupon pertaining to the
said bonds in the amount of $3.62,
Probably the two most funda¬ for each $25 coupon and $1.81 for;
mental aspects of our situation each $12.50 coupon and (b) as a
today are the danger of a wage? partial payment on account of
price spiral, such as we had after the interest represented by.'the
trust of the currency.
the last war,
tions
of
output.
the
As
and the related"
volume
has
been
and
ques¬
stated,
May 15, 1942,
to
the
of
$17.70 for each $25
drive for higher wage rates soon
forced
to
to
be
accompanying
prices. The problem is how
stabilize
nounced
ruary
some
this
relation.
The
wage-price policy an¬
by the President on Feb¬
14th
recognized
the
need
said
$8.85 for each $12.50
recognition that there would
have
rise of
coupons pertaining
bonds in the amount
of
the
cost
laying the groundwork for a fair- for reimposition of wage-rate
ly extended period of high output. control and established a proceand employment or
whether, as dure for wage-price adjustments
,
§
■
stability of the dollar. There is,
however, a danger of excessive ; The National City Bank of New Iexports at a time when supplies York, as fiscal
agent, is notifying
at home are still scarce, There is
aolders of Republic of Panama'
modified
the question whether
balance of payments
about the external
The
at
the
The
distribution
office
of
will
the
and
be
fiscal
made
agent,
National
York,
22
surrender
City Bank of New
William Street, upon
of
the
Nov.
coupons and upon
the
coupon
coupon.
May 15, 1942,
15,
1941,'
presentation of
coupons, accom¬
panied by properly executed let*
ters of transmittal,
j?;,/
V
LJ
;•
2CS8
V
THE
COMMERCIAL; & FINANCIAL" CHRONICLE
1
■
.
|
1
i
.
be
Taxing For Better Living
(Continued from
taxes shall
must decide
we
2641)
page
appoint to do the
we
desires
we*
The answers we make to essential, and what combination of
these questions will enormously taxes will carry us nearest to our
influence the amount of purchas¬ goals.
job?
ing
v
'
;
available to
power
goods
the Incidence of
buy
nation can produce.
our
reduction of the debt has a
■
healthy
'
'■
;;
>
-
Corporation Tax
'&.?
In choosing between taxes which
employdiscourage consumption and taxes
merit are high, we may be able
which deter investment- the cor¬
to. fraise
the entire $25 billion
poration tax presents a special
through taxes, and even reduce
problem. We do not know where
If national income and
the debt.- -In these circumstances
;
the
shall
If—I
influence.
not
say
"when"—na.ional income and em¬
ployment are low, we shall hardly
be able to raise all of the $25
trillion through taxes without fur¬
ther 'aggravating a deflationary
circumstances
In these
situation.
the burden of this tax ultimately
falls.
Some people contend that
the tax is
shifted, that although it
paid by the corporation, all, or
some
of it, is passed on to con¬
is
and wage-earners.
sumers
that it
extent
in
sumers
is
the
shifted
form
To the
to
of
prices, it becomes, in fact,
con¬
higher
a con¬
budget deficit would almost cealed sales tax and
cuts capacity
certainly be needed to put idle and
incentive to spend. To the
men and money to work.
a
In
we
choosing
taxes
cut
more
•
sources
of revenue
must bear in mind that some
than
down
private spending
That is why
others.
structure and the size
our revenue
of the
I
budget deficit or surplus
are so closely related.
If we selec; taxes which depress private
expenditures
least, any deficit
needed
to
sustain
adequate
level of total demand for goods
in- general will be
relatively less.
But when revenue requirements
are high, the matter of selecting
the least deflationary taxes is not
as simple as it seems.
'
'
•
an
Choice of Taxes
If
realize
to
are
we
im-
the
■
measurable
extent that it is shifted to wageearners
in
the
form
of lower
it also has
wages,
reduce
tendency to
expenditures.
a
consumer
These
two
hand.
To the extent that the cor¬
effects work hand
in
ternative is
individual
the corporate level.
a tax at
In the end his
will depend
answer
specific
the
upon
;
'
"Double Taxation"
possibilities
bf
the
the
of taxes without avoidable harm-J
<prospective
offset, the
principal invested
sufficient
of
and to indicate
to
ful
business
as
level, and again at
individual
the
level;
profits
corporate
In
are
be
inclined to go in.o peril¬
if they could keep
more
ventures
ous
when they
more
But
won.
The extent to which "dou¬
ble taxation" is real, rather than*
ephemeral, largely depends upon
icism is directed to the
whether the tax is shifted to
the tax
losses,
ness
shares
both
in
is
tax falls on wageand consumers, there is no
"double taxation" because one of
If
they
ers,
it would be exonerated from the
investor to take
and full employment depend
charges of inequity and discrimi¬
high consumption; and any nation
tax which hears undidy upon cbri- ents.
sumption places prosperity far¬
upon
-
ther from
reach. What is
our
dividend
against
recipi¬
."Double taxation" Is
elusive
an
more
market.
If
businessmen
cannot
sell, they will not need the en¬
erally speaking, the people in the
lower income brackets have a high larged plant and additional equip¬
■
-
willingness
to
in
ures^-the
risk
come
ven
groups
invest—-especially
higher in¬
provide funds for the
expansion of the economy. To the
that these taxes are not
extent
shifted
to
bracket
taxes,
those
income
they
who
taxes
do
not
pay
and
lowexcise
rignifican ly
den
investment funds the
under
rates
the
com¬
personal
ever,
cause
and corporation income taxes are
affect consumption. This is to the
But
middle and high-
vestment?
bracket income taxes arid corpo¬
ration taxes may, under some cir¬
made
is to the bad.
So
we
are
<
faced wi h
of objectives.
conflict
a
Taxes cannot read¬
ily be designed to encourage both
consumption and investment; The
rub, of course, is that we need
revenue and that we must obtain
it from either the
spending or the
saving
class.
But when we tax
people who spend, we reduce pur¬
chasing
power.
people
who
both
and
the
And when
we
tax
save,
we
diminish
available investment funds
the
one
incentive
case
in the other
we
we
to
invest.
curtail
deter
In
markets;
expansion.
Somehow, in this area of conflict¬
ing pressures we must make a
choice which will favor
other
of
our
one or
objectives.
the
That
choice will call for the most deb¬
ate judgment. It will
mean
'
*
are
,
losses
by corporation executives,
guided, perhaps subconsciously, by
Iheir interest in corporate profi.s
and without full regard for the
woes
of their stockholders,
the
corporation tax will undoubtedly
investment
more
personal income lax.
>
than
the
Where; de¬
cisions
are made by the individual
investor, theoretically it may make
no
difference whether the corpo¬
ration
dends
vestor
in
pays
are
bears
before
tax
distributed,
pays
either
the
the
case
available
tax
divi¬
or
the in¬
later
on, if
income
dividend
the game total tax burden.
involved.
The
other
of enterprise. Its structure
forms
ment.
■
holders
control
Finally, individual stock¬
may have little practical
either
over
the
aay-to-
day operations or the major poli¬
cies, including the dividend poli¬
cies, of- many corporations. They
inchoate
have
ownership
of
the
corporate assets and earnings, but
that
is
quite
direct type of
different from the
ownership enjoyed
by partners. These special char¬
acteristics of corporations are in¬
tegral parts of modern big busi¬
ness operation, - /
-.
•
stockholders
while
L°ss Offset
'The
cliche
argument
that
the
corporation tax* "destroys
incen¬
tive" and "kills the desire
t(5 t?ke
the
risks"
conception of
incidence
of
the
corporation
tax, by the extent of taxation of
that undistributed profits, and. by the
also
stands
in
need
the
paidj
evaluating the 1
subject to
the]
small
:
pro-*
this
tax by personalFrom this viewpoint
stockholder
the greater
ration
are
who
income
tax
pays
bears;
burden of the corpo-^
tax, since the "deduction" ;
of the
corporation tax saves none
of his taxes.
On the other hand,
the
high-bracket stockholder suf-; <
reduction in net
fers very little
take
event
into
account
fact
the
dividend
than
by applying them
in
any !
the
But
is
issue
not
clear-*
as
cut as this analysis makes it ap-*:
The wide distribution of
stockholdings does not prove that;
pear.
their
absorb
to
because
personal
distribution.
greater
position
income
his
taxes would ■
have taken most of his dividend>
that
11
s m a
the
against
tax
unfair
is
to
"
low-income
a
groups.
There is
ence between
the
the income of other years.
vast differ-:
distribution of;
generous allowance for the
offset of losses reduces this dis¬
stockholdings and the importance;
of dividends in relation to total:
crimination
Income in different income rilass-i
A
between
large
and
es;4 Dividendsconstitute
sttiall corporations.
The questioh
then 1$; What kind of loss offsets
are
beneficial
most
the
to
the income of the two years pre¬
ceding the year in which the loss
occurs, help to keep dying firms
alive and give' a greater certainty
of loss offset to old corporations
with past net income than to new
corporations with no past net in¬
come.
Inequities Of this type in¬
economic concentration and
crease
tend to lower the volume of
investment.
If
want
we
the volume of
crease
new
new
to
in¬
invest¬
ment, we must give every possible
impetus to new firms. A large
part of the answer to the problem
increased
of
therefore,
risk-taking - may,
in an improved
method
be
of loss
offset.
Here
im¬
a
much;
larger propordon of high incomes
In 1942, for example,
dividends amounted to less than!
than of low.
econ¬
omy?
The carry-backs, which
permit losses to be applied agains.
>
Vk%:. of i income of individuals
with incomes of $4,000 or less, and
nearly 154 %
of income
viduals with
indi-
incomes of
of
$200,000
While the corporation1
and over.
ta^' takeri by itself,; tends to1 be
regressive because its burden is
lower per dollar of dividend in*
come,
the higher the dividend
recipient's income bracket, this;
regressive tendency is offset be¬
the percent of income upopi
cause
which
the
creases as
which
imposed
is
tax
in¬
income increases. A tax
which:
reduces;; dividends
represent such a large percent of
income of high-bracket taxpayers
cannot be said
to have a
wholly
regressive effect.
;
provement lies in eliminating the
carry-backs
and
substituting |a
longer carry-forward.
An
improved
offset
of
method
alone
cannot
solve
loss
the
problem of diminished incentive.
Even
an
provision
unlimited
would
carry-over
•
insure
not
full
loss offsets for corporations which
never
realized income equal to
unsuccessful
their
investments.
Moreover,;1 there should be re¬
straints upon the encouragement
given by tax law to concerns
which have proved by extended
experience that they cannot oper¬
ate successfully.
in
any
event,
we need not
rush desperately to
the
tion
ihat
conclusion
tax
cause
should
be
the
corpora¬
abolished be¬
it limits investment to
some
We do not
solely because they
taxes
impose the measure of regulation
and
economic
volved
in
all
impediment
taxes.
a'tenant
of
fects and reduce
ics
iments
that new investment
in plant and equipment will not
from
individual
no
risks.
more
may
candid reexamination. Certain crit¬
cnarge
In
are
preceding or succeeding the loss,
In appraising loss offsets we must
iooiish
between corporate
and personal taxes
may very well
be governed by his
corporation
stockholders
some
tected
Howr
unascertainable degree.
individual in¬
vestors' choice
permits
intercorporate affiliation with or
without' Integra' ion of manage¬
But, practically, Other motivations
are
to
tax base.
come
be offset only
against income of the two years
#
Where investment decisions are
deter
not
the
computing their individual :,
final effect of the corporation tax '
we
must remember that many;,
bill,
,
good.
cumstances, deter investment. This
limited life span
But in effect stock-.'
"deduct"
not included in the individual in¬
the reduction in income be¬
of the tax might induce the
losses
It has
on1
multi-1
as on
exemptions.
Corporation and stockholder are
one when separateness hurts; they
are two when separateness pays.:
continuity
heavily
as
orphans
not become less attractive,
better
perpetual life and operative
as compared with the
of an individual
an
important consideration.
But or a partnership.
Its entity per¬
regardless of the rates there re¬ mits: easy transfer of ownership
mains he question: What combi¬ and" management.
It has access
nation of the two tax pressures to nation-wide, sometimes world¬
will be least detrimental to in¬ wide, sources of financing which
on
bined
falls
progressive individual income tax,,
is otherwise advantageous to them.
ment into which it is hoped cor¬
propensity to consume. If we de¬
porations and investors will pour
liberately : set out to encourage
From the legal and constitu¬
heir surplus funds.
consumption, we find that Certain
tional angle, the taxation of cor¬
taxes, such as payroll, excise,; and
Deterrents to Investment
porations as separate entities is
low-bracket income .axes are inr
II we set out to minimize tax completely justified. As a matter
imical
to
our
objective.
These
deterrents to investment we are of legal history, "double taxation"
taxes are soon reflected in smaller
confronted with another difficult is no novelty in the United States,
expenditures for consumption.. The
and "double taxation," if it hi.s
problem.
Obviously nothing is
obvious
way
to stimulate con-*
all alike, can be perfectly equita¬
gained in terms of total demand
sumption is to reduce this tax
for the ' products * of "industryif ble; It is not a crime per se. As
pressure..* ;
:. ;>>
.V-'V*
Mr. Justice Holmes has said; "The,
tax' pressures on consumption
are|
But .if we have a fixed revenue
lifted by, perhaps, $500,;'while in-f Constitution no more forbids dop*
goal, we are driven over to mid¬ vestment expenditures are cut ble taxation than it does doubling
dle
and
high-bracket
income down by the same amount. There .he amount of tax."
taxes, es .ate and gift taxes, and are two facets to This
A corporation has many char¬
problem.
corporation taxes to make up the Taxation
r e du c e
may
profits acteristics that distinguish it from
difference. These taxes fall prin¬
available for investment and the individuals for whom it is
cipally on the people in the higher
thereby deter investors from pur¬ supposed to act.
It gives limited
brackets, who have a strong ten¬ chasing
stocks, or it may reduce liability to stockholders; they are
dency to ; save.
By their saving, the savings available for invest¬ not responsible .for its debts as
if it is npt
excessive, plus their ment. In terms of total tax bur¬ are the partners of a partnership.
dif^;
the
by the corporation reduces profits?
available for distribution arid is
corporations experience
fluctuations in
income
large corporations.
Large
corporations are more certain to
.axes which reduce consump¬
dilemma.
Our national income is
ration and stockholder when that have a steady flow of income over
tion are bound to contract that
doctrine permits tax avoidance, or the years, and are therefore in a
largely concentrated in the lower
and middle income brackets. Gen¬
of
the investor's
risk
would
be
commensurately
reduced and risk-taking
would
that
-
in
corporation
income taxes, since the tax
The principal
present limitation
on loss offset lies in the provision
come
difficult.
the
in
it
holders
tax in
com¬
accomplished. A high national in¬
re-r
shifted,:
income of stockhold¬
In the sense of its original *
impact
plete, and part of the investor's
loss were always absorbed in a
tax
If the]
not
account
no
of
con-'
clearly
is
that
and
were
is
more
true
widows and
corporate
regardless
it
it
millionaires.
poration tax is paid by the own¬ the two taxes
imposed upon divi¬
ers
of capital, it represents an
dend income—the tax supposed to
additional personal income tax.
be
paid by the corporation—is
It is reasonably certain that shift¬
actually passed on to others.
In
ing the corporation tax to consum¬ .his situation the corporation tax
ers and wage-earners would have
might be guilty on a charge* of
extremely unfortunate economic reducing consumption by raising
effects, if complete shifting were prices and depressing wages, but
reduced
is
takes
tax
There would be dis¬
crimination against risky invest¬
ments, if we had no provisions for
limited.
If
analysis is
individual.
are
shifted,
gressive.
since the provisions for loss offset
tax
the
Is
It
impact ofs
stockhold-*
and wage-earners.
sumers
tax
common
made
busi¬
corporation
which
to
If the final burden of the
is
ferences
Government
the
upon
and
ers
'
-
earners
extent
•
businessmen might reduce their
risk-taking if they could make a
satisfactory profit without risk.
others.
I
;
regressive and violates the prin-'
ciple of ability to pay.: This crit-1
some
offsetting losses. While the Treas¬
ury always shares in gains, it does
not
share completely in
losses,
the
shifted.
Tax
The corporation tax is also crit¬
icized on the ground that it is
so
far
to this
distrib¬ story—the fact that through taxes
"double taxation"
element of
exists.
Corporation
Regressive^
There is another chapter
uted to stockholders it is true that
an
the
Is
minimum return
a
the principal.
It seems almost
axiomatic that businessmen would
on
No one will gainsay that our any particular amount of profit
and would go on being venture¬
present tax system is far from
some,
The temperament of each
perfect. One of the loudest com¬
businessman would determine his
plaints is lodged against so-called
reaction.
Higher rates of profit
"double taxation," whereby cor¬
would embolden some, but not
porate income is taxed once at
the
effects.;^v,^f'.X;,,,
Others would not be satisfied with
proposals
tax
which he compares.'
concept which calls for careful
easily forgotten is that reduced
terms of employment
scrutiny. The premise of the crit¬
and national income, it is essential consumption, as well as the cor¬ icism implied in the term is that
that we maintain a high level of poration tax, will ultimately im¬ corporation and stockholder are
pair the desire to invest.
For in one economic
V consumption and investment. But
entity. But taxpay¬
the long run investment depends
from the
tax
ers
are
quick enough to insist
standpoint that
upen a market for goods produced,
} requisite
presents an awkward
upon the separateness of corpo¬
and
future
unless
is
fear of loss
a highly progressive
income
lax,
he may
prefer
made
return
what part of our alternative necessary to replace a
discard as least lower corporation tax. If that al¬
can
^Thursday, May 16, 1945
....
to
a
to
We
.in¬
should
eliminate
de¬
Looked
By mis
approach we may gain the benefit
the
corporation tax
profits distributed as dividends
in
individual income tax.
It
could be replaced by increases
the
could ? be
sense
upon
not.
replaced
in
the
that the increases would fall
exactly the
individuals,
same
but rather < in1 the sense that the.
same
net
be levied
come
of
amount
upon
class.
taxes
could j
each taxable in-;
With
a
set
of
indi-j
vidua! rates somewhat lower than'
present rates ; and roughly the I
present dividend distribution by, j
income classes,
the replacement:
would require additional surtaxes
,
ranging from about 2% on incomes
of less than.$2,000 to about
7%;
on
incomes
over
dicates that even
$8,000.
This in¬
though the cor-;
poration tax takes more per dollar
of
dividend
income
in
income brackets than in
the slight
as
the
low-
the high,'
importance of dividend:
income to low-income
economic imped¬
minimum.
at in another way,
net burden of the
on
individuals
compared with its major
portance to
im-j
high-income individ-r
[Volume 163
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4490
*
268#
"
•
•
-■
If
.
foals is. a factor that makes for a
broadly
istrative
in
involved
difficulties
applying this method to large cor¬
M
porations with many stockhold¬
I Should the Corporation Tax. Be
ers.
The plan would work best
i
Repealed?
: '?
f with f closely-held
corporations
'L
Almost everyone agrees that the with simple capital structures. To
progressive tax.;
\\
separate economic entities
to
■
a
reasonable
fer.
It is
may hones Jy dif¬
question which cannot
men
a
.
present tax treatment of corporate
income is unsatisfactory. Theo¬
,
retically, there is no good reason
;for taxing income at the business
ievel, if it may be taxed as equit¬
ably after it is received by the
individual owners of the business.
of
its
practicability,
partnership treatment could be
made either optional or manda¬
the
extent
tory;
:.'££
The essence of the second meth¬
individual-and
corporation taxes is to impose an
But there: are two pra ctical rea¬ income tax upon the corporation,
sons why
outright repeal of the but to grant a full or partial de¬
corporation tax in favor of in¬ duction to?£ the£corpordite^
creased reliance upon the indi¬ dividends paid out.
In net effect,
vidual income tax is not feasible, this plan would impose a corpo¬
first, all corporation profits can¬ ration tax only upon undistributed
not be taxed when received
as
profits. One flaw in the method
personal income by the
share¬ issues from the fact that many
holder, since a substantial * part small and medium-sized corpora¬
jof corporation income remains, at tions, without ready access to cap¬
,least temporarily, with the cor- ital markets, must retain earnings
Iporation and is not paid out in in qrder to expand.A corporation
dividends.
If
abolished
we
the
od of coordinating
tax -which offered an inducement
:Corporation tax and made no pro- to distribute earnings might play
•vision for, taxing undistributed into the hands of large, developed
iCorporate profits, corporations corporations in a position to dis¬
!Would: be able to accumulate tax- tribute all or most of their profits
fr£e profits indefinitely.
Stock¬ to shareholders. Some modifica¬
holders could realize cash by occa¬
sional sales of stock, and gains on
these sales would be given prefer¬
tion which
recognized the prob¬
small and me¬
lems of financing
dium-sized
would
business
cer¬
ential
capital gains treatment. The tainly be necessary.
stock not sold during life could
The third method of coordinat¬
he passed on to heirs without the
I payment of any income tax.
The
: estate : tax would eventually re¬
duce the amount of untaxed
its, but there would be left
stantial
|Wealth
amount
corporation
adjustment
corporation tax on dis¬
tributed profits at the individual
rather than the corporate level.
ing
the
face
in favor of
a
dends
incorporated business.
Stockholders
as
were
Under
individuals would
the
withholding
plan
taxes paid by corporations could
in¬ be deducted
by dividend recipi¬
dividuals who owned no stock.
ents in computing their income
Persons owning stock at the time
tax. The theory is that the cor¬
the tax was repealed would have
poration tax is .a withholding tax
enormous windfall gains.
on
behalf of stockholders, and
The second reason for retaining must
be
credited
against the
thef corporation tax in some form stockholders' dividend income to
in our revenue system is that it avoid
"double taxation.-'. This is
would hardly be politically expe¬ the
approach taken by British
dient to meet: practically all of law*' This
method; the partnership
our
revenue1 requirements
from
method, and the dividend credit
the individual income tax. From at
the corporate level would give
the standpoint of our economic the
greatest relief to taxpayers in
goals of high employment and the lowest brackets.
All
three
high national income,. a corpo¬ would encourage individuals > to
ration tax. is distinctly preferable invest in
stocks,; .since they might
to increased reliance upon excise
expect,.a larger > return on, their
taxes.
The tax escaped byr cor¬ investment after taxes.
porations on their savings would
be
completely
favored
over
„
heavily
-more
a
large
would fall
burden
the
of
share
doubt,
without
■where;
on
consumption.
and Corporation Tax
How
to
diminish
without/involving ourselves
come
the
in
eliminate
dividend in¬
or
"double taxation" on
alternative
worse
of per¬
mitting indiscriminate accumula¬
tion of corporate profits is a ques¬
tion to which tax scholars have
given much of their thought and
not a little. of their emotion of
late.
So far a simple and easy
solution has eluded them.
How¬
have
three basic methods
been proposed. *
ever,
The first method would not tax
corporation but would tax
corporate profits as if the stock¬
the
holders
were
partners,
and
On
to
lave
•ation
be
thus
Corporate
taxed
managers
per¬
only once.
would
about the
There would
worry
tax.
not
corpo-
be
no
:orporation tax, and the desire to
nvest would be uninhibited.
Of
:ourse, there is some
he
constitutionality
itockholders
iot
on
received.
lumber
of
doubt as to
of taxing
income they have
There
are
also
a
technical and admin¬
hand,
nothing
en¬
courage investment at the greatest
cost in equity than the plan of
the individual stockholder against
dividends received.
It is heavily
weighted in favor of high-income
stockholders; low-income stocks
holders
harsh
be
small
with
and
medicine
new
for
enterprises
stockholders.
prosperous
would
out
come
the
at
justify tax and those which do
not. Any line we draw
may be ar¬
bitrary^ but the resulting classifi¬
cation wBl at: least be better than
our
present confusion.
Where should the line be drawn?
can
do no more than state a
I
income.
Where it
was not
appliec
to large corporations with sep¬
arate economic entities—I believe
relief should be given
a
substantial
favor
of
by making
differentiation
ir
corporate
profits whicl
are
distributed as dividends.
A
differential in favor of distributee
corporate earnings would partially
offset the existing premiym on the
guiding principle—a selection be¬
use
of
corporations
which
are
borrowed,
economically* not merely legally, equity* capital,
tween
thar
rather
stockholders
with
the personal
exemption level. The
stockholder
tax
to
all;
he
as
with
no
receives
pay
is
incomes below
It is not easy to decide what
form this differential should take
several possible tests for this
selection.
Do
the
stockholders
have a real voice in the formu¬
It is much easier to state the forrr
it should -not take.
I have, nc
are
lation of important corporate poli¬
characteristics — such
as
limited
liability of stockholders,
transfer of ownership and
easy
perpetual
life—essential
the
to
very manner of doing business?
These attributes suggest the eco¬
nomic separateness of the corpo¬
ration and justification for a cor¬
poration tax.
If they are missing
to a marked degree, the imposi¬
tion of a corporation tax is much
questionable.
more
I believe that
should
be
rations
which
>
a
substantial tax
imposed
corpo-
upon
classified
economic entities distinct from
as
their stockholders.
tax
be
may
no
is
which
dictate
source
of
no
potential
should be left
I cannot believe that
untapped.
it would
that
revenue
stifle
incentive
risk
to
investment, or that it would un¬
duly hamper management in its
price, wage and other policies,
particularly if a differential is
made for distributed
income, and
adequate provision is made for
offsetting losses and, perhaps, for
accelerated depreciation.
the
pay
high surtax brackets might
less combined corporation and
individual tax
on
distributed
cor¬
porate income than if he received
the
income
in
from
unincorporated
than he would pay
individual income tax alone,
business,
or
were
-
tax
-
system.
