Full text of Commercial and Financial Chronicle : May 29, 1958, Vol. 187, No. 5746

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ESTABLISHED I S3 9

cKOI i

UKiV

J'j;l

lwwi

BUSINESS ADMINISIIA'

LIBRARY

Reg. U. S. Pat. Office

Volume 187

Number 5746

New York

7, N. Y., Thursday, May 29, 1958

Price 50 Cents

Copy

EDITORIAL

Nonetaiy Policy Owing
See It
Current

Meeting and Conquering
Challenges of Our Time

A Period of Recession

Writing in the April issue of the Survey of

By ALFRED HAYES*

Business, Clement Winston of the De¬

By BENJAMIN F. FAIRLESS*

President, Federal Reserve Bank of New York

partment of Commerce, had this to say about con¬
sumer
buying in recent years:

President, American Iron and Steel Institute

N. Y. Federal Reserve head fears immediate dangers ofmore than those of
inflation and trusts our

That there is confidence in

our
economy and that we need
confidence, Mr. Fairless heartily agrees; bnt he
does insist that truth i go hand in hand with confidence.
With this in mind, the steel leader asks that we face up
to hard problems we have to overcome and strongly

recession

"While the decline in

spending from the peak
of 1957 to the first
quarter of 1958 was relatively
about the same as that in
disposable income, there
have been wide variations
among the commodi¬
ties. In some cases there has been the
expected
response to a lower income. In others buying has
shown appreciable independent movements
by
continuing upward or by undergoing excep¬
tionally large reductions,
j
"The

serve's "record in the past

durables

where to

the recession is

near.

important
agement

looks to the more
role of fiscal policy and labor-man¬
advances the case for supplemental

recovery

efforts;

controls; praises rise in foreign reserves
strengthening international economic trading
ties; and interprets gold flow movements as a healthy
sign showing our international gold standard is working

and urges

considerable

of commodities. For the group as a
whole, purchases had fallen off gradually during
1957, and by the fourth quarter consumer expen¬
ditures for durable goods were 4% lower than in
the opening quarter on a
seasonally adjusted
basis. The largest decrease,
however, came in the
first quarter of 1958 when dollar purchases of
durables were one-eighth below the first quarter

About

the

evaluating these developments, the trend in
durable goods outlays in recent years should be
kept in mind. From a low in the fourth quarter
of 1953 these outlays rose about one-third to a
peak seasonally adjusted annual rate of $37 bilpage

one

restraint.

did

not

turn

erred in

would

soon

holding

too long to

but

ity of the people have
ment

danger.

Whether the timing

which every

present

can

Benjamin t. r airless

undertakings in

complete picture of issues
our

now

opinion-holder, it
a

California

fancy,

Continued
♦An

page

investors in

corporate

State, Municipal

38.

and

Vft

STATE

Bonds and Notes

chemical

LATEST

BONDS

HAnover 2-3700

ARE NOW AVAILABLE

and

MCMOCRS NEW VOKK AND

30 BROAD ST.,N.Y.

15 BROAD STREET, NEW

•

T '

' 7

•

Dl 4-1400

New

Members

OF NEW YORK

Company

YORK 5, N.r.

York Stock

120 BROADWAY,
Bond Dept.

Net

Distributor

T.L.Watson &Co.
1832

ESTABLISHED

Members

Teletype: NY 1-708

Active

Dealers,

Markets

Banks

35 offices from coast

New York Stock

Exchsnre

Brokers
Capital

CANADIAN

STREET

NEW YORK 4, N. Y.

DEPARTMENT

the

Province

DIRECT

HIRES TO MONTREAL

PERTH AMBOY

Municipal Bonds
for California's

April 15, 1963

Payable in United States
Price

;

AND TORONTO

100 to

Expanding

Dollars,

Economy

yield 4%
MUNICIPAL BOND

NEW YORK

1 NORTH LA SALLE ST.
CHICAGO

DEPARTMENT

Jbxmoa Securities

Goodbody & Co.
115 BROADWAY

lJ
V

Alberta

CORPORATION

MEMBERS NEW YORK STOCK EXCHANGE
•

BANK

4% Debentures
Due

Executed On All

Canadian Exchanges

Exchange

BRIDGEPORT

■}
•

Chase Manhattan

Teletype NY 1-2270

DALLAS

to eoast

City of Edmonton

Exchange

American

gotdJlWeAt COMPANY

$100,000

Maintained

and

CANADIAN
SECURITIES
Commission Orders

25 BROAD

THE

NEW YORK 5

TltETYH NY 1-2242

Stock

4»•}

BOND DEPARTMENT

REQUEST

Harris. Upham & C2

AMERICAN STOCK EXCHANGES

CASLC: COMJSMHAM

LETTER

THE FIRST NATIONAL CITY RANK

Burnham

•

DEPARTMENT

view

burnham
MONTHLY

FIELD REPORT

BANK

Dealer

Public Housing Agency

MUNICIPAL

and

COPIES OF OUR

CORN EXCHANGE

FIRST

address by

Municipal

•

with

Mr. Fairless before the 66th General Meeting of
American Iron and Steel Institute, New York City, May 22, 1958.
v

"Securities in Registration" Section, starting on page

the

Underwriter

Honolulu

importantly—the real steps that will take us back to the
as rapidly and as soundly as possible. We see

registered with the SEC and P°ten"

Securities

BOND

And

main road

U. S. Government,

telephone:

seems

cause.

must find the answers. We

State and

different

for

must find the real causes and—more

Mr. Hayes before the 55th Annual Convention
Bankers Assn., Atlantic City, N. J., May 22, 1958.

NOW IN REGISTRATION—Underwriters, dealers and

•

recession

the solutions range from eliminating
the coffee break to building a bridge
from

was ex¬

afforded

to agree¬

come

public funds.
J Out of all this welter of fact and

imbalances which had
Continued on page 24

address

have

recession had already been set by

of the New Jersey

the solutions.

Now

actly right I shall not try to argue,
the important thing is that the pattern of

think

recessions of the past, the causes

have been fairly well agreed upon;
and after a while, at least, a major¬

enough—that

securities

DEALERS

; In

policy of restraint, fighting inflation
when recession was already in evi¬
dence and
constituted
the greater
Alfred Hayes

are

ple, and American business,
unique and telling way.

appropriate now to take stock
briefly of what monetary policy has
accomplished in this period—of what
it is supposed to do to combat reces¬
sion and promote recovery, and of
what it cannot be expected to do.
Parenthetically, I am not unaware of

SECURITIES
tial

seem

♦An

passed

various comments to the effect that

"In

Continued

for

ease
i

measures

We are facing, in 1958, a year of decisions of highest
importance to our future. It is a year that is going to
try the mettle of the American peo¬

since the Federal
Reserve System, in recognition of a fundamental change
in
underlying business
conditions,
began to substitute a policy of credit

past,
year has resulted from the sharp fall in demand
for automobiles. Other consumer hard goods have
also experienced substantial sales reductions.
-

have

long-range

adequate for business growth.

it should work.

months

seven

of 1957—the lowest in three years.
over

submitting a
designed to "keep
our economy
strong" and withstand onslaught of com¬
munism. Cautions against wages exceeding prodnctivity
and against tax policies stimulating consumption without
investment as well, and advocates tax reform so that
part of the sales dollar left over for investment will be
blueprint of

selective credit

wide range

"About four-fifths of the decline

advises tax reform rather than tax cut; in

monetary policy has accomplished;

degree purchasing involves taking on new debt
obligations. These reductions have extended over
a

few months in this regard is
are signs that the bottom of
Mr. Hayes takes stock of what

pretty creditable" and there

largest relative decreases have occurred

consumers'

to talk

dread of the latter does not prevent all reasonable efforts
to combat the former—even though the Federal Re¬

Butt It of jWctiat
NATIONAL

Exchange Place, New York 5, N. Y.
Teletype NY 1-702-3
WHitehall 4-8161
40

Icings ASSOCIATION

300 Kontgomeiy St.,

MICHIGAN

San Francisco, Calif.

■

(2390)

T/(e Commercial and Financial Chronicle

For Banks, Brokers,

The

Dealers only

„

Try "HANSEATIC"
0 ur experienced trading

participate and give their

department offers

Trigger-quick
reaches

service and

Contacts through

H. W,

PHILADELPHIA

The

Exchange

SAN FRANCISCO

and

Lay

Harrison

for

1928

American
120

automobile

started

single

amounted

year

22%

sales

1956.

over

and

branches

for

and

Bassett Furniture Industries

Within

over

for

Products

Commonwealth Natural Gas

warehouses

serves

few

distributor

Life Insurance Co. of Va.

lone

Barrett

the

six

STRADER and COMPANY, Inc.

six

the firm at
executive

TWX LY 77

City

1938

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

Nomura Securities Co., Ltd.
61 Broadway, New York 6, N. Y.
This is not

offer

time

now

the

Chattanooga to

routes

started

serve

there

and

Lay formed a corpo¬
headquarters in At¬
buy the Atlanta and
plants of the Barrett

Two years later, Bar¬
rett's Jacksonville plant was ac¬
quired and the realgrowth of

9-0187

solicitation for

orders for any particaar securities

H. W. Lay & Co. had

but

changed to
widely known

"Lay's"
and
the
symbol
"Oscar —the
Happy Potato" was

STREET

NEW YORK 5, N. Y.

SUGAR
Raw

—

Refined

—

Liquid

Exports—Imports—Futures

phasis
try

111

Investment

;

Bankers

Broadway,N. Y.6 COrtlandt 7-5680

;

Burns Bros. & Denton
inc.

Street, New York 5, N. Y.

Dealers

for

Investment Securities

Canadian and Domestic

correspondence

should

courses

continue

its

up¬

Since 1932

In
addition,
International,
through
its
H add on
Division,

well

NORTH and SOUTH

books, mostly

for its

own

CAROLINA

Over

opinion,

can

income

and

„

should

MUNICIPAL BONDS

published

were

■F. W.-

Co., in
bought for

growth
be

should

re-:

RICHMOND,

VIRGINIA

Bell System Teletype:

V-

;
RH 83 & 64

Telephone Milton 3-2861

>■

respond fa¬

vorably to improving

factor

CRAIGIE 8 CO.

this

strongly

sistant to the ill effects of business
recession and

corre¬

division.

Textbook

time.

diem

;

VIRGINIA—WEST VIRGINIA

leading publish¬

school

both

£.rnesi

Specialists in

ward trend.

School,

\:;"

being placed by indus¬
technical ( knowledge, the

International

Correspond¬

Underwriters—Distributors

1.... ' Cj" T '

14,200,000 volumes

business.

Steady growth in sales, earnings

education field.
students

The

served

in¬

steadily and, with the

em-

and

the

dividends
record

are

the

evidenced by
accompanying

table:
Per Share

Sales

Net Profit

$18,491

1956

16,520

1955

14,499

advertising

programs and the rec¬

Net

Dividends

annual
been

increases in sales has
broken since the com¬

$1,300
1,157,

$3.00

6.37

2.30

4.30

1.80

recent
expansion
includes the purchase in
Richmond (Virginia)

13,304

656

3.611

12,069

411

2.26

1.25

1952

10,247

494

2.72

0.50

9,910
9,237

253

1.40

0.20

•

1950

Rising

"lslns

dividends

a'vi"en":

are

111

usually

Chip Co., the purchase in evldence of good management;
satisfactory growth, and sound ex¬
1956 of Capitol Frito
Corp. (which
pansion, particularly when the
serves
Washington, D. C.), and
increased dividend is amply jus¬
the opening
of a new plant in
tified by earnings and a strong
New Orleans in
January 1958.
cash position, as in this case.
The new
$1,800,000 H. W. Lay
There is probably not an insti¬
& Co. main plant and
office build¬
tution of learning that is not en¬
ing went into operation in 1956
deavoring
to
raise
substantial
and
gave • the
Potato

company's
home
plant facilities

main

new

which has been described

plant,

"the

largest and most modern of its
type in the world," has an area

*avmg*

1.45

1953

1951

the

and

$7.23

780
'

1954

Brokers

by this division in 1956.

International

creases

now

demand

ers

the

spondence

com¬

the home

Co., Ltd.
Tokyo, Japan

text books, for 60

of aggressive sales
promotion and

office

promising.

number

Affiliate

Yamaichi Securities

•

1058.

manufactures hard

the

Company

York, Inc.

(OOO's Omitted K

surpassed by none. This
DIgby 4-2727

record

very

....

•

.90

Exchange and Pacific Coast Stock Exchange

growth in the
coming years

leading

New

■

1957

1955

•'

.48

.42

further

The

573,661

earnings,
prospects

pany owns

Securities

.37

The company's growth has been
in part to the effectiveness

program

:.4i

312,705 v. '-

grown

are

.36
,

•

Dividends

and

write

.35

267,975 \

for

information

*Per Shr. Profits

242,217
273,406

growth in sales and earnings Since
1950, and the year 1957 produced
new
highs in
both
figures.
have

Yamaichi

■

$235,853 +

number of shares outstandingMarch 15,

remarkable

Call

Net Profit After Taxes

International Textbook Co. has

had

Lay's- most

WALL

current

The

Over-the-

233,064

due

not

the

For

common

9,251,384

Members: New York Stock

pany was founded.

created.

ord

LAMBORN & CO., Inc.

STOCKS

being

quarterly.

Counter market.

International Textbook Co.

retained

was

100

traded

"Gardner"

was

currently

are

ERNEST STENT

which

branch offices

JAPANESE

equal voting rights.

rate

stock

share-for-

year

the class "A"

the

our

"A"

class

from 1958
The two classes of

through 1961.

paid

each

stock have

Direct wires to.

Partner, Hooker & Fay, «Sam,Francisco;' Calif.**'>>•;

ence

begun.

stock

basis

-Birmingham, Ala.
Mobile, Ala.

closely
percentages of it

7,923,829

*Based

During the early years of oper¬
ation, the Barrett trademark
1944

NY 1-1557

New Orleans, La.

37 Wall

1958/.

stock

convertible. :int;o

common

10,958,989
13,313,870
16,215,022

1957

with

the company opened

Memphis

Monthly Stock

Telephone: BOwling Green

that

positions

company.

IN JAPAN
'

Four of the

with

lanta

were

1939 Mr.

ration

Opportunities Unlimited

Food

who

warehouse in
several

organization

men.

company. ]

LYNCHBURG, VA.

York

hold

Mr.

route

Certain

$8,801,460
9,682,726
i._

Members New York 'Stodk Exchange
Members American Stock Exchange

stock,

common

held.

Net Sales

and

after

years

the

Co.,

consisted

The

also

88 YVks. Ended Mar. 15

17-state

the

servicing five routes.

New

year

:
extending from
Louisiana
Arkansas to Maryland.

Lay took

-5-2527—

the

August .31

located in 12 others.

company

area

American Furniture

sales

293,520 shares
stock, 500 par

common

1957

The company has

sales

are

300

of H. W. Lay &
15, 1958, consisted
shares common stock

1956

than 1,000 employees. Man¬
ufacturing plants are located in
eight
of
the
South's
principal

The

cities

our

Year Ended

of potato chips
foods, H. W. Lay & Co.,

reported

class "A"

are

stock, unless a
paid on the

common

Lay
&
Co.'s
record
value.
The
class
"A"
common
growth, the recent impact of great
stock
is
entitled
to
a
dividend expansion,
and a well planned
preference of at least 360 per program for future development
share in any fiscal year before form the basis for
my opinion that
any dividend may be paid on the the
class
"A"* common
stock,
common stock.
After the common which offers a generous dividend
stock has received 360 per
share, income, represents an unusual opno further dividends
may be paid portunity for capital gains.

ended Aug. 31, 1957, of
$16,215,022,
which represented an increase of

Trading Interest In

Write for

sales

route

Exchange

Stock

as a

Inc.

Wire

own

Exchange

Stock

TEL. REctor 2-781S

Private

his

potato chip man¬

His

and snack

BROADWAY, NEW YORK 5

LD 39

sec¬

Nashville, Tenn.,

first

"A"

largest producers

Members

York

the

than

handled

value and

par

approximately $12,000. The mod¬
est business, founded by Mr.
Lay
in. 1932, is now one of the nation's

McDonnell & fa.
New

Lay, using his

truck,

ufacturer.

Since 1917

Clarke

name

distributor for

SCRIP

company

like amount

Dividends

343,480

500

of Herman W.

RIGHTS

popcorn

of March

class

young man of

business in

are

Steiner, Rouse & Co
HAnover 2-0700

products

Capitalization

ago, an
ambitious

hand

19 Rector St., New York 6, N. Y.

ulation.

Twenty-five

ond

fleet

and

These

profits of H. W. Lay & Co. is
shown in the accompanying tab¬

delivery

nuts.

than 50,000 retail outlets.
The rapid growth of both

ing.

by the

19534

owned

years

Specialists in

distributed

Co.

sandwiches,

salted

indeed excit¬

Principal Cities

Stent, Partner, Hooker &
Fay, San Francisco, Calif. (Page
2)*

rpotato

chips, "Corbutter sandwiches,

peanut

trucks

Co., Inc.

"
include

are

run-

Bought—Sold—-Quoted

est

from

as one of the
plants built in the

new

and

well

CHICAGO

best

sweet cookie

the growth
and progress

■

Wires

Private

more,

story

1920

New York 5

•

are

Louisiana Securities

was

Magazine

Lay's products
chips, Frito's c01*11

ahead of 1957.

Member

•

half

1958

Teletype NY 1-40

EOSTON

ten

the

for

ning

what's

W. Lay & Co., Inc. Class A—
Harrison Clarke, Vice-President,

Johnson, • Lane,. Space & Co.,
Inc., Atlanta, Ga. (Page 2)

and

nearly 1,000 entries

netts,

1956

first

Corporation
120 Broadway,

Maintenance

nation in 1956.

and,
sales and prof-

New York Hanseatic

WOrth 4-2300

-t

„

Lay & Co., Inc. Class A Com. Siock

its

Stock

and

above

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

Associate

«,

feet

square

security I like best is quoted
about 35% higher than a year ago,
profits for fiscal 1957 were 83%

the widest

American

152,000

chosen by Factory Management International Textbook Co.—Ern-

The

sure

>*.Established

be, nor
sell the securities discussed.)

Alabama &.

Their Selections

particular security.

intended

not

are

Vice-President, Johnson, Lane, Space
& Co., Inc., Atlanta, Ga.

nation¬

our

offer

as on

HARRISON CLARKE

wide wire system.
To make

they to be regarded,

•re

broad range

for favoring

Thursday, May 29, 1958

This Week's
Forum Participants and

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

Security I Like Best

(The articles contained in this fornm

funds for its endowment. Harvard

0.61

others
same

will

doubt

But, the private institutions
the

not

the

course.

acquire

only
more

efficiency

and

Taxes

ones

funds

striving
to

are

improve

Over-the-Counter

Quotation Services
for 44 Years

also

expand

facilities.

rising steadily to
support the public school system,
as
every taxpayer knows. And at
the same
time, individuals are
spending
a
steadily
increasing
are

National Quotation Bureau

College alone is conducting a huge portion of their incomes to edudrive to raise $84,000,000 and its cate their children and themselves,
graduate

schools

plan

drives

A substantial part of this outpour-

Established

46 Front Street
CHICAGO

their

own.

Yale,

Princeton-and

Continued-On page

17?

191$
New York

BAN

4rN.V.

FRAMCISOO

'{Volume

Number 5746

137

Commercial and Financial Chronicle
The

(2391)

INDEX

Problems and Prospects

Lamont University

Benjamin
.?■

_________Cover

•

Sell

The

States

;

following comments

have

been

oil

economic conditions in the United,

The

sharply the behavior
businessmen.—S.H.S.

Telephone: WHitehall 4-6551

Events

consumers-and
"

Summary * 7

spread

19&8

would

low quarter of
the

The

the

INDUSTRIES
10

ACOUSTICA

10
:

Stans__

BIRDSBORO STEEL

WESTERN GOLD
•____—

& URANIUM

sheds

decisive
Reserve

e s

production

new

determining

wage-push

con¬

the

for some;

amount of

notion that

months,

:
*

that the liqui¬
dation will re-

ment
Sumner

Slichter

expenditures

Course!

.__

(Boxed)

planned

Exchange PI., Jersey City

^longer at, "the
record-breaking rate of $9 billion
a
year.
And even the Federal
Government, slow-moving and in¬

well understood.

■

efficient

ity because there
over-capacity, but cutbacks are
general. No aspect of the economy

over-capacis no general

it has been in dealing

pected indefinitely to reduce its
purchases of goods and services in
the

face' of

contracting

"Consumer

holding

incomes

consumers,

needs more to be studied
causes

business.

have

vented

remarkably well, and
the real heroes of the

cutbacks

■

may

Lithium

for

the

government

reduce

automobile

industry

and

reduction

outlays

The net result will be

larger rise.
The

picture

recession

presented

that

the

economy

About

estimates

are

the

Gross

course

May_

Governments—

Utility

Securities

-—L_
^

Registration———————;

Offerings————

Security

Securities

Salesman's Corner—i.

The Market

The

and You—By

Table

page

■

Washington

and

Industry—

•

25 Park

U. S.
DANA

—7

You

Twice Weekly

Spencer Trask & Co.

9578

Subscription

;

WILLIAM DANA SEIBERT,

Pan-American
of

Dominion

President

Other

ST., NEW YORK 4, N. Y.

Boston

Chicago

Schenectady

Glens Falls
Worcester

(general news and ad¬
vertising issue) and every Monday (com¬
plete statistical issue — market quotation
records, corporation news, bank clearings
Every Thursday

state

and

Other

Chifcago

city "news,

Offices:

111.

135

etc.).
South

request

Union,

(Telephone STate

$65.00

Canada,

Countries,

per

$68.00

$72.00 per

year,

per

S
of
lr

W> V. FRANKEL & CD.
INCORPORATED

year

year.

39 BROADWAY, NEW

YORK 6

Thursday, May 29, 1958
*

ifProspectus

Subscriptions
in United States, U.
Territories and
Members

Other

Rates

Possessions,

Members New York Stock Exchange

Syntex Corporation*

Publishers!

COMPANY,

Inc.

second-class matter Febru¬

25, 1942, at the post office at New
York, N. Y., under the Act of March 8, 1879

HERBERT D. SEIBERT, Editor & Publisher

TELETYPE NY 1-5

Yonkers Raceway

Company

Patent Office

2-9570

Commonwealth Oil

Reentered

Place, New York 7, N. Y.

REctor

Uranium :

McLean Industries

ary

FINANCIAL CHRONICLE
Reg.

Refining

Wallace,Streete———— 17

Security-1 Like Best

The State of Trade and

WILLIAM

Nashville

shows" the;

recession.

;

preliminary *
ex-

38
•

Prospective

■

Western Gold and

PREFERRED STOCKS

Sabre-Pinon
'.)>■"

„

Albany

if'M

Railroad

Published

25 BROAD

Dallas

—

The COMMERCIAL and

TELEPHONE HAnover 2-4300

Los AngelM

Chicago

have specialized in

Philadelphia

-1.-

,—.

Reporter's Report—

Securities Now

National

quarters

the

Continued

resist contraction in spite of wide¬

For many years we

—

Expenditures and

first quarter of 1958. A compari¬
son
of these figures with figures

;for

Bankers

and

A. Wilfred

—

Our Reporter
Our

penditures and production for the :

displaying impressive capacity to

Banks

Observations

interesting figures of

the last month

Teletype NY 1-1825 & 1-4844
Direct Wires to

News

Preceding Quarters

small rise

—

inc.
PL, N. Y

economic policies.

The most

in the gross national product.
In
the third quarter there will be a

;

46
44

Funds

Mackie,

HA 2-9000 40 Exchange

And the recession shows :

The National

business

Suiphur

Singer, Bean
&

Washington Ahead of the News—Carlisle Bargeron_—_ 14

Mutual

Production in the First Quar¬
ter of 1958
and in the Two

plant and equipment and a possi¬
ble drop in net foreign'investment.

IntT

Texas

take steps

Gulf Interstate Gas

Public

than offset the moderate

From

II.

Indications of Current Business Activity

by which the government devel¬
ops

Einzig: "A New Method of Disinflation"

speed up the cumbersome process ;

I In the second quarter of 1958
drop in the rate of inventory
liquidation, slowly rising govern¬
ment expenditures, and steady ex¬
penditures on total consumption

i___ 24
^

Dealer-Broker Investment Recommendations-—-

Pacific Uranium

——Cover

need

the need of administrative changes
in
the
Federal
Government
to

(Editorial)————-

Coming Events in the Investment Field

of the automobile industry on the

mortgages to easier credit.

Business Man's Bookshelf

to'
the unstabilizing influence r

economy.

Sec

Corp.

San Jacinto Pet

Bank and Insurance Stocks

V ;
the

shows

Teletype: SU 158

pre- *

in the future.
recession

pro¬

will

The

portion of their incomes that they
are spending for
gogds. Housing
is holding up satisfactorily in spite
of the recession and in spite of
the tardy response of interest rates
on

|than the

of these cutbacks and how

similar

been

recession, have increased the

It cannot be sat-

isfactorily ascribed to

With the recession, cannot be ex¬

1160

—

much

HEnderson 4-8504

Exchange PL, Salt Lake City

Regular Features

1959 and 1960, which
partly a cause of the recession
and partly; a result of it, is not

DAvis 8-8786

City Stock Exch•

Teletype: JCY

___

Market Study on Canada Issued by J. Walter
Thompson Co.__

for ;

business in

Lake

Spokane Stock Exchange

DIgby 4-4970

7 7

can pre-

strong unions from pushing;
up wages.:v>'
7,77"",;'7 v\The cutback in plant and equip- •'

inconceivable

•

small

Outlook

Clark

—Roger W. Babson

;

vent

unemployment

Sunday Selling Means Spiritual Losses for Material Gains

Federal,;

Salt

Current Recession and the Economic

—Colin

(3)

Members

1
The

move¬

and

J.F.ReilIy&Co.,Inc.

Temporary Success

—George G. Hagedorn

erroneous
such thing

inflation;

erroneous

additional

An Economic Program for More Than

accepted ;

should

policy; (2) the

notion that there is
as

7y
light

>'r

about inflation, ■ such as:
notion that price

Binswanger, Jr

The Search for Seecurity—H. C. Gracbner__:

erroneous

ments

the
of

—Frank G.
"

halt

to
:

movements rather than the

ex¬

pected to

tinue

steps

several -widely

(1) the

taking

recession

fallacies

may

of y

ernment

recession/

inventor i

Seiler

New Look at. the Budget—Maurice H.

business¬

among

contraction;

the

mark

covery would
be slow.
Al-

liquidation

the ^behavior

Companies' Role in Present Day

—Daniel P. Loomis

spite of tardy action
the part of the Federal Gov¬

but that the ret :

though

timidity

and

men

bearing out the state¬

are

ments made in this monthly letter
several months ago that the first

quarter

ADVANCE
f

Proposal for Federal Industrial Mortgage Program

Signs of Better Days Ahead for the Railroad
Industry

y i

Dept.

WALL STREET, NEW YORK

ASSOCIATES

Lending Field—J. Martin
A

economy to contraction more than do
American reviews of economic trends and
(2) that I con-

trust

us*

Stockholder: The Neglected Man—Donald I.
Rogers

Commercial Finance

r •f

strong resistance of the

prepared

for publication in Japanese by the
Nikon Kezai Shimbun of
Tokyo. Although American readers will
find that many of the facts are familiar, • they may find the
^analysis of the facts of interest. American readers will find (1)
"that I emphasize the limited nature
of the■ recession and the
-most

Obsolete Securities

„

The Impact of Exports:
Imports—R. L. Gray
/

overcapacity/'

;

them

Soup Stock—Ira U. Cobleigh—17

•*

YOUR 0BS0LETES!

Economy: Trends, Problems and Prospects

Slichter_—

—

.■

no general
The widely known economist wants a study
Canada's Growing Steel
Industry—D. S. Holbrook
made of reasons for plant and equipment cutbacks as well as :
f; 1
" general
deficiency of demand; believes we need to prevent '.'rr\7'- Solving the Problems of Recession and Inflation
auto industry's unstabilizing influence on the
-1.
economy; and
—Lansing P Shield—;
calls for Federal administrative
changes so as to speed up ■'
America Needs More Stockholders—Louis H.
Engel_l—_
■■*■;
:t. development
of Government economic policies.
7';7777

;

FOR OBLIVION

_TCover

torily ascribed to overcapacity because there is
;

WE NOMINATE

„

•

NMmnNMwJ

tJSU COW ANY

;

Fairless—_____
-

Sumner H.

nature; (2) reached its low quarter during 1958's, first quarter
rand will be followed by slow recovery; ,(3) cost the country
about $22 billion in lost output; and (4) "cannot be satisfac¬

The American

Period of Recession

Meeting and Conquering Challenges of Our Time

Dr. SHchter's panoramic analysis of the economy convinces
him that the recession: (1) is of a limited and concentrated

Professor

Harvard University, Cambridge, Mass.

kwmm

Page

mmmmm

Monetary Policy During
—Alfred Hayes

By SUMNER II. SLICHTER

B. S.

Articles and News

Salle

2-0813).

Bank

$40.00

Publications

and
per

Quotation Record — Monthly
year.
(Foreign Postage extra.*

Note—On account of the fluctuations In
rate, of
exchange,
remittances
foi
foreign
subscriptions and
advertisements
the

must

made

New

York

funds.

WHitehall 3-3960

Teletype NY 1-4040 & 4041
Direct

PHILADELPHIA

Wires to

SALT LAKE CITY

The Commercial and Financial Chronicle

(2392)

Campbell has been
believer

By DR. IRA V. COBLEIGH

Enterprise Economist

description of the company which produces and sells more

soup

than

any

other North American enterprise
Soup Company.

few,

Campbell

—

"brand"

any,

better

consistent

known

names

the

By A. WILFRED MAY

are

American

the

CLARIFYING OUR

housewife than "Campbell."

home.

No longer

content

will Milady be

distribute

hours

over

■

h ousewives

Quality comparable with Milady's
best products;. (B) a time

busy col¬
lecting. sou p

were

stock in

own

bones

after

which,

"home cookin'" and

costs of

suitable period of simmer¬

in
hours, not minutes;
price not too far afield from

savings

ket¬

tle—meat and

ing in water at the back of the
stove, became the basis (followed
by the addition of vegetables such
as
celery, leeks, onions, beans
and/or peas) of delectable and

real convenience in

(D)

packaging and

these

all

points,

major

Campbell has moved swiftly for¬
ward in consumer acceptance—so
much
less

that, today, for example,

than

40%

home-con¬

all

* balanced
soups.,.. So,
sumed soup is kitchen prepared.
quite topical introduc¬ Of the 60%
balance, namely soup
tion, we get to the meat of our sold
through grocers, supermar¬
selection today.
Campbell Soup
kets, and delicatessens, it is be¬
Co.—purveyor of delicious purees, lieved that
Campbell now does
as well as a soup stock of invest¬
upwards of 75% of the business.
ment quality, which 17,000 stock¬
The show case at Campbell in¬
holders have
already found to

dietetically
that

with

cludes

taste.

their

For

example, Campbell pur¬
Products,
leader in spaghetti, in 1921;
developed its name brand

chased Franco-American
a

and

with

line

of macaroni

1940,

beef gravy in 1947; and spaghetti
with mushrooms in 1951.

sauce

In 1948 V-8 Cocktail

Vegetable
facilities and
purchased from
Standard Brands; and in May 1955,
in exchange for 641,000 shares of
Campbell stock, C. A. Swanson &
Sons, leading specialist in frozen
Juice

production

trade

name

cooked

pies,

were

dinners

and

frozen

meat

acquired and absorbed.
expansion and assimila¬
consonant with a long
program of providing house¬

was
All this

tion

was

range

wives

with

kinds

canned

and

condensed soups, eight frozen ,va¬

Eighty-nine years ago, Campbell
Soup Co. started in business. By
sustained effort, sound manage¬
ments, and a program of concen¬
trating in its special field, this
distinguished enterprise has at¬
tained top rank in its industry and
is
the largest -manufacturer
of
canned soups, spaghetti, vegetable
juices, pre-cooked frozen dinners,
and frozen meat pies in both Can¬
ada and the United States. Camp¬
bell is also second in output of
canned pork and beans, and to¬
mato juice.
Most of the growth
was straight-line progress in the
company itself, but a significant
part of the expansion was due to
logical mergers.

long

"convenience"

foods.

The

trend to labor saving tech¬
niques, so pronounced in industry,
transportation and agriculture, has
been
equally
dynamic
in the

Announcing the Opening

rieties, and 14 ready to serve.
All

this

has

built

large and
known organi¬

exceedingly

well
zation, which has increased its net
with

sales

almost

monotonous

regularity in each successive year;
and recorded

rise in net earnings

the rate of roughly

6% a year.
(This is substantially in excess of
the national rates of growth in
population and in gross national
product.)
at

TV Dinners.

retain

its

eminence

and

leadership, Campbell has recently
been engaged
sion program

major

expan¬

constitute

two

his

use

education

adviser
fre¬

most

quently

expressed worries. ; Our
author wisely1 points out that the
layman's accommodation to these
twin

difficulties lies in learning
enough of the principles to enable
him to pick an adviser, and then
intelligently to appraise his activ¬
ities. *'•
J'< ■' \
' V '
f

Out author makes ah

important

in preliminarily de¬
lineating the structural differences

contribution

lion for' 1957.

of Campbell
Soup Co. has been truly remark¬

Douglas/■•'■■•r;?:.; V.;:% boom-and-bust nature of business
increase
of
overall
as¬
activity, which prompted emphasis
sistance
to
the
less
developed on timing the cycles rather than

The company has operated
profit in each year since 1898
and earned and paid dividends in

is
strongly advocated, long-term issue selection which is
\
through channels ranging from called for now.
Other relevant areas of change
enlargement of the resources of

year since 1902.
Not only
that, but Campbell has been aver¬
aging a 13% return on capital
investment, and a return of above
7% (after taxes) of net sales. This
quality and durability of earning
power is a great builder of share¬

the

;

earning

•

■}&%■*, '

every

holder

contentment.

Company capitalization couldn't
be
simpler consisting solely of
10,083,812 common shares listed on
the New York Stock Exchange and
now selling at 41
to yield, on a
$1.50 dividend rate, about 3.7%.
1957 per share net was $2.80 and
a
somewhat higher figure seems
expectable lor fiscal 1958, perhaps
$3 a share. On this basis, the stock
sells at about 14 times earnings.
Until November 1954
was

by his estate.

At that

shares
offered for public subscrip¬
1,300,000

time,
were

tion

the stock

all held either by Dr. John T.

Dorrance

393/4.

received

common

The issue

t e

was

well

and

Formerly,

fairs,

A. Wttfrc* Ma*

•

The company spends about 1%
of net sales on research, constantly

focal

the

action

vestor

was

of in¬

point
the

cyclical

Dillon,

countries

International

Monetary Fund

(Special to The Financial Chronicle)

cited embrace the

outlook in

new

corporate

management,

mendous

rise

the tre¬
corporate re¬
activities,
and
the
bi¬
Regarding Senator Monroney's search
idea
for
establishing a second partisan devotion to inflationary
World Bank, despite the stories to government policies.
to

new

American

avenues

private investment.

the

contrary there is no "shift"
in the Administration's stand from
that

last

since

pursued

the

Accent
Foremost in

Senator

February

introduced
his
for an affiliated
Development Asso¬

the

our

International

growth

Further study, not "en¬
dorsement," still marks the limit
of the Department's interest.
ciation.

The need

has been stressed

for

making it certain that Senator
Monroney's project be not con¬
ceived

substitute

for

the

existing Development Loan Fund.
It
should
be realized
by the
Congress that' the use of local
currencies, as contemplated by the
Senator, should not supplant the
employment of dollars and other

This

contribution

(N.
the

Y.,

head

"Growth"

investing procedure

present
is

author

resolution calling

by
Jeremy
C.
Jenks
Harper, 146 pp., $3.50).

With Merrill Lynch

turer.

effects investment-wise.

practical

o r

power

able.

stocks.

advocated

concentration

era

The

general and
specific attractions are explored at
length, including a full chapter on

"The Hullabaloo about Dividends."
The latter contains the conclusion

that

dividend

considerations

should be given

the least, not the
most, weight by those desiring tb
select
outstanding
stocks;
that
those giving them the least con¬
sideration usually end up getting
the largest return; that the best
long-term dividend results will
from

come

progressive companies

with low instead of high yields at
time of purchase. Perhaps some

oversimplification here; but the
viewpoint is stimulating.
An
importantly needed quali¬
fication

enthusiasm

uncritical

for earnings plough-backs

for

sup¬

growth, or at least expan¬
sion, is cited. Earnings are some¬
posed

times required for retention in

business

without

the
contributing to

any increase in the value of the
stockholder's shares. This occurs in
the

cases

of such expenditures be¬

"defensively," as
in supply¬
ing non-profitable services includ¬
ing air-conditioning. The setting
up of such expenditures as a capi¬
tal asset, with funds that have
been subjected to income tax, if
not
actually unfair, is at least
misleading.
ing

prompted

when retailers compete

GREENSBORO, N. C.—Forrest
of
a
San
Francisco investment
recipes, E. Heacoek has become connected
firm, which caters to a compara¬
formulas and products, but delving with Merrill
Attempts to Time Growth
Lynch, Pierce, Fentively small clientele, is in the
into improvement in agricultural ner &
Smith, 120 North Greene
Curiously, in the growth stock
vein of "Don't" rather than "Do"
methods, better packaging, han¬ Street.
area the author gets inconsistent
or
"How To." For example, he
dling and transportation.
with his own sound anti-timing
specifies
ten
important Dont's strictures.
"Buying points" are
Commonwealth Sees. Adds which explode popular fallacies
suggested, to coincide with tem¬
held by some of the expert as well
(Special to The Financial Chronicle)
porary periods of corporate mis¬
as a large part of the lay investing
of a
COLUMBUS, Ohio —Frederick
management or periods of indi¬
testing

not

only

new

......

Potter has

been added

Engler

(Special to The Financial Chronicle)

COLUMBUS,

Vice-President & Manager

the

Corp., 150 East Broad Street.

Joins Samuel &

SITZENSTATTER

staff of Commonwealth Securities

Russi

& Engler

now

Ohio—Rodger E.
with

The

Samuel

Company, 16 East Broad

Street.

community.

gestion of an expansion program.
But, far from confining himself Actually, the quite evident diffi¬
a
debunking operation and a culties in the way of such recog¬
highly useful depiction of preva¬ nition together with the attending
lent
psychological
foibles,
the
complexities implied by the
author lays down some affirma¬
tive basic tenets which cannot get author's rules, would seem to sub¬
to

too much emphasis.

Company, Inc.

First National Bank Bldg,

Riverside 1-6439

Dallas 1, Texas

TWX: DL 766

One is the in-

dispensability of patience, in lieu
of market timing efforts, for the
securing of worthwhile profits ("It
is

technical

choice

the

A f

S t

Economic

SOUTHWESTERN ISSUES

layman, how he shall

detailed

and

between the present markets and
those of a generation ago, with the

accepted as an en¬
hard currencies—with the Inter¬
trenched
equity
of
investment
national Development Fund to be
caliber. It is noteworthy for mar¬
recognized as of prior importance.
ket stability having ranged be¬
It
is
understood
revised
that
the 12 months ending July 31, this
tween a low of 32J/2 and a high of
Monroney proposals will go along
year.
The main Camden, N. J.
44% in the three and a half years
to the extent of using some hard
plant has been completely re¬
during which it has been publicly
currencies.
habilitated; a new ultra-modern held and
actively traded.
plant
at
Napoleon,
Ohio,
was
CPB makes no dazzling appeal
completed last year,
and
new
to the speculative buyer.
To the
"UNCOMMON
plants are nearing completion in
more conservative investor for in¬
Manitoba, Canada and in KingsINVESTING POINTERS"
come, however, this issue offers
Linn, England.
excellent defensive qualities cou¬
Important clarification and real¬
Campbejd is a prodigious con¬ pled with a steady underlying
ism about investing, with high¬
sumer of tin cans, and to fill its
trend of long-term growth which
lighting
of
the
difficulties,
is
needs it manufactures its own tin
should find reflection in higher
brought home to the expert and
cans
in the
United States
(but dividends later on.
Bpth the soup
layman in a new book, Common
buys them for Canadian opera¬
and the stock are of high quality.
Stocks and Uncommon Profits, by
tions).
Campbell is believed to
Philip A. Fisher, with a foreword
Be the third largest can manufac¬

Specializing in

Shumate

his

$455 million against $440.85 mil¬

To the

Deputy Under
Secretary of

stand by s,

involving $29 mil¬
lion in the fiscal year ended July
31, 1957, and $20 million more in

TRADING DEPARTMENT

NORMAN

"the

These, added to the
are
expected
to
propel Campbell sales to a hew
high this year — possibly above
old

The

preparation.
On

wrong-ness

Position of the Layman,

stress

for

hover

usual

crowd."

FOREIGN AID POLICY

Campbell has never been one to
price volatility. It aims to
In view of the public's confusion
each of its products at
currently exhibited over the Ad¬
logical investor-slanted reference an oven while bread or cake is one standard price and has pre¬ ministration's current position re¬
to a truly distinguished soup man¬ baking; or to assemble and pre¬ ferred to accent quality of, and
garding
international
economic
pare a welter of ingredients for preference for, its products rather
ufacturer, but
assistance
draws consid¬
soup, stew or meat pies; especially than to woo buyers by gimmicks, procedure,
when all this time and labor can
erably on a
special offers, etc. Intensive and including the
be short-cut with canned or frozen thorough distribution is achieved
very old culi"Monroney
or
pre-cooked items. And rela¬ through 8,500 major customers— P1 a
nary phrase.
n,"
w e
tively few households can afford wholesalers, chain stores, institu¬ summarize the
For, decades
before Camp¬
(or find) satisfactory kitchen help, tional and industrial .buyers—but
present - "net"
bell Soup be¬
/i, Mlady
still has her kitchen no direct sales to retail stores. "
attitude,
as
came a houseWithin the past year, three new disclosed to us
standards, so that; these "con¬
hold word,
venience"
items, ; however time soups have been introduced and in a special
European and
and energy saving, must be accept¬ there have been some changes and i n ter vi
ew
American
able on at least four counts: (A) additions in the Swanson line of with
the

Today's title is a quite descrip¬
one.
It not only represents a

tive

Thursday, May 29, 1958

advertising.
Starting
with cards in 1899, it has advanced
its ad budget steadily.
It spent
$13 million in fiscal 1956, $17 mil¬
lion in fiscal 1957 and will spend
even more this year.
As a result

Soup Stock
A

often

easier to

tell

what

will

stantiate

his

overall

anti-timing

philosophy.
In any

event, the volume's

con¬

clusions end "right on the beam"!

ert C. Koplin is now with Mutual
Fund Associates Incorporated, 506

happen to the price of a stock than "Knowing the rules and under¬
how much time will elapse before standing the common mistakes will
it happens."). Another basic prin¬
do nothing to help those who do
ciple urged is the sticking to one's
not have some degree of patience
own sound principles with recog¬
nition of the inherently deceptive and self-discipline
in the stock

Montgomery Street.

nature

With Mutual Fund Assoc.
(Special to The Financial Chronicle)

SAN

FRANCISCO, Calif.—Rob¬

...

the stock

market

and

market

good nervous system is

Volume

even

187

Number 5746

important than

The Commercial and Financial Chronicle

(2393)

goocl

head."

P.S.:—This
subtitle

volume's

inscribed

Common

Stocks

title

the

and

made

typical

Electric Output

Uncommon

stock

;of.. the

State of Trade
and

current

Retail

President, Armco Steel Corporation, Middletown, Ohio

Trade

Food

Price Index -J

Steel industrialist declares "our inflated labor

„\Auto Production

Industry

practice of using slogans, however
inaccurate, to accomplish the

Commodity Price Index

marketis

growing

By R. L. GRAY*

Carloadings

;

the

ThelmpactofExpoits-Impoits

Steel Production

The

jacket.

Profits. Tested. Successful, uncon¬
ventional advice on how
big money
is

/pushing

Business Failures

•*

the

popular radio
programs
the; other
night, we
heard the interview-ee
publicly
give voice to a widespread im¬
pression that the populace is still

gap is a

:the

little

volume

surance

Hallmark

pages newly
Home Life In¬

Company of New York:—»

1'Life Insurance
of

Property

Personal

Progress,"

Merryle

are
to educate the public
to the intrinsic
property values
of life
insurance, as well as to

syndicated economic-columnist for
the Hearst newspapers and Inter¬
national News Service.
Mr. Ru¬

Steel

the

over

structor of

been

years

Barring

in¬

readable

cinctly

describes

the

and

from

Life

property
Mr.

life

benefits

it.

and

under¬

the booklet
to

modern

only

but

also

says

income.

the

time,

provides
assurance

says;

needed
against

reserve
a

Canadian

mathe¬
'

major

person's

the

life

contract

may:

;

fence

company

of. my

penny

when,

support came,;
from the land.
were

t
r

in;
days'

DemoThe

s.
m

needed to

stitute

R. L.

the Democrats
were

meeting of this In¬

one

the

patriarchs

industry greeted him by say¬
ing, "Charlie, you folks certainly

Gray

have

the

champions

and

of our

a n

.announced

On Monday morning, Mr. Hook

walked into

ex-

their

products

company

to build a' steel

proudly that we were going
plant at Houston,
Texas. All of us, including Charles
R
Hook, then President of our
company,, felt we were doing a
great thing in bringing the steel
industry to the great Southwest.
That was .on Friday.
very

and;

port

of free trade.

lot of guts to start a steel

plant in the

On the

the

other

hand

the

■

those

;

in preparing this talk.

the

foreign trade question, J My second qualification comes
Until graduation from
college, from a rather disconcerting ex¬
I was a "free perience with the
problem of
trader." Every
dumping./This dates back to 1941,

were

world!"

dumping ground of
I

sure

this

ex¬

hand, the Republicans—in¬
pressed the feelings of many steel
cluding most of the steel industry
people, not. only in this country
people—were exponents of high
but throughout: the world, who
tariffs, which raised the prices the were
looking for places to dump
farmer
had
to pay for
barbed
their surplus steel, ■
' .
wire
and
agricultural
imple¬
However, J am happy to say
ments.
•

price hike.

that since

1941, most of the steel
companies-here at home have
to realize that dumping steel
for a small forging company.
I in Texas or
anywhere else, for
had to jump over the fence and
that matter, is not good business
join the Republicans as an indus¬ for
anyone — neither
the steel
trialist whose concept was that
company nor,:in the long run, the
the struggling American steel in¬
customer.-I believe the steel in¬
dustry had to be protected from
dustry. in .other countries will
imported steel.
someday reach this same conclu¬
Now, looking at the foreign sion.
trade' question from all angles—
Another of my qualifications on
and believe me, .there are a lot of
this subject has to do with the
them—I find myself right on top
importation of raw materials. To
In

1916,

tionist"

last April forced United States producers

world trade association

of these groups have had

life, I
of

in Missouri

clement of doubt in the picture.

Canadian mill still docs not favor

sides

most, farmers

the average increase will be in the neighborhood

are

of my

both

farmers,

The current improve-

seasonal letdown in July due to

been

times

My folks

can¬

follow its lead in cutting prices 2 cents a pound. Even though its
own labor costs will rise in
September, there arc indications the

matical equivalent of immortality.
In final conclusion, the author

characterizes

/:aV;;'i

Aluminum producers feel they are in no position to absorb
higher wage costs, but when the time comes they will have
to keep one eye on a large Canadian mill which has been shipping
large tonnages of ingot aluminum into the United States. This

psychical
the owner

human obsolescence and

• •

the

unmeasurable

with ;

uniooked for change in the wage-price outlook,

factors have injected

owner

sound financial return

This trade authority speculates this week on the outlook for
aluminum prices. Wage costs of domestic aluminum producers are
scheduled to rise 15 to 20 cents an hour on
Aug.-T, but competitive

estate

form,

of $6 per ton.

derived

Rukeyser, offering the

not

But chances

suc¬

insurance

various

have

steel prices will almost certainly rise on July
1, "The Iron Age"
predicts. This is because mill employment costs will go up about
20 cents an hour under contracts with the United Steel Workers.
Some mills are thinking in terms ot a price rise of $10 or liibrc.

easily

c r a

1959.

steel,; and/adopt a reasonable, flexible tariff
until gap between domestic and
foreign costs is

J
r

have told "The Iron Age,'' they look-for: a f
£
improvement in the last quarter and an even:
the first quarter of

narrowed.

court

by
metalworking plant vacations.

and editorial writer for the Hearst

standable terms,

mcht may be short-circuited

journalism atColumbia,

newspapers.

V";.-:'

stop costly wasteful and inefficient labor prac¬

adopt

structure

Now they must buy if they intend to

.;.V;

our.

in the field of

leaders

market

better market in

Sense

beginning to think that May might

free trade basis.'' In citing weaknesses

Anti-Dumping Act of 1921* establish

Money and Investments," and

has

are

build-out programs.
'■

definite

keyser is also author of "Finan¬
cial
Security
in
a
Changing

i-..v

ruling involving the mechanics
of setting oil and gas rates. An
appeal is now pending before the
United Slates Supreme Court, but the word is that the
pipeline
firms will not wait for a filial ruling.
Two or three major linepipe orders are expected to hit the mills in the near future.

Expect treatment, in lieu of a
house promotion, is given
by this
writer,
the
veteran
nationally

in Detroit

salesmen

celled out orders because of

World," and "The Common

magazine. notes indications that pipeline companies
be coming back into the steel market soon. These firms had

The

derived

*/■,.

r-?"?

buiid."

help clients understand the values
-

its second best of the year.

rapidly

middle-ground approach between the exsolve our foreign
trade problem. Suggests we liberalize trade
policies a» a longrange goal, encourage higher standard of
living abroad, utilize

reported' that last ''

company

are

tremes of free trade and
protectionism in

'■

•

Continuing, this trade journal says, there has been an influx
of new business from relatively small customers, such as stampers,
appliance parts -makers and automotive parts makers.. Some steel

■

their

satisfactions

One

weekly adds that there is a growing feeling that
the auto companies are scraping the bottom of the barrel on inventories. "Auto companies have gotten themselves into a
spot,"
asserts one steel man. "They've held off some of their orders for

tives

and

weeks.

This trade

Stanley Rukeyser. "
As indicated by the
title, the
insurance company's chief objec¬

therefrom.

was

four

urges we

tices and

/their best month since January. This sentiment is based
largely
r on business from non-automotive
buyers.

The

—

last three

week
-<
*

published by the

Gray

people, it points out, feel that the bottom of the
recession has been reached. While keeping their
fingers crossed,
they point out that order volume has kept on an even keel during

both

under-insured and : undereducated about the subject. Serv¬
iceable in filling such a

Most steel

costs

cost of production, and the dangers
of going too far either
way in our foreign trade policy, Mr.1

the steel

industry this week steel men are feeling more
optimistic about their market outlook than they have in some
.months, "The Iron Age,".national'metalworking weekly revealed
on Wednesday last.
"
1
' ; "

PRO INSURANCE
one

have to compete on
said to be found in

On-

to the point where

will be priced out of the
market-—not only abroad but here at home too—if we should

"hard sell,"
.

became

when

started

"protec¬

work

come

tool

for

the

adjustment

practical

The employment situation in the week ended

to I reality.

May 10, shows
drawing unem-V;

tlic

biggest decline in the number of workers
ployment payments in nearly two-years, a report from the United '?/ of the fence and cannot lean very sweeten; our blast furnace burden
States Department of Labor reveals."
'
:
; at Houston; we arranged to bring
;
•
./ ?. "r
\:-y. far one way or the other.
individual builds a bridge—
;
;; The agency states the total dropped by 93,308 to 3,101 ;516, the / ;
Within my own company, some in iron ore. from Mexico."- While
through the insurance contract—
take the position that we should this
largest decline since August, 1956, when the total fell by 100,000.
arrangement has worked out
from the present to the somewhat
.-.-All but four states—Alabama, Connecticut, West Virginia and ' have" unrestricted
international very. satisfactorily, there were a
unpredictable future."
trade in steel, while others are lot of headaches at first.
Delaware—shared in the decrease, the? department sayfc.v / •'
Conse¬
While not concerning itself with
equally convinced that high tariffs quently,! had a.first-hand insight
However, the rate- at which -unemployed workers are using up
and trade
restrictions offer the into the difficulty of importing
pitfalls such as over-insurance; r their compensation
payments continued to rise, according to the
only realistic solution to our prob¬ foreign raw materials before it
needless
department. In the week ended May 17, benefit exhaustions went
insurance, or miscon¬
lem.
You can be sure that both became a national problem.
up by 1,400 to 26,500 in the eight large states which report weekly
;
<
ception about investment attrib¬
Now that you are all convinced
to the agency.
It does not collect national benefit exhaustion
r'*An address by Mr. Gray before the
utes, this little volume is valuable
I am no more of an .expert on
66th General Meetinj of American Iron
figures.
■
•.
:
'
r>
' /'•* '' "
Instead of fretting over the
ways
pf nature and man, the prudent

.■

•

for

the

concise

observations

content

made

basic

available

for

New claims for payments in the week ended May 17 declined
by 49,410 from the week before to 359,236—the first time since *

client and prospect.

Continued

page

and

22,

Steel Institute,

New York City, May

1958.

Continued

page

Harry J. Steele and J. Barr Haines
m

announce

the formation of

Economist-PH.D.

arc

pleased to

HERBERT J.

Decade of experience in uni¬

STEELE, HAINES & CO.
1812 First National Bank

Building

Pittsburgh 22, Pennsylvania
successor

the securities

ri5 now

versity

teaching,

short

us as

registered representative

Members New Jork Stock Exchaiuje

Co.

and Other Principal Exchanges

529

and

Financial

209

South LaSalle Street

New York 7, N. Y.

•

Chicago 4, Illinois

Telephone DEarborn 2-0500

Chronicle

June 2, 1958

associated with

Cruttenden, Podesta
Box

Fauset, Steele & Co.

(Joe) BURKE

notice.

firm of
Commercial

that

financial

journalism and industry.

Available

announce

NEW YORK
OMAHA

DENVER

GRAND RAPIDS

LINCOLN

MADISON

ST. LOUIS

INDIANAPOLIS

CEDAR RAPIDS

ST. PAUL

MILWAUKEE
FORT WAYNB

The Commercial and Financial Chronicle

(2394)

."Thursday, May 29, 195Sv

triggered

by heavy immigration
rising standard of living. IV;
quote a lot of statistics,
but it is significant to say that all ",'
of these growth factors have been;
proportionately greater than those V
and

Canada's Growing Steel Industry
By D. S. HOLBROOK*

Alffoma Steel Corporation, Ltd.
Marie, Ontario, Canada

President,

Ste.

Sault

Canadian
in

ment

which he

found in his country

iron and steel industry, as

that the Canadian

doubled its ingot capacity
in the past

ment

years,

and

the

and

strict

very

iron

modernize

the

By LANSING P. SHIELD

controls

This

be-

plants

and

the White House.

ex-

recipient; of :"Grocery Ma n-of-the-Year", iiward

wage-price spiral, and calls for

antirecession combined meeting of business and labor leaders at

pand to meet the needs of industry ;

year's

decries

the
industry >;

steel

•

; President, The Grand Union Company, East Paterson, N. J.,

;

encourage

and

its

Recession aid Inflation

same

which, j during
postwar period, had

anxious

Canadian

than tripled its invest¬

war

came

result, has

States

Government

imposed

are

Mr. Holbrook observes

favorable than those found here.

with and finds

compares

United

period.

executive

Solving the Problems

not

the

attributes the very real improve¬
Canadian steel affairs to the depreciation tax laws
steel

will

the

in the

Mr. Shield states

that,

emergency

even

■

? ;

turn

we soon

;

we still must solve the major probshortage.
.T-'-jx
: lem
threatening our economy—i. e., wage-price race—and
On Jan.
1, 1949 the Canadian
Government replaced straight line v- .?>. suggests business and labor be asked to
pledge resistance to
depreciation regulations with
a a
fnrthet wage-price increases
corner

in times of steel

and refers to excellent long-term

recession,

growth prospects and prediction thai steel ingot capacity will
double in the next 20 years.
The time has

when

Canada

nation

long since passed
a

of Eski¬
Englishmen who

made

Indians,

mos, :

considered

was

mostly

didn't know how cold it

and

was

the

•

much

modern
know it today, can

development

the

industry, as we
best be summarized in three
riods:

pe¬

accelerated

buttered

has

between
States.

continuing

bread

In recent years,

on.

been

throw

their

Atlantic

the

and

light

Canada
There

the

and

United

been

have

Until

there

effort

relationships

Pre-1939

was

many

start

the

World War in

steel

the

demands and in

Second

able

1939, the prosperity
industry

Canada

spotty. In the early
great demand for rails

the

Now

will

all

our

respect

industry

have

reason

for

its

ac-

our

relatively favor-,

depreciation

tax

%, V

;

•

and

allowance

o u r

suit

have

Domestic

wimL

Economy

iMllv

*
A£ter » aecadeyof prosperity,
is not good. During the

-business

clp^dl^ ^sS
a

fs
in
of
current
1n™d ^ excess of current
it

/jp|'

fundamental

Examines

First, what is really happening
t0 our 'domestic economy?
J11BV

last 10 years, we, as a nation, have

vival, we are '
dependent
upon certain

atmosphere,
the
Canadian >iron
and steel industry has expanded
so that by the end of this
year it

had been very

1900's

for

to work together

agree

to fight the recession.

^ ex»an- complements but we food people
such ", heavy
prosperity"1 8 V?CU°^ F°r

recognition

amortization

system and, in 1951, greatly
encouraged growth by providing

Frenchmen who knew which side
of

and, also,

realistic declining bal¬

ance

1949 and

pre-1939, 1939 to
1949 to the present.

excess

now

added some three mil- economic and
speeches made with the intention for building Canadian transcon¬
*.drawn miliions;"of workers into
lion
tons
annual
ingot capacity social changes
paving the way for a clearer, tinental railroads furnished much
the dabor force" Now we have a
since
1949, doubling its size in 10 that are reunderstanding between the two of the stimulus for industry, and
nations. I have no such lofty con-, this was followed by the boom
shaping our.
and 5,120,000 idle workers. You
The growth of the United States national,'a n d
•
tribution and wish to speak only and resulting steel expansion of
aPd I
wondering what our cus^
about the iron and steel industry. World War I. By 1920, Canadian industry in the same period makes international <
fo?
a
three-million-ton increase
I wish to make a report on the ingot capacity
had reached two
lool^of life. It •
money,-need to know what reason
million
tons
per
year
but with small by comparison but,
progress of our industry in Can¬
the is
significant
sMam- is'there to believe
of

tomerkC SSIe

disproportionate financial strength Canadian industry, this has been that more than
the producers. Much of the a fiiant stride. I will not detail <75 ?0 of * the
money earned during the World here the new installations which
news
on
the
^ Lan«»g P. Sh.eld
try has doubled its ingot capacity War I years had been spent on have been made but the growth ft ont page of
^
.
has been much more significant yesterday s
and more than trebled its invest¬ plant for which there was no use,
New York Times
ment in the last 10 years, I would following the war, and the indus¬ than the measure of increase In -(and \ the same
is
true of any
tike to make some observations on try was over expanded.
All ingot capacity alone would in- other morning) is devoted to two
one factor which has contributed
through the 1920's the average dicate. The growth has been deep subjects; first, the state of our
and x second,
largely to the development of the rate of operation in Canada was and sound and not accomplished domestic-economy
additions
to
industry — favorable depreciation only 50% of capacity and profits' solely by
melting what is happening to the people
were not widespread.
tax regulations.
Canada
As a result, capacity. I believe that "Canada is who live outside the borders of
I have elected to discuss depre¬ the
country
in
Depression, starting in the the only
the, noii- the United States.
ciation because I believe it is a
'
early 1930's, necessitated extensive Communist world where increase
-J
'
in ingot capacity has been accom- V
Problems Still Tlie. Same
Critically ' important
issue
with financial reorganization of several
of the companies.
panied by proportionate increaseThe other day I sent over for a
you, and that our Government in
particularly with respect to
growth and develop¬
ment. And then, since our indus¬
ada,
its

recent

among

has

Canada

shown

better

under¬

The

most

standing of the problem than has
yours.
I further believe that we

Canada

its

must

management

promote

Clear knowledge of the importance
of the depreciation problem, since
it affects all of
It is not

the

us.

•.

academic thing. It's

the

between

the

did

not

capacity

piece that Julian Kennedy

seum

installed in 1903, and it's the

why there

son

comotives

are

rea¬

still steam lo¬

chugging around

few

of the mills.

a blast furnace operator had
5,000-pound coke rate, or an
open hearth operator was getting
a

tons

hour from his modern

furnaces; he wouldn't be around
long enough to worry about it.
And yet this is the kind of

per¬

formance which is taking place

appreciably

'Eighty
last

With few exceptions, the advent
of World War II in 1939 found the

added

the

capacity
only

two

between

and

the

and

add

and

coke

capacity.
ovens

the

Blast furnaces

gregate capacity of 5,375,000 ingot
tons per ;year; the largest with a
capacity of a little more than two
and a quarter million tons and the
-smallest absut

,is also
and

900,000 tons. There
large alloy steel company

dozen

smaller mills

melting

scrap in small furnaces or
rerolling purchased steel. All to¬
gether, ingot capacity amounts to

installed and the industry gained
some
semblance
of
its
present
form. •
Durine the

decade

war

from

and

1939

in fart

M49

Canadian steel industrv

was

tho

! the

badlv

comanies, and does not specifically
consider the
alloy and rerolling

1949-Present

ing ; their
that

than

neglect¬
it is just

way

importance;

their

special

experience
the

industry's

whole.

Although the Caandian steel in¬
dustry is more than 70 years old,
♦An
the

address

66th

Iron

and

May

22,

Mr. Holbrook before
Meeting of American
Steel
Institute, New York City.
1958.
'
General

>DelavsFarm

the

last

Coerce
_

Germans

.on

Arms. ;

;

shake

1958

off

this

this tremendous

use

capadty an(J at the same time find
.jobs
for
millions
of
workers,
.

of whom helped build this
;
; •/,
' x".
-

maily

plarR

Khan]c*

i.'kP

Automatic

and

how

know

'negotiated

raises in wages in union contracts

adding to costs without respect:to
productivity and thus increasing
prices, a balance can be restored
without

resorting

further

'^So^rloila^

powei oi .9111 .aoiiar._ .^

The really grave questiojn.bef°re; the country today is whether

whereases in wages will ^.continue

{iviW

abouyt'hear

&&&

our domestic economy. SJXJX V

Already American industry is in
danger of pricing, itself ;out of
domestic -and

the

Arms

•;

inter*

national market places. This spiral
is undermining not only our shortanc* long-term prosperity, but our
economic and; social systems to a

f v;: • Jffi) Plaiy^to^Sa^ C^id"standard Point where we may be easy prey
primary;«Ready.in France. : ^
;;/»■
for our enemies.
.•. \
J

,Almost

the

we1 faced

identical

problems

has

kept

with

the

„

with

ago * are

years

has

made

allx

nations*,

inter-

dependent has1 now put us within
18 minutes of Moscow. by way of

mills built in the last ten
years.,;
For the most part technology

the

United

intercontinental ballistic mis-

increases

yGa1'*

out^

wages

stripped increases in j-output per
plan hour by .4%. Then in 1957#
inflation really, got under

way-^--

(although, vfortunately - no wages; increased:-SA% and pro*
States. Raw material beneficiatiori-regularly scheduled flights have ductivity advancedjonly 1.6%. By
and 'blast' furnace -practice is yet been announced).- '
the end of last year, the dollar
!sound; open hearth production .is v* Our -domestic economy is be- yen earned or saved tin 1946 was

will

period stood at about three million

This is in

seven

•

recession and

will

apace

sile

lacking free enterprise; construe- ^etter than ,av^raSe and a new coming increasingly dependent on worth only 67<^ Unless the wage*
^oxygen steel plant, the firstbin* neighbors for its survival and Pr^Ge spiral^ is checked,vIO years
tion, production, prices, profits
North America, pioneered in 'thiss
prosperity. If the finest food dis- from now your dollar literally will
and. most critical phases of the
field.
By the end of this year, tribution systerri on earth is being n°t be worth 30£-r
business were closely
regulated.
20% of Canada's steel capacity built on a foundation that
Steel capacity at the end of this
may be
wa«r^nirai

about 6,000,000 tons per year. This
report discusses the experience of
the integrated basic iron and steel

mills.

furnaces

built, and
ingot capacity was
in¬
by approximately a mil¬
lion tons during the war. Bloom¬ progress with almost all the highly
ing and heavy plate capacity was finished steel forms produced on
were

creased

The Canadian steel industry of
today principally consists of four
integrated companies with an ag¬

Roosevei't

;

annual

The Industry-

economy

During these., last 10a-,years of
unparalleled prosperity, the standstill, but now ..they; are even1 arcl
living in thisi country has
production in the last 18 months rriore! urgent? and
pressing:
The steadily,--'. mounted. ...:Gutput^ per
and a third is scheduled for the;
wage-price- spiral, for example, man hour, has increased 23 %xand
year-end.
At least 75%
of the wasv then a
minor'"worry.
Our ?eal hourly earnings 31%. This
hot rolled steel was produced,
on.x'foreign trade balance a quarter of
a .dangerousctrend because, on
mills new or completely rebuilt a
century ago was expanding, not H16 average, wages moved ahead
since the mid-fortiosf Cold.rolled,
declining,:and the oceans made
productivity by less than 1%
steels, galvanized sheets and tin- America xan almost ; impregnable Per year. Then, in 1956, there was
plate have made the same rapid fortress. The shrinking-world that an alarming change; In a singly

United States, to rehabilitate plant

accountant's problem.

last

RiiflS^Up-

turn in Business
"•
/4 y..

development of
rolling and finishing capacity has.
been, very impressive.
Two new.
blooming mills have gone into

con¬

ness and is accepted
by too many
people in the industry as only an

the

The

wars

and

seven years.

encouraged by the Government in
manner

tHejl?**

•

same

built

from

companies
had
built
rolling mills. A very strong effort
was made
by the steel companies;
the

^EHeserve^

<*>

Parley at
Geneva
VDelays Debate.
7
Fifty percent of the ingots earned ; (6)7" French See No:' Way to

of the open hearth

of then modern

was

struction

whsVx

blast'lUr.J-A^^

produced from

naces

capacity
20 years';

built

ovens

National Recovery Bill be-

> (X)

years,

blast furnace

less than 10%

was

prepared for the emergency. There

much

wouldn't every; one fit today?

Forty percent of the hot metal

Canadian
steel
industry
with
plants poorly maintained and un¬
no

percent of the cohe

made

the "depreciation end" of the busi¬

furnace

1940

1939-1949

had been

;

tons, in this period.

superintendent

can't'get a ^neW
battery of pits to replace the mu¬

1920

from

r,„

capacity.
Basic" copy of .the "New York Times"
equipment has been'dated exactly 25 years ago. Here
brought up to date and auxiliary are some of the headlines. With a
equipment greatly improved.4;;'*; change in, name here and 'there,

that

0..„

production

This growth
can
best be exwhile,
in the United States, capacity had pressed in terms of 1957 producrisen by one-third, or 20 million

expand

why the blooming mill

reason

wars

blast

striking commentary
of the
industry in

state

that "in

our

And

trols,

1949,
excess

however,

oxygen

con¬

profits tax and steel

installa-

destroyed

4 x.

without,

are

from

within

going to

planning

lot of

provide

at lower costs for people who

modern in-

a great deal of energ^
confidence.: Im summary—iri

dustry with
and

either

trouble * in

the Canadian steel in-

so,

dustry has become

price

steel

tions.

tons annually.

So let's examine for

cessively dropped and the indus¬

the first 50 years capacity reached
two million tons; in the next ten

try

years,

and

the

been

suc¬

"on its own." The postwar
Canadian industrial
was

another million tons; and in
last ten years, an additional

boom, then
only beginning to gain impetus, three million tons!
Although Canada,
provided, Canada with a strong
and continuing steel demand. This has grown by leaps
demand

was

stimulated'

by
a
capital

tremendously expanding
investment, fast population growth

tn6 StGGl

nation,
and bounds,

•

industry is that it has

Continued

ours

and

where baseball

television

and

our

problems
serve
to
from facing up to major
our

way

of life.

An address- by Mr*-shie,d uP°n re"
the "Grocery Man-of-the-Year'

ceiving
Award

threats to

golf

divert

•

of the relative progress

measure

,^n

what is really happening to
this world of

city,

presented

May

19,

1958.

the

that

automatic

and

bu^inesfrecession^make^certain i
Dusiness recession, make
a
continuation
and

of the wage spiral—^
resulting cheapening of the

dollars

are

earn

you

likely

are

settting

rainy day. 1968 prices
to look, like these: a

suit of clothes bought in a medium

priced

store

Grocery Manu-

the

sie^~u^s ,?a.c/1 x^ea^

p;Ynrii Shoes—$40,
page

to .review

thousands of, labor contracts in
force and^
being signed to

moment

day-to-day

allocation controls had

only

^as

understand

won't be around to eat it.
<

^ne

mobile

—

—
$200, a pair at
medium-priced aute$7,000, a sirloin steak

yolume 187

Number 5746

The Commercial and Financial Chronicle

...

"bought in: a /super market—$3 a
pound. In 1968 when you check

62,000,000'/ people ^supported^ by 7pfoblem of wage-price spiral. Un¬ exists,
white

If the wages of the butcher, the
baker and the Candlestick maker

^re doubled
expect
and

the

or : tripled, you can
price of -meat, bread

kilowatts

000

theselitems. -'

We.

the

trend" accelerates, a
small segment of our community
may have the money to pay these

bigh; prices.?: As against this,

over

for/their

(Incidentally,

should-* all

although

corner

remember

may

this

••

but

balance

point

between

recon-

■

equally important, to work to^
gether as a team to lick this re¬

•

5. '

•

■

There has been

complete turn
management's
relationship to its employees since
the days when labor was pur¬

Isn't

wages

and

business,

requires

critical

The
we

labor

Attack

and

chased

basic economic

our

Isn't

the

time

government

combined

possible and

end.

For

the
in

at the

worker

danger

■»'

1;'

tit".

•*

this time

White

House
and
a
voluntary
pledge sought from them to resist

•

...

once again
he -is
becoming a tool—

tool of the unions. We

Continued

New Issue

May 2S, 1958

$100,000,000

.4.'-,..

4%, 3%%, 3%% and 3% Trunk Line Highway Bonds (Series I)
(payable Solely from Specific Amounts of Motor/Vehicle

;

Dated

!
■

Fuel and Weight Tax Allocations)

June 1, 1958
/.These Bonds'are

not

subject to redemption prior

Due

maturity.

February 1,

shown below

Principal'and semi-annual interest (February 1 and August 1, first coupon payment date February 1, 1959) payable at the Manufacturers National Bank
;
/
of Detroit, Detroit, Michigan, The Chase M anhattan Bank, New York, New York, or a.t The First National Bank of Chicago,
;
Chicago, Illinois, Coupon bonds in the denomination of 51,000,, registera.ble as to principal only.
.

iInterest exempt, in the opinion of Bond Counsel,

from Federal Income Taxes
under existing Statutes, Regulations and Court Decisions

Exempt from

and all taxation in the State of Michigan

any

■/

■

••

■-

-fl

■

-v-

THESE BONDS

aref

•

"
*

d' :

/7<
u

Authority within the State

or any

....

■

-9

•

"■
*

'
'i •
•

'•

•'

•

issued in accordance with the

provisions of Act 51, Public Acts of Michigan, 1951, as amended, and pursuant to a
the State Administrative Board of the State of Michigan, for the purpose of providing funds for the construction of
State Trunk Line Highway System. These Bonds are not general obligations of the State of Michigan, but are payable
solely from moneys appropriated by the provisions of said Act 51, Public Acts of Michigan, 1951, as amended, to the State Highway
Department from the Motor Vehicle Highway Fund, being a separate fund in the State Treasury consisting of the proceeds of taxes levied
pursuant to law on gasoline and motor fuels, and on motor vehicles registered in the state, and a sufficient amount of said funds have been
irrevocably appropriated by law, and resolution of the State Administrative Board adopted pursuant thereto, to pay the principal of and
interest on said bonds as they, mature...
.
•
5
;•
resolution adopted by
certain portions of the

;

f
.fy

AMOUNTS, COUPON RATES, MATURITIES AND PRICES

Coupon

Yield

Coupon

$2,905,000

1959

2,990,000

1960

3,080,000

1961

3,175,000

4
4

1963

3,465,000

3,575,000

Due

$3,685,000

Rate

1967

Price

Rate

Amount

2.70%

$4,665,000

Due

1975

3«/4%

3,795,000

1968

2.80

4,805,000

31/4

1976

3,905,000

1969

2.90

4,950,000

31/4-

1977

2.00

4,025,000

1970

100

5,100,000

3V4

•2.20

4,145,000

31/4

1971

3.05

5,250,000

;

r,L '

1.70

Price

100
100

3.30%

1978
1

3.35

1979

3.40

2.35

4,270,000

31/4

1972

3.10

5,410,000

1980

3.40

2.50

4,395,000

31/4

1973

3.15

5,570,000

3%'

1981

3.40

2.60

4,530,000

31/4

1974

3.20

5,570,000

1982

3.40

1966

<
4

-* v

(Accrued interest to be added)

These bonds
'

Ahiount

1965

/•

■

/.v

1.35

1964

3,470,000

-1.00%

1962

3,270,000

;

Yield

I)»e.j,

Yield

Coupon

Rate

Amount

are offered when, as and if issued and received by us,rsubject to prior sale and the approval of legality
by Messrs. Miller, Canfield, Paddock and Stone,
Detroit, Michigan, bond attorneys'. This is not an offer to sell these securities; said offering is made only by means of the official statement, copies of
I
which may be obtained .from such of the undersigned and other underwriters as
may lawfully offer these securities in such State.
i
••
y
...
v
.

Blyth & Co., Inc.

Smith, Barney & Co.
.v

C. J. Devine & Co.

Lehman Brothers

Ilalsey, Stuart & Co. Inc.

Phelps, Fenn & Co.
*9

Salomon Bros. & Hutzler

■

Ilarriman Ripley & Co.

Equitable Securities Corporation

Shields & Company

••

White, Weld & Co.

First of Michigan Corporation

Incorporated

Eastman Dillon, Union Securities & Co.

Kidder, Peabody & Co.

Drexel & Co.

...

Glore, Forgan & Co.

Ladenburg, Thalmann & Co.

Goldman, Sachs & Co.

Merrill Lynch, Pierce, Fenner & Smith

■

John Nuveen & Co.

R. W. Pressprich & Co.
,

■

Stone & Webster Securities Corporation

(Incorporated).

B. J. Van

Ingen & Co. Inc. *

;

■

A. C.

Paine, Webber, Jackson & Curtis

I ncorporated

Lee

Carl M. Loeb, Rhoades & Co.

Blair & Co.
Incorporated

Braun, Bosworth & Co.
~

A. G. Becker & Co.
Incorporated

Horn blower & Weeks

Bear, Stearns & Co.

Allyn and Company

Higginson Corporation
Reynolds & Co.

Alex. Brown & Sons

Estabrook & Co.

Ira

llaupt & Co.

Incorporated

Hemphill, Noyes & Co.

F. S. Moseley & C».
L. F. Rothschild & Co.

Baxter &

Company

F. S. Smithers & Co.
*•

J. C. Bradford & Co.

Clark, Dodge & Co.

Weeden & Co.

Dean Witter & Co.

;

Incorporated

but

-■V;
"V

was

of social reform

wave

quarter

by the unions has yielded
constantly increasing benefits for

session of business and

union leaders to be called

ridden

problems?
for

cheaply

century

attack

overdue

wheel

discarded when its usefulness

when

overdue

make

emergency

high

time

situation

Combined

The

should

find ourselves today

leadership

Wants

that

the

'*■>>

••

....

cession?
of

view

jor problem threatening our eco¬ order from business as well as
nomic ,/and social ^system , — rthe ^government. When an
emergency
■

counteract it.

are

become

not

the

in which

ma¬

takeil to

let

justment.

recession,

productivity can be restored only
through a drastic business read¬

the

shall not have solved the

this

that

turn

soon

current

ciled

enjoy will

now

Now

memory.

Russia

gets out of whack.

economy

inflationary

"and

4,500,-

signed trade agreements with
countries.) And so the whole

doubled

which

Americans, depend

livelihood'.

tripled just a little later. Prices
will go up but not "necessarily the
;

further wage-price increases and,

other down:

has

supply ' of

must

literally fighting for sur¬
vival on many fronts, the captains
of industry and of organized labor
cannot afford to be tearing each

When

measures

ternational trade

will / probably read,
anything left?" k

"Have you

emergency

collar workers and
'many less we solve it and recapture the
inillions- depending on pensions, image of America as a nation of
will be in a desperate
position. people who are willing and eager
In
the
meantime, ; too, we will to give a day's work for a day's
have ■ priced ourselves out of "in¬
./pay, the
way
of life that you

outv of 'your room in this hotel,
the /usual : sign, "Have
you
left

anything?",

(2395)

page

The Commercial and Financial

(2396)

and

Baltimore

New York

Bros.

Activity—Analysis—Francis I. du
Co., 1 Wall Street, New York 5, N. Y.

Pont &

Refunding—Discussion—New

Treasury

York

Hanseatic

EVENTS

Cor¬

poration, 120 Broadway, New York 5, N. Y.
Yields

send interested parties the

the

•

will be pleased

Air

American

following literature:

Filter

•

June 2, 1958

•

Co.—Memorandum—Doyle,

O'Connor

Banks and Trust Companies of

Business

Brief—Economic trends—Economic

Business and

Co., 160 South Main Street, Salt Lake City 1, Utah.
& Shippers Insurance Company—Report—Robert H.
Co., 210 West Seventh Street, Los Angeles 14, Calif.
Also available are reports on Camden Fire Insurance Asso¬

Maryland

Research De¬

Marine

Insurance

N. Y.

Oil

and

Gas

Corporation

—

Card memorandum

June 6, 1958

memorandum

Fuller

Banking Dept., Manufacturers Trust Company, 55
Street, New York 15, N. Y.
Inflation—Study—W. E. Button & Co., 14 Wall Street, New
York 5, N. Y. Also available is a memorandum on the Ken¬

•

low

Insurance Stock

Analyzer—Comparative figures as of Dec. 31,
1957—Blair & Co., Incorporated, 20 Broad Street, New York
5, N. Y.
,
Japanese Prospects for 1958—Analysis in current issue of "No¬
mura's Investors Beacon"—Nomura Securities Co., Ltd., 61
Broadway, New York 6, N. Y. Also in the same issue are
discussions of Series Type Investment Trusts in Japan and the
Iron and Steel Industry.

-Club.-

•

ipg

.■

Report—Harris, Upham & Co., 120 Broadway, New

Calif.)
Los

Party

available is

Goronado, Calif.

York

Manoir

June

South

(Minneapolis-St.

City

June 20, 1958 (Philadelphia, Pa.)

Investment Traders Association
of

Philadelphia summer outing
Overbrook
Country Club,
>
Radnor Township, Pa.

Hentz & Co., 72 Wall Street,

5, N. Y.
Inc.—Memorandum—K. J. Brown & Co., 118 '

Mulberry Street, Muncie, Ind.

June 24, 1958 (Detroit, Mich.)

McColl-Frontenac Oil Company Limited

— Analysis — Burns
Company Limited, 44 King Street, West, Toronto 1,
Ont., Canada.
;
Mine Safety Appliances Co.—Study—Troster, Singer & Co., 74
Trinity Place, New York 6, N. Y.
Page Hersey Tubes, Limited—Analysis—McLeod, Young, Weir
& Company, Ltd., 50 King Street, West, Toronto, Canada.
Photon Inc.—Report—May & Gannon, 140 Federal Street, Bos¬
ton 10, Mass.
■ ;
Preway Inc.—Analysis—Loewi & Co., Incorporated, 225 East
Mason Street,. Milwaukee 2, Wis. Also available are studies
of Cutler Hammer, Inc. and American Express'Company.
Texas Gulf Sulphur — Analysis — Halle & Stieglitz, 52 Wall
Street, New York 5, N. Y.
United American Life Insurance Co.
Memorandum
Lloyd
Arnold & Co., 364 North Camden Drive, Beverly Hills, Calif.
Upper Peninsula Power Company—Analysis—A. G. Becker &
Co., Incorporated, 60 Broadway, New York 4, N. Y.
Wilcox Oil—Bulletin—Bache & Co., 36 Wall Street, New York
5, N. Y. Also available is a bulletin on Raytheon Manu¬
-

19, 1958

Bond Club annual
picnic, and outing at the White
Bear Yacht Club, White Bear
Lake, Minn.

Miami Beach 39, Fla.
Turnpike—Bulletin—Tripp & Co., Inc., 40 Wall Street,

New York

Richelieu, Murray Bay,

Paul)

Korvette, Inc.—Analysis—Cady, Roberts & Company, 408

Securities Traders Association of

Bros. &

Detroit &
:

Michigan annual

mer outing at the
Golf Country Club.

■_

June 27; 1958

-V Bond

....

(Detroit, Mich.)

Club' of ^Detroit

outing
Country Club.

summer

June 27, 1958

sum-

Lakepointe

annual

Lakepointe

(New York City)

Investment Association of New

York

outing at Sleepy Hollow
Country Club, Scarborough on
the Hudson, Scarborough, N. Y.

—

facturing.

Page Study of:

New
day at

Quebec.

Twin

Marsh Foodliners,

Alaska—Report—McDonald, Holman & Co., Inc., 70 Pine
Street, New York 5, N. Y.

—-

Club

June 18-21, 1958 (Canada)

coln Road,

Railroad Industry—Analysis with particular reference to Chi¬

Now available

annual field

25th

Westchester Country Club, Rye,
N. Y.

Investment Dealers' Association

New York 5, N. Y.
Marmon Herrington—Analysis—H.

Bond

of Canada annual convention at

Maine

Oil in

(New York City)

Municipal

Mackey Airlines, Inc.—Memorandum—Atwill & Co., 605 Lin¬

Angeles - annual
Spring
at the Coronado Hotel,

June 13, 1958

Co., 110 East

Madison Avenue, New York 22, N. Y.

parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks
used in the National Quotation Bureau Averages, both as to
yield and market - performance pver a 19-year period —
National-Quotation Bureau, Inc., 46 Front Street, New York
4, N. Y.
Nickel: Industry — Analysis of outlook — James Richardson. &
Sons; 173 Portage Avenue, East, Winnipeg, Canada and Royal
Bank Building; Toronto, Canada. Also available is a review
of the Canadian Construction Industry and High Yield Cor¬

For financial institutions

Country

•-

Security Traders Association of

Redpath, 52 Wall Street, New York 5, N. Y.

E. J.

selected issues—

First Boston Corporation, 15 Broad .Street, New York 5, N. Y.
Over-the-counter Index—Folder showing an up-to-date com¬

-,v

Invemes

June 13-14-15, 1958 (Los Angeles;

Bank, San Juan, Puerto Rico.
W. R. Grace & Company—Bulletin—Joseph Faroll & Co., 29
Broadway, New York 6, N. Y.
Great Southern Life Insurance Company — Analysis — Eddleman-Pollok Co., Bank of the Southwest Building, Houston 2,

York 5, N. Y.

Rock Island & Pacific Railroad, Missouri-Kansas-Texas
Railroad, Seaboard Air Line, Great Northern Railway, Den¬
ver & Rio Grande Western, Kansas
City Southern Railway,

at the

Club.

Tex.

cago,

ment

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

June 7, 1958 (Toledo. Ohio)
Toledo Bond Club annual out-

port for period ended March 31, 1958—Government Develop¬

New York.

poration Bonds,

(Chicago, 111.)

nuai field day at the Knollwood

Government Development Bank for Puerto Rico—Quarterly re¬

Yamaichi Securities

Life Insurance Company Stocks—Data on 21

jr
1958

Bond Club of Chicago 45th an-

Georgia Pacific Corporation—Analysis—Aughincloss, Parker &
,

(Pittsburgh, Pa.)

1958

Club.

Wisconsin Avenue, Milwaukee 1, Wis.
Also
memorandum on Hamilton Manufacturing.

June 6,

C. Roney .&

Co.—Memorandum—Wm.

Gas Service—Memorandum—Robert W. Baird &

dall Co.

34th

Pittsburgh annual
spring outing at the Longue Vue

Buhl Building,

memoranda

York

Bond Club of

Detroit 26, Mich. Also available are
Portsmouth Steel Corp., River Raisin Paper
Co. and Standard Tube Co,
Co.,

Broad

New

day at Sleepy Hol¬
Country Club, Scarborough,

June 6,

William S. Moore, Inc.

Manufacturing

N. Y.

—

{

annual field

•-

Angeles an¬
the Oakmont

(New York City)

Club

Bond

Sunning-

Country Club.

McKin-

Scherck, Riohter Company, 320 North Fourth Street, St.
f* Louis 2, Mo. ■
Vv-.-V
'' V :V
I',
Cormae Photocopy Corp.—Analysis—Casper Rogers Company,
40 Exchange Place, New York 5, N. Y.
.
V
Eastern Industries, Incorporated,—Bulletin—De Witt Conklin
Organization, 12Q Broadway, New York 5, N. Y.
Emporium Capweli — Report — Dean Witter & Co., 45 Mont¬
gomery Street, San Francisco 6, Calif.
Also available are
analyses of; Staui'fer Chemical Company and Pacific Clay
Prdducts.
;
• J
Equity Oil Co.—Data—James M. Toolan & Co., 67 Wall Street,
New York 5, N. Y.
•
Erie Resistor Corp.—Memorandum—Fulton Reid & Co., Union
Commerce Building, Cleveland 14, Ohio. Also available is a

national

Company,

Gas Company—Report—Thomson &

Los

nual Field Day at

Foreign Exchange Quotations—Folder listing current quotations
of currencies of 141 countries throughout the world—Inter¬

Latest Field

11 Wall Street, New York 5, N. Y. Also available is
report on U. S. Borax & Chemical Corp.

Colorado

Index—Discussion with a brief analysis
oi six farm equipment stocks—du Pont, Homsey & Company,
31 Milk-Street; Boston 9, Mass.
Fire & Casualty Insurance Stocks—Comparison of 1957 earn¬
ings—Laird, Bissell & Meeds, 120 Broadway, New York 5,

—

Fire

non,

Market Trends—Analysis in Monthly

Current information

City

Club, Scarsdale,

(Los Angeles, Calif.)

Club

Bond

Casualty

Brooklyn Union

—

June 6, 1958

Company, Pacific Indemnity Company,
Pacific Insurance Company and Peerless Insurance Company.

Farm Equipment Stock

Japanese Stocks

Kansas

dinner

and

Country

Y.vV.;;

Y. Also avail¬

list of investment suggestions — Ross,
Knowles & Co., Ltd., 25 Adelaide Street, West, Toronto,
Ont., Canada.
Canadian Review—Monthly bulletin—The Bank of Nova Scotia,
Toronto, Canada.;
*
Dividends-Every Month—Suggested portfolio—Reynolds & Co.,
; 120
Broadway, NewYork 5, N. Y. Also available is a selected
list of large electric power and light companies.
with

Bulletin,

ament

dale

Huff &

Pine Street, New

partment, The Chase Manhattan Bank, 18
York 15, N. Y.
Canadian

Stock Exchange 5 &
V 20 Club 12th annual golf tourn¬

Bankers

ciation,

1958 (New York City)

American

Arizona Public Service Co.—Memorandum—Edward L. Burton

the United States—Comparative

Company, 15 Broad Street, New York 5, N.
able is current Foreign Letter.

June 5,

American

figures as of March 31, 1958—New York Hanseatic Corpora¬
tion, 120 Broadway, New York 5, N. Y.
Burnham View — Monthly investment letter — Burnham and

Grove,

North Syracuse.

Company, 231 South La Salle Street, Chicago 4, 111.
Optical—Data—Herbert E. Stern & Co., 52 Wall
Street, New York 5, N. Y. Also in the same circular are data
on Kennecott
Copper.

nuclear projects,,
planned new uranium-miiling capacity to be allocated by
AEC, and developments affecting Algom and Pronto Uran¬
ium Mines—Atomic Development Mutual Fund, 1033 Thir¬
tieth Street, N. W., Washington 7, D. C.
(No. 38) on growth of civilian

Hinerwadel's

outing at

Co., 135 South La Salle Street, Chicago 3, 111.
Hospital Supply Corp.—Memorandum—The Illinois

(Syracuse, N? Y.)

Club of Syracuse annual

Bond

;

American
Atomic Letter

Field

Investment

Recession

Post

Boom—Discussion—Park, Ryan,
Inc., 70 Pine Street, New York 5, N. Y.

Recommendations & Literature
it is understood that the firms mentioned

Thursday, May 29, 1958

COMING

Industrial

vs.

120 Broadway,

Co.,

5, N. Y.

Stock Market

Dealer-Broker Investment

Ohio—Sutro

thronicle

June

27, 1958 (Philadelphia, Pa.)
Philadelphia
Securities Asso¬
ciation annual outling at the
Overbrook
Golf
Club,
Bryn
Mawr, Pa.

June 28, 1958

(Chicago, HI.)

Security Traders Association of

Mine

Chicago summer golf outing at
-Woodridge Country Club,
Lisle, III. , : — - !

Safety Appliances Co.

the

World's

largest producer of safety equipment;

the- pioneer .manufacturer of
boron fuels- and thermal
in

EQUITY OIL CO

Aug.- 21-22, 1958
Bohd ' Club

high-energy:

batteries; leader

Bought

—

Sold

—

Quoted

* *

high temperature liquid metal technology.

Troster, Singer & Co.
Members New York Security Dealers Association

Trinity Place, New York 6, N. Y.

HAnover 2-2400

Colo.) ."

Teletype NY 1-376-377-378

Denver

Rocky

Mountain. .Group IBA 24th
nual .summer frolic' at the

anCo¬

lumbine Country Club:
—

(Denver]

•

—

JAMES M. TOOLAN & CO.
67 WALL STREET

NEW YORK 5, N. Y.
Teletype NY 1-2630

Telephone HAnover 2-9335

.Sept. 18-19, 1958
Ohio)

;

(Cincinnati,

Municipal Bond Dealers Group
annual outing — cocktail and
dinner party Thursday: at Queen
^City Club; field day Friday at
Maketewah Country Club.

Sept.

29-Oct. 3, 1958
Springs; Colo.)

(Colorado

National Security Traders Asso¬
ciation Annual Convention at
the

Broadmoor.

Volume

187

Number 5746

The Commercial and Financial Chronicle

unit of output, and this must
a further increase in prices.
true, in the absence of a
corresponding expansion of pur¬
chasing power, consumers would

Dr.

titled to be compensated for any
increase in the cost of living, even

not be able to maintain the vol¬

ume

per

increases

Einzig looks askance at newly developed British formula
allowing wage increases, in nationalized industries, so long
they are coupled with neutralizing, increased productivity.

the

readily be imitated in
and, in either case, sees no stop to higher
wages producing higher unit costs and, in turn, higher prices.
So long as trade unions insist, and receive,
compensation for
higher cost of living and for increase in output, the outlook
for runaway inflation is assured
according to this across-thesea economists
who, thus, disapproves of relaxed anti-inflaticnary policy accompanying this new wage formula.

level.

But

May 22

the

to .5%%

to indicate that

totally

appears

Government

trade unions

not

unduly

worried about

different

smaller

the prospects
of a not her

maintain the

round of wage

ployees

in¬
of 3%.

very

JpHjl

be worked,

in which case the total wage pay¬
ments would increase in spite of

the

day when

reductions

the

number

employees.

increase in

Paul

the cost of liv¬

and

when

that

the

Moreover,

Einzig

new

ing index by 2
points in April

was

announced,

also announced

was

terms

have

trade

the

Government's

formula would not

tend to

provide

cost inflation
mand

inflation.

even

caused

Found

pre¬

remedy against

distinct from de¬
Its declared

aim

With Shumate & Co.

indications of any

abandon

that

concep¬

Indeed, the latest Socialist

titled

Defective

are

formula

that

workers

annual

wage

are

en¬

increases
corresponding to the increase in
the cost of living plus the increase
in the output.
If such a superinflationary formula should be
widely accepted Britain's economy,
would be doomed to runaway in¬
flation.
V:v
.

The Government's formula could
not be continued to be applied in¬

definitely
services.

even

There is

the

Jos. A.

public

limit beyond
which these services dbuld not be
reduced.

for

private

With

any attempt to maintain a limit
to total wage payments in face of
the rising wage rates would neces¬

Having regard to above consid¬
erations, it seems that the Gov¬
ernment's enthusiasm for its

new¬

firm against wage demands at the
risk of major strikes or to admit

In the past he was a
in Daniel Reeves & Co.

vard.
ner

is¬

Southwestern

with Norman J. Sitzenstatter
Vice-President and Manager.

sues,

Mr. Sitzenstatter was formerly an

officer

Eppler,Guerin

Turner, Inc.

part-

Edward V. Mills With

Malcolm Rogers With

Irving Lcndborg&Co.

Walston & Co., Inc.
OAKLAND, Calif.—Malcolm X.
has rejoined Walston &

Rogers

Co.,

408 Fourteenth

Inc.,

Mr. Rogers

(SpeclaitoTHE Financial-Chronicle;

SAJtf

(Special to The .Financial Chronicle)

But the al¬

ternative to putting forwax-d this
formula would be either to stand

N. J. Sitzenstatter

specializing in
as

BEVERLY
HILLS,
Calif.—
Joseph A. Field, Jr. has become
associated with Hemphill, Noyes
& Co., 9478 Santa Monica Boule-

ly-invented formula of disinfla¬
tion through redundancy is mis¬
placed. Perhaps the Government
is well aware of this.

Fnld, Ji.
HeajMII, Noyas

(Special to The Financial Chronicle)

firms,

decline unless

overtime would

the

would

output, and if

same

staffs would show

The Bank rate
decision was
made

men

tion.

ish to grant wage increases on the
strength of such agreements. What sarily lead to a curtailment of the
would probably happen would be
of 1C+v,P1°ua.Qiy,naPP^
that.the output of the wouia pe output, which again would reinreduced force the rising trend of
prices.

crease

™en.\

Rail-

the

to agree that a

past experience it would be fool¬

ated by granting the em¬

w.a

such agreements were to be hon-

•increases initi¬

British

matter

were

number

unions

in practice the higher

Other Grounds

Norman Sitzenstatter

possibility of inducing the trade

which, if satisfied to
any
considerable extent, would
provide the purchasing power to
maintain the demand in spite of
the higher prices.
;

It would be

tion in their staffs.

prices would result in additional

Formula
the Bank rate from 6

level,

wage claims

LONDON, Eng.—The reduction wipe out the benefit of the reduc¬
on

price

would tend to bring down the in¬
creased prices to their previous

the private sector

of purchases oh the basis of wage
higher prices. In theory, there¬ vail.
fore, this should prevent an in¬
There
crease

wage

DALLAS, Tex. — Shumate &
by the previous
Company, Inc., # First National
increases, continues to pre¬
Bank
Building,
announce
the
opening of a trading, department

the

The writer anticipates this new policy of cutting down uneco¬
nomical services and output will not so

inflationary

long as the concep¬
tion that organized labor is en¬

It is

By PAUL EINZIG

stem the tide of

mean

A New Method of

(2397)

con¬

;

Calif.

—

Edward V. Mills has become as¬

sociated with Irving Lundborg &

Street, Co.,

has recently been

FRANCISCO,

bers

310
of

Street,

Sansome

York

the New

is to keep

mem¬

and

Pa¬

down demand by pre¬ candidly that the disinflationary ducting his own investment busi¬ cific Coast Stock Exchanges, Mr.
move^d against Britain.
So the new
venting an increase in the total drive has failed.
Wage demands by trade unions
ness, Rogers & Co., in Oakland. Mills was formerly with White,
of consumer purchasing power re¬ formula is as good a face-saving
representing 8% million workers
In the past he was Vice-President Weld & Co. and prior thereto
sulting from the higher wages. But device as any that could be de¬
are under consideration, and their
higher wages mean higher costs vised at short notice. Nothing can of the First California Company. > was a .partner in Reynolds & Co.
outcome may decisively influence
the trend of prices and exports.
Yet the authorities 'decided to re¬
lax

the

disinflationary drive by
lowering the Bank rate

further

This announcement is neither
The

from its crisis-level.
New

Formula

Wage

offer to sell

nor a

solicitation of offers to buy

any

of these securities.

offering is made only by the applicable Prospectus.

May 28, 1958

NEW ISSUES

•

The

explanation of official op¬
timism lies in the development of
a new formula which, the Govern¬
ment hopes,

would be able to neu¬

inflation

tralize

created

This formula

increases.

by wage
actu¬

was

Transcontinental Gas Pipe Line

ally applied in the terms of the
railway wage settlement. The 3%
increase was granted on the un¬
derstanding that the additional
million

£10

would

for

year

$25,000,000

wages

found by

cutting down
corresponding degree.
railway lines
which have been run at a loss will
be

services to

Corporation

First

Mortgage Pipe Line Bonds, 4%% Series Due 1978

A number of branch

(Due December 1, 1978)

this
gravely detrimental to the

be closed down, even though
will be

interests

The

serve.

districts

the

number

Price 99.25%

they

Plus accrued interest from June

passenger

trains will be reduced, even

1,1958

though

this is bound to cause considerable

inconvenience

the

traveling

As a result, many thou¬
sands of employees will become
redundant, and through their dis¬
missal the total of wages paid by
public.

British

Railways

is hoped to

150,000 Shares
Cumulative Preferred Stock, $5.70

Series

(Without Par Value—Stated Value $100 per Share)

kept down at its present figure in

spite of the 3% increase in wages.
Government

The

make

intends

Price $100 Per Share

effort to ensure the ap¬

plication of this formula to other
wage settlements. This is feasible

Plus accrued dividends

from May 1, 1958

in the case of nationalized indus¬

tries.
intends

The National Coal Board
close

down

number

of uneconomical

Copies of the applicable Prospectus may be obtained in any state

der to be

coalfields, in or¬
able to concede part of

the

increases demanded by

Underwriters,

wage

•

the National Mineworkers Union.

Other public services run by na-.
tional boards will doubtless be in

only from such of the several

including^ the undersigned, as may lawfully offer the securities in such state.
.

•

Stone 8i Webster Securities Corporation

White, Weld & Co.

position to save money for wage

increases, by giving less satisfac¬

tory services to the public. When
it comes to privately-owned in¬
dustries, however,
not so simple.
.

Doubts Increased

Will
The
•money

the

Glore, Forgan 8C Co.
Lazard Freres 8C Co.

Result
may

Goldman, Sachs & Co.

Harriman Ripley & Co.
Incorporated

Kidder, Peabody & Co.

producing less, but if
output would

Lehman Brothers

Merrill Lynch, Pierce, Fenner & Smith

save

private firms should do the same
the decline in their

The First Boston Corporation

Eastman Dillon, Union Securities 8C Co.

Productivity

public services
by

Blyth & Co., Inc.

matter is

Paine, Webber, Jackson & Curtis

Smith, Barney 8C Co.

The Commercial and Financial Chronicle

Thursday, May 29, 1958

(2398)

Ameiica Needs More Stockholders
\

Fcnner & Smith

too well.

of public education

The program

only

mentally

it
desirable

for

(everyone

developing

it is de¬

business
has had to put into new plant and
and from the
L°u,s EneeI
point of view of our national equipment over the years. From
the turn of the century until the
economic welfare. I would like to
end of World War II, it applied
$218 billion to that purpose.'

principal rea¬
sons for this conviction.
The first
is the fact that American business
over the years has grown steadily,
view. There are two

level of 8,630,-

still

that this

Stock Exchange says

shareholders

number 9,000,000.

Public Ignorance

this country.
national product

gross

But
Why is it that more people don't
The

alone, from
1946 to 1956, it put $232 billion
into plant and equipment—more
in that one decade than in all the

invest in American business?

to that

answer

can

word: ignorance.

increased

had

steady

nice,

billion—a

$100

growth.

pattern

But the blunt fact of

Some of it.

matter is

the

that

money

the great

be put in one

It is almost im¬

bulk

that business will
ahead must come

need in the years

shares of Ford stock.

from

these

One
an

requests
came
influential and successful
dealer

Chevrolet

town

from individuals. And by "individ¬

Texas,, a
presumably well in¬
what
happened in the succeeding 15 uals," we necessarily mean people formed businessman. He ex¬
of moderate circumstances. It must plained that he thought it was a
years.
From 1940 to 1950, gross
national product rose from $100 come from millions of people with fine thing the Ford Company was
billion to $285 billion and by 1955, hundreds of dollars, rather than doing to let the public participate
hundreds
of
people
with in ownership of the company and
it stood at the astounding level of from
he concluded by saying that he
$390 billion—a figure ten times millions of dollars.

But

nothing

what it

the

in the days just before

was

World

first

national

gross

compared

Last

War.

product

year,

$434

was

billion.
isn't the

that

But

The staff

whole

story.

economists on the Joint

Congressional Committee on the
Economic Report tell us that the
rate of production is going to ac¬
celerate still further until by 1965
national product will reach

gross
a

level of $535 billion.
A second

invest

why it is good

reason

that

stocks

common

help offset the decline in the
purchasing power of the dollar.

can

The

dollar

until

worth

has

1913

only

dwindled

cents

This, of course, means that
prices have virtually tripled since

today.
1913.

But

price

average

listed

that

the

Exchange
800%.

has

same

period,

stocks

common

New

York

increased

the

Stock

roughly

They have virtually tripled

in the past ten years alone.
Now

you

there isn't

mon

stocks.

But

you

there

may

risk

properly

should

ask

risk

com¬

risk.

remember

that

just having
money—the risk that the dollars
you
as

simply set aside

much

you want
do now.
*An

years

may

not buy

come

to spend them

address

when

they

by Mr. Engel before the
American Management Association Sem¬
inar -on investors delations, New York
City, May 7-9, 1958.

because

of the

great

wished his own company
redistribution of wealth and in¬ would let people buy its stock! He
come which has been effected in
didn't know he could buy a share
this country over the past 25 years of General Motors from any bro¬
as
a
result of the application of ker
or
security dealer in the
our tax laws.
Today, the million¬ United States by simply making a
aire can aptly be described as the telephone call.
Vanishing American and the great
The best documentation of pub¬
social phenomenon of our time
lic ignorance about securities is
has been the rise of the middle
afforded by a survey made some
class. Let me give you some idea
years ago by the New York Stock
of
the dimensions of that phe¬
Exchange. The researchers asked
nomenon.
Since
1941, the total
people what they would do if they
number of families has increased
suddenly received a large sum of
to 56 million—up 42%—but the
money—money which they didn't
number of families with incomes
need for any purpose.
To make
of $5,000 and over has multiplied
the
problem
easy,
six possible
12M> times—up from IV2 million
channels of investment were sug¬
to 19% million.
gested to them — government
Before the war, a family with a
bonds, common stocks, life insur¬
$25 a week income was typical.
ance, corporate bonds, real estate,
Now that same family has a week¬
and savings banks.
People were
ly income in excess of $75 a week. not restricted in their choice of
You may

income

that this increase these various types of investments.
not too significant In other words, anyone who was

prices have increased so
rapidly. That's true, they "have.
also

true,

drastically.

too.

But

for

And
in

once

questioned could say that
he would put some of the money
into the saving bank, some into
life insurance, some into common
stocks, etc.
being

history, income has increased

our

faster
As

point out that taxes have

gone

that's

only

say

because

You may

in buying

Yes, there is

This

even

than

prices and taxes.
have in the

consequence, we

aggregate today

cash savings

Here
survey:
of

the

bonds.

and money in the bank than ever

into

before.
sets

just
is

held

as¬

by people amounted

about

over

1940, these liquid

$50

$200

billion.

Today

billion—more

four times greater.

banks.

than

the

are

results

that

83% said they'd put some
money
into government
67% said they'd put some

life

they'd

h i

invested

the

possible to overstate the extent
to go on growing. preceding years of this century.
of public ignorance about stocks
Obviously, benefit is to be gained And the Joint Committee on the
Economic Report predicts that by and bonds. You may recall in 1956
from sharing in this growth.
1965 capital requirements of busi¬ that the common stock of the Ford
I dislike using statistics, but it
Motor Company was offered to
is only in terms of figures that I ness will rise from their present
the
public
for the first time,
can
trace this dramatic story of levels of about $35 billion to an
;■<,% and this well-publicized offering
industrial expansion. In 1913, this estimated $65 billion a year.
seemed to catch the imagination
Where, you may ask, is this
country had a gross national prod¬
of many people.
Like other in¬
uct of approximately $40 billion, money coming from that business
needs? From banks?
Some of it. vestment firms that helped to un¬
according to the Department of
derwrite this gigantic issue, we
Commerce. "Gross national prod¬ From insurance companies? Some
were
beleaguered
by
requests
uct" is the economist's phrase for of it. From pension funds? Some
from
all over the country for
From trusts and estates?
the total value of all goods and of it.
1940,

the only

also about

the

insurance.

put

some

42%

into

43%

said

the

savings

real

estate.

Finally, only 16% ^of the
said they would put any
money

into

common

Continued

people
of the
stocks, and

page

this

corporations, of
course, seem to be working hard
at doing a job.You know the
annual

evidence

some

Lots of

case.

hallmarks

tockholder

money

and it is going

routes

not too long ago

was

well

-as

that is

report

do.

slick and

good

easy
as

editorial

pre¬

judg¬

ment and the four color press can
make it.
There are other

signs,

too.
The

hard

working stockholder

relations staff—even if it is

in.

These

in the next ten years

services produced in

the small

way
s

the traditional

one

to success.

only

that

There

Marrying the Boss' daughter is

sentable

explain why we believe investing
is good from the personal point of

means

your

en¬

the eyes and

American

money

this

Still,

fair dividend; and via stock ownership "put
money where your mouth is."

pay a

stocks, and this figure con¬ could'get the
unhappily with the 48% of full financial
families
who
own
their., own story of a cor- Y
homes; and with the 73% who poration he
own life insurance.
Currently, the might have

Capital Requirements

much

some

about 13% of all the families own

give you an idea of how

fully;

any

Let

personal
point of view
the

company's full story to the press, investment bank¬
brokers and security analysts; to make the reports worth
reading; conduct the annual meeting meaningfully and grace¬

trasts

Future

from

sirable

000.

machines which

new

provides

one

criticisms

ers,

Alfred Politz Re¬

increased 33% to

constantly

are

this

Lists

tell the

stockholders.

couraging news—because it shows
that in the intervening four years
the number of share-owners has

produce more efficiently.

can

We be¬

stock.
lieve

but

out

wear

share of

gle

and

only
hand. Not only do machines

5% by

buy even so
as a sin-

much

about 10% of all families.
findings, I may say, came
a shock to Wall

Two years ago,

of conduct of annual meetings.
executives' growing awareness of their
shareholders as potential consumers. Urges managements learn
who their stockholders are, and give them what they want;

search, Inc. made another census
for the New York Stock Exchange

produce is made by machines,

afford

About 95% of everything we

omy.

invest who

can

growing at the rate predicted by
the economists, it is going to need
money for new plant and equip¬
ment. Ours is a mechanized econ¬

believe

many

Maintains

programs are

Commends company

Street, who always assumed that
.

going

business

premise:

one

relations.

something of

there were two or three times

national economy.

our

showed that

million share¬
holders in America, representing
about 4% of the individuals and

funda¬

census

appraises the stockholder's present status.

characterized by lip
service and lack of follow-through, and that conviction at
top
management levels is required for really good stockholder

there were just 6V2

pursued investing is good from an individ¬
using virtu¬ ual point of view.
Now let's look at the problem
of communica¬
from the broader point of view of

possible,

That

holders.