Whether
,»
,
*
or
not
ultimately
estate tax, our
s.ructure; should
If to
unavoidable.
from
some
extent
Revenues
somewhere
must
and
;
To
give
ment to
maximum
.
disastrous results. If
may
no-
be enough td provide a tax dif¬
ferential in favor of distributee
corporate
earnings.
differential
.
would
tribution
and
poration
tax
a
Although
promote
substantial
dis¬
cor¬
Getting
corpo
distributed is no*
to
even
*
of
any gift; of V
charity and at
a
A provision of
kind
would cap.ure the tax
end, although somewhat ■
tardily if no gift were made.; b :£
in
the
Conclusion
No
single
proposition
sense
or
makes-
nonsense,
considered as part
when
problem
as
whole.
a
except
of
the
Our
>.
tax
problems
jare only one part/ of a
problem our coun¬
try faces \oda.y. Our attitude, as
we
attempt to deal with these
problems, is of overriding impor¬
vast economic
•
.
tance.
that
We should not be
cannot
we
blind
solutions
that
see
so
inspired by special interests .will
take
forward.
us
Nor
.
/ will
undue emphasis upon the imme¬
diate desires of
a particular com-munity, or group in society,, or ;
industry, or unit of industry, giver
us the kind of tax system we im-* /
peratiVely needV No oneisegment;
of society is entitled to ride rough¬
shod over o.hers.; The end prod- '
ucts should be fair j. to all inter- /
ests and all groups. Yet too. often
when a proposal promises to work
to the present advantage of a par¬
ticular. group, human, frailty as?.'
serts itself.
It is perhaps the most
chilling commentary on our times
that
immediate
in
up
self-interest,
sophistry,
sonorous
all
factors
I
account.
taken
are
into
not so. unrealistic
am
for
to1 ask
as
an,
tude:which will
unselfish
atti¬
nobly surrender^
advantages*
You
are-
practical businessmen, not starryeyed idealists. But I do ask for
a
a
larger
manufactured
level
the
real
value
is
On this
a4
sound
fiscal system under which indus¬
complete solution to this com¬
try may thrive for years to come.
plicated problem. - In many case?
it is much better for the corpo¬
Opportunity is knocking;1 even
ration—and the economy—to re¬ pounding,; at our door. Today we
a
.
earnings for use in the ex¬
pansion of the corporate business
have- the magnificent opportunity
to achieve a level of
employment
and in
tain
ventures.
gnd living standards higher than
One basic remedy for this con¬
dition is appealing, however for¬
any we have ever known in peace¬
bidding the administrative obsta¬
stituted
cles
new
be*
may
If
we
,
a
time.
A
sound
as
tax. system,
part of
a
an
con¬
integrated;
social and economic program, will
help
us
ence
far better than any we have
toward patterns of exist¬
.s
yet attained.
.
credit
to stockholders—for investment in
nevj
If
we
edy,
additions, new in¬
be encouraged.
capital
would
vestment
resorted to this heroic
no
rem¬
II!
deduction should be al¬
SAN
lowed for the
correspondingly reducing taxes for enterprises that
undertake construction during pe¬
we would be
would
this
time
against short-run effects,
difficult.
ration earnings
also consider the Swedish plan o*
shrink.
the
the stock
tax £
perhaps a
treatment of any
corresponding
loss—at
a
gain—with
far-sighted attitude that « intel¬
ligently appraises advantages and
disadvantages.
I do ask for the
imagination; to balance long-run
the
products
a
earnings would minimize the us<
of corporations as instruments tc
undistributec
on
purchase of an old
plant but only for the construc¬
tion of a new plant. We might
for
the
upon
undeniable
t,
on consumption, consump¬
tion would necessarily decline and
market
feasible technique would be
when
encourage¬
risk, capital, it
the, earnings takes the form of
burden placed directly upon
individuals through the individual
income tax, or indirectly by ex¬
cises, might well produce even
more
contain
provision to stop this serious in¬
come tax leak.
I believe the most
general values, even though the
self-interest may be
misguided
.
differential in favor of distributed
tax at all.
in¬
many
will
In the end
ANTONIO, TEX. —Texas
National
Corp. has
with offices in the
to
engage
formed;
in the securities busi¬
Officers
ness.
been
Transit, Tower
Gus
are
-Nelson^
riods of business recession. These
President;
Attila
N.
handicapped in
Striegler,,;
achieving .our goals of high pro¬ expedients come so close to being Vice-President; and Edward Her¬
believe
they
duction, employment, and national subsidies* that I
man Keller, Secretary-Treasurer*
income. Enlightened self-interest should be adopted only if it is
almost impossibly
dictates that
of revenue
choose
we
on
the
our sources
absolutely necessary to stimulate
Mr. Nelson
mini¬
the expansion and increased pro¬
cer
basis
of
duction
that
are
•
was
formerly
an
offi¬
of Pitman & Co. with whictr
Mr. Striegler and Mr. Keller were
also associated.
-
•
corporations
to
j
too often cancel? out more remote
intensify
no
.
subjected
in
J
individual level would, in addi
is
no
•
at all.
gain
i
stock,
escapes
tion to its other faults,
that problem.
indispensable tc
mum: harm to the economy as a
a high level of income and em¬
corporation tax whofc
■
:l
* • 1:
f.
ployment.
I; would eliminate the corpora¬
Recommendations
tion tax—or charge only a nominal
Part of the problem of undis¬
It is pleasant to
franchise tax—for
think aloud
corporations tributed corporate earnings etemc
when problems are so complicated which in a predominate sense may from the fact that, from the stock¬
and solutions are so difficult. But not be classified as economic en¬ holders' viewpoint, these savings
thinking without at least tentative tities distinct from their stock¬ constitute untaxed capital gains.
decision is abortive.
In general, these would Other
Therefore, holders.
things being
equal,
the
with some misgiving, I am going be small corporations with a lim¬ value of stock rises as undistrib¬
to offer a few suggestions about
ited number of stockholders.
The uted corporate profits accumulate.
the
place
the
corporation tax corporation tax. could be elimin¬ If a stockholder sells his stock,
should hold in our future Federal ated by granting these corpora¬ the undistributed
profits will be
if there
Although
this
dressed
dividend credit at th<
a
enterprise is cramped, the result
the tax would be a
on risk-taking than
course,
stiffer brake
share of the tax burden fell; more
individual income tax at the nor¬
But the stockholder in
granting
could alW
some deduction for purposes of the
tax on undistributed earnings—or
the entire corporation lax, if the
Of
heavily
mal, rate.
From the economi
standpoint these
two
method
would mitigate our over-savim
problem, while the method o
justified by the economic
advantages these corporations ;enavoid taxes, inside financing migh*
j oy and by revenue considerations
benefit at
just as heavily
the stockholder subject to the
stockholders.
gain
remain
A corporation
individual
taxed
be
tax
nou
separate from their stockholders
and those which are not. There
same
holders in high individual income
brackets and too little relief to
taxation.
stances
capital
either
come
of the
potential
which derive sufficient
advantage
from
economic
separateness
to
economic stick.
end
a
the time of death.
It gives too much relief to stock¬
short
even
vould
other
could be better calculated to
allow stockholders to
treat
corporate, losses as their
own.,
Corporation income would
be taxed directly to the stockhold¬
ers according to their holdings of
stock, whether the income was
distributed in dividends or not.
Income
from corporate, activity
haps
the
allowinga credit or exemption to
IMethods of Integrating Individual
would
some
stockholder does not sell his
Corporations of this type might b<
put at a disadvantage as comparec
partnerships, and many large cor¬ with larger corporations to whicl
porations with widespread owner¬ the partnership technique coulc
ship are much more than part¬ not be applied. On the other hand
nerships/In between are many the optional method presents man}
hybrid corporations which are technical difficulties which are 5
something more than partnerships long way from being solved.
and something less than economic
The partnership method of re¬
entities distinct from their stock¬
porting corporate income wouli
holders. The solution of the prob¬
give complete relief from "doubl<
lem begins with
drawing a work¬ taxation" and wipe out the dis¬
able
line
between
corporations crimination in favor of interest
-
have to be recovered from some*
it
porate
a tax on all
profits and treating it
withholding tax when divi¬
distributed; or, sec¬
ond, by crediting the corporation
tax on distributed earnings against
the personal income tax of the
the discrimination dividend
recipient.
of
of reporting
mandatory rather
than optional, but in the absence
of a stiff undistributed profits tax
made
as
This could be' done in two ways:
completely avoided. Furthermore,
if the corporation tax were elim¬
inated
and
no
provision were
:tnade for taxing accumulated cor¬
porate
profits,
unincorporated
business would be almost helpless
in
answered categorically for all
corporations. Economically speak¬
ing, many small, closely-held cor¬
porations are nothing more than
This method
could, be
sympathy for techniques whicl
concentrate
relief
in
the higi
cies, such as wage, price and divi¬ brackets. The
plan of allowing \
dend policies?
Does the fact of dividend credit at the
corpora!
incorporation bestow substantial level poses
many difficulties; thf
economic advantage, such as ac¬
withholding tax approach raise
cessibility to national, and perhaps many more.
But both method
world, capital markets? Are cor¬ could be made fair to low-bracke
an
the
which taxes had been First, by imposing
upon
be
ships.
corporate
sub-1
transmitted
of
and
taxes would make
for
prof¬
a
individual
seems
finally to resolve itself into
question of degree about which
me
'
are
tions
and
option
of
their
stockholders
reporting
as
the
partner¬
at least
indirectly subject to capi¬
taxation.
But if the
tal, gains
Ray Morreale Opens Office
Ray X. Morreale will engage in.
the investment business from of¬
fices at 685 East 183rd Street, New
York City. He was formerly man¬
ager
York
du
of
one
Pont
'co;.
of the up-town New-
City branches of Francis I.
1
&
Co.
and Granbery
_
&
*
"i
2690'
THE COMMERCIAL & FINANCIAL CHRONICLE
Federal Deposit Insurance and
Recent Banking Developments
■".;
much
to
nullify
any
^^/•i^habilitation;E^/^''?rS^^vs?;:v
'
c
>
Federal
has
insurance
deposit
nowbeen in operation for a little
over 12 years. During this period
'
th£ public
-
has
freed from
been
about the loss of their de-
concern
posits in banks. In this respect,
the' past
12 years have been
v
corporation
million
unique in the history of the coun¬
try. Anxiety
greater
state
bank:
super¬
visors.
to
$300
disbursed
has
depositors
protect
in
merged because of their insolvent Condition.
Payments to
were
was
lesser degree continu-
or
an
J_
liquidation.
involuntary
'
ance
men¬
gentlemen
are^
depositors.
keel,
even
to
taken
If
be
ment
and
will not be frozen
'
30, 1935, to Dec.
31, 1945, the corporation has lev¬
ied
high
level.
„
annual assessment
an
as
re¬
by bank suspensions. Consequently, the entire
economiC life of our country has
benefited. It now is free from the
Sudden crippling effects of bank
suspensions which from time to
,
.
the investment of its capital funds
time in
„;
permitted the corporation to ac¬ sion and
more
less regular cy¬
or
f
j
by Dec.
surplus of
1945, ah
earned
$640 million
which in addition to the original
capital of $289 million, makes a
are two ways in which
corporation provides protec¬
for depositors.. First, their
There
'the
tion
and
claims
balances
in
this
together with income from
cumulate
struck communities
throughout the nation.
k,'
not
source
cles formerly
'
nize the
insured
Income from
total
of
31,
capital and
Of
surplus
$929 million.,
insured
occasion
an
payments may be
indication
an
that
business
activity at a
However, it is our
duty to be realistic and to recog¬
quired by statute of 1/12 of 1%
on
the average total deposits of
banks.
such
management has failed in its at¬
tempt to maintain stable employ¬
might force them to close. In ad¬
dition, businessmen have been as¬
sured that their working capital
3une
en¬
gage in making widespread dis¬
bursements to a great number of
ever arises these
From
come
when the FDIC will have to
net loss will be infinitesimal com¬
an
are liabilities; It is not a
growth of bank, deposits but in a
sense an inflation of bank de¬
posits. The bank which has grown
to
relatively
the
banking
total
system or to his neighbor may de¬
rive some justifiable satisfaction
from.this
situation,
But
*
Further, the law was amended in
so as to permit financial aid
1935
by the corporation to facilitate a
weak bank with an¬
institution, rather
than pay off the insured deposits
through an involuntary Jiquidation. In such a consolidation, ac¬
of
merger
K
ceptable
i
a
insured
other
bank
are
assets
the
corporation have
rapidly
not
as
billion at the end of 1934
as com¬
with
pared
approximately $157
the end of 1945, an in¬
billion at
crease ; of
almost
transferred to the
ab-
ation
during the
Total
300 %.
the merging capital and surplus of the
of
grown
have the deposits of
insured banks;
Total deposits in
insured banks amounted to $40
as
same
corpor¬
period in¬
$929
creased from $292 million to
V- sorbing bank while the corpora£>. tion makes available enough cash million, or 218%. As a result, the
ratio of capital and surplus of the
k ?<> that the value of the quality
assets and cash equals the amount
of the liabilities which the absorbf
ing bank assumes.
In extending
financial aid in this manner, the
corporation may either make a
loan secured by assets of one or
both of the banks
it may pur-
or
V
chase the substandard assets from
'£
them.
t
provision of; law protects all the
The
of
use
this
optional
.59% as com¬
pared with a high point of .83%
on Dec. 31, 1938.
1945, this ratio
and its
possessions, 13,495 or 92%
on
Dec. 31,, 1945.
insured
were
i
t
y.
which 19
without disruption to the business
;
Jan.
life of the community involved.
Furthermore, the corporation is
not restricted in liquidating the
■\
a
assets
it
has
acquired
in
the
y- process of facilitating a merger as
?
is the receiver of a closed bank.
Such assets may be held until
| their sale will not upset
f
way
f
bility
threaten
the
they
or in any
economic
community,
the
of
which
be
can
sta-
after
liquidated
gradually, but profitably from the
standpoint of the deposit insur¬
ance fund. Consequently, the procedure of making advances to fa¬
cilitate
a
merger
provides U in
many ways a more flexible and
advantageous method of liquidat-
4
ing
;
the
bank
affairs
than
does
of
an
insolvent
placing
it
in
a
These
in
have-been
awe re
of
possibility thai if
we do
public problems in a
manner ad j usted to changing con¬
ditions, days of business depres¬
meet
be with
bank failures may again
It is to the interest of
us.
ers to feel that they have made
a
great accomplishment by par¬
ticipating in this general increase
in' bank deposits.. The rise on ac¬
in
were
operation before
87
banks
insured
which
ceased
operations during the year, either
through voluntary liquidation or
merger.
Please note again that
there
were
no
failures in 1945.
Importance of Bank Examinations
,
The
tance
FDIC
of
recognizes
bank
the im-
examinations
for
the purpose of preventing a few
careless bankers from subjecting
their depositors and the corpora¬
tion to inordinate risks.
Conse¬
bankers
and
the
banking system
generally, as represented by the
fund, the corporation carefully re¬
views all examination reports of
institutions
.
which
are
by the
lated to the question of how we
could
from
convert
a
war
to
a
of
count
the
war
was
necessary
However, tfre
development is not a sign of treihendous progress in itself and,
Until production speeds up, may
Well be looked upon by the bank¬
er
as
an
unavoidable headache.
of the great problems for the time
being is to prevent any further
increase of liquid funds in the
hands of the
said
public so long as the
(which the
public
funds
stands ready to
ing system in 1863. You here in
Illinois, however, were somewhat
more generous to your stockhold-
The
FDIC
should
stand
ready
to insure the quantity of bank de¬
the
than
ers
out in
the
1945
as
country,
dividends
•
•
•
bank
average
payings
some
$30 :
.
profits after taxes.
J As I
previously stated, there
seems little likelihood that bank
deposits will reviert to their
pre¬
war levels and the question arises
whether it would be good public
•
'
policy to require such ln«hehses in f
capital as to restore capital •
posits necessary to meet the needs
bank
of the
ratios
public under conditions of
high employment at stable prices,
but. sound: public policy; does not
permit the creation of a volume of
deposits that will promote infla¬
tionary price rises. These would
lfead vto
to
maladjustments harmful
the
general public and inci¬
dentally to the deposit insurance
system.
.
,
.
,
The most dangerous harbinger
;
of
a
substantial; inflation
tremendous
volume- of
is
funds
the hands of the people.
the
in
At the
end
of December 1945, cash and
deposits held by the public stood
at $136 billion as compared with
$58 billion five t years earlier.
Should they decide to use these
holdings to purchase the present
supply
of goods available the
pressure upon prices would be ex¬
ceedingly great,
to
whether
their
some
former
new
status
or
'
' standard
or
'
standards lUajV be developed.: New
{
standards^^ might simply -take they
of
form
establishing
a required
capital to total
minimum ratio of
funds at some'
new
level. ;■ On the
other
hand, some entirely differ- >
ent ratio, such as a ratio of capi- ;
tal funds to risk assets, might be *
suggested.
It should be recog- •
nized, however, that this problem ;
of capital ratio which is of such ;
great Interest to bankers is being;
likewise watched by both deposi- •
tors and the general public. Thus,
maintenance of a really significant
investment as represented :
by
capital
funds
invested
by t
bankers in their institutions is
in order to insure the
perpetuation of the present dual
necessary
,
Manifestly, the increased vol¬
ume of liquid funds would not
able success because of. their per¬
sonality; by
have
seen
the
token
same
brilliant
men
we
who have
ly^control'ihfiatibh andfcredit ex¬
pansion without crippling enterprise.
'
Bank
Now
let
us
from
pitfalls into which his en¬
thusiasm might carry him.
■
Capital
look
another
at
G. Parr Ayers
Joins Staff
Of Bacbe in Columbus
great tendency, and
rightly so, for bankers currently
to be proud of the growth of their
problem, namely the amount of
capital funds of insured banks. It
is a matter of primary concern to
this corporation.
For better than
a 100 years, and particularly since
institutions. Some note with satis¬
the advent of bank suoervision, it
with Bache & Co., 16
faction
has been
There
total
is
the
a
rise
footings
of
to
deposits
and
amounts
never
to give
mally $400,000 of deposits to observe that they, now are Va mil¬
member banks of the Federal Re-
for this purpose
since formation of the dual bank-
.
occasional
state
•
'
•
profits utilized
-
eral
for
and the greatest percentage of net
peacetime economy without either add to the inflationary process if been; failures: because of kinks iu
crashing into a deep economic said increase was accompanied their, personality^ The American ,
depression or experiencing a dis¬ by a decline in the desire of the banking, system, is no less depublic t6 spend their money. Un¬
ruptive inflation.
pendent, on good public relations however,
there
is than an individual is on his ability
As the war drew to a close, fortunately,
there seemed to be a prevailing every indication that the inclina¬ to make and retain friends^
opinion that the great danger was tion to spend is increasing rather
However, one of the greatest
one
of unemployment, declining than decreasing, As wage controls vehicles
with which to serve'and
and rationing disappear, the gen¬
income and business failure.' In a
build good solid public relations eral atmosphere ;becpmes increas¬
large measure those - fears have
ever to be created has been of- *
ingly one of spending rather than
proved as yet to be unfounded.
fered the bankiiig fraternity in
General opinion has come to be¬ saving.
the GI bill. Some 12,000,000 po¬
The real problbem, then, is to
lieve-that the chief
economic
tential borrowers, each with a '
prevent inflation. A basic device government
danger is One of inflation rather
guarantee
Up - to
than of deflation. It has come to would be to shrink deposits by
$4,000 in principal With a ,4% re¬
recognize that the public is in continually encouraging your cus¬ turn, add up to a lot of good busi¬
possession of an unprecedented tomers to invest in governments. ness and the -possibility of creat¬
Volume of liquid funds, that there More specifically, the self-inter¬ ing
a tremendous amount of good «|
is a tremendous demand for goods est of all of Us interested in banks wiII; feu't the
opportunity is -hot
and that the immediate problem and banking seems to require that without
its
responsibility.
The
is one of irtadequatte production we give our serious attention-to banker
jrhust help the veteran to
the adoptioh of public policies and
or excessive demand rather than
help himself into a successful
of unemployment. Therefore, one procedures which will adequate¬
caVeer ahd mUat-guide him away
depositors
examiners
This is both the greatest amount
.
before
Reserve
the-Capital account $637 :
or 70% of said profits^
.
spend) exceed the
quently, in the interest of protect¬ possible supply of goods.
ing safe, sound and conservative
in"
banking system. Sound bankers
the bankers whom
who have; the long run interests
Furthermore,, there
is
every
if represents to cooperate in se¬
of the system^at heari will waht txi1
curing. the adoption of policies, prospect that the liquid funds of be protected from the repercus- '
Which will make it unnecessary the public, namely, cash and bank; sions and ili effects which
might "
for the
corporation ever to be deposits, will continue to expand come to the aystem from»the
•
;
faced with a banking catastrophe in 1946.
tempts of a small minority of the
In this -conhectiobitit 'should be
such as that of the early 1930's.' T
bankers t6 dq business on a shoe *
noted that bank ldans have been
string and ah inadequate capitaL
Problems of jFPIC
increasing, rapidly ih the past six
Incidentally, we are all cogni- '
Now let's look at some of the ihonths. Business loans by banks
zant that bankers could be doing ■
problems which we at the FDIC reporting weekly have increased
ah excellent job in the perform- *
think require the cooperative ef¬ 25%. Receivables will no doubt
ance
of. their
strictly banking
forts of all of tis if banking is to continue to increase substantially
functions but still be so weak
as the demand for GI loans, con¬
continue in its present status.
from: a public relations point' o£
sumer
and business credit ex¬
^Because of the close relation be¬
view as to be constantly in danger .
tween
general economic condi¬ pands. As stated, any additional from a legislative standpoint. We
increase in bank loans will add to
tions, and the success of deposit
have all known men with modern '
the; total
insurance, we have been concerned
ate ability to achieve -considerWith those great public issues re¬ in the harids- of the public.
the FDIC and
Comptroller of the
Currency representing
national
banks and by the respective Fed¬
banking difficulties and bank fail-
During 1945, 122
1, 1945 and 103 began opera¬
tions after that date. There were
made
though
a
granted insurance, of
were
insured
that,
held
of all bank deposits
the country.
banks
It is indeed a tribute to FDIC
and to the common scr^e of the
public
institutions
insured
total of 95%
receivership.
"i
was
Out of a total of 14,725 operat¬
ing commercial and mutual sav¬
ings banks in the United States
deposits in the weak bank, thus
eliminating fear and uncertainty
on the part of the depositors both
large and small. It also permits
continuity of banking services
v
■
corporation to deposits of insured
banks has declined.
On Dec. 31,
the
average it is a mistake for bank¬
.
hanks are paid immediately when % Despite this substantial earned
bank is placed in receivership. surplus, the total capital funds of
a
on
tain
million,
ihilliqp out of *$64 million of net
pared with the service rendered
in keeping our banking system on
hand, it protects the depositors
and, on the other it protects the
hanks from disastrous runs which
'.
the above
tioned disbursements already have
been substantial. Thus the final
The function of deposit insuris two-fold.
On the one
,
■
on
deposits
[ It is particularly encouraging to
FDIC to; notice that in T945;
the
net, profits of all-insured
banks after income taxes amount- I
ed to $911 million and that the
management of same chose; to re¬
Us Of
levels of the past.
These
in every
never
Recoveries
.
all
throughout
.
year
after
and I do not believe that we will
see, a
reversion tp the deposit
•
bank
liabilities—because
from 25% in 1914 to 11% in 1940,*
only, about 6% today..
'
*
and is
asociates.
,
,
tal
y■:.;'Thursday* May 16, 1046'
ceived the .wholehearted support
and splendid cooperation of the
Hon; Arthur Lufeder and?his. fine
sense of the word, ren¬
insure depositors in the 245 banks
ally from the beginning of this
dering real service to the people
in
receivership
have of this
^ nation Until 1933. For example, in placed
great state. I know that
amounted to $87 million.
Total
the period 1892 to 1920 there was
they are held in high esteem by
not a year in which the country disbursements in connection With all members of your
splendid as¬
the merger of
153 banks have sociation.
experienced less than 30 bank
amounted to $213 million. These
The present period is not one of
suspensions, and the typical num¬
disbursements have afforded pro¬
ber
was
about
100.
However,
bank failures. The FDIC; -never¬
tection to all of the $390 million
thanks to alert and capable bank
theless, is a factor of major im¬
of deposits in the banks which
management during recent years,
portance in the economic struc¬
were merged and to most of the
ture of our country in that it in¬
plus deposit insurance, we find
ourselves today, May 2, 1946, at $110 million of deposits in the in¬ sures at all times the stability
f
sured banks which went into re¬
\ the threshold of the third consecu¬
of our banking system. We
hope
ceivership.
tive
that
the time will
without
;
<
or alternately with state examine*
tions and in the closest coopera*
tion with the
398 insured banks which closed or
potential or ac¬
present
in
over
failures
tual
usually made jointly
are
pures
(taken to facilitate our economic
\
inations
since 1933, the quiet yet ef¬
In
Illinois the FDIC makes
fective operations of the corpora¬
regular examinations of 349 banks
tion to protect depositors have al¬
and reviews the reports covering
layed all fears, have caused no the
examination
of
491
banks
runs on banks, and have, in fact,
made by the Comptroller of the
made an FDIC pay-off or merger
Currency and the Federal Rer
generally an occasion for thanks¬
serve. Incidentally, in examining
giving..
the insured state chartered banks
!
f During the last 12 years the
in Illinois we have always re¬
other steps
:*v/vV''■ ''•■•;
r,
serve^: System.. The corporation lion ;dpllar bank;" - Yes, we arfe
Makes; examinations of all other the only group of businessmen in
insured state banks. These exam-r America; .who. brag about our to¬
(Continued from page 2640)
jV
■•'
a
reached.