Those

tion

secrecy,

present stockholder relations

stock¬

American

"Herald Tribune"

Well-known financial publicist, after citing company attitudes
of former times when financial information was cloaked in

census

which Merrill Lynch has

rests

Business and Financial Editor, New York

continued

tion of Washington completed the
first

for the past 15 years,

ally every means

needs for

1952, the Brookings Institu¬

why

reasons

order

The frank answer is: Not
"

growth?

the A B C's of investing, and stresses the
of this in terms of the individual's protection
against price inflation and the national economy'* welfare.
for the

industry

funds

the

the public in

much

The Neglected Man
By DONALD I. ROGERS*

that American industry may have

importance

you may

American

Engel sees as the saving grace to the problem of meeting
economy's continuously increasing capital requirements pre¬
sented by people's ignorance of investing in American busi¬
ness the fact that people do "want to know."
The securities
dealer recounts efforts made by his firm to acquaint and edu¬
Mr.

cate

well,

persuading people to buy a share

City

New York

The Stockholder:

ask, are we
doing in channeling these savings,
these liquid
assets, into invest¬
ments? How well are we doing in

By LOUIS II. ENGEL*

Vice-President, Merrill Lynch, Pierce,

Well

Doing Too

Not

How

man

were

days in

band,

answers

speak

one

—

that

letter no matter
every complaint, ho
infantile; the welcome
new
stockholders; the

every

which most of_

how

the

matter how

newspa-,

pers

kept

letters

intown
a pool of

one

Donald

share odd lots

reports;
plant tours;
"Open House"; the "Road Show"*
regional annual meeting, and all

Kogera

in several com¬

ready

panies

interim

two-

o r

trivial;

the

use

during the

other

7"Win Friends and In¬
People" techniques that

fluence

Unless

fertile

they were armed with a proxy,
reporters just couldn't get a foot

This

meeting

annual

season.

the front door.

And

days—not so remote as you think
characteristically a bare-

—was

statement,

two-page

bones

often

interesting for what it con¬

cealed than for what it

devise.

can

all

the

revealed.

good.

But

of it, I am afraid, does not

much

spring from the genuine

in those

the annual report

minds

convic¬

tion that the stockholder is really
a

friend.

tise,"

Much

of this "exper¬
afraid, is simply just
lip service. The stock¬

much

holder is still the bore at the cock¬
tail

grin of
really the grimace of

That seeming

party.

Earnings

and assets, as a matter
top secret stuff, and
as jealously guarded as the com¬
bination to the underground vaults

welcome

of fact, were

the stout-hearted fellow who will

at Fort Knox.

kills

bear

under

keep

all

—

appearances

who will
if it

even

him.'

•
■

The

Mystery, the Mother of
Manipulation
secrecy,

I say
sons.

There

have

all

by almost everybody

be de rigeur

few free-thinking non¬

except a

conformists. They, of course,

could

refuge in the
if necessity
"mother of in¬
vention,'' then mystery was the
mother of manipulation — as of
take

but

little

that

understanding

course

fort

this

though, and
examining the

refuge,

commentator,

balance

sheet

company,

took

major

paper

really good look

"Mills, Plants
Water Powers" and somewhat

and

There was scant com¬

it is.

one

the

really

was

item

headed

despairingly conjectured that the
figure certainly did contain "A
generous volume of water."
This
was
a
time,
obviously,
when

management uncompromis¬

ingly regarded the stockholder as
a foe—an
antagonist. The stock¬
holder was not a bell cow to be
courted, but

Now it appears

that things have

the

a number of rea¬
corporations which

customary trappings
relations; the frost¬
cake; the four-color

ing

the

annual report—and no real under¬

standing

of stockholder relations

at all. It takes

technical skill

some

to generate these

trappings and it
takes a willingness to spend some
money.
Given these factors, you
can't write down the ability of
these

corporations

construct

real stockholder relations program.
But

since

since
and

they have the skills;
have the trappings—

they

real

stockholder

program—you

that

can

management

relations

only conclude
is just
going

through the motions; it is paying
lip service to an ideal for which
it

has.no

conviction.

holder is still

—only

now

The

stock¬

Bossy to be milked
we'll do it with a

smile.
A

Let

Situation

are

of stockholder

Bossy to be milked.

The Present

this for

though

fashion, was thought

much

cloak

This

Trappings

Reporter's Experiment

porters,
are

show what I

mean.

editor

every

Machiavellian

lot.

Re¬

knows,
I

know

changed—but have they really?
Has management really come to

this because—as the press agent's

regard the stockholder as a friend?
Has it really stopped biting the
hand that feeds it—or is manage¬

porter myself."

simply going through the
motions—smiling through
bared

quote from "The Prince" and the

might suffer
a
bore at a cocktail party, the
while meditating on the clinical

scripture, and

ment

teeth

much

you

joys of slipping a stiletto between
his sixth and seventh ribs?
*A

talk

Rogers before the
Association, • New
1058.

Mr.

American .Management

"York City, May 7,

favorite cry goes,

ago

"I'm an old re¬
Well, not too long

of the really Machiavel¬
types in our shop — he can

one

lian

"Discourses"

expense

like
you

the

devil

should

accounts—came

firebrand of

from

see

his

with

idea.

immersed

the

usual crop of annual reports

and

was

had

been

struck

one

Continued

thing.
on

Those

page

Volume

Number

187

5746

The Commercial and Financial Chronicle

...

(2399)
have

publicly acknowledged that,
through the use ; of funds and

Commercial Finance

CompaniesRole in Present Day Lending Field

assistance supplied by commercial
finance companies, they were en->
abled to grow into highly success¬
ful multi-million dollar
publicly
held

By J. MARTIN SEILER*
:

Executive Vice-President, A. J. Armstrong Co., Inc., N. Y.

City

only

marily because of

poor

ment.

rigorous

commercial

ipetitive

Several
in

Banks

bills

Congress

capital

are

for

banks

for

pending

would

small

manage¬
com-

conditions

conscious

market

tively,

now

which

Because

existing to¬
f day, all business finds itself in a
period where only the efficient,

Small Business

Co., National Air¬
lines,, Dow Chemical Co. Con¬
tinental Motors, Diners Club of
America,
O.
A.
Sutton
Corp.,

many

cost

Proposed Capital

Among them,.
few are, Mon-.

financing helps

small businesses with -limited capital to grow."
-

,isanto Chemical

Vice-President, National Commercial Finance Conference, Inc.
: v—
New York City
■ •

corporations.

,to mention

tunities for expansion.
While not
substitute
for
equity
funds,

create

business.

its

operator,

can succeed.
business and

when

able

merchandise
It is

effec¬
time

industry

are

facing a fundamental test of their
efficiency and ability. •
»

>
disabusing misconceptions held regarding the commercial
Some of these bills have power¬
Government financing, which
j
industry, Mr. Seiler explains to bankers: (1) the ?_■?<• Lithium Corporation and Vitamin ful backing, such as that of Sen¬ would subsidize and keep alive
Corp.:of America..
*
ator .Lyndon
Johnson, Represen¬ small business which is marginal
distinguishing, important differences in the various types of :':
tative Wright Patton and the Ad¬
or
•Finance Companies Are Not
incompetent, and does not have
finance companies making up the industry; (2) why finance
ministration,
In
essence
a
these
valid economic reason for ex¬
Competitive With Banks
i
companies are not competitive with banks; ant) (3) specialized C
bills .are for the purpose of mak¬
istence, cannot be a panacea for
/ V Bank men may wonder whether ing
v
techniques and services provided in domestic and international
available sources of ; equity the economic ills of our country.
i
commercial finance companies are
capital as well as providing long There may be a place for such
trade, and importance of charging proper costs in running an
not ; competing
with
banks
in term
loans to small business.
government capital banks if they
accounts receivable department* Asks bankers not to fix a
making- loans.
That is not the
Obviously, in the light of pres¬ confine their activities to furnish¬
ease;
Wherever
the
account
is
iportion of their loanable funds to "finance industry" but to
ent day business
conditions, this ing equity capital and

financial

•

break this general category down into

and seasonable

of funds.? The author denies

use

restricted to those'

;

concerns

financed with and without bank cooperation. ^ 4

Ai Bank

executives

the fact that there

aware

are

;

'*•>:

The sales finance

company ;.

g a

n s

risk.

nesses'that

and

The

buys

ordinary

;

not

qualify
bank

unsecured

account

the

commercial

vide

credit

not

merely

substitute for bank

finance ;fers* a
continuing

credit.

(B) The small

make

loans of

guaranty of the

limited

addition, usually receives the

size,
to

pursuant

sonal

the

v a r

ion s;

'ttnr debtor

ISmall loanr,
laws

the

per-

guaranty of the owners of

business.

The

additional financing to meet

factor

make

and

special

the

Jacob

Martin

Seiler

panies which
buy paper arising out of the sale
i to the consuming public of appli«!

white goods, furniture, etc;
Companies who lend against
arising out of the
sale of machinery and equipment;
(E) Factors, and (F) Finally, comances,

(D)

;•
*■

buy paper

di-

receivable

mercial accounts
>

panies.

•*.'

com-

to the various

types of companies
as "finance companies," and place
them in one category in considering their loans. I respectfully
submit that, except for broad gen-

this

eralizations,

quite

not

proper.. Over the years each of
the various types of lenders have

developed special techniques,

specie,-as received, to the,

Occasionally,

) derlying collateral

security

and

particular busiEach of these types of busi¬
ness
is. differently affected
by
seasons and changes in the econness.

fc.omy'
/
Frequently banks have refused
.

to
a

issue
Factor

new

line

credit

Commercial Accounts

Receivable

because

company

portion of the bank's lend-

able

funds

have

already

been

committed to the "Finance Indus¬

try."

I suggest that, where this is

done, if the bank's credit policy

committee

really

diversification

looking

risk

for

machinery

the

and

sea¬

down

of funds, it should break

use

this

general

into

category

its separate distinct and different
r

generally
loans
*

the

field

advances

and

accounts

financing embraces
of

making

secured

receivables.

differs

and

Bank

address

Credit

New York

Mr. Seiler

Associates

before
New

City.

the

York,

firms.

Finance

Companies Relationship
With

Banks

frequently of
ability and ex¬

study by Dun & Brad-

preponder¬
companies who go

small

each

Our

year,

industry looks at itself as
retailer, to such companies, of

the

funds

dustry

the

panies, lend to
quantities.
The

Associates, in

the

banking in¬
insurance com¬

wholesale

Robert

not an

offer to sell

or a

solicitation of

of borrowers from banks
throughout the country. In addigroups

Continued

page

offer to buy these securities.
•'

■

■•

$8,000,000

are

some

City of'Oslo
(Kingdom of Norway)

5V2% Sinking Fund External Loan Bonds due June
1, 1973

V
OFFERING PRICE

ports ,and, exports,^, and
lend
.against contracts for exhibition of
motion picture 01* television films,

Copies of the Prospectus
undersigned and others

badly

on the verge of bank¬
Nothing could be further,

may

from the truth.

any

State only from such of the

lawfully offer these securities in such State.

Kuhn, Loeb & Co.

Harriman Ripley & Co.

Lazard Freres & Co.

Smith, Barney & Co.

Incorporated

BIyth & Co., Inc.

White, Weld & Co.

Eastman Dillon, Union Securities & Co•

Goldman, Sachs & Co.

Kidder, Peahody & Co.

Clark, Dodge & Co.

Dominick & Dominick

Hemphill, Noyes & Co.

Bear, Stearns & Co.
Hallgarten & Co.
L. F. Rothschild & Co.

Ladenburg, Thalmann & Co.

May 28,1958

If the funds to bei

supplied by the finance company
cannot improve the prospects of
the client and be employed prof¬
itably in the business, the finance
company will generally not make

This advertisement is

not

offer to sell

That

not

The

is losing

■

closely

amine the situation to

see

for the losses

causes

temporary

and

can

ex¬

4%% Serial External Loan Bonds due June 1, 1960-62

whether
are

■'

(Kingdom of Norway)

„

very

offer to buy these securities.

City of Oslo

money

finance company will turn it
down.
The
finance
company,

will

$3,000,000

the

however,

solicitation of

offering is made only by the Prospectus.

.NEW ISST E

that merely

say

because the firm

or a

the loan.

only

overcome

remedied. It will often give its

advice

counsel

and

pany

profitable

OFFERING PRICE 100% AND ACCRUED INTEREST

helping to

turn the tide and restore the

com¬

operations.

frequently, however, the
typical customer of the finance
company is a rapid growth busi¬
ness, whose continuously expand¬
ing
sales
renuire
financing
greater than can be obtained from
tions.
of

be obtained in

ruptcy.

the

97>/2% AND ACCRUED INTEREST

as may

these

other
a

similar

matter of

rapid

growth

Copies of the Prospectus
of the undersigned

Kukn, Loeb & Co.

fact, many
companies

May 28,1958

be obtained in

any

State only from such

lawfully offer these securities in such State.

Harriman Ripley & Co.
Incorporated

institu¬

may

as may

Morris

recent study, indi¬
cated that finance companies gen¬
erally
are
one
of
the
largest

pri¬

which

and

inventory
equipment of

There

borrower.

banks
♦An

sized

The offering is made only by the Prospectus.

•

com*

panies, who are eager to lend to
deserving small- and medium-

"/>

Most

kinds of finance business.
Commercial

••

and

facilities*

NEW ISSUE

companies, such as ours, who do
both factoring and receivable financing, and in addition rediscount the paper of other smaller1
finance companies, finance im-

sonal

lending

commercial finance

makes loans secured by

fixed

accounts receivable company also >

pro-

the hazards of the
J

bankrupt

This advertisement is

commercial

methods.

and

existing
as

Frequently, in order to meet the *
In .requirements- of the client, we /
have to engineer a financial plan
the case of the Factor and com¬
mercial finance company, there is
which
may
incorporate a - com¬
bination
of various •methods
a
of
very high degree of liquidity
as
opposed to most other types lending and security.
■
of
financing
where
loans
are
One of the serious misconcep¬
made from anywhere up to five
tions that many people hold about
years. The degree of risk is dif¬
financing is that it is restricted
ferent, depending upon the un- to
those
concerns ' doing
very
laws

cedures,

A recent

ance

;

the

most

street reveals that the

sea-

;

finance company.

Frequently, bank officers refer

•

the client of the finance company.
These payments are then turned
in

with

disagreement

oppor-

financing, the relationship is gen- ^
erally confidential —there is no
notice given to the debtor — and..
payments are made/to the seller,...

over

result

lack of business

case v.-

of commercial accounts receivable

-(C) Discount
| finance com¬

existence

•

Various states;,,

for

reason

notifies

payment

rectly to the factor.

sonable 'needs

perience.

primarily upon the Underlying; assignment or sale of receivable
security,nevertheless
has' the invoices, and provides also for
borrower, and in

the

are
a

the
.

can

get that business discontinuances

flexible supply
im-

which

compa-

There

with the general thesis that small
business should be aided, if pos¬
sible. However, Ave must not for¬

of-

nies

loan

•»:

cost

sound

pro¬

higher

of Federal funds in

use

competition with banks and other

for

loans.

loans to businesses which have

such

business, and

existing
financing
institutions,
presently equipped with both per¬
sonnel and experience to render
this type of service.
■

supplying
of credit to busi-

could

definite

encouragement. However, such
capital banks should not compete

(2) The

Moreover, the financing they

the

assumes

risk

company
does
not.
Itmerely * of credit as needed, through
makes a loan against the account
Mediate- cash advances upon
receivable, and although relying v, ?-.■;■■■
,
,
.

automobiles^
trucks;

Factor

outright

t the-

security
and

large amounts

Financing;

The

-which lends
a

Distinguishes Commercial

as:

(A)

fi-Onri .excessive

dif- lowing respects:

many

ferent types of finance companies,
such

Reserve, it is stated: "In
long history these finance
companies - have developed spe¬
cialized Operating techniques and
security devices to protect them

■£•

has

However, there

vate

Federal

legislation
appeal.

are
two
things that should be
guarded against, and they are:
(!) Federal ownership of pri¬

f ; their

from factoring mainly in the fol-

political

In*-its excellent survey of Com\y mercial Finance Companies and
Factors
just published by' the

financing is
doing badly and, in expressing
skepticism about the proposed capital banks for small business,
points out how'worth-while small and large growth firms are

•

type

company will not vie for it.

business to accord with diversification policies governing risk

;

long term

worthy of bank credit, the finance

different kinds of finance

Lazard Freres & Co.

Smith, Barney & Co.

The Commercial and Financial Chronicle

for

new
programs
which
government to
expenditures for years to
come.
Many of the proposals call
for large scale new public works

the Budget
Executive Office of the President

grams are

Director forecasts $8 to $10 billion

should not
which will

Here,
be

the

Director

been

have

told

that

ly compiled in
January would
be hardly rec¬
ognizable a

later.

;

dynamic
economy the
a

factor

change

the

Stans

Maurice

work pro-

for the government sector
of the nation's economy.
In any
gram

•

can

now

successful
successiui

the
xne

of
01

ad vantage
advantage

forces.

our

1959 budget was pre¬

pared, we have found that certain
high priority military activities

effectively

can
even

speeded

The President there-

more.

mined to assure that this spendis down, our defense costs are up, ing
s
devoted to sound and
anti-recession measures are under essential purposest and that presway
and deficits of serious pro- sures lor pump-priming do not
portions confront us. Simple pru- lead to unnecessary military exdence compels us to rethink our penditures.
But there is no eswork program and look critically caping the great budgetary cost
to the Federal Budget. Our income

of the additional ex-

us.

have

said

the

with

involved in providing adequately

much

reckon

change. This
that we either pro¬
of

factor

does not mean

this

country, given present world

being urged

penditure proposals
I

for

con¬

by it. Rather, it means
have to accept it within a

its
meaning, its needs, and its prob¬
that

perspective

measures

This is far from

able duration.

"do-nothing" psychology;

dSto*»,
with

our

Altered
Even

something about

try is facing at this time and its

implications for the years to come.
I hope that by doing this I can
help to clarify some of our fiscal
problems and how we might best
..

wth1

public works

ih'

wiinminis

tnem.

croaams

&en~

about those concerned

with water

dienation

Cut

budspf

and

cession

ot Soviet

This

epf

technological prog-

course,

substan-

expenditures

our

too

making great progress

had

been

shifting
reshaping

a+ P-f"

Significant
*An

address

hundred¬

of the century

Course

measure

are

the

Stans

before

the

National Rivers and Harbors Congress,
Washington, d. c., May is, 1958.
-

re-

have taken

and

the

new

agencies to speed up
planned purchases of supplies and

estimated

lhan *6billion for Public works'
hj«wav
™r>ctr.tn+irm
.

_,.llia.

2^
and modeinization

Fed-

construction hit
Now let's look

the

water

peak.

"i-

and

resources

programs.

his

meet

tion is sought only after basic in¬

Natiohal

ence, f.the

Harbors
the

Rivers

contributed

has

can t
ahead.

economic

our

Pressures

tai,y 1820 s hoc cnont
thiough
,i,u;prnmon(
b)r

o"oTw tt of the

J9oT,

inc

<fc11' Hil 1 inn

iCorns

and

and
of

our

With your back¬

water resources.

ence

you

can

this field, I am sure

enactment

efforts

that
in the

helpful

most

coordination

are

*SedS5
«le Mo^than

hal

?n tU°ne. More than hall of

]J11S investment has been made in
1b|,ast *^ total^ investment wiU
J9a9' .!, n5 2}
hi!i!!n Thl!
^
9i

struction

only.

substantial

£ui"
They

exclude the
spent
for

amounts

mended

his

letter

Senator Knowland

sentative Martin
these

out

and

Repre¬

which carries

—

principles.
is

.There

April 28

.1.

backlog

cies

were

these

two

of al¬

organized

employees

been smothered by seniority

performance.,
It

throw

upon

best we can and look
employees as tools of

our

the union
our

rather than

ests

the
of

rigation

cern

been started.

Once

forts

all

interested

groups,

justifiable work will be

thorized

within

au¬

the framework of

budgetary policies.

know, the budget as a
a large
variety of

you

the

con¬

not

ours.

industry

need

and

concept

management-

employee relationships. We busi-'
nessmen are supposed to be smart
but we are letting union leaders
put

tion

defensive.

the

programs. We have programs for
national security, fpr agriculture,

veterans, for natural resources,
a host of other competing

and for

needs.

necessity,

these

must

priorities must be detgrmipetj.
the use of the tax;, money we

all pay, ', In that way We! can
meet

urgent

our

sponsibilities
financial

take

being

re re¬

our

with

being considered

anti-recession measures, we are

moving rapidly toward $80-billion

budgets

just

—

after the

year

loud outcry about a budget of $70

billion.

This

well

could

mean

deficit

extended

spending. Then
the pendulum will swing the other
way again and there will be great
demands

economies

for

champions- of

the

employees.
Also, by encouraging produc¬
tivity
and
loyalty
among
our

the

and the 1959 budget was amended
to provide additional appropria-

long

than new starts would. The result
will be to increase expenditures

??les'

Ti° completen the pr°Jects
way will require expendi-

under

billion

in the

no new

starts.

The comple-

later time,

change
lent ups

problems

and

consistent

deal

with

does not necessitate vio¬
and downs from year to

crisis

atmosphere of

year

'over

temporary conditions.

No Hasty
That

want

that we must keep a
sense
of perspective
about our
national problems and the budget.
The

should

recession

current

allowed

stampede

alysis

millions

The

made

role

economic
stimulate

freely

system
rather

should
to

Administration

strengthen

and

day.
this
be
to
try to

improve

re-

regretfully

withheld

his

those

projects

which contribute most to meeting

national needs, with due consider-

ap- 'ation for our total fiscal situation.

proval of an omnibus bill author-

izing appropriations for rivers and
continuing harbors and flood control im¬

In this way, you

vital

will be making a
to the present
strength of America.

contribution

and future

other

and

sound

enjoy

our

meet

will

economy

customers

our

ever

needed

thousands
will

businessmen

challenge,

standard

increasing

eating and living.

Walston Adds to Staff
(Special to The Financial Chronicle)

LOS

ANGELES, Calif.—Walter

Steinhoff, Jr., is now affiliated
with
Walston
&
Co.,. Inc., 550
R.

South

Spring Street.

•

Elworthy Adds to Staff

(Special to The Financial Chronicle)

SAN FRANCISCO,

Calif.—Jack

D. Hawkins has been added to the

Elworthy

Co.,

Ill

Sutter Street.

With Hannaford,

Talbot

(Special to The Financial Chronicle)

demonstrated

If you and I and

staff

perform his role wisely, the

devoted

have

emergencies

past

will

government
needs
the
under¬
standing and assistance of every¬

are

do.

peace

remain

Water and Land Resources

This

must

and

can

businessmen

dominate private activity.
To

for

and in wartime, this
industry has shown leadership of
a high order. This same resource¬
fulness and statesmanship which

every

than

have

and

you

economic

government

single

largest

special
obligation to solve these problems.
food,

decisions by individuals and busi¬
nesses,

the

consumer's dollar goes

the

not

depends in the last an¬

"more

anticipate.

may

Since

into

hasty, ill-considered actions which
will add unnecessarily to our fu¬
ture
burdens.
Let's not forget
that the course of our type of
economy

the

and

less

conservative business lead¬

our

ers

this

you

upon

urge

further

work" philosophy
prevail. There is
just the chance, too. that if, in
our relationships with the unions,
we
take the initiative in seeking
a teamwork approach to the criti¬
cal problems facing business, we
may find union leadership some¬
what more receptive
than some
for

now.

Action Urged

why

demands.

and

will continue to

and

still

orate

This

our

unsound

approaches are taken
..management-em¬
relationships will deteri¬

ployee

rational

basis.

if the

combatting

industry,

with

agree

strengthen

we can

Unless these

could be dealt with on

run

the country
a

will

you

that it would be far better in

tions

to continue the expanded
rates in 1959. Such actions reflect
the belief that speeding up projects already under way can provide employment more promptly

sure

employees,

cut¬

and

It Js

the posi¬

over

own

our

pay

time,

present

programs

many

national
keeping

position sound.

the

while

plaij.

con¬

inter¬

employees

the

union

our

new

welfare

about time

estimated at almost $700
of the

members
We discard

team.

company

of the chief assets of the free

and

harbor, flood control, and ir¬
projects which have hot
Through mutual ef¬

hands, bargain col¬

our

lectively

•

and

has(

that

when

now

rules,

understandable

sider

any

the

employee
initiative

The

enterprise system

agen-

million—higher than in

fall

that

the

between

most $8 billion of authorized river

budget, construction
of

may

mind

management.
our

one

backs in government programs.

expenditures

are

tactics

slowdowns and the compulsion to
conform to minimum standards of

secure

legislation — such
the President recently recom¬

curtain

ground of information and experi¬

Un" ti0n of ^'"g projects will, of
c»uf. P^ye the way for new

* recovery,
we
to what's

eyes

frame

the

uuio,iL» practices

we accept these defi- source programs at the Federal,
inevitable now, if the gov- State, and local levels. Recently

mot,inS

unions, unconsciously

into

hands

proposals starts at

part in pro-

the pressure

over

and

AlthouSh

do its

management," because

toward

development

orderly

—

resentful

vestigations * have ; indicated
its ' welfare of our employees is no
economic justification.
Moreover,
longer of primary concern to us.
there
should "be
adequate local All too often shop stewards and
cost-sharing to reflect local bene¬
grievance committees, through infits resulting from the project.
defensible tactions, have erected
Over the 50 years of its exist¬ an American version of an iron

one—individuals, business organi¬
and
local,
State
and
vitally zations,
fiscal year will be bigger than we interested in the orderly develop- national groups. As citizens and
anticipated.
Similarly,
a
large ment, conservation, and use of the as members of this Rivers and
deficit—in the general range of $8 nation's water and land resources, Harbors Congress, your continued
to $10 billion,
according to pres- The President has continuously cooperation can play an important
ent
tentative estimates
is in sought, with the cooperation of part in helping to assure that our
prospect for next year instead of other public and private interests, Federal investments in resources

Recession and Inflation

all be weighed against each other

rising expenditures. Therefore, with lower tax collections as
well, the deficit in the current

Solving the Problems of

^rani. Over the year^the redeial

-est.m ' -s. V1 navigation, flood
control, developments.and .related
irrigation,
From -/the
} ,v 1 R9()'e thvmiPh 1 Q^7*!**^f^^r>*

re¬

project authoriza¬

page

t '■

lor

mean

■

from

They account for the largest seg¬
ment of civil public works except
for the Federal-air highway pro-

♦

the surplus we had planned.

Continued

whole includes

specifically

Various proposals are by the Corps of Engineers and the
'" "i"8
Burtfu uf-,recl:aPf,tion1 ma,y weU
! ? re.f.h a billion dollar level, even

actions

under which

sound overall

* e unemP!oyed and to assist with

These

must

sponsibility to follow an orderly
and
legally
established
process

previous year's total except dur¬
ing World War II, when military

Y. ?imutes)» and various other annual construction expenditures

other

1 if} say more in a next few years. By 1960 and1 1961

fnr7h„ ^

that

feels

including

branch in these years over the budget

'hous^M^rosrams'rp6

contracting

ernment

Mr.

budget

In the 1959

civilian

Jbefore the Sputnik, cits
changes in emphasis
by

1959

projects.

housing
bill and the highway act. Authority has been granted to enable

Povprn

tor aetense purposes.

fold since the turn

one

in¬

changed the budget five preceding years. Recently, the
early signs of an Corps of Engineers and the Bureau
were - just
of Reclamation were directed to

enacted, such

...

resulted

step-up

than

mi.

billion., This

operation and maintenance of the

spending'dowVbelfw$?0 SfnvL^f and persistent

ress.

tial

various actions to help reverse it.
Substantial programs have been

throne-bout

ihen last fall, while we were
working on the 1959 budget, came
the Sputnik and increased awareness

cer¬

striking than the in¬

better

billion in the next fiscal year.
,

crease

unu-H

$4%

was

downturn

total

aral buildings, civil public works tures of! about

Pressure

totaling almost $72 billion. A
lot of pressure developed to cut
ment

pubbc works had reached more
than $2 billion. In fiscal 1957,.the

The

thp

years

£ tte Hme we prepared I^ridetoan orderij speedup of
We now their rates of construction in 1958,

great deal of in-

voiced

was

has

thfeountr^about FederaTbmlg- activities.
bark

Fifty

the 1959 budget last fall.

pair

Budget

in defense costs is the way
the current
economic

outlook.

resources.

Past

cost

aXmme equipment. The executive

specific^Uy

A year ago, a

which

setback

have

the budgetary situation the coun¬

aPProacn

crease

are

needs

Economic

economic

eyes open.

I want to detail

This

dohigit

but we are

security

tainly must meet.

whelmed

that

the

ditions.

to fight change or be over¬

pose

am0unt.

highway
construction.
are
This estimate is higher than any

fore recently requested $1.5 billion
in additional funds from the Conshifts
in., consumer
preferences, gress, and defense expenditures
inarkeC^Gfti,)dBic^wit4gl unfore- are now expected to be higher
seen requirements over and above
than the $40 billion estimated in
a
normally adequate cushion of the budget.
V;?:
'
reserves.
i
half Of .the vbudget
*
This is what has now happened going for defense, we are deterlnis IS wndl Ildb HOW XiappeilCU
uvivuov,
wc niv
ui-tvi

upon

tbig

later the annual amount for all

tlv

business, the best laid
plans are likely to be upset by

one

Harbors

and
fllJU

worl/acco'unting

private

at each

million

$40 million a year, with rivers and
for about

gQ^

past few years,

Since the

in¬

long-range estimate of

and outgo, and a

come

budget is
a

about half

By the early 1900's, when

harborg

developments thus far and
adding immeasurably to the pow¬

to be
reckoned with.
both

been

hadn t

which

t ake
taKe

w a y s

The

started, Federal
for
public
works

A,aixVJiaA

The

al-

may

1820's

1955, while spending lor military far exceeds the general growth
equipment of declining import¬ in national
production.
ance is decreasing substantially.//;
The upward trend is continuing.
Because of our efforts during

eeks

early

National ..Rivers
iUVCJa

luc

production quantities as rec
y
as
19.10, the first full fiscal y
alter Korea. Our spending in 1959
for missiles will be about lour
and a half times greater than in

conscientious¬

few

continu—the

for types of equip-

1959 will go

oped

budget't so
carefully and

amounted

Quarters of our
ment

the

ing to occur in our de ense pio- congreSs was founded, spending
grams. F or example, over:three- for pu51ic works came to about
m

if anyone had

expenditures

dollars.

little perspective

helpful.

bors program was

vxi

taking place and are

were

Budget for a very short while—a
bare two months, to be explicit. I
wouldn't have believed it possible,

•

Budget

about the time the rivers and har¬

dealing with nation's water and land resources.
+

new

Looks at Domestic

pump-priming pressures to lead to unnecessary military expen¬
ditures. He also reviews Administration's policies and program
x,

long time to

projects started. Let's
briefly at this portion of the
budget.
get

are

recovery

take

it would

look

accepted as inevitable now, ,we
stampede ourselves into hasty, ill-considered actions
add unnecessarily to our future burdens, nor allow

economic

though these pro¬
already at a high level,

programs, even

deficit re¬
sulting from dynamic pre- and post-Sputnik and domestic econ¬
omy changes. Mr. Stans points out that, even though deficits
for

bill in¬
proj¬
which did
not
meet
the
requirements
of
sound projects. The President dis¬
likes vetoing legislation.
But he
the

ects, it included some

and

Thursday/May 29, 1958

cluded; many* worthwhile

Director of the Bureau of

Federal Budget

While

provements.

large

STANS*

By MAURICE IL

vast

would commit the

A New Look at the Budget

(2400)

SAN
J.

Hannaford
fornia

with

Calif.—Don

FRANCISCO,

Hall

now

Street.

Pacific

affiliated

with

519 Cali¬
was
formerly

Talbot,
He

Coast

Securities

Co.

With EL F. Hutton Co.
(Special to The Financial Chronicle)

ATLANTA, Ga.—John L. Ken¬
nedy, has become connected with
E. F„ Hutton & Company, Trust
Pnmnnn.r

riarwce ?0

"Rl

i T cl

IB CT

' V

f».v

(2401)

Volume

187

Number 5746

The Commercial and Financial Chronicle

TV tells him whatV going on
You won't

those

any westerns or

odd-looking pictures

observer.
steel

see

ball

games on

of real interest

are

They tell him what's happening

pours

into

these TV

screens.

But

the metallurgical

the molten, white-hot

ingot mold which is completely enclosed in

One TV

camera,

camera

peers

inside the large, closed vessel into which the

gushing, and this pictur^ shows on the top screen. Another

whose picture appears on the

of the hot steel
direct this

it flows into

tricky operation

have these action

can

pictures right

bottom

screen,

shows the action

large ingot mold. The

men

who

follow the action carefully when they
at

the control panel.

BETHLEHEM

regularly casts ingots

casting" method. The
the volume of
causes

small

thus far

high-vacuum chamber.

hot steel is

Bethlehem

purpose

imperfections

200 tons by the "vacuum -

of the high" vacuum is chiefly

hydrogen which, in

are most

large

form within large

encouraging, and

our

eyes

masses

of steel. Results

old timer blink his

in wonder, for there is increasing evidence in the steel plant of

strides in

many

fields of technology.

Recognizing the vital role of continuing research,
new

reduce

development work continues.

Steelmaking methods today would make

great

normal atmosphere^ sometimes

laboratories

1000-acre

plant and general offices at Bethlehem, Pa.

STEEL

we are

building

mountain-top site overlooking

our

T/tg Commercial and Financial Chronicle
14

plan

loans to

For Railroad Industry
By DANIEL P.

President, Association of

program under the administration
of the Interstate Commerce Com¬

and

research

But

cently

bedrock

for every year since
the end of World War II, a total
billion

nation's

; our
r a

nsporta-

j tion

system."

The

railroads,

of the

one

several important transpor¬

indus¬

tation

Daniel

that

tries

Loomis

which

der

the peo¬

serve

year

nearly $14 billion in

13 years.

ple of America. But the flexibility
and
convenience
of
the
rail

of trans¬

business

the

portation is carried on. This need
has been recognized by students

transportation, and by public
method
of
individually
loaded officials, the latest such recogni¬
cars, combined with the economy tion being given in a report by
of moving these cars in mass beSenator Smathers' Subcommittee
ltween terminals, give the rail- on
Surface
Transportation sub¬
i roads
a
unique position in the mitted
on
April
30
last. This
transportation field,
report on "Problems of the Rail¬

severe

George

cause

of the situation.

constitute

should

program.

this

''V,

arc

often erroneously

described as

—

ernment
roads

Federal

the

roads

the

when

was

Gov¬

loans to rail-;

in making

were

operation after

returned to private

These loans totaled

World War I.

Extensive Hearings

Fi¬

Reconstruction

and

amounted

loans

nance

young

Carlisle Bargeron

California

had

The
the

from

down

come

member

that the
to be

was

As a result the pro-labor
of the

to $1,200,-

committee

simply went through
the
motions
in
questioning the
various witnesses who appeared
and con. Two exceptions were
the freshmen, Nixon and young

pro

John

They asked pene¬

Kennedy.

trating questions of the witnesses
them to brook.
It is interesting to note that both
men have, come far in politics and

and brought

together

being mentioned

are

Presidential candidates.,»
Nixbn

When

Chairman

Senate

the

uation would

not

Surface

hard to

un¬

and students of transportation.

It
of

conditions
derstand.
The fact is, however, is not the program of any one
is cited, however, merely to indi¬
that it is due to neither. Railroads these groups or individuals. It is
cate the slight degree of risk in¬
have
important and unmatched rather the result of study and volved in this
proposal.
advantages
nomical

efficient

use

materials

and

fuel,

and

eco¬

manpower

produce

trans¬

portation service. And just in the
years since the end of World War
II, they have virtually completed
a

revolution of motive power re¬

sulting

highly
efficient
doing more than

the

diesel locomotive
90 %

In the

of all railroad work.

the railroads "have put
more
than
800,000
new
freight cars, many of them
especially
tailored
to
shippers'
varying needs. They have im¬
proved' the alignment of track,
strengthened bridges, installed
20,000 miles of centralized traffic

same

years,

into

service

control,
which

built
are

push-button

marvels

yards

efficient

operation.
the

And

research

these

made

which

has

other

and

changes
today at an

possible is going

accelerated rate.

The first

build¬

ing in the Association of Ameri¬
can

Railroads Research Center

the campus of the Illinois Institute
of

Technology

was built in 1950.
building was added in
third one in 1957, and a

The second

1953,

fourth is planned for 1959 or 1960.
Tfis

spirit

but

one

indication

of the

study and

consideration

views

the

all

by the Subcommittee. It is based
on the Subcommittee's conclusion
that

the

general decline in the
industry is due to the in¬
tense competition of newer meth¬
ods of transportation, the govern¬

railroad

assistance

ment's

offered

railroads' competitors,

the

had

Jerry

Voor¬

Nixon is still blamed by the

over-regu¬

culties

are

which

are

attributable to matters

principally

under the

control of state and local govern¬

ments

and

ginning.

been

And today

trade¬

from

220,000-mile

proving

the

taxation.

ground

which the railroad system

address

by Mr. Loomis before
Pittsburgh Chapter of Delta Nu Alpha,
Transportation
Fraternity,
Pittsburgh,
Pa., May 12, 1958.

In
the

must

not

emergency

answer

long-range problems.
The Sub¬
committee, therefore, offers other
legislative proposals designed to

both

areas

the

Sub¬

the

concludes
be

found

areas

that
but

Federal

program

has

solu¬

recom¬

difference of $6,000

between the amounts which rail¬

which, while

will not establish the conditions

equality of treatment and

op¬

portunity which the railroads seek,
is nevertheless

definitely helpful

step in that direction.

52%, the railroads must earn more
than $12,000 in order to accumu¬
late $6,000.
As

action
recom¬

his

the

Already

has

smear

set

America

that he

the

knowing
would

was

ture

willing to involve his

This is certainly a
twist in the vicious game of

clear
the

did

information

what

agencies had

Senate

down

the

measure

lieving this situation,
encourage more

railroad

partially
as

well

facilities

and

the

modernization of the
railroad plant, the Subcommittee
necessary

recommends

lowed

set

that
up

railroads
a

al¬

"construction
on

page

campaign

think

has

graciously.

too

not

acted

en¬

It is quite
that we

say

have got to re-examine our policy
towards these people. The fact is

and

prosperity
on

States

our

oil imports

the investments of United

Steel.

Bethlehem

and

particular the two steel companies
have

built- schools and

roads

and

otherwise contributed to the Vene¬
zuelan economy.

-frequent

piece

our

propaganda ridden country that
have
given our money
to
Asiatic
and
European countries
but we have neglected our neigh¬

bors to

that

has

the south

us.

The fact

the

been

view

Export-Import Bank
twice reorganized with
helping Latin America

countries and it is also

win.

such

difference would

it make?

V-

•

■

'■

With P. W. Brooks
*:■

(Special to The Financial Chronicle)

VAUGUSTA, Me.—W. De Wolfe
Finch

has

affiliated with

become

P. W. Brooks & Co.

Western

Incorporated,

Avenue.

Joins du Pont,

Homsey

(Special to The Financial Chronicle)

}

Mass.—Stanley
Wolkowicz has joined the staff
du Pont, Homsey & Compariy,

SPRINGFIELD,

95 State Street.
J.

was

formerly

Co.

Roberts

Goldman, Sachs Adds ^
(Special to The Financial Chronicle)

BOSTON, Mass.
has

Aronson

Philip S.

added

the

Sachs & Co., 75

staff of Goldman,
Federal

—

been

Street.

ST.

LOUIS, Mo.

William E.

—

Kramer, Richard S. Slocumb and
Merrill

with

ated

affili¬
Lynch, Pierce,

Fenner

Locust St,

Smith, 511

Joins
T

Jaclyn Oertle

(Special to The Financial Chronicle)

ST.

LOUIS,

Mo.

—

fact that

Robert E.

Quest has joined the staff of Jac¬

Investments,

Oertle

lyn

7713-A

Brookline Terrace. Mr. Quest was

previously

with

Lynam &

Co., Inc.
)

that Venezuela has built its pres¬
ent

show-r
;If

would

showdown what

he has acted

In the matter of the Vene¬

tirely

Continued

think

treatment

dangerous

high minded of him to

re¬

rapid replacement

show¬

W. William Young are now

graciously towards the peo¬
ple who insulted and mistreated
I

the

country between the

right and left, and in such

most

zuelans

have

would

down in this

security

our

turns

and

make

Merrill Lynch Adds

the nature of the

and since his return

would

(Special to The Financial Chronicle)

out, he acted most
courageously in the face of humil¬

iating

sort of campaign

cook

reception he would receive.
.

please he doesn't
them. As their

from

clear is

not

What is not

come

in 1960 that
he made in seeking a seat in Con¬
gress
and
subsequently in the

One thing that is quite
that

trip.

for

his political strength
from the right of
Republicans. I hope that iri

and

same

and

political ends.

politics.

man

country in war to further his own
new

the

apology to anybody.

any

away

hostile

receive

spokesman, I believe, lies his fu-f-

that he deliberately went to Latin
treatment

that

upon

Helen

I admire

anxiety

get

with

placed with cars which cost $8,500. him.
That leaves

owes

center

•

the

Subcommittee

mended

is, this it

enthusiasm for research and test¬
*An

tions

be¬

the great

and

their

include

mends that these be sought locally.

have

railroads

nature

railroads

agencies. These roads have set aside in deprecia¬
problems of tion accruals to provide for re¬
commuter service in large metro¬
placement of the car and the cost
politan centers, the losses from of the new
]car—a difference of
which .impose a
serious burden $6,000 which railroads must find
upon
interstate commerce. It is for
every new Car purchased.
likewise true of another area-rMoreover,
because -corporation
that of inequitable state and local
earnings are taxed at the rate of
matters

ever

and

far has

has

politician

the

writers

What is more,
so

wave

American

proposal,

State agen¬ "furnish more substantial basis for
usually under .ancient and curing the basic ills of the rail¬
outmoded laws
and procedures, roads."
and failure on the part of some
Substantial Proposals
railroad managements to "recog¬
Among these recommendations
nize
changing conditions, times
are two affecting
depreciation .of
and tastes."
railroad equipment and property
The program is not one .that for tax
purposes. The importance',
deals completely with
all these of the level of depreciation
factors.
One reason is the Sub¬
charges permitted is highlighted
committee's
conclusion
that
in
by the fact that freight cars which
major areas the railroads' diffi¬ cost $2,500 are having to be re¬

methods

that

the

this

cies

committee

the
Subcommittee emphasizes that
temporary financial assistance to
making

some

reads

"Liberal"

last straw.

of the greatest abuse an

for

worry

what he has done and I don't think

because of his
treatment in Latin America, is in

popularity

taken.
In

lation by Federal and

investigation
and the testing of new devices and
marks

roads under emergency

Jerry
Gahagen
Douglas. He assigns this, accord¬
ing to these writers, to his imma¬
turity. Insofar as I know he hasn't
apologized for his attack upon
Alger Hiss.
That would be the

came

leftist

the

defeated
hees.

One

man.

Voorhees

conservative members

and

American

he regrets his attacks

and

experience

hands

Republican
leadership
Taft-Hartley labor bill

amounted to $64 million,
they were repaid, plus $104
million
in interest.
The second

gifts

mature

the House Labor Committee.

passed.

the v Mexi¬

"Liberals','
him, to make him as
a
much broader and

change
they say,

came

Congress

word

Delano

Mr.

changed

expropriate

when

first

hasn't
Franklin

encouraged

about the efforts of the

met

Getting back to Nixon, I

because

Nixon

guarantees, if we may

ment on its

judge

'SI

to the govern¬

of loss

risk

The

that this
"giveaway"

;

situation

since

properties.

politics.

contemplate

not

does

Subcommittee

the

but

condition

-»

cans

leftwingers, including the ADA,
000,000, made the railroads during
The program is
Transportation Subcommittee, to
the result of the depression, and were;: repaid for the campaign he made against
Voorhees
but more
so
for
the
describe them as being in a "de¬ hearings extending over 11 weeks
with $277 million in interest. It is.
subsequent
campaign
he
made
teriorating situation." If this de¬ in which 103 witnesses presented true that the
proposal now under
terioration were due in any large the views not only of all forms of
against, for the Senatorship, Helen
consideration is not that the gov¬
jdegree to inherent deficiencies in transportation but also those of ernment lend money to railroads Ga.hagen Douglas, a darling of the
so-called
liberals.
He
called
a
the rail method of transporting transportation users, agricultural
but only that it guarantee repay¬
people and goods, or to failure of associations, labor organizations, ment of loans made by private spade a spade and left no trick
the railroads to keep pace with
public regulatory bodies, govern¬ lenders. The government's experi¬ unturned in this campaign.
the parade of progress, their sit¬ ment departments, and economists
But Mr. Nixon, now riding a
ence with its direct loans to rail¬
i

policies resist this
they particularly resist
investments by United States en¬
terprises.
"V- i v

Roosevelt

working capital and inter¬ one for whom
est on existing obligations;': Such; he has greater
guaranteed loans would help pre¬ a d miration,
vent bankruptcy of those railroads
that is, in the
that are in precarious financial
great game of

istration

Smathers,

true

$1,080,000,000 and again they were
These railroads are, neverthe¬ roads" carries with it a recom¬
repaid, this time with $244 million
less, in financial difficulties—dif¬ mended program for improvement in interest. Public Works Admin¬
ficulties

think

| Senator

would

provide funds for operating ex¬

past experience of the
And yet there can be no doubt
government in making loans to
that the railroad situation is—as railroads, would be negligible. For
Senator Smathers said — both dif¬
example, in the early days, the
ficult and deteriorating.
What is Federal Government made loans
needed, the railroads believe, is a to six pioneer "Pacific" railroads.
revision of the public policies un¬ These loans—which, incidentally,

are

course,

but

1960. ; Y

internal

help and

The

there

investigation

their

much

penses,

in the improved materials
and
machines developed by re¬
search. Such investment has gone
on
to the tune of more than $1

scribed as "the

money

re¬

top

correspondent

tion

has

the

proceeds could be used to fir,
nance or refinance acquisitions or
construction
of
equipment
and
at other additions or betterments, and

Transporta¬

.Surface

nomination

The

ing is more in evidence than
any time in the long history
railroad achievement.

Nixon

Presidential

by commercial lending institutions
for a term not to exceed 15 years.

nevertheless, it is def¬
in that direction. Concludes that current
encouraging sign of better days ahead.

0 11

now

his political popularity and a vir¬
tual shoo in for the Republican

guaranteed loans would be made

by themselves are not enough to
keep
up
with national
needs.
There must also be investment of

mittee

the feeder,
and others. The;

airline programs,

equality of treatment and opportu¬

°represen tative

ported

chant Marine programs,

sought by railroads but finds,

of the rail¬
roads I take particular pride in
discussing a form of transporta¬
tion which the Senate Subcom¬
As

Vice-President

under the housing laws, the Mer¬

policies would improve the present serious railroad situa¬
tion. Mr. Loomis notes that legislative proposals, which he

helpful step
rising interest is an

established

already

procedures

By CARLISLE BARGERON

keeping with

mission would be in

tion

Washington
Ahead of the News

commercial channels. Such a

nary

industry's spokesman believes adoption of Senate
subcommittee's recommendations relating to public transporta¬

initely

From

needed funds on
terms
through ordi¬

reasonable

Railroad

nities

government guaranteed
aid temporarily railroads

unable to obtain

LOOMIS*

American Railroads, Washington, D.

reviews, will not establish

for

of this program

item

One

Signs of Better Days Ahead

Thursday, May 29, 1958

Loans

Guaranteed

(2402)

•

With Peninsular In v.
(Special to The Financial Chronicle)

ST.
rence

with

PETERSBURG, Fla.—Law¬
L..

Dee

is. now affiliated
Investments, 134

Peninsular

Beach Drive,

Nprth.

With Yarnall,

Biddle

PHILADELPHIA, Pa.—Yarnall,
Biddle & Co., 1528

Walnut Street,

of the New York Stock

members

Exchange

and

other

leading ex¬

announce that Charlton
Yarnall II is now associated with

changes,
them
tive.

registered

representa¬

Volume

187

Number

5746

The Commercial and Financial Chronicle

(2403)

available only for new construc¬
tion;-these plants would become a

Proposal for Federal Industrial

glut

the market.

industries
their
to

By FRANK G. BINSWANGER, SR.*

One of the country's leading industrial and commercial realtors
submits a far-reaching proposal for the Federal Government

for industry — similar in concept to the
FHA for private home owners. Mr. Binswanger's
plan envi¬

such

*'» A

to combat the recession than would

public works

widespread industry problem
has
been
developing for

lending

Which
many

has

years

critical

assumed

public

proportions, partly because of the
current

business

downturn

Other economic factors.
1

It is

how

jBut,

Federal

unlike

•

assets

asking

for

does

not

1958,

the

Government.

usual

estimated

Scheduled

$34

for

cated

that

the

ratio

their

plans.

$3 million

$4 million

result,

such capital expenditures
being sharply curtailed or
dropped completely. *, tf.

The

publicly held
funds.

sary

But.

the

and

companies have

medium-sized

place to turn.

Yet, companies of this size
resent

operate

such

"If these

our

its

succeeding

rep¬

constitute

firms

forced

year

the
cur¬

by guaranteeing

mortgage money

available to most prospective

The effects of industrial expan¬
sion are even more far-reaching.

for

modernization.

more tax revenue for states
communities, increased ac¬
tivity". in the construction field

plant facilities

increased

efficiency
economical productivity.
It

will

aid

firm

with

multi-plant

'necessary
maintain
allow
new

In
may
i

The

will

ulate

and

that

these

institute

*Mr.

taxables,
more fi¬

by,

the

works

ambitious

most

program,

ex¬

mortgages, with funds being

announced.

allocated in proportion to the total

number of companies, in the
financial brackets suggested.

Mr.

five

Department of
Herbert

decrease,

available

country fluctuates.

the economy

established to

agency
the

The

Street with A. C.

administer

of its balance

working

fund principle.

Granger & Company

revolving

on a

;

\ (5) To start the
from

drawn

Celebrates 60 Years

program

current

imme¬

Granger & Company, 111 Broad¬

current business

because

measure,

New York City, members of
York Stock Exchange,
May 26 celebrated their Sixtieth
Anniversary.
way,

appropria¬

tions for public works.
porary

the

tem¬

the

New

downturn, prior¬

L. C. Fisher Branch

ity should be given to plants in
areas

there

where

employment.
manent

Allyn & Co. in

1923.

could incur obliga¬

program

tions of up to 50%
each year,

the New York

Corporation.
Prior to that, he
was
Vice-President of Rogers Ss
Tracy, Inc. before their merger.
He began his career on La Salle

the total

budget
the

Burke

Hanseatie

empowered to recommend an in¬
crease,

committee

man¬

aged the Stock

Funds for such a program
would come from Congressional

with

Burke*

formerly

' <•

(4)

appropriation,

Ex¬

changes, as ,a
r e g i s t e red
rep resentative, Robert A.
Podesta, man¬
aging partner,

severe

However,

un¬

per¬

priority system is advo¬

ATHENS, Ala.—L. C. Fisher &
Company has opened a branch ofice
in
the
Gray-Holt Building,
the

under

direction

Turner.

Binford

is neither

offer to sell

nor a

solicitation of offers to buy

of these securities.

any

I The offering is made only by the Prospectus.
May 28,' 1958

NEW ISSUE

$25,000,000

The U. S.

mortgages for a
years at interest

of 25

now

important

Federally
be

must

guaranteed

available

construction,
an

industrial

stress

that

mortgages

for either

new

or the purchase by
firm of an existing

facility. In the past, when indus¬
trial mortgage money was plenti¬

ful,

there

tance

Binswanger's

Sen.

was

the

marked reluc¬
part of private
a

supply

funds for the
purchase of an
older,
existing
building. With industry engaged
in a migratory period, there are
an
increasing number of existing
facilities which are ideally suited

sources

First

Mortgage Bonds, 4% Series clue 1988

•

Dated May 1,

1958

Due May 1,1988

production
Russia

tries have

modern

ing

techniques,

and

other

Eastern

far higher

plant

percentage

facilities

rid itself of

obsolescence,

but

coun¬

than

creep¬

American

in¬

Copies of the Prospectus way be obtained from any of the several under-

dustry must be given adequate
financing to modernize and expand.
Under

writers only

in States in which such underwriters are qualified to act as

dealers in securities and in which the Prospectus may legally be

distributed.

this

proposal, the re¬
sponsibility of creating a health¬
ier
economy
is placed squarely
where it belongs—upon industry,
which

the

base

our

entire

economy.

The First Boston

the

form

taxable

Corporation

Merrill Lynch, Pierce, Fenner & Smith

Kidder, Peabody & Co.

Blyth & Co., Inc.

Salomon Bros. & Hutzler

A. C. Allyn

A. G. Becker & Co.

Coffin & Burr

Incorporated

White, Weld & Co>.

Stone & Webster Securities Corporation

Incorporated

corporate and personal income.

Historically,
industrial
firms
comprise the best credit risks in
the country.
The ever-dwindling
number of mortgage failures by
homeowners with FHA and VA
insured loans is testimony to the
fact '.that
insured
mortgages
given to average credit risks are
profitable comparatively risk-free

and Company

Incorporated

F. S. Moseley &

Co.

Shields & Company

Spencer Trask & Co.

Alex. Brown & Sons

G. H. Walker & Co.

W. C. Langley & Co.

Laurence M. Marks & Co.