It
seems
great deal of pleasure
bankers
who
to some
formerly, had
considered fundamental
that bankers
maintain
should
an
<
;
'
^Special tp <TkE Financial
COLUMBUS,
CHRONids)
OHIO
—
'
George
Rarr Ayers has pscome associated
Street.
headed
East Broad
Mr. Ayers for many years
his
own
investment firm
adequate amount of canital funds
in Columbus. Prior thereto he was
to cushion their depositors
with
against
nor¬
asset
fluctuations.
capital
to
Tbo
deposits
ratio
bad
of
the
Huntington
Securities
Corp. and Maynard H; Murch &
shrunk Co.
FINANCIAL CHRONICLE
&
THE COMMERCIAL
TVoiufn'e 1*63 'Nfimber 4490:
2691
Come-Latelys who have read
!Fp0orrdti£s
Deale r-B roker Investment
to send interested
much of infla¬
so
all theif cash into; yati-coloted
Recommendations and Literature
X-ip.l'f
*;»:'.
can't
run
Writer for
If you
assurance,
Most of it want assurance better sell,
isn't even that.
It's just a and
then
ask
Walter
yourse 1 f
short form saying I'We haYe' if
you
want the s t o c k
this day bought for your ac¬ back aghin. You'll make mis¬
takes but if ybu keep at it
count and risk.
s=By WALTER WHYTE
long enough and look on trad¬
Coal rally dies aborning. An¬
In my last week's column ing as ah art (ifs not a sci¬
other rally indicated
tail I dPvoted some; space tb the? ence—if it werie: anybody ap¬
strike is avoided. Suggest Us¬ art of taking profits. I used plying h i m s e I f diligently
ing strength from here on to the word "Wart" deliberately. could master it) Which re¬
lighten' or dispose of long Taking profit takes a lot of quires nerves of steel and no
emotional attachment, you'll
positions.
^
\»
^ intestinal fortitude. It meatis
■
ii;<,-y.'■;;
engraved paper.
Whyte
will he pleased
It is understood that the firms mentioned
tion that
ture you
get points down you
to your broker,
they're busy turning neighbor or market letter
and heard
parties the following literature:
Says—-0
(Continued from page -2646)
Simplex Paper Co.—Descriptive
I
Grinnell Corp. —■ Memorandum
v~Boerining & Co., 1606 Walnut analysis discussion potential post¬
war benefits to the company from
Street, Philadelphia 3, Pa.
the
automobile,
building,
and
'•
* •*' i"' ' |T" ■*;
j,'
t;-''r*-1-1
frozen food ihdustries-LRaymond
v
Hammondj Instrument Co, —
& Co., 148 State Street; Boston' 9,
.Analysis—Caswell | &
Co.,
120
,t
'
"*
1
.Sduth
'r
V'
La
13, ill../
'
Salle
'
' 'J
:•
v
Street,
.*
/
.
Chicago
^
1
.
.67 Wall Street, New York 5, N.Y,
Bulletin
Lerner
&
Post
10
Co.,
-
Office
Square, Boston' 9 Mass.
of -^Hardy & Hardy,- 11 Broadway,
Company— Study
Common stock as
sound specu¬
a
4, N. Y.
deducts Engineering Co.
on
manufacturers of
Dumont Electric Corp.;
"Combustioneer,"
an
automatic
£ Princess Shops; Electronic Corp.; stoker-rJ, Roy Pro'sser & Co., 52
^District Theatres^ Coi^f Ohd Shn^ Wilbur Street*Ndw York 5, N. Y.
able
Steel
—Survey
on
pTicify Pattern.
McLaughlin, Reuss & Co., 1 Wall
Street, New York 5, N. Y.
, :v -■
Taylor-Wharton Iron & Steel
Co.—Circular—Ward & Co., 120
Broadway, New York 5, N. Y.
available
Also
cular—Herrick,
Ind,.
Waddell &
Street,
55
Liberty
"York 5, N. Y.
and
^Broa^way, ^Newy York 6, N. Y.
Midland
Realization
Company^-.
memorandum and bal-'
S Current
..
sheet---Doyle,H G'Connor^ic&
Co,j 135 South La Salle Street,
ancey
Chicago 3, 111.
*
.,
:
,
f;
,
t.
«
alysis
of
situation
current
<
<
United Printers &
phia, 2*
Publishers-^
Pa;<"|..;r::v,
■
anc
prospects for 1946—Comstock &
: Co., 231 South La Salle street
Chicago 4, 111.
:
1
available
Also
memoranda
are
Eastern Corporation and Stand¬
ard Stoker Co. <
'.
on
•
Co.
Descriptive Cir•>"ioT-^.<2pii«man. Lubekin & Co.,
41 BroadStreet, New York 4, N. Y.
?*' AlsoMetailed
xf# c tf I a r.s on
—
Tennessee Products; WCllman En-
gineering Goii ^^3hatteirproo»t: Glass.
,
\ff"l- M'!'Uhr^:*'n-''
U Nutidnai Gas? <fc,ElectricCorp.
-
—Late
memorandum
on
a
stock
offering combination of improving
utility income, together with excellent
speculative
possibilities
from oil developments—Fred W.
LFairmari & Co^203 SoutkLa: Salle
Street, Chicago At III.., j. . .^ -
Wellma'n
Co.—A
Engineering
study—Edward A. Purcell & Co.,
50 Broadway, New York 4, N. Y.
-
•
Holly Stores Stock
-
•
does
Pacific American investors, Inc.
j
j—Memorandum
>
on
M.
Market
Loeb,
the
Rhoades
&
Co.
ph)May 14 offered to: the phbiic
Boston 10, Mass.
on leverage trust
L-Kitchen &^ Co., 135 South | La
Salle Street, Chicago 3, 111.
•
Panama Coca Cola—Circular
on
stock ($25 par) and
100,000 shares
($1 par) common stock of Holly
Stores, Inc.
The preferred stock was priced
at $25
$10.50
a
a
ferred is convertible* at any time
into two shares of common stock.
Net
proceeds
from the sale
of
Interesting: possibilities
Lloit, all of the preferred stock and of
Trinity Plaice, 36,000 shares of common stock,
estimated at $li068,350 nfter un¬
New York 6, N. Y.
derwriting discount and expenses,
Pennroad
;>
^
-
>
Corpbration—Analysis
of investment company
with hold-
radfbadfndustbj^^xHeihiz
^€0
will revert to the company. Pro¬
ceeds
from
the sale of
64,000
.
Beaver
New
Street,
York
4,
Holly
r
Pump. Co.^-rStudy of situ-*
v; Reda
ation^-Syld und-
;Cov^i9? Rectof
Street, New York 6, N. Y.
'
Scheftley Distillers Corborktldtf
—Brochure of articles they have
been
running in the Chronicle-*Mark Merit,
write to
Schenley
350
Distillers
Fifth Avenue,
in
of
care
.Corporation
NOW Yofk 1
.
will go to
three present stockholders of the
company who agreed to sell that
amount f6 the underwriters.
concentrated largely in the Shares of the
ings
common
Stores,
heard is just
And
loaded
is
CHICAGO,
Prosser,
Rickey, 49
Street, New York 5, N,< Y.
&
ILL.
well
&
Street for the past
become associated
cago
25
LeSalle
Mr.
nounced.
has
years,
with
office of Bache
South
A.
LaSalle
on
the
Chi¬
& Co.,
Street,
it
Prosser
135
is
have
Sheller Manufacturing Cdfp.
—
report—Mercier, McDowell
Dolphyn,
tfbit 26,
Buhl
Budding,. De^
Mich/ 1.
...
H' V '♦
•" '
■.
do better than most.
merly with Fahnestock & Co. and
during World War II
Kenja
If you
You
can assume
vance
has hit
new
that
Kasai
has
served
•mmamami
Wadden Go.
Co.-with
Avanzada,
to
Securities business.
offices
engage
.
at
1
in the
an
ad¬
views
Whyte
in this
necessarily at any
time coincide with those of the
Chronicle, Then ctre
presented ds
those? of the author only.J
>
r
d6
eocpressed
not
real obstacle
a
rallies cannot,
or
make new highs. You
have almost a guaranty if on
subsequent declines new lows,
even if only by a point or so,
are
made.
will
give
you
NEW TORK 5, N.
the general
you
a.
specific pic¬
Following such a plan
ture.
CO.
99 WALL STREET
Studying the aver¬
will give
ages
LAMBORN
SUGAR
picture. Studying your stocks
Exports—Imports—Futures
'38;'i?-J'' •' •'
'•
^
,-V-VijJ
•:
If the pic¬
is lonesome work.
DIgby 4-2727
as.
Company,
Street
a
is
209
now
corporation.
liam
and
was
-
Pacific Coast
Incorporates
CHICAGO, ILL.
•
Kasai
formed
[The
article
up.
Thursday.
—Walter
major in the Army. Air Corps.
—
Established 1858
Wadden &
South
Officers
Securities
Salle
La
doing business
are
H. Hentz & Co.
as
Wil¬
Orders Executed on
Members
M.
Wadden,
Jr.,
President
Pacific Coast Exch^nses
NeW;; York"
Treasurer; Dayton H. Mudd,
formerly
and
Mary
proprietor
of
New
New
E.
Mr. Wadden
'ti'V-':.
Members
1:
"i—y—M—
v
.....
SAN
FRANCISCO,
Denault & Co., Russ
nounce
System
Teletype
,
-Exchange
Curb
Exchange
York
Chic
a
go
Cotton
the installation of a Bell
•;> And other Exchanges
W6w York Stock Exchange
Z
?
Chicago Board of Trade
14 Waft Street
COrtlandt 7-4150
San
rraneisco
Monterey
—
.•.
Teletypewriter, SF--272,
Inc.
Trade
Cotton Exchange
New York
•
S:, N. V.
Teletype NY 1-928
N. Y. Cotton
S
Exchange Bldg.>
NEW YORK 4, N. Y.
private Wires to Principal Offices
"an¬
of
New York Curb Exchange (Associate)
CALIF.—
Building,
Exchange.,
Exchange,
Board
Ne# Orleans
';,v;
>:■\ ■■;' ,«■ •.
.
'Stock
York
Commodity
Schwabacher & Co.
the
:
Denault Gets New
FRANCISCO, j; CALIF.
Securities
La
tell when stocks
,
(Special to The Financial Chronicle)
SAN
one
More next
and secondly,
stopped going
an¬
for¬
was
Kasai Securities Co.
Wall
[a
.
do not,
Stuart
—
known
Wadden, Secretary.
common
how does
mar¬
Johnny-
Jains Baclie & Co.
Vice-President;
Seaboard Air Line—Memoran¬
Recent
with
convertible preferred Stock of $25
296,000 shares jof
ex¬
take
shrugged off,
firm.
dum—Vilas
:
First of all taxes cannot be
when
1
<
another
excuses never
of 32.000 shares of 5% cumulative
par and
I
reason
Stoart A. Prosser
operates a
chain, of 64 retail stores located
principally in the ' Middle West,
South and East, selling principally
women's and misses' wearing ap¬
parel.
Upon completion of this
financing, outstanding capitaliza¬
tion bf the company Will consist
doesn't in¬
reason
The best
me.
From where I sit this
Inc.,
stock.
N.Y.
:
-c
the coal closing your ear's td the stories
was
place of profits.
ket
share and the common at
share. Each share of pre¬
Rose & vTroster, 7A
.
weeks. The
ever
NeW England Lirtie ctapsmy-v a new issue of
32,000 shares Of 5%
Descriptive
circular — Dayton cumulative convertible
preferred
'Haigney & Cd, '75 Federal Street,
-''
strike that was keeping, the everybody around is repeat¬ depend on hearsay, gossip,
emotional outbursts and news
market from going up.
At ing. It means that you hUve
to forget about the mysteridus columns, nothing I can say
least that was the widely ac¬
will help youL
cepted excuse. Get that set¬ "they" who Pre always put¬
^'51:'®SlSfl*
*
' ' 'SW
tled and everything would go ting 'em up or driving 'em
down. Because even if these
Trading has to be imper¬
iip^vvay up.
mythical "they" were doing sonal.: One way to impersonall these things' the chafices alize it is by the use of Stops.
Well, the miners were sent
of your knowing about them These are not infallible but
hack to work last Friday and
would be very slim;
they serve, a purpose if only
the market did go up. In fact
that they call for Selling at
the way it went up in the last
There is a much easier Why specified levels or when these
hour's trading of Friday was
to
determine for yourself levels' are yiolated,^; ^one; 6f
something to marvel at,.
when and What td sell. The the stocks you are holding
Stocks were bought like they
solution is right in the mar¬ broke through their stop lev¬
were being given away. Some
ket. It calls for independent els up to the time of this writ¬
of the order room windows
ing," .though a few, of them
looked like they were Selling thinking; dold daldUlating rea¬
soning which refuses to be touched the figures. So they
nylons. Steady readers of this
are repeated.
Lalso give you
column know what I think of swayed b y speeches from
biased
sources.
It
requires prices at Which to sell in case
this kind of buying. It has no
another upsurge occurs: Am¬
an
ability
to
arrive
at
sense at any time.
It has no
decisions by oneself for erican Gar & Foundry, stop at
sense how. Has it occrftred to
oneself.
Because the man 65; take profits at 69 or bat¬
all those buyers of Friday's
ter; buying pr i c e wa s 60.
hectic upsurge, who was doing sitting next to you is buying,
and maybe even making mon¬ Bethlehem, Stop at 101, take
the selling?
•
eys istio reason to believe that profits^ at ■«! 0!7 pr; betterbuy
tM road to advance is full of price was 99. Electric Autou So hOwtliecbal strikeiSpuf
green lights. It may be for Lite, stop at 71; profits at 77
of the way. By the time you
him, Fonyou thdy may bured. Or; betf^^ughtidt'M-* ^ £>u->
get this the railroads may be If taxes were eliminated from
perheater; bought at >30*, stop
on strike.
So what then?
I
market reasoning I would say at 31, sell at 33 or better.
don't know the answer. All
that the time to sell is When U. S. Rubber bought at 65
,
I know is that the market has
stocks have stopped advanc¬ stop at 74; sell at 78 or better.
not been acting too well for
♦
♦
#
ing. I know this sounds naive.
cuse.
Carl
*
'.i'V
,
Last week it
terest
-
♦
•
,
Upson
I Miller Mannfacttfring Co.—An
>
V.
N. Y.•
Memorandum-^Buckley Brothers,
15291 UWeinut
Street,'' Philadel
Midland Utilities Company and
I
Co
Carboh
Thermatomic
r
—Circular—Hoit, Rose & Troster
74 Trinity Place, New York j,
Midland Utilities Company
*
on
Hartford
'and
Co.,
New
,
Midland Realization Company —
; Analyses—Ira Haupt & Co., Ill
^
circulars
are
Rubber
Mohawk
Lipe-Rollway Corporation—Cir¬ Empire Co.
v
:
'^
New York
lative
purchase — First
Colony
Corporation, 70 Pine Street, New
York 5, N. Y. Special letters avail¬
■
•.);•'v.';'r
recent developments—
on
Sports Products, Inc.—Circular
Le &oi
,
.
Cement-
Portland
Spokane
Kinney-Coastal Oil Company—
Analysis—James M. Toolan & Co.,
'
—^
Santa Barbara
Oakland
Fresno
—
■
Sacramento
CHICAGO
DETROIT
11
PITTSBURGBf
-GENEVA, SWITZERLAND
.
THE COMMERCIAL & FINANCIAL CHRONICLE
2692
'
4
'
,«*;•
1'•
v'
'V
J
;,-V,
'
i.
"
,
'i5-'
v'
'•
*',
■
' '
''
'4
•!"
»-
Now
Securities
«'-V''"
•' J
'*
Thursday, May 16, 1943
'■ '
,
''
»r
••
V:'•
Registration
in
r.?,1''ys 'v:"r. '.-i v,-
7'
'.So.*;-1-;
INDICATES ADDITIONS SINCE
•
liiillil
t..
ii
Bardwell & McAllister, Inc., Los
Alaska Explorations, Inc., Seward, Alaska
April 26 (letter of notification) 1,000,000 shares (par
10(f),
Price, to public 100: per share.
No4 underwriter
selected at this time.Purchase of mining equipment,
YjfcV'rf
PREVIOUS ISSUE
•
Angeles
Electric
Calif.
V
Pwr. Co., Riverside, Cal.
(5/29)]
•
;
Barium Steel Corp., S. E. Canton,
(5/22)
April 25 filed 40,000 shares cumulative preferred stock
(par $100).
Dividend rate by amendment. - Under¬
writers—Lehman Brothers.
Offering—Price to public
by amendment. : Proceeds—$1,500,000 to reduce com-;,
pany's outstanding $3,000,000 3% sinking fund deben¬
tures to $1,500,000 and balance added to working capital.
,
O.
stock (par $1).
Underwriters—By amendment... Offering—Price to pub¬
lic by amendment.
Proceeds—Payments to and ad¬
vances to subsidiaries for working capital, for purchase
of equipment, repayment of loans, development, etc. For
details
see
.
All American Aviation Inc.,
Wilmington, Del.
issue of April 4.
•
The shares are being sold by certain stock¬
holders.
The price-to the public is $12 per share.
Unvderwriter—Atwill & Co. will act as agent in connection
with the
Caterpillar Tractor Co., Peoria, III.
t
(letter of notification) 8,000 shares of 5.4%
cumulative preferred stock (par $25).
Company is of¬
fering the stock beginning July 1, 1946 at $25 per share.
^Subscriptions will close Nov. 1, 1946,. Proceeds will be
used for incorporation expenses and as Capital in oper¬
ation of business.
Not underwritten.
see
Helicopter, Inc., New York
if
*
■
.
\
r
vt'1
v
m
nj_
'
-I,
•>
*') m1
■
March 21.
•
Inc.,
.
filed
Brockway
Probable bidders include
by amendment.
Dillon, Read & Co. Inc., White Weld & Co., and Shields
& Co. (jointly), and W. C. Langley & Co. and The
First Boston Corp. (Jointly).
Offering—Price to public
by amendment. v Purpose—The common stock, together
with $15,000,000 10-year 3%
be sold privately) ire to be
collateral trust bonds (to
issued to acquirecertain
Water Works & Electric, liquidate
Community Water Service Co. and
Ohio Cities Water Corp., and provide cash working capi¬
tal.
Common stock is tp be offered initially for cash
to common stockholders of parent and to public holders
of preferred stocks of Community and Ohio in exchange
assets
two
*
Chefford Master
field,
Stock not subscribed
For details see
or
issued under
to be sold for cash to underwriters.
issue of April 4.
are
'
•
Arapahoe Chemicals, Inc., Boulder, Colo.
May 7 (letter of notification) 800 shares 6% voting,
cumulative ;when earned : (par $100).
Price to public
$100 per share. No underwriting. Proceedsr-To build¬
ing chemical ■ plant, working capital, etc.
Arkansas-Missouri Pwr. Corp.,
April 23 filed 40,000 shares
Shares
are
holders.
being
sold
the
for
Underwriters—G.
Blytheviile, Ark.
common
H.
stock (par $5).
of five stock¬
account
Walker
& Co.
ward, D. Jones & Co.
Offering—Price
amendment.
Business—Public utility.
••
Aviation
Maintenance
and Ed¬
to public
Van "Nuys,
Corp.,
by
Calif.
(4/25)
May 6 filed 493,750 shares of common stock (par $4).
Underwriters—Livingstone & Co.
Offering-~Price to
,
Glass Co. Inc.
(Pa.)
etc.
City Investing Co., New York (6/3)
tion purposes, and to provide funds
of a construction program now in
for the completion
progress and one
contemplated to be commenced in the immediate future
by the sale of $34,000,000 general mortgage bonds and
100,000 shares of preferred stock. In addition, a $1,000,The company will re¬
000 bank loan will be obtained.
Proceeds—For machinery, tools,
furniture, fixtures, etc. and for working capital. Busi¬
ness—Sales service and storage of planes.
" •
,
pire June 3.
Price by amendment. Unsubscribed de*
bentures will be sold to underwriters to be offered the
sinking and
improvement fund bonds due June, 1, 1976, and 100,000
shares of cumulative preferred stock ($100 par).
Under¬
writers—To be filed by amendment.
Probable bidders
include Halsey, Stuart & Co., Inc. (bonds only); Harriman Ripley & Co., and Mellon Securities Corp. (jointly);
The First Boston Corp.; F. S. Moseley & Co., and
Otis &
Co.
(stock only). Proceeds—Company plans
to refund its entire outstanding long-term debt, to reim¬
burse iheivtreasury for expenditures made for construc¬
'
April 19 filed $4,800,000 convertible sinking fund de¬
bentures due June 1, 1961.
Underwrlting-*Fir$t^ Bbston
Corp.
Offering—Company is offering td. holders; of
common stock of record May 17, 1946, the right to sub¬
scribe for the debentures on the basis of $5Q0 of deben¬
tures for each 100 shares of common stock.
Rights ex¬
(5/23)
Brooklyn (N. Y.) Union Gas Co.
I May 3 filed $34,000,000 general mortgage
■
"
Proceeds—Proceeds will be added to working
For details see issue of April 25, p. 2262.
public.
■
capital.
.
Columbus
& Southern Ohio
(O.)
Electric Co®
(5/21)
April 19 filed 744,455 shares of common stock ($10 par).
issued and are owned by Continental Gas
Corp. which is selling them. Underwriters—*
To be filed by amendment.
Probable bidders include
:
Dillon, Read -& Co. Inc.; Smith Barney & Co.; Lehman
Brothers; Kidder, Peabody & Co., and Mellon Securities
Corp. (jointly). Bids Invited—Bids for the purchase of
the stock will be received up to 11:30 a.m. (EDST) May
Shares
are
& Electric
21 at room
1730,165 Broadway, New York, N. Y.
deem
$29,240,000 general mortgage sinking fund bonds,
3Y2% series, due Sept. 15, 1969, gnd $11,850,000 25-year
4% sinking fund debentures, due Sept. 15, 1969.
In
addition, $4,000,000 will Jbb used to provide funds for
the construction program now in progress and contem¬
plated, each involving the installation of additional pro¬
duction, pumping, storage and distribution facilities,
May
9(letter
of
notification)
($5 par). Price'to public $10
Parker Harrison & Co.: /
Compania Litografica De La Habana S. A.
(Havana (Cuba) Lithographing Co.) (20/27)
March
18
filed
19,419 shares of 6%
-
6,000
shares
cumulative con¬
vertible
and
preferred stock (par $25) and 197,000 shares
(par 10c).
The 19,419 shares of preferred
162,000 shares of common are being purchased by
the
underwriters
of
common
from
certain
stockholders.
The
York,
Issue of March 21.
—
☆
Corporate and Public Financing
SPECIALISTS IN
—
Underwriters and Distributors
United Slates Government Securities
State and
of
Corporate and Municipal
Municipal Bonds
'
:
Securities
::
'V'".-'V
'1% v-'$ vM1 ^1'/vV.'
'
ft
The
FIRST BOSTON
NewYork
•
Boston
•
■
■-•
Kidder, Peabody
'
;
CORPORATION
v
C. J. DEVINE & CO.
inc.
48 WALL
Chicago
Chicago and other cities
•
ST., NEW YORK 5, N. Y.
Boston
•
Cincinnati
☆
Philadelphia
«
St. Louis
»
•
re¬
; Underwriters—Hirsch & Co., New
Offering—Price by amendment. For details see
from the company.
common
share. Underwriter
per
☆
—
I
maining 35,000 shares of common are being purchased
Brooks Green Co., Boston
A
r
public $4 per share.
Manufacturing Co., Inc., Fair#
(5/27)
III.
preferred is $25 per share; price of common by amend¬
Proceeds—$300,000 will be used to discharge
bank loans, $60,963 to discharge machinery purchase
notes and approximately $909,694 for additional work¬
ing capital.
Business—Automobile replacement parts,
of American
exchange offers
?'
May 8 filed 40,000 5% cumulative convertible preferredl
shares (par 25) and 40,000 common shares (par $2)*
Underwriter—Cruttenden and Co.
Offering—Price of
April 24 filed 10,000 shares 5% cumulative preferred
stock (par $50). Underwriting—None.
Offering—Price
to public $50 per share.; Company proposes to offer
the securities to persons - living in Brockway and sur¬
rounding communities. Proceeds—Company proposes to
use
proceeds, with proceeds of loan of $1,250,000 as
follows: new building, $525,000;. new and used equip¬
ment, $575,000; leased, equipment, $250,000, and working
capital, 400,000.
subsidiaries,
for their shares.
Ind.
ment.
'
be
&
Central Indiana Gas Co., Munice,
N. Y.
V an additional number determinable only after the re¬
sults of competitive bidding are known. Underwriters—
To
Davis
H.
common stock. Under*
Co. and Union Securities
April 25 filed $3,250,000 first mortgage bonds. Bonds
will be sold; at competitive bidding with the interest
rate being named by the successful bidder.