Robert W. Baird & Co.,

Goodbody & Co.

Incorporated

Laird, Bissell & Meeds
Elkins, Morris, Stokes & Co.

Butcher & Sherrer^

Singer, Deane & Scribner

First Southwest Company

Newburger, Loeb & Co.

investments.
In

summation,

propose

the

for continued

following steps be taken imme¬
diately by the Federal Govern¬
ment to help the nation's economy
in this critical period and on a

gage

long term basis:

use.
Yet, if a mort¬
insurance program were

Price 100.874% and accrued interest

leads the world in

ernment

Appalachian Power Company

other

To Cover New and Old Facilities

objectives
I propose

Stock

Works

Such a program would be selfliquidating and, in the long run,
would return a profit to the gov¬

proposal was made
Styles Bridges (R.-N. H.), Sen.
Joseph
C.
O'Mahoney
(D.-Wyo.),
and
•Carl F. Oechsle, Deputy Assistant to the
-Secretary
of
Commerce,
Washington,
D. C., May 14, 1958.

Public

prevailing rates.

long-range
program
of mortgage insurance
for industry, similar in concept
to the FHA, which will fill the
gap
between
the circumscribed

Mort¬

be empow¬

rates commensurate with realistic

that the Federal Government im-

mediately

would

insure

con¬

facility

control
costs and
competitive status; or
company
to
undertake

accomplished,

maximum

construction.

Industrial

Federal

program

ered

order

'...
established to reg¬

agency
a

the

for

gage

appropriations

agency.

multi¬

operation

single

financing would be translated

by this committee into larger i or

space to relocate in a single
floor building; help a firm which

has

Increases or dein the demand by industry

smaller

story

solidate

sured

Midwest

and

pansion.
' '
'
(3) That the only firms with
assets of $5
million or less be
eligible to receive Federally-in¬

in general, there is another
important factor to be considered.

for

general business upswing,
industry itself, it means the
ability to take advantage of mod¬
ern
techniques
which,
coupled
modern

buildings,' modernization and

Street,
bers

the New York

facturing companies, and allied
firms, for the construction of new
plants, the purchase of existing

omy

propose

the

mean

duced

creases

with

Than

employment,

public

ing the program.

•and

and

further

appropriated to the agency guid¬

•labor;

m e m

gages be made available to manu¬

that a com¬
mittee representing industry, fi¬
nance and
government be estab¬
lished
to. rdgulate the
amounts

«•

demand

Salle

mort¬

proposed anti-recession measures.
the program for con¬
While it will benefit labor, comrelocation,
expansion imunities and the national econ¬

under
struction,
and

the insurance
total, it would,

limiting

effect, make at least twice' as
much money available to indus¬

reach unprece¬

greater

•

treas¬

productivity and
activity
and
consumer
spending than could ever be pro¬

Details Advantageous

insured

such

nancial

try

means

That

for industry.

Better

national

...
.

(2)

insurance

mortgage

to one-half of the

Consequences

program

buyers, the building indus¬
as its pros¬
perity mushroomed, helped the

to establish

the

for

does for private home con¬

(2)

home

used instead
ury

the FHA guarantee pro¬

struction.

try has prospered, and

♦

re¬

gram

Insured

The funds thus diverted to in¬
(1) It would stimulate the flow
of
funds
from
private- sources dustry would produce many times

dented heights.

being allocated for "pump prim¬
ing" public works projects be

expansion, : such an agency
would accomplish two things:

With the guaranteed FHA mort¬

economy

the government to insure 50%

and

economy.

gage

company

gram, I strongly urge that a por¬
tion of the Federal money now

the revolving

plant construction, modernization

much

••

the

expansion, new building and
similar
activities, the repercus¬
sions will be felt throughout our
•

CHICAGO, 111. — Herbert J.
(Joe) Burke has joined Cruttenden, Podesta & Co., 209 South La

the total mortgage commitment..

each

balance

that

believe

tail

facilities, whether
new
construction or existing
structures,
should
not
exceed

fund becomes established.

industrial might.

are

mort¬

will

(4)

quired by industrial firms for new

companies

insured

who, of necessity, might
apply for several mortgages in a
relatively short period.

50%

backbone of

limit

erations

American industry.
Such

number

is permitted.
provide protection for
companies with multi-plant op¬
This

.units of the country, and account
,for 48% of the dollar volume of

the

should

Cruffenden, Podesta

guarantee mortgages to
industry for a maximum of 25
at prevailing interest rates;

years

diately, the initial funds could be

";/• j y:
There

(3)

$1,999,999
$2,999,999
$3,999,999
$5 million

sur¬

applying for insured mort¬
be given temporary prior¬

ity.

fol¬

would be drawn from a

50%

of the total industrial

84%

gages

labor

H. J. Burke Joins

lished to

neces¬

small

plus

Summary
(1) That a r eaeral Industrial
Mortgage Loan program be estab¬

cated.
Congressional appropriation. The
agency
responsible for
admin¬ 300,000 square feet
per plant, and
istering the fund would be em¬
^.should be buildings that can be
powered to incur obligations up used
by more than one industry.
to
half
the
total
appropriation
This advertisement
In order to secure the neces¬
the
first year of
its operation,
sary funds to begin such a pro¬
then

float stock

can

bond issues to raise

where there is

areas

less

money

program

Many large corporations which
or

gages

million
$1 million
$2 million

kre

are

the

financial

categories
equally eligible for insured
mortgages. However, due to the
current business conditions, it is
suggested that plants located in

with

number

en¬

are

Assets of:

Yet, small and medium-sized
companies
have
found
it
ex¬
tremely difficult to get financing
out

The company must be

proposed

carry

the

Y'-

that all industries which fall into

available
most needed, I
money be allo¬

are

should

the

funds

make

industries operating
lowing categories:

new

plant construction, modernization,
expansion or relocation.

such

that

company,
be used as

(2) No permanent priority sys¬
be put into effect, so

less.

tem should

firms

insure

they

suggest

billion

spent

where

help,

subsidization.

of the Small Busi¬

$5 million

eli¬

the

manufacturing process,
field, such as research
development.
:

and

further

program

government

entail

should

allied

or an

industrial

for

ance

a problem which I believe
requires
direct
assistance

from.- the

(1)

private financing.

would

that

guides to eligibility:

•

powers

scope

Aside from the normal financial

designed specifi¬
cally to provide mortgage insur¬

and

thesefactors

Administration and available

ness

pro¬

of
insurance program, there

gaged in
program.

the

stability and worth of

modernization, and ventures the prediction that this
will, do

for Timiting

ceiling

be adopted to establish
gibility of a company.

Believes this would affect 84% of entire industrial community,
which produces 48% of its volume and yet finds it extremely
difficult to secure adequate financing for construction, expan¬

the

several standards

are

long-range industrial mortgage insurance program for
manufacturing industries with assets of $5 million and under.

program

new

addition to

posed

sion and

facility to enable them
a

mortgages
to. purchase existing structures.:

insurance program

sions

sale

visions for guaranteed

"financial Gordian knot" by establishing a mortgage

old

build

the

upon

many

plant, or relocate
in an existing building, the effec¬
tiveness of a mortgage insurance
program would be seriously ham¬
pered if it did not include pro¬

President, Frank G. Binswanger, Inc., Philadelphia, Pa.

to cut

rely

Since

Interstate Securities Corporation

Suplee, Yeatman, Mosley Co.
Incorporated

Saunders, Stiver & Co.

Schmidt, Poole, Roberts & Parko

Cunningham, Schmertz & Co., Inc.

Sutro & Co.

The Commercial and

Financial Chronicle

Thursday, May 29, 1958

thcy said the ad had three to four
times the normal reading of an ad

Producing Company are now about 1.9 trillion cubic
a net increase of 400 billion cubic feet during the
past year. In addition, the company in conjunction with other
operators, owned a sizable interest in the Savanna Creek field in
southern Alberta.
Initial production in this field is to be sold to
Westcoast Transmission for export to the Pacific northwest mar¬

Natural Gas

feet, reflecting

Public

Utility Securities
IIOLLISTER*

By KENNETH

operates

extensive natural

pipeline system extending from northwest Texas through the
wheat and corn growing states of Kansas, Nebraska and Iowa and

gas

extending northward into Minnesota and minor portions of South
Dakota.
The company owns two subsidiaries: Northern Natural
Gas Producing Co., which is wholly owned, operates as an explora¬
tion and development arm of the system, and Permian Basin Pipe¬

majority owned, which gathers and transmits gas for the
and New Mexico. Approximately
70% of sales is made to other utilities for resale and the remaining
30% is delivered to industrial customers for direct consumption.
Among the major cities served by customer companies are the
Twin Cities of Minneapolis and St. Paul, Minn., Des Moines and
Dubuque, Iowa and over 380 other medium and smaller-sized com¬
munities. Total population served is about 2,800,000 of which about
77% use natural gas for house heating. While the market area is

its rates $6.5 million annually in order to offset higher
costs and to increase the rate of return from 6% to 6*4%.
This

application of course will ultimately be subject to the outcome
of the Memphis decision and may have to be refunded. In recent
however, the company has signed contracts with all of
customers for increased gas deliveries beginning October 1958.

months,

agreements relating to rates specify that the tariff
file with FPC at that time shall be the effective rate. As the

Terms of these

line Co.,

Northern system in west Texas

company docs not contemplate seeking any increased rates
Ihose which were sought in 1957, the Memphis decision

predominately agricultural, there is an increasing influx of indus¬
try which is giving the economy a desirable balance. Some of the
more
important industrial operations in the territory are food
processing, the manufacture of cement, ceramics and gypsum,
fabrication of farm implements and chemicals, fertilizer and
glass plants.
Growth of
recent

years,

the

has been below the national

area

average

but has been steady. In common with most other
a fairly rapid population shift toward the
heating saturation, the

there also has been

areas

urban

areas.

Because of the relatively high

should
that year and

only revenues collected between August of

affect

beyond

October 1958.

For

earnings record of Northern Natural Gas in recent years
has been quite impressive, rising from $1.38 for 1954 (adjusted
for a 2 for 1 split in April 1958) to $1.87 for 1957. Of the latter
figure, however, approximately 27C is subject to refund if the
Memphis decision is upheld. Assuming the present rates are per¬
mitted to remain in effect, earnings for 1958 are expected slightly
more to offset the dilution resulting from a 1 for 8 common stock

offering last January. As expansion plans beyond this year are
uncertain, valid estimates of future earnings cannot be made at
this time. The company has followed a policy of recognizing in¬
creased earnings with higher dividends, the last increase to $1.40
annually being made in November 1957. At the current price of
29}2, this stock yields about 4.75% which seems reasonable for a

extend its lines to

the

200

over

serve

new

Dakota

and

vide Northern Illinois Gas Co. with 50 million cubic feet commenc¬

ing in the fall of 1958. This sale, if approved by the FPC, will be
made near Dubuque, Iowa, and will provide the company with a
new high load factor market.

During 1957, the

company

spent $50 millioii, and the subsid¬

iaries about $22 million. As no new communities were added, the
of the construction expenditures were directed toward en¬

bulk

larging the gathering system, connection of new gas wells, devel¬
opment of underground storage and addition of compressor capa¬
city. The level of construction expenditures for 1958 will depend
on FPC action on the company's proposal to serve new areas, but
is tentatively estimated at about $42 million. An additional $22
million will

The researchers

asked the

then

that the country
faced ten years of steadily rising
prices and to make their selec¬
people to

tions

assume

the basis of that assump¬

area

Texas

and"

Approximately 90% of requirements are purchased
from independent producers and the remaining 10% from the pro¬
ducing subsidiary. Owned or controlled gas reserves exceeded

whether

20 years.

over

Reserves of Northern

they could
such

bonds

the fact that

tually

dis¬

any

see

period.

Despite

the researchers vir¬

gave away

in an asset of fixed dollar
value during a period of inflation.
Quite obviously, these people did
not know that common stocks rep¬
one

the

investment

which

resent

Substituting for Owen Ely Mho is

lose

the market

when

securities

you

can

by States

and

arranged alphabetically

Cities.

Addressing charge $7.00 per thousand.
Special N. A. S D list (main offices only) arranged
Just as they appeared in "Security Dealers."
Cost

addressing N

We can
a

small

S. D. List, $8.00 per thousand

also supply the

additional

list

gummed

roll labels

charge.

Inc.

"Security Dealers of North America"

—

REctor 2-9570

—

New

York City

and the

General Motors, I.B.M.
Telephone Company, pre¬

sented for

week "The How to

one

Invest Show." Over 100,000 people
attended that show.

York's

New

Grand

tion,
at

kind of

show in miniature

Investment

our

Center

Sta¬

Central

presenting much the

are

same

Currently, in

right

Information

the main floor of

Since this exhibit

the station.

was

opened in March, 1956, over three
million people have visited it.
Of course, it is obvious that peo¬

ple

who

invested before
That's true even of

never

need

help.

those

who

why in

have

invested.

That's

booklet and ads we

our

con¬

offer the services of
Department.
We

that

our

they

lution—whether they want recom¬
mendations

for the investment

given amount of money,

view of

entire

portfolio,

re¬

or an

opinion on an individual security.
Every year, the number of peo¬
ple who write to our Research

Department
offers1 has

grown.

result of these
This year it

and

just

should also be evident that

things like these:
waited

out."

to find this

years

•

curities."

should
"I

to invest.

What

I do?"

again in their lifetime."

that

Several people even wrote

dismal

most

one

People

they want to

know

rest

can

firm

our

first

ten years ago.

published

Know

That ad,

Business" occupied a fullin ithe New York "Times"—
a solid page of newsprint.
As far
as
appearance was concerned, it
was probably the most forbidding
ad ever to be published. The copy
consisted wholly of questions and
Bond

about securities— What

securities?

are

What

bonds?

are

with

have

had

never

relations,

contractual

any

Cun¬

ningham and Walsh in New York.

the virtues of long
copy versus short copy have been
a matter of controversy in the ad¬
vertising business practically since
the day the serpent offered Eve
the apple in the Garden of Eden.
As you know,

Because this

est

ham

ever

and

about the long¬

was

Cunning¬

published,
had

Walsh

its

own

re¬

searchers the next day ask people
in New York whether they had
read

the

New

York

day

our

searchers

and

"Times"

whether

and

recalled any ad.

tioned

is vitally

important to
of doing business.

Yet

investor

whole

our

Here, happily, our self-interest

the

they

any one men¬

advertisement, the re¬
then

checked

est, for business needs millions of
stockholders.

new

This is the only way to build a
healthier
business,
a
healthier
America.
u

tI-

NailllliaCK VlCS-Ghlltail.

produced the ad
the readership,

Jerome

of the public

advertising agency

which

en¬

About This Stock and

page

answers

supplied by

two shares

one or

individual.

each individual

that

Of N. Y. Stock Exch.

Other Evidence

interest in this advertisement was

Know

selling just

coincides with the national inter¬

have

put this away for my
children because I don't expect to
see

rich

feel

we are

to grow tremendously

likely

way

have $5,000

not

of stock to

majored in economics in col¬
lege, but I never understood se¬
"I

Another evidence

the story of one advertisement

Nammack,

Gov¬

of the New York Stock Ex¬

ernor

change

and

partner

the

specialist firm
of

Sprague

and
m

been
V i

has

elected

e-Chairofthe

man

Board,

been

has
an¬

nounced.

He
Ed¬

succeeds

ward C. Werle

who

was

elected Chair¬

effective

man

May 19.
Mr.

mack,
been

and

paragraph by paragraph.
Later,
Cunningham and Walsh sent me
a copy of the report in which they
How

W- Nammack

has

member

1933,

jerome

a m-

57,

since

of the

Exchange

specialist since

Governor since

1946

1953.

What's the Stock Exchange? What
a

broker do?

you

bear

What's

market?

buy stocks?

bull

What does it

observed
was seen

cost?
When

25 Park Place

Electric,

those requests the American people. Admittedly,
in telling this story we have a self-¬
ordinary people,
in their letters to us they said interest, but parenthetically, it
from

came

same

outlook if it
saving grace in
may
not
about securities, but they
to know.
Specific evidence
for

market?

Herbert D. Seibert &

City, and with the help of eight
other
corporations like GeneraL

bulk

the

But

unin¬

totally

discouraging

does

Publishers of

Want

situation.

which

obtain elsewhere.

reprint, but we thought the in¬
of that offer -— stated jp

clusion

they owned stocks but they franlc-

those

for

almost

would

This

that

There are approximately 9,000 names In the United

could

titled, "What Everybody Ought to

States and 900 in Canada, all

for

People

some

than

they

formed—financially illiterate.

know

publishers of "Security Dealers of North Amer¬
ica," we have a metal stencil for every firm and
bank listed in this publication,
which puts us In
a
position to offer you a more up-to-the-minute list

Jy never understood what it was
problem then, is one of how
they owned until our ad explained
expand securities ownership it to them.

want

ing reprints. Frankly, we didn't
know why anyone who spent a
half hour wading through 6,000
words of text would want to have

Our

the

Dealer-Broker Addressing Service

forms

purchasing power.

weren't

vacation.

few

hope that their dollars would not

and
*

34th St.
York

New

the question was

advantage in owning government

11.8 billion cubic feet at the end of 1957, and appear
ample to sup¬

port the company's sales for

Avenue

put very small type at the bottom— will exceed 75,000 people — peo¬
that
way,
some
of the people might at least give us some clue ple who write to us and tell us
thought about it a little more in¬ to readership. To our very consid¬ all about their individual finan¬
telligently and as a result common erable astonishment, within the cial situations in the knowledge
next several days after publica¬
stocks got a vote of 23%.
and with full confidence that this
tion we received 5,000 requests for
Finally, the researchers asked
is the only way we can give them
The letters came to us
the most penetrating question of reprints.
intelligent help.
from bank presidents, from the
all. They asked the people, again
This, then, is the story of stocks
assuming we were faced with ten presidents of corporations, from and bonds as we
try to tell it to
school teachers, college professors.
years
of steadily rising prices,
When

tion.

tied up

Hugoton field and the Permian Basin

Park

and

only 13% named corporate bonds.

million of debentures and $16 million of preferred stock were sold
to finance -the construction program and early in 1958 $22 million
of common stock was sold. No additional common stock sale is

New Mexico.

took over the Armory at

biased suggestions about their so¬

America Needs More Stockholders

the answer, 56%
of the people questioned thought
the problem over and blandly an¬
swered no. They could see no dis¬
advantage to having their money

of the

about our

Merrill Lynch

1925,

tell
will simply
write to us about their problems,
we
will give them objective un¬

again be spent for exploration and development of gas
and oil properties and miscellaneous additions and improvements
by the subsidiaries. If the full expansion program were to be ap¬
proved by the FPC, total expenditures, including those of the
subsidiaries, would aggregate about $114 million. Last year, $55

anticipated during 1958, but authorization to undertake the full
construction program would undoubtedly necessitate the sale of
equity. The consolidated capital structure as of Dec. 31, 1957,
adjusted, pro forma, for the sale of common stock in January 1958
aggregates $404 million, divided as follows: funded debt 55%, pre¬
ferred stock 11% and common stock and surplus 34%.
Gas is purchased under long term contracts in the Panhandle
and Hugoton fields in Texas, the Kansas and Oklahoma portions

business.

people

communities in Nebraska,

Minnesota. Because of a competitive
application of another pipeline, however, hearings before the
FPC have been delayed and no new towns connected. Additional
service was provided, however, to customers that currently pur¬
chase gas from the company. Most of the communities that the
company proposes to serve are of moderate size, but the major
cities of Superior and Duluth, Minn., are included in the applica¬
tion.
Recent developments indicate that the hearings on these
applications will continue for sometime and much of Northern's
proposed expansion program may be delayed for another year. An
interesting non-related development concerns a proposal to pro¬
South

Iowa,

other evidences, that

are

want to know

Research

has sought authority to

company

There

people

stantly

of this quality.

stock

Continued from page

the past two years,

securities.

The

major portion of future growth of Northern Natural Gas will
depend to a greater than average extent on service to new towns
and areas.

spite of itself and succeeded
only for one reason: Because
people wanted to know about

.•to increase

its

this story because it's
succeeded

I tell you

the story of an ad which

application with FPC

August 1957, the company filed an

Northern Natural Gas owns and

of similar size.

this field

kets, but Northern Natural Gas has a call on gas from
above the requirements of the Westcoast contract.

Northern Natural Gas

(2404)

the

"Times"

that

our

by half of the New York
audience

and

that

was

few ads, even those with
readv tor nubHeation.

decided

to put a line at the bottom offer¬

"very

appeal¬
ing human interest illustrations,
equal this record." In summary,

Stearns & Co.
Roland
the

New

York

and

Eugene

form

Stearns &

to engage
ness

Open

member of
Stock Exchange,

Stearns,

Greenberger,
Co.

will

of June

in the investment busi¬

in New York City.

Volume

Number 5746

187

The Commercial and Financial Chronicle

(2405)

The
A.

THE MARKET... AND YOU
By WALLACE

speculative

Smith

Memphis

aspect

the

famous

Once

the

roads

turn

the

corner

decision which eral

gas

followed by a sharp cut¬

was

costs.

selves

pipeline projects
pending clarification of this

Railway's boom should

[The

views

article

expressed

while other items,
pany

dend

from stretching its
sprinkling of divi¬ string to a fourth new record

casualties, sagged

bit this year.

obviously, but for the general
stock market it was
largely
Glass
a case of
backing and filling. products
£

on oc¬

since

containers
are

Thatcher

The rails and utilities

for

food

the mainstay of

Glass

the

these

days

in recent

company

casion

decision

would

do not necessarily
those

controversial court decision, time coincide with
Selected favorites did better the horizon to
They
keep the com- Any reversal in the Memphis fiChronicle
this week

including

those of the author only.]

Gallagher Joins
Vance, Sanders & Co.

ing

oil

Mr.

companies

have

had

them-

little

sus-

make

his

clouded

through continuing
preferred. The.
^ There was some good action projections are, however, that
in cases where the short in¬ final 1958 per share earnings
terest was
large, notably U. S. could come to around last
Steel which posted its own year's record figure even if
1958 peak. Lorillard, where all of the almost 78,000 preShort Interest Beneficiaries

the shorts

gested,

are

was

also

bit

con¬

given to small and
price fluctua¬

inconclusive

tions,
tion

however.

What

devoted

was

shares centered

❖

The apparent end to wide¬

spread tax cuts to prop up the
economy
was
pretty much

ignored by the market, despite
earlier hopes that such action
would also shake the market

gards

its

times

the

were

than

oils, with

not

some

}

prug shares still have

a top
recession-proof, lmproved-earnings. section although the demand for them
had quieted down a bit. Sterling Drug, with a yield of 4%,
has had relatively less of a
runup than some of the others
as

foreign

traders

unrest

cautious

There

at¬

growth

related type

issue that is
the

near

the head of

anything

a few years
ago, will
filling the classrooms from
kindergarten
to
post
graduate

And this will be so, de¬
spite all the books and all the
equipment which we have paid
for in the past ten years.
Even
courses.

of companies doing portantly on
despite the recession. ders, chiefly

So far the business downturn
remote

last year was
year

new

Thatcher

ments and there is

nothing

ap-

ternational

markets.

The

placid member of the oil section, however, is Getty Oil
which has been unable so far
this year to stretch its range
to

much

President

the

coming into

there

past

were

tales of simplifying its corp0rate setup and indirect

holdings

Skelly

Tidewater. But

now

Oil

and

that pre-

yminary

steps

toward

the

furnish

study

halls

use.

will provide

favorable

Investment

the

and

market

With Dean Witter

time.

strikes

Schwartz

Witter

New

Co.,

Mont¬

members

and

Pacific

to Staff

FRANCISCO,

Thomas

Kindel

conservative in¬
might' well
where permitted

(Special

SAN

inherent

Shaw, Hooker

The Financial Ckponicie)

FRANCISCO,

pressure

0perafing

centered

which

the

The

recession

stage.
snuffed

bit,

was

to go in for auto-

output gen- mation in yard and mainline

operations to trim high labor

—

Alfred J. LaCoste and Douglas D.

Street.

McConnell
ated with

K. L. Provost Adds

have

Montgomery Street,
SANTA ANA, Calif.—Fred Mit¬
chell has been added to the staff
of K. L. Provost &

members of

the Pacific Coast Stock
Both

Company, 325

associ¬

become

Shaw, Hooker & Co., 1

were

Exchange.

formerly with A.

Nowell & Co.

North Broadway.
■

proposed

new

issue

500,000

AUTOMATION FUND, INC.
CAPITAL STOCK
(par value $1)

offering price $10 per share
(in single transactions involving less than $10,000)

objectives:
The Fund's investments will be concentrated
the

common

principally in
engaged in missiles-jets
Fund will emphasize possible long-

stocks of companies

and automation. The
term

growth in its selection of securities in these fields.

These shares will he offered to the

June 17, 1958 through

a group

public commencing

on or

about

of underwriters headed by the

undersigned.
A

registration statement relating to these securities has been

filed with the

but has not yet become effective.
These securities may not be sold nor may offers to buy be accepted prior
to the time the registration statement becomes effective. This advertisement
shall not constitute an offer to sell or the solicitation of an offer to buy nor
Securities and Exchange Commission

shall there be any
solicitation

sale of these securities in

any

State in which such offer,
qualification

sale would be unlawful prior to registration or

under the securities laws of any

such State.

•

preliminary prospectus on request

railroads

expenses

1 i f.

Reynolds & Co., 425 Montgomery

their favorite. The logic was

an<* direct. Since War

stocks.

common

Two With

with

risks

the

assume

Calif.—
now

being
this

Trustees

in trusts

conservative

(Special to The Financial Chronicle)

SAN

by the prudent man rule, provided
the beneficiaries are in a position

the

Coast

Stock Exchanges.

Reynolds Adds

It is suitable for investment

vestments.

with

now

use

Street,

York

interesting

speculative

FRANCISCO, Calif.—Wil¬

Over-the-Counter

by individuals interested either in

(Special to The Financial Chronicle)

SAN

even more
The
stock
is

record.

particularly

Dean

dealers

Association of New York.

liam

five points.
*

investment

gomery

industry have been depressed off
in line with auto

and

traded

General completed.

Motors. And sales to the auto

erally.

needed

classrooms

now

years

since

its third straight
records in ship¬

the

largely on dieselizaautomotive or- tion which, by now, is largely
from

will

ly known in New York area fi¬
nancial and investment circles, he

dreamed of

■

plies, A. O. Smith relies im-

list

better

.j,

children,, which
our
population
proportions never

tered on the purely domestic
companies not involved in in-

being
proaching record earnings.
given by market students to
,,11 the
Thatcher Glass which is an Apart from its oil well sup- ^
a

The

of
accelerated

has

headquarters

candidate for

the

Outstanding as has been the
history of International Textbook,

Where

into

I feel confident that the next few

this

considerable

was

tention of

making

over

education
way

the

that
end
have a c t u a 11 y been
started, their lift seems to be
missj11g. Getty's published
figures arc. to a degree, alwhich could indicate it is
wayS
understated since the
among the issues that have full
equity in earnings of its
yet to join in fully on the affiliates is not used for the
drug popularity.
computation. Last year's offi¬
%

its

impact of. this will be

postwar crop

wholesale representative, working

now with

interest

some

periodical runups in Getty on

Drug's in Ton Role-

find

Eastern Seaboard territory. Wide¬

preferred is convertible
common.

for

money

cen-

although

overseas,

then

cial results, for instance, were
Sterling so far this little more than half the acyear has ranged from slightly tual
equity in the various
group.
under 30 to a shade over 40 profits. To that extent Getty
at best, others, such as Parke is
Foods in Demand
generally listed as an unoil equity.
Also
As has been the case for Davis, have roamed over a dervalued
range
of nearly 30 points, mitigating against drastic
some time, some of the
per¬
sistent demand centered on Sterling, as the others, is be- market action is the fact that
the food shares and General ing projected to another new the company is not a cash
in earnings this year payer, its dividends in the last
Foods was able to stand out as high
which would leave more than few years being confined to
a star
occasionally. Foremost
a dollar a share over the pres5% in stock. So far the simpliDairies, third largest in the
ent dividend which is an in- fication has eliminated a cumdairy lineup, was the languid
dicated $1.50 including a ulative preferred in Getty and
item despite a yield of well
above 51*2% and a record of year-end extra. The 1957 pay- the next involves an exchange
out had risen to half again as for Mission Development
earnings quadrupled over the much as that
paid as recently shares, which would bring the
last decade. In part the reti¬
as 1953. With the dividend so
large Tidewater- holdings in
cence over Foremost stemmed
well covered, Sterling is auto- Mission that much closer to
from fears that the very thing
matically a dividend increase home. Eventually a consolidathat contributed to the vast
prospect.
tion of the diverse bundle
jump in sales and earnings—
a
n
«
*
a t
could set up a new petroleum
a
A Deflated issue
long series of mergersgiant.
might bring antitrust action
More of a case of a well
❖
*
*
to require the company to dis¬
deflated issue is A. O. Smith.
There was only momentary
pose of some of the companies Even with an
upturn in pipe interest in railroads and the
it had so busily acquired. In
orders already underway
companies associated with
any event, it was one of the which could make a favorable
them although General Railmore handsome yields in the
change in earnings for the way Signal had its backers
food division.
company's final fiscal quarter, wh0, 0n a longer range basis,
«
-•:=
*
the company is far from being still clung to high hopes for
the

lethargy. The lag¬

converted,

were

into 2.4 shares of

role

The

atten¬

the group.

out

ferred shares

tobacco

others

conversions of

Best

The full

industrial average lagged just First quarter results showed 4ained investment interest in at the firm's New York office, 61
a
below its high without
comfortable increase over view of the many uncertain- Broadway, and will serve as a
any
apparent intention of soaring last year in volume while the ties
above the line in a rush.
per-share picture is a bit and

Security

felt in the decade of the-'60s.

Gallagher,

will

purchase of books.-

who formerly
was manager of the Mutual Funds
Department at Kidder, Peabody &

Co.,

bound

page

any

of the
presented

are

from

The

this

undoubtedly
spur demand for pipe importantly and change the com- Wm.
pany's outlook drastically. In
any event, the present price
William G. Gallagher of New
is a slash of about a third
York has become associated with
from last year's high and its
Vance, Sanders & Co., it has been
5.3% dividend is above announced by Henry T. Vance,
senior partner. /
average.
'
' :

mustered
enough years broadened its participaspotty strength to nudge both tion in the field. Earlier it was
averages to new peaks for the noted mostly as the nation's
The
year but—for a change—the main maker of milk bottles, selves

Continued

Gen¬

resume.

back in

STREETE

them-

A copy

of the Preliminary Prospectus may be obtained from your
or dealer or by writing the undersigned.

local broker

IRA HAUPT A CO.
Members New York Stock Exchonte

and other principal exchanges

III BROADWAY, NEW

WOrth 4-6000

YORK 6

The Commercial and Financial Chronicle

for a large segment of the
working population. The specter
of loss of job and loss of income
from
job becomes a; disturbing
outlook for middle-aged workers.

tory

The Search for

Thursday, May 29, 1958

Existing Solutions

■

longer a secret that
solutions exist for this insecurity.

little known facts about

some

in discussing briefly some of the
economic insecurities existent in our

Social Security programming

individual

causes

Dean Graebner also suggests some of the plans
society and individuals have been employing to accommodate
themselves to, or attempted to do about, these insecurities.
Author discusses various causes of insecurity, ranging from
accident and retirement to business cycles and inflation, and
compares

those who

those who "want to be secure in opportunity to
"worship the golden calf of economic security by

ment.
Some

government edict."

■

Systematic savings, life insurance
and annuities represent excellent
solutions for this problem.
Each
of these plans, however, requires
full
measure
of
personal plans
that require time and self-denial.
Present consumption must be re¬
duced in order to guarantee in¬
come
for consumption in retire¬

system.

recent book on to accommodate
Security" these insecurities;

The authors of a

Social

and

themselves to
that is, what

will

their discourse with two has society attempted to do about
quotations. The first one is: "The these insecurities?
best way to
Nature and Causes
security is to
Now as to the nature and causes
marry
the
of economic insecurity.
It is not
boss's daugh¬
easy to define economic insecu¬
ter." The sec¬
rity briefly. But perhaps we can
ond sugges¬
identify it as this: economic inse¬
tion
reads:
curity for the individual is first of
"The best se¬
all one
that involves a loss or
curity for old
threat of loss of income. This loss
age is a large
can be either relative or absolute,
family." From
or it could
be in the form of an
readings
in
additional expense. The primary
news papers
cause in most instances of this loss
and popular
of income is either the destruction
magaz i^nes,
of income-producing property or
one
certainly
Herbert C. Graebner
logs 0f a job.
We kllOW also
realizes that
that such loss can be permanent
all through

advocate a pro¬
government
aid
for
upon reaching retirement.
before

con¬

the second type
that is, where the

insecurity,

cident

borne

expenses

take

an ac¬

If such ill¬

ill.

become

accident

care

who have suffered

persons

ness

additional

but

cease

must

brief

and

culminates in premature death for

income

the

producer, serious fi¬
problems usually result.

nancial

Undoubtedly each of you is well
of economic and social dis¬

aware

that

locations

death
It

usually

accompany

economic

significant to

and

producer.

that

fathers and mothers

are

evidence of

being deeply
concerned with this type of inse¬
curity.
I could cite research
studies among consumers which
giving

mention also,, however, that the

This

fessional methods, such labor un¬

questionably is socially useful.
Numerous

commonly

the

stated

could

reasons

evidence of the produc¬

inflationary trend. . It
perhaps is the most insidious and

tivity of this group. I would direct
attention
to
just one which is]
summarized

insecu¬
rity with which most people are
confronted today.
Closely asso¬
ciated with this type of insecu¬
rity are the problems created by
the ever increasing planes of liv¬
ing.
When planning the amount
of income needed, future changes
in living standards should be an¬
ticipated and planned for.: Per¬
haps the cost Of high living claims
as many
victims as the high cost
of living.
^
.
...
,
'
Social

Security Act

•

consideration

Security
social

Act

and

security.

Social

trends in
of the best

the

One
I

articles

recent

the

have

tive."

seen

this subject appears

in the Winter,
1957, issue of the Journal of the
American
Society
of Chartered
L fe Underwriters. It was written
by Mr. Benjamin Kendrick. One
quotation
sounds the following
warning: "There may be grounds
for worry, with respect to corpo¬
pension plans, life insurance,
disability insurance in the
thought that continual expansion
of
the
compulsory Government
system may progressively dimin¬
ish the

tary
There

in which these volun¬

area

mechanisms
can
operate.
may
also be ground for

about whether social secu¬
rity will be expanded to a level
where it will definitely' interfere
with incentives for savings, for
worry

the

"incen-l

word

•

One of the noblest instincts of

vide

for

the

and

healthy

is his

man

himself

desire

financial
his

future

family.

To have

with

economy.

pro-|

large

of individual freedom of

measure

action, economically and politi¬
cally,1 it is imperative ? that ihe
majority -of citizens be encour^
aged to seek and achieve financia"
security privately. The quest to
this type of security will serve a
.

incentive

become

cient

for

individuals

effective

effi

and

producers of the goods and,

services which

are

vital to im

proved planes of living.
This is so important because thVi
incentive to increase productivit
is the only sound
basis for the
government
guaranteed security
which

humanitarian

any

group
the rela¬

will make available for

tively smaller number ofunfor¬
tunate citizens, who depend upor:
public or private charity. /
•
"Security" Connotes Different
Ideas VYY;-o
;;

rate
and

•

normal

Any discussion of the Search
for Security is incomplete with¬
out

separation arises from acci¬
dent or sickness, we find that not
only does the income frequently

have or temporary in nature. We should

persons

numerous

pursued one of these policies and,
I suspect, have gained some degree
of economic security. At least this

this

job

the ages

discuss

With respect to

elimination.
called

shrinkage

income

persons

clude my remarks.

begin

periods

gram
persons

"Economics

ing dollar which a man has accu¬
in order.to take care of

mulated

the most difficult type of

Underwriters

American College of Life
Philadelphia, Pa.

dean reviews

Life insurance

Security

GRAEBNER, C. L. U.*

By II. C.
Dean of The

(2406)

v/a

The

word

"security"

connote.'

different ideas to different

people

Most

people want to be secure ir.
They do not offer tc
sell their souls for a guaranty thai
opportunity.

will

someone

throw

"bread

anc

into- their

windows eacl
morning. They know that there i:
some
catch to that.
They know

honey"

that

such

program can easilj
job loss may not always be involved with income loss..» For indicate that family heads recog¬ investment, and for work — and degenerate into a system of eco¬
Y'
generally
v/ith
the
expanding nomic slavery.
may be true of the first sugges- example, .an individual may be nize the terrifying hazard they
Again and again, after freedon
tion; I am not at all certain that injured and yet be able to con- face. Our educational program, in productiveness of the American
has brought opportunity and soma
having a large family today gives tinue his work; but the injury schools, colleges, universities—in economy from which all the Na¬
degree of plenty, the competen
one any security for his own old
he sustains may cause him .to in- various advertising campaigns, tion's economic security stems."
a

various medical costs. Like*he head of a family may
may sound, I believe they do in- suffer a l(^s of his income because
dicate that the problem of insecu- of mjuries$md Occidents to memFacetious

suggestions

these

rity is a problem with which a
great many persons are confronted.
Furthermore,
like
so

problems that are so uni-

many

versal, numerous quack remedies
are

suggested

solutions.

like to limit my dissomewhat.
I would like

should

cussion

to suggest that we do
in

not include

J361,8
his family.. As the teim
1S commonly employed today, econamic insecurity would, embrace
fh such cases, involving income
|oss °J additional expense or the
^oss of property.
Where job separation is the fac-

ot several

in question, any one

additional causal factors may be

involved. Here are some of the
the dimensions of P°sslhle causes lor the loss ol

consideration of this sub-

our

ject several of
the security problem, such as the
anthropological, the legal, the

and.
the sociological problems of insecurity. In each of these it is interesting to note that the economic
component of the security prob- n°mic causes.
the

political,

Xem

psychological,

of a 30b:
<}) loss of job arising because of
old age; (2) loss of job arising out
?£
eAu and/or sickness with
death as the extreme case; (3) loss
°*
arism§ from outside eco-

income due to the loss^

important.

always

For

where

situations

job

the

example; the possibility of unem- separation arises from old age, it
"ployment gives many people a is interesting to note that prosense of insecurity. Now obviously
grams designed to overcome this
this insecurity is primarily
one type of insecurity do not necesof economic dimension. However, sarily
have as their goal the
such unemployment may have continuance of the individual in
serious psychological

implications

with the individual, and certainly

from

know

that

experience,
unemployment

past

protracted

also may have very
cal implications, as

serious politiwell as sociological consequences for society
as a

whole.

that

ourselves

our

first limitation

going

are

the

direct
impli-

economic

cations of the search for security,

Another limitation which I feel

compelled to set up is that we will
refrain from dealing with questions related to national

national security insofar
matters

involve

relations

the states and among the nations.
Our

plan, then will be to limit
to the categories of in-

ourselves

dividual economic insecurities
existent

system.

our

upon

reaching old age arrange for

will

discuss briefly some of the causes

the

Sixth

adelphia,

Annual

Pa.

Dean Gra.W b.f.r.
Brokers

The

Forum

Forum, Philwas
jointly

are

Retirement's Problems
financial distress at retirement has

become

acute

re-

cenf

decades, largely because of
industrialization and urbanization,
In

death

premature

loss

due

the

bread¬

job

due

accident

temporary, private insurance has
offered sound programs of finan¬
cial

security

based

private

upon

insurance. The fact that the public
is interested is reflected in the
vast

growth

programs in the past
Here

insurance

such

decade.

cans

for

care

comments about this development
before I finish.

Business Cycle Induced

Insecurity
typical

■

example

of-.the

third classification which is listed

tions

are

bound to

practice of industrialization
we have, quite incorrectly,
I believe, accepted the idea that
workers and managers lose their
ducers

economic

magical

some

th°U®h

pro-

chrono-

Al-

70.

thoughtful persons

&nd ITlUCn reSGarch—attempt to
gO

COUllter

Separation
reaching

economic

evidence

this

Concept,

the

from

the

job

Upon

certain age is manda¬

are

re-allocation

capital and human
of

fact,

fluctuations

the

occur.

resources

changes

the

of
re¬

de¬

effect,
consumers are changing their dol¬
lar votes for one thing in place
of another
it may be housing
consumers.

programs,

tion

automobiles

instead

vacations

educa¬
or

any

number of combinations.

.v.?.*'.I

popular with the American* people.

this

can

type

best

prepare

insecurity?

for
One

method

certainly would be to
develop various skills and abilities
so

that

one

can

shift

from

type of economic activity to
other
of

with

the minimum

one

loss.

(5) Essentially
the O.A.S.D.I.
system is now on a pay-as-you-go

/'Vl/'

'; 'V-

(6) Unaer present law, O.A.S.D.I.
tax rates will increase

by 70%., by
(on $4,200 ceiling wage, em¬
ployees will pay $178.50 compared
1975

at>.present). The in-."
creased receipts will be needed to
meet the rising costs of the pres¬
ent benefits provisions.
For lib¬
eralized benefits still higher taxes
will be required.
(7) There is serious danger that.
Social Security in the U. S. will
$105.00

There

another

area

in¬

people, and that is the one caused
by the reduction in the purchas¬

edict.

all

too

man:

the

cycle seems to be fron
bondage to spiritual faith; fron
faith to liberty; from liberty1 t<
abundance; from y abundance t<
selfishness;
from
selfishness. t
cases

There

over-expanded.

the

This is the routine

in countrie

where people

have bartered thei
independence for government se
curity—and in the end they hav
found themselves deprived of bot
—independence and security. ->
•"* *

Professional activities in teach

ing people how to plan their p\
financial security
is helping t
save Americans from the erodin
effects-

feudalism

and

*■

twentieth-centu

paternalism whic

forefathers shook from thei

our

feet

when

America

they; emigrated

and

United States."

thes

established
'

threat of ultimate disillusionment.
How Secure Is Social Security?

Tucker

Anthony Day
Absorbs Elmer Brigh

earnest, objective study of
Social Security trends might well
lead
one
to
ask
the
question,
-

"How

secure

Social

Security?"

The base

is, of course, the produc¬
tive capacity of the economy and
the
willingness of tne working
of

segment
taxed at

the
tax

population to be
high enough to pay

our

rate

beneficiaries

receipts.

tative

type

out

Assuming
of

current

represen¬

government,

the

BOSTON, Mass.—The securiti
underwriting and brokerage fir
of

Tucker, Anthony & R. L. Da
State
Street, has announc

that the combining
with

and

efit formula. We have experienced

the benefit. Is
possible that Congress may at
some future
time feel compelled
it

reduce

benefits?
us

the

amount

might be

such

proper

Before

closing

discussion, I

Co.

will

former

Anthony

continue

Bright

offices

Horace O.
H.

nam

operat

in ..Prov'

Bright and Alexand

Bright have been admitted t
as

Tucker,
also

limited partners.

Anthony,

1892,

social sagnificance of the
forts of all whose activities

founded
offices

operates

should like to comment briefly on

Boston and New York

ef¬

becam

dence, R. L, and Haverhill, Mas

for the firm

ponder this question.

business

Bright

the Tucker,

under

the size of the ben¬

effective May 26.
-The combined firm will operat

to time

upon

of its busine

securities

the

Elmer

Congress will determine from time

the

security which is running rampant
today
in
the
minds
of
many

and manj

(4) The American people want apathy; from apathy to depend
social
security than they ence; and from dependency hac"
now have..
v, -•: ;• y
to bondage. ' v
1
•

an¬

amount

unfortunate, grow

covetous;

from the hard road 0
freedom to worship the goldei
calf of economic security by gov¬
turn away

•

only increases in

How

and

—

instead

sin¬

whole stable

(8) Social Security is extremely

advocated a program of govern¬
ment assistance. I will have a few

The

the

ernment

gle program but. is

some

themselves, have

world¬
a rapid

YvY

basis.
;

who
question the willingness of Ameri¬
however,

also,

envious

(2) Social Security is not

separa¬

illness

Social Security is
wide and is expanding at
pace.

well

basic facts about

are seven

Security:

(1)

full

Likewise where the
tion

Social

winner.

our

ih°S;°redBaSk anl^GoTdon S^MiuS f3Ct remajns that Compulsory

Agency of Massachusetts Mutual Life Ineurance
Company.

power of
meeting the

economic

Here

life

creative

the

hazard

mands

logical age like 60-65

address

sponding

insecurities

economic

not created,

individuals

employing

efforts

insurance in

ment,

effectiveness

been

public
life

the accumulation by the individual of a fund so that when job
separation does occur at retire-

of such insecurity and also suggest
some
of
the
plans society and
have

effective

underwriters—all1 have played an
important part in educating the

such

these

among

•

his job. No longer do the pro- above, namely, economic causes,
the situation where
grams set up a cultural pattern is usually
whereby the children or the rela- unemployment is brought about
fives take the retired person in through business fluctuations'. At
to live with them. Rather, modern this very moment we observe
programs aimed at alleviating the evidence of this type of insecurity.
problem of income loss from jobs In a dynamic economy, fluctua¬

inter-

the

and

cur

agei

City and i

are

Rochester, N. Y., Hartford, Con
creation, Manchester and
Nashua, N.
conservation, and systematic liq¬
uidation.
If the work
of these pSpringfield and New Bedfor
in

the

persons

field

estate

accomplished

pro¬

Mass.

•

-r

Volume

187

Number

5746

Trie Commercial

and

Financial Chronicle

(2407)

Municipal Bond Club
Annual Field Day
The

Annual

Field

Trunk line highway obligations offered

by syndicate managed
jointly by Blyth & Co.; Smith, Barney & Co.j Lehman
Brothers; Halsey, Stuart & Co.; Drexel & Co.;, Harriman
Ripley & Co., and First of Michigan Corp.

and

Day

election of officers of the Munic¬

ipal

Bond

will

Club

be Jield

of
June

York

New
13

Westchester

Country Club and
Club, Rye, N. Y. Reserva¬
tions
should
be made
prior to.
June 2 with George W. Hall, Wm.
E. Pollock & Co., Inc., General
Chairman, indicating choice - of

BJyth & Co. Inc.; Smith, Barney *
&'Co.; Lehman Brothers; Halsey,
Stuart & Co. Inc.; Drexel &
Co.;
Harriman Ripley & Co. Incorpo¬
rated, and First of Michigan Cor¬
poration are joint managers of the

lobster

group

steak

.William

dinner.

for

First Na¬

Durkin,

tional Bank of Chicago, New York

City, is handling the sale of Mu¬
nicipal Underwriters & Traders
Trust Shares.
A

special car

Train No. 268

will leave Grand Central at 10:25

ajn. V Eastern

Daylight
Saving
rTime; for the convention, and will
leave
Rye,
returning
to • New

York, at 10:20

p.m.

provide

about

270

Feb."

1959,

for

3.40%

Mutual

the

cost

construction

and

and
in

highways ■ in
various
locations
throughout the state. These proj¬
are

secondary

Highway Fund,

Zuanich,

corporated,

Calif.—

Jr.

now

Fund Associates In¬

506

Montgomery

Street.

vehicles registeredA sufficient amount

the state.

principal

system,

motor

oil

With C. M.

and
'

bonds., I

interest
\

pay

DENVER,
Colo.^—Francis
J,
Ryan is with C. M. Hathaway

these

Hathaway

(Special to The Financial Chronicle)

ably appropriated by law to

which, with continuous construc¬

FRANCISCO,

Martin

with Mutual

of these funds have been irrevoc¬

part of the Federal-aid

and

SAN

gasoline and motor fuels

Incor¬

(Special to The Financial Chronicle) "

from

consisting, of the proceeds of

taxes

re¬

Associates

With Mutual Fund Assoc.

separate fund in the State Treas¬

ury

construction of 13 state trunk line

ects

Highway Department

Fund

porated, 1871 The Alameda.

appropriated to the

the Motor Vehicle
a

the

1979-82 maturities.'-The group was

T/^/'v^yv1,

State

proceeds from the sale of
bonds are to be used to pay

for. the* primary

- ■

from moneys

com¬

JOSE, Calif.—Marion W.
Kelley, formerly with Walston &
Co., Inc., has joined the staff of

tions of the- state, but their prin¬
cipal and interest are
payable

due

(Special to The Financial Chronicle)

SAN

245

bonds, which are rated A
by Moody's and A-l by Standard
& Poor's, are not general
obliga¬

The

members

those

about

With Mutual Fund Assoc.

The

bination of coupons, a net interest
cost of 3.30732%.
Y
/ /• *

on May 27 offered an issue
$100,000,000 State of Michigan
4,. 3, 3% and 3%% trunk line
highway bonds; series I, at prices

with

mitted; of 100.00253 for the

of.

yield from

state

awarded the bonds at competitive
sale on a bid, the sole bid sub¬

which

to*

the

miles of highway.

the

Beach

tion, should be completed in ap¬
proximately three years. Stated
generally, this $100,000,000 will

;

Company, 1575 Sherman.

A:#V

/Scheduled for the day area golf
tournament "with prizes for -low
'

member; low

gross,

low

guest;

gross,

net, member; low net, guest;

lowest

net

longest

each

score

foursome;

nearest-the-pine;

drive;

and

pay-off, involving the I. B. A.
handicap system.
-TY/'v/'YY y
Also planned for the outing are
a
tennis
doubles
tournament;
•

bridge tournament; horseshoe
pitching contest, softball game;
swimming, etc.
.One copy of the Bond Crier will
be included in each envelope dis¬
,

tributed to

members

and

guests.

Additional copies may be ordered

through William Simon, Weed en
Inc., New York City, at $1

& Co.,
per

copy.
Members

Committee

the

Field

George

are

Day
Hall,

General Chairman.

;

John C.

Committee:

Chairman's

Fitterer, Jr., Kuhn, Loeb & Co.
\ 'Announcements
Committee:

^William
liam

William

McKay,

Blue

List,

Chairman; Wil¬
Hall, Jr., the Blue List;
S.
Shanks,
the
Bond

/Publishing

Co.,

Buyer.

Arrangements Committee*.: Ed¬
Byrne, Phelps, Fenn &

mund' C.

Chairman;

Co.,

C; J. Devine &

Rand

John

THIS

Large,

YEAR

Co.; Wilson D. Lee,

& Co.'

Committee:

Finance

William

M. Durkin, First

National Bank of
Chicago, Chairman; William D.
Muller, Halsey, Stuart & Co. Inc.;
William
E.
Sjimon,' Weeden &
CO.' '
•Prizes and Venture Committee:
Theodore P. Swick, White Weld

THE

TWO

Co.; Chairman; Alfred J. Bianchetti, J. A. Hogle & Co.; Francis
B. Devers, Kidder, Peabody
&

Co.; Franeis P. Gallagher, Jr., W.
n. Morton & Co., Inc.; Edward J.
Meyers, Laidlaw & Co.; Charles
V.

Smith, Clark Dodge & Co.
Sports Committee: Jerome J.
Burke, Blyth & Co., .Incr, Chair¬
man; Donald Breen,
Glore, Forgan & Co.; Davis Kales, Wood,
Gundy & Co. Inc.; Edmund G.
O-'Leary, Eastman Dillon, Union
Securities
&
Co.;
Donald
C.
/Stroud, McDonnell & Co.; Alan N.
Weeden, Weeden & Co., Inc.
i
Daily
Bond
Crier:, Berger
Egenes,
Merrill Lynch,. Pierce,
Fenner &- Smith,. Editor; Leon¬
ard Bucci, Bond Buyer; Joseph G.
Cross, C. J. Devine & Co.; Francis
D.
Devers, Kidder, Peabody &
Co.; Brenton W. Harries, Blue
List; Eugene E. Kelly, Jr., Loeb
Rhoades &-Co.; Wilson- D. Lee,
Rand

Co.;

Edward

Wells, Inc.; Frank J.

Murphy, John Nuveen & Co.; Ed¬
mund G. O'Leary, Eastman Dil¬

lon,

Union

Securities

Co.;

Goodbody & Co.;
Shanks,
the Bond

James F. Reilly,
William

that

SYSTEM

BILLION

doing this because

arc

confident

are

growing America will

need, buy, and

use more

service tomorrow than

telephone

Wherever there

buildings going

We
ice

arc

doing it to improve

further

even: more
sure

make

and

the

convenient.

will stimulate

than the average in

This

we are

plumbers, electricians,

the post-war

years—

any year.

the economy

spending

way

this

nesses

In addition, the

flows out to other busi¬

money

stimulates the economy

whole- country.

only if they can expect
the money they

reasonable earnings on
risk.

means

business too for

keeps the road to

tric, its manufacturing and purchasing

pushing ahead—begins with

unit, bought from 33,000 firms through¬

that Americans want

out the

ing service at prices which allow

country. Nearly nine out of ten
arc

small

fewer than 500

businesses, each with

employees. This

expect to buy about

of the

To go

tion,

nearly

ahead with

our

■

'1..

1958 construc¬

telephone progress—and the ad¬
to

all that

good and improv¬
a

fair

This is the way of

life which in

our

country has stimulated
raised

national

strength. As long

Carroll & Co.,

Thomas M.

Equitable Building.

our

live

by this principle, the future of the tele¬

phone is almost limitless in

in the last six months.

•

as we

billion dollars of

new

capital

Obviously, in¬

possibilities for service to

FREDERICK R.
—

jobs,

living standards, and built

Carroll Co. Adds

connected with H.

invention,

nourished enterprise, created

(Snoo.'a1 to The Financial Chronicle)

now

our

faith

our

in the Bell System have raised

Buyer; William E. Simon; Weeden
& Co.. Inc.: Chester W. Viale, LI

DENVER, Colo.

from

comes

profit.

year

billion

from other industries.
'

F. Rothschild & Co.

Carroll is

profit

progress open

vantage

•„

ever.

savings to

others.

dollars worth of goods and services

Our goal, as I have said, is to serve

better than

will continue to entrust their

vestors

thousands of other companies and

again

of the whole country

you

many

FACILITIES

Good service at reasonable
Our

of these
A stimulus

telephone

new

THAN

workers in those companies. Last year
the Bell System through Western Elec¬

use.

highest in

NEW

jobs of mainte¬

up, or

our serv¬

telephone

These 1958 expenditures are higher

and close to the

are

there is work for local builders,

nance,

carpenters,

today.

PUTTING

DOLLARS

painters and

Mevers,

Laidlaw & Co.; William H. Moser,
-Andrews &

BELL

KAPPEL, PRESIDENT

AMERICAN

TELEPHONE

AND

TELEGRAPH

COMPANY

you.

new

The Commercial and Financial Chronicle
20

Thursday, May 29, 1958

(2408)

from in 1930. The

Ait Economic

Program for
More Than Temporary Success

solution down this road.-

By GEORGE G. IIAGEDORN*

lengths to which

might be driven are so fan¬
tastic, and the prospects of success
so
poor,
that only the utmost
desperation could justify seeking
we

Tax Reduction

Associate Director of Research
Association of Manufacturers

Anti-

as an

Recession Weapon

recommending

proposed
antidote to this recession.

and

deficits

treat

expansion in

monetary

the latter is

The NAM has long

thorough-going reform of our in¬
come tax rate system.
This would
involve
reductions of corporate

market forces to provide economic balance
private capital formation to provide growth.

physician can diagnose an
ailment and discuss possible treat¬
ments, even if he is unable to
predict with confidence the erratic
day - to - day fluctuations in the
patient's fever chart. The Ameri¬
can

suffers from certain
chronic
difficulties

economy

underlying

which have been with

for

some

which be¬
gan last year is one phase in the
working-out of those chronic un¬
derlying difficulties, and it can be
correctly understood only in that

problems,

problems

our

can

of costs,

pressure

We have two choices in dealing

this situation.

with
do

something

First,

can

reduce

the

ex¬

whatever

costs

This

puts us

in perpetual

inflation, recession,

danger

com¬

bination of both.

(2) A tax system which impairs
both
the
incentives
for
capital
formation and the sources out of
which

formation

capital

financed.

has

This

can

serious

con¬

in regard to our pros¬
pects for economic growth.

sequences

two

These

problems, and their

implications for fiscal policy, will
the focal points of the discus¬

which follows.

sion

stroying effect of uneconomic cost
increases, in which case the best
inflation.

The basic

of the tendency

cause

ductivity,
costs

and hence for labor
increase, is the power

position

organized labor has at¬
tained in our society.
Since that
problem is not the subject of these

hearings, I will

it, but
it must always be recognized in
the background of current eco¬
nomic developments.
In and of itself, the effect of
any increase in costs is to restrict
markets.

It is

pass

over

elementary prin¬
product or serv¬
ice becomes more costly you are

ciple that if

your

very likely to sell less of it.
Of course, the restrictive effect
of increased costs can be offset
in various ways, and that is where
fiscal and monetary policy comes

in.

The net effect of relying upon
these offsets is inflation.
•
>
.

Ypu

might view

history during the
as

race

our

years

between the

economic

since 1940
restrictive

effects of rising labor, costs and

•
'

that

monetary
expansion
can
move
ahead, but labor costs can move
ahead

faster.

even

likely

seems

that, if this is the course we
choose, the pace of the whole
process
must
continuously
ac¬
celerate.

that

fiscal
be

Once

and

becomes

clear

policy

monetary

"to whatever extent

used

necessary" there will be

very

little incentive to resist whatever
cost increases

this

end

must

chaos

form

some

that

The

demanded.

are

accelerating
one

economic

can

process

detail.
The
ent

recession

stantial

would

market

little

place

resistance

increased

the

costs,

and inflation thus went its merry
way.

year

ago,

economists

were

for

the

about

year,

"push of costs"

was
or

due 'to

the

"pull

be further

taking

cause

action,

for hesitation in

the

primary

pur¬

of which is to enlarge those

pose

deficits.

by Mr. Hagedorn before
Subcommittee of the Joint

Economic

May

Committee, Washington, D. C..
1, 1958.

and

reflec¬

in such

excesses

idle.

true

that

this

But

ital

that

than

our

in¬

should

cap¬

than
indication
that we have too many people.
Unemployed facilities and unem¬
ployed manpower are both the re¬
sult of the impairment of markets
by cost rises.
we

unemployment

others—the labor market.

have,

peded in its task of providing the
basis for economic growth, by a
system which confiscates the
sources of capital and reduces the
incentives for saving.

Effects

Fiscal

that

Spending

Cure

For Recession
is

doubt

way
it could
would be by a

that

experience
is

understanding
of
the
problem.
Even if our knowledge and our

Perhaps

some

cases,

to cus¬

the prob¬

all

between

and

1948

1956,

warns

that,

still nine million

were

"enough." It wasn't until 1942,
annual
expenditures
had

when

pre-depression

level, that excess
unemployment disappeared.
indication

what

might be letting ourselves in
if we placed our major re¬
on

way

government spending as
out

And

our

present

dif¬

starting from
in

base of

it can relieve the pressure, and
thereby improve business condi¬
tions, only by raising prices.
It
is impossible to separate the in¬
flationary from
the
anti-reces¬
sionary effects of fiscal measures.

(1) Strict government economy
—expenditures limited to those
necessary for ordinary government
functions.

Curbing of labor monopoly

(2)

—impose the same restrictions as
imposed

are

The
race

inflationary - recessionary
brought about by rising costs

capital con¬
billion n

One

(3)
rate

Reform of the income tax
system—the Sadlak-Herlong

Bill embodies the methods we be¬

problems in trying
devise policies to promote eco¬
growth,
and
to
balance
against other objectives, is
have

ards by

realistic

which

stand¬

growth objective
may be set. Merely equalling past
rates of growth cannot be consid¬
ered satisfactory when
potential
enemies may be doing much bet¬
ter.
The only conclusion is that
of

rate

below
within

our

growth

the

their

is satisfactory

maximum
free

attainable

enterprise system.

wouldn't

This is

consumers.

probably

want

method
it

and

use

wouldn't work

here

We prefer to rely on in¬

anyway.

dividuals and businesses to devote
a

part of their incomes,

own

structure of income tax rates most

should be considered
minimum program of rate

reform.

the

underlying

rates

economic

Much current economic discus¬
sion

seems

that

assume

simply avoid depressions and re¬
cessions economic growth will be
assured.

other

But this is hot

keep

so.

our. manpower

productive

resources

Even

and
at

level reasonably close to full em¬

Recommendations
The

ing

which

lies

behind

ommendations

allocate
current

our
uses

output

and capital

between

formation.

Our current tax system seems al¬

designed to insure that very

symp¬

than tem¬
•

Steele, Haines & Co. :
Succeed Fauset, Steele
Pa. — J. Barr
joined Harry J. Steele
forming the firm of Steele,

PITTSBURGH,
Haines has
in

Haines

Co.

continue

the

ess

originally
established
1946

Mr.

Steele and his;

partner,

late

Joseph

offices

firm's
will
to

H.
The

Fauset.

continue
located

the

First

National Bank

Building.
J.

Haines

Mr.

has had

names

oarr

long

experience with securities and in¬
vestments
having worked
as
a
security analyst with the Union
Trust Company of Pittsburgh for
nine

years

after graduating from
University. During

Princeton

War II he

World

Air Transport

Statistical

served with

Command
Control

held

the

Chief
at

the

in 1946, he

Lieutenant-

.rank

and

time of his separation
Colonel.

Following

his

Mr. Haines spent

the

Guaranty

military service,
three years with

Company

Trust

York, and for the past nine

he has been associated with

Counsel,

Inc.,

its

regional Vice-President. '

the

rec¬

Justo Ruiz Joins

National

J. R. Wiliiston & Beane

Association of Manufacturers. Due
J.

consideration has been given to the

Wiliiston

Beane,

115

aspects of the situation which are
peculiar to the present moment.

Broadway, New York City, mem¬

These

change, have announced that Justo

have

been

the

underlying problems of which they
are

the

sees

current

this

reflection.

for modifying the

position it has maintained in the
past.
Fiscal

policy should not be

as a

means

balance wheel

the economy,

redistributing

re¬

or reg¬

nor

government
expendi¬
providing economic bal¬
ance, we should rely on the forces
of free competitive markets, sup¬
ported by a non-inflationary mon¬
etary policy. For growth, we must
rely on private capital formation.
It should also be clear that this

reflect

Ruiz

with

its

Mr.

New

has

York

become

Stock

Ex¬

associated

Foreign Department.

Ruiz,

native of Havana,

Cuba, was formerly with Merrill
Lynch, Pierce, Fenner & Smith,
having spent eight years in its
Havana office and the past two
years

in its Brooklyn office.

Inv.

income.

be simply to provide revenue for

not

the

necessary
tures. For

does

ber

analysis, the NAM

reason

that all

are

current

only program which

tended to explain the basic think¬

attitude

$70

ailments,

porary SUCCeSS.

Fiduciary

foregoing discussion is in¬

ployment, the rate of growth still
depends on how economic forces

most

toms. It is the

offers the hope

The function of fiscal policy should

growth.

their

than

rather

deal

recommendations

These
with

years

ulator for

attainable

,re¬

duction goals

New

assuredly has this effect.

that

be falling far below

Its

be followed.

should

lieve

securities

the

garded

may

or com¬

investment

Standards for Economic Growth

is not the only major problem we
face now. There is also the danger
we

industrial

mercial monopoly.

$35

result

government
spending
instead of the $3 billion we started

about

60%.

This squeeze between costs and

over

remember
a

rate

that the net gain in our
available capital
is now a very
narrow margin.
year,

while the dollar total of corporate

with the cost side of the squeeze,

gov¬

over

current

by their
choice, to saving and invest¬
ment.
Still, we had better strive
to eliminate any condition which
margins. The evidence that this
has been going on extensively is impedes or deters them from mak¬
a
choice.
The present
the fact that the dollar total of ing such
not

and

1930,

billion

the tendency for cost
be passed

unemployed. In other words, tri¬
pling the expenditure rate was

our

increases to

Federal

liance

have put too much

prices is

sole

our

there

the

sumption

urges

also be¬

are

The Russians devote a substan¬
timing were perfect, this neat so¬
lution would be impossible since tially larger part of their national
inflation and recession are simply: income to capital formation than
different aspects of the same con¬ we do. They do so by a program
of austerity forcibly imposed on
dition.

one

the spending side of
budget amounted to
$3 billion. By 1939,
it had risen to almost $9 billion

for

start

they

But this is a mis¬

inflation.

The Problem of Economic Growth

slightly

before

measures
cause

one of the factors which
depressing business at present.
Since fiscal policy does not deal

program

This

accomplished

be and

and

reduced
restore full employment

taxes—to

un¬

spending — provided we
used enough government spend¬
ing. The trouble is that we don't

the

measures—

and then abandon or reverse these

our

ernment

spending

sales increased by

only objective were to put the
employed back on a payroll,,,

this

fiscal

use

econ¬

used up at a rapid rate. A
study by the NAM Re¬
Department indicates that

that

illusion

widespread

can

increased

There

ing

them

Measures

There

huge

careful

■

Inflationary

few

our

capital facilities

omy

bother

What

therefore,

Our association,

the following measures:

rate.

mendous

to recall is that

Private

tax

lying

now

have

part

condition of the
pervades all

which

market

capital formation is seriously im¬

Some

the current reduction in

productive facilities is

»..»■

corporate profits did not increase

Government

statement

Policy

lem.

permit them to be passed on,
they have to be absorbed in
the form of reductions in profit

adopt such deficits as a weapon
against the recession. This should

ficulties.
*A
Fiscal

War

outlays.

less, and we can't expect that tax
rate reform will solve this prob¬

deliberate decision to

without any

risen to $34 billion, ten times the

disputing as to whether the in¬
flation, which had then been going

tion

to be relent¬

seems

lem is that market conditions will

We have now reached a situa¬
tion where rising cost levels have

pressure

tomers.

not

caught up
with
the
money supply, but evidently
forged somewhat ahead.

labor costs

upward

sub¬

not

only

The

us.

even

creating
deficits,

are

budgetary

nomical.

culation, and sufficient credit was
available, to insure that there

for the ailments which

cure

emphasis
effects of the pres¬

revenue

tained

monetary measures had at¬
a
long lead in this race.
There was enough money in cir¬

plete

afflict

predict in

and

the fiscal

better not

to state that we had
rely on this as a com¬

reliance, the
amount required might be astro¬

II,

frankness

time,

same

Re¬

end

War

the

'■

verting to the analogy of the race,

know how much "enough" would

World

....

compels

is doubtful

have that.

even

can

may

the ability of fiscal and monetary
measures to offset them.
By the
of

since

capital goods outlays is

nomic

In, the jong7runKV,it

will

for wages to rise faster than pro¬

hope for is prosperity with

we can

Rising Labor Costs

to offset the job-de¬

money

easy

and

deficits

budget

use

can

problems

other

exist.

ized

labor, in which case we can
have
some i hope
for prosperity
without inflation. *; Alternatively,

would

structure

rate

tax

tremendous and permanent
lift to the economy. It will leave
us
in
better condition
to face

give

Two Choices

Poses

These are:

The tendency for unit labor
to
increase* continuously.

(1)

which most of

economic

other

referred.

economic

chief

two

are

every

haven't

especially in 1955 and 1956.
feel that

the inonopolistic

cessive economic power of organ¬

There

also involve a

that

by the compression in the spread of rates
The statistics on gross outlays
fact that price rises are still con¬ along the income scale. Our rea¬
tinuing. Rising prices with rising sons for recommending this action for new business capital can give
will be explained more fully in a very false impression.
volume might be due to either
The $35
cost
push or demand - pull. But the later discussion of restrictions to $40 billion totals of recent years
oil economic growth.
make it seem as though we are
rising prices with falling volume
must obviously be ascribed to the
We believe that such a reform building up our facilities at a tre¬

■

context.

rates

It would

bracket.

should be resolved by now,

recession

The

years.

individual

and

controversy

This

demand."

capital

one

suggestion

dication

advocated

been devoting enough of our en¬
ergies to the formation of business
capital. There has been much talk
of our "capital goods boom" in the

But

objective than that.

broader

about economic chaos in time. Also pre¬
to permit

Prob¬

palliative.

temporary

free competitive
and

surely in making changes in our
tax system, we will went to have

increases."

scribes tax reform and strict government economy

any
one
of them
would be effective to some degree

Holds
palliative which would result in prosperity with

inflation and bring

been

almost

ably

attempt "to offset

job-destroying effect of uneconomic cost

have

tion

"underlying ailments, rather than
their current symptoms," Mr. Hagedorn maintains we must
remove
excessive labor power rather than prescribe budget
In

reduc¬

schemes of tax

allocated

It may come as a shock to hear
the

period

National

Various

little will
formation.

belief

Planning Group

EAST
ment
been

South
in

Feren

ORANGE, N. J.—Invest¬
Planning Group, Inc. has

formed

with

Harrison

securities
is

offices

Street, to engage
business.

Morton

principal.

Joins Remmele-Johannes
(Special to The Financial Chronicle)

DAYTON, Ohio—Rita A. Flahive

is well and there are no has joined the staff of Remelleproblems. On the contrary, free Johannes & Co. Mrs. Flahive was
competitive markets cannot do an formerly with L. E. Jenkins & Co.,
adequate job at present because of Incorporated.

Volume

187

Number

5746

The Commercial and Financial Chronicle

(2409)
/

Manager of the Aliquippa Office,
xs
replacing Carl H. Droshar, who

News About Banks

cipal Office of Mellon Bank.
cierbert

CONSOLIDATIONS

reer

NEW-

BRANCHES

NEW

OFFICERS, ETC.

the

CAPITALIZATIONS

oank

rsl.

managing
partner in the venture capital investment firm of J. H. Whitney &
Co., has been named a Director of
Tnayer,

iviay

Cooperman
in

career

age

started

1906

66.

was

his

Mr.

banking

with the old Corn

Exchange bank, N. Y.

branch

the

bank's

48th Street.

>•.

charge

;

■

;

■

was

•
.

ant

Secretary •;

their
:

50th

ration

Trust

Co.,

testimonial
in
,

their

honor

Edgar
Walter

Bankers

York,

Trust

Company,

The

May

;
*

Quarter

Century

Club

the East River Savings Bank, New
York

held

its

dinner

annual

Attending their first Annual
Meeting were four Senior Officers
six

Dime

Union

Bank, New York
will open for business in a new
its

Avenue

old

the

Dime

site,

corner

Americas

The

has

bank

lower level and first

recently
completed.
Since
January, 1956, Union Dime has
been
in
temporary quarters on
of

the

Americas at

Bank

new

of¬

West

Avenue

The

dend

annu

from

founded

resources

serves

1866,

of $600,000,000.

over

compounded

per

quarterly

day of deposit.

The

meeting

Plains,

Quarter

Century Club
May 21 in Scarborough.
ft

SJS

Trust
N.

Y.,

held

was

capital stock of South Shore
National Bank of Quincy, Mass.,

floors of the

$1,250,000,

14-story building has
Guaranty

Trust

increased

shares,

Company

will

relocate its stock transfer division

the

West

Broadway
structure upon completion of the
new building in September,
1959.
new

David

elected
Trust.

been

the

housed

former

recent

Frederick

years

Looser

the

Trust

York

Frederick

van

promotion of
B. Joy from Assist¬

ant Vice-President to

dent.

New

the

announces

Vice-Presi¬

Mr.

Joy, who has been with the
Irving since 1953, is in the bank's
Presonal

Division

Trust

engaged

and

planning and
business development.
William
L.
Carlisle, Personal
Trust Division, and Eric Freund,
estate

Loan Administration
were

Division,

promoted to Assistant Vice-

President

from

tary.
Branch

Secre¬

;

Roger

Assistant

Street

21st

Office, John W. Downey,

Walter W. Gendermann, Harry E.
Goett

Charles

and

Comptroller's
Gunter

and

William

Personal; Trust
named

Peterman,
Cecil J.

Owen,

Division,

Assistant

William

Division;

were

Secretaries.

Conroy

was

named

Assistant Auditor.

William

Reilley,

Henry G.

Cooperman,

Company,

Wilkins¬

bank

represents

has

been

with

iji

Citizens

Ohio,

ill

Trust

has
to

agency at New York, as well as a
resident representative at Chicago.
:!»

First

capital stock

$200,000 by
May

In his

port

Banking
Pa.

has

Benedict

investment

position he will

new

Robert

and

Knight,

Trust

the

started

ville,

•

Ill"

Trust

Co.,

The

Falls,

First

Great

000,000

National

Bank

increased

its

stock

$1,200,000

from

$1,stock

THE

National

Bank

Buttonwillow"

effective

May 16.

:
ft

'I'

Bank

South Africa,

don, Eng., have
ommend

nual

Ltd., Lon¬

resolved, to rec¬

shareholders

ish

subject

and

currency

eight shillings and

pence

the

pound

been

bank

the

his

ap¬

an¬

banking

Citizens

Trust

its

common

$1,000,000 to
$1,250,000, effective May 14.
(Number of shares outstanding—
100,000 shares, par value $12.50.)
Dixon

and

six

pence

ended

year

share for the

per

March

31,. 1958,

appropriate £ 160,000.

Fund and £ 50,000 to

serve

Notice is

He worked in various divi¬

Bank,

its

balance

£479,021.

Bank's investments stood in books
less

than
31

necessary

made.

value

market

last

all

and

provisions

have

standing

shares,

5,000

will be closed from

July 2 to 15,

both date inclusive."

par

East National

South

Mich.
President, The Detroit Edison Company.

HENRY T. HEALD, New York, N. Y.

President, The Ford Foundation.
MAURICE HECKSCHER, Philadelphia,
Counsellor-at-Law.

Citizens

Company became the Can¬
onsburg Office of Mellon and at
that time was appointed Assist¬
ant Manager of that office.
ft

pointed Manager of the West Aliquippa Office and J. Austin Leis,
Assistant Manager of the Aliquip-

Mellon

National

Counsellor-at-Law.

,<•;

issued

by the office of the Comptroller

NICHOLAS KELLEY, New York, N. Y.
Counsellor-at-Law.
ELMER L. LINDSETH, Cleveland, Ohio;

Merger

certificate

was

the

Currency approving and
making effective, as of the close
of business May 9, the merger of
The First National Bank of Cam¬

den, Camden, S. C. with

common

National

Bank

title

and

The

National

South

Bank

Charleston.
it

Bank

increased

from

Atlanta,

Ga.

$2,800,000 to

$3,000,000, effective May 9 (Num¬
ber of shares outstanding—300,000

RUSSELL B. LOWE, Fitchburg,
Manufacturer.

shares,

par

value $10).

Mass."

RICHARD H. MANSFIELD, New York, N. Y;

Partner, Lazard Freres & Co.
ARTHUR B. VAN BUSKIRK, Pittsburgh, Pa.
Vice-President and Governor,

~;T. Mellon and Sons.
A certificate of nomination of the said candidates has been

filed with the Insurance Department

duly
of the State of New York.

The annual election of Directors of The

the com¬
capital stock of The Fulton

National
was

stock dividend

President, The Cleveland Electric
Illuminating Company.

$160,000, into The South

Carolina

mon

Robert M. Herbert has been ap¬

WILLIAM A. KELEHER, Albuquerque, N. M.
\

Pa.

J. ERIK JONSSON, Dallas, Texas.
Chairman, Texas Instruments Inc.

Bank

Chicago, 111.

charter

the

Equitable Life Assurance Society of the United States has
candidates for elec¬

WALKER LEE CISLER, Detroit,

Charles R. Gill and Joseph Wawere elected Vice-Presidents

hereby given that in accordance with die provisions of the

Bank

when

STATES

UNITED

Physician.

value

appointed Assistant Secretary and
Treasurer.
He joined Mellon

was

EQUITABLE

JAMES B. BLACK, San Francisco, Cal.
Chairman, Pacific Gas ahd Electric Company.

$100).

Equitable Life Assurance

Society of the United States will be held at its Home Office,
393 Seventh Avenue, New York 1, N. Y., on December 3,1958,
from 10 o'clock

4 o'clock p.m.,

and at said election
Class of the Board of Direc¬
tors, are to be elected for a term of three years frbm January 1,
1959. Policyholders whose policies or contracts are in force on
a.m.

twelve Directors, constituting one

the date of the election and have been in force

prior thereto

are

entitled

to vote

Vice-

New York,

died

Trust

Vice-Chairman

the

Denton,
bank

an¬

nounced.

Mr.

Company, Pitts¬

Frank

Herbert, formerly Assistant

By the
common

tile

sale of

person or

least

proxy or

one

year

by mail.

N GORDON K. SMITH, Secretary.

stock, the
capital stock of Mercan¬

National

Beach,

Fla.

new

Bank

was

Miami

increased

from

May 28, 1958.

been

shareholders

ARLIE R. BARNES, Rochester, Minn.

cap¬

and

nominated die following named persons as
as Directors of said Society:

$250,000 to $500,stock dividend, effective
(Number of shares out¬

usual

tion

Dixon,

common

Charleston, Charleston, S. C. with
common stock of $3,650,000.
The
merger was
effected under the

Pa.

writing

down bank premises carrying for¬

Insurance Law of the State of New York die Board of Directors

from

To the Re¬

Notice of Nomination of Directors

National

increased
stock

1933.

sions of the bank and in 1946

and

making

totaj distribution of two shillings

& 393 Seventh Avenue, New York 1, N. Y.

of The

in¬

tax

come

of Evans-

an¬

Meeting to be held
on
July 30 payment of a final
dividend of one shilling and six
pence per share payable in Brit¬

OF THE

from

stock

Carolina

burgh,

General

LIFE ASSURANCE SOCIETY

re¬

its

"Community

March

Mont,

capital
to

Bank,"

changed

Director.

Calif,

title

ward

Bank

of¬

,'!l

increased

Ind.,

capital

Company in Canonsburg, Pa., in

Buttonwillow,

Dallas, Texas, elected Charles E.
Beard

Vice-

Officer

Citizens National Bank

stock of

Office

com¬

$100,000

By the sale of new stock, The

of the

has

nounced.

1952

from

dividend
(Number of
shares outstanding—10,000 shares,
par value $20.)
Exchange

Ohio Citizens.

Senior Vicb-Presi-

Vice-Chairman

stock

effective

elected

P. Davis, III and

with

Bank

Shiner, Texas increased its
mon

Bozem&n,

common

"Buttonwillow National

six

ill

National

Company, Toledo,

serve

by a
May 16

Pittsburgh, Pa., Frank R. Danton,

Dietz

States

Canada, and branches
Portland, Ore., Seattle, San

The

the Trust Department.

President

Greenwich,

Bank and Trust Company,

Mr.

Mont.
capital
stock
from
$150,000 to $250,000
effective
May
13
(Number
of
shares outstanding—2,500 shares,
par value $100).
its

Smith, Assistant Secretary of the

Mt. Lebanon Office of Mellon Na¬

career

United

has nearly 800

area

The Board of Directors of Ohio

pointed Assistant Manager of the
tional

Moreton

Francisco and Los Angeles and an

common

Fidelity.

Beswarick

the bank.

branches in

as¬

Assistant Man¬

than

Mr.

the

Mid-continent

Bank

increased

"The directors of The Standard

with

which

iji

He will be

tional

dividend First Na¬

President of the Trade Bank and
Trust

The

service

stock

since 1936. He became
Manager of the Bloomfield OJficc
in 1946.
;
:
"

III.,

Herman F. Dietz

years'

hala

Bank
3:

Mr.

been

Trust

Day,

He has

Harry Thompson and
Cassidy who were re¬

cently elected

ital

Philadelphia,

Co.,

Mr. Moreton has had

agers of

department until his

gas

1911.

Bloomfield Office.

000

Company,

Bank

gas

par
IS

appointment at Dallas.

retir¬

Assistant Manager Charles O.
Brawdy will assume the respon¬
sibility
of
operation
of
the

Putnam

dents.

has

Pennsylvania

John

National

Board

sis

First

department store at Elm Place in

Trust

Greenwich, Conn.

downtown

Irving

First

sis

Company

elected

Brooklyn.

sis,

Meiklejohn

The bank's stock transfer division
has

$1,000,000

value $25.)

par
•

Trust

from

effective
May
13.
(Number of shares outstanding—

Company of New York.

Guaranty

1957.

Com¬

petroleum
department at
a

Canada, in 1950.
Mr.
as Manager of the bank s
business development department
in
Alberta, region, was closely
connected with the petroleum and

Wilkinsburg Office
Fidelity and its predecessor, the

\
com¬

mon

was

natural

Bank

established

Hewitt, Assist¬

since January,

stock dividend, the

Approximately 150,000 square
feet, representing the first six
leased

been with the

dinner

County

White

.■

Karl

ficer in

annual

The

■

Vice-President, who is

bank

seventh

Company,

and

Canadian
*

natural

41st

been

succeeds

310,000 de¬

at the rate of 3lA%

shares,

outstanding—12,000
value $100).

Fidelity

Lincoln,

was

also

Mr.
Beswarick, who has been
Manager of the Bloomfield Office,

2nd

positors, including 25,000 school
savings depositors. Its latest divi¬

By
ft

and

Street.
has total

and

Beswarick, Vice-Presi¬
dent of Fidelity Trust
Company,
Pittsburgh,
Pa.,: has
been
ap¬
pointed Manager of the bank's

ant

Dallas, Texas.
The

John D.

Savings
a

Street.
ft

relation¬

fice

there

Harlan

three floors

of the 111 West 40th Street Build¬

Amenue

formed

was

the

ing

;•

burg, since

social

joined Mellon Bank in February,
1958, when the two banks merged.

sisted

1931.

fice

the bank's personnel
charitable activ¬

Lincoln

Assistant Treasurer and

Officer

•'

Calgary,
Moreton,

dinner-dance

sponsor

The

40th

leased

^Company

'■

John P. Moreton has been ap¬
pointed resident representative of

merce

the

ing May 31. Mr. Hewitt has been
Manager of the Wilkinsburg Of¬

ities.

Street.

May 24.

Club

among
to

1958,

iji

further

The bank

June

Savings

home

Bank,

election
Trustee.

Brooklyn, N. Y. opened
elected

was

Monday,

the

February,

Mellon

Wilkinsburg Office, according to
J. A.
Byerly, President.

Club, composed of
employees of The

and

ships

Senior Supervisors.
De
G i u 1 i o
outgoing-

President,
D'Artagnan
Adamo
Vice-President,,, and Arthur. E.
House, Secretary.
•V".
On

given

Downtown

Savings

:!«

Dime

The

Joshua

President presided.
Edward
Focacci

Savings Bank of Brooklyn,

1933

and

the

annual

N. Y. was held

May 27. The Club now consists of
73 Quarter Centurians.

and

24th

The

York.
was

May 23.

Haeffner

officers

Corpo-

Hussey, President of

The
of

Side

New

announced

Peter C.

Moore, Chairman

the Board.
.

New

West

N. Y.,

announced

was

by William

Thayer

the

luncheon

Athletic Club

the

with

year

joined

Mr. Leis came to the Woodlawn
Trust

celebrating

a r e

(Num¬

The Canadian Bank of Commerce

time of the merger of Woodlawn
Trust and Mellon Bank.

Trust

George F. Jebbett and F. Stan¬
ley Saurman, both Vice-Presi¬
dents, and Sol A. Rosinko, Assist-

the

and

1944.

served

■

Bank

After working
of

ft"

s;i

dividend effective May 15
ber of

Trust

divisions

ca¬

appointed Assistant
Assistant Treas¬

was

Mr.

banking

Woodlawn

various

secretary
Waller

his

Jompany* in 1926.

and

urer

started

with.. the

REVISED

$1,500,000 to $2,000,000 effective
May 14 (Number of shares out¬
standing — 200,000
shares,
par
value $10). '

been transferred to the Prin¬

nas

The Commercial and Financial Chronicle

(2410)

Farm

The Current Recession

causal factors responsible for present reces¬

dismissing fears that another depression of the
1930's is likely to come about, noted British econometrician
now here as a visiting economist anticipates recovery beginning
before the end of 1958. Dr. Clark warns, however, that errors
and

tax

policies will

monetary

movement

economic

last

the

recession, that of 1.953-54, as meas¬
ured by three of the most impor¬
indicators available—the fall

tant

industrial

manufacturers'

the fall

production,
sales

the

and

fall in employment.

These

recessions

certainly

fall

far short of the economic devasta¬
tion

the

1930's.

the

Great

nantly an inventory cycle, this is
a complete description;
There
is another element in
it, which
began quite early in 1957, namely
decline in sales of capital goods.

always happens on these oc¬
casions, production in the capital
goods trades, in fact in all heavy
industry, has, for the time being,
than

faster

sales.

Nevertheless,
tlicy
great and avoidable eco¬
nomic losses, are responsible for

This, however, is a temporary re¬
lationship, ; which will later be
reversed.
The recovery >of pro¬
duction
in these industries will

imuch

also

Depression iof

cause

human

suffering,

and—a

further

important point
which
may have escaped you, but which
an
outsider sees very clearly —
these
recessions,
even
though
mild, do great harm to American
prestige in other countries.
Communist and neutralist prop¬

throughout the world
hasten
to
play up
every
piece of unfavorable news, and
give to millions of uninformed

agandists
will

people, who have little accurate
knowledge of the United States,
the impression that the American
economy is crumbling.
To those
who believe, as I do, that the pres¬

ervation

depends

upon

world

largely

peace

the

maintenance

American

prestige and influ¬
ence throughout the
world, this is
a very serious matter.
Could not these recessions have
been

foreseen?

And

could

so,

they not have been avoided?

more
rapid than the re¬
of sales. These relation¬

covery

are due to
the emptying,
subsequent refilling, of pro¬

ships
and

duction
been

pipelines. There has also
decline, rather more rapid,

residential

Factors

The fact that

these

sec

tially,
to

tion,

the other hand, has, on
the
whole, held up surprisingly
well.
Probably the basic reason
for

this

can

even
can

par¬

claim

understanding of
the different causes at work, and
of their relative importance.
If
we wish to isolate a
single prin¬
cipal cause, we can say that this
recession, like that of 1953-54 .and
of 1948-49, is primarily an inven¬
tory cycle. To describe it a little
some

not

fully, we can also say that
only was there a somewhat

excessive

building-up of inven¬
a
building-up of

tories, but also
a
i
backlog
of
These
marked

much

durable

now

buildings,

which

Finally,
decline

the

other, in a manner which
is exceedingly complex. We now
relations
will

than

probably

these

did.

never

fairly

they
simple

complex

mathematical formulae, similar to
those
the
will

which

engineers

left

Further

out

research

lationships, which
vital

and

*From
York
York

use;

non-mathematical

When first

forecasting the pres¬
recession, early in ,1957, I
thought at the time that it was
likely to continue well into 1959.

ent

urgent

talk

Society
City.

are

and

running.
these

indicate

process. •.'Inventory
cycles generally all take the same
form. • During the years of good
trade there is a
steady buildup

both

inventories

has

begun

un¬

follows
riod

Then, after business
turn down, ; there
short and painful pe¬

best

described

one

"involuntary inventory accumula¬
tion."

Manufacturers and traders

trying to dispose of their in¬
ventories, but goods from orders

are

placed in the recent past are still
being delivered, while sales are
falling.
So inevitably they find
their inventories growing, (for a
time, although they are trying to
reduce

before

the

end

1957,
and inventory reduction, the basic
necessity
for
recovery,
began.
These figures of

tion

are

those

inventory reduc¬
which

should

watched most
when

closely, to indicate
recovery can begin.

present

serious than that of 1954.
me

reassure

have

ing,

Great

by Dr. Clark before New

Analysts,

come

the

depression
so

about.

realized

were

factors,
at

unfavorable

New
now.

the

What made

which

disastrous

began

time,

two other

only

'dimly

both

hasten

And $5.70 Pfd. Offered

made/now.

recessions

Public

also

made

then, and both fav¬

productive

products;
improve¬
in

methods

movement.' of

the

pect.

/ 7-77 •'

7:'?

This

improvement in the rela¬
position of farm products is

tive

world and not merely an Amer¬
ican
phenomenon.
It is indeed'

surprising how well world prices
of agricultural prices have stood
up during the present recession.

Stone &
The

1941,

wrote

which

book

estimate of world markets at that
and

date

farm

products

relation
trial

prices for
higher, rin

much

the

prices of indus¬
products, than they had been

before

the

forecasting

into

largely

war,

expected

world

because
of Russia

entry

markets

seller

and

of all

others who understand the

It is

measures.

natural

were

Securities

priced

are

Corp.

99.25

accrued

interest, to
yield
4.68%7 The
preferred; stock
is.„
priced at $100 plus-accrued divi¬
:

7 It is the duty of economists-and

$5/70

stock

(May;128)by
o u p s
headed

Webster

bonds

dends per

Part

share.
the

net

proceeds

from

the

financing will be applied to
repayment of all of the company's
outstanding bank loans, expected
to amount to $34,000,000. The bal/
ance of the proceeds will be used

for construction.

The

will

estimates that it

company

spend

approximately $155,000,000 after Dec. 31, 1957 to com¬
plete
the
construction program
scheduled

date. ;The

that

includes

gram

three

pro?

principal

segments: completion of the "loop¬

ing"

the

from

original; main

Louisiana/

line

New..

York

line

from

tendency
pipe;
of all governments, of "whatever City with larger,.diameter
construction of 445 miles of lateral
political party, to like to go on
lines in southern,Louisiana to tap
collecting taxes.
They - will not
new
gas reserves;. and construcrelax their grip on tax revenuesa

until a real movement of public
opinion compels them to do so: Finally, on the question OT tax

remission,

should

like- ;to say
That I strongly agree with Pro¬
I was rash enough to entitle "The)
fessor Burns, in demanding a tax
Economics
of I960"
making an

yesterday

Suggests Quick Action

company's

preferred

underwriting
g r
jointly by White, Weld & Co. and

rapid increase in the
supply, by 7% in nine

very

out
of farming
has been nature of these recessions not to
rapid that since 1945 the gross Temain silent, but to raise ias
production of American agricul¬ much clamour about them- as pos¬
ture has only been rising at about sible, to get them talked about,
and
to get. people 7 worried—in
1% per year, less than the rate
of growth of population.' In the fact, J advocate the exact opposite
of the line which is being* taken
case of farm
products, demand is
in
Washington.
For it' is only
on
the
whole
now
tending to
catch up with the supply. Higher when business and public opinion
is clearly moved, and the electors
prices for farm products—which
are
becoming anxious, • that' the
will
inevitably
involve
further
average politician will be willing
wage demands on the part of in¬
dustrial labor—are now in pros¬ to initiate the necessary counter-

tion

line

Jersey to the

Field

Leidy

central

north

7
)
The bonds will have the benefit

immediate, but also permanent, to
be offset by economies' in 'gov¬
ernment expenditure as soon as
business improves. Though not so
heavily taxed as Britain; where
taxation takes 37% of the entire ^

will

income,: the.tUrrited

Pennsylvania.;^,,/-

remission which shall be 'not only

national

New

Storage

net

miles

192

points of connection with the main

annual

sinking fund which
in 1962 and which

commence

will retire approximately 90% of
the issue prior to maturity.
The
company

redeem

may

nevh

the

bonds optionally at prices ranging
from 105% to 100% except that no

redemption

buyer of farm products. .1 think
that these predictions will be ful¬

ing

over-taxed
nomic

rate

not be

sinking

part of

refund¬

curring

filled, though perhaps not quite
so
early as 1960.
;7;'t". \*

be carried out for

may

five years as

States, where the proportion now
stands at over 30%, is
also an

manufactured

goods

and

other

country.. The
eco¬
health of the country:will
really satisfactory until the
ratio of taxation to national",In¬

factor, more im¬ comes has been substantially re¬
portant even than farm prices, is: duced.,
Although I find that many
tha t of population.
About 1929 American - economists
disagree
there was a serious slowing-down
With me, I am convinced that ex¬
in the rate of population growth
cessive taxation, particularly too
in the United States, and also in'
high a rate of taxes on corpora¬
many other countries
important tions, is the root cause of. the perr
in
world
trade.
This
slowing- sistent fall in the value of., the
down
in
population growth in¬ dollar, which has been
going 011
deed played an important part in
ever
since the war ended.Busi¬
bringing about the fall in the nesses become all too
ready to in¬
prices of farm products on world cur
increased
costs
and
wage

markets.

also

meant

very

heavy fall in the demand for
housing, particularly as the rate
of

residential

construction

had

been

exceptionally high in the
(in 1925 nearly one million
residences
were
constructed,
a
1920's

rate

almost

the

present

United

the

same

day,

States

then

than now).

come

States

has

that

although
had 25%

population and 50%

the
less

less real in¬

But the United
entered

now

new

phase of population growth, at

rate which has confounded all the

experts of the Census Bureau, at
a
rate of population growth
of

1%%
est

of the high¬
world, consider¬

per annum, one

rates

the

ably higher than that of India.
Sees Recovery Before 1958 Ended

conclude,
of

there

beneficial

are

factors,

which

will
pull
the
economy
upwards again. The recovery, so
far

can

now

see,
before the end of 1958.

This

still

however

payments

when

they figure that

than half of any increase in
costs
will
fall
upon
the

their

Treasury, and not
net

Board
but

upon their own
The Federal Reserve

profits.
has

followed

well-meant

mistaken

policy of monetary
restriction in the vain hope that
they
could
thereby check this
persistent increase in costs, which
is in fact due to other causes; and
the policy of monetary restriction
has only served to aggravate the
inventory cycle.
V7
,7 i-.

*.*

Joins Foster
':;

<-,v; 'v;~"'

■

Bros., Weber & Co.,

241

Stock

Ex¬

and

what

four

five

years

1959, production
employment will be below
they might have been, and
losses will be incurred

economic

commencing with the
period ending May 1,
1964, and continuing in each suc¬
ceeding 12 months' period through
May I,' 1973; thereafter the annual
sinking fund will be 5 shares for
each

100

stock.

The

preferred

;; ?.

'77:.

reported

company

the

for

12 month

period ending March 31,
of
$101,326,852
compared with $89,689,567 for the
same
period ending in 1957. Net
1958

revenues

income

for

$15,978,680

the

1958

against

period

was

$12,830,749

1957.

Transcontinental
ates

owns

and oper¬

interstate

pipeline system
transportation and sale of
natural
gas.
The main pipeline
an

for the

system
the

extends

Texas

Coast

1,842

and

miles

from

Louisiana

the

New,

Gulf

area.

York-Nevf

metropolitan
"

- •

/Harris, Upham Adds
(Special to The Financial Chronicle)

OMAHA, Neb.—John Dimitroff

John F. Wark, partner
rill

been

added

the

staff

Street.

changes.

Lynch,

Pierce

With John A. Kemper

(Special to The Financial Chronicle)

in Mer¬

Fenner

employee of Charles E. Merrill &

some

Even

the

which.

months

has

Midwest

age of 61. Mr.

due

100

Harris, Upham & Co., 1904 Farnam

and

may

to an annual sinking fund
amounting to 2.5 shares for each

perior Street, members of the New

about

York

think in

recession,

will

The preferred stock will be en¬

Su¬

Smith,-passed

advance

bonds

100%.

(Special to The Financial ChkonicleX-

John F. Wark

gives,

the

titled

TOLEDO, Ohio—Richard D.„Tot
polski has joined the .staff-of Fos¬
ter

fund

Jersey-Philadelphia

Bros., Weber

lightly, for undue optimism about
the near future, or for failing .to
inventory

;

operation? involving the in¬
of debt with an interest
of
4.68% or less. For the

;

■■

redeemable at

will begin

grounds for treating the recession

hence.
very

farm

great

the

cumulative

mitigated 'by
such measures. In 1954, -not- only
were tax remissions granted,
but

$25,000,000

Gas

Pipe Line
Corp. 4%%-. first, mortgage pipe
line/bonds* due 1978 and 150,000

1953-

1948-49 and

offerings; of

Transcontinental

were

resembling the

Depression of the 1930's is

likely to

orable

But let

by saying that,
grounds for say¬

clear

cash.! Both the

most

all

but

number

you

that nothing

clearly of
is

recession

Pipe Line 4%% Bonds

reces¬

would

labor

So,

Sees No Depression
The

economic

and

filled orders.

re¬

importance,

Security

however, for¬
some
speeding

this

1929

into

farming,

But the

economist

the

inter¬

enough to be reduced to words.
The relationships will have to be
expressed

some

Federal Government.

But

been

quantity of goods
purchased by the

finished

the

non-durable

each

the

;

them. This period of in¬
voluntary inventory accumulation

the

goods trades. New orders, unfilled
orders, productive capacity, in¬
ventory and sales all influence

understand

has

there

services

uneco¬

therefore

operate, and
be replaced.

have to

and

become

others,

marked

than

process

than

orders.

were

stages

some

productive
and

unfilled

movements

high rate of ob¬
prevailing on old

solescence

nomic

fore-

now

that

the

The events of 1957,

Work

recessions,

means

have

In¬

dustrial and commercial construc¬

tunately
Causal

;

construction.

Transcontinental Gas

severity of monetary^policy also contributed to the re¬
cession; neither private families
nor businesses will buy readily if
they - feel .themselves ? short
of

commodities.

been

have

ments

not

much

for

There

Although thei present recession
can
be
described
as
predomi¬

declined

the recovery if it were

But;
to

altogether;

Thursday, May 29, 1958

months ago,

some

—

being pressed ahead as rapidly as
possible.

the

objective

already shown a decline greater
than the complete downward

prices.
only refer

made

important money
particu¬ ^months,: In the current recession
larly livestock products, now sell there have been no such reme¬
satisfactorily on the free market dial measures, and America is
which should be the ultimate suffering more in consequence.

country," and hopes tax cut will not only be immediate
,"'-C/:?/./.
but also permanent.

has not yet reached the
end of its down-phase; but it has

support

these

Many

taxed

The economic recession now in

sion

other

number

been

avoided.

been

remission,*?if it

American farm products,

necessary

progress

all,

limited

and calls for public clamor to prevail
upon
Congress "to initiate necessary counter-measures."
Attributes our inflation to our tax policy, terms us an "oversuffering than

about

after

greater

cause

tax

Undue

the

and
,

have

might have prevented the

hand,
the
American
farm
problem, which
has been with you for so many
years, at last appears to be within
sight of solution.
We still hear
a great deal about surplus
stocks

and

could

substantial

had

Now,

Director of Research Institute, Oxford University

committed

which had begun as early as 1925.

By DR. COLIN CLARK*

sion,

which

these'' factors

prices.
The depression *of<
1929
was
preceded and intensi¬
fied - by
a
depression
in farm
prices, of a world-wide nature,

Consultant-Economist, The Econometric Institute, Inc.

After analyzing

Sector

farm

And the Economic Outlook
Former

first

The

away

May 17 at the

•

LIMA, Ohio—August H. Plumpe
has
A.

become

connected

with

John

Kemper & Co., 121 West High

Street.

Co.,
sor

Wark

the firm's
company,

office

earliest

joining

boy in 1914.

partner in 1940.

was

the first

With Central States

predeces¬

them

He became

as
a

MANSFIELD,
C. Sponaugle is
States

Ohio — Rowland
now with Central

Investment

Building.

Co.,

Walpark

Volume

Number

187

5746

Continued from page

The Commercial and, Financial Chronicle

(2411)

guises—a practice which is seri¬
ously crippling the legitimate pub-,
lie carriers "upon which the na¬

tion

Better

depends," the Subcommittee,
says.* The Subcommittee, there¬
fore, has recommended that the

Days Ahead
Foi Railroad Industry

amended

in purpose

Act

1936

of- allowing

tice

on Sunday and
opines that the argument in favor of Sunday selling cannot
compare with the spiritual harm in store for merchants and

of portation business shall
transport

each mode

uction

incurred in

debt

mission concluded that "there ap- V. Such

such

pears

warrant

for

believing

•

intended

oses

there

would

business

he deferred taxes would be sub-

increased
Howver, such a proposal would tend
Jo level out the peaks and valleys
of railroad expenditures for equipient and other improvements—to
he benefit not only of the railtantially

made

'axes paid in future years.

oads

the

and

railroads

proposed, it does

he national

transportation system."

economy.

Aether recommendation in this

caused

leld of depreciation charges arises
is

ailroad

extreme]y l°»g service

line

with

property for tax purposes,

the Interstate Commerce Commis-

means

red in

depreciation charges each

mission

Believing that it would help
the

ear.

constitutes

ailroad managements to make
additions

betterments

and

interstate

The' Subcommittee

to permit railroads to establish a 20-year life for depreax

property as

that

one

—

and

passenger

the

Interstate

Corn-

Commission may authorize
the entire abandonment of a line,
but the discontinuance of particular trains or services is a matter

merce

virtually everybody, calls for repeal of transportation excise taxes
of 3% on freight charges and 10%
on

present

and

of "state "authority.

fares: The subject is

Such

whether

But

The Subcom-

further

seem,

there

are

and Means Committee of the House

Commerce Commission should also

and the Finance Committee of the

have authority in this field, in the

ing such
attention

the
be

studies, the fact that

essential

which comes before the Ways

would

take *" up where
present study leaves off.

lem:

Sun-

days are prob-

Roger w Babson
w.

these

markets

Sundays in the Mountain
Pacific States. In California,

open

and

stores of all kinds never close. The

real

for this is

competition
for the everlasting sales dollar.
reason

There

are

the

for

making

9 to

causes

merchant

the

inroads

(1) The
pattern
of
business
gave way to wartime

the Sabbath:

long-term
from

number

needs when stores in certain man¬

ufacturing

remained

areas

our

transportation is receiv¬

cater

open

round-the-

the

field

rates

and

of a local nature."

rate-

1 herent advantages it may possess,

making, the Subcommittee makes
The Subcommittee also gave axtwo important recommendations, tention
to the problems arising
The first has to do with competi- ffom the exemption from regula¬
tive ratemaking—a subject as to tion of motor transportation of
Which there has been a vast deal agricultural products.
Originally
of misunderstanding.

It has been

intended

aid to farmers in

represented that railroads seek the the initial movement of produce
unrestricted right to make what- to market, the exemption has been
ever
rates they please—that this expanded by judicial and adminin turn would lead to "a return to istrative interpretation to include
the law of the

not

a great variety of products that
have received varying degrees of
ratemaking commercial processing and to the

jungle" and "utter

What railroads really seek

chaos."

unrestricted

proposed transportation of such commodirates by rail may not be rejected ties in ordinary commercial chanby.the Interstate Commerce Com- nels beyond the initial movement,
mission because they may ad- Believing that this trend should
freedom

but

only

that

whether--they be advantages of
service
or
advantages
of cost.
When that times comes, each form

transportation will be permitted
do that which it does best, all
factors of cost and service con¬

sidered

that

their

rates

must

always

compensatory, - in the
opinion of the Interstate Commerce
Commission, and nondisreasonably

criminatory as among shippers,
again in the opinion of the Interstate Commerce Commission.

The

Some

Concession

The Subcommittee did not adopt
the railroad's

before the position of
all regulated carriers is more seriously impaired, the Subcommittee
recommends a halt to further expansion of the exemption and a
return to economic regulation of
the transportation of frozen fruits
and vegetables and imported agricultural commodities.
Subcommittee

cerne(j

aiso

over

practice

■■

persons

the

was

growing

recommendation, fa- themselves to be private carriers
miliarly known as the "three shall who actually engage in for-hire
nots," but it did recommend that transportation under various

difficulties

ucxdl&c

wuxtt-tls).

movement

mass

lowing the

war

j.11c

Suburbia

fol-

radically changed

consumers'

buying habits; it was
convenient to stay at
home
and 1 shop
iij.J Suburbia,
especially if the stores there re¬
mained open nights.
(3) When
competition for consumer dollars
stiffened, it was but a short step
into Sunday from Saturday after¬
noon—particularly in those parts
of our country where Sunday Blue
much

either

Laws

and

deterioration.

are

weak

—

Marjorie

Hagen has joined the staff of

Edward I. Hagen,
32nd

Avenue.

Is Sunday

Selling Good for

was

Inc.

With A. G. Becker Co.

(Special to The Financial Chronicle)

SAN FRANCISCO,

bert J. Yates
G.

Becker

Russ Building.

Calif.—Her¬

III, is now with A.
Co.

Incorporated,

Needed

youth

0ur

lot

that most of

what

are

others

Dare I say

homes

our

have made them This is where the
Church

in.

comes

Where, if not

in the Church and in the church-

oriented

home, is the average
youth
going to
develop sound
moral and spiritual fibre?
As

businessman, I believe the

business community owes more to
its constituents than just making

it easy £or peop!e to buy what
lwlanp0

cvianf

mnot

k/-»

for spiritual losses that may do far

greater

harm,

the

long

run,

than the immediate material gains.
We may. need a "business depres¬
sion"
and

to bring us to our senses—
perhaps something more seri-~

ous.

Coast Exchange

Explains Operations
Francisco

San

division

Coast Stock Exchange
concluded
a
series
of
five

meetings

with

representatives

Francisco banks at which Exwho and where
you are!
The now famous case of change operations were explained.
Hess Brothers, Allentown, PennSeventy-five participants were
sylvania's largest department divided into five groups.
Each
store, points up one answer to this group was addressed by George
question. . Last October, a lafge W. Davis, Davis, Skaggs & Co,
Chairman of the. Board, San Fran¬
discount house, "Two Guys from
cisco Division,
members of the
Harrison,
Inc.,"
began
drawing
Exchange Staff, and a Specialist
away the Hess sales volume. Hess
Odd Lot Dealer on the Floor of
Brothers
finally
threatened ' to
San

fine the

owners

of "Two Guys

Harrison, Inc.," but also to
fine each of the 100 or so employ¬
ees of the discount house for vio¬
from

lation of

160-year-old Pennsyl¬
This is one
typical problem con¬

vania Sunday statute.
of

side

fronting many communities today.
Another look, however,
that

and

open on

the^ Exchange. After the lecture,
which lasted

half

explained

Chairman
the

and

Floor

after

hour,

Trading
a

the

Vice-Chairman

Committee,

which each banker

signed

Specialist

was

Odd

as¬

Lot

Dealer where the system of han¬

dling odd lots and the specialist's
.

were explained

merchants

Sundays count

between

about

JJe &rouPs were taken onto the
J>or where the detailed operations
were

reveals

their Sunday sales to make

the

week's

changing times must come changing merchandising techniques. In
short, Sunday selling, they say,
has become a matter of economic
survival.

Joins

Copley Staff

CSpecial to The Financial Chronicle)

COLORADO
Vincent

SPRINGS, Colo.—
has joined

Assaiante

the staff of Copley and

Company,

Independence Building,
With Andersen,

Randolph

(Special to The Financial Chronicle)

The

Case Against Sunday

formerly

with Zilka Smither & Co.,

and

centered.

has

Merchants?