Under¬
writers—By amendment.
Probable underwriters in¬
clude Halsey, Stuart & Co. Inc.; First Boston Corp.}
Stroud & Co.
Offerings-Price to public by amendment.
Proceeds—Redemption of first mortgage 3%% bonds;
construction fund.
For details see issue of May 2.
'
Bingham Stamping Co., Toledo, Ohio (5/20)
2,343,105 shares of common (par $5) plus
March 30 filed
''
Corp., Chicago
writers—Paul
April 29 filed 100,000 shares 5% cumulative convertible
preferred stock
(par $10).
Underwriters—Wm. J.
Mericka & Co., Inc., Cleveland, and Goshia & Co., To¬
ledo.
Offering—Price to public is $10 per share. Pro¬
ceeds.
Financing of acquisition of a majority stock
interest in Herbrand Corp. of Fremont, Ohio.
For de¬
tails see issue of May 2.
i
>
'
Corp.
Offering—Price by amendment.
Proceeds-^-To
provide in part for expansion program, etc. For details
see issue of May 2.
15 filed 702,302 shares of capital stock value
(par 1 peso, equivalent in U. S. currency to 50 cents
per share).
Underwriters—Allen & Co. The shares are
part of a total of 852,302 shares purchased by Allen
& Co. from five stockholders.
Of the 852,302 shares,
150,000 were sold privately at the cost price to Allen
& Co,
Purchase price to Allen was $2.10 per share.
Offering—Price $3.50 per share. For details see issue of
R. I. (5/31)
(5/20)
issue of May 2.
Celotex
.
Co.,
re*
April 26 filed for 100,000 shares
Benguet Consolidated Mining Co.* Manila, P. I.
of 4Y2% cumulative con¬
$50) Underwriters—G. H.
Walker
&
Co.
Offering—Common stockholders
of
record May 9 have the right to subscribe to new pre¬
ferred at rate of one share of preferred for each four
shares of common held at $52 per share. Bights expire
May 29. Unsubscribed shares will be purchased by un¬
derwriter.
Proceeds—Proceeds, together with a term
loan of $1,250,000 and current funds will be used to
finance the purchase of a plant formerly belonging to
the Defense Plant Corp. for $1,750,000, purchase of ad¬
ditional machinery and equipment and for other plant
Improvements. For details see issue of April 4.
Amerian Water Works
the
Webster Securities Corp., and Harris Hall & Co. (Inc.),
Offering—Price to public by amendment. ; Proceeds—*
Expansion of company's plant at Peoria. "For details
March
March 29 filed 21,550 shares
vertible preferred stock (par
■
to
At
•
stock (par 50c).
Shares are being sold for the accfront of the estate of
Vincent Beridix, deceased.
Underwriters—Kobbe, Gearhart & Co;, Inc., For details see issue of Feb. 20.
14
American Screw Co., Providence,
applied
May 1 filed $20,000,00010-year \zk% debentures. Under*
writers—Blyth &• Co., Inc.; Dean Witter & Co.; Stone
offering.
Bendix
Philadelphia
Allied Investm't & Discount Corp.,
be
funds.
Belcher Oil Co., Miami, Fla.
Feb. 13 filed 507,400 shares of common
May
will
demption of $16,000,000 first mortgage bonds 3V2% series
and premium on bonds $1,000,000 and balance to general
(par $10).
April 24 (letter of -■ notification) 3,602 shares common
(par $1). OH ering-i-Solely: 6hd,explqsiye^
end officers of the corporation, f pursuant to resolution
of stockholders, adopted in September, 1945.
ProceedsWorking capital.
.Proceeds—Proceeds
ment.
May 3 (letter of notification) 6,710 shares common stock
•
Probable
Dillon, Read & Co., Inc.
(bonds); The
First Boston Corp.; Halsey, Stuart & Co., Inc. (bonds);
Kidder, Peabody & Co., and Stone & Webster Securities
Corp. (stock).
Offering—Securities will. be offered for;
sale at competitive bidding.
Price to public by amend-*
March 30 filed 350,000 shares of common
2.
For details see issue of May
derwriters—Names to be filed by amendment,
bidders include
development^-etc.:/'^^^;-^/;^
Aldens, Inc., Chicago, III. <
May 10 filed $16,000,000 first mortgage bonds due June
1, 1976, and 169,636 shares common stock ($1 par). Un¬
May 3 (letter of notification) 50,000 shares common (par
$1). Price' to public $6 per share. Underwriter—Cruttenden & Co., To increase working capital.
■ *
HAnovpr 2-2727
Pittsburgh
*-
San Francisco
'
Members
Cleveland
;
■;.
New York.
-*•
Founded 1865
Co
>7;;^-.:^*:,
-'v:?'
of the New York and Boston Stock Exchanges
Boston
Philadelphia
Chicaoo
(Volume 163
•
^
Number *4490
THE COMMERCIAL & FINANCIAL CHRONICLE
10;
2693
Corcoran, Inc., Stoughton, Mass.
May 13 (letter of notification) 1,000 shares preferred^
(par $100). Price to public $100. Underwriting—None. 4
For working.capital..
; '
''
,
r
New Issue Calendar
.
•
May 16, 1946
v;
Monroe Gasket &
-
stock
'
owned by Colum¬
; : New York
Piper
;.
Motor
Car
Co.,
Chicago,
Aldens, Inc.
DuMont
N.
J.
May 31, 1946
June
Common
&
Powdrell &
U. S. Airline,
Preferred
.City: Investing'
--Common
"(J. M.) Grocery Cp.-*i~*W*——Preferred
L
(Allen B.V Laboratories, Inc.. Passaic,
(5/20-22)
common
are
stock
.
Price by amendment.
Proceeds—To expand television
broadcasting and manufacturing facilities and operation
in the low-frequency fields.
For details seeissue of
April 4. '
Emery Air Freight Co.,
/
Inc.,
Wilkes-Barre,
Pa.
,
ufacture
cases,
sale
of
Business—Man¬
Fleetwood /refrigerated display
be offered at $5 per
derwriter stock purchase warrants at
50 per warrant, /
entitling underwriter to purchase 55,000 shares of com¬
mon s.ock at 200 per share.
Proceeds—For working
capital in connection with inauguration and establish¬
in "
Delaware April 22, 1946, proposes to engage in pick-up
freight at various points throughout
the United States.
Flying Freight Inc., New York
(5/25)
May 6 filed 300,000 shares common stock (par $1). UnOffering—Price to
public $3.50 per share/ Proceeds^-Proceeds will be used
for, the purchaSe of Six'land planes, teni flying boats, re-^
conditioning of flying boats and working capital. Busi¬
ness—Company was incorporated on March 9, 1946, to
operate as a charter air carrier:
:
'
derwriters—F/ Reilly & Co,^ Inc.
Food Fair Stores,
Corp., Detroit
April
17 filed 17,000 shares common stock (par $5).
Shares being sold by officers and employees or their
relatives.
Offering—Shares may be sold from time to*
time upon the New York Stock Exchange or the Detroit
Stock Exchange by the owners of such shares. For de-.
tails see issue of April 18.
Faircraft Corp.,
Dansville, N. Y.
May 8 (letter of notification) 1,575 shares 7% partici¬
pating preferred, non-cumulative:(par $10} and 725 *
shares of common
(7% dividends, non-cumulative)?
par $1. Price to public $10 per unit. No underwriting.
•
First
Thought Mine Corp., Orient, Wash.
(letter of notification) 500,000 shares, par 10
cents, Price to public 20 cents per share. Underwriters—
May 8
E. J. Gibson & Co. Preston & Raef and Ben Redfield.
Inc., Philadelphia
April 29 filed 40,000 shares of common stock ($1 par),
issuable upon exercise of options to purchase common
stock.
The options to purchase common stock entitle
the holders to purchase between Sept. 5, 1946 and Sept.
4, 1950, shares of common stock at $19.50 per shdr6.
The options were granted on Sept; 5, 1945. Proceeds—
In the event that all options are exercised, corporation
Will -realize $780,000, which it intends to; use for in¬
creasing inventory, acquiring and equipping additional
supermarkets,1 warehouses, etc.
Business—Food stores.
•
Franklin Simon & Co.,
Inc., N. Y.
(6/3)
May 14 filed 50,000 shares of cumulative convertible pre¬
ferred (par $50) and 70,000 shares of common (par $1). Of
the total covered, the 50,000 shares of preferred and 60,000
shares cf; common - will be offered/ to the; public, and
; 10,000 shares of common will be offered at $20 /per share
to certain officers and employees.
Underwriter—-W. E.
Huttqn & Co.. Offering—Prices to public by amendment,
UNDERWRITERS—DISTRIBUTORS—DEALERS
■i
t
.•.'4'S'.z
V-
>.'•
;; 4V?V
V'-;'
p
Industrial, Public Utility, Railroad
and
pany's 7%' cumulative preferred;. The preferred will be
redeemed at $115 per share and accrued dividends/ Atlas
Corp., parent and controlling stockholder of Franklin
Simon, owned as of April 15, 1946, 15,030 shares of the
7% cumulative preferred $.ock.
Business—Operates
specialty store.
The Marine Midland Trust Company
•
May 29 to authorize 30,000 shares of new preferred s/ock
portion of which is included in the registration state¬
Dividends rates on" preferred stock offerings by
/ Underwriters—Kidder,
Peabody & Co.;
a
ment
amendment.
Goldman, Sachs & Co., and Ball, Burge & Kraus. Offer¬
ing—Price to public by amendment. Proceeds—Proceeds
will be added to the corporation's general funds and
Will be available for the reduction of bank loans, which,
amounted at March 31, T946 to about $9,000,000, the
reimbursement of the company for expenditures made
acquisition of interests in related business and
working - capital.
Business-r-Tires and
tubes for automobiles and buses,, etc.
*
■
; ,
•
in
the
additional
for
/
NEW YORK
J
PHILADELPHIA
.
ALBANY
PITTSBURGH
,
(Continued
.
•
Registrar
•
TRENTON
2694)
„
Trustee
.
Underwriters, Distributors
NEW YORK 15, N. Y.
;;
Exchange
CHICAGO
on page
Lee Higginson Corporation
ONE HUNDRED TWENTY BROADWAY
Members New York Stock
(6/1)
General Tire & Rubber Co., Akron, O.
May 13 filed 25,000 shares of cumulative preferred stock
(par $100) and 25,000 shares convertible second pre¬
ferred stock (par $100).
Stockholders will meet on
INVESTMENT SECURITIES
Hemphill, Noyes CS, Co.
'
(5/22)
OF NEW YORK
Municipal Securities
Transfer Agent
.
Corp., Chicago, 121.
May 3 filed $1,250,000 15-year 4% subordinated deben*
tures, Series B, and 60,000 shares 4% cumulative con¬
vertible preferred stock, Series C (par $50) and 180,000
shares of common (par $1) reserved for conversion of
preferred. - Underwriters
Paine,/Webber, Jackson &
Curtis.
Offering-r-Price; toipublic by amendment /Pro¬
ceeds—To retire outstanding 6% cumula ive preferred
stock, 'Series B, $761,000; -remainder approximately $3,294,000 will be added to general working funds.
For
details see issue of May 9.
.
;
INDIANAPOLIS
WASHINGTON
wilt
redemption of /21,339 outstanding
treasury; shares) ; of
the ^com¬
dispensing and cooking equipment.
and delivery of air
Eureka Williams
stocl€; together / With" part of; working Capital
be; applied to the
shares/ ' (exduding
General Finance
Co., New York.
Offering—To
unit. Corporation will sell to un-5
Business—Company organized
and
Proceeds—Proceeds from sale of the preferred and com¬
mon
May 9 (letter of notification) 91,767 shares of common
stock, of which 75,267 are being sold on behalf of the
company and 16,500 shares on behalf of selling stock¬
holders. ^Undei^ritersrAmos Treat & Co.; McAlister,
Smith & Pate, Inc.; Irving <T. Rice & Co., and Weil &
Arnold. Offering—To be sold ;to public at $3 per share,
&
business.
Fieetwood-Airflow,
(5/16)
Proceeds—General corporate purposes.
New York
May 13 (letter of notification) 55,000 units, each unit
consisting of one share 250 convertible preferred stock
(par $1) and one share of common stock (par 200).
Underwriter—Gillen
6T
being offered
by underwriters. /Underwriters—Van Alstyne,
/Noel & Co. and Kobbe/;Gearhart/& Co., Inc. Offering-
•
1946
Co.i'-i--.-Ji-.^i-.-bebentures^
Franklin Simon & Co., Inc.-Preferred and Common
Steep Rock Iron Mines Ltd.—.
Capital Stock
United Investors Corp.—Trust Fund Certificates
z Uhited CigarrWhelan Stores Corp.——Preferred
J HansO|i^Vah Winkle-Maniiing CcLUDebs. and Com/
Radford
....Debentures,
Inc.-------------.—..——Common
June 3,
■'Michaels Brothers
Inc.—.—Common
Alexander, Inc.-..-.—.—-—-Common
United Grocers Co
....—Common
.............
1, 1946
Houston Oil Field Material Co.
,,.'4
May 23, 1946
-
.Preferred
General Tire & Rubber Co;^....^...1.—Preferred
..—Bonds and Preferred
.
4; Trailmobile Co
for sale
of
Cigar-Whelain Stores Corp........Common
American Screw Co......
22^1^p:f|f■
■
of
<par 10 cents), of which 525,000 shares
ment
United
Brooklyn Union Gas Co..—
Bonds and Preferred
Crampton Mfg. Co...
.-..i...-.i.....Common
March 29 filed 650,000 shares of class A
•
May 29, 1946
..-.-w.--.^.i,^w*w-i--:iPreferred
4 V(12 Noon EDST).
T*; Liebert & Obert
..Common
——..—...4...-
California Electric Power Co.! .Bonds and Common
^>Hoffi^an;Radio Corp,.....^^.i..^^^
j Jersey Central Power & Light Co.—
III.
—Bonds
...
^^w^iU.L-.-.^iDebentnres-:
Spiegel, Inc.
General Finance Corp..—.—Debs., Pfd, and Com.
.
notification) 8,141 shares common.
Price to public $28 per share.
No underwriting.
For
•{working capital.-"
t
Pittston Co.
——..—Common
May
.Preferred and Common
May 28, 1946
:
4; Thomas $teel Co.——.Preferred and Common
Diebold, Inc., Canton, Ohio
(letter
Co...l
York County Gas Co....
May "21, 1946
March 29 filed 60,000 shares of -common stock (par $2),
Shares are being sold by certain stockholders. Underwrit¬
ers— Hallgarten & Co.
Offering—Price based on market.
For details see issue of April 4.
7
National Bellas Hess Inc.—....——.....Common
AircrafiCp|i.^-^r™^^^.-...Pref erred
'
Debentures
(EDST)——
a.m.
Paulsboro Mfg.
Columbus & So. O. El. Co. (11:30 a.m. EDST) .Corn,
Neiman-Marcus Co
.Preferred
May 3 (letter of notification) 1,000 shares $2.50 (no par)
first preferred.
Price to public at the market, or ap-p.
proximately $44 per share.
Offering by International
Trust Co., Denver. The securities are to be sold either
^direct through International Trust or through Garrett- Dromfield & Co.
(11:30
Namm's Inc. -..---------......-...-...-Common
StockscRic.^.......-^::Spedal Stock
Public Flyers,
Inc..—...—Preferred and Common
Mountain States Tel. & Tel. Co.—
Preferred
;1V' L'Aiglon' Apparel Inc.—:u—-Common
Denver Tramway Corp., Denver
May
Miles Shoes,
Miller-Wohl Co...—...Preferred and Common
Caterpillar "TfSctor "Co.......
Debentures
Havana Lithographing Co
.Preferred
DuMont (Allen B.) Laboratories, Inc.—Class A Com.
& Harrison Wholesale Co........
...—Common
J, Heyden Chemical; Co^./.ilw.^^».;-^iw-Prefei*]red,;
Hytron Radio & Electronics Corp.*—-.——Common 1
"
.^4:'; T.:
May 27/Y946
May 18, 1946
ijfeblders4/4;4//4^
•
Chefford Master Mfg. Co...Preferred and Common
Midland Cooperative Wholesale
——Preferred
t
bia Gas;& Electric Corp.•;and (per amendment'filed';
May 12) will be offered to underwriters at competitive 4
bidding.; Stock will not be offered to Columbia stock- f
Diamond T
Preferred and Common
May 20, 1946
($7 par).;
Underwriters—To be named by amendment.
Probable/;;
bidders include Morgan Stanley & Co., and W. E. Hutton & Co. (jointly); Blyth & Co., Inc., and Lehman
are
/Flying Freight Inc.4.^--;-..-^^i.-./.-:.---Commoii
Bingham" Stamping Co.—...——
,
Dayton Power & Light Co.
Offering—The shares
..—Capital Stock
Minneapolis-Honeywell Regulator Co...-Preferred
,
Brothers.
Mfg. Co.—
May 17, 1946
-
common
Aviation Maintenance Corp....—...—..Common,
McGraw (F. H.)& Co..
May 13 (letter of notification) 9,000 shares of preferred 4
stock (no par).
Shares will be sold direct by the comJpany at $10 per share./ Proceeds for purchase of ma- chinery and1 working capital.
No underwriter.
May 1 filed 1,530,000 shares
May 25, 1946
Fleeiwood-AirfIow,Tnci
Daunt Corp., Brooklyn, N. Y.
\
(Showing probable date of offering)
/'
Crampton Mfg. Co., Holland, Mich.(5/23)
May 3 filed for 240,000 shares common stock ($1 par).;
Underwriters—Baker, Simonds & Co. Offering—Price
to public by amendment.
Proceeds—Purchase of addi- §
tional machinery and equipment and to increase work¬
ing capital, business —* Commercial die-castings and >
hardware for plumbing fixtures, etc.
<;&
RECTOR 2-2200
and Dealers
:
;
■:/
NEW YORK
BOSTON
CHICAGO
rm COMMERCIAL & FINANCIAL
2694
Thursday, May 16, 1946
CHRONICLE
.fi¬
■,
will be offered for subscription to common
(Continued from page 2693)
\
Giant Yellowknife Gold
Mines, Ltd., Toronto, Ont.
shares .($1 pat, Cana¬
dian).
Shares are being offered to residents of United
States and Canada by Toronto Mines Finance, Ltd. These
snares are part of a recent offering of an aggregate of
525,000 shares offered by the company in Canada to its
own shareholders at $5
(Canadian) per share. Under¬
writers—Toronto Mines Finance, Ltd., 25 King Street,
West Toronto, is named underwriter. It is wholly owned
and controlled by its parent company, Ventures, Ltd.
Offering—Price is $5.10 (Canadian) per share, or the
United States equivalent.
For details see Issue of
oh Feb. 21 filed 81,249 common
Feb. 28.
Ontr
.Porcupine Mines, Ltd., Toronto,
Gold City
stock (par $1)
Underwriters—No underwriters
named.
Offering—Company is offering common stock
to public at 50 cents U. S. currency per share.
If com¬
pany accepts offers from dealers to purchase the stock,
company will sell to such, dealers, if any, at 32.5 cents
U. S. currency per share for resale at 50 cents U. S.
Jan.
600,000 shares of common
filed
4
Canadian
currency
currency.
share.
per
Trenton, N. J.
Goodall Rubber Co.,
1,000 shares of 5% pre¬
(par $100). Proceeds will be used to par¬
tially replace cash used to call 7% preferred stock at
$100 per. share ($161,700 cash used).
No underwriters.
Company will accept subscriptions on basis of two shares
of 5% preferred for each three shares of 7% formerly
held.
Price par and dividend.
May 6 (letter of notification)
ferred stock
Great Circle Airways,
•
Inc., New Orleans
$1).
Price to public $5.
Underwriters-^KohlNewburger& Co.; D'Antoni & Co., and T» J.
Feibleman & Co. For equipment and working capital.
by
>
"
Transports Co., Jacksonville, Fla.
Jam 17 filed 270,000 shares of common stock (par $i)./
Underwriters—Allen & Co. have withdrawn as under¬
Offering—Price to the public by amendment.
writers.
initially to present shareholders
filed by amendment. Holders of ap¬
proximately 200,000 shares have agreed to waive their
preemptive rights. Postponed indefinitely. For details
Stock is being offered
at a price to be
issue of Jan, *24.
see
*
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,
if
<
„
j,
J'--*
>
"
"
Hy-Piire Laboratories, Inc., Cincinnati
-
publication.
May 7 (letter of notification) 3,333 shares of common.
Offering being made by Elsa S. Joseph.
Price to the
public $30 per share.
The principal underwriter is
National Guild of Hy-Pure Druggists, a national akfcociation of druggists, which is acquiring the securities
on behalf of various members of its organization.
:
?
Hytron Radio & Electronics Corp.. Salem, Mass.
t
'
•
,
I;
Industrial
•
common stock (par $1)*
being sold by two stockholders, Albert L.
Arenberg, President, 73,000 shares, and Louis Sisskind,
Vice-President and Secretary, 12,600 shares.
Under¬
writers—Brailsford & Co.
Offering—Price to public
$9,625.
Shares
v
^
r/,'y
_
are
^
v
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1
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'*vJ*
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-
11A
./w, '
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,
Machine Products,
Mich.
r
/
International Paper Co., New York
stock and
an
indeterminate
number of common shares
Dividend rate on new preferred will be filed j
toy amendment. Underwriting—The securities are to be
tofferedtfor exchange andnouhdertotingdiscounts or
commissions are to be paid in connection with the of¬
fering. Offering—Company proposes to offer holders of
its cumulative convertible 5%
preferred stock (par
an indicated fractional share of
for each share of 5% preferred.
For details
preferred and.
v
shares of common stock ($2 par).
being sold by certain stockholders.
Under-
are
ters—To
named
be
by amendment. Offering—Price
to* public by amendment. Stop order hearing continued
by the SEC to May 13. For details see issue of March 7.
Jefferson Lake Sulphur Co.,
90,000 shares cumulative preferred stock,
Offering-~jPrice to public by amendment.
Proceeds—$4,983,000 will be applied to redemption of 38,000 shares of
4% cumulative preferred series A and 10,000 shares of
4% cumulative preferred series B and $2,500,000 to pre¬
payapromissory note. For details see issue of May 2.
,
i
Underwriters—A. G. Becker & Co., Inc.
Midland
,
,
Hoffman Radio
and
stock
bark
■)
a
formula.
For working
i" <
see
*
Miles
.
>*
' t
Houston
\\
'4
,Cv"
u *
(Texas
) Oil
v 1 ■'
!
Field
,i
J
AM
-.j1!
Material
Co.,
,
poses.
Inc.
public $6.50 per share, r Proceeds—Purchase of new.
machinery and equipment; new plant, etc. For details
see issue ot April -18.,
to
Proceeds—Proceeds will be used to augment the
company. The additional working
capital is presently intended to be utilized primarily to
retire bank indebtedness.
business.
,
Hudson Motor Car
■
Business—Oil well supply and
\
.
'
1
•,
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4
.
Co., Detroit, Mich.
April 26 filed 226,973 shares of common stock (no par).
.Underwriters—W. E. Hutton & Co.
Offering—Stock
^public wil! range fi'ona:
New York (5/27-28)
recapitalization of the company in . May. Underwriters/
—Werlheim & Co., and Lehman Brothers.
Offering—,
Price to public will be filed by amendment.
,
Miller-Woh! Co., Inc.; New
York (5/27-2S)
cumulative convertible.
preferred (par $50) and 50,000 shares: common stock (par 50^),
The common stock is outstanding and is;
April 29 filed 40,000 shares Alk%
For details see issue of May 2.
Regulator Co.,
\
Minne¬
April 17 filed 85,700 shares of 3.20% cumulative con- r
vertible preference stock, Series A (par $100) and 114,- r
267 shares of common stock reserved for conversion ol
Series A preference stock;
Underwriters-^-Union Se-*»
Offering—New preference stock is being*
of outstanding preferred stocks J.
in an exchange offer which expires May 18.
Unsub- .
scribed shares Mil be sold to underwriters who will
offer them to the jpublic at $108 per share. Purpose—To"
refinance preferred stock. For details see issue of April**
curities Corp.
offered
to the holders
m
.
Mohawk Foundries, Inc.,
•
■:
Garfield Heights, O.
May 7 (letter of notification) 1,750 shares cumulative;
preferred {par $100) and 1,750 shares common (no par).v
Price to public $100 for preferred and $10 for common.:
No underwriting.
For improvement of building," pur-1
L'Aiglon Apparel, Inc., Philadelphia (5/20)
130,000 shares of common stock, par $1.
Of
chase^of new machinery and working capital.
the total 80,000 shares are being purchased by the under-,
writer from the -company and 50,000 shares from two | •
Monroe Gasket & Manufacturing Co., Rochester,
stockholders. Underwriters—Otis & Co. Offering—Price
N. Y. (5/16)-
March 11,
common
working capital of the
service
Industries, Inc., Detroit
May 1 (letter of notification) 100,000 shares common
(par $1).
Price to public $1 per share. Underwriter
—Chapin & Co. For operating capital-expansion pur- <
(par $1). Under¬
writers—Dallas Rupe & Co.; Pittmar & Co.; Dewar, Rob¬
ertson & Pancoast; Fridley & Hess; Creston H.
Funk;
Milton R. Underwood & Co.;
Rauscher, Pierce & Co.,
Inc.; Pitman & Co., Inc.; Gordon Meeks & Co.; Dallas
Union Trust Co.; Moroney, Beissner & Co.,- and
Rotan,
Mosle & Moreland. Offering—Price to public by amend¬
ment.
purchase one additional share
ceeds for corporate purposes.