1705 Northwest

She

centered

The

profit and loss. These merchants
that times change, and with

(Special to The Financial Chronicle)

Homes

parents heed to bring into
much sharper focus the standards

receive

argue

PORTLAND,fbreg.

standards

...

the Pacific

difference

Now With E. I. Hagen Co.

only token enforcement.

hovering shadows remaining

Speed the day!

con-

representing

and our observance

clouded by the

affect

—

Transportation Week will not be

be halted

another mode of
transportation. The railroads agree

versely

Better

But, these
deeper prob-

a
V.

etc.

adequate

cirrdelense'workers10® " Tte fV want when they want" it. The
balance sheet must be scrutinized
v.1uck

and concentrated
encouraging sign
Senate, but the Transportation interest' oFKaving a sound trans- of better days ahead—a time when
Subcommittee has expressed the portation system adapted to ha- each form of transportation will keep its doors open on Sunday,
too.
Hess' threat caused a Pennhope that repeal of these taxes' tional needs without "undue im- have an equal chance to give the
will be approved.
'
'
portance being attached to matters public the benefit of whatever in¬ sylvania district attorney not only
close

? uly x"UPc?yal? of right and wrong, and we need
that 78% of a philosophy of life much less ego-

are

lack

are

of-

many symptoms of mal-

and values.

super-

imarkets

.'..open

enforcement

adjustment; juvenile delinquency,

That depends on

well

might

mittee believes that the Interstate

one

study,

;

with the

where only

rpaintained facilities.

law

ficials, educators — all who work
with young people—are concerned

shape

rof .the

portation and the desirability of a
system of charges for the com¬
mercial use of publicly provided

0f railroad facilities and services.

endorsed

warmly

the

field 0f discontinuance or changes

Another recommendation

proposes

interstate Commerce
Commission jurisdiction in the
give

maximum for

purposes.

undue burden upon

commerce,

Federal vs. State Authority

reposes

ciable

what

neces¬

sary to meet the modern competitive conditions, the Subcommittee
_

determine

would

the need for regulation
under present day conditions and
the -type
and character of that
regulation; the''ownership of one
form of transportation by another;
Federal policy on the subject of
large-scale railroad consolidations
and mergers; the kind and amount
of railroad passenger service nec¬
essary
to serve the public and
provide for national defense; and
—perhaps most important of all—
the question of government assist¬
ance to the various forms of trans¬

service

hich

would

points

interstate

lite averages 49 years, ^|on to act more
expeditiously in
that only 2 k /o of such cases' and also
clarify the
ailroad investment can be recov- standards under which the Cornhis

Committee

Foreign Commerce,
be given authority

employ three highly qualified

]evejs> <phe Subcommittee's prop0Sal would make it possible for

assigned to depreciable

such

experts for the purpose. The study
would
go
to
such fundamental

by intrastate rates which

out

are

that

which

Subcommittee is designed " to remove discrimination
against
interstate
commerce

Twenty Years Depreciation

The Sub¬

tion of the Senate

Parents,

New

e n

aSJ

•

con-

during the week

fP* .e
divorce, cheating,
PTurilanJcai are indications of

studies be made under the direc¬

Interstate and

little time

becomes

and leisure ever
ought to be able to

for reflection and spiritual regenwork .eration.
i

tnougnt.

committee

The other rate recommendation

week

shorter

greater,
find

the

work

just

t h

worse

recommends

a y

America

this, brief resume of the
pnndi'paT points of' its report, it

made by the

lfethat

into

another
d

;

.From

sent a distinct clarification of the
law and the intent of Congress.,

contained

More Study Needed

repre-

upply railroad needs, but also of
he' shippers and the industries
hich supply railroad needs and

day

.That

statute.

While this is not just what the

which

industries

test",
case.

to add to Section 15(a), a new is obvious that the Senate Surface
paragraph 3 as follows:
Transportation Subcommittee has
"In a proceeding involving com- made a comprehensive, thorough
petition with another mode of and penetrating study of the trans¬
transportation, the Commission, in portation situation. As the com¬
determining whether a rail rate mittee has pointed out, however,
is lower than a reasonable mini¬ there are long-range policy mat¬
mum rate, shall consider the facts ters that "need extensive study
and circumstances attending the and recommendation* to the end
movement of the traffic by rail- that appropriate legislation be
road and not by such other mode." enacted to insure a sound national

he purpose of computing the dereciation of such property. Thus

only way to
convert Sun-

is to

said, would not'
way the "primary

any

the,

stantly

But if the

business

wants

America

test, indeed,
would be written directly into the

terstate (Commerce Act would be

in ' the

reduction

than I do.
,

who

one

Brooks

asis of the property acquired for

prosperous

amendment to the law,

disturb in

corresponding

the Subcommittee

that rail rates, for example, should
be held up to a particular level to
are used for the intended purpose
preserve a motor-rate structure,
ithin five years from the date of- or vice versa.".. ;
w ■
v - ' ;
eposit;
v
.
{:
.' Affirming this interpretation by
Under this proposal, taxes would the Commission, the Subcommite deferred and not forgiven.
As tee, recommended that the only
"unds are withdrawn for the pur- amendment to be made to the In-

acquisition, and provided further
hat amounts deposited in the fund

There
see

ould be deductible in computing

equipment and facilities or for re-

consumer-shoppers.

fund

reserve

...

Mr. Babson draws the line against retail sales

other

service or of cost. This principle, less such transportation is solely
the Subcommittee said, was well within the scope and in further¬
ederal income tax, provided that stated in the 1945 case New Auto- ance of a primary business entersuch funds
are
used only for .mobiles ini Interstate Commerce prise (other than
transportation)
the 1 acquisition of transportation' (259 ICC 475), in which the Corn- of such persons.
construction

the

By ROGER W. BABSON

to provide that no per¬

transportation to assert its inher- property by motor vehicle in in¬
ent advantages whether they be of terstate or foreign commerce un¬

"ship construction.
It
contemplates that moneys set aside

encourage
in

Losses foi Material Gains

sion consistently follow the prac- specifically exempt for-hire trans¬

to that set up by the

Marine

[erchant

the Interstate Commerce Commis-

The plan is similar

Act

Sunday Selling Means Spiritual

in any commercial enterprise
thaii a duly authorized or

son

fund."

reserve

Commerce

Interstate

Selling
The very

fact that so many favor Sunday selling is a reasonably
good index of how materialistic our
culture has become.

history

are

DENVER, Colo.
Haas

The paths of

strewn with the wreck¬

now

—

Richard W.

affiliated

~n<?erTe£' Ran5ol.?J. ^

with

Inc*'

A* Johnson Building.
Midwest Exch. Member

CHICAGO, 111.—The Executive
of cultures that neglected
spiritual development.
The Committee of the Midwest Stock
place for our families on Sunday Exchange elected John E. Munger
is in God's House, not in a Discount of Chicago, to membership in the

age

their

House.

Surely in a country where

Exchange.

The Commercial and Financial Chronicle

(2412)

Continued

Watson of IBM

Bank and Insurance Stocks

Governor of NYSE

grown up

T*\ President of Inter¬
national Busi¬

J. Watson

This bank is

City, .as a
Public Gover¬
of the Ex¬

nor

change.
Watson

Mr.

succeeds
Charles

Wilson, for¬
President

to the present title in

General

Electric Com¬

mer

and for¬

pany

Chairman

Watson,

jr.

who is completing his
a Public Governor. Other

Co.,

term as

Public Governors are Frank Hugh

Sparks, President of the Council
Financial Aid to Education,

for

New York

City; and John David

Libbey-

Co.,

Toledo,

Chairman

Biggers,

Glass

Owens-Ford
Ohio.

of Public Governor

The office

bring to
the Board
of
the Exchange
a
closer understanding of the public
created

was

1938

viewpoint and interest. The Board
is composed of 30 other Governors
representing the Exchange com¬
munity, including the Chairman
and the President of the Exchange.

Bank Credit Assoc.

The merger was logical. Unlike so many others in the
period
not made to attain greater asset size under single
manage¬

ment, but rather because the two banks tied in
been

the

meeting

Associates

the

Bank

New

York

of
of

held May 22, 1958, the following
Officers

and

Governors

John

Vice-President:

1st

Cash
U.

due

State,

Leans

Assets

<fe

other

8,781,238
1,800,000

payable
Acceptances, net

45,903,232
1,576,008,095

_________

$1,796,060,422

value

$10

share.

principal categories follows:

Loans

14.6

Banking houses and equipment

3,2

50.8%

Miscellaneous assets

0,7
2.8

AND

LIMITED

Up to 5 Years

5 to 10 Years

Amalgamating National Bank of India Ltd.
Bank Ltd.

Head Office:

Over

26 BISHOPSGATE, LONDON, E.C.2

years.

breakdown of

the

bank's

sources

54 PARLIAMENT STREET, S.W.I

the Government in: aden, kenya,

from Securities

A'-

Pees, Commissions

■

21%

■%.//

Re¬

years

the

offset

additions

seasonal

early in the new year.
Subsequently,
these
operations
have
been
powerfully
supple¬
mented by a series of reductions
in required reserve ratios (which
released nearly $1.5 billion of re¬
serves) and by three further re¬
reserves

go back to

1948

Describes Extent of Credit Ease

the

20%-25%

area;

somewhat; but it is to be doubted that

proportion of

decade

Book

Operating
Earnings

Value

it will go back

ago.

Record

—

Per
v

Invested

Share*

y /

about

half

had

billion

free

dollars,

billion dollars

half

reserves

few months—a

most

frequently used

of pressure, or lack of

member

bank

excess

reserves.

reserves a relatively
quantity, the swing has
been due largely to a drop in bor¬
rowings at the discount windows

billion

little

over

$100

million.

borrowings has respond¬
in "classic" fash¬
ion, to the "Fed's" activities. At
first glance it might be thought
it should,

that

with

rates

four

since

expect

discount

would

stimulated

great¬

not

deficiencies in their reserves,

and their needs for

Assets

Dividend

High

Low

much

S273

$1.05

24%

21%

reserves

291

1.05

26%

34.04

21%

less

Branches in:

1950
1951

27%

34.62

24%

1.95

322

1.16

1952

29%

35.52

25%

tanganyika, zanzibar, uganda,

2.28

321

1.20

36.56

26%

aden, somali land protectorate,

3 953

2.47

339

1954

1.20

northern and southern rhodesia.

37.66

2.53

337

1.35

1955

36%

38.61

28%

2 91

345

1.46

40 %

35%

requirements

ductions

when

are

bank

not under
discount rate re¬

The

pressure.

borrowing

frequent

generally

india, pakistan, cevlon, burma, kenya,

corresponding period of 1956-57
$1 billion in 1955-56. With

and

demand for business loans shrink¬

ing,

the

greater

FIRE & CASUALTY

INSURANCE STOCKS
Bulletin

Request

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

dropped since October
to

New

York

61%

six

Another

capital

120

BROADWAY,

NEW YORK 5, N. Y.

that, $4

was

are

represented support and

confirmation of

the

open

operations and the cuts in

Bell

(L.

Teletype—NY

1-1248-49-

Gibbs, Manager Trading Dept.)

Specialists in Bank Stocks

The

three

split.

paid.

which

market
reserve

have

made

operating earnings.

available and have made

most

significant indication

of the effectiveness of the

of/ the

As is

usual

in the latter the decline has

even

been

substantial.

very

edly,

venting

rates

volume

and

Undoubt¬

important factor pre¬
steeper drop in long-

term

has

been

municipal

-the

very

new
corporate
securities
that

have been brought out in response
1o
the
more
favorable
market

conditions.
been

course

this

has

healthy development
we have welcomed, as the
corporate financing has helped to
improve business liquidity
and
the municipal issues have contrib¬
a

very

which

encies.

Long-term

the levels reached in 1954 in spite
of
the
sizable
drop since
last
autumn.

The significance of any
particular rate level is not always

the

same

free

reserves,

terms.

able

member banks
had enough additional reserves to
expand their earning
their deposit liabilities
by several billion dollars. In this

assets

and

the banks have used several

hundred million dollars of the
serves

released by the

re¬

lowering of

oercentage reserve requirements.
Thus the fact that member bank
reserves

are

now

lower

than

readily

Reserve

in
The

all

circumstances,

important consid¬

conditions is
that money and capital should be

ferred

Federal

interest rates, hav¬
down from a much

ing started
higher level than was reached in
1953, are still considerably above

change
policy is the
fact that, over and above the tre¬
mendous swing from net borrowed
in

way

At the present
price of about 42% the yield is around 4.70%.
The $2 payment is
only 48% of operating earnings; and in 1957
about 9.2% was earned on the
year-end book value. The stock is
now selling at
approximately 10.2 times 1957

result

sharply than long-term, although

eration

Telephone: BArclay 7-3500

aggres¬

term rates have fallen much

unnecessary.

two-for-one

major

markets.

however.

the

seek

cyclical swing in rates, short-

borrowing at the "Fed" virtually

since

ago

and the consequent stimulus to the

reserves

been maintained

of banks

case

Interest Rates & Capital Markets

34%

that has

the

from

for credit.

36%

$2 annual basis, which has been the rate

from

case

City banks, and

months

the

sively to meet all sound demands

40%

in- /

of New York.
Granted
that these loan-deposit ratios are
still far above those of
1954, we

1.58

are

55% to 52% in the

1.80

The shares

substantial

66%

323

outstanding facets to this tabulation, first the
doubling of operating earnings; secondly, the marked increase in
dividend; thirdly, the favorable treatment of the
stockholder, for
he received the
following stock dividends if he held the stock
throughout the period: 1951, 14 2/7%; 1954,
12%%; 1955 11 1/9%
and a two-for-one
split; 1956, 20%; 1958, 11 1/9%. And the stock
remained on, in
effect, the same dividend rate.

have

335

are

with

purchases. The loan-deposit ratios
of banks, often looked upon as a
rough measure of bank liquidity,

3,40

There

in¬

have received cash directly or in¬
directly from the banks' security

3.74

changes.

the

also in other securities and

39.65

capital

but

40,88

"Adjusted for

part

rities,

1957

EARNINGS
COMPARISON

have,

by $7 billion, as compared
with'less than $2% billion in the

1956

1957

oc¬

To¬

less, use of the discount uted to the
financing of expend¬
window, but that is not the way
itures
which
have
provided
a
discounting works. Banks borrow
partial offset to recessionary tend¬
from us mainly to cover tempo¬
er,

1.79

cuts

November,

have

Si.80

■■■■*.■'

position.

investments

risen

any

and

excess

33.30

30%

and

represents the dif¬

between

$32.63

1.05

loans

change in Federal Reserve policy
it, lias been its effect on interest rates

banking system. This statis¬

measure

1949

312

tal

in the last

swing of about $1

billion in the figure which is per¬

1948

1.77

curred in the bank's

degree

they did during much of last year,
have

rary

,—Price Ranee—»

the

profound alteration which has

gone far

desirable

ber bank

with

Oc¬

have
clearly made headway in
enough to get
restoring a good deal of the li¬
of
credit
quidity that was lost during the
ease?
Well, the member banks
period of restraint—and I hope,
throughout the country, instead of and
believe, that the banks are
having net borrowed reserves of much better
disposed now than*
Have

the

find that loan interest contributed

since

light

outside

rates.

Perhaps it would be well to note
in passing that the total of mem¬

66
___

throw

large

and Miscellaneous

24%

Ten-Year Statistical

13 ST. JAMES'S SQUARE, S.W.I

uganda, zanzibar a somal1land protectorat1

Interest & Dividends

the

and

of the Reserve Banks from around

but loan interest grew with both
higher rates. Naturally, with the letdown in
volume and with the
prevailing lower rates this loan interest ratio
to

conditions

stable

given

also

policy, but really the Fed¬
in loans to carry dealers' increased
eral has done very little." Actu¬
holdings of securities. According¬
ally, open market operations were
then doing their job of easing the ly, we have witnessed a very con¬
siderable
improvement
in ' the
banks' reserve position by more
than offsetting the seasonal strains liquidity of the banks, and along
with it has come a gain in liquid¬
of the year-end, and by doing
ity for others than banks as they
much less than in other

With

investments

and

tober

crease

business

borrowings

only 35% of gross income;, income from securities was
41% and
commissions, etc., 24%. The last named item has remained
fairly

London Branches:

loans

of ex¬

serve

in the

10 Years

that there

mean

corresponding contrac¬
tion in the money supply. On the
contrary, the money supply in the
form of demand deposits, season¬
ally adjusted, has been increasing
at the rate of nearly $1 billion a
month since January.
Statistics on changes
in bank

crease
has been in investments,
pectations of future developments chiefly in U. S. Government secu¬

ference

Loan Interest

and

what

dropped sharply, because

five

also

consider

the fashion to say "Yes, it is
that
interest
rates
have

will shrink

true

tical

55%

was

30% *

100

let

know, our influence is exercised
largely
through ■.'/ affecting
the
availability and cost of credit
through actions affecting the sup¬
ply and cost of bank reserves.
Oddly enough, for a number of
weeks after our policy changed, it

1954_.

-/Now,

monetary policy has done to cope
As you

with this state of affairs.

70%
L.

1953

volume

measure

gross income:

G., Schetlick;

has been

in the preceding two or
years—imbalances in costs,
prices and incomes, in the expan¬
sion of capacity in relation to cur¬
rent demand, in our foreign trade,
and perhaps in the debt structure—
and which together made a period
of adjustment inevitable;,

haps
Maturities

1957

If we

etc

Dividend

27.9%

.—

.1956

Grover A. Strauss.

Bankers

int.,

Taxes,

does not

ductions in Reserve Bank discount

Reserves:

comparison of Hanover's United States Govern¬
ment bond portfolio for the
past five year-end dates:

Raymond TP. Bogert; Samuel W.

•——

Following is

Kearney; Henry Kees; Joseph H.

and Crindlays

$163,507,257

par

—

Government obligations—
State, niunic.
other securities

There

BANK

$36,000,000
100,000,000
profits 27,507,257

$1,796,060,422

—

Secretary: Ramsey E. Joslin.

GREMDLAYS

Undiv.

A breakdown of these assets into

McCul-

OVERSEAS

Liabilities

Capital
Surplus

57,482,129

secur.

December 31, 1957

Deposits

"Due

NATIONAL

planned for New

Since the date of this statement, Hanover issued a stock
divi¬
of 111/9%, increasing the
capital to $40,000,000; and the
shares outstanding to 4,000,000. The

dend

Bank;

William

are

important extent with

912,329,335
Ileal estate mortgages.
3,239,125
Banking houses & equipment
12,207,001
Accrued int. rec.
2,558,969
Customers' liab. on accep.—
45,144,526

lough, .Chemical Corn Exchange

Scharpf;

v/A/'w

—

banks
_$500,5(>0,881
obligations-— 282,538,456

niunic.

Vice-President: Justin Mc¬
Carthy, Industrial Bank of Com¬

Members of the Board

are

from

Gov't

merce;

branches

Statement of Condition

2nd

Thomas

1195769534

Two

Its loans

area.

ducted.

Battista, Swiss Credit Bank;

Treasurer:

Hanover

corporate customers, no retail or small loan business being con¬

U. S.

well.

and

representative in Paris.
York's mid-town

Cash

President:
Francis D. Weeks,
Jr., Marine Midland Trust Co.;

At the time of the Central Hanover merger deposits were
$446,000,000. On Dec. 31, 1957 they were $1,576,000,000, an increase
of approximately 250%. Hanover continues to
occupy a prominent
position with respect to its trust business. It operates nine branch
offices in Manhattan, a complete banking office in
London, and a

were

elected for the 1958-59 term:

bankers'

correspondents' bank. Central Union
Trust had a large part of its operations concentrated in trust and
in similar lines. There thus came into being an
exceptionally well
integrated institution whose growth,, since that time lias been
steady and consistent.

Elect New Officers i
Credit

July 1951.

was

had

of W, R. Grace
&

the

Central Union Trust and Hanover National combined under the
title Central Hanover Bank & Trust Co. This name was shortened

£.

mer

the

institutions,

Hanover National Bank.

year ago

three

Bank Stocks

—

outgrowth by mergers of three large New
Central Trust Co., Union Trust Co., and
It has operated since 1873 under Central
Trust Co.'s New York State charter, granted specially a number
of, years previous of the enactment by the legislature of the state's
general Trust Company Act. Hanover National, organized in 1851,
had absorbed three banks.
Union Trust Co., dating from 1864,
merged with Central Trust Co. in June 1918; and in May 1929,
York

Yo-rfc

New

This Week

The Hanover Bank, New York

Machines

Corporation,

Recession

By ARTHUR B. WALLACE

Stock-Exchange, has
announced the election of Thomas
York

ness

Thursday, May 29, 1958

page

Monetary Policy in

Keith Funston, President of the
New

from first

...

available;

economic

are

present

not

that

sound

project should be de¬
dropped because funds

available

reasonable

The necessary

condition is
that rates be satisfactory to bor¬
rowers
and, at the same time, ac¬
ceptable to investors. It is that
broader

complex, and not just
such, which we try to
keep in view in the development
of credit policy.
rates

Funding of Treasury debt

ear¬

lier this year probably tended, at
least in some degree, to slow the

Volume

187

Number

5746

The Commercial and Financial Chronicle

(2413)
rate of decline in long-term rates

Granted

and, with another large refund¬
ing in immediate. prospect, the
Treasury now faces the difficult

faced

problem of whether to include

would

long-term

issue.-v The-

dilemma

that

with

inflation
the

stable

cies in the United States.

problem of fighting

credit

ately there is ground for hope that
we shall not let matters
go so far
in this country as to constitute a
serious threat to the economies of

after

current

again

may

from

emerge

recession,

think

have been inexcusable to
let this consideration
prevent our

prices, and when aggregate
demands
were
running
ahead of savings. Yet there have
been

occasions

when

imbalances

have developed in particular sec¬
tors which may have contributed

faced by the Treasury at times
like this is how best to reconcile

doing all that

do to combat the recession and to

the

the whole economy.

provide

imbalances might involve the pro¬
portion of output going into in¬

need

for

improving the

ma¬

turity structure of the debt with

and

the desire to avoid serious
ference' with

nancing.

other

opments

fi¬

;

It seems

desirable

the

devel¬

recent months

refute

pretty effectively the old allega¬
tion
that
monetary policy, ef¬
fective
though
it
may
be
in
checking a boom, is helpless to
combat recession.
the banks do

The fact is that

largely

which are

serves

any re¬

use

available

made

to them to make additional

loans

investments, and in so doing
contribute
substantially
to
the
supply of investible funds, with
or

marked

effect

strength of
capital markets.- Naturally I

not

claiming

policy alone
rowers

the

that

monetary
create eager bor¬

can

that it

nor

stimulus

country out of

provide all
pull the

can

needed

Uniform Reserve

Requirements
I would like to

there is

emphasize that

electronic computer to

tell

us exactly how far we should
in this process of easing credit

conditions.
able

After

statistics

all

the

obtain¬

accumulated

are

and

studied, it - is still largely
judgment
which
the
central
banker must use in deciding how
far

fast

move.

must

all times be mindful of the "feel"
of the money and capital markets,
and the geographical distribution
of

that there is not
tightness
in
either
the

reserves,

undue

centers
country.

'money
the

in other parts

central

Governors

spread between requirements, but
has also tended, along with other

the

to prevent the appear¬

have

in
would

degree of tightness

cities

larger
been

which

inconsistent

with

our

general policy of monetary case.
As

has

often

been

said

eloquently than I can, monetary
policy must always seek to tread
a

and~ at

narrow

difficult

- times

path

between the objective of
steady economic growth and the
objective of price stability. The
replies a month or two ago by the
Reserve

Bank

questionnaire

Presidents

sent

the

them

Senator Byrd, set forth in consid¬
erable detail reasons why we be¬

lieve that these two objectives are
consistent in the long run.
But
also

arise
in

recognized that there may

(substantial

the

short

criticized

inconsistencies
We

run.

for

have

been

easing money too
observers who be¬

much

some

lieve

fighting

costs, and
for

inflation at all
have been criticized

being tardy

those
more

who

niggardly by

believe

mindful

should

of the growing sup¬

ply of unused human and material
resources

in the

country.

Fears Recession More Than
Inflation

The

point
in

some

the

some

thq bottom of the
be

may

near,

re¬

cannot

between

actual

output

and

the

country's

growing resources of
labor and capital equipment. Nat¬
urally I hope and expect that we
in

Federal

the

and

the

have

Reserve

continuing

increase

price indices, notably in
price index, as call¬

consumer

ing for continued restraint. Yet
I am quite clear in my own mind
that during recent months the im¬
mediate dangers of recession had

the

industries,

stimulus

un¬

unusually
particular

expansion

credit, designed to check particu¬

distortions
too far.

Senator

Reserve

statistical

before

they

had

As I recently wrote

Byrd, there exists

bureaucratic

problem is the ade¬

good

all

stronger

ever

the

tive

deal

derive

can

satisfaction

one
thing, sterling,
subjected
to
such

But

controls

called

were

strength

(over

and

above

margin

for

1960, 1961 and 1962
yesterday
(May 28).
The
serial
bonds
were
offered
jointly by Kuhn, Loeb & Co.,
Harriman
Ripley' &
Co,,, Inc.,
Lazard Freres & Co., and Smith,
Barney & Co. and the sinking
fund bonds by an underwriting
group headed by these four firms.
Interest and principal are payable

its

monetary reserves of
countries—gold and dol¬

after

in United States dollars.

recent

gives

the

Jiving for the

accurate

true

cost

American

average

believe

which

there

monetary

should

great

policy

combat

can

deal
and

recession.

for

nicipality since World War II.
The
sinking fund bonds are
priced at 97J/2% to yield 5.75%

American

and the serial bonds at par, both
plus accrued interest.
Annual sinking fund payments,
commencing in 1963, will retire
the 1973 issue by maturity. This

part was simply due to excessive
internal demand in many foreign
countries brought about by failure
to check domestic inflation.; The

tary

tendency for foreign

reserves to

issue is optionally redeemable be¬

mone¬

ginning June 1, 1968
declining from
102%
during the last year.

increase is attrib¬

utable, at least partly, to

Without attempting to go But, while I think our record in effective control of inflation in a
into all aspects'of this
subject, I) the past few months in this regard number of major foreign coun¬
might merely point out that, in is pretty creditable, I have some tries, which we may rightly ap¬
the view of many
economists, the misgivings over the tendency of plaud.

family.

index may not take sufficient ac¬
count of improvements in qual¬

ity: it represents
basket"
tion

fixed "market

cannot

the

make

and

give recogni¬
ability to

consumer's

substitutions

when

certain

the

nation

during

the

1955-57

boom

reserves

abroad

has

other statistical

many of our

to " substantial

subject

are

reservations.

Closely
of the

this

matter

adequacy of our statistical
another question
which
raised.
Why cannot the

tools

often

monetary

authorities

forecast

effectively and anticipate
needs for policy changes, instead
of waiting until a business trend

has

become

answer,

obvious?

fairly

think, lies in

sence

recession

and

promote

re¬

Moreover, the actions of

covery.

conclusive

measurements

The

the

ab¬

statistical

in all

have

movements

lime

Similar large gold

of 1957.
to

time

from

occurred

since

the

conditions.

other

even

let

Many of

series,

alone

but

would

stress

lar exchange standard

International

Better

Economic

Ties
So

have spoken of our
problems
as
if
the
States were living in an

far

economic

United

to the

tent

been

that

dollars

have

a reserve

it should work.

Gold and dol¬

lars are, and I am sure will con¬
tinue to be, interchangeable at the

We all

own.

there

must

always be an element of tentativein our approach.
We can

ness

never

"all out" at the first

sus¬

picion of a trend, but must
tiently watch and probe and

pa¬
re¬

appraise, intensifying
or

pulling back

our efforts
additional evi¬

that

occur

in this

Development Project. The
project will provide the City of
Oslo, by the end of 1960, with an
additional
152,000
kilowatts
of

crucial contribution toward the

the

other

must do

hand,
our

national

operation
financial

of
and

the

inter¬

monetary

system by standing ready to sell
our
gold at the same price at
which we bought it, and by thus

keeping

stable

the

key

relation

between gold and the dollar.

rapid, in this country.

We make

of the rest of the world.

effective

shaky exchange rates and
sharply rising unit costs may
escape a major exchange crisis.
I
can see no justification for such a
plea. We in the Federal Reserve
System are determined to do all
we
can
to resist inflation, either

that

Goodbody

it is clear

best to avoid

gold

standard

must

al¬

came

was

Except for

this

born
in
country

short time

spent in St. Paul, Minn., in railroad
work, Mr. Goodbody's entire busi¬
ness life was spent with the firm
of Goodbody & Co., 115 Broadway,
New York. He was first employed
there 60 years ago

known

1902

1911

when the firm

Robert Goodbody &

became

member

York

Stock

time

partner,

the

New

Exchange and at the

his

death

the

was

senior partner of the firm.
Mr.

Goodbody

Quaker
Meeting
Meeting House

was

and active in the Quaker

Stamford

the

where
held

The strengthening of this inter¬
national

and

1885.

Co. In

was

slow

Mr.
Ireland

always to gain gold at the expense

some¬

Goodbody

Co., passed away May 26 at the
Greenwich Hospital after a short
illness. He was 81 years old.

cial stability if this country were

Goodbody

firm

Exchange

be in the interest of world finan¬

country,

foreign countries with

Marcus

Marcus Goodbody, senior part¬
ner
of
the
New
York
Stock

what

dence becomes available.

Suggests Supplemental

Power

little

example of this is the advice
inflation"

used to finance in part com¬
pletion of Hemsil Hydro-Electric

ex¬

present fixed price—subject only
to minor handling charges in this
know how far this is from reality
and
the
very
limited
and how important our relation¬ country

isolated world of its

tistical

downward.

used

currency) is working

sometimes receive to let "

and

which

of wages and

that it is only a clue; that the sta¬

history of business cycles
is full of false starts, both upward

Oslo
Electricity
municipal
enterprise
supplies the City with its
entire electricity requirements, to

Works,

our

latter will loan the

the

war,

present
future
swings in the London gold mar¬
statistical ships with the rest of the world
ket.
data tell us only what has hap¬ are. As a matter of fact, the rest
of the world is not hesitant to ac¬
Even
after
the
recent
gold
pened some weeks previously, not
what is happening now nor what cuse us, from time to time, of movement, the United States still
giving too little thought to the holds almost $22 billion worth of
will happen tomorrow. There are
international effects of our inter¬ gold, or 56% of the free world's
some so-called "lead" series which
nal policies.
Perhaps an extreme monetary gold stock. It would not
may give a clue to the future of

conditions,

The

and installed
power.
to me they are a
decidedly healthy
prices can be at least
Application will be made to list
sign, showing that the internation¬
important to ultimate recovery
fund bonds on the
al gold standard (a gold bullion the sinking
as
anything that may be done
New York Stock Exchange.
through monetary or fiscal policy. standard, supplemented by a dol¬
labor and management in the area

funds

when fiscal policy could have con-' form of purchases of gold from
tributed more strongly than it did the United States. These purchases
have been quite heavy in the last
to
the

bat

100%

issuance of

proceeds from

of Oslo.

the

taken

prices

foreign exchange reserves of the
Kingdom of Norway and the Nor¬
wegian kroner equivalent of the
proceeds transferred to the City

place

prices rise; and it probably fails
checking of, inflationary
few months, and the total so far
to give adequate weight to all the forces.
More
recently
serious
discounts or price reductions ac¬
questions have been raised as to this year has been of about the
tually available at the retail level the extent to which fiscal policy same order of magnitude as the
under present conditions.
Simi¬ might help in the efforts to com¬ sales of gold to the United States

larly,

Net

the securities will be added to the

too great a
Endorses Gold-Dollar Fixed Ratio
burden on monetary policy — to
To some extent the growth of
expect too much of it. There were
times

The of¬

fering is the first to be made in
this country by a Norwegian mu¬

in their growth during 1957.
Although this pause in growth re¬
flected in part the unusual de¬
pause

mands

made

was

total

again,

June

leading international
currency.
I am thinking also of
the tendency in recent months for

increase

Oslo

loan bonds due in equal amounts

as a

lars—to

loan bonds due June 1, 1973 and
$3,000,000 of 4%%' serial external

preserve

offering

of $11,000,000
(Kingdom of Nor¬
way) bonds comprising $8,000,000
of 5Vz% ;sinking
fund external

events of the last few months. For

memorial service will be

Sunday, June 1, at 3:00
Interment will be private.

p. m.

Selective

exporting recession to other coun¬ ways be of tremendous interest to
With B. C. Ziegler
tries. This is merely another way the Federal Reserve Bank of New
(Special to The Financial Chronicle)
Another problem has to do with of saying, as has been said
so York, acting as we do as the prin¬
FOND du LAC, Wis.—Robert G.
the instruments of credit control often, that the most useful con¬ cipal arm of the System in hold¬
at our disposal. By and large the tribution we can make to world ing
dollar deposits, investments French has joined the staff of
B. C. Ziegler & Co. He was for¬
Federal Reserve System has relied prosperity is
to see to it that and gold for the central banks
on very
general credit controls— steady economic growth, with rea¬ and international financial insti¬ merly with Roger Gormican & Co.
control of the total money supply sonable price stability, is achieved tutions of the world. But I believe
and aggregate bank credit—with a in our own country. I believe our it is of virtually equal interest to
Newborg Office
Credit Controls

responsibility

this

regard

market's] allocation of credit and greater, perhaps, than it
resources

the

should

to the various segments

economy.

This

economy

which

relies for its motivation primarily
on

market forces and

enterprise.

freedom of

keeping with this

Public

City

from

products
growing out of the Suez crisis and
foreign crop difficulties, a large

immediate

outweigh very clearly the
dangers of inflation,
they
still
outweigh
them.

Bonds Offered in U. S.

trading

requirement regulations,
which
is
one
of
the
principal which constitute the only selective
control currently exercised by the
measures used in connection with
our
objective of attaining price System)
may
prove
useful
at
stability. In spite of all the skill times in helping to achieve our
and care used in preparing this goal of steady economic growth.
I hope I have made it clear that
index, the question still remains

and

City of Oslo, Norway

economic

major

nations of the world

foreign

administer

able

extent, be decided. An ex¬
ample is the consumer price index

that

interested in the develop¬

between

the

System

controls—quite the contrary.
is quite possible that the
supplemental use of some selec¬

ties

such

tools,

ment

in the Federal

urge

basis of which important na¬
tional policies must, to a consider¬

our

seems
are

types of credit.

the

quacy

It
who

all seek.

economy we

which was
powerful
though misguided speculative at¬
tack last summer, has made a re¬
Conceivably, monetary policy
might have done better to supple¬ markable recovery, primarily be¬
ment its general credit controls cause
of
tne
United
Kingdom's
with some more selective
determination
controls, demonstrated
to
especially in the area of consumer take such internal measures as
rapid

lar

philosophy, the System has ap¬
plied restraint only when the ag¬
gregate of demand was tending

come

der

gone

courage

recognize the need for a change of
monetary policy when it comesl
One serious

major industry

and

sense

against consumption,

the proportion going into some

System,
in general, will

country

minimum of interference with the

first group have tended

are

equanimity on current
levels of unemployment or on the
possibility of an increasing spread

reducing

city bank reserve
requirements more sharply than
those of reserve city bank re¬
quirements, and the latter more
sharply than country bank re¬
quirements, has not only helped
to reduce, an
inequitably wide

ance

there

with

look

reserve

measures,

vestment

though

cession

series

Incidentally, the action of the
Board

re¬

Such specific

reading

help and is,
in fact, an indispensable element
for
resumption
of
economic
growth.
►
More

strongly to ultimate imbalance of

well as with respect to money and
credit, which will contribute to
the healthy and
growing world

friends abroad.

whether

recession—but it

be of tremendous

can

conducive

ease

Even

the

credit

signs that

that

atmosphere of money

covery.

inter¬

could reasonably

our

Fortun¬

exceed

available

supply

the

last

that

recession
time

Europe

surging

was

1953-54, for
and

other

ahpad
so
minor dip in our
was
hardly felt.
That momentum has recently di¬
areas

were

strongly that
own

activities

the

entire

System and indeed to

the entire country; for there is no

the fact that internal
stability and external stability are
inextricably intertwined in every
country of the free world, includ¬
ing the United States. I trust that
we
in this country will always
have in mind the need for keeping
escaping

minished, in most foreign coun¬
tries, so that they may be more our own house in order, and for
sensitive than they have been in pursuing policies with respect to
several years to economic tenden¬ foreign trade and investment, as

LONG BEACH, N.

Y.—Newborg
at 45

& Co.

has opened an office

West

Park

Skelos

Avenue

with

Basil

resident manager.

William St. Sales Offices
William

Street

Sales,

Inc.

has

opened a branch office at 650
South Spring Street, Los Angeles,
and at 231 South La Salle Street,
Chicago.

The Commercial and Financial Chronicle

(2414)

Continued

from

page

Thursday, May 29, 1958

seasonally adjusted annual rate

880,000 in March to 950,000 in
April. This encouraging gain left
the rate of housing starts some¬

Securities Salesman's Corner
^======5==

EconomyTrends, Problems and Prospects

By JOHN BUTTON

"Don't Take

The American

Anything for Granted"

with the two preceding quarters,
im¬
including the third quarter of 1957

When this man fully
derstood the value, and the

ia this fast moving world I sup- order.

it is unnecessary to remind
tax
that things are not always advantages offered, he bought. The
they seem, and the state- man who bought the unlisted,
ments we sometimes hear are (to speculative stock who said he only
pose

which

anyone

auction

what

put

"slanted"

politely)

write such

column

and

$22
output

has .as its primary purpose

pro-

the

ebruary-March

curities

exceptions

rule.

not

rather

investors

most

truthful, and

basically

ally
are

survey

of the Se-

Exchange

and

Commis-

1 he

merce.
are

figures

expressed

lars and at

the

billions

you

final

tomers don't need you. A salesman
of securities should
combine all

sales

third

times

tell

of his

salesman

situation.

own

has been

for

bankers tell
no

bonds at

that they bought
premium and sev-

Hold 1958 Outing

me
a

eral weeks

have received

their list for study (sent to me by
another olficer of the bank) and I

ThJ

boom.

quite gen-

III.

[Production

and

in-employment

...

Production

Why

much

I told this?

was

Possibly be-

®aues

Employment

commodities

„

dex of non_durable manufactures
The drop in employment connot drop at all — this lis the tinues to be concentrated in durpart of the index that usually able goods manufacturing, which

1957, and April, 1958. The number
of employed professional, techniweek beginning April 21 (47.1% cal, and kindred workers has conQf capacity and the lowest point tinned to increase in spite of the
in ^ years for a non-strike pe- recession, and in April, 1958. was
riod), it rose slowly to 1,334,000 8.2% more than a year ago. There
tons in tbe week beginning May 5, has been a small year-to-year in-

March

oil lion

a fall ol

tell you "I buy

Vic Seixas has

who will

won

everything

nothing but 'blue there is to win in tennis. Vic has
played in 20 Davis Cup matches—
more than any player since Til-

chips'." Or, you have been told
that another investor buys no "unlisted"

securities.

Then

later

den.

Vic

National

was

Singles

while production

$18 billion
The
,.

goods

scheduled

between

the

rate

stimulating

cities has

small

movement

try.

back to the farms. At any rate,
hie number of farm laborers in
April, 1958, was slightly greater
than a year ago.
Surprisingly
No increase in demand for enough, unpaid family workers

steel

from

the

automobile indus-

jng

anticipation

creases

of price
July 1 is reported/

Construction

justment,

dollar

economy
is
selling
and the rate at which it is

above

the

volume
AdHI

was

included

are
.

952,000 in April, 1958,
nearly; 1.5% comparison' with , 1,049,000

declined
and

farms, who

among

after seasonal

March

the

farm laborers and who
in- might have been expected to increase because of the recession,

try is in prospect, and little buy-

between

in the

apparently had the usual effect of

—

slow rise in steel output is being
helped by the seasonal movement
of building and by the demand for
tinplate from the canning indus-

a year.

gap

which

tons unemployment

the highest rate
since the week of March 17. The

dropping by

was

out- crease in service v workers, and

put at the rate of 1,400,000

was

man

m sales, or and for the week of May 12

buy'anymore short term
premium bonds, or he thought he
Billy Talbert, Vic Seixas, and
The net drop in sales for the
had enough of them, and so it was Harry Cooper will be on hand,
economy as a whole has been only
convenient for him to say, "I don't Billy Talbert, "Mr. Tennis," was
$6.0 billion a year, or less than
buy any of them."
(What he Captain of the Davis Cup Teams 1.4% from the third
quarter of
meant
was,
ordinarily
I
have from 1954-1957, twice runner-up 1957.
enough but if something unusually in the National Singles, a i'ourThis modest drop in sales has
attractive comes along I may buy time National Doubles Champion,
led to cutbacks in production of
it.) You must be very tactful in and a member of the 1948 and three dollars in
output for every
handling situations
where
you 1949
winning U. S. Davis Cup drop of one dollar in final sales.
have a hunch that "no" means Teams. Mr. Talbert hopes to bring
"maybe." But don't take it as a along a couple of other ranked
^he drop in production has had
little effect upon general income
given fact that what you hear is players. Mr. Talbert is with Sewhich fell only $4.4 billion a
year,
always what is so.
curity Columbian Bank Note.
Then there is the

in the last week of
1,270,000 tons- in the

366,000 tons

nna

...

April rise m iive of the last eight;
years.
About five-sixths of the
*rise, as is usual this time of the
year, was in agriculture, where
the increase between March and
April was greater than in six out
of the last eight years. But even
non-agricultural employment increased more between March and
April than in five out of the preceding-eight ^ears.

year

between

larger

was

v,
moves us first of all. But steel- accounts; for 57.8% of the fall in
as-Deen production shows signs of a slow., non-agricultural wage and salary
proI pickup. After dropping from .1,- employment
between
August,

nd consumer

•

>}as planned the most active Held SiLnn!-,
high
ay agenda.
II 9%

wish

this banker did not

cause

rfpprpnc

March
than last
and better than the March-

Aprii

and"

0 did
es

Snmv
Jn ? faf
+il
cwJh representing less than
S;n!lSi
sales, have
0nJ
rhe, Entertainment Committee hnwf

10 to 15 points.

construction,
a

H?!vnL ^5,C, -aseS

t),1? ^at ^ bonds bought Hollow County Club, Scarborrecent past at
prem-pugh-On-Hudson, New York,

Withimthe
iumscf

misled

The gain of 596,000

bf the -employment.

than at the peak

cession

„

The annual outing of The lit¬
vestment Association of New York
(for members only) will be held
on Friday, June 27, at The Sleepy

were

who were spending a the rise in the seasonally adjusted
]arger proportion of their incomes unemployment rate occurred in
on goods after six
months~ of ,jre--»the face of a fairly good rise in

an-

than Vive-

have had

figures,

the

consumers

dol-

.nLcS?!"
H irnhil ^rnnHc'

NY Inv. Assn. to

something
I

porting

by cutting inventories'at of the non-institutional population
record-breaking rate. The herdes-of 14 years of age or over in
0f the recession have been
the March to 58.1% in April.
Hence,

quarter

that is not in accord with the facts

for

ones." The' Federal' by

SOrry

«T

yy.v.

report

fjdence

erally overlooked) is the fact that

cus-

tne

wjr

v.'.,-

employment

April; 1958, was neither good nor
recession, bad — it might be described as
played by business ahd "neutral." The newspapers, in re- "

generaf seems to have slowly deeconomy_ (64.0 % in clined between March and-April.
of 1957) have
The index of industrial production
worthy, this business could not the qualities of friend, consultant,
increased slightly during the refunction*
and advisor in regards to invest(seasonally adjusted) dropped two
cession irom $368.3
billion a year
percentage points betwen March
ments. You can only measure up
>Vhaf a Man Says Is Not Always
this responsibility if you are io™_,
and April—not a bad record in
What He Boes
also willing to tell a client not to
f id-«
™°n m♦
*
quarter view of the 12% curtailment of
I am at a loss to understand why buy if your best judgment indi- 9, j
e
economy automobile output to the lowest
aii otherwise truthful and highly cates that he should not do so.
1™™™+ m u fl^ures are gov- level since April, 1948; and a fur-.
goods and tjier
drop in steel output.-The inrespected individual will some¬
were

those who sell securities also trust-

The

Table

seasonally adjusted

recession that

best for them. Unless
qualified to do this your

roles

out

and the Department of Com-

sion

the

are

lost

quar-

than the

The. production of services con¬
tinues to rise.

the Federal Government stand

will
sometimes interest in your clients will you nUmura
The
most
striking aspect
of
salesman, I could hastily b6 able to help them make dethese figures (and an aspect of the
add thaft the examples I am giving oisions that will be what is usuhere

year

average

that prevailed

year

investors

that

make to

1,019,000

in the second half of 1957.

jn this picture of the

all-time high,

billion

the fact that the seasonally adGovernment has allowed its pur- justed
unemployment rate rose
?i?
ln ar.der *° incorpor- chases of goods and services "to from 7.0% in March to 7.5% in
ate the lower estimates of outlays
drop for the first two quarters of April. They overlooked the fact
on
business plant and equipment
the recession, and
business"f has that the participation rate in the
required by the returns from the exhibited an
amazing lack of con- labor force jumped from 57.7%

bit. bought "blue chips" also aprpeci-

liminary figures for the last

bit difficult to

expenditures

were

about

I have revised downward the pre-

ated the opportunity that was olthis, which fered and he bought. There is
the re- always a reason why people do
view of certain aspects of security not buy. Sometimes it is obscure,
salesmanship that will be helpful
A sound approach to this probto men in the business. The sub- lem is to have a discussion, ask
ject I want to discuss with you this questions, and make every sales
week is perhaps a "touchy" one interview a conference between
but oven though it deals with in- two people of good-will. By your
correct and misleading statements attitude of friendliness and your
it is

Sometimes

the first quarter of 1958

compares

below the monthly

what

April.: The
only slightly!n

1957

but

The

•

meantime construction costs

were

ad-

ill
„

Recent.weeks, new.claims for

Tmemployment compensation have

w*!16'

have

producing them has been widen- risen bv 2 2% so the dollar fia- ended April 5 to .403,300 m the
discover, and sometimes Champion in 1954, won the Naing. By the first quarter of 1958 Ures
indicate a small year-to-year:
you will be told by the man who tional Doubles in 1952 and 1954,
:
r:
originally declared that he bought and shared the Mixed Doubles
«anau-?? S OVCr Pr0" drop in the Physical yplqme of .;•> -aiv ^Personal Income
duction was $9.0 billion a year.
construction.
Non-farm ; private
nothing but "blue chips," that he crown many times.
/
He is now
The
Perspnal
income
.figures
for
Federal Government
had just picked up a substantial with Goldman, Sachs & Co.
has
residential construction -in April ^,^e^fq/Paifigures^ tor
failed miserably to mitigate the was down 1%
block Of some speculative, but atcompared with last March;b.ave.beeii reviseclxipward,
Harry Cooper will conduct his

yoft will

...

tractive, security.

famous golf clinic again this year,

but it was

The

Not only that,
"unlisted" and one of

your competitors got the order!
«iw

Sometimes Means

"No" is

triot

"Maybe"

was

the

uncrowned

use

when

recession by stepping up its spend-

cham-

estimates

one

ties>

the

son

famous

British professional and won his
they first prominent tourney in 1923.

servative

give

by the first quarter
was
costing
the
country

construction

was.

salesman

excuse

for not

rose;

The

Jonal

from

that

will

elicit

answers

that

are

pertinent to the real reasons as to
why the purchase is resisted.
Most

people

who

make

give

answers

not valid

objections, do

excuses

evasive
that

are

year

today.

Metropolitan
t

was

Champion
*

in
•

State
2.

aware

that

someone

accept his statement

and who

went

the

who did

I did,
trouble to
as

sit -down with him and show him
the advantages

of buying certain

high premium bonds, obtained

Gross

'purchases

$437.0

$434.1

income'
personal

drop

income

since the all-time peak of last Au¬

5th Quarter
i-iuRu
1958

lu.xr
1957

•.

gust has

$431.0

year or

been only $4.5 billion

less than 1.3%„ but in the

commodity
86.7

industries,

producing

and

36.1

local

private investment._

49.7
37.3

66.5
14.0

;

;;v
i

19.0

19.5 v*

30.5

28.8

3.0

—2.7

3.2

equip..
Change in business inven¬
tories

3. Net foreign investment
4. Personal consumption ex¬

penditures
Durable

goods

232.4

35.0

II. Total production
III. Excess of expenditures

wage and salary
bursements
have
dropped

dis¬

19.0
27.5

: ;v

—9.0

140.8

106.1

107.2

440.0

those
small

•

-281.2

31.5

431.4

Table

there
II

have

there

and

been

those

have been increases.

these

presents

results.

The figures are in billions of dol¬

"141.5

lars

108.2

which

decreases,

-which

a year,

1.5

•

$8.1

7.9%. The econ¬
omy may be divided into three
parts-—those in which there have
been fairly.' substantial decreases
in personal incomes since last August (decreases of 3.0% or more),

114.3
£;

34.4

142.5

billion

51.8
"

283.6

Non-durable goods
Services

con¬

centrated,

'38.0

2.0

durable

where the recession has been

60.1V-5
14.5 "

Producers'

87.5
49.5

87.0 .'

50.6

Other construction

1955.

with awards of ten sterling silver

total final sales

Residential construction

4th Quarter

oor'

s^^ ^^^

the

they are not cognizant of the adInvestment Association of
vantages Of buying instead of re- New York Golf and Tennis Chamfusirig. In the case of the banker, pionships will be held as usual

Government

goods and services.

was

winnings

because

Federal

high-money winner
on the circuit taking down $14,000, an equivalent to over $65,000
in

Expenditures
•

income

The
j*>4">7

nrinr^

agricultural

I
3rd Quarter

honors but lost in the play-off to

^Miion Jbove"Xnr1l 1^5?

down ;

public

Private housing starts

TABLE

buying which is not the real rea- some fellow named Tommy Ar¬
son they *do not wish to
buy. Of- mour. In 1936 Harry Cooper was
ten, this real reason is not fully the first to break through the 30
understood by them and it can year low U. S. Open score of 286
only be evaluated when the sales- with a 284. He held the record
man -digs into the situation with
a
for 40 minutes only to become
series of well designed questions Runner-Up once
again. The next

not

2%;

utility construction
was up 7%; and total public conof struction up 5%. -y j;
v
r v

recession

1958

mercial

normal

economy at the conrate of 3% a
year, the

ask to

"buy." It is the same In 1926 he won the first Los
with., everything from
cars
to Angeles $10,000 open with a rechotises, television sets, and securi- ord breaking 280. In 1927 Harry
ties. Many people will, however, Cooper tied for the U. S. Open

the

Piou of The 'Twenties and 'Thir- growth of the

showing an increase > over Feband Apnl personal income

year; private industrial construetion was down 25%; private com-

pa-

word that many peo-

pie do not like to
are

good doctor and ardent

seasonally adjusted annual

rates.

"422.0

final

will

observed

the

that

aiany other prizes,
Grand Challenge Trophy

with replicas is displayed at The
Lunch

Club.

sales

IV.
V.

over

total production...

—3.0

.-2.7

Personal income

346.9

345.5

Disposable income

303.3

302.1

VI. Personal saving
(The

sum

the

sub-totals

9.0

\
v-

three sectors of the economy were

342.5

roughly of equal size last gugust,
but that the parts in which per¬

300.1
'

19.7
may

not equal

19.8

18.9

the totals because of rounding.)

sonal ; income
more than 3%

have
are

dropped

less than

one-

Volume

third

187

the

that the

total

The

available

not

permit
of

come

from

The Commercial and Financial Chronicle

March

and

economy,

the

income,

but

agricultural

was;

ment

some

other

risen from

the

annual rate of $16.2

billion last August to
in

April,

recessions

loans

spite

-often

the" stability of total personal' in¬
come and
by a drought in the cat¬
tle
country
and 'freezes in the

year

which,

luck,

at just the

came

matter

The

concentrated nature

perhaps

the most

ures

that

they

indicating

were-

partly

confidence

consumer

ex¬

installment credit for

purchase of

automobiles

has
pur¬

table shows.

itself.

"v;,;

■*, i r.i*;#

■/

following

figure in table

in millions of dollars

are

sonally!ad justed.

the

-as

The

,...

Re tail'-Sales and

Consumer

VI.

...

Credit

kMv'h;-;;v

Construction contract awards in

important-economic* gain-in
April was the rise of 2% in retail

March,-; 1958

sales, adjusted for seasonal fac¬
tors, over March.- Retail sales as

whole

1957,.

sales

durables

the

April,

soon

■

period, largely be¬
purchases": of

disappointing."

below

manufacturers

April

contract awards

con¬

are

re¬

inventories

book value

value

book

tories

less

now

ago.

than

inventories

for

123.3

?enc? irJ.

the

The

shows

recent

March,

but have been

jias

the

going

this

ratio

increaseci

for

selected

significant than the ratio

of inventories to deliveries

ratio of inventories to new orders

There is

The

the

that

ratio has shown little change since

showed r little

April

there

both

was

March

were
more

days

definitely higher in the last two
months

improve¬

small

and

April

inventories

low

in
that

drop
and

May

low;

in March.

The seasonally ad¬

justed reduction

seasonally

consumer

adjusted

installment

drop

credit

ending

above;

and

little

break

for

going

over

But the drop in new orders

February and March was
considerably less than in the two
preceding

with $3,255 million a year ago.

The

18.2% be-

weeks

between

Repayments in March, 1958, were
high—$3,426 million in compari¬
son

five

.31,"14.1%

with

year.

$246 million.

was

the

in new orders that has been

indebtedness,

which began in February, contin¬
ued

continued drop in new orders,

January.

orders,

months.

Association

The

Table

selected

shows

the

for

recent

months.

•

National

Parts of the

Economy

Showing Decreases in Personal Income

August-April of More than 3%
August, 1957

April, 1958

(wage

salary payments)
incomesI_L_-„_____

$102.8

$94.7

7.9

8.0

7.7

Aug.

Dec.

Feb.

1957

1958*.

1958

manufacturing and trade
All manufacturing
Durable goods
Non-durable goods

1.56
1.82
2.12
1.51

1.60
1.88
2.20
1.56

1.60

1.66

1.67

1.71

1.72

1.90

2.00

2.05

2.22

2.37

2.43

2.53

2.56

1.57

1.65

1.63

1.64

1.68

All wholesale trade

1.10

1.13

1.12

1.17

1.18

1.19

1.20

1.50

1.48

1.60

1.74

1.74"

1.81

1.78

.86

.87

.38

3.8

—

$110.8

$102.4

.89
1.46

1.43

1.45

1.47

1.51

1.50

1.88
1.24

1.93

2.04

2.05

2.20

1.17

1.16

1.17

1.19

Dec.

Total

$64.7m

$63.4
'.

! 51.7

——J

$116.4

■

...