(6/1)
May Defiled 100,000 shares of
-
share at any time up to March 1,1951,,
Company proposes to sell the securities to personal
friends and acquaintances of officers and directors. Pro¬
■»'
Shoes Inc.,,
Minneapolis-Honeywell
apolis (5/18)
of stock at $4 per
Lattner
Offering—Price to
April 29 filed 23,444 shares of cumulative preferred (par
$100) and 56,267 shares of common stock (par $1). The,
shares are to be sold by five stockholders following a ;*
capital.
Aircraft Corp., New York
stock option warrant to
Minneapolis.
$100r per Unit in January, Februafy and March,f 1940,'
to $103 per units in October, November and December, I
1946.
Proceeds—To pay off first mortgage loans and /
for operating capital.
For details see issue of May 9.
capital.
May 10 (letter of notification) 50,000 shares of capital
stock (par $1), .Price to public, $2 per share. With each
share of stock sold there will be issued and delivered
issue of April 4.
V'V*
Langley
Wholesale,
being sold by four stockholders.
Underwriters—Allen;
& Co.
Offering—Price to public by amendment. Pro¬
ceeds—Construct and equip additional stores; working
than 8,571 and
stock, par $1.
Underwriter—Reynolds & Co. The price to the public
shall be determined by Reynolds & Co. in connection
Proceeds—$97,125 to redeem preferred
and approximately $400,000 to retire short-term
borrowings; balance for working capital.
For
details
.
New York
May 3 (letter of notification) not less
not more than 9,090 shares of capital
lie S6 per share.
-
derwriters.
.
Knott Corp.,
Cooperative
;h(m-cumulatlve^
writers—-By
Corp., Los Angeles (5/22-23)
CuVb Exchange through ;
the New York
May 8 ifiled 10,500 shares of series^ I)
4% preferred stock (par $100).
Underwriters—No un- ,
dividend rates by amendment.
Under-:
amendment.
Probable underwriters will
include Halsey, Stuart & Co. Inc. (bonds only); Harriman Ripley & Co. (bonds only); Merrill Lynch, Pierce,
Fenner & Beane (stock only); First Boston Corp.; Glore,
Forgan & Co. (stock only). Offering—Prices to public
by amendment. Proceeds—To redeem and retire, all of:
the presently outstanding bonds,; notes, aud preferred,
stock.
Bids Invited—Separate bids for the purchase of
the bonds and preferred stock will be received by the.
company at Room 2601, 61 Broadway, New Vork, up to
12 noon (EDST), May 22. Successful bidders must spec¬
ify coupon and dividend rates, respectively.
,
Interest
a
on
by the management. Proceeds will be
used to retire debt and increase working capital.
(5/22)
April 24 filed $34,000,000 first mortgage bonds and
145,000 shares of cumulative preferred stock (par $100).
•
of class Bv
shall not.
Stock will be offered :
brokers selected
Jersey Central Power & Light Co.
March 30 filed 120,000 shares common stock (par $1).
Underwriters—Cohu & Torrey.
Offering—Price to pub-1
•
market
at
Inc., New Orleans;
May 6 (letter of notification) 500 shares common, "par
$1, To be sold for benefit of L. L. Lassalle at prevailing
market price at ordinary broker's commission*
•
filed
l
series A.
Petroleum Corp., New York
$300,000 in amount.
aggregate
Heydeh Chemical Co., New York (5/20)
Ma v
States
issue of May 2.
with
v
Middle
O
May 10 (letter of notification) 75,800 shares
(v.t.c.) stock (no par).
Shares to be sold
$100) the right to exchange 400,000 of such: shares for
preferred and common on the basis of one share
new
(5/23-24)
issue of May 2.
new
of
Brooklyn
April 30 filed 100,000 shares of common stock (par $1);.
also 60,000 additional shares of which 50,000 are re¬
served for issuance upon exercise of warrants, and 10,000
shares for issuance upon exercise of options granted .
to George Markelson and Irving Isaacs.
Underwriters— t
Burr & Co., and Reynolds & Co.
Offering—Price to
public by amendment.
Proceeds—To replace working
capital exended to redeem class A and B first preferred
stock; balance will be used to increase merchandise
inventories, finance instalment sales, etc. For details see ;
April 26 filed 400,000 shares of cumulative preferred
27 filed 215,000
Shares
Haute, IncL,
proceeds to reduce loans payable to banks,:
capital, to finance work in progress. -
Michaels Brothers,
Ittc.^ Pontiac,
Hayes Manufacturing Corp., Gr. Rapids, Mich.
F*e
Distilling Corp., Terr©
balance to working
May 7 (letter of notification) 110,000 shares common
{par $1). Underwriter—UJarr & Co. Price to public $1 :
per share.
For workirig capital.
•
Co., Chicago, III. (5/20)
.
....
Merchants
$1,500,000 of
King Products Co., Inc./ a subsidiary recently acquired,
$500,000 to equip new plants and for working capital.
For details see issue of April 4.
(5/23)
Harrison Wholesale
amount
underwriting.
Ajpril 23 filed 136,254 shares common stock (par $1).;
Underwriters—Not underwritten. Off ering—Shares are March 29 filed 125,000 shares common stock (par $1).
being offered by the corporation'to the holders of its ,
Underwriters-^-Herrick, Waddell & Co.; Inc.,r Offering—
Price to public by amendment,
Proceeds-^-Working ; common stock for subscription prior to 3 p.m. June 4,
capital for expanding operations and to retire present; 1946, at $16 per share, pro rata, at the rate of one share r
Proceeds—
bank borrowing.
Company intends to advance to Air j for each five shares of common held.
•
April 30 filed 85,600 shares of
Foster-Humboldt, Inc., Boulder; Colo.
notification) treasury stock in a total :
of $15,000.
Price to public, 100 per ,share. No ;
Mary
May 9 (letter of
J
(5/20)
Winkle-Munning Co., Matawan, N. J.
April 24 filed 1,250,000 4^% sinking fund debentures
and 105,000 shares 1 of common stock ($3.50 par).
Of
the common stock 39,400 shares are being sold by the
corporation and ,65,000 shares by certain stockholders.
Underwriters—Maxwell, * * Marshall &|Co.
Offering—
Debentures are being offered at 100 and the common
stock at $10.65 per share.
Proceeds-r-Approximately
$600,000 will be used to retire first preferred stock at
$40 per share, $600,000 for payment of bank indebtedness
and $143,500 for the purchase of additional land and
buildings. For .details see issue of May 2.
.
_
common
?Y'Vn/X*
ol $1.50 preferred stock (no
(par 10 cents); un- derwritersh—Granbery,
Marache & Lord and Bear,
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Hydraulic Products Co., Chicago
Stearns & Co.
Offering—Prices to public by amendi
May 9 (letter of notification) 120,000 shares 7% cum- ■' ment. For details see issue of March 28.
ulative preferred (par $1) and 30,000 shares common ($1 "
Marshall Adrain Co., Denver, Col.
par). Price to public of unit consisting of 4 preferred :
and one common, $10. No underwriting. For: acquisi- f
April 29 (letter of notification) 10,000 shares preferred o
lions, working capital, etc, ^:
.
<
stock (par $10).
Price to public $10 per share. Under¬
writer—Robert James Botkin.
To assist in expense of
t
see
Hanson-Van
& Co., Hartford, Conn.
par) and 100,000 shares of common
(par $15).
Gulf Atlantic
(F. H.)
(5/17-20)
McGraw
March 25 filed 36,000 shares
For details see issue of May 2.
vworking capital.
(par
meyer,
Price
held.
shares capital stock
May 9 (letter of notification) 55,000
stockholders
each seven shares of common
amendment.
Purpose—-To augment
at the rate of one share for
72,000 shares of capital I
Johnson & Co.,'
to public at $4
per share.
Proceeds—Purchase and equipping , of build¬
ing, working capital, etc.
Business—Mechanical pack- '
ing and gaskets for industrial use, manufacture of alum¬
inum products, such as radio cabinels, etc.
> -
May 9
(letter of notification)
(par $1).
Underwriter—R. H.
New York.
Offering—To be offered
stock
Liebert & Obert, Philadelphia, Pa. (5/22)
May 3 filed 120,000 shares common stock (par $1). Of to- ■
tal company is selling 40,000 shares and stockholders
80,000 shares. Underwriters—Newburger & Hano and
Kobbe, Gearhart & Co., Inc. Offering—Price to public
Moore Corporation, Joliet, 111.
$6.50 per share.
Proceeds—Net proceeds together with /
May 6 (letter of notification) $250,000 first mortgage
treasury funds will be used to purchase brewery plant
and equipment now operated under lease for $325,000. : 4%%
sinking fund bonds.
Price to public 100% fn.
of
TT«.ia.<.r.Uot<c
Tllinnic Rppiiritips
For details see issue of May 9.
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Volume 163
Number 4490
Mountain States
Co.i(N; Y,;
TeL^& Tel.
April 26
1945.
(S/271,
filed
$35,000,000 40-year debentures and
96,099 shares of common stock ($100 par). Underwriters
--Bonds will be offered at
competitive bidding.
Prob¬
able bidders include
Morgan, Stanley & Co., and Halsey,
Stuart & Co. Inc.
Offering of common stock not un¬
>
r.
•
mon, in the ratio of one share for each five shares then
held.
Proceeds--Proceeds from sale of debentures will
be used to retire
$30,000,000 3V4% debentures called
for redemption June
1, 1946, at 105, and to reduce the
Telephone & Tele¬
Co., parent.
Company intends to use proceeds
from sale of the stock to
pay advances from parent.
Bids Invited-i-Bids for
purchase of the bonds will toe
received up to May 27 (11:30 a.m; EDST) at office of
amount of advances from American
graph
-
,
„
tive
series
by
preferred
\
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Piper Aircraft Corp;,
'
May 3 filed 100,000- shares
income
7rW:
stock (par $1), The
45,000 shares of common issuable
x
-
*
Underwriters—Van Al-
>
styne, Noel & Co. Offering—.Price to public by amendment.
Proceeds—Proceeds will be added to general
corporate funds and used, as conditions permit, for
I
purchase of additional inventory,
issue of May 9.
etc.
other
funds
of
•
.
•
v, \|
Powdrell
&
Alexander,
Inc.,
general
com¬
s
.
(par $1);
;
public by '
Proceeds—Net proceeds will be added to
funds and will be available for general
,
;
For details sec issue of April 4.^
(5/21-24)
May 2 |i)ed 16,428 shares of 4JA% preferred stock" (par
$100) and 246,420 shares of common (par $1)/ The |
shares are issued and are owned by C. G. Thomas, a
former President and Chairman of the Board, who owns ;
of the outstanding
preferred. Under- •
writers—McDonald & Co., Cleveland, O.
Offering—- .
Price to public by amendment,
Business-r-Various steel 7
beneficially
common
common, par
Danielson,
Gnt., Can.
Thomas Steel Co.# Warren, Ohio
$1. Price to public $3 per share. Underwriter—J. F. Reilly & Co., Inc. To purchase a wood flour mill, inven¬
For details see
Mines Ltd.,
'
corporate purposes.
pany/ will, be applied to payiherit of promissory notes
aggregating$8,000,000. Business—Subsidiaries engaged
m
production of bituminous, and in distribution of
bituminous and anthracite coal, etc.
May 9 (letter of notification) 99,900 shares
Steep Rock Iron
«
the
due Jan, J, 1964.
Underwriters—
Offering—Price to public by amend¬
with
,
/ill; ^
amendment.
debentures
Proceeds—Proceeds
O.
March 27 filed 500,000 shares of capital stock
Underwriters—Otis & Co.
Offering—Price to
Co., Hoboken, N.J. (5/28)
approximately
72.8%
and 82% of the outstanding
,
products.
tories, etc.
(5/27)
of common for
May 8 (letter of notification) 2,250 $5 cumulative pre¬
ferred (no par) at $100, and 7,000 shares common (no
par) at $1 per share. No underwriting.
:!;/:■/
Plastic? Materials Corp., Laconia, N. H.
National Bellas Hess, Inc., N. Kansas City, Mo.
^
subscribe to new
share
one
State Finance Co., Youngstown,
•
Pa#
public by amendment.
Proceeds— '
For details see issue of May 2.
Blair & Co., Inc.
common
statement also covers
upon the exercise of warrants.
of
rate
to
The Pittston
ment.
Y.
Lpck Haven,
May 9 filed a $7,000,000 15-year 4% debentures due
April 1, 1961; and $1,242,300 20-year 5Yz% cumulative
company, but s.ock not sold by them is to be offered
Wm. P. Harper & Sons & Co., Seattle, ; as agent;
Namm's Inc., Brooklyn, N.
right to
given
are
at
each two shares of any such stock heid. Price by amend¬
ment
Proceeds—Purchase of additional machinery and
-
Offering—Price
($100 par).
Offering—Price to
Stock is being sold by officers
share.
per
shares
common
21 filed
Working capital.
April 25 (letter of notification). 1,500 shares 5% cumula-'
of
stock
preferred
and after June
May 26 filed 150,000 shares 4y2% convertible preferred
stock (par $10).
Underwriters—Hay den, Stone & Co.
Mutual Loan Co., Portland, Ohio
public $100
on
(5/20-24)
.
:
exercisable
equipment for modernization of present facilities, etc.
For details see issue- of April 4,
v^r>.
$23,500,000 first mortgage bonds, due
1976, and 101,000 shares of cumulative preferred stock,
•
Spiegel, Inc.# Chicago (5/28)
±.0
series C, par $100. Securities will be sold at competitive
bidding, and interest;and dividend rates will. be filed A May 9 filed 117,000 shares of common stock (par $2)7 *
and options to purchase 111,800 shares of common." Unby amendmerit.
Underwriters—By amendment. Proba¬
derwriters—No underwriting.
Offering—Of the shares
ble bidders include Halsey, Stuart & Co., Inc. (bonds
covered, 101,500 are issuable or have been issued under
only)f Smith, Barney & Co. (preferred only); Kuhn,
Loeb & Co., and Lehman Brothers (jointly).
Offering"; options. In addition the company expects to grant op¬
tions to purchase 15,500 shares of common stock to cer¬
—Prices to public by amendment.
For details see issue
tain of Ls employees.
of March 28.
•
Business—Mail order, -; ? ;,f
.
company, 195-Broadway, New York City.
The interest
rate.to;be specified in the bids/For details see issue
of May 2.
are
Pennsylvania Electric Co., Johnstown, Pa.
March
,
recprd^May ;27< j946/of the 480,497 shares-of,com/
The warrants
1, }946, arid on and before May. 31, 1949. at $20 per
For details gee issue of May 2.
share.
derwritten.; : Offering—The 96,099 shares of common
Stock will be offered for subscription at par to holders
of
2695!
THE COMMERCIAL & FINANCIAL CHRONICLE
r
Trailmobile Co., Cincinnati, Ohio
Conn.
„
^.
(5/22-24)
($1 par).
Underwriters—Emanuel, Deetjen & Co.
Offering- % May 13 filed 82,316 shares of common stock (par $2.50).
Company is offering to holders of common stock the new ..Shares are being sold by certain stockholders. Under¬
stock for subscription at rate of one share for each five
writer—Blyth & Co., Inc.
Offering—Price to public
shares of common held.
Price by amendment.
by amendment.
Business—Manufacture of cotton and
Pro¬
May 1 filed 60,000 shares of 4lA% cumulative convert-: ?
ible preferred (par $50).
Underwriter—W. E. Hutton
& Co.
Offering—Price to public by amendment.
Pro- ceeds-r-Redemption of $2.25 cumulative' preferred stock; t
acquisition of additional facilities, reduction of ban^7.
ceeds—Will be
loans, etc.
April 22 filed 397,644 shares
added to
common
stock
working capital.
rayon
For details
issue of April 25, p. 2264,
see
•?
Neiman-Marcus Co., Dallas, Texas
April
29
(5/21)
25,000 shares of cumulative preferred
stock (par $100), Underwriters—Lehman Brothers. Of¬
fering—Price to public by amendment, - Proceeds—
Retirement of $396,800 first mortgage 4% serial bonds
at 103; redemption of the
6,198 shares of 5% cumulative
preferred stock at $105 per share plus dividends; work¬
ing capital,
r■
/ ; -
Radfqrd (J.
(5/23)
.
Wis.;
Paper
.7
Co.;... Port
to
Edwards,
■
public $27 per. share.
Underwriters
—
Schoellkopf, Hut.on & Pomeroy, Inc. <r
New
York
Stocks;
Inc., New York
May 1 filed 1,500,000 shares of special stock.
At market.
Loewi & Co.
v ^
i
-
Offering—
an
Proceeds—For investment.
per
by amendment.
Underwriters—To be filed by
amendment;/Probable bidders include Melldtf Securities
r
Corp.J Halsey, Stuart & Co., Inc. (bonds only); the First
Boston Corp. Offering—Prices to public by amendment.
Proceeds—Redemption and payment of bonds, notes and
preferred stock. For details see issue of April 4. : r
:
i
per
share. :No uhderwritirig.
Developing Co., Salt
,
(N. J.)
Manufacturing Co. (5/27)
March 29 filed 9,886 shares 6% cumulative preferred
(par $100); 31,000 common stock purchase warrants and
81,000 shares of common^ issuable uppn the exercise of
the warrants.
Underwriters—Butcher & Sherrerdi Phil¬
adelphia.
ferred
Offering—1,886 shares of 6 % cumulative
pre¬
offered in exchange (one new share for 10
old shares) for. shares pf 4% preference stock ($10 par),
together with all dividends accrued thereon.
Exchange
are
Salt Dome Oil
United Cigar?Whelan Stores
.
,
-
terms of an exchange to follow authorization of 50,000, •;
shares of convertible preferred stock by the stockhold-*
June 24/for the acquisition of
additional stores, ,
Business—Sale of cigars,
cigarettes, etc., and merchandise, drugs, liquor, etc. • ^ V",
ers on
•
and increase in working capital.
•
United Cigar-Whelan Stores Corp., N. Y. (6/3)]
May 14 filed 50,000 shares of convertible preferred stock. /
Cumulative dividend, $3.50 per annum (par $100). Underwriters—Allen & Co.
Offering—Holders of outstanding prior preferred stock' will, be given, privilege of
exchanging, such shares for shares of new convertible
preferred stock at rate of four shares of prior preferred
for one share of convertible preferred with a cash
Marache & Lord, New York, Of¬
adjustment
All shares
of
;
^
-
convertible preferred not
issued under the exchange offer will be sold to
writers and offered to public at $100 per share.
under¬
Com* «'•*•
proposes' to redeem all unexchanged: prior pre- >
ferred stock/ The issue of new preferred and redemp-; •
pany
Corp., Houston, Texas
r
tion of old preferred is part of a financing program. which includes public offerings of 400,000 shares of com-'
mon stock.
Purpose—To refund old preferred stock/
tificates of interest to stockholders on basis of one share
interest represented thereby for each share of commpn^
■>
For details •<;
at.$15.50 per -share.
Corp.; N. Y... (5/29)]
May 10 filed 400,000 shares of common stock (par 30c),
Underwriters—Allen & Co. Offering—Initial public of- ?
fering price will be determined by a formula. Proceeds —Proceeds will be used to .reimburse ..company in ap-f
proximate amount of $845,000 spent in acquisition of the 7
Dade Pharmacies and Dade Cut-Rate Liquor, Store, for g,
redemption of shares of prior preferred stock which are
not exchanged for convertible preferred stock under the
Highland Perk, N- J-
March *28 filed certificates of interest for 800,000 certificates in overriding royalty in oil, gas and surplus. Under#
f writers—Cohu & Torrey, New York, and Yarnall & Co.,
Philadelphia.; Offering—Company is offering the cer¬
stockholders
issue of Feb. 7.
t
Mr. Kemerer
;
capital stock (no par). UnderNew York,«Offering
see
fering—Company is offering 11,000 shares to stockholders at $11 per share.
Unsubscribed shares and. 9,000 on
- behalf of selling stockholders will be purchased by (he"
underwriters and offered to the public at $11 per share.
ProceedsHMCompany will apply proceeds,^; retirenient
of $250,500 5% income debentures. -
.
g^ay^Luke-Stpker;'./-I//://:/
Paulsboro
Industries Corp.,
derwriter—Granbery,
Lake City
May 9 (letter of. notification) 62,000 Shares commno
(250 par). Price to public, $1 per share.
Underwriter
Ross
g
,
JVIo.-^^-
—Company will offer the 42,000 shares for a period of ?
two weeks after the effective date of registration for f
May 9 (letter of notification) 20,000 shares of common
stock (par $1), of which 11,000 are on behalf of the
company and 9,000 in behalf of two stockholders. Un¬
May 10 (letter of notification) 7,000 shares commori (par
American Mining &
Feb. 4 filed 42,000 shares
option dated Feb. 20, 1946, to Morgan U.
share, payable in Canadian exchange.
,a
Union Wire Rope Corp., Kansas City,
writersr-^P. Wi Brooks & Co^ Inc.,
purchase 300,000 of the 500,000 shares optioned to Mr.
Kemerer at 30 cents per share.
Mr. Daniels plans to
market the shares optioned to him through the medium
of a registered broker or brokers in the United States.
Offering—Price' to public is: 40 cents per share, IT. S.
funds.
Proceeds—Proceeds will be applied to develop¬
ment work, etc. For details see issue of April 4.
•
Oscar Mayer & Co., Inc., Chicago
Price to public, $38
exclusive
Light and Traction Co.
public will be filed by amendment.
.
has assigned to Mark Daniels, 371
Bay Street, Toronto,
In consideration of $1, the former's right and option to
stock
Pan
to
Kemerer of Toronto to purchase 500,000 treasury shares
at 30 cents per share and 500,000 treasury shares at 40 cents
30 filed $32,000,000 first mortgage
bonds, due
1976; $5,500,000 serial notes and 156,300 shares of cum¬
ulative preferred stock (par $100). Interest rate on the
bonds and" notes and dividend rate ton the preferred
•
Grocery Co., Abilene, Texas
March 27 filed 300,000 shares of common stock ($1 par).
Underwriters—Not underwritten. Company has granted
(5/20)
7
g
Underwriters—By amendment.
Probable bidders in¬
clude Harriman Ripley & Co.; The First Boston Corp..
and Blyth & Co., Inc. (jointly).
Offering—Federal will g
offer the stock for sale at competitive bidding and price jv
Rockridge Gold Mines Ltd., Toronto, Can.
OhiO Public Sendee Co., CI eve la nd, O.
$10).
M.)
Tucson and is owned by Federal
sale to
?
March
•
March 29 filed 147,000 shares common stock (no par).
Stock constitutes all of the outstanding common stock o!
April 29 filed 15,000 shares cumulative preferred stock
(par $50).
U'nderwriters-rHauscher, Pierce & Co., Inc,
Offering—Price to public by amendment. Proceeds—To
finance in part acquisition of the stock of the predecessor
company.: Business—Wholesale grocery company.
May 3 (letter of notification) 3,144 shares common stock
(par $25) being offered by John E. Alexander.
Price
and
Tucson (Ariz.) Gas, Electric Light & Power Co«
Public Flyers, Inc., New York 1(5/20-24)
April 4 filed 200,000 shares of common stock (par $1).
Underwriters—Bond & Goodwin, Inc.
Offering—Price
to public $3 per share.
Proceeds—Payment of notes,
purchase of flight equipment, additional hangar facili¬
ties, improvement of airport property and other related
uses. For details see issue of April 11.
filed
Nekcosa-Edwards
fabrics/etc.
United Grocers Co.,
Brooklyn
(6/1)
April 25 (letter of notification) $300,000 5% debentures
offer is conditioned on purchase of
dated June 1, 1946; due June 1, 1956.
remaining 8,000
Offering—To be /
shares of 6% cumulative preferred and of the 31,000
offered by company to stockholders and customers; also
Common stock purchase warrants by underwriter. Pro¬
Schwarz Engineering Co., San Francisco
exchanged for $75,000 6% bonds to be redeemed July
ceeds^—-Purchase? ori construction, of "a plant :and nec¬
ApriL17 (letter of notification) 150,400 shares of capital t 1, 1946. Price, par.
Proceeds—Proceeds will be used
essary machinery and equipment.
For details see issue ; stock (par $1), to be offered present stockholders at par. f as follows: payment of bonds, $75,000; construction of
of April 4.
,
,
A total of 110,000 rights to buy same class of stock being ^ new building, $150,000; mechanizing warehouse equip¬
% / -W:77/;7§i
sold by certain stockholders.
Price per share of new ; ment, $25,000; working capital, $50,000.
Pennsylvania-Dixie Cement Corp., N. Y.
stock arising from four rights is $1. Underwriters of
stock held at 58 cents per share,
proceeds—Exploring
and developing. For details see issue of April 4.
,
April 25 filed 80,000 shares capital stock (par $7).
Un¬
rights: J. Barth & Co., and Shuman, Agnew & Co., Inc. *
derwriters—None named.
Offering—The 80,000 shares
are reserved
for issue upon the exercise of warrants
which were issued to holders of common stock of Gen¬
eral Cement Corp. in connection with a merger of that
corporation into Pennsylvania-Dixie effective Dec. 21,
Segal Lock & Hardware Co., Inc.f N. Y.
March 30 filed 738,950 shares of common (par $1), Un-;.
derwriters—Floyd D. Cerf & Co. Offering—Holders of
,
common
stock, 7% preferred stock and $2.50 cumulative;
•
United
Investors Corp.,
Denton, Texas
(6/3)1'
May 14 filed $1,000,000 investment trust fund certificates,
in units of $10 and up, in multiples of $10.
Offering-At. market.
Proceeds—For investment.
Business—A
management investment company.
(Continued on page 2696)
r
■
-
jalS
.
!'•: v
fering—Price to public 30 cents per share, United Statea
Underwriters—Willis E.: Burnside & Co.,
Offering:—Offering price to public 28 cents ^ funds. For details see issue of Feb. 21.: v.'/
Y jt
United States funds.
For details see issue of Aug. 2,1945.
(Pa.) County Gas Co. (5/27) Y.y •
Ay\*» .
J •'U ;•<*. i . J -ip*' A\
iy't ' '♦*/''
*
*, * #. ",V.Y i$-'l .York
May 8 iiled $1,700,000 first mortgage bonds, due 1976.
Western Kentucky Gas Co., Owensboro
Will be sold at competitive bidding.
Interest rate by
May 6 (letter of notification) 11,320 shares 4,80% cumu¬
amendment.
Offerings-Price by amendment.:? Proceed^
-New York.
Airlines, Inc., St, Petersburg, Fla^ (6/1)
U. 5-
»•
April 22 filed 900,0U0 snares common stock (par $1)
and 300,000 stock purchase warrants, of which 150,000
have been issued to Harry R. Playford, President, and
150,000 will be issued to underwriters. Underwriters—
K. H. Johnson & Co.
Ottering:—Price to public $3.25
per share.
Proceeds—To pay principal and interest on
hank loan, to finance purchase of additional aircraft,
equipment, etc., and for working capital.
f
lative preferred.
Price to public $26.50.
Underwriter—
£ 4 V* 'Y-':
'>
•
$$ r!,u
\
^
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Wiggins (E. W.) Airways, Inc., Norwood, Mass.
$50),
(letter of notification) 200,000 shares common
stock.
Price to public 62 ^ per share.
UnderwriterStandard Securities Corp., Spokane, Wash.
^
"
Price to public, $50 per share.
*f.
M
y ^
•
r
j
'
'
Yank Yellowknife Gold
Feb. 13 filed
Virginia Red Lake Mines, Ltd.
filed 220,000 shares of capital stock (par $1—
June 24
No underwriting.
.
-
,
4
I
,
0
Mines, Ltd., Tor., Ont.
1,000,000 shares of
common,
stock (par $1),
Underwriters—J. J. Carrick, Ltd., Toronto, Canada.
4<
Young Radiator Co., Racine, Wis.
Jan. 29 filed 100,000 shares of common stock (par $1);
also registered 40,000 shares of common for issuance upon
exercise of warrants.
Underwriters—Van Alstyne, Noel
& Co.
Offering—Price to public $8.25 per share.
Of
40,000 warrants to purchase common stock at $8.25 per
share prior to Feb. 1, 1951, 20,000 were issue to stock¬
holders on recapitalization and 20,000 are being sold to
underwriters at 10 cents per warrant share.
Offering
postponed indefinitely.
For .details see issue of Feb. 7.
May 10 (letter of notification) 6,000 shares common (par
Valley View Mines, Inc., Spokane, Wash.
For details see issue of May 9.
—Refunding.
J. J. B. Hilliard & Son.
April 17
Y'Y'Y /
194)8
Canadian).
J)' (Continued from;page 2695) Y
'/
1 Thursday, May 16,
THE COMMERCIAL & FINANCIAL CHRONICLE
2696
Of¬
Security Offerings
Prospective
(NOT YET IN REGISTRATION)
•
Air
Services, Inc., New York
April 1
Bangor & Aroostook RR.y
was
American Bemberg Corp., New York
June 25 stockholders will vote on proposal that present»
T% preferred stock be exchanged for new 4% % issue.
Alternative plan would be the refunding of the issue
American Bosch Corp.
the
Bridgeport (Conn.) Brass' Co.
Probable bidders" include
Glore, Forgan & Co. and Lehman Brothers (jointly);
and Blyth & Co., IncV and Merrill Lynch,
Pierce, Fenner
& Beane (jointly).
Broadcasting Co.,
of
shares
common
Probable
needed.
stock when
and
(The)
New York
additional 450,000
if
new
is
capital
underwriters, Hincks Bro. & Co.;
Hornblower & Weeks.
Co., and Budd
on merging, the surviving com¬
to be The Budd Co. Additional capital would be
provided through sale of 537,000 shares of common stock
to be initially offered to stockholders on a one for five
basis. New company would also sell $30,000,000 of de¬
bentures to 5 retire 'existing indebtedness,
Probable
underwriters are Blyth & Co., Inc., and Carl M. Loeb;
shares of
Third amended
stock.
common
White, Weld & Co., W. C. Langley & Co., Otis & Co.
Arkansas Power & Light Co.y Little Rock, Ark.
March
30
Central
Probable bidders include
notes
sory
and
finance
expansion
program.
.
Inc.; The First Bos¬
Artloom Corp., Philadelphia
July 16 f stockholders will vote on increasing comipon
stock by 300,000 shares, the new stock to be ^offered
working capital.
Issuance by the road
Proceeds for expansion
Brothers.
excess
$50,000,000 in aggregate. The
said, is to place the company
loans, add to working capital
and td provide funds for capital expenditures. Probable
underwriters include Smith, Barney & Co.
2 for
1
stockholders
voted
to" split
\
tion
common
•
BUFFALO
"
CHICAGO
PITTSBURGH
:
•
'
f'V
<• '•••
New York
stated that in final step in recapitaliza¬
corporation is expected to sell approxi-
Graef &
P. U. Commission appli¬
cation to sell at competitive bidding 876,568 common
shares, after capital adjustment. Proceeds for extensions.
Probable bidders include Morgan Stanley & Co.; Lehwith Michigan
Brothers; Harriman, Ripley & Co., and Mellon
curites Corp. (jointly).
*
•
Detroit Edison Co., Detroit,
March 19 committee of directors
CLEVELAND
ST. LOIHS
175,000 additional preferred shares*
include Paine, Webber, Jackson &
*
Schmidt, Inc., New York
Custodian invites bids for the pur¬
chase, as a whole, of 100 shares of common stock (no
par) constituting all the issued and outstanding com¬
mon stock.
Company presently is engaged in the manu¬
facture and sale of a line of scissors and shears. All bids
presented at the Office of Alien Property Cus¬
todian, 120 Broadwayj New Yofk 5, N, Y.; on or beforq
niust he
12
(EDST), June 7, 1946.
noon
•
Inc., Rockford, III.
Green's Ready Built Home,
pany,
!
Se»
v
Mich.
formed to consider
refinancing of $65,000,000 3y2s and 4s. Probable bidders
Include: Mellon Securities
Corp., First Boston Corp.,
Dillon, Read & Co. Inc., Coffin & Burr, Halsey, Stuart
& Co., Inc., and Spencer Trask & Co.
-
it is stated; will also sell 150,000 warrants to un¬
derwriters at 100 per warrant. Price of stock to public
is expected to be $3.50 per share.
Underwriters, it is
understood, will be R« H. Johnson & Co., New York,
Chicago.
and Shillinglaw, Bolger & Cp.,
•
Gulf
Utilities Co.,
States
Beaumont, Texas
May 13 company, subsidiary of Engineers Public Service
Co; proposed a $27,300,000 refunding program to SEC
to effect interest savings. Company proposes to sell at
competitive bidding $27,000,000 new bonds with interest
rate to be fixed b,y successful bidder and to borrow
$2,000,000 on its 194%, promissory note from Irving
Trust Co. Proceeds would be used to redeem. $27,300,000
and refunding bonds, series D, 3 ¥2%,
Probable bidders include Stone 8s
Webster Securities Corp.; The First Boston Corp.; Halsey,
Stuart & Co. Inc., Blyth & Co., Harriman, Ripley & Co,
first
due
!».,
,
mortgage
1,- 1969.
May
l
1
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Yij,
Huyler's, New York City
May 5 reported that stockholders'
vened shortly for purpose
from
mon
141,530)
meeting will be con¬
of increasing authorized com¬
600,000 to 700,000 shares; to
sale of the 100,000
tal
Jackson, Mich.
man
bidders
The Alien Property
f
management's request; to
mortgage system's properties said to be forerunner to
refund $304,240,000 callable debentures. Contemplated
new
bonds, to be sold at competitive bidding, would
initially, it is said, involve $100,000,000. Morgan Stanley
& Co. probable underwriters.
;:uv- -a ///tY
-'NEW YORK
PHILADELPHIA
* ;'
$100,000,000 debentures to pay off balance of
securities and provide funds/for property ex¬
March 14 filed
;
BOSTON
•
was
Consumers Power Co.,
and
6- Co,
-
Corp., New York
Curtis.
March 18 stockholders granted
Corporate Securities
INC.
•
Consolidated Edison Co. of New York, Inc.
improve¬
Government,
Blair
r ' •'
'
program,
authorize
to
ment
pansion.
Probable bidders include: Glore, Forgan &
Co.; W. E. Hutton & Co., and Halsey, Stuart & Co., Inc.
stock
/
v-:. -:YYY.;Y:Y
"
mately
ments, etc, Blyjh & Co., Inc.; probable underwriters.
Y--v
•
senior
create new preferred isue of 300,000
(par
$10) of which 150.000 shares would be issued and sold
State, Municipal
-
April 12 it
arid
United States
to be delayed until all litigation on
Columbia Gas & Electric Corp.,
Oakdaie, Calif.
to finance purchase of constituent
company,
1994,
banking groups were set up to enter competition for
ottering, viz.: Kuhn, Loeb & Co.; Mellon Se¬
curities Corp., and Halsey, Stuart & Co., Inc.
:
purpose of the plan, it was
in a position to fund bank
19
would
any new
of
Atlas Imperial Diesel Engine Co.,
General Telephone
April 17 stockholders approved amendment to certifi*
cate of incorporation modifying restrictions against in**;:
curring debt for capital purposes without specific stock¬
holders' approval. Y Stockholders also ' approved amend-^
the reorganization is completed.
Earlier plans were for
the retirement of the bonds July 1.
Three. Investment
Philadelphia
May 7 stockholders approved proposal to increase the
company's indebtedness from time to time by additional
April
is expected
now
amounts not in
accrued from May 1 to exchange date, for
preferred share. Exchange otter will be under*
written by Blyth & Co., Inc.
.1
May 15 it was reported that early registration of 350,000
shares of common stock (par $1) was expected*; Com¬
of,$58,900,000 lower-coupon first
mortgage bonds, proceeds from the sale of which
be used to redeem first mortgage 4% bonds,
Probable underwriters, Lehman
Atlantic Refining Co.,
Possible bidders; Glore,
Chicago Milwaukee St. Paul & Pacific RR.
-
and
•
Forgan & Co.; Lehman Brothers-Lazatd Freres & Co.
(Joint); Smith Barney & Co.-Harriman, Ripley & Co.
(Joint); Blyth & Co., Inc., Stone & Webster Securities
Corp. and First Boston Corp. (Joint).
ton Corp., and BIytb & Co., Inc.
stockholders at $10 per share.
Public Service
& South West
Sufficient number of shares ^ of new company
would be sold at competitive bidding to provide funds,
not otherwise supplied, to retire outstanding preferred
stocks of Central and American,
Probable
provides for •• refunding the
tary exchange offer of one share of 4% preferred, one
second "preferred and $12.50 in cash, plus;
plan filed with SEC in March provides
Corp.
;
company
bidders include Dillon, Read & Co.
Co., Wilmington
that company be merged with American
Y Co. into corporation known as Central
planned to issue 290,000
shares common stock (par $12.50) and $5,000,000; in
promissory botes, fpr purpose of paying current promisr
reported
Plan
share of 4%
Probable
& Southwest Utilities
share.
outstanding $15,000,000* 7% preferred with dividend
arrears of $52.50 per share by making holders a volun- i
pany
Rhodes & Co.
new
which will provide a new issue of $15,000,000 4% first
preferred stock (par $100) and $7,500,000 4% cumulative
second preferred stock (par $50) and the
reclassifying of the class A stock with arrears of $4 per
share into common stock at rate of 4 common shares for
convertible
each 7%
Manufacturing will vote
American. Gas & Power Co.
" J
dividends
Budd Co., Philadelphia
June 11 stockholders of Edward G, Budd
April 10 company' (name to be • changed to Minneapolis
Gas Co.), under modined plan approved by SEC, reserves
right to make public ottering of not in excess of 874,078
.
General Cable Corp., New York
-
June 10 stockholders will vote on recapitalization plait
each class A
an
Stone & Webster Securities Corp.;
April 25, E. J. Noble, Chairman, announced company
Is planning to offer a substantial amount of authorized
but unissued common stock to the public and to owners
of radio stations affiliated with the network, through
an underwriting group headed by Dillon, Read & Co.
Inc. Of fer is dependent on approval of FCC.
Y
company
April 23 stockholders voted to issue
corporation.
American
•
stated early registration of 59,862 shares
of cumulative convertible preferred stock (par $100)
expected.
The new issue, to be voted on by stock¬
holders June 1, will be offered in exchange for $4.25
preferred. Glore, Forgan & Co. will be underwriters.
April 16 reported that Alien Property Custodian may
shortly ask for bids on 535,000 shares (77.24 %) of the
of
Empire District Electric Co., Joplin, Mo.
May 3 company filed application with the Arkansas P. S.
Commission for authority to issue $2,000,000 2%% first
mortgage bonds due in 1976. Proceeds would be used fori
additions and improvements to the company's properties
•in Missouri, Arkansas, Kansas and Oklahoma. Probable
bidders include The First Boston Corp.; Halsey, Stuart
& Co. Inc.; Shields & Co. and Lehman Brothers.
Y |
Beatrice Creamery Co.y Chicago
May 1
through sale of other securities.
stock
Bangor, Me.
April 16 stockholders authorized new mortgage. Com¬
pany contemplates refinancing one-third of outstanding
funded debt (Dec. 31, 1945, $12,665,000) through sale of
equal amount of bonds under new mortgage, through
competitive bidding.
Probable bidders include Harriman, Ripley & Co., Inc.; Lee Higginson Corp., and
Halsey, Stuart & Co. Inc.
y
reported planning sale of 150,000
chares of common stock through B. G. Cantor & Co.,
New York, as underwriter.
Price about $2 per share.
Company's headquarters will be located within eight
miles of New York City.
Principal business will be
student training and charter service.
company
INDICATES ADDITIONS SINCE PREVIOUS ISSUE
at not less than $10 per,
would be used to redeem loan/
working capital.
authorize the
shares plus 41,530 now unissued (to¬
Proceeds
share.
preferred stock and for
,
^
Illinois Central RR.
May 3 it was announced that
posed
bond refunding plan
in connection with pro¬
company proposes
to sell
mortgage bonds Series B.
retire outstanding refunding
$35,000,000 first and refunding
Proceeds would be used to
mortgage bonds to be called for
payment Nov. 1 at 107 Ms,
Co. and Halsey, Stuarl;
Probable bidders: Kuhn, Loeb &
D-
Taa
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B/olume 163
V
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•
VV*'--.'*. t;V
.
.
Number 4490
r t
!
bonds
!S; Illinois:-Power Co., % Decatur, III.
Iv
April 11 /company filed plan with SEC to simplify capi¬
tal structure.
and Mellon Securities
Plan contemplates the conversion of 5%
cumulative preferred stock (par $50) into common stock
basis of two common shares for one preferred.- Com¬
ferred not tendered for conversion," Company proposes
issuance of 200,000 shares of new preferred (par $50)
fend such additional common shares to- provide cash to
pay dividend arrears certificates ($11,596,680).
Prob¬
,
able bidders; include Merrill Lynchj Pierce,
r
Fenner &
;
Jteane; Otis & Co., and the First Boston Corp.
Indianapolis
April 24 it
Power & Light Co.
(Ind.)
f
.
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,
-
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l '\'!)
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ments.
Probable
;
$11 Pere
&
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r
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National
May 15 it
v,;/.
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v
Lowenstein
May
.
t
(M.)
per
& Sons,
if
"
New York Dock Co., N. Y.
April 17 reported that company has under consideration
the refunding of its $45,000,000 series C 3yss with issue
of about same size carrying lower coupon rate.: Probable
bidders, Halsey, Stuart & Co. Inc., and Harriman, Ripley
Co.
Northern Pacific Ry., St. Paul, Minn.
It
>
was
reported April 10 that company has under
con¬
sideration the refunding of $55,000,000 collateral trust
41/2 % bonds due 1975 and the issuance of a new series,
of collateral trust bonds.
Prospective bidders, Morgan
Stanley & Co., Halsey, Stuart & Co. Inc., and Kidder,
Peabody & 'Co.
pro-
Ohio Edison Co.,
Mich.
.April 1 filed with SEC application to sell (a) $3,500,000
tfirst mortgage bonds due April 1, 1976, (b) 14,000 pre¬
ferred shares (par $100) and (c) $400,000 common stock
(par $10). All issues would be sold through competitive
Tbidding.
Probable bidders include Blyth & Co., Inc.;
Kidder, Peabody & Co.; The First Boston Corp.; Harris,
Ball & Co.. (Inc.); Merrill Lynch, Pierce, Fenner &
Beane, and Ira Haupt & Co.
.
Michigan-Wisconsin Pipe Line Co. ■'
May 3 it was reported that Michigan Consolidated Gas
Co., through the purchase of $17,000,000 in common
stock, would acquire full control of the Michigan-Wis¬
consin Pipe Line Co.1 Sale of the stock to Michigan
Consolidated would be a part of the initial financing
of the new company, which proposes to build a $71,C00O00 pipe line to bring natural gas from Texas to
Midwest
States,
Michigan-Wisconsin's proposal also
contemplates issuance of $6,000,000 in 2% 5-year serial
notes and of $34,000,000 in 3V4% 20-year first mortgage
bonds to complete the "initial financing." The plan has
jet to be presented to the
SEC. Probable bidders of the
>.
*
rj■>. J:
(Mo.)
Public Service Co.
petitioned the Missouri Public
Service Commission to simplify its financial
structure,
company
including reduction in interest
:
and
Company
640,683)
sinking fund changes.
proposes to retire current funded debt
and to issue up to $10,000,000 new
($lM
bonds, but
Corp.
Seaboard Corp., Kdrrfehurg, Pa.
April 30 John Stapf, President, announced that proposals
aiid plans for the refinancing of
corporation ahd affiliated
interests will be received
,qntil June 1; 1946, by the com¬
pany. Operations consist mainly: of. owning and
managing
22 water utilities located in seVeral
states.
Interested
firms are invited to communicate with the
general
N. Sixth
office,
St., Harrisburg, Pa.
Seaboard Fruit Co.,
„
Inc., New York
'
It is understood that
company will file a letter of ho-*
tification in the near future covering an issue of; con-*
vertible Class A stock and common stock to be offered
in units of one share of each, the Aggregate td be in the
stock. Proceeds for expansion, etc.
Hearing on
application before SEC will be held June 5. Probable
bidders include First Boston Corp.;
Glore, Forgan & Co.;
White, Weld & Co>Shields & Co. (jointly); Morgan Stan¬
ley & Co., and Stone & Webster Securities Corp.
Oklahoma Gas & Electric Co., Oklahoma
City
Company contemplates at same time Standard Gas &
Electric Co. sells its holding of common stock
(in
ac¬
cordance with SEC regulations) to sell approximately
140,000 shares of new common stock, proceeds of which
will be used to reimburse treasury and retire bank loan
Used:in redeeming the 7% preferred stock,. Probable
bidders will include Merrill Lynch, Pierce, Fenner &
Beane; The First Boston Corp., and White, Weld & Co.
Pennsylvania Edison Co., Altoona, Pa.
March 28 company applied to the SEC for permission to
issue (a) $23,500,000 first mortgage bonds series of 1976,
and (b) 101,000 shares of series C cumulative
preferred
stock, with a dividend rate not to exceed 4%.
Both
issues
are
to be sold
through competitive bidding. Prob¬
Mellon Securities Corp., Smith,
Barney & Co., Kidder, Peabody & Co., and Merrill Lynch,
Pierce, Fenner & Beane.
j >
able
bidders
include
neighborhood of, $295,000. It is expected that Hill;
Thompson & Co., will be underwriters.; Company, which
is In business for about mine years, is engaged; in the
exporting of fruit, meats, vegetables, etc., to Latin Amer¬
ican countries.
Socoiiy Vacuum Oil Co., Inc.
Toledo, Ohio
March 21 filed with Ohio P. U- Commission
application
to sell" through competitive
brnding 204,153 shares of
common
Michigan Gas & Electric Co., Three Rivers,
^
,
authorizing refunding of
iposed financing would also provide for $7,000,000 new
•capital fot expansion purposes. Probable underwriters
include Drexel & Co., and Lehman Brothers.
St. Louis
April 19 the
Boston
April 24 reported negotiations will be resumed within
month for refunding of $10,000,000 first mortgage
4s,
due 1951. New issue will probably run 25 years. Prob¬
able underwriters, Efaydep, Stone &
Co., and Halsey,
Stuart &. Co., Inc.
'
;v'".#
Mead Corp., Chillicothe, Ohio
[•' preferred stock carrying lower dividend rate. The
^
originally to $6,000,000.
Probable bidders in-'
elude White, Weld & Co.; Blyth & Co.,
Inc., and First
Northern Indiana Public Service Co.
^5.50 cumulative preferred stock. The refinancing would
jbe accomplished through the sale of new bonds: and
\
l.!-■>.,} 5
limited
of N. S.
$8,000,000 privately-held first mortgage 3Vs% bonds due
I960 and refinancing the outstanding 30,755 (no par) $6
•cumulative preferred stock Series A and 49,079 (no par)
1f
Reynolds International Pen Co., Chicago
An early offering of 200,000 shares of common stocks
at
about $10 per share is expected, with Allen
&; Co.
principal underwriters.
v>
■
Kidder, Peabody & Co. (Joint).
&
x
total market value
•
Association, Cam¬
Proceeds will be used to retire at par and interest out¬
Inc., New York
of Atlas
1,329,020 shares (43%) Dec. 31, 1945, with
as of that date of
$21,762,702. Sale
may be made by June 30 6r some time in the fall.
,prob- 1
able underwriters if stock is
sold, Dillon, Read & Co* '
Inc.
; "
a
Co.; Blyth & Co., Inc.; Hemp¬
standing debentures. Bidders may include Halsey, Stuart
& Co., Inc. (for bonds only), Bear, Stearns & Co. (for
stock only), First Boston Corp.; White, Weld & Co.*
share.
'
'•••
amounted to
original issue of 2,300,000 shares'to supply $11,500,000;
v
■
Corp., stated that^ company may shortly dispose of all or
part of its holding of R-K-O common stock; whicht
Gypsum Co.
include W. E. Hutton &
'
Radio-Keith-Orpheurn Corp., New York
May 4 L. Boyd Hatch, Executive Vice-President
was
bridge, Mass.
14
•Tune 9 stockholders will vote on
I
takes place.
March 27 filed amended recapitalization plaa with SEC'
providing for sale at competitive bidding of (a) $22,500,000 20-year sinking fund collateral trust bonds, plus
(b) sufficient shares of new common stock out of the
it was reported that due to expansion and
•acquisition of grey mills company; has need of additional
capital. If additional stock is required, Eastman, Dillon
.fSs Co. are expected to head the underwriting syndicate.
'
from
■y
.clocks, is reported planning the sale of 90,000 shares of
Price $3
underwriters
.
on
increasing capital
2,000,000 shares of common to a total of
3,370,057 shares, consisting of 250,000 preferred shares
(par $100), 2,500,000 common shares (par $3) and
620,057
class B stock (par $3),
Purpose is to secure permanent«icapital as may be required for future expansion.
Smith,
Barney & Co. probable underwriter if sale of securities ^
stock
Glore, Forgan & Co., and Shields
New England Gas & Electric
Kurman Electronic Corp.
JJCurman, President.
Co., and White, Weld & Co. (jointly); Morgan Stanley
Philco Corp., Philadelphia
17 stockholders will vote
hill, Noyes & Co.
Company, manufacturer of various electrical relays and
Common stock through B. G. Cafttor ^ Co,
'tional 7,500 shares would' be' sold for account'
Probable
;
Electric
May
reported that early registration of 275,000
shares of common stock is expected. Probable underwrit¬
ers
company
itfijfyjfatiy-V>fyr':•'•$?>'? JV<•
of business.
/
,^v
with
& Co.
& Co.
applied to the SEC for permission to
$13,750,000 of new first mort¬
gage bonds, and 42,500 shares of cumulative preferred
Stock.
The company would also issue $1,750,000 bank
Jiiotes and give present common stockholders the right
to purchase 137,333 shares of additional common stock
(par $15) on the basis of one share for each three shares
iheld, at a price to be determined later. The company
.plans to refinance bonds, debentures and first and second
preferreds outstanding in an aggregate amount of $20,:283,946. The securities to be retired include first mort¬
gage bonds, 3%%, $13,753,000; 5% debentures, $1,442,000;
first preferred, $3,841,146, and second preferred, $1,-*
•247,000.
Probable bidders for the new securities in•clude Halsey, Stuart & Co. Inc. (bonds); First Boston
♦Corp.; W. C, Langley & Co. (stock); A. C. Allyn & Co.,
Viand Blyth & Co.
-f
volume
stock is offered include
sell at competitive bidding
.