—
—

•

April, 1958

Percentage
Change

Government

(wage

!_
and

payments)

Personal interest and

!_!

$33.7

$34.4

2.1

40.5

40.8

0.7 1

31.6

31.8

•f

25.4

2.13

2.17

2.18

2.73

2.86

2.85

1.58

1.64

1.63

1.64

1.66

$132.4

4.3

Week Endings

Extensions

March, 1955
March, 1956

March, 1957
March, 1958

Automobile

Paper

$3,192
3,286

Farm

and

1958

1957

ii>57

118.9

118.4

117.0

3,426
3,193

1,374
1,077

Aug.

—

119.5

119.3

119.6

119.7

99.8

—

products

Commodities

Feb.

1958

97.2

99.4

100.5

95.5

93.0

88.8

112.9

115.5

110.5

110.7

109.0

196.8

103-9

other

products

foods

....

125.4

125.8

125.6

All

125.7

125.8

126.0

125.5

VII

41*0
40.2
42.5
41.4
42.7
42.7
43.9
42.1
40.4

0
41-8-

40.2

Personal

Housing

zation Loans

Loans

Medical

$873
,

banks

the

the'JjL

fall below $500 million,
ending May 7 free

Reserve)

(excess re¬

minus borrowings from
week

million. Ex-;
cept for the week starting May 5,,
the bill rate has been regularly
below

$572

were

1.25%

since

the middle of

„

March.

Shortly after the middle /
of April the prime rate was reduced by the large banks from 4% *

to 3.5%.

Reduction

and

commercial

the

week

April

ending

$29.7 billion in the week ending
April 30.
In the corresponding 1
period last year these loang rose
a small amount—$76 million.
The long-term market continues

remaining

borrowings
levels.

Prices of

which

showed

little

movement

from the end of January

middle of April,

High

seasoned bonds,

until the

have moved up

The Dow-Jones index of 40
Aug.-March

40-?

items

Goods

slowly in the last several weeks.
TABLE

Moderni-

$107

$828

Personal

901

128

931

Reading and recreation—

931

123

998

981

115

1,020

Transportation
—
Other goods and services

Other Consumer

overall gain of 2.5% a
productivity is what the
economy has been able to accom¬
plish. And yet, because the,union
year

1 to show somewhat different maovernents from the short-term with

March

1958

Food

$1,384
1,326

Feb

Apr. 8

1958

Repair and
Total

since,

-Month of-

Apr. 29

Apparel

III

a year, is all that the union
would be entitled to in any year—

1938

+ 19.8

$127.0
table

nearly

2.5%

1.99
2.40

Feb.-March

Total

automatic wage increase of

iSS rapidly, falling from $30.4 billion

0.6

21.2

dividends

Transfer payments

than farm

salary
'i-*:'

1958

May 13

Processed foods

Service industries (wage & sal¬

1.99
2.38
1.61

All commodities

August, 1957.

2.24
1.56

Feb.

1958

Dec.

(
— 1.5
Personal Income

August-April

payments)

goods—

1.90

2.12
1.49

Jan.

1957

Aug.
1957

0.8

'! $114.7

Parts of the Economy Showing Increases in

ary

Non-durable

2.0

51.3

%v Union. This canits provision far an

porting member banks continued

June
1957

1.80

manufacturing

Durable goods

Proprietors* and rental income!

All

Mar.

1957

TABLE

Percentage
Change

(wage &

salary payments

April, 1958

with

industrial loans in the weekly re¬

1950

Vv•..

General Motors has

Un£rTnSS

! !
tract,

1.18

TABLE

August, 1957

.87

.85

7.6

August-April of Less than 3%

Distributive industries

fact that

offered to extend its present can-

reserves

.86

Parts of the Economy Showing Decreases in Personal Income

by some
and government offi¬
restricting the demand
for goods is a feasible way of pre¬
venting wages from outrunning

serves

1.84
1.25

—

Durable goods

that

of the member
Jan.

1.47

goods

All retail trade

false

the

economists

2.07

—

last year

urged

Mar.

1957

Non-durable goods
Total

refutation

claims

The ex-'*--

recession

1957

Non-durable

and

April,

1950

Durable goods

the

goods

heart

Commodity producing industries
Other labor

very

Mar.

—

Percentage
Change

durable

Dec.

All
ii

that wage

TABLE

Purchasing Agents
in reports a small improvement in
in new orders in April over March.

table

strong

1958. Even is
strong and because there are
manufacturing,
advantages in contracts of two
the recession,
years or more, the company, .in
where nearly three-fifths of the
spite of the recession and in spite
drop in employment is concen¬ of
-severe
unemployment in the
trated and where the unemploy¬
automobile industry, offers a sub¬
ment
in
mid-March
was
13.8%
stantial wage increase.
(1,200,000 unemployed in com¬
parison with 8,690,000 at work),
VIII. The Money Market
earnings increased from $2.21 in
During the month of April thq
August to $2.24 in April. These Federal Reserve increased some¬
increases occurred in spite of the
what its pressure for easy money.
In only one week did free reserves

inven¬

ratio

order

indicates

recession

1957, to $2.11 in

safe conclusion that the liqui¬

tory-new

index of wage rates

States, but the rise
hourly earnings right through

the

dation of inventories will be over¬
done.

quarter

hourly earnings.

perience

cials

the recession is concentrated, have
increased from $2.07 in August,

would

rise

No-

are
rising.
Thus, hourly
earnings in manufacturing, where

small rise in new
conjunction with the
drop
in
inventories,

continued

quarter of 1957 4
of 1958.
X

first

employment rates do not halt the

Food

rates

this

since

a,-/

<vr-a

(2) Where unions are as strong r
they are in manufacturing and ;;
construction, even very high un¬

the United

figure has significance only
for manufacturing. In spite of the

intermed¬

and

consumer

period

—a

sharply reduce the inven¬
tory-new order ratio. In a reces¬
sion such as the present one in
The efforts of the government
to speed up the placing of orders which consumer confidence is high
had not in March arrested the drop and business confidence is low, it

showing of re¬
whole is significant

short-term

iate-term

corresponding

the five weeks ending May 5, 9.2%
below.
2 V

in view of the fact that the reduc¬
tion

March

about 800,000 cars, or slightly
than two months' sales.

sales

the

last year; in February,
.

The rather good
tail

whole relative to last

as a

the

over

dealers'

rapidly

price

last month, for the entire receseion> and forthe last three months.

is the

earlier part of the year than in January and Febru¬
month.
Estimates of automobile ary. In January engineering con¬
inventories differ but they agree struction awards, were 24.3% be¬

ment

last

erroneous.

Anrtllof

the

and

i£~S ifthe

was

rapidly than food prices, and
February
and
March
there was a rise in all principal
productivity.
categories in the index except
The ability of unions to exert a
apparel. - Table VII shows
the
strong upward
push
on
wages
percentage changes in the princi¬
even in recessions is illustrated
by
pal categories of the index for the
the

the

a"f due

consumer

total Gross National
<™ :!'
current dollars) dropped 4.1% be- ';
tween the third

August
August,

months.

i_„-_

between

Table

recession.

sug¬

Personal in¬
come dropped only 1.3% between
August and April, but industrial
production dropped by 11.7%,be-

vember, having decreased between
August and November, but be^ween August and March several

of inventories to de¬

throughout

between

price Qf food js

inven-

the recession began.

completing

widespread impression that

™

figure which the Department
of Commerce neglects to compute.

months

recent rises in the

some

yirtually halted the rise

ratio

0.7% to

rose

economy, categories in the index increased

reduction

development t>f

inflation.

March, 1958, personal
higher, relative to:
production, than in August when

1957, and March the consumer
price index increased 1.9%.

edly. soon be cut-thus reducing
the most powerful, single defla.

price index

(1947-49 = 100),

LL„

rate of reduction will undoubt-

rapid

the

income

thl%risJhbu[enof2vn2u?hreinrdthe

months^afterpresent record-breaknew orders begin to
but the

The

7.5%, and since March, 1957,

was

rise,
lng

for

theory

consumer

(1) A limited recession, such as
present one, is ineffective in
reducing prices because it cuts

two years of almost unbroken rise.
The increase since March, 1956,

Past experience indienterprises will continue

reduce

in the

rise

gests, among other things, the fol-<
lowing:

significant, and during the

consumer

was

the

Between February and March the

inven¬

trade

nificant

seven

ported to have .run well above the

have' been erratic,

Sales

1957.

During the last month the
the prices of commodi¬

slow

come.

turing and durable goods retail¬
ing, where the inventory problem
(though riot serious)
has been
and

The

production more than it cuts in-

and
dropped by $800
especially
large in durable goods manufac¬

The

and

slight rise

dex.

of manufacturing

manufacturing

small

are

rising. Table VI shows the behavior of the wholesale price in-

The drop was

concentrated.

unions

the

trade inventories
million.

the

first 12 days of May the index of
22 sensitive commodities has been.

The

month of the recession.

any

to the combination

ties other than farm products has
shown a slight drop, but too small

end

than

March

where

have

price index and in hourly earn¬
ings during the recession is sig¬

index

$64.2 billion in December, 1956.
Business made larger reductions

which

come.

pro¬

at the

products,
due

temporary reductions in supply
(mainly the result of weather)
and
well-sustained
personal in¬

comparison with the recent high

abnormally low figures for April,

One

sales

below

which,

farm

of March, stood at $46.6 billion in

liveries which has been

November, 1957.

struction

19572;
..V ':
Engineering construction awards

3-1.7%

orders

new

reduction in weekly hours which

known, the 'indexes

weak, there has been
in hourly earnings.

large drop
($1.2
in the unfilled orders of

tones has

estimate puts them at 362,800, or
29.7 % below .April,,1957. In March,
were

another

duced

put contract; awards in March,
1958, higher, on a seasonally ad¬
justed basis, than in any month

Sales of automobiles

were

over

Wages, and Costs

well

increased

of deliveries by man¬

excess

ufacturers

since

1957. Sales
8.7%

11.6%

-were

March, 1957. But contract awards
.March;f 1957, were unusually
high! Hence, the drop of 11.6%

smaller,

automobiles.

April

•*.:

non-durables

down

were

12 months'

cause

below

4.0% above April,

were

0.4.%

were

but

ma-

higher

were

•

De-

orders for

new

tools for the 1960 models.

cates that

Contract Awards, New Orders,
:
And Inventories

the

from

levels

Prices,

has meant fewer opportunities to.
Gf wholesale prices have shown earn at overtime rates. In build-* 1
little movement during the pres- inS construction hourly earnings !f
ent
recession.
The
principal rose from $2.96 in August to $3.08 4
in
Even in retailing
changes have been in the prices ~~ February.
™
^ *
As

month since last Auautomobile companies
be
ordering machine

The

gust.
will

VII.

than in any

year

"■

sea-

low

chine tools in March

consumer credit

As compared with

changed' little,

the dll

that

and

in March of the boom

—-

increase

But

ce.aber.

in March* billion)

1956

year

credit

substantially," and extensions for
repair and maintenance loans have

important

show

installment

large

month

sive

The
new

chase of other consumer goods and
for personal loans have increased

and

reces¬

is not feeding on

slightly in

dropped, 'extensions for the

aspect of the personal income fig¬
recession

purchase

recession,

partly use of

the

sion, - shown by the figures on
expenditures and on employment.
But

boom

1955

tensions. of

the

Install¬

March, 1955, and March, 1956,

right time

it confirms the limited

the

same as

and

personal income is significant be¬
cause

a year

goods and for per¬

to meet needs.

of the behavior of

pattern

high level of

to sustain farm income.
-

the

pure

the

confined

paper.

Increased

about;

were

suffered severely. Agriculture has
been helped in this recession by

South

largely

for

consumer

extensions

agriculture ' has

credit

12-month period.

$17.0 billion
rise-of 6;3%
In* past

pretty

credit

sonal

payments

'installment

to new automobile

dividend

tools, though

exceptionally

ago

income

(which includes

and

for machine

Orders

small, increased in March to 28%
over
February—the third succes-

the corporate part of farming) has

wage

March, 1958, compared with

proprietors

proprietors' and rental

whole

same

sions "of

economy.

monthly figures do

agricultural

about the

was

(2415)

February — $180 million in com¬
parison with $166 million in Feruary.
The drop in the new exten¬

separation of the in¬

total

5746

expanding parts-are well

one-third

over

Number

care

—

care

40-3
40.2

40.3
40.1
40.2

Dec.-March

has

41.4
—0.8

44.0
40.4
41.1 '
41.0
42.1
—0.2

40.3

risen from 88.79

to 90.15 on
a

fall

bonds

April 14

May 12. There has been

the

new

issues of cor¬

porate bonds and preferred

stock

awaiting marketing from the Jiigh
levels
March

over

billion late in

and early in April to

Continued

$1.6

page

The Commercial and Financial Chronicle

(2416)

Continued

The

from page 27

for
are

Economy—

The Changes in Investment

government to promote stability
in the industry.
The most useful

is of such a nature that the indus¬

May 9 and the same on

The technology of

Plans of Corporations

from

try

1957 and
the Spring of 1958 the investment
plans of business for both the
a ears
1959 and 1960 underwent
Important downward revisions.
T he McGraw-Hill survey of in¬
vestment plans provides estimates
cf the sizes of these
revisions.
Between the Spring of

from

away

and

industry possesses excessive
productive capacity because, the
cutbacks are general.
General

not sell

cise tax.

the industry

raised

differential ex¬
costing $3,500

cars

excise
10%

the

tax should be
25%.
This

from

would

people

who wish
business
enterprises and public bodies that;
wish to buy expensive cars for
prestige reasons to pay a little

two to three years
its market — that is,

require

important changes in models need
to be frozen anywhere from two
to three years in advance of the
models being put on sale. In spite
of this fact, the industry has at¬
tempted to develop the automobile
as a style good. It has placed great
Table VIII provides a summary emphasis upon year-to-year model
of the McGraw-Hill Survey.
changes. Automobile engines are
The cutback in planned expen¬ poor
engines
by
engineering
ditures on plant and equipment is standards, and it is a long time
since significant engine changes
a national calamity.
The cutbacks
But engines do
cannot be justified on the ground have been made.
that

Strong steps are needed by the

its step would be

nology of the industry
marketing policies.

IX.

style

leaders and

for that

privilege.

The ex¬
tra
payment for the privilege
should go in large part to tne
government, not to the automobile
more

manufacturers.

A 25%

excise tax

expensive models would pro¬

cars

the

intermediate

price range from $2,000 to $3,500
the present excise tax of 10%

might well be continued.

cars.

The

The technology of the industry

government and much of business
that the central problem of the
economy in 1957 was inflation.
There has not yet been an ade¬

quate opportunity to explore the
possible causes of this deficiency
of demand,

the

industry to achieve the
advantages of selling cars at prices
to which the excise tax would not

National Financial

drop in the rate of invest¬

ment.

Among the possible causes

the

deficiency in demand in
need of exploration are: (1) the
failure of

the

consumer

dustrial

makers

durable

goods and of much in¬

equipment

stimulate

demand

Analysts Elect

emphasize many features that the
L. Hartley Smity, Dean Witter &
public has found distasteful in the
Los Angeles, was elected
1958 cars, will meet a favorable Co.,
reception. If they do not, there President of the National Federa¬
tion of Financial Analysts Socie¬
is little or nothing that the auto¬
mobile companies
can
do about ties, succeeding Gilbert H. Palmer
of Cleveland. A. Hamilton Bolton,
were
pretty
what the auto¬ Bolton, Tremblay & Co., Montreal,
was elected
Executive Vice-Pres¬
mobile
companies
thought
was
public taste back about the end ident. Mr. Bolton, the first Cana¬

it.

These

by improving their prod¬
ucts; (2) the effect of the over¬
doing of credit restraint; (3) the

much

effect

models

of 1956.

of government cutbacks in
defense orders; and (4) the effect
of the drop in net
foreign invest¬

ment.

The accidental conjunction

of all of these influences
may have
had much to do with creating the

♦deficiency of demand that led to
cutbacks in
reductions
in

investment plans and
inventories which,

turn, brought
The

Recession

the recession.

and

the

Auto¬

the

automobile

well

victim

dian
tion

need

will

permit the industry to make
in its models to

the

executive

posi¬

organization, will be
the

1959

convention

meet shifts in

the

reces¬

sumers

and

preferences of
offer

wider

con¬

Max

Graff is

vestment

continuing the in¬

business

of Townsend,
Co., from offices at 25
Broad Street, New York City.

Graff

Firm Name
S.

maladjustments between the tech¬

from

metal

dies

The
&

in this direction would be

plastic

Changed to
Weinberg, Grossman

firm

name of S. Weinberg
Exchange Place, New
City, has been changed to
Weinberg, Grossman & Co.,

Co.,

York

shift

dies.

Inc.

TABLE VHI
j

)

•

!
v

ALL

Y-W
j * ' J
t ' ' I

r-1059 Investment Plans->

As of March

MANUFACTURING

As of April

April, 1957

1958

$11,057
1,102

Nonferrous Metals

/-19GO Investment Plans-,

Percentage
Change

As of March-

As of April

April, 1957

1958

Percentage
Change

$9,138

—17.4

$10,601

$9,178

—13.4

733

—33.5

992

748

—24.6

353

339

—

4.0

293

305

Machinery

940

887

—

5.6

938

916

Electrical machinery

712

604

—15.2

762

652

Autos, trucks, and parts
Transportation equipment (aircraft, ships, RR. equipment)

—14.4

803

638

—20.6

803

651

—18.9

Iron and steel

Other

Petroleum

333

—19.8

369

300

—24.4

854

656

—23.2

1,349

—21.6

1,651

1,349

—18.3

$24,854

$22,184

—10.8

$24,166

$21,430

—11.3

5,604

—10.8

6,081

5,407

—11.1

^44

—30.9

299

224

—25.1

168

—41.7

153

—49.0

5.8

6,276

;

'353

Coal

_•

_____

ore

Non-ferrous

Nonmetallic

Railroads

Other

transportation

1,129
and

munications—

796

5,590

4,053

Electric and gas utilities

5,238

7,178

5,733
6,491

$35,911

$31,322

5.8

—50.0

able

were

bank.

Some

later, when their advertis¬
ing campaign on Rybutol took
fire, their sales grew so rapidly
that they
for

out

back to

came

Rexall

again

of time until

period

sold

they

Drug for $5,-

—29.5

1,152

868

—27.5

5,950

9.6

5,113
6,317

4,372
5,339

—26.5

+ 9.5
—12.8

$34,767

5,972

$30,608

+
—

A substantial

being

portion of the
had to be bor¬

price

purchase

Even though the business

acquired was a profitable
the local bank did not feel

that it could lend all of the funds.

Furthermore, while the local bank
confidence

the

manage¬

ment,

preferred to see how
they integrated the new opera¬
tion before inviting participations

from its

correspondent banks. In
conjunction with the local bank,
worked

out

loan sufficient

acquire the stock of the

new

corporation.
Our loan was se¬
by the stock of the com¬
pany being acquired, the accounts
receivable and equipment of the
cured

and

borrower

of its

some

inven¬

The bank participated with

tory.

in this combined loan.

Most
frequently
finance
companies are called in to partici¬
pate with banks where the spe¬
cialized
lending techniques and
procedures of a finance company
are
required to properly super¬

(2) By taking

over

from banks

certain accounts that present spe¬
cial problems. Where a bank cus¬

frequently
nance

turned

over

fi¬

which, through
close supervision and guidance, is
able-to help the account in elim¬
company,

inating

the

losses.

The

account

vise and control the collateral and

the

bank

not

position to

render such service.;

Where

banks

participate

with

finance companies, the; bank gen-?
erally retains the "deposit rela¬

continues doing business with the
finance company until it Is again

tionship, and the finance company

worthy of bank credit, when it is
turned back to the bank. A typi¬

cal

company.

which

case

that

store

comes

large

to my

mind

ladies fashion
on its

which showed losses

statement because

year-end
to

move

new

quarters, which dis¬

rupted its normal

business;

The

bank, which had been making an
unsecured loan, felt uneasy about
the account.
the

both

began to
and had

recouped
its
losses.
The
bank
then stepped back into the picture
an

unsecured

wholesaler,

doing
an
annual volume of about $10
million 011 a net worth of $1*2
million, was borrowing in a sub¬
stantial six figure amount on an
unsecured

bank.

basis

from

Dissension

the stockholders.

its
in

set

local
among

of the
managing
stockholders,
owning
less than
V2 of the outstanding
stock, obtained an option to pur¬
chase
the
remaining stock for
cash. They could raise only part
of
the
purchase price and re¬
quired an additional loan to close

group

its accounts receivable.

bank's

The

unsecured

bank

loan

was

retained

now

the

doing busi¬

directly with the client.

Similarly,

receivable,
joint account of

the

bank

the

and

finance

TJie bank thus receives

benefit

finance

the

com¬

services in

su¬

pervision of the collateral, par¬
ticipates in a secured piece of
business,
and
yet
receives
a

charge

which

usually

higher

than it would normally earn.
Nature

the

Techniques
Finance
With

Companies

regard

specialized

should

com¬

panies very frequently participate

the

receivable

some

techniques

commercial
company,

Specialized
Commercial

the

finance

em¬

phasize the difference between
bank's attitude toward

basis.

Another typical situation is the

accounts

pany's specialized

revolving line of credit, secured

011

the

trustee for the

into

called

were

handles

situation, and arranged for a

(3)

net worth almost the size of Its

own.

(b)

stepped in and is

5.5

—12.0

ness

4.4

wanted

for bank loans.

repaid.

—24.7

manufacturer

000,000 and again became eligible

deposit relationship and stayed
very close to the account.
The
management, free from dissen¬
sion, applied itself to increasing
sales and profits. Within one year
they showed such a credible per¬
formance, that the bank again

—39.6

—

over

while

The

8.3
+30.0

—

where

turn them

cured

com¬

Commercial
All INDUSTRY

—

size

situation

such

buy out another business with

to
a

had

in our sit¬
uation
with
Vitamin
Corp. of
America, we started with them
when
they
were
small.
After
several years they had grown to
as

quickly formulated a plan under
which we temporarily advanced
the funds to purchase the stock of
the
retiring
stockholders.
We
then arranged to convert the loan
into one to the corporation, se¬

—18.7

631

NON-MANUFACTURING-

Mining
Iron

1,720

Chemicals
TOTAL

2.4

One

alone.

follows:

one,

Frequently, such

situations,

(a) Where ihe account is too
large for the local bank to handle

worked with the finance industry.

they grew, they became eli¬
gible for direct bank accommoda¬

Field

various

such as:

Chemical,
etc.
were
compara¬
tively small companies when they
As

banks

with

rowed.

deal.
The bank felt uneasy
and wanted to be repaid. We were
called
into
the
situation.
We

415

By nurturing and helping
of small companies
until they become worthy of bank
credit. Remember that the large
public companies I mentioned be¬
fore,
such
as
Dow,
Monsanto
growth

the

+ 4.0
—

834

metalworking

banks in

ways:

(a)

the

following:

va¬

major step

sion, it is desirable to examine the

closely with

very

following

two years the company
show substantial profits

Max Graff Continues

riety of models to meet the pref¬
erences of
large minority groups
among consumers. One

the

ours,

accounts

prompt changes

industry,

work

such

by the store's budget and charge
receivable. In less than

which is to be held in Montreal.

taken

by the govern¬
ment. The industry needs to
put
its
engineers hard at work to
change its technology in ways that

hold

chairman of

industry. Some of these steps need
to be taken
by the industry; others

through its technology and its pol¬
icies, has been an important ag¬
gravating cause of the recession,
as

Drastic steps are needed to re¬
duce the instability brought into
the economy by the automobile

mobile Industry

Since

frozen

companies

nance

banks, fi¬

apply.
And the advantages of
tomer^ for temporary reasons, in¬
keeping the costs of some cars low curs losses or where the account
enough to escape the excise tax cannot normally clean
up, it is

but there is no prob¬
would stiffen the resistance of the
confronting the economy that
manufacturers to excessive wage
is in greater need of study. Upon
demands.
the understanding of this prob¬ ness and longness of the cars. One
lem
depends our ability in th^ needs fq be prgtty much of an
future to prevent the economy's acrobat to get out of a 1958 car.
being thrown into a recession by No one has the slightest idea
a deficiency of demand and a gen¬
whether the 1959 cars, which will

lem

tion to borrowing from

the

able

majority. But recent ex¬
perience shows that the tastes of
the majority are unpredictable. In
1955, everyone was surprised by
the rage for the new two-color
models.
In 1958, everyone was
surprised by the revolt of the
public against fins, wings, head¬
lights, and the inconvenient low-

Role in Present Day Lending

tions.

vide this result.

industry should be given
is such that the companies are strong encouragement to produce
over-capacity is simply another able to offer little more than su¬ a good stable product at minimum
name for a general deficiency of
perficial variety in cars.
Large cost—a product that would not be
demand, and a general deficiency minority groups of consumers who changed in style and design every
of demand should not be tolerated. would like cars of different di¬
year. Such encouragement would
As a matter of fact, there was a mensions or different character¬ be
given by completely removing
deficiency of demand in large istics are unable to obtain them the excise tax on all cars costing
parts of the economy last year be¬ because the technology of the in¬ less than $2,000. Long production
ginning about January—in spite dustry requires that the companies runs
with
infrequent
design
of the erroneous diagnosis by the concentrate on
meeting the desires changes would be needed to en¬

eral

page

before.

16.

from

Commercial

urgent than ever

become far more

Trends, Problems and Prospects
billion

Continued

Thursday, May 29, 1958

this problem for years.

The American

May

industry has been working on
The need
developing plastic dies that
satisfactory for long runs has

account

and ours.
The bank looks pri¬
marily to the financial statement,
the net worth, the working capi¬

tal, the ratio of liabilities
sets and whether

not the

as¬

com¬

has been operating profit¬
Quite properly, the lending

pany

ably.

officer

who

accountable

directors

board

and

the

bank

examiner, must rely largely

upon

these criteria.
The

commercial

finance

com¬

the other hand, while
taking these matters into con¬
sideration in making the loan, re¬
lies primarily upon the underly¬
ing collateral.
The commercial
pany,

Executive must always
himself, "while I expect that
this company will stay in business
and operate profitably, if it should
become insolvent, can I be fully
repaid out of the security I hold?"
finance
ask

This

tailed

requires, therefore, a de¬
investigation of the moral

character

the

management

the

prospect, the acceptance of
its product and a complete analy¬
sis of the underlying accounts re¬
ceivable

being assigned.
Before
going into an account, the com¬

mercial

finance

makes

company

extensive investigation

through
agencies, competitors,
suppliers and others regarding the
company, its management and its
product, and it checks "through
our- Association
Interchange Bu¬

mercantile

reau

double

sure

that

hypothecation

there

the

re-

Volume

Number 5746

187

The Commercial and Financial Chronicle

(2417)
ceivables.

generally
trained

full

auditor, who is
time, especially

employee

the

company, tnen makes

audit

finance

complete
investigation
at
the

:and

eral

financial

conditions

company, but

the

detailed analysis

worthiness''and^Davini^habits'of
recetva'bfes

the
tne

served.

the

prospect.
A
check is made not only of the
statements, the reports and genpremises

trends of the business as to sales,
gross profits, expenses, turnover
of receivables, ratio of sales _to
inventory, etc. are plotted and ob-

nereentael

receivables, the percentage
tne

of
or

returns, allowances, claims, defects, etc. The experience of the
particular applicant with its bank

;

[V, ' '

Over the years a

large body of

ever-changing laws and decisions
have

developed

states

which

various

the

have

watched and adhered to.

closely

Our

own

client. We too take this into
sideration—but once again,
mainly

the

upon

their

full time and

supervision

phases of

atten-

all

legal

operations and

our

as-

se-

"Every employe and prospective employe should
free, without coercion or intimidation from
any
source, to join or not to jojn a labor
organization

If the transaction and underlysecurity are sound and the

and to maintain

"Where

Because of this

we must necesourselves to financnniv

orate

will

rn?
snoUde?er£

not

change

stvle

whether the funds to

the

put

finance

constructive

able

tatives of his

use

panies and its attorneys carefully

Zlled \Z mole.fem

watch local decisions and changes
in the laws> and call them to the

sugar,

Bear in mind that many of our
clients are small- and mediumsized companies who do not-have
the services of specialists in the

which

large corporation

ford.
a

The

doing

smaller

business
can af-

client

may

good production man or an able

salesman,

seldom does
he also possess the ability to plan
ahead, to think in terms of proper
marketing, merchandising, advertising and balance sheet ratios.
but

Continuous

very

Supervision and

Control
rp.

The

finance

musl.not

today

company

only lend[moneybut, in

^ .' 7'.'"7?L„ to render
,ay
close to the client
advice and

assistance

such

Moreover, the finance
must
continuously
supervise and control the under¬
lying collateral. :>
/
/

necessary.
c o m

pa n y

Since the finance company's ad-

generally

80%

the

All

less

are

amount

this

detailed

and

exten-

sive

supervision requires trained
specialists
and
is
extremely

Unless

costly.

the

bank

pared to do the entire job

tensively

cialized

pre-

ex-

finance

it is done by the

spe-

company,
the
might well ask
themselves whether they are not
being lulled into a false sense of
security when they take an as-

jink's

officers

signment
as

accounts

inducement

receivable
extend

larger line of credit than the balance
sheet
and
general
background
of the
company
would
justify.
In
those
cases •. where

banks

and

even

j)anjes

have

failed

cl,te

the

finance
to

com-

fully

than

the

ac-

ensued,

covered

latter

dis-

can

enough.

soon

industry has therefore, over the years, developed
specialized techniques intended to
spot frauds and nip them early in
the

bud.

Basically,

of course,
continuous
eternal vigil-

these involve constant,

supervision

—

and

Finance

Company

Charges

Are

Commensurate With the Cost of

the

Services

What

are

niques?

have

some

our

found

We, in the industry, frequently

have

receivable

doing

departments

the

important
to
be
verifications, and
tions.
We verify

counts

us on a

most

assigned to

verifications—
verificaall of the acregular

schedule, some monthly, but most
often
weekly,
and
frequently
daily. Verifications are made by
mail, by phone, and sometimes in
person.
Receipts
accompanying
the invoices are carefully scrutinized
and
occasionally checked
with
the
delivery company or
railroad. Very often we ask to see
the underlying orders. Checks received from debtors are carefully
examined.
Any
skipped
bills,
overdue items, discrepancies, etc.
are

carefully noted and investi-

gated.
The

credit

customers

worthiness
our

client

the

care-

studied
to
determine
whether they are deserving of the
amount of credit being extended,

fully

The

amount

shipments to
customers

concentration

any one

customer or

watched

and

ana-

extensive

job

as we

premises and make an investigation of the books and records,
particularly those pertaining to
sales, cash received and disbursed,
the accounts receivables, and any
other

underlying

security.

The

peimii me

methods

"All-emploj'es of industry — management, tech¬
nical, supervisory and non-supervisory — should
perform a fair and complete day's work for a fair

length

outline

evolved

though

even

avoid

The

transactions

and

undue

for

firms

validity of these propositions

their

content

are

reasonable

obvious

that

seems

strange that they need to be made—but they

finance siz-

V f

tne

employ in handling
imports and exports, nor the procedures

adequate pay;'—National Association of Man¬

ufacturers.

fortunately

are

un¬

much in need of reiteration.

limited net worth.
brief, it would be fair to say

its

Survey of Commercial
Companies,
previously
referred to, the Federal Reserve
Board concluded that: "Finance
charges of the commercial finance companies and factors must
cover
the
substantial
handling
costs of providing their specialof

services

the

money

well

the

from the time of purchase
merchandise to collection

the

proceeds

livery to

due upon

Conclusion

conclusion.

have

idea

able'

been

the

role

that

hope

convey

played

I
A

some

the

commercial finance and factoring

the

loans

bank's Foreign

ment
trade,
tion in reliance* primarily upon
the financial net worth of the

income

year

1957.

yester¬
issue of $25,000,Appalachian Power Co. first

day (May 28)
000

mortgage

1988,
yield

bonds,
price

4%
of

series

due

100.874%

American

Electric

Co., Inc. (formerly Ameri¬
can
Gas & Electric Co.), will be
applied, to the extent necessary,

Ghase International
Names Four Directors

the

been

and
pay

Four

new

Directors

have

ternational Investment Corporation, the wholly-owned foreign
financing subsidiary of the Chase
Manhattan Bank, it has been announced. They are:
Edgar R. Baker, Vice-President,

Time-Life,

Inc.; Charles R. Cox,
President; Kennecott Copper
Corp.; Andre Meyer, senior partner>
Lazard Freres & Co., and
George D. Woods, Chairman of
,

__7

Bank

replaced

the

balance

for

the

will

cost

used

extensions,
additions
and
improvements to
the
company's
properties.
The
company's construction program
is expected to total $46,140,000 in
1958.
*
The

bonds

redeemable

are

the option of the company at reg¬
ular
redemption prices ranging
from

104.88% for those redeemed

j._w

the Board, The First Boston Corp.
Chase International Investment

Corporation

without pre¬
outstanding bank notes,

prepayment

mium of

elected to the Board of Chase In-

The

Chase

subsidiary in Septem-

ber 1957.

At that time it

nounced

that

was

an-

The

Association

Brokers

will

Customers

hold;

its

regular
meeting
June
10
at
Restaurant. Business of

quarterly

Whyte's

business

prior to May 1, 1959 to 100% for
those redeemed on or after May

1, 1987; and at special redemption
prices ranging from 100.88% for
those redeemed prior to May 1,
1959 to
or

100%

for those redeemed

after May 1, 1987.

the

ers

Put

and

Call

Brokers

and Dealers Association.

Rockford Sec. Dealers
Elect Officers
ROCKFORD, 111.—The Rockford
Security Dealers Association have
elected the following officers for
the 1958-1959

President:

season.

Paul

Conra&s, ConCompany; Vice-President:
King, Olson, Surprise

rads &

A1 Surprise
&

Co.;

Secretary

and

Treasurer:

James E.

Pence, Stone & Webster
Securities Corporation.
The

Association

also

voted

again sponsor the Annual FlingDing for the Security Dealers of
the State of Illinois sometime this

fall,

date

and

particulars

announced later.

field of international investments

Appalachian
Power
Company
(formerly Appalachian Electric
Power
Co.)
is a subsidiary of

rather than

American Electric Power Co., Inc.

Board of Textron Inc., announced

(formerly American Gas & Elec¬
Co.) and is a part of the

Providence, R. I., Emile A. Legros

the

C.I.I.C. would be confined to the
commercial

banking.

commenting on the election
the new Directors yesterday,
Robert H. Craft, C.I.I.C. President,
0f

tric

American

Joins Hildebrand
(Special to The Finincial Chronicle)

BEVERLY HILLS, Calif.—Har-

inte¬

Chairman

of the

that at the annual meeting held in

was

elected

director.

grated electric utility system. The
company is engaged in the gen¬

been

prominently identified with

eration, purchase, transmision and

the

investment

business

presently

tion,

electric

has joined

Hilde-

Camden

Company and prior thereto with
Daniel Reeves & Co.

energy

utilities
those

brand & Co

Power

Little,

territory in Virginia and West
Virginia, and in the supplying of

investment field,

^ Pearson

Electric

Named Director
Royal

distribution of electric energy and
its sale to the public in extensive

said this action reflects the intention of the corporation to expand
its activity in the international

granted.
Depart-

net

Power 1st Mtge. Bonds Customers Brokers to
The
First
Boston
Corp.
and
Hold Quarterly Meeting
associates offered publicly

organization,

450 North Camden
finances a firm in foreign Drive. Mr. Pearson was formerly
it grants the accommoda- with Counselors Management
a

and

$17,916,186 for the calendar

company in the lending field, and
3.95%.
The
the day will include the election
group
was
that these companies have the awarded the issue at competitive of a nominating committee.
personnel, experience and tech- sale on May 27 on a bid of
On June 2 an educational meet¬
niques necessary to take care of 100.1499%.'
ing will be held at Churchill's
The net proceeds from the sale Restaurant and the use of
most of the applicants who come
options
to bankers for loans, but whom of the new bonds and from a for
improving
operating
tech¬
capital cash contribution of $10,- niques of clients will be discussed
they cannot accommodate, for
000.000 from the company's parent by four of the leading option deal¬
one reason or another,

^.7

Financing imports and exports,
is a specialized type of finance business and requires experts who are fully conversant
with not only the intricacies of
documentation, but of shipping,
bank procedures and international
money exchange. They must have
a knowledge of the products being handled, and be conversant
with foreign credits, imports and
export
regulations,
and
many
other elements peculiar to foreign
trade.
In our company we have

When

reflect

too,

its de-

the ultimate purchaser.

$101,632,334

First Boston Group
Offers Appalachian

Power

Financing Foreign Trade

extent

and

cost

relatively high costs rather than exorbitant profits is indicated by
earnings data,
"Financial
statements
for
a
small but significant sample of
commercial
finance
companies
show
earnings,
after
taxes in
1956 of 12.2% on capital fund and
1.7% on total resources, compared
with
12.0%
and
7.7%
for all
manufacturing corporations."
financing

action

supervises

phase of the trans¬

advanced,

"The fact that charges for commercial

office

our

controls every

do,

completely separate department
handling this phase of the business,
staffed by specialists who
accounts, and those more than a have had previous training in the
certain number of days past due, field
and
make frequent trips
are
charged back to the client, abroad. The type of financial acIn addition, delinquent accounts
commodation we grant is very
are investigated to determine why
similar to that extended by the
they were not paid. At periodic Foreign
Department
of y o u r
intervals
our
auditors visit the banks except with regaid to the
At least once a month all
of the accounts are aged to determine the current status of the

lyzed.

iwt

are

Finance

experience

own
one

tech-

these

impartially and ade¬

quately enforced. ■'*

and

I .regret that this paper's
dots

picketing and all forms of coercion, in¬

and
violence are
abhorrent to
free
Americans. Federal, state and local laws in
respect
to such activities should be

client

Rendered

wonder whether those banks who

ized

ance.

"Mass

timidation

has already resold the merchan-

that

The finance

both

"Monopolistic combinations by labor unions, with
without concurrence, which tend to
deprive the
public of the benefits of effective competition
should be prohibited.

will only

our

represen¬

dise.

alyzed their costs of handling this
type of business.
'

the

die transactions where

able

losses, returns, allowances
fraud—if

Incidentally,

voluntarily chosen local
employes.

bargaining should be in good faith
parties should work sincerely to make
such
bargaining effective.
and

cuHeL,

arrangement

"Collective

■

have fi-

wheat, wools, basic chem-

ment.

loss,

—and if they do — whether they
have properly and completely an-

and

particular

finance the import or export of
merchandise obtained from reputable firms of sufficient standing
and integrity to assure quality of
the merchandise and we make
payment directly to the supplier y
to be certain that our client has
title to the merchandise. -Except
in rare cases—we will only han-

procedures and

detailed

For exanmle

icals, steel, scrap, new automobiles, tractors and farming equip- '

exe-

counts assigned, there is a reserve
of
about
20%
to
cover
credit
—

buyer

bargaining

supervision required, losses have comparatively

vances

attention of the members.

it deems

into.

the applicant and the various of¬
ficers of the finance company.

intended for only

profit-

gone

fields

Our National Associa-

tion of Commercial Finance Com-

This frequently requires consultation between the management of

various

Cach state.

can

and

carefully

ever

supplied

company

collective

involved and the

and

investigated^ Thedlfa'™8 ^ We- comply.fully 7**} whichmarket rather than in the
1 he question
to the
are readily saleable
changing requirements of open
suitable

investigated.

discontinue his
membership and

exists, the interests of the public, the employer and
the employe
may best be served when bargaining
negotiations are conducted between the employer

basic commoditiesandsuch

chandfse

participation in its activities.

comparatively limited.

pvnnrt

availability of dollars for repayment is assured, we will finance
the client even if its net worth is

the irrmort anri

li0n

Of Course!

rely

underlying

ing

general counsel employs two sariiy confine
competent house attorneys who in«

devote

con-

curity.

c<Tpany' 7 additio.n to independ-

For

28,

and

states
the

1958,

electric
municipalities
in

and

other

Mr.

the

and

Cleveland

Cleveland,
a

division

Jan.

securities

and

Midwest.

President

First

the

Director
Corpora¬

Ohio, which be¬
of

Textron

13, 1958.

came

Legros has for many years '

Inc.

in Tennessee.

months

ended

Feb.

C. M. Plowman

Opens

the company reported
TUSCALOOSA, Ala.—Claude M,
operating
revenues
of
$102,479,049 and net income of Plowman is conducting a securi¬
$18,227,654.
This compares with ties business from offices at 10
electric
operating
revenues
of Druid Court.
electric

The Comrrtercial and Financial Chronicle

(2418)

See It
We

As
lion in the third

quarter of 1955. To a iarge extent this

exceptional new car market in
demand returned to more normal

increase resulted from an

1955 and, as new car

proportions, durable goods buying dipped to $33

peak

billion in the opening quarter of last year."
Here we have a careful summary of certain facts
familiar to most students of current business trend. What
of $36

need to bear in mind at all times. And it is

expenditures for such durable goods as are here
question are not identical with actual consumption of
such goods, a fact which has far more significance than
one would at first glance suppose. When
a man buys a
new automobile he does not consume it before he gets the

page

We in Canada have heard

and

presented. Furniture lasts for years, sometimes longer

than the house into which it is taken

when bought. And

degree or another with all the goods labeled
"durable/' When a consumer lays out funds for "durables"
so

it is in

one

degree providing for future needs—
squirreling away a part of his income or other funds
at his disposal. Such outlays are not wholly different than
those going into a new home, or improvements in an
he is in substantial

i.e.

old

And

group.

of the Canadian

is growing and,

its

ago,

sixth

resented

importance
by value
fifteenth 20

measured

output, from
to tenth 10

years

rank

ago,

years

last year.

this

brief picture
industry. Canada
although there is
a
pause at the present time, the
prospects for long-term growth
So

much

for

lem is self-evident.
In

continue to be excellent and steel

income after taxes. The farther

ingot

capacity

predicted
to
This

tage

double in the next 20 years.

one

goes

This

even

the

dustry,

makes

the

Canadian

appears

whole

in¬

con¬

ciation

consumers were buying
rate not greater than about 16%

durables
of their

flect

profitable.

income after taxes.

•

of peak, but the
1956 and in the
first three quarters of 1957, so far as the purchase of
durable goods were concerned. The figure for 1956 was a
billion and three-quarters under 1955 but an annual rate
very nearly equal to that of 1955 was maintained during
the first three quarters of 1957. Consumers did not build
as many homes, in 1956 or 1957 as in 1955, but the dif¬
ference was not drastic. The practice of consumers to pro¬
vide for their future—often largely with borrowed funds
^-continued without very much abatement at least through
the first three quarters of 1957 — and, of course, is far
from negligible even at present.
An Important Factor

Whatever may be the wisdom or the wholesomeness

of all this, it obviously presents a situation which the
student of business fluctuations (or business cycles, if one

prefers) must not overlook. Evidently consumer inven¬
tories have become highly important in
assessing the busi¬
ness: outlook, and this is a field about which
very little in
the way of precise information, statistical or otherwise,
is available. It is: probably also a field in which the obtain¬
ing of satisfactory information is or would be extremely
difficult, which is unfortunate since consumers when they
are well stocked with usable
automobiles, washing ma¬
chines, houses, and all the rest can without undue hard¬
ship simply postpone further purchases or a large part of
them. It is such items as these that fluctuate
widely from
time to time, and raise questions as td what the consumer
will do in the early future. Purchases of food and
many
of the services must continue
relatively undiminished: even
though income is down somewhat and the outlook re¬
garded as uncertain. Not so with "hard" items which can
be made to do for very considerable

periods of time after

they normally would be replaced.
We hear a great deal about business inventories.
Reduction in them has been

a cause

of much of the slacken¬

em¬

phasis has been placed in recent
years on the profound effect of
inflation

the steel

industry be¬
exceptionally heavy

cause

its

investment in long life plant, and
the inadequacy of normal depre¬
ciation tax allowances to compen¬
sate for inflation.
In

spite

size of
fect

ment
To

our

the

two

inflation

has

plant invest¬

been

Mr.

use

difference

industries, the ef¬
a

common

Fairless'

one.

analogy.of

two years ago, we have both been

estimated

case

lifetime

involved

the

United

States,

Heavy machinery and equipment
such
as
coke
ovens,
iron
and
steelmaking furnaces and rolling
mills, qualify for a 20% write-off
of the reducing balance. This has
the effect of making possible the
recovery,
for
tax - purposes,
of
more

In the United States much

The year, 1955, proved to be a sort
rate of that year was nearly matched in

tax

Instead,
the
Canadian
Govern¬
ment adopted a reducing balance
system of depreciation with vary¬
ing percentages of write-off.

are

of Investment

income

not intended to re¬

properties

the

Canadian

are

particular

Protection

for

purposes

greatest pos¬
against shrinkage
inflation, and

vestment

whereby the basic rates of depre¬

sible protection

Second, that its fixed assets

line depreciation and
deliberate policy

straight

adopted

First, that its present investment

to the

collapse of 1929

depreciation allowances for tax

to
1949 we
had
straight
depreciation tax allowances
closely corresponding to those in
the United States.
But, effective
Jan.
1, 1949, the Canadian .Gov¬
ernment
abandoned
the concept

is and will be given
from

distinct advan¬
and that is the

you

arid

colossal
issue

over

line

large sum of
United States

very

replaced regularly enough to keep
the industry's efficiency high, its
products competitive and its in¬

and homes at

effective

declining
depreciation

Canada

approach as the "re¬
depreciation" method

b^ing

States

than

two-thirds of

facilities

such

studied

steel

the

industry/ its

is similar since 80%

the investment in plant in Canada
has

been

made

the

last

ten

in the last six years
dollars already much
"in¬
flated"
by usual steel industry
years—60%

—in

standards.

-s<"/';>> '•

Replacement of Assets arid the

Industry's Efficiency

purposes.

$2 billion.

over

standards.

back into history

favorable

method

currently

•

Canadian Government's treatment

that the industry will have
add some six million tons of

uncertain the record becomes, but so far as can
be determined even in the half decade of boom just prior
the

the

rates

United

protecting investment, we in

Canada enjoy one

tinuing and expanding capital in¬
vestment a very important longrange problem.
1 believe it is of
ranking importance to you.
In attracting a continuing sup¬
ply of additional capital, however,
the steel industry must assure the
investing public:

to around 17% of consumer

While

investment/ the size of ih'e prob¬

Canada,

including the funds borrowed for the purpose. Their in¬
come after taxes was $270 billion. They apparently used

come

has

steel workers the highest standard
of living of any Canadian labor

,y.

by earnings on invested
capital in excess of the first 5%
required to "stay even - witn pre¬
vious
years' investment values.
As the steel industry in the last
ten years has earned only a little
more
than
10% annually on its

increased
in

money,

together

and

try

net effect

spent more than $35 billion for durable goods and another
$15 billion or better for new homes. The two together
took more than $50 billion out of the consumers pockets,

homes. The two

the recent moderniza¬
expansion of the indus¬
made possible for the

yet

tion

Canada's Growing Steel Industry

turning to the record of those recent years to
which Mr. Winston refers we find that in 1955, consumers

running to not far from 20% of their income to
provide for their future. There does not seem to be any¬
thing in the record to match it. The record of that year
"appears, moreover, to be but a continuation of a trend that
had been in evidence for a number of years. During the
six years ended in 1955, consumers put some $177 billion
into consumer durables and more than $70 billion in new

manner

steel

companies to
grossly understate their earnings.

arid

day cost of

amounts

some

the

investment

annual ingot capacity at a present

Now

labor

not the same

Recent Record

the

enabled

means

one.

have in

allowances

key in the ignition switch—as would seem to be implied in
the way the official national income accounts are prepared

addi¬

complain that higher depreciation

balance

from

collected

through growing sec¬
ondary steel-using industries well
served at fair prices.

Continued

but substantial

taxes

Government

fact which

to be lost to sight by most of them.

appears

missing, and what is usually missing in discussions of
the behavior of consumers is a recognition of the fact that
is

current

tional

thing is certain. Any feeling of serious doubt about the
future is definitely likely to induce caution in consumers
precisely as it does ordinarily in the management of a
business. Here is a fact that the economic managers who
hope to stimulate recovery by use of dubious expedients

billion

annual rate in mid-1956 and then rose to a secondary

Thursday, May 29, 1958

unmeasured

ing in the rate of production during the past year. They,
in many instances, have been reduced because consumers
had reduced the rate at which they were increasing their
inventories or possibly even ceased to increase them at
all. When the question is asked as to why consumers began
to behave in this way, one finds various opinions. One

Continued from first page

...

five

the

cost

years.

second important regulation
that, in Canada, a full year's
depreciation allowance is granted
on acquisitions made at any time
during the year. This enables us,
for instance, to get back 20 cents
out of every dollar paid during
the • year
on
progress payments
for heavy equipment in the course
of manufacture.
This is particu¬
larly helpful to the smaller com¬
pany
with limited financial re¬
sources
in
planning its capital
budgets.

•

One

effect

favorable

depreciation allowance policy, of
is that it permits reason¬
planning of replacements.
impressive feature of
the Canadian industry's progress
has not been its expansion but its
replacement and
modernization.
Today
only 6%
of
coke
oven
capacity in Canada is over 15
years
old;
only
35%
of
blast
furnace capacity is over 15 years
old;
only
28%
of steelmaking
capacity is over 20 years old ancl
the
oldest
blooming mill is 19
years
old.
The oldest hot strip.
mill was built in 1945, and old or
.obsolete auxiliary equipment is
the exception. :1
This
thorough ; modernization
has largely been made possible by
a cash flow from profits and from
depreciation, depletion and amor¬
course,

able

The

most

tization

allowances

almost 16%

This is

years.

estimated

of sales in the last 10
more

than one-third

higher than in the United States.
In

the

last

years,,

the Cana¬

dian
industry has averaged an
arinual depreciation and amortiza¬
tion charge for tax purposes of
per
ton of ingot capacity
while, in the same period, in the
United States, this has been less
than half, with an average charge
of $4.83* per ton.
.; > ./
•
;
The point has been repeatedly

$9.93

made by authorities in the United
States that the special

"amortiza¬

tion" granted by the United States
Government
has distorted, your

depreciation picture, since it is
rapidly Tunning out, and normal
depreciation alone is woefully in¬
adequate to meet your needs. ♦
In
both our countries special
amortization granted as a result
,

of the

Korean

running just as hard as we .can
in
trying to stay in the same
place. The fact that we in Canada

are

have had to start further back in

writing

acteristic

obsolescence sets in
immediately. In support of both
of these aspects of depreciation,
it must also be recognized that
the
salvage or resale value1 of
steelmaking equipment is almost
nil: there is nothing so useless
as
a
battery of coke ovens or a
blast furnace ready for retire¬
ment Steel plant investment must
be recovered by operation alone.
There
is
the1 often
repeated
criticism that liberalizing depre¬

total

been

War has distorted

falling

the

race

and have gained a little

bit in the running,, gives us some
small license to make a few ob¬
servations

the

common

pro¬

blem.

Inflation
as

seems

with

built-in characteristic of

our

economy.
Most heavy equipment
in steelworks has a life of at least
25

there

and

years

has

been

time in the history of your coun¬

try

when

ours

been

years

valuable

has

money

earlier.

was

In
the steel industry, money
in the form of not only plant but
also working capital and invest¬
ments (unless they are

vestments)

equity in¬
deteriorating, in

real value each year. As the dol¬
lar has steadily eroded at a recent
rate of approximately 5%> a year,
many-

drawn
this;

have; been written,
prepared and* graphs

words

tabulations
to,

measure

erosion

reinvestment.
and

most

the* effect

investment
me

painful

and

the- simplest

conclusion

that the only real profits are rep¬

This

good

"free

reasons

ride."

There

behind

such

property write-offs but in Canada
the

high

write-off char¬
regulations and
of
continuing reinvestment in mod¬
has
resulted
in
a
early life is consistent with its ernization,
increasing obsolescence and rapidly growing normal depre¬
ciation
account.
In
1957
our
higher cost of repairs in its later
life. The allowance of a full year's normal depreciation taken for tax
depreciation on a project, even purposes amounted to $10.00 per
if not completed, is also sound. ton of ingot capacity and this will
Once a project is committed, the probably rise with increasing in¬
in
the
next
several
die is cast, the money required vestment
is no longer available for other years. In the United States the

depreciation

philosophy.

The

off of the major portion
the value of a facility in its

purposes and

ciation allowances robs the Gov¬
ernment

of taxes:

Such criticism

early

our

write-offs

claimed

has

in the last several
years
and
without the special
"amortization"
grant s,, normal
depreciation appears; to. have been
only about $3.50 per ton in .1957.
This is a serious matter for, the
United States industry;. 10 years
ago you were writing off $3.40 per
ton of capacity in regular depreciation and today, $3.50. On a 25- ,
year life, at the present rate, you ;
are getting, back less than. $90 per
ton of annual ingot capacity and
yet we
all figure today that
.

properly, evaluate the- capacity under $300". per annual
constantly expanding tax base af¬ ton is a real bargain. As plant
forded by an efficient and grow¬ wears out it will be exceedingly 1
does

ing

not

steel

industry

nor

the

difficult to

dip continually deeper

Volume

187

Number

5746

The Commercial and Financial Chronicle

into earnings to make up the

Continued

ference and still

(2419)

difkeep shareholders

happy. It will be
convince

steel

moneylenders

poorest and most unwise. If
reducing taxes by a few dollars

the-

that

others.