Philadelphia
&
Co. Inc.
panded
on
Iowa Public Service Co.
May 14
of
Electric Power Co.
filed
Co., parent, and sell
120,000 common shares to Philadelphia Electric Co.
Probable bidders will include
Halsey, Stuart & Co.,
Inc.; Drexel & Co.; Kidder, Peabody & Co.; Shields
meeting, indicated that rights may shortly be
offered to shareholders to raise funds to finance an ex¬
share for each five common shares held.
i
company
notes
Montgomery Ward & Co., Chicago
Avery, Chairman, following the annual stock¬
flVhite, Weld & Co. will be underwriters.
e*
19
SEC a plan to simplify
capital structure which embraces among others the
pro¬
posed sale through competitive bidding of
$30,000,000
first mortgage bonds due
1975; $12,000,000 of serial noies
to be sold to banks, insurance
companies and institutions;
issue of 242,000 common shares in
exchange for demand
Sewell L.
approving sale of 145,4B34 unissued common shares.
It is proposed to give
Stockholders rights to purchase additional shares on
y*
(Pa.)
April
Light Co., Jefferson City, Mo.
■
May 20 stockholders will vote
r
,
•
Peabody & Co.
Chicago, III.
*
,
•
bidders
(bonds only); The First Boston Corp.;
Blyth & Co., Inc.; Coffin & Burr,»Inc.; and Bidder,
International Minerals & Chemicals Corp.;
one new
Marquette Ry.
•
April 24, W. H. Wenneman stated that
refinancing, of V
company's $59,749,000 first mortgage 3%s will be un¬
dertaken following consumma.ion of
merger offload
with Chesapeake & Ohio
Ry.
Probable underwritersinclude Halsey, Stuart & Co., Inc., and Blyth &
Co., iInc. '
include Otis & Co.,
Glore,
Forgan & Co. and Lehman Brothers (jointly);
Halsey,
Stuart & Co. Inc., and Dillon, Read & Co. Inc.
art
company
basis of
Gas Co.
Va.# for $600,000, plus closing adjustments,
holders'
-
common stock of the
Petersburg & Hope¬
(a subsidiary) consisting of 55,000 shares *
(par $10) to Scott, Horner & Mason, Inc., of Lynchburg, \
well
($100 par) preferred stock; reclassify and convert its
75,000 shares of existing common stock (no par) into
•165,000 shares of new common ($20 par) and retire all
and refund part of its outstanding debt by
redeeming
its $9,000,000 aggregate principal amount of first
mort¬
gage bonds, 33A% series due 1966, and issuing and
selling
$7,500,000 new first-mortgage bonds, due 1976 at. com¬
petitive bidding. Probable bidders include Halsey, Stu¬
announced that 101,700 shares of capital
Stock (par $1) would be offered-for subscription to
stockholders of record May 27 at $5 per share. Bights
.expire June 17 3:00 p.m. Offering is contingent on regis¬
tration statement (yet to be filed) becoming effective.
j
Pennsylvania Gas & Electric Corp., York, Pa.
May 7 corporation applied to the SEC for permission to
sell all of the
.•
,
; proposed refinancing program. Missouri proposes to re¬
deem and retire all of its
50,000 shares of $6 preferred
stock and to issue and sell for cash
40,000 shares of new
'<
Insuranshares Certificates, Inc.
May 2
-*
/'
May 3 company, a subsidiary of North American Light
& Power Co., requested the SEC for
authority for a
Indianapolis (Ind.) Water Co.
May 6 company filed a petition with the Indiana State
P. S. Commission asking permission to sell $14,725,000
Ibonds bearing 2 3/4% interest and due in 1976 at not less
than TOW. Proceeds will be used to redeem $14,425,<000 of 3Va% bonds callable at 104 and due in 1966. Prob¬
able underwriters include Morgan Stanley & Co., and
Jlarriman, Eipley & Co.
iD
j
Light Co^
Missouri Power &
1
i
'
>
6 it was reported* company is considering refund¬
ing its $3,000,000 4V2% bonds due 1967 and the refunding
or
retiring of the $2,000,000 outstanding 7% preferred
stock. Refunding step would strengthen
company's capital structure as a forerunner to distribution of its stock
by the American Light & Traction Co., parent, to enable
latter to meet Utility Holding
Company Act require-
was
v
-
' "
Philadelphia
reported that company probably will
replace its $32,000,000 first 3V4S due May 1, 1970, with
pew lower-cost securities.
Probable underwriters in¬
clude Lehman Brothers; Blyth & Co., Inc., and Halsey,
Stuart,& Co. Inc.,
.
"-.,.
Corp., "
% May
-
to redeem any pre-
common
-'7
>
' A Milwaukee Ga$
;
pany states underwriting is. available for; this conyer--:
cion program and will cover a 30-day -commitment to
purchase enough additional
include Dillon, Read & Co.
Inc.;; Glore, Forgan
Co.;'White, Weld & Co.; Halsey, Stuart & Co.Vlnc-ift
•i&
on
•
699
THE COMMERCIAL & FINANCIAL CHRONICLE
May 7 reported - company contemplating refunding it®
$50,000,009 outstanding 3 %, sinking fund debentures due
July 1, 1964, and possibly a part of the $50,000,000 serial
notes now held by banks. It is believed hew issue would
carry a coupon rate of 2 %-2 x/2%
25 years.
and would mature in
Probable underwriter, Morgan Stanley & Co^
Southern Co., New York
The Southern
&
Southern
Co. „(to
be
'
successor
to
Commonwealth
Corp.)
proposes to sell for cash (when
recapitalization plan becomes effee-.
tive) sufficient common gtock to realize $10,000,000, to
Commonwealth's
be
invested
in
.
Southern: Co.'s
^construction.
subsidiaries
andnew
;
^ Southern Electric System, Inc.
I
May 10 pursuant to substitute plan for retirement of
preferred stocks of Electric Power & Light Corp., filed
•
with
SEC
common
stockholders
of
Electric
Power
&
Light Corp., would be given rights to subscribe to United
Gas Corp. common stock and stock of the new
holding
company Southern Electric System, Inc. The latter com¬
pany would be formed to hold the stocks of Arkansas
Power &
Light Co., Louisiana Power & Light Co., Mis¬
sissippi Power & Light Co., and New Orleans Public
Service Inc.
;
\; j • "
\x '
(Continued on page 2698)
^
,
.
•
^
:'v iJ'V
THE COMMERCIAL &
2698
\
(Continued from page 2697)
-
j
Z
the capital stock from $5 to $2.50 a share, and
the authorized capital stock ftorn 1,400,560
Standard Gas & Electric Co.-£v.
-
crease
May 15 hearing will be held before SEC on application
of Standard Power & Light Corp. for authority to sell
from time to time all or any part of 1,600,000 common
shares of S. G. & E., now owned by it, such sales to be
open or
to
common
shares.
•
Joliet, III.
to. increase
Willys-Overland Motors, Inc., Toledo? O.
•
000
will vote
on
N. J.
right to subscribe for one new preferred share for each
16
creating a new issue of
common
Kuhn, Loeb & Co. are expected to
preferred issue.
Willys-Real Estate
Realization Corp;, together with Empire Securities, Inc.,
and Willys-Overland Branches, Inc., are expected to pur¬
chase any comnton shares hot subscribed for by common
underwrite
preferred stock. It is proposed to offer the new
preferred in exchange for the 7 % preferred stock share
for share. Unexchanged 7% preferred will be called tot
<
redemption. It is not the present intention to issue any
neW preferred except in exchange for the 7% preferred.
Wisconsin Power & Light Do., Madison, Wis.
United States Radiator Corp** Detroit
April 23 under dissolution plan of North West Utilities
April 24 annual meeting adjourned to May 15 when new
plan of recapitalization and refinancing should be ready
for submission to stockholders. Previous, plan rejected
contemplates refunding its
1971 with lower cost
obligations. Possible bidders would include Dillon, Read
& Co. Inc., and Halsey, Stuart & Co., Inc.
It is rumored that company
3%s of
by stockholders March
1 last.
Co. filed with
Probable underwriters,
White, Weld & Co.
Yonkers
was reported that company may possibly re¬
fund its $47,000,000 first mortgage 3^43 of .1971 with a
lower coupon issue.
Possible bidders include Halsey,
The Farmer and National Debt
ers
prediction "of "the ^Department of
Agriculture that cash receipts this
year from farm marketings will
fall
only half a billion dollars
short of the record of $20,700,000,000
1945—and
of
what
do
"
community.
Financial
you
much in his checking ac-
has a, big
the clock
roll of
currency
behind
is
not
from
income
farm
you deal mostly with
farmers. I do not need to tell you
what we have in this situation.
.
unwise investments
he may turn to some other source
when he again needs credit.
On
the
other
sub¬
hand,, if he has
stantial holdings in Savings Bonds
he will likely come to your bank
when he needs money. If his an¬
the power
ticipated income would cover the
in uranium 235—it can
loan in e reasonable, time, you cah
be a power, for good or it can blow marketings will again approach
talk the possibility of his har¬
ithe farmer #11 the way back to the 1944 level.
This will mean
rowing
instead of redeem¬
1920.
that the farniers of your State
ing Savings Bonds. When the loan
The outcome depends largely will get an estimated $60,000,000
is paid the farmer will stili have
upon what farmers do in this crit¬ more in 1946 than they did in
his financial reserve in Bonds ■ &rid
ical year 1946. What they do with 1945.
will continue to be a sound credit
their savings and their current in¬
risk for the bank, not to speak of
A Hazardous Business
come
will affect their welfare
how much happier the former
and yours for at least a generation
During this year of 1946, many will be.
to come/ And what they do de¬ farmers will be solicited to in¬
A recent survey made by the
pends to a large degree upon the vest their wartime earnings in Department of Agriculture indi¬
advice they get from their bank¬ speculative enterprises, most of
cates that 62% of the farmers of
We have something like
locked Up
...
ers.
which will have little or no merit
,
or
the wall.
chance
ers
if
1'•
Farm Land Prices
why you gentlemen Can
play such an important part in our
infinitely better off
present program.
balance the necessary
We have seen that 1946 farm in¬
;they
risks of
in he United States are
71%
above the
1935-39 levels.
That's inflationary pressure very
their
financial
soundest
average
farm
prices
United
of
be
will
land
Today,
survival.
Farming
itself is a highly speculative and
That's
hazardous business at best. Farm¬
kind of
Prophet Daniel from Washington
to point out the handwriting on
I come before you as a
»
business with
own
reserves
invested in the
possible
s e c u r i t y—
Savings
Bonds.
States
There is nothing that
will be bet¬
your
community in the
long run than to get farmers to
hold the Savings Bonds they now
the point where the boiler
might "bust." v .
s
: s •* ,
ter
near
for
Reckoning 1912-14 averages as
100, farm real estate prices in own and to make substantial ad¬
'
Mississippi reached 155 in 1919, ditions to them.
;
right- after World War 1/ and
To help you reach those with
„
climbed
1920.
218
to
in
the
peak
of
have planned the
first
extensive
peacetime ^pub¬
licity promotion for United States
Savings Bonds, starting on June 6,
excess
Prices dropped to 73 during
the depression low point of 1933.
At the outbreak of World War II
in
1939, this figure stood at 106.
It had risen to
riod
and
one-half year
September,
from
a
end
disaster such as farm-
siphon the overflow
of
this purchasing
power into
savings accounts, insurance and
United States Savings Bonds in
tive
that
order
we
to
hold
the ;
lid
;down
against pressure on prices.
amount
as
never
This
the
program
self-interest
before.
of
money
available
It is not only good for
your
community, but I believe it is to
the self-interest of bankers to
get
funds
|
more of the farmers' present cash
holdings and current receipts into
turing bonds held by commercial
banks, (3) provide personal se¬
scarce
...
for*
for
bestr'Md
the
social
to
the
retirement
Gentlemen,
most
of
your
friends, neighbors, and customers
are interested in personal finan¬
cial security more than anything
else
of
You don't have
this earth.
on
be
to
that
told
you. serve
your
interests by helpihg you? de¬
own
positors toward this goal/ Cash in
the bank or in the pocket tends
to slip away into non-productive
channels, thereby weakening your
Community.; There
always
are
on hand, td see
to this and 1946 may! set another
plenty of slickers
bumper
record—a
crop
suckers—if
we
of
crop,
don't watch out.
I cannot stress too
strongly that
promotion
by ' the
Treasury Department will be in
the future, as it has been in the
past, beneficial to the banks in the
all
thrift
end.
Th0r6f°re, we^^cati solickyour
aid
not only as
obligation, to
an
country but as a solemn duty
your
to your
depositors and in the in¬
terest of your oWh bank.
TfiO fate
of the American farmer,
I repeat,
Sfcsk Offered
by
Groap
Paul H. Davis
,
Paul H. Davis
banking
&
Co. head
Co., Inc., priced at $15 per share.
Company distributes in this
country some of the world's fore¬
most watches, the movements of
which are made by the interna¬
tionally - known
Longines
and
Wittnauer" companies in Switzer¬
land and other companies. Others
in the banking group include A.
C; Allyn and Company, Inc. and
Emanuel, Deetjen & Co.
The
The stock being offered today
represents a portion of the hold¬
ings of
a
large stockholder and. no
proceeds from its sale will accrue
to the company;
The company,
however,
has; registered
its preferred stock will not have
to be registered again with the
sion.,
with it.
r
Two years ago, our
brothers and
the bloody
dying in
were
sons
battle
hedgerows of Normandy, on the
beach at Iwo Jima, in
the grave¬
yards of Okinawa. They did what
no human force w^s supposed to
be ; able
were
they
do;
to
in Berlin in
a
:
If
the
tackle
we
present
smashed
and
the
'
win
of
with • one-tenth the
double
that
can
farmer
even
from
lonesome road
ruin. And
on
war,
gentlemen,
keep the American
going
down
that
again—the road to
the welfare of the
ma¬
farmer,
God bless
the welfare of
us
him, depends
all.'
;
.
Commis¬
,
"
.
Net earnings for the year ended
31, 1945, after all charges
provision for taxes, were
$195,506 as against $206,963 in
1944 and $170,140 in 1943.
Net
for the nine' mdnths ended "De¬
March
and
.
cember 31, 1945 were $417,369.
Capitalization will consist of 50,000
shares
^cumulative
; of J $1.20
convertible preferred stock,
with¬
out par jvalue^ and 500,000 shares
of comon, $1 par
shares will
of which 400,000
be^outstanding.
mam "
•
/
,
;
'
problems
determination and will it took to
we
'
in Tokyo
year,
few weeks late?, *
k
/
West Wall
Hitler's
un¬
issued common stock so that any
of this stock issued in converting
Securities and Exchange
—you've got to go out and
109,009
shares of its authorized but
of his banker. This is not a situa¬
tion that can be met sitting down
a
today
which
Is
making public offering of 125,000
shares ($1 par) common stock of
the
Longines-Wittnauer
Watch
group
depends largely upon the wisdom
for
goods, (2) maintain wide¬
spread ownership of government
securities, and
at the same
time, give the Treasury additional
A Reserve for Farmers
individual.
The
security • that
anyone can have is a safety de¬
posit box full of United States
Savings Bofids.
curity
through
harvest time in the fall.
pe¬
1939,
w.«in a
tion of the present trend can
000 last month—makes it impera¬
important ends—(1) ease the pres¬
sure
on
prices by reducing the
Day.
dramatize
theme
24% jncrease
months alone. I
not tell you that continua-
only in
approach the all-time high.
This, plus the vast accumulation
of liquid assets in the hands of
individuals — about $181,000,000,-
tion, we are planning another
campaign which will come after
will
the past four
need
will
In addi¬
dependence
firm rrval
estate in Mississippi has increased
90% in price
could e&sily equal the all*
time high of 1945.
It is also true
that the national income for 1946
come
Savings Bonds Best Security Aid
We urge the bankers of Missis¬
sippi and the nation to help us si¬
phon excess funds into Savings
Bonds. This will serve three very
March
thrOUgh
in
we
anniversary of D-Day in
France, and ending on July 4, In¬
1945, after World War II, and had
as of March, 1946. It
had only 23 points to' rise to top
the folly of 1920. In other words,
the six
cash,
second
172 in November,
reached 196
in
the nation prefer to buy Savings
Bonds
through
their
bankers,
,
.
'
has saved in
marketings in Mississippi in 1944
amounted to $369,000,000. In 1945,
due to bad weather ..and * labor
conditions at harvest time, income
dropped to approximately $300,000,000.
However, the prospects
for 1946 indicate that income from
Many,of
;•
suffered in the crash of 1920.
bank and
'
.
as
likely to be a
You remember well the effect that
customer for hank credit any time
boom and "bust" had on your
soon.
If he dissipates what he
•
have?
times
couht as he used td have or whir#
(Continued from first page).
j:
Inc., and Kuhn, Loeb & Co.
United States Savings Bonds. The
farther who has three or four
Consolidated Edison Co. of
Inc. applied to New York P. S. Commission
authority to issue $9,000,000 30-year debs.* int. rate
not to exceed .2%%* to be guaranteed by parent
Issue
to be sold through competitive bidding.
Possible bidders
include Halsey, Stuart & Co;, incv; Morgan Stanley &
Co.; Lehman Bros., Harriman Ripley & Co. and Union
Securities Corp. (Joint); Blyth :& Co., Inc.; Shields &
Ca and White, Weld & Co. (Joint); W. C. Langley &
Co.; Merrill, Lynch, Pierce, Fenner & Beane ahd KiddeW
Peabody & Co. (jointly).
for
Wabash RSilvifay
Stuart & Co.,
Electric Light & Power Co.
New York,
May 1 it
that public offering of between
1300,000 and 1,000,000 shares of additional capital stock
how : being negotiated with underwriters.
The actual
size of the offering will depend on progress of financ¬
4 it was stated
(N. Y.)
Jan. 21 company and parent
Additional stock will be used to obtain
working capital and for purchase of assets of Vacuum
Concrete Corp., parent, which it is planned to liquidate.
Probable underwriter, Hanson & Hanson,
shares (par $1).
United Drug, Inc.
Co.'
consin
New York
reported stockholders approved increase in
authorized capital from 310,000 shares (par $1) to 350,000
3
& Co. Inc.
May
(parent), pro¬
bidders include?MerHli Lyhch, PierC:e^ Fehhe^ & Beahe^
White,-Weld & Co., Glore, Forgan •& Co., dnd The Wis*
Vacuum Concrete I no.,
May
SEC,. Middle West Corp.
to invite bidk for sale of not more than 32,000
shares of common stock of Wisconsin, as would not be
distributed to stockholder^ of Middle West* Probable
poses.
,
Union Pacific RR.
May 9 it was reported officials are considering the ques¬
tion of meeting the $100,000,000 first mortgage railroad
and land grant 4's due July 1, 1947. However it is felt
maturity date is too far away to determine now whether
issue will be paid -off in cash dr will be refunded. If
company decides to refund through new issue probable
bidders will be Kuhn, Loeb & Co., and Halsey, Stuart
the
stockholders.
■
Missouri
shares held and one common share for each
eight shares held.
cumulative preferred stock junior to the present
7%
[
Textron, Inc.
April 30 it was stated that a plan was under way to
finance a new company to acquire the assets of Nashua
Manufacturing Co., 95 % of the common stock of Which
is owned by Textron, Probable underwriter, Blair & Co.
•
m
ately. Authorized common would be increased, to 4,100,from 2,850,000 of which 310,000 additional shares
Common stockholders Would be given
100,000 $2 preference stock.
Allyn & Co.
United States Lines Co., Hoboken,
•
4*£%
$90,000,000
1
•
250,000 shares of preferred stock, of which 155,000 shares
carrying dividends, not to exceed $4.50 per share and
convertible intcf common stock wouldbeissued immedi4:
proceeds of which will be used to redeem
June 4 stockholders
(Inc.).
outstanding
RR.
would be issued.
May 6 it was reported company had under consideration
financing. Probable underwriter, Harris, Hall
Union Electric Co. of
Pacific
May 29 stockholders will vote on authorizing an issue of
authorized
stock (par $1) from 400,000 shares to 1,000,000
Company contemplates sale of 165,656 addi¬
tional shares,
Kalamazoo, Mich.
Paper Co.,
voted
stockholders
at $35 a share outstanding
Probable underwriter A. C.
Borne new
& Co.
name
United Printers & Publishers InCi*
April ■-10
proposed merger of Sunray and Transwestem
Oil Co. announced, subject to stockholders' approval.
Public distribution of securities of Sunray is proposed
•With Eastman, Dillon & Co. principal underwriter^.
Sutherland
Stockholders also approved a twocapital.stock. A proposal
of the company to United-Rexall
also voted. Probable underwriter, Smith,
change the
Drug, Inc., was
Barney & Co.
•
May 1
V
to in¬
shares
5,000,000 shares.
Sunray Oil Corp,
r
,
April 11 ICC conditionally authorized company to issue
$10,000,000 first mortgage bonds, series B, due Jam 1,
1981, proceeds to be used to refund a like amount of
first mortgage 4% bonds due Jan. 1, 1974, and held by
RFC.: Interest ra te to be specified in - bids.
Probable
bidders include BIyth & Co., Inc.; Bear, Stearns & Co.;
Halsey, Stuart & Co. Inc.; Merrill Lynch, Pierce, Fenner & Beane; Shields & Co., and Glore, Forgan & Co.
for-orie split of the present
be made in the
private sales for investment or to
counter market.
either
to
: : Western
'
discussions ; and prevailing^ business , conditions.
Stockholders voted May 14 to. reduce the par value-Of
ing
V j
;
>r
}
/(
Thursday, May 16, 1946
FINANCIAL CHRONICLE
-
Vr.-v;
Roy Rife With Bache & Co.
.^Special
to The Financial
Chronigle)
CINCINNATI,; OHIO —Roy, E.
Rife
has
Bache
become
Co.,'
&
Building.
associated with
Dixie
Terminal
Mr. Rife was formerly
general manager for the Cincin¬
Board of Trade and prior
nati
thereto for many years was
Thomson &
McKinnon.
..
JS..
with
Volume 163
Number 4490
THE COMMERCIAL & FINANCIAL CHRONICLE
2699
erence
Carey Defends Restriction
i
"
its
'lliSiOnllnterest Rates
in essence
| is
that such control
was
is
* Government
;
invested
in
bonds arid
U.
the
and
opportu-j
-
"The
both
of
interests
best
S.
the
banks
the current year, and show no
signs of improvement in the im} mediate future as a result of the
banking code and a pro¬
to insure its adoption next
gram
j
?
icy^emphasizing lovt interest rates.
('In this connection, some United
I States
Government bond issues
I have dropped over 3 points dutr
ring the past ittQnth and a further
spent on the revision and the
bank and trust com¬
commercial
section was submitted to the
Legislature in the closing weeks of
in bond values
their
sessions
late
too
but, unfortunately,
for
adoption into law.
•
;
<
Your committee, our Banking Ad¬
^Mortgage money is overabunvisory
Board,
the
Bureau ; of
..'4 dant and has forced down mort- Banking and the several attorneys
i gage rates of interest. Furtherr
attached to these groups tried to
Lmore*. mortgage loans are being 'crowd three
years' work into one,
jnade on highly inflated real estate and
very nfearly succeeded in ac¬
Itpl accounts.
,
is with Carver &
75" Federal Street.
an
.
attendant increase
complishing
in the Credit risk. Reserves should
be set up against possible losses
*
.
'
it's
suggested
of periods of eco¬
nomic stress within the next few
jf
recurrence
:'
r
years. ;
'.ill
an
the
However,
task.
wind
that
blows
revision
and
also
add
the
savings
banks
section
on
which considerable work has al¬
■
Co., Inc.,
"I
rolls—have substantially increased
won't
discuss
the
details
of
the changes at this time as most
of you have read the revision and
during the current year and prob¬
ably will continue to increase. ■'
these
OAKLAND,
C;
Bramble
has
become associated
wi.h Ira Ilaupt & CoM 10 Post Of¬
fice Square.
In the past he was
with W. F._ Rutter & Co.
(Special
to. The Financial
BOSTON,
Rinaldi is
Chronicle)
MASS. —Joseph
with Lerner & Co.,
now
10 Post Office
M.
Mueller
apply them in a way that would
the least possible irritation
Washington. Official circles in
London hope that, if the break¬
cause
•
in
with
CALIF.—John
has
become
<
but
Central
PORTLAND, ME.;—Sumner W.
P. Leighton has become
associated
with W. E. Hutton &
Co., 188 Mid¬
dle Street.
(Special to The Financial Chronicle)
BOSTON, MASS.—Duncan F.
and
William
E.
Lambert
connected with F. L. Putnam
are
;
RALEIGH, N. C.
Paul
O.
Latham has joined George I. Griffin, Insurance Building.
& Co., Inc., 77 Franklin Street.
(Special to Tot Pinancia® Chronicle) ' '
SAN
(Special
to
FORT
The
Financial
Chronicle)
;
WAYNE,
IND.—Robert
M. Howe is with Slayton &
Co.,
Inc.
FRANCISCO,
Montgomery Street
(Special to Tot Financial
'
SAN
(Special to The Financial
T.
Hunter has
Chronicle)
^OF^-milace
GLENDALE^
become
associated
with Robert L. Winters & Co., Inc.
(Special to The Financial
(Special to The Financial
ton in
firm.
Chronicle)'
FRANCISCO,
is
with
CORPORATION
MILLS
North
Securities
Co.,
has declared the following
Corporation x
regular divi¬
'
The Board of Directors of this
Russ
Building.
1
t
McLellan is with Herrick, Waddell
know the substantial nature of the
Co., Inc. of New York City
BritishersBetting
(Special to The Financial Chroniclx).
&
On Amercan Loan
.
.
,
fore-
jhand .in.the preparation of this
;i tell. It ^as tried in the nineteen ; pamphlet in order to dramatize it
twenties when banks paid interest
II rates as high as 4&% ,on savings
I; accounts,
as well as low rates on
! demand
the
l
to
I
code should be sent to
best
effect.
every
| every legislator, the
bank,
newspapers
accounts, lured on by £ and other; interested publications.
I stimulated conditions following a This should be done well in ad¬
:
world war, a surprisingly similar vance of the next session of the
\ picture, to that we find today.
( When the crash came, we- woke
I wp sadder, wiser, hut much poorer*
I with many of our banking institutioris mere shells of what they
: once were,
ready to tumble over;
as too many did/at the first un-
Legislature. On the first day the
Legislature meets, I would suggest
V favorable
would
that your association sponsor the
bill and have it placed in the
hands
economic wind.
proper
legislative
committee.
<
'
the
of
"Furthermore;
y
I believe it
helpful if you had a
be
"If we learned any thing during
those troublesome days, it was
vorable consideration. If we, in
the Department, can be helpful,
,
:
op
■>
rising* real estate values at 4 to
5V2%, when prime securities like
■
j Government bonds
v
pay less than
half that, it is that such banking
institutions should retain, a rea-
*
thereafter
so
jjust call on
everything
it .will
us
T.
we can
for you;
the Governor
Jordan
and
Thomas
Hogle
&
Co.,
,
507
Street.
'
PREFERRED STOCK
:
'
V.
Attorney General.
to be most
'
(Special to Tot Financial
F.
Flower
Oscar
Sixth
ChroniclkI*"
is
now
F. Kraft
Street.
&
He
affiliated
with
Co., 53d West
was
previously
with Slayton & Co. and: G. Bra^
shears & Co.
ter
LOS
Financial
chronias)
ANGELES, CALIF,--Cecil
C. Russell has been added to the
staff of Revel Miller & Co., 650
South Spring
LOS
nard Brown is with Paul D.
&
disturbances, postwar or otherwise. The control of interest rates
ing
have* to "be' informed
serve
to
4 as
help¬
ANGELES, CALIFv-Beri
Speer
Co., 610 South Broadway.
Even
/,'•
(Special to The finanaal Chronicle)
LOS-ANGELES, CALIF,—Ken¬
neth R.
\.r
*'
,"yr, *
-
^
• •
y'
'h\
<
_
<;s-i >*
Thfe. Proposed Bank Revision Bill
Cutler
^|yy
"In conclusion, it might. be per¬
William R.
To Hold
Spring; Party
CLEVELAND,
1
is
connected with
OHIO
—
The
question
its
and
philosophy
of
the
wisdom of reposing such power in
the Commissioner will be resolved
definitely and permanently when
the bank revision bill
i
fore
the
1947
comes
Legislature
be-
nnd,
spring
party
Sleepy Hollow Country Club
June 21.
Since dinner
the
on
A. Thomas has
become associated
with Dean Witter &
Co., 634 South
:•
membership, the usual guest
>'x
Chronicle)
ANGELES, CALIF.—Frank
Spring Street.
dations wilt be adequate only for
the
Co., 640 South
(Special to The Financial
LOS
accommo¬
therefore, S-68 merely fills in. the privilege will be omitted.
at
business May
(Special to
The
Financial
.
H. Hoerres has
rejoined Bache &
:>
COULTER,
Seereiaiv
THE DUPLAN
'
CORPORATION
Textile Weavers and Throwsters
House.
For this reason, the
steps
case of refusal re¬
main under active "consideration..
The immediate measures
to be taken in
(Common dividends paid each yoor since 1908)'
Stock Dividend of
mon
the
United
shares
based
Develop¬
Kingdom
wishes to withdraw from both
1 share of
for each 50 shares
of record
Fund and the International Bank
for Reconstruction and
that
NOTICE
DIVIDEND
may be
follows:—
(1)-The Government would no¬
tify the International Monetary
summed up as
to
on
com¬
held, to holders
May 20, 1946. Fractional
be paid in cash, at value
last sale
New York Stcck
on
,
Exchange on May 20, 1946. Distributioa on May 2S,, 1946-
or¬
Cash Dividend
30 cents
a
common
on
1
stock of
share to holders of record
(2) The Government would no¬
tify the United States Government
July 15,1946, payable August 1,1946.
that the undertaking given in the
agreement of December 6, to sup¬
Declared May 9, 1946
L,. GORDON HALE, Secretary
•
.
port American
at
commercial poli¬
the coming international
THE BUCKEYE
trade talks, is no longer valid, eventhough the less precise undertak¬
30
The Board
Lease Pact remains, in force,
current trade
Broad
Street
York,
N.
Y.,
April
29.
1946
of this Company has
declared a. dividend of Twenty (20)
Cents
per
share on the outstanding
capital
stock, payable June 15,
1946 to shareholders
of record at the close of business May 17, 1946.
C. O. BELL,
Secretary.
this
transfers to the United
on
States arising from
PIPE LINE
New
ing given in Article 7 of the Lend-
of
Directors
day
transactions. In
tances
to
blocked
as
particular, remit¬
Hollywood would be
they were in 1940.
Magma Gopper Company
■
\
The
import of goods for
which payment has to be made in
dollars would be
drastically
cur¬
tailed.
.% i ■
r
(5) The existing bilateral trade
pacts
would be reinforced, and
pacts would be sought to be
concluded. Countries which have
export surpluses on their trade
with the
be
United
informed
could
Dividend No. 95
On May 15> 1946, a dividend of Twelve and
One-half Cents (12%c) pet share was de¬
clared
on'the,capital stock of Magma Copper
Company, payable June 15, 1946, to stock¬
holders of record at the close of business May
25, 1946.
.7
such
ances
that
sterling
that
can
area
"sterling area
is, sterling bal¬
be
spent
in
any
country.
(6) The existing
imperial
Corporation
Dividend No. 71
On
May 15, 1946,
a dividend of 37% cents
share was declared on the capital stock of
Newmont Mining Corporation, payable June
15, 1946, to stockholders of record at the close
of business May 25, 1946.
per
/
Pref¬
:
Newmont Mining
surpluses
pay¬
V
H. E. DODGE, Treasurer.
Kingdom would
that
only be maintained if
balances,"
Chronicle)
oi
R
strength¬
ment is accepted in
MILWAUKEE, WIS.—Lawrence
15, 1946,
the
new
Bond Club of Cleveland will hold
annual
Staats
Spring Street.
tinent to observe that the whole
S
amendment
'.z
Stockholders of record at the close
to
WILLIAM S..
though the rejection of
vain* yiYA
pa#
I Each dividend 'A payable June 1, 1946,:
two
lidpes in British official cir¬
cles, they are aware that it is still
a long
way to (ratification iri the
'
'
considered
($1
SO cents pa#- share
ened ;
(4)
the public."
! "has been helpful in building tip
:
such protection of. the public's de¬
'
was
(3) Restrictions would be im¬
certain of its advantages in
v ;
it
,
McFarland
posed
They
COMMON STOCK
i
months ago.
Sireet.
(Special to The Financtal Chronicle)
what the bill is all about and be
'
as
cies
.(Special to The
[for period April 23- fo Jond::tj^x^^$li
37 cents per share
"
*'M
rea¬
for the difference is that
re¬
fusal of the loan would no
longer
be considered to be such a
disas¬
ANGELES, ^ CALIF.—Lea ganizations.
LOS
ceipts as a protection of the publie's
deposits against economic
posits.
unpromising. The
"
son
"
rilso
better
even
,
"And don't forget
and the
you
Sixth
.
sonable part'of "such interest re¬
,
Waitt
West
-
during the last few days
when the outlook
appeared
ment
receive. fa¬
and we'll gladly do
Chronicle): ;;
have become associated with J. A.
small committee explain the bill
that institutions which loan money
*
(Special to Tot Financial
LOS ANGELES, CALIF —Willis
Copies of the
■-
.
3Vi% CUMULATIVE PREFERRED STOCK
87'/] cents per share
3Vi% CONVERTIBLE SECOND
dent
.
'
*
STOCK|
CUMULATIVE PREFERRED
$1 per share
4%
~
.
can
~
dends!
American
a
BURLINGTON
CALIF,—
LANTRY, SO. DAK.—Paul F.
_
one
not
co-operation be¬
I;
!
Notice ' *
.
no
is
but merely a lessening
Dividend
Miss
(Special to Tot Financial Chronicle)
Irwin
ratification
to
war
tween the two countries.
formerly with Franklin
Co., Inc.
W.
financial and commercial
of the degree of
was
Ordo
a
ternative
trade
Co., Los
Gatti
SAN
under¬
As it is, there is believed
to be reasonable hope that the al¬
Chronicle)
has: joined the staff • of
Slayton & Co., Inc., Circle Tower.
with
connected
&
investment
Barr
view
—
Angeles
Wulff &
would
Con¬
Adminis¬
DIVIDEND NOTICES
CALIF.
now
Barbour, Smith
by
Washington
sphere.
Chronicle)
FRANCISCO,
Eleanor T. Gatti is
with
INDIANAPOLIS, IND. —James
D.
CALIF.—
P. R. Palmer is with Bacon &
Co.,
256
non-ratification
the
the
defense
measures
necessitated by that breakdown.
Had Britain rejected the terms of¬
fered by the United States Gov¬
ernment, there might have been
some justification for fears of the
development of a spirit of hostil¬
ity between London and Washing¬
—
Ileslin
to
gress,
tration
standing
(Special to Tot Financial' chronicle)
Square.
Chronicle)
down of the December agreement
is due not to any British action
C.
connected
Mason
Brothers,
Building.
Bank
measures
to
j
"The, capital ^accounts in: bank¬ | improvements and streamlining of
LOS ANGELES, CALIF.—Agnes
ing institutions generally are still the proposed code. If any of you
B. Potocar is now affiliated with
thin in proportion to deposits, and ; folks haven't read the revision
Blyth & Co*, lire., 215 West Sixth
^should be further: strengthened. you should be thoroughly ground- Street.
'
■'\
y'i
As the result of the sad experience led in it so that you can help sell it
of banks in the nineteen thirties, to the public and to your legisr
(Special to Tot Financial Chronicle)
all of us, the public, bankers and iators.
: f
LOS ANQELES, CALIF.—Bert¬
"In order to properly publicize
^ bank supervisory agencies, learned
ram S. Urbach has been added to
a hard and costly
lesson.; It was i the proposed revision!(I have sug¬
this: A bank cannot pay out to gested to your association that it the staff of Buckley Brothers,
530 West Sixth Street.,
| depositors most of what it earns be printed in final form and a
*
and at; 'the same time protect the I pamphlet be prepared showing
(Special to TOT; Financial Chronicle):
?:
deposits of such customers by the changes and advantages of the
LOS ANGELES, CALIF.—Ken¬
( building up
capital or surplus new code* as compared with the
buffers to take; the shocks of fu- old. Your public relations men and neth E. Smith is with Barker. &
v
-; ture
disturbances,; the kind or advertising experts should havd a Co., 210 West Seventh Street.
extent of which
other
and
contrary to declared American
policies. Nevertheless, the British
Government would do its utmost
BEDFORD, MASS.—Wm.
chants Bank Building.
Chronicle)
BOSTON, MASSV— Russell
ready been done.
."Expensegr—particularly in: pay¬
All
en¬
:r>
1
are
Belknap 2nd has joined the
staff of Gregg, Storer &
Co., Mer¬
(Special to^ Tot Financial chronicle)'
no
good' arid we will now have1 an
opportunity to further refine the
in mortgage portfolios as we have
no assurance that we won't have
a
S. L.
"
(Special to The financial
■
values with
couraged.
E.
pany
would seriously affect bank .cap-
«
Kidd
(Special to The Financial
"During the past year, a tremen¬
dous amount of time and effort
was
barter transactions would be
Chronicle)
BOSTON, MASS.—James
tSSjl
year.
} TJ. Si Qovetriirient's financial pol-«
Financial
NEW
people of this state.
and last subject
the
of
'
The
(Special to Th®' Financial
Chhonicle)
:
second
which I would like to call to your
attentioriKis the- proposed revision;
i
to
re¬
your
"banking
associations,
your Banking Commissioner and
your legislators
may
have the
benefit of your views and so be
able to reach ? decision in the
,| this field have decreased during
i
known so
to
(7) The raising of private cred¬
for financing
imports, pur¬
— r
spective
pities for profitable Investment in
| substantial drop
passed
make your conclusions
that the committees of
"The^ major portion of dejpositr
;
is
"Looking forward to the time of
decision, therefore, may we sug¬
gest that you carefully consider
this matter from all angles and
among other things, called attenI tion to the following factors ^ •
?; ■
funds
•
(Special
Co., 229 East Wisconsin Avenue,
BOSTON, MASS.—Paul S. Vait- after serving in the armed forces;
on ses, Jr. has joined the staff of
?!$•&)••
'*'■
;'y-■'tyi&lij):*': '-Ji
W. H. Bell & Co., 49 Federal Street.
(Special ta Tot financial chronicle)
next year.
f
ors'
the- revision
until
longer necessary as condi| tions have changed and the individua! bank boards are competent
*
to decide, and should, decide, what
I can be paid safely to depositors in
; the form of interest or dividends
% on time or savings^deposits." Cbn,
tinuing, he said: <v * ;"n * v -;
I
"The proponents of Senate 68
no
sought
chases abroad against payment in
blocked
sterling
balances, l and
f Continued from page 2652)
y y
and gap which otherwise would ensue;
| added, "their position briefly
system would be
be reinforced.
'
a.
'
Cj;
'
H. E. DODGE. Treasurer.
2700
Organization Problems oi
•
Tax status |
director of Fund not yet signed.
Announcement of
of executives9 salaries still undetermined.
'
ap-
pointment of President of the World Bank expected in two weeks. >
;
WASHINGTON, May 15.—One of the organizational topics under
of the Inter¬
discussion at early meetings of the executive directors
national Fund has been the
a
President
of
World
the
of
managing director is
staff of
the Fund and conducts, under the
direction of the executive/direc¬
Bank.
The
the chief of the operating
provide for
the
between
the
and
preclude contracts
or
International
Bank
the
on
hand
one
other officers than the man¬
and
aging director and president/re¬
spectively, itr': is ■' said J that no
elaborate
contracts with
other
officers are
contemplated,
,/'
Doubtless the contract the Fund
now,
competence.''£0 01 •/
Though Mr,
Camiile^ Gutt has
managing direc¬
of the Fund, His contract has
been selected
as
Senior Margin Clerks
Elect Cook President
been signed.:. Mr. Gutt
informs the "Chronicle" that the
yet
still
lawyers
are
commas
about.
moving : some
One
feature
j of
contract, early versions
of which were drawn up in the
U. S. Treasury, has to do with a
lump sum payment to the man¬
aging
director's estate, /in i the
the draft
event of his death while in office.
Apparently contemplated in such
contingency is the payment of a
year's salary; in this case, $30,000.
Fund
the
Whether
also pays
es¬
that lump-sum pay¬
tate taxes
on
ment is
feature of the contract
a
the
negative."- The Savannah by-laws
provide that "the Governors and
which
may
be
in
answered
their
alternates, the Managing Director
the Executive Directors, and
shall
members
staff
the
and
required to pay on such sal¬
aries and allowances." The ques¬
are
whether
is
this
language
covers
a
lump-sum payment to
the estate of a deceased officer.
Persons who seem to know an¬
swer
this
tive.
question in the nega¬
They
point
that
out
the
language cited is understood
refer to payments to the
to
individ¬
uals. themselves and not to their
estates.
not
Dealer-Broker
28 years; died at his
age of 74.
Mr. Ed4
heaid; of /Edmonds 8i
Broadway, New York
was.
Co.,. 115
City.—
mendations
...2658
Scqphony, Ltd.
....2648
U.S. Finishing
^
Pnblicker Ind.
I
Mutual Funds
S
„
American Molasses
2646
Literature.
and
Rbodesian Selection
Recom¬
Investment
England Public Service
Gaumont-British "A"
Calendar of New Security Flotations 2692
Canadian Securities.
.2678
monds
NSTA Notes.
v/Mr. Edmonds began, his .career
in/Wail Streetiin .1885, spending Pgr Reporter -on Governments.....2662
30 years in the employ of Contenjt Our^ReporterV Report..............2655
.2650
&, Co. before he bought his seat Public? /Utility; Securities
RaiiroadSecuritiea
i^iJate- Sefcuriti"£s. 0
>,,,,
Avon Allied
,2658
Cinema "B"
2650
-Rear
Securities Salesman's Corner...,,...2664
Claybaugh in New Location
Securities Now in Registration,.
The New York, offices^of Bl^if .Tempxro-W's- Ma^ets—
F.
Claybaugh
22d
the
where
&
floor
the
have
Wall
.
.,
.2692
..,,,.,..2691
Walter Whyte Says
m.s.wien&co.
ESTABLISHED
to
/Michigan Securities Section on
page 2648; Connecticut and Mis¬
souri on page 2649,
Street,
firm
has
facilities.
and
space
been
Street
52;,lfWall
of
investment
^
additional'
Co.
72
from
removed
The
J&lephone "humber remains
unchanged—Whitehall 3-0550.
Members N.
40
1919
T. Security Dealers Ats'n
Exchange PI., N. Y. 5
T«letm
N.
Y.
HA. 2-8750
1-1397
:T'-'>V*
./*See under "Securities Now in
Registration"
Estate and gift taxes
Walter Cook of
Meeds
on
president of
the Senior Margin Clerks Section
of the Association of Stock Ex¬
change-Firms. ' Georgev A. Hug,
Henry Clews & Co., was named
vice-president; Walter Hanratty,
W. E. Burnet & Co., was chosen
treasurer; G. Arthur Behrpaanri,
Hirsch
&; Co;,
secretary/. and
Douglas Calder, Hayden, Stone &
Co., assistant secretary.
2692.
page
Guy Pepper,
Hornblower
&
Weeks; Joseph A. Steiner, Carl M.
Loeb, Rhoades & Co.; James J.
Clark, Hoppin Bros. & Co.; Ger¬
ald P. Kossmann, W. E. Hutton &
Co.; and Anton Benson, Paine,
Webber, Jackson & Curtis.
are
is nothing
in the
6% Pfd. & Com.
Ironrite Ironer Com. & Pfd.
Kropp Forge
Baltimore Porcelain Steel
Kut-Kwick Tool
Bendix Home Appliances
Buckeye; IncHbator-^^
Clyde Porcetaiii Steel
Lear Inc.
Majestic Radio & Television
O'Sullivan Rubber
•
'
_
Merica
Department
ire;
.
-
Virginia Dare Stores
/
merce
Building,
Howard J.
Corporate
now
Manager of the
.
1945,
1,
Nov.
three years
approximately
in the Armed Forces.
He is assisted by Robert
We specialize in all
,
Insurance and Bank Stocks
Industrial Issues
Kobbe, Gearhaft &; Company
"•••»*
«'
•Members
-
o;--'•.stjf
New
WAS SA
York
if
Public Utility Stocks and Bond*
TEXTILE SECURITIES
Security Dealers Association
EW
ST BE
YORK
5
Bell Teletype
-YHiladelphia telephone
TELEPHONE-/
RECTOR 2-3tt$T
Investment Trust Issnes
..r
I:' ^Enterprise 6015
new
york
Securities with
Frederick C. Adams & Co..
Specialists in
Neto
A Market Place for
:
England Unlisted Securities ^ f
1
■
I
24 FEDERAL STREET, BOSTON 10
Low Priced Unlisted Securities
Established In 1922
Tel. HANcock 8715
Jardine
Diesel Equip.
Kinney Coastal Oil
Fred T.
Helicopter
SIMPLEX
Copper Canyon Mining
Duquesne Natural Gas
Petroleum Conversion
Recordgrapb Corp.
A potential
Rett Bank Oil
JEkctricSteahi.S^ipin^
ficiary of the:
Federal Asphalt
Reiter Foster Oil
Gaspe Oil Ventures
Southwest Gas Producing
Haile Mines
Standard Silver & Lead
United States Television
Holding
I
PAPER CO.
Rademaker Chemical
||
»
;
Ley & Co.
Martex Realization
Differential WheelsL
!
Tele. BOston
Mining
Automatic'Signal
postwar
bene?
Automobile,
Building,
and
Frozen Food
E. Bor-
Industries
Morris Stein & Co.
toh.
50 BROAD ST., N. Y. 4
Teletype—N. Y. 1-971
***
^Established 1924
...
.
HAnover 2-0050
|
New Eng. Marked
a
1-576
Huron
Department.
Trading
Eble returned
after
that
announce
Eble, Assistant Vice-
President,: is
Mr.
Union Com¬
BS 328
^WiIcox:6ayCorporation
.
Costtiocqlor* 5^
OHIO—Wm. J.
CLEVELAND,
Mericka & Co., Inc.,
Teletype
Cargo
Bendix
; ;
New York
Hanover 2-7913
-.On'
Greater N* Y* Industries
45
9, Mas#.
Botton
.Yentnoir Boat Works
Globe Aircraft
Aircraft
:
irMilk Street, Boston
Hubbard 6442
^ Trans-Caribbean Air
General Panel
Higgins, Inc.
RALPH F. CARR & CO.
Corporation
/ Sheraton
Telecoin Corporation
Du Mont Laboratories..
.
included in the provision.
While there
Laird, Bissell &
H. J. Eble to Manage
Int'l Resist.
^
Artkraft Mfg. Com. & Pfd.
D. B. Fuller
elected
was
AmalgamatedSugar.«•
American Time"
Consolidated Industries
be
by, the International
Fund for the taxes which they are
reimbursed
tion
New
Page
Stock........2672
Items... /. 2699
Personnel
for the past
home at the
Fund
,
net
Insurance
and
Broker-Dealer
,..,,
Bretton Woods Agreements or in
the Savannah meeting by-laws to
ordinary busi¬ makes with its managing director
will be used as a model when the
ness.
Both he and the, staff owe
their whole duty to the Fund and World Bank gets around to elect¬
must
respect
the f international ing a president.
character of this duty, the BretIn reliable quarters it is stated
ton Woods Agreement provides. that within two weeks the Ad¬
The managing director appoints ministration's choice for president
the Fund's staff, with due regard of the World Bank will be an¬
to geographical considerations as nounced.
•
1
■well
as
efficiency and general
tor
Bank
'.0S
r-'if:
v
member'
Edmonds,
Fund's
the
tors,
E.
drafts 3>-
contract of employment
of
the managing director.
The
managing director is hired for a
live-year term under the by-laws
drafted at Savannah.
This posi¬
tion in the Fund corresponds to
that
William
of the New York Stock Exchange
International Fund and Bank
Contract with managing
INDEX
William Edmonds Dies;/'
/
ing of
Thursday, May 16, 1946
THE COMMERCIAL & FINANCIAL CHRONICLE
;
Only
HANOVER 2-4341
^ TELETYPE,—N. Y.
a
small issue of
\7^
rP*'-'-I
*.
com¬
stock*
mon
1-2866
"'J
;
1 ,*<
***
Firm Trading Markets
Recent Price..
BRITISH SECURITIES
,
;
Ml'
,
,
Write
All Issues
tall
or
101/4
'
•
far
descriptive
analysis*
CARL MARKS & CO- INC.
■'
FOREIGN SECURITIES
Bank—Insurance
SPECIALISTS
50 Broad Street
>
.
'if
'
*
^
*
Puklic
Sunshine Consolidated
■
(A
Pressurelube, Inc.
U. S.
Radiator, Pfd.
low
.■
^
Reiter-Foster Oil
priced
common
V Average
j'
dividend
$1.04
earnings
per
<
for 5
New York 5
Telephone COrtlandt 7-0744
Current position 4.4 to
Available under $6
Bell
Teletype NY 1-886
Amos Treat
BO 9-4613
r
„
£
n
f<
^ /**
>
'Real Estate
per
{A
/
P
.p*\*v
>)
P Pi
'\w '<w->*, i«**
y*
SOUGHT—SOLD —QUOTED
years
CAP.
St., Boston 9, Mass.
0425
i
5
Teletype BS
269
^General Products
Corp.
'"Susquehanna Mills
Empire Steel Corp.
Prospectus
on
request
1
share
& Co.
New York 5,
aLmmmmmmmmmmmmmmmmmmrna i
*\ N. Y. Telephone HAnover 2-7914 r
.
REMER, MITCHELL & REITZEL,
208
Wall St.
^
*
2.
40
\V
•
W. T. BONN & CO.
Broadway
\
share
3.
120
r
Bonds, Prelejrred and Common Stocks
paying
stock)
t
Xumker & Timber
>>''iiK*
Engineering Works
j
*
Utility—Industrial
:
Northern
San-Nap-Pak
%
State
148
Tel.
New York City
-
*
N. Y.
Tele. NY 1-1448
SOUTH
LA
SALLf ST., CHICAGO 4
WESTftN-UNION
TELEPRINTER "WUX"
•
•
INC.
PHONE RANDOLPH 3736
BELL SYSTEM TELETYPE
CG-989
Hill, Thompson & Co., Inc. j
Markets
120
and Situations for Dealers
Broadway,
Tel. REctor 2-2020
New York
S
Tele. NY 1-2660
[
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