Meeting and Conquering
"E
Challenges of Oar Time

phenomenon

the

page

harder to

even

industry is competitive with

The

from first

of the: Cana--

dian

industry "pulling itself up
by its own bootstraps"' may be
good'indications that we may be
heresy to accounting purists, but
on
our
way at the present time.
the modernization which has
re--

suited has been

the

But

question/remains

dangerous

prime reason for
how
long
and how
sound
the
efficiency and" better
journey \yill be.
margins for the Canadian*
Many... short-range government
steel producers, since steel prices
a

improved

profit
in

Canada

have

risem

the

slowly

North America

last

years*

than

whole:-*

::.-

'To
tion

that realistic

say

deprecia¬

allowances and improved ef¬

ficiency
are

modernization
to keep bur indus¬

through,

necessary

try's products competitive in
markets

mon

but

may

Canada

a
particularly
with respect to
competition. Our market

can

much

of these

being ap¬
plied, in,.: the hope that they will
be of. early help toward stabiliz¬
ing-. the. economy and giving it
are

momentum.

new

But

even

question:
behind

What

these

of «v long

are

the

putting

measures

terms

stability

range

vital

and

steel

coasts

steel,
at

customers

our

have

users

foreign

available;

surfeit

think

they

their

business

had

available

$175

ton

our

month

one

and $125 a ton a few months later.

can't

petition

control

overseas

from

and

will

can

it to improve

use

and

make

Money for capital outlays

borrowed, in

large

part,

when / the
long-term conditions
cost' for investment are sound.

com¬

labor

profit.

They borrow it if they

standpoint, can't hope to meet it.
Modernization

Long-Range Tax Probelm

one

emphasize,

and

It is

steel industry shareholders have a

public

right to

policies, for

factor

must

small

seems

it.

expect

have said

that

license

have

had

some

.comment.", on

depreciation, practices
our experience.

ment

because

healthy to be having
discussion

real

Federal

tax

change. But why
confine this simply to the prob¬
a

lems of the moment?
is such

our

it certainly is—why
there not.be equal con¬

should

and

forward

fidence

■„

„

affairs.

regret to
old regula¬

the

consequence

with

steel

with

back

abandonment
tions

far

greater

look
con¬

money into the economy may be
important in giving us a lift. But
if
these' projects
are
not. selfliquidating, .what of the ultimate
effect?
The lift will be of no

value

constructive

years

■—

Animal Golf

its

Five

Tourney

and

Twenty Club

will hold. its. Twelfth Annual Golf

Tournament, and dinner

is to whip the reces¬
back on our eco¬

job

and

get

nomic feet. It is

American Stock Exchange

members*

Our

sion

ASE 5 & 20 Club
i The

ifr

wake, we are
V.;/-v ' drained of strength by a cheaper
and
cheaper dollar.

the

ahead.:

Thurs¬

day," June 5, 1958, at the Sunning-

ernment

alone,

job not for gov¬
business alone

for

—but

business, government
American. We may do
it with short-range actions,.-but
they had better have long-range
goals. And in such case, the main
task of the government is to help

and every

Club,
Scarsdale,
N. Y., according to an announce¬
ment by club President Leonard
C. Greene.
•'

private enterprise do the job that
only private enterprise can do —

Harold T. Brown, club champion,
will
defend, the
golf
title: he

dale

Country

captured

one

...

year

hundred -exchange

Several
members-and
ago.

guests will participate in the day¬

that

capital, private
and services. It
as some politicians urge
end, to ride off in all

is,
create
jobs, and goods

not,

without

directions
fare

to build

bigger wel¬

state.

■

Government

may

prime

the

but it's private enterprise
that keeps the well full.
*
.

This

Joins Cruttenden, Podesta
(Special to The Financial Chronicle*

DENVER, Colo.—James E. Roth
has joined the staff of Cruttenden,
Podesta & Co., 524 17th Street.

Garrett-Bromfield Adds

behind them.

(Special to The Financial Chronicle)

added

the

staff

Garrett-Bromfield &

Street,

members

Co., 650 17th
of the Midwest

Stock Exchange.

With Ideal Securities
Colo. —Abraham

DENVER,
Berenbeim

with

has

become

affiliated

Securities

Ideal

National Bank

Co.,
Building.

that,

taxation,
factors

with realism,
rising tides of
inflation, business was supposed
to go along unperturbed, creating
a bigger and better prosperity.

regardless

step

of the

Surely, the real fact can be seen
more
clearly today than
ever.
Prosperity is not assured by fate.
It can only be assured by the wis¬
dom

with

meet

which

America

problems and seek the

our

Colo.

Hunley

has

been

Mountain

—

added

the

staff

rities

Corpvi. Denver Club Build¬

ing. "

States

Secu¬

be comprehensive. These are
plex times, to say the least.

whatever

be,

re¬

the

total

But

program

steps will be vital to

it.

may

basic

certain

that

suggest

com¬

The

include:

would
The

adoption

realistic

policies, to encourage capital

tax
ex¬

Increased

productivity, to help
stop inflation;
The

encouragement
of
longprivate foreign investment;
The correction of abuses by the

event, if individual in- And a continuing disparity will
going td be largely si- mean continuing — and mchre
phoned off by steep progressive severe—inflation,
taxation, it can no longer be
If all Americans, whatever their
counted

upon

capital.

Nor

major

can we

source

expect in-

dividual investment to be greatly

encouraged

look for the nation.

This industry,

So the final resort is to borrow-

ing, but

know that excessive

to borrowing can be of
danger, both to the bor-

recourse

serious

and t0

whole
In

to the fu-

answers

ture lie not only in what happens
sales, but in what happens to
ih
t -C
4-ur.i
S*
the onlno dollar.
sales
If thaf part of
the dollar that

adequate,

tax laws will have to be

over-

are

of
often the

certainly aware

They will have to be
than

the

patchwork
which

present

real-

unplanned
most

measures

hastlly adopted to flnance
wars, and seldom, if ever,
revoked. They will need to recogwere

nize that

«-.«
an

ia
is

reasonable

profit, after
it.;
thing,

honorable

and

better

jobs.

They will
stifle, the

corrupt segment of labor

last year,

that

this

encourage, not

private

American

S±?L™!io?fC0me more and

°
important,
Such pnvate capital can. help
^ve the burden, on the
American taxpayer without un¬
paiF1*1£ our program of foreign
a.ssistance and mutual cooperation.

Investment

private

capital

?^WR

STTf development while it
-

P°®slb^e than political

pLfntiS, isolation. Many of the
SLJS

With respect to

the long-range

Dynamic

Program

Tax

Required

economies.

many

these

is required is a dynamic countries, the percentage of prolet me begin with a
short-range observation. On tax program that keeps Federal $uct!on gam +o£ tbe paft+decade
revenues up, not by
taxing away
every side, we are hearing that
je2fS!f5'
all our economy needs is a pick¬ the incentive and means of new
but by steadily in- to ,bf /
J- wv? *51
up in sales. If everybody will buy enterprise,
the tax base through
more, the sales volumes will go creasing
Villainps<s PvnnnQinn
Stflltfiu. Silt. It, IS- Sl^illflCSnt, 311(1
up,
and our problems will be
If our economy is to be sound,
solved. Well, of course, sales vol¬
What

tax program,

HSrhf

umes

goes

fundamentally

are

tant.

sales

up,

impor¬

production

and unemployment goes
least for a time. But
fact is that sales are not the
up,

down,

this
of

is a fact the great majority
Americans must come to un-,

derstand.
a

The

public

the

lot about

whole

hut ^develop our own.
llg™*,

hearing

tering that illusion.
Our

population

rapidly.

In years

is expanding
ahead, we shall

need millions of new

jobs to keep

with this expansion.
And
the corporations of America will
be
expected to create most of
these jobs.
Corporations, today,
provide nearly three-quarters of
all
the
non-government
wages
Of
into

course,

billions
in

new

only

being

jobs can come
dollars —

when

invested
capacity for

dollars—are

America

every1 citizen^In thTy^Lead
the

release

genius

will lie in the
ou7 productive

to that goal

wav

fun

not

and

shuffling

the

in the static
people's

re-

income

?s^i

long-range need

A second

tools and new

ston inflation

The recession not-

withstanding,'

number

Well, we know it must come
profits, or borrowing, or
individuals willing to risk

one

their

money

of these wavs.
Federal taxes alone

can

take

than half of a com¬
pany's net income. Combined with
rising costs, such taxation can
only
continue to shrink profit
away

sound basis.
We hear it said

I ventured to point out
nation was tending to

oppose

that individual
a

cut in their

they would save
few dollars." Of the ar¬

because
a

guments

that

against such a

might be raised
cut, this, I think, is

TtoW valu^to'our Ico^
A tht ^tnnin^ of?he

prob-

tne free worid'

potential

with which

we are

Labor

industry, we are helping
to fight inflation by doing all we
can to
increase our productivity.
an

steel

huge scale—as has their instal¬

lation

the mills

American

has

made

recent

and

industry

tremendous

plants.
in general
strides

More will be re¬
keep pace with the
needs of our expanding society.
Industry must continue improving
its productivity at least at the go¬
ing rate of 3% per year. It is de¬
sirable, of course, and fully pos¬
sible that industry will do even
quired

years.

better.

Unfortunately,
ductivity is only

cor¬

ruption in labor leadership, where
it
exists, must be rooted
out.
This is no side issue in the long-

tional

heart

the

well-being.

our

What

It
na¬

will

in¬
in the

the American people to

avail
vest

America,

for

outlook

range

strikes

their toil and savings

future if this future is to be ham¬

strung by a clique of labor czars

powerful

they

cannot

touched?
Let
not

make it clear that I am

talking here about legal union

policies and actions. Emphatically,
the
problem
of
racketeering
leadership does not exist in the
steelworkers' union.
But this is
no
reason
for us or the steelworkers' union to overlook it.
For the clear fact is that all
union

however, pro¬
side of the

one

Abuses

My fourth point was that

Increasing Productivity
As

concerned.

any

and
that end, American
business and government need to
look for ways to enabIe priVate
American capital to join, more
easily with private" capital in
§row< And to

nomic problem

Its

However, we also know

°"?y ***

The

buying

Some i:ndus-

,.5 "L

for ultimate
harm overshadows any other eco-

lem.

from?

from

our

*0^^"improve
excellent reason to

it is inflation that

production. Where will that money

from

* he *eneraliz<^

remains

paid.

and salaries

building

are

to stimulate

need

answer,

oTlhe^ree^world0^?^"we
efforts

?£

consumption. More vital is the
need for public support of a tax
by any manner of
means.
And it is time for all of system that will stimulate investus who
know better to quit fos¬ ment as well as consumption.

the

"onlv

industry

ca°Peratiout will

•

Sjf11?® increasingly essential).. In
^
^ climate, the foreign in-

s<lnsi^lf

in our meeting

regard the growth of its

W worldwJlich inte™ational

„T

abroad by providing the initiative
and skill they want to acquire.
re¬
leader¬
Isolation by American business
ship, and sound laws to insure ductions .resulting in government in
this shrinking world is no more
union
democracy and financial deficits and inflation. It is for a
tax system based on the greatest
responsibility; and,
Better public understanding of possible government efficiency—
the facts which affect industrial a system which holds so closely
nt
th! ins
®
expansion,
employment
and to the level of genuine need that
it provides no inspiration for ex- ™a
standards of living.
moving forward actively in
trnvawndP
o
are moving
s
the 1 development
of their own
Stresses Sales-Dollar

taxes

For that reason,

E°n?~r ange Ane€<*>
the key Place ofIt is a
Alber¬
a

especially when it's applied to
the
long-term task of creating

nation's productive initiative.
The call here is not for tax

taxpayers

public is not.

?«
JiiL/i1
woricl

vestment

hauled

istic

Foreign Investment
™

is left for invest-

ment in growth is to be
our

profits^ and productivity
gu*r.* Up together in* step,. We
never be safe from recession or worse untl1 this, is done.
W£^es.

economy as a

short, the

need to

other, depends upon
strength of the American •margins that are already inade¬
and our people.
And quate to finance capital needs on

every

occupation, are to realize the
promise of the future, there must
be honest, volutary recognition* of
these facts by all concerned; We

as long as the double
taxing of corporate income is must work to achieve a, balanced
kept in force.
*
overall movement forward—with

term

come

reduced, 1*

all

pansion;

this, it anoears that too

healthy

can't limit our
thoughts to the problems of our
own
industry.
The outlook for
steel is inseparable from the out¬

while

its

for

program

our

can

ity advance. In the last 1Q years,
a 26% gain to industrial prQductivity has been more than* absorbed by a 61% rise in wage
rates.
The
difference
between
those figures represents inflation.

and progress will have to

Its value

any

come

industry has invested
stock.
that the heavily in better productivity and
has shown remarkable results.
candor and vigor.
In fact, you tax codes today are making it in¬
Research in new machines
and
difficult to
finance
were
doing so long before the creasingly
new methods has gone forward on
new tools
and capacities soundly
present alarm was sounded.

economy

Charles

insure

Business, to a far greater de¬
than before, has been meet¬
ing this obligation. Many in our
own
industry,
have
expressed
views and recommendations with

Mt. States Adds
DENVER,

Plainly,
covery

consequence

Presents Fivefold Blueprint

ob¬

gree

the basic

(Special to The Financial Chronicle)

Obviously,

(Special to The Financial Chronicle)

Business has

help devise and sup¬
port the best possible programs
to revitalize the economy, and be¬
ligation

progress.

DENVER, Colo.—Carl W. Ohlin
been

being true, business has a

responsibility to speak out, to ex¬
press its views and stand firmly

yond

has

out

many

a
handy
Regardless of

of'wage-push

was

of reckless

And it is out of such
passive acceptance that towering tax
rates are gradually built.

pace

pump,

long affair.

all

If taxation

elemental force in

economy—as

;■*

Canadian

look

■,,

regardless

years of ex¬
cern
with the whole long-range
perience
with depreciation
tax.
problem of* where our tax philos¬
regulations more favorable than
ophy: is heading and what the
your
own.. The
experience -has
been enlightening and has been consequences may be?
Quick projects to pour Federal
the means of a very real improve¬

burdens

either.

Among

among

assumption to hold.
the

would

steelmakers and

that

opportunities of the future.

easily by the strength? V~

smothered

leaders, and
Washington, it

was

nothing to the taxthen it might be assumed
raising taxes by a few dollars

coin.

not canceled, by increases towage
levels that outrun the productiv-

payer,

assumption.

labor

larger producer " nations'
Businessmen1, we know, don't
surpluses, and both we asT borrow money just because it is

steel

Some few

com¬

sensitive position
overseas

cluding : yaried kinds of tax cuts,
easing of credit, and public works.

obvious,

seem

have been proposed, in¬

measures

automatic—and that this

means

la**™*

affected

Continued

the

page

The Commercial and Financial Chronicle

(2420;

Continued,

jrom

the

page

renewed ' progress

will

not

and that

long-range goals

Meeting and Conquering
Challenges ol Our Time
ctigma of this abuse and the ends
it

which

will

lead

it is

al¬

lowed to flourish in labor's ranks.

What

do—and

can

doing

moral strength is obvi¬
Public pride can hardly be

—to

our

ous.

raised

by the spectacle of a gov¬
ernment unable or unwilling to

corruption

with

cope

sible

ethical

and

lacking in either field,
let
correction
be
applied. The
laws regulating corporate finance
already are comprehensive. But

directly at insuring full respon¬
sibility in union financial affairs.

our

Such laws will

the

demand for them

progress
in
serious
Obviously," men
without
principle can hobble major indus¬

kill

and

new

with

ones

They have, in
their
control of manpower, the
means
of
crippling the entire
economy at any time they choose.
They foster fear, cynicism and
huge financial loss among union
themselves.

members

And,

not

least, they give strong fuel to
communist

the

dence

Many

field of corporate

pansion, employment and stand¬
living. This point actually
applies to all the others, as X

think I
on

The

have

indicated

touch¬

general well-being of our

is everybody's business.
It is not planned or dictaced oy
It is reached by various

anyone.

methods,

not

three.

one

any

two

the

was

setting up of the SEC. This
not face-saving legislation of
the kind some of the gentlemen
Capitol Hill

revise

their

for
It

now.

scampering to

are

labor

thorough

was

effective—and

patrons
—

done

was

about

combined
the

past,

start appeared to
the

hearings

be
the

enjoyed

have

than

folly, and we

hope that this good balance

standing

with

free

by the
folly of

and

wisdom

of labor.
proper

"All

managed

are

wisdom

the

may

said:

people."

crusading, moral spirit that seems
to be suddenly missing when the
wrongdoing is found in the field

made

has

someone

governments

was

will prevail.
need

If it is to do so, we

look

lems by

better

under¬

economic

our

prob¬

the great majority of the

American

people.
Better under¬
is the medium through

Committee. The Com¬ standing
mittee, in the light of its findings, which all other objectives must
recommended
legislation to do be gained in a democracy where
these things:
public opinion is the final arbiter.
Much will be accomplished, for
To regulate and control pension,
McClellan

health
To

and

control union

and

funds;
insure

union

democracy;

To curb activities of middlemen

parties

themselves

quarrel.

any

reasonable

and

recommendations, with
one
except the guilty

necessary

which

should

find

But let anyone

say

and we immediately hear the

so,

atock

old

cry

of "anti-labor."

comes, of course, from the labor
of whom we would expect

czars

it—and in

Congress, the political

heat is turned

on.

Many members
of
Congress,
along with the public, profess to
be greatly shocked by the condi¬
tions the Committee has brought
to

light.

that

There is

legislation

evidence

some

covering health
be passed.

and welfare funds
may

This,

if done, will be a step in
the right direction. But it will be
only

of what is necessary

part

if the

problem is to be

estly and effectively.
The question now
that

large

bloc

opposed to
be

able

hon¬

which is

the root

which

all

of the

wage

progress

de¬

earners

the

persuade

whether

Congress

majority
drag their legislative feet, un¬

der

one pretext or
another, until
the public pressure for the neces-

steps presumably
died down.
-:nry

But
other

believe

case

this

will

have

an¬

where the public inter¬

will refuse to be hoodwinked

est

by political evasion.
the

American

nally

aroused

been

people,
to

unwilling

the past,
when fi¬

danger, have

allow

any
excessive

group

power.

They have acted, in time,

accumulate

curb such

of it

The

holds

same

economic

facts

ductivity,

true

prices,

all

and

the

the factors

standards

the

affect

that

pro¬

employment,
that

basic

are

of living

of the

American people.

Here,
is

power when abuses
have become widespread.

Our economy, to meet the test
of the future, must have
respon¬

end

ability of our nation's in¬
dustry, government, and people to
meet
on

the long pull ahead,

over

primary

industry,

task

well

for

steel

the

others

who

possible

communities
that better

employees,

and

home
public, so

the

understanding

can

fostered to the benefit of all.
One
we

thing is certain: As of

have

doubt

the

basic

now,

whatsoever

reason

and

strength

vitality of the economy itself. By
and large, business has proved its
mettle

this current

period by

soundly to adjust to its
problems and to keep in position

for

renewed

American
to

progress

business

reduce

costs,

has

e a

continued
proc¬

research, and de¬

esses, encourage

velop new markets. There is no
question
of
the
determination
throughout the ranks of business

enlarge

conquer the challenges
time will be the vital force

of the world of free

This, I believe, is
expression

let's than

of all, let's quickly trace
development of our foreign

trade

policy through the years, i
this

think

will

perspective

and

give

better

present prob-

our

also

may

encourage

understanding

generous

imports
tons.

Second,

about

of the world.

early, agricultural stage
of our economy, we were heavily
dependent on imports to supply

material needs. Tariffs

our

imposed largely

were

means

our

industrial

own

capacity began to grow,
eign trade policy took on

our

for-

strongIt was in the

ly protective aspect.
national

interest

struggling

to
give these
industries substan¬

new

boundaries

hear

for

And

chrome,

be-

are

gained strength through the 1920's,
the

put

enactment

Agreements

the

Trade

in 1934 swung
the other way, and

Act

the pendulum

import duties

able

ready
To

exist

the

natural

re-

this

access,

must

re^ain tiie full respect and co°Peration of °br free world part¬
^5.rs' a
this

trade

think we

erecting

barriers.

most of

our

can do

unreasonable

Justifiably

allies look to

days about the
fidence.

let's

based

around

tales.

need to

Now, I

—but

have

the

agree

truth.

telling

toward
with

con¬

with

that

confidence

Let's

not

fairy
Let's not try to draw out
truth

benefits

many

and

also

problems.
But, until now,
problems have been largely

some

the

covered

the

tremendous

of domestic business activity

following World War II. Unfortunately, this is no longer true.
As you well know, the import situation is growing more painful
every day, and we are again faced
with the choice

continuing

the path toward free trade or re-

verting to
policies

our

former protectionist

Our decision

vital

Its

one.

effects will be felt far beyond the
limits of the steel industry.
To-

day, the direction of our foreign
trade policy involves not only our
economic and military security, but that of our allies as well.
In making our decision, we must
own

remember

that

our

are

free

world

and

actions

our

must be governed

accordingly.
Therefore, it is imperative that

consider

quences

face.

carefully the conseopposing choices

the

To stimulate

look

our

think-

some

them.

have ,an adverse effect

pro-

raw maferials more dif-

that

wishing well.
we

have

hard problems to overcome—that

P°l\cy would weaken our fight
agail}s^ T?S?luni?J encroachment,
Russias KKK
that is, Khrushchev an<J his Kremlin Kronies—
are r<r?yj Wllllllf and ab.lcY
sever the free world ties of mterdependence by attacking on a
third xront—-the commercial front,
*ac1' the challenge has alfeady been hurled by Khrushchev
himself. To an American news-

vve

the

are

return

the

consequences

he recently stated, "We
jWaJ ?n /ou J,?
peacef threat to
the United States is not the ICBM
hut in the field oi peaceful pro-

PaPer man

tionism

and trade restrictions?
First, from the purely commer-

risk the

Auction. We declare a war we
w * ™irf- over the United States.

steel

foreign

idle threat! We alt
the rapid increase in

Russia's military capacity, but her
expanded industrial potential to

customers

( ;:

argument

also

can

In the

case

certain

materials, free trade
policies can lead to a dangerous
depletion of our vital resources.
Ferrous scrap is an
excellent
example. I am sure you are fa¬

miliar with, the details of this

re¬

curring

not ;

dwell

that

problem,

the

will

Suffice it to say

it here.

Commerce

Department's

latest investigations in this critical

showed that there

area

ample

were

the most serious

think

conse¬

of unrestricted trade is in

quence

tion.

severe

Generally speaking, foreign
rates are much lower than

wage
our

certain of our
by exposing
import competi¬

industries

domestic
them

where

and,

own

the

this

not

superior productiv¬

our

domestic

industry

con¬

cerned cannot hope to compete on

equal

with

terms

the

overseas

producer.
Unless

some

given

these

sort

protection
industries, severe
result
in
key
areas of our economy.
This is a
particularly critical consideration
when the industry involved is es¬
is

dislocations

sential to

will

national defense.

our

The

import problem is causing
sleepless nights right now. As
you know, some of the companies
represented here today—including

Sheffield

the

Division of my own

locked in a fierce
cut-price imports in

company—are

with

battle
the

Gulf

Coast

situation

This

area.

exists

other

same

parts of

the country.

During a period of full opera¬
tions, it is easy to concentrate on
products that are not affected by
lower priced
import items. But
today, when our operations are at
such a low level, it is difficult—
in fact, impossible—for our people
not to be concerned when they
the price of foreign

see

from

$25 to $35

price less than

to $35 under our

These

are

painful

steel swing

ton above our

to $25
price today.
year ago,

some

the

liberal trade

are

hitting home
way out, of

effects of

policy and they
now.
The

right

easy

would be to demand Gov¬
protection—to cry, "Keep
out!
Buy Ameri¬

course,

ernment
the

foreigners

can!" That would be the easy way
—but would

Putting
the

it be the right way?

self

moment

sides

aside

for

looking at both
issue
fairly 'and

the

interest

and

say that
in the best

squarely, I can't honestly
this attitude would be

back up this commercial challenge
interests of
our
country or our
is perhaps less well known. Over
industry.
Neither can -1 recom¬
the last five years, Russia's steel
mend following blindly down the
output increased IV2 times more
rapidly than

ours,

while her rate

of increase in total industrial
was

about

fact,

nearly

times

during
15

pro-

the

Russia

million

our

first
pro-

tons

than

half

the

capacity

the

United States!
She
to

woo

our

to retain these needed

trade.

you

The dangers
equally grave.

what

understand

can

when I say

that I

astrad¬

dle the fence!
But

friends,

this

than

many

lems

friends

through strong trade inducements
—especially in the Far East. Tf we
are

free

mean

are

aggressively attempting
many

path

in that direction are

ingots, compared to our 19 million
tons, and she did this with less

pos-

steel market,
Last year exports represented our
fifth largest market and we sold

•

duced

path of protec-

cial standpoint, vve
sible loss of a big

other

exhaustible

our

resources

turned the other way.

quarter of this year,

Policy

protects

this

But

deeply involved with the steel industry
free
f?'
third, a restrictive trade

own.

What

the

the consequences

are

permitting
imports to be used in their place.

ity,

American sentiment throughout
world and make our future

duction

Trade

im-

toward protectionism is likely to

This is
longer know of

infant nation but the leader of

these

talk

What

decide.to continue along the

offset

attitude

our

ourselves

confidence out of
The

deal

•

Consequences of Free Trade Policy

not,

anc* soipe iron oro- Thus, in this
foreign trade has brought area °! raw rnaf^rmls, we are
in

path of restrictive

trade.

the damage done to

of other countries.

insure

evolution

some

choose the

without

grow

access

declined

have

of the major
will have to face if

are

world neighbors for zinc, man- grounds to justify our fears—par¬
ganese, and iron ore.
At some ticularly in regard to heavy melt¬
time in the future, we will not be ing scrap.

tariff
protection against
powerful competition from the P°rf P°|icies as the symbol of our
old, established industries of
interest m the growth and
development of the non-CommuEurope.
This high tariff movement
world. Therefore, any move
tial

Consequences of Restrictive
great

These

problems

our

sources,

raising revenue.
Later,

mill ion

coming increasingly dependent

the

most of

four

complicating
our raw material problems.
It is
common knowledge that we depend upon sources outside our national

new

It is also

risk

nickel, and tin.

of the relatively

areas

coun¬

try makes, but who can cut the
price without considering his cost.

that

important to note that our exports
of steel mill products exceeded

day in

industrial

only

product his

every

natural

the trade barriers which exist tosome

not

One of the advantages claimed
by the advocates of free trade is

did to the appliance, agricultural, shipbuilding, and mili¬

are,

First

the

kind of

new

who

man

path of trade liberalization?

Foreign Trade History

demonstration.
We

sell

this

Now,- what; " about

Impact of Expoifts-Impoits

ing, let's take

than

confidence—it

account

can

men.

tary markets combined.

these efforts.

upon

full

and

our

page

trade than you
with the subject.

the

improve

must be ready to meet Russia's
challenge. We must be sure that
our
foreign trade policy takes

from

The

surge

support our enterprise system. It
is to present the facts as clearly

may

Continued

This

to pay.

moving

labor reform will

any

met

concern

our

pend.
labor-management disputes;
To clarify the "no man's land"
Every voter needs to under¬
in labor-management relations.
stand that every additional Fed¬
eral expenditure
means
an
in¬
Now, in view of the gravity of
what the Committee has learned, crease in the tax he himself has
seem

growth

traditional

steadily since then. Today we are
arv
not a high tariff nation. A report
This raw material problem is
several years ago showed that, of no? one-sided. As we draw sup43 countries reporting to various P*ies from abroad, other countries
international agencies, 35 had a are
simultaneously dependent
higher ratio of customs duties to uP°n us for certain materials. For
total import value than the United oxampie.
Western Europe, EngStates, and only seven countries'^11!?' an<* JaPan are depending on
had lower ratios.
us *or lal"8e amounts of coal, scrap,

when the majority of
recognize that exces¬
taxation destroys incentive,

these

continuing

the

taxpayers
sive

been

example,

welfare funds;

regulate

the

Thursday, May 29, 1958

route?

lem,

them.

is, in short, brought
the combined opinions
and efforts of millions of people.

legisla¬

One of many examples was

effort

salesman—a

America's

For the

This

objective and the safeguard of all
others.
It is, in itself, an over¬
powering reason why we must
keep our economy strong, permit

ex¬

country

corrective

adopted

erly
tion.

racy.

munism.

get

Economics

ards of

there

organization and

democ¬

the steel industry.
It is more
important than ever that today
we pledge ourselves to this anew:

the

make

the facts that affect industrial

ing

finance, the Congress quite prop¬

that

way

My fifth point was that we need
better
public
understanding
of

deca¬

revelations of abuses in the

were

greatness

ing and expanding the free world
against
the
onslaught of com¬

insistent they

Public Education

life.

ago,

the

proved

has

foreign

when

American

build

may
can

cannot be denied.

claims

years

people

im¬

possible demands.

the

American

to pass when

come

ways.

that

the laws aimed

are

economic

tries

leadership

foolishness

it, and do all
it soundly in a

—is the vast objective of defend¬

key

places of national power.
But
it can also handicap

eyes on

begin tak¬

and

weaken

Of all of them, the greatest one
—the one that enfolds all others

Where it is

indeed

our

—

ing the steps to reach those goals.

throughout labor, just as we must
have it in business management.

scarce

must set

seek

automatically

occur

face almost

daily? There

usually serious disadvantages

either extreme of any problem

that
settle
I

situation any worse

of the business prob¬

confronts
on

think

us,

compromise

usually
solution.

that^a middle-ground ap- v

Volume

187

Number

5746

The Commercial and

Financial Chronicle

(2421)

proach is the light

answer

participating in a history-making
event that is taking place in this

our

foreign trade problem too.
a

Tvr*#iai

I am not
going to attempt to
spell out what I think this approach should be. That is a matter
for very
all of us

careful consideration by

Foreign

Relations

this

perhaps through the
Committee

Institute.

However, I would
like to offer a few personal opinions that may be helpful in developing a middle-ground approach.
First, I believe we should strive
toward trade

liberalization

long-range goal, but
cautious

fact

about

that

it.

The

our

must be

cold, hard

will not be able to

compete on a free trade basis unless we narrow the wide gap be-—

tween

our

labor

own

„

Ford

for

have it in manage-

Foundation,

My third observation
die-ground

approach

mid-

1hat

can

increase

ductivity.

human

our

Management must

larly
cost

step

i5.

between

cut

administrative
ctuxxuixxsixaixvc

eui

unit

our

unit sxep

our

output

U11V1

VXX

U K/i V/U VI

V/ U1V.I

VV JLpUj

> ——

v v» Q

pei

V Wf AJ A vx

to
10

man-hour

avMJ.

Aj AAJMA V, » V

our /,°.reign competitors, we may find ourselves in the same ments. And Government must
now'
as
" ,l.s®!y critical situation that is now facing take positive action to increase

??ex?

i<^n.

offset by our superior productivity
and by the fact that demand here
and abroad has exceeded productive capacity.
However, we are

friends

our

the

h"dUstry 'Because

machine

its efficiency

tnnl

of the growing

hreafromforcio

comnettt

think

von

rose

talking

™

the

basic

here—particu-

weakness

our

"uL dnac?ZJ,u glvc yo,u a
saesrevO
U?°pla' ^ mef

Marketing Study
J.

Walter

Canadian market in

fourth of

Canada has the fastest
economv

amone

all

costs

losing some of
raw
material

beyond our

own

for these materials

lores

Lets face

it.

their

foreign

production

back xicic.
udciv here

our

labor

better balance be-

and

own

forejgn

«ac4c

pr0_

tion

pretty much in generalities but, in
L nvnfvon are from Missouri
case any of you arpfrnm Missouri
specific

3facts

coinparative

about

final

the

labor

analysis,

Therefore, a comparison of labor
costs will give us a good yardstick
to

measure

the difference between

conversion

total

abroad.

here

costs

tariff su^e.ct

trade,
think

but

Y3S

only

fair

break.

Baruch

expressed

wen when he said,
«Let the United States say to all
veiy

worid

hereafter

that

will

conduct absolutely free trade with
taking the total any COUntry in the world that
man-hours
required to make a meets our wage and social standton of steel and multiplying by ards.»
Actually, I think we would
lihnr
lnhnr

pn<?t
nn«?t.

hour
hour, including

ner

his

111

!11S thro.ugYa loint

= m

•

increased by 15%

sliding

periodic adjust-

Bernard

case

our

ana

toe fringe charges

wages

•

income. This might mean a

labor charges by

+Tia
tbA

direc-

vital factor not only in our own
survival, but in the survival of
democracy throughout the free

world.
—

„

series

major world

mar¬

nntirmc

leading the world m
rate of growth in many fields.
1S

al'e

,.T,

its

workable

keting
,

The Canadian Markets,

of a mar-*
at focusing

aimed

area,
-

concei
concept

J; J'clativeiy small

the first number of unpoitant places that

tull"scale marketing study of the account for the bulk of Canada's
Canadian economy. The 178-page economic activity, is presented on
book was developed by the J. a large colored map pin-pointing;

extremely

market classcs and theif

locations.
n

To ei?able the reader to make

rich and well-developed market comparisons 011 a. national orprobased on a high level of purchas- ™cial. scale quickly and simply,

there is a systematical arrange.i~4~
....j—
-.0
"Due to such'factors ^1?i,?Ldata. un.der...12 Paik?*
topography, location indicators, each significant as to
topography, location the nature, size, stage of deresources, the

big power," the Thompson Com-

pany says
as

as
and

climate,
natural

traits

eeonn-

are common to all." Included

.lecis as standard of living,

energy

^em£oyee~™a™ag?ment attack on am0ng the volume's many high- and power, climate and capital
countries which improve the livfaSu? a"d inefficiency at all levels lights all pointing to new, grow- expenditures, mineral and vege5ing and untapped markets'are ing. population and characteristics^
these*
'
through
broader distribution of
Yu

these

determine

can

wage.s than others
tnan °theis

production costs here SS to a comparative level in the free
and abi-oad.
It is generally agreed that about w0rld market
80% of the cost of producing any
tog must be made quite
manufactured pioduqt is labor
ciear—we are not asking for any
even the taxes we pay are mostly
fav0rs in the field of international
for

this

111

^AUhouch^he'"^^ m'nch

wher

abroad, but here at home too—if tariff"structurethat would"in efwe should have to compete on a
fect recognize and reward those
free trade basis.

strides

" Achieving
twcen

inflated

our

paid

growing locomotives, chemicals and phar-

mainr

One relatively small manufacturer I know of has already made
tremendous

are

^nd

j.on§ a11 ma-l01 natlo^s maceutical products,

top of this, we
advantage

our

together

Canada Now Available

nnof

Study shows Canada leads the world in growth rate,
particularly in consumption level and domestic investment.

"Canada provides
\

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and efficiency
r\

this

Thompson Company issues fact-packed study of.4

betwee,flabo^nd^nLTge!uentf!n published by JMcGrnw-Hill. y" ^
OTblfsLdtv^Graw^m
nmhinwa

What

correct

put ourselves back on a sound
competitive basis with all other
countries, will undoubtedly be a

—

rapidly losing these advantages, markets, many of these
companies
Foreign enpneity hss grown tie- ^re bcinfif forced to transfer panapmendously, and they are catching jty abroad, and the
day may
up with us
in productivity.
On c0me when thev will have to ship

mnrndphino1

meaning.
to

man noui and

costsa.ndth.ose ab™ad-.0,!lerwlse' ^ough technolwcal

VV/U KM

and
ana

costs
cusus
ner

discussed

-—

use

qble

over the points

production, and the dangers of going too far either .way
in our foreign trade policy—I now
believe it has a very significant

all the'resources at its disposal to

l>etween

are partly a
cover-up
inflated labor costs.

have

pro-

must have adequate tariff protec110x1
tion until we gain a more reasonuiuii
gain
balance

our

As I think back

and at ment, and we have it in our workthe request of the State Depart- ing forces. It is one of the most
ment, 200 engineers from India glaring faults in our American
are
already being given a year's Way of Life, and we are going to
training in the steel plants of this have to eliminate it if we are gocountry. These men will carry ing to stay ahead of, or even keep
back with them not only the steel- up with, really progressive commaking
knowledge
they
have petition from abroad,
gained, but also first hand experiThis means that labor, which
ence with the American Way of aiSo has a
big stake in the successLife—our habits, our customs and, ful
outcome, must take a more
most importantly, the benefits of realistic attitude in
its wage deour free enterprise system.
/
mands, and must do everything it

and

the

that tariffs

have this featherbedding in Gov-

country today. Under the auspices ernment,

""ofl'c-urouna Approach

—

for work not done at all!

pay

national

while

this

against

year,

averaee

about

apProach might not work for all of
it certainly is'indicative of the

f! y 1S "1QJCd"v. OI,l€

Z?«b Mototivity™

Another milestone in the

history

4v.v

fishel'les to

income group is

expanding. Only one out of 10
taxpayers was making $5,000 in
1955, but in 1980 it is predicted
that four out of 10 will be mak-

"fmtJ

p'„ fi)dn

fiiJLd

^ P

Movirftlo„

! /

tia

Domestic investments (gross do-

.lumped 90 /o irom 1947 to the growth of Canada
present.
y
*
in some detail,

certain wasteful

and

costly

tices in the construction
.

prac-

industry.
.

capital

formation)

Northwest Territories. The future

is also indicated

Young and older age groups are
Another outstanding feature of
growing the fastest. For exam- the work which again illustrates
pie, from 1956-1980 there is

^
}?al

^ ot

ann«i^? n^i

pestic

national union adopted
ten-point program to eliminate
a

•

ly when
a

(XV111CGS, QllGbGC^ O1113.171 Oj
Manitoba, Saskatchewan, Alberta,
British Columbia, The Yukon and!

ing lliflt amount

of labor relations occurred recent-

the extent of research, is

list of

expected increase of nearly 70%

time» and °[hei ieathei bedding

woU^outnut and the
Vwork output and8 th^ use of eT
ana tne
ot etwoik
of eiw^n?h»t h»?Vr Z*52® Hcient tools and equipment. Think
^^441^

Canada's higher

manufacturer's

use

cnmofin'nrt

locations in all incorporated and

of those

unincorporated

crease

under

30;

51.8%

in-

people between 30 and

92.2% increase of those

59, and

60 and over.

areas

over

1,000

inhabitants.

ceded

(It is generally conthat this is the only such

list ever compiled.)

industry figures discrepancy that exists today
for 1954 through'1956 indicate that
Mustrics
the average labor cost per ton of are
certainly entitled to protection
product in our steel plants is about against unfair foreign competition.
twice that of the European Coal
By this l mean the dumping 0f

what a tremendous boost it would Canada's population increased 15%
"A real understanding of maroy
is exI
wvim-vviuc
wciaih 1!W
« V?
hlltw pected to show by 1UOU iS CX" 111 itself°" 3 worId"wldemeans of
1951"1956 a"d 90% gain, or —' * a fundamental basls
1980

Community companies, foreign merchandise in this counGranted that the basic raw ma- ^ry a^ prjCes substantially below
terial. cost
in
the
Community those charged in the exporting
countries
might be somewhat e0Untry
The Anti-Dumping Act
higher than in the United States, of 1921 offers such protection. We
our calculations still indicate that
jPust have greater enforcement of
the Coal and Steel Community's this act
tnis act"
total costs are lower than in this
And next, it seems to me that a
c0H."try*
Ku
l°t might be gained from the es-

These are outstanding examples
ratG
Saod that can be accomplished when management and the
Most Favorable Factor
working forces break down the
Probably the most important
barriers of misunderstanding beIi_
tween them and get together to aspect of the Canadian economy,

this

basis,

''S^^domesUc

and Steel

•

the

and

Coal

Euiopean

Steel Community vzuijipciuita persieei c^ommuiixLy
companies

mits them to sell certain products

—notably ' reinforcing bars
and
barbed wire—in the United States
at $25 to $35 below our domestic
prices. Ocean transportation and
our

low tariffs

kovimov

—

barrier

are

|abijshment of
.

pi-

My second observation on a
middle-ground approach is that
jiixuuxc—giuunu
we should do everything possible

rising standard of
living in foreign countries. In this
way we will help to equalize our
wage scales and to stimulate conto encourage a

countries

those

they will have less excess steel

to sell
.

demand

over

here.

One of the most powerful

tributions
direction

can

find

con-

make

this

effective

to export our philosophy of
markets.
We must get our

way
mass

free

world

neighbors

under-

stand

such concepts as the
real
dynamics
of
competition.,
the
planned stimulation of consumer
wants, and the necessity to make
this resulting demand effective by
a wider spread of income.

Our technical aid programs pro-

vide

tional

powerful tool in this educaprocess.

Many

you

world trade

field

f steel

are

Now,

I would like to discuss
point that concerns me
very deeply, and that is the everrising cost of putting our goods on
the market. We must stop the
spread of wasteful and inefficient
practices which are rapidly pushing our costs to the point of destroying our markets both here

and abroad.

Perhaps this is the unfortunate
but natural result of

from

our

rapid rise

infant nation to the lead-

industrial
and
commercial
power in the world. Like the suecessful prizefighter, we are losing
that hungry drive that brought us
to the top.
And if we don't do
something about it, we are going
to be knocked off one day by
someone a little hungrier than we

ing

are.
We talk about pay for hours not

worked

I
of

than

people, with the labor
force increasing at even a faster

reducing trade barriers, discriminabon, waste, poverty, and international tensions," the volume de—
.

clares, n/lrlinrt
nlnvnc? adding that <>AKiriAitn1vr 4-Vixv
"obviously, too
removal

spirit of mutual cooperation.

closing,

may

increase

say

that, while

Uicre are many points of controversy 011 the foreign trade issue, I
think any°ne can deny the
following facts, which should be
give)1 ful1 consideration in deciding our future course 0f action:
(1)

Foreign trade is essential to
United

States and her free

t^fnl fithPr

investments

ture production

for

purchases
ances

household

Canada

alone

leave

fmnt

the

and

nrn-

ohSaele

£er

oosiacie iu

(3)

The

United

States

long

ready

come

trade

liberalization.

way

has

al-

toward
are

high tariff nation.
(4) The warning signal is flashjng> The increasingly painful effects of foreign competition in our
domestic markets point clearly to
longer

the

need

m0ving

for

any

extreme

caution

further in the direc-

tion 0f free trade.

year in 1965,

and

narrowed,

Arthur P. Ambrose Joins

W. E. Burnet & Co,
-

Arthur
miuux-

P.
x-.

Ambrose
^muxuse

has
nas

beue-

associated with W. E. Burnet & Co., 11 Wall Street, New
York City, members of the New
York Stock Exchange, as a rcgistered representative. He was for-

come

Vercoe Adds

Staff

(Special to Thr Financial Chronicle)

COLUMBUS,
»

Ohio

Burt

—
x

Bush has been added to the staf£
of Vercoe & Co., Huntington Bank
gpecial section deaii,lg with pri- Building, members of the New
vate and public expenditures. And York Stock Exchange.
»
of great significance Qf retaining ;
people is the fact that Canadian
Joins Walston Co.
chain stores handle almost the en(Special to The Financial Chronicle)
tire sal?s volume of a variety of
EUGENE, Oreg. — Joseph W.
tfoods, including a major part of
Wick has joined Walston & Co,
f°od sales.
Metropolitan Montreal, the vol- Inc.,
points out, is the foremost
trade area in Quebec Province,

101

East

Broadway.

ume

With oyer 5,000 plants and 240,000

ing center for the manufacture of
ofrrroft and aircraft parts, railway

owri

*• Wa,tel Thompson Company.

Mining, forestry and manufacturing are treated in detail with a

degree of tariff protection is abso»"■><->00 W.°

costs

„

d?YSe S,ver

average by 1965. From the annual

foreign production
a
reasonable

our

Until the wide gap between

series

appli- merly with E. W. Lucas & Comexpany and Hayden, Stone & Co.

workers, it accounts for almost
60% of the manufacturing and
production in Quebec. It is a lead-

(5)

trado

are

nolfcv
average of $366 million in 1952-55
1inRa^ia^^cfands^ readv to ?teD li wi^ m0Ye up to $718 miUxou a

5 ^
hrpaoh
in4Arnn^nnoi trnfip
Huotinn
poYiV

and consumption

dom's hardly increased at all.

major world markets compiled by
T
w

fu-

—at higher rates than other leadhlg countries. Compared to her
prewar situation, Canada's investments more than tripled, whereas
those of the U. S. reached twice as
high a level. The United King-

i^ugtrics^—^ut3^there ^re^crave pec^ed
™

her

restrictions

expansion."

5e Canadian Markets" is too
of volumes

f
fourth of

ability to sustain a high level of
consumption and at the same time

Conclusion

encourages

of the

another

population

million

the continued growth and security

The Cost Problem

attack their common problems in the volume indicates, is Canada's

Such

HnrtlnnZ-iuc?l
"e®f P1®'_ ?" _JY?: f.® "nH thP
^r;/iT Trnn
FprWathm
™ LJana caeei reaeiai
nas aone ior in
sieei mausuy ux.

of tWs

„

asso-

rnntHhuta

pould

nHvanrpmpnt r>f world

nvaaniyafinn

„n

the United Kingdom.

all.

sumer

fa? siebted sueeestion
?aYa
rnsugSestion
P^011191 union
the

rtn

This cost advantage

some

—

With Fabian Co.

(Special to The Financial Chronicle)

BEVERLY HILLS, Calif. —Ira
A. Hagenbuch is now with Fabian
& Company, 9500 Santa Monica

Boulevard.

The Commercial and Financial Chronicle

(2422)

Continued

which

from page 10

The Stockholder:
The
that

company that finessed this prob¬
lem by allowing any stockholder

interested in

president of so fast-growing; an:
Operation as Federal Pacific Elec-;
trie Co. said, "It is easier to sell:

to that.

held

Now the

what

meeting is
some circles is

a
"clean,
well-lighted
machine- one of them—within the last year called
contained the or two had come to market with place." But the meeting is still
least information most valuable security offerings. All of the six, haunted by the shades of fhe past.
consequently — all of them — had It is loaded with "shills"— em¬
to the stockholder.
y
He got particularly hipped ion filed registration statements with ployee-stockholders who toss tip
divisional sales figures.: They are the Securities and Exchange Com¬ the nice easy questions that the
Every one of the six chairman unfailingly knocks out
figures * that no security analyst mission.
likes to be-without and figures consequently, had put out a pro¬ of the lot.
'■:
This is stockholder relations? It
that no investor can be really well spectus. And in the prospectus was
informed-without. So here's what spelled out in detail the informa¬ is nonsense—and perhaps an ex¬
tion all but two of the companies treme case. But it is not too un¬
our boy did;
1
He carefully chose six annual- had declined to give our boy. This common and I think again indica¬

printed

90-pound

stock often

coated

relations?

stockholder

reports, alt of them slick produc¬

tions that

This

nonsense.

meticulous

an opera¬

icism of any kind by

simply indi¬
quote — "A question and
answer period followed the chair¬
man's address." Unquote.
cating

—

have

heard

even

the

report on the an¬

reminds

its

own

open

way

of the Irishman who

claimed to have

'•

Well, there are lots of reasons
why managements who have not
changed their minds about stock¬
tive that some managements are holder ' relations,
or
who have
injecting into their alleged stock¬ changed only to the point where
holder relations the cynical con¬ they grudgingly go, through the

tion

them

who

without

divisional'

break¬

that

What

our

did was write
companies—not as a

boy

some

strong indica¬
managements,

damn

can

well

their

mind

business. Either that, or these

managements have embarked on a

takes

that

to, invalidate

tend

all

stockholder relations
This is perhaps less true of mid¬
program—that they are just not dle
management than the very top
a private citizen.
It was a very capable of carrying out to its full¬ brass itself. You can hardly indict
polite1 letter,, almost as polite as est expression. And in either case, an executive because he lacks a
some of us might be to a bore at
they are just not worthy of their sense of humor or because he has
hire.
a cocktail party. The letter praised
never learned to think quickly on
the annual report, but noted that
Our reporter was—he earned his his feet.
These are grace-notes,
it lacked- divisional sales figures. hire. The replies he got were po¬
but some of the boorish displays
These* it went on, were vital for lite enough — but politeness is of bad temper I have seen at an¬
any intelligent assessment of how never enough to cover absurdity. nual
meetings really show how
the company was faring against Disclosure, even if frostily deliv¬
closely the ape sometimes lurks
the competition — and since the ered, was what the situation de¬
behind
the stockholder-relations
competition had undoubted 1 y manded—and except for a minor¬ mask.
each of these

program—a

"Herald Tribune" reporter but as

made it its business to learn these

details, shouldn't they also be
given to the people who own the
company—the stockholders?
The replies were very interest¬
ing, They were very polite—al¬
most as polite as the attention you
might give& to a bore at a cocktail
party; I'm not going to give you the
names of these companies, though
at least one of them is represented
here. We are ail big boys-How and
able to cast the motes out of

our

eyes—but let me read you
part of one of the replies. It was
own

ity, it

not forthcoming.

was

Disservice

corporation should be without.
This company has a number of
divisions—and* our vice-president

friend started out by noting that
no one of them is
"completely in¬

dependent" of the other.

Then,
taking a deep breath, the vicepresident went on to say—quote—
■'We have always felt; therefore,
that any figures which might be
supplied for any branch of our
business- would
be
misleading
without a complete description of
the account methods used

in ap¬

portioning, overhead and without
art

analysis of the type of business

done and this would be undesir¬

able^ if done in such detail

give confidential information to
our competitors and also at times
to

our customers."
Furthermore
the reply went on: "I don't believe
our

competitors'have any such de¬

tails

regarding

our

business

you

suggest."
Arrant Nonsense

This letter, I assure you, for all
its torrential, run-on
power, is not
by James Gould COzzens out of
William
Faulkner
and
Thomas

Wolfe.

It-is

letter written

by a
well-paid executive ostensibly to
one of the people paying him.
It
ia

good measure of the lack of

conviction—or
an

dedication—-behind
alleged stockholder relations

program-on which- this company
is spending enough money yearly
to keep us all ih' Beefeater mar¬

tinis for

long time to come. And
furthermore — it was all arrant
a

nonsense,

was

all arrant nonsense be¬

Street

has

Main

come

stock

vice-

to the
;

in¬

=V >

■

Financing ,:

Investor" is the key

t"o

offering

couldn't

because

the

get

make the

price

move

suc¬

It had never taken any

cess.

pains'

investors—either real

rOmariCe

potential. Its earnings are up;
in contrast to those of the; indus¬
or

try in Which it operates, but that
doesn't do it any good.I 'It just
never
made the effort to keep

Street.

shareholders
and through th<6ni
community — in¬
though perhaps one day it the financial
will be.
In the meantime, how¬ formed. Now it's paying the pen¬
ever, New York Stock Exchange alty. The plain fact of the mattef
survey figures indicate more than is having your stock sell at as high
60% of all the nation's stockhold¬ —or higher—price/earnings ratio
than the competition is not the
ers make more than $7,500 a year
—an
income that is enjoyed by .worst thing in the world. It can
I don't think that is

yet quite the

—

case;

help you "finance more easily; it
carfhOlp the big brass thresh out

about 10% of the total population.

This

means

lists

represent

that your stockholder

purchasing

;

quite

chunk

the

you sell consumer goods,
too important a market to

favorable

terms

power.

merger

terms

much

on
—

and

gives that minority of insensitive
investors unimpressed with your
brand of stockholder relations, a

this
cut

yourself off from. Stockholder, re¬

Meetings

good stockholder much more liquid market in whicli
unload.
Stockholder relations;
some degree give •to
for examples of "this — or need you a pre-sold market.
General you see, can be a form of selfpetitive disadvantage. Premature much imagination to realize what Motors^ for instance, thinks that preservation.
;
disclosure of a move into new it can
Keeping
the
stockholder1 a
do
to
a
really, fruitful its 500,000 shareholders help it to
markets, of an upcoming bit of stockholders'
sell hundreds of thousands.of cars. friend, in fact, can make for self-^
relations
program.
financing or a new product—un¬ Not too long ago, for instance, a American Tobacco is forever urg¬ preservation in more than one
Granted, there are times when
can put you at a com¬

lations

You don't have to go

far to look

—

really

relations—can in

disclosure

der

circumstances—can hurt.

some

Obviously there is a line beyond
the

which

frank

disclosure

that

is the stockholder's

should

and

right cannot—
not—transgress.
But

try and bury like an idiot cou¬
characteristic of the lot and ap¬ sin, information that
any reason¬
parently written by one of those ably energetic 10-year-old can
irice-presidents m charge of se¬ ferret out, is to do both yourselves
mantics and circumlocution whom —and
your stockholders—a dis¬
no

Stockholder<

important one.

Effect

needed to

You hear lots of talk that Wall

•

Happenings
Secrecy

the good will that they started out
with in the first place.

financial

investor."

halt

though

own

downs.

heard from before."

the

"Informed

just

viction that you can catch more motions, ought to smarten up. Not
putting the best possible flies with honey than vinegar. And the least of these is the fact that
face on things, still generally re¬ if that is really not the
case, then the stockholder is| not only an in¬
gard the stockholders as intruders they are making senseless mis¬ vestor, but a consumer as well—

is, I submit,

phrase here. When the plug. was
pulled on the bull market last
Summer, plenty of new equity fi¬
nancing was called off. We know!
of one company that had to call;

shouted, "I'd like to see
can make me change it."

who

envy; all of them emanating from
companies that like to pride them¬
selves on the "expertise" of their
stockholder-relations—and all of

magazine

which keeps
of its name than'

•id./

mind and
the S.O.B.

"Life"

aware

never

formed

This is stockholder relations? It
in

public

one

directors

our

company

Small blocks

the Massachusetts hinterland.
hell—and

sell

Similarly,

meeting to examine a tran¬
script of it at its home office in

loan

nual

easier

one

could

tion

magazine in a sur vey a while back
quotes an Equitable Life Assur¬
ance Co.
executive, for instance,as saying, — quote — "It's much

post-meeting reports

that detour feverishly around crit¬

seen

of the six—every

one

Or of

text?

arc

Look" in stockholder relations has

Neglected Man

dripping with color and Yet every

were

stockholders

Thursday,, May 29, 1958

obligingly asked—quote—"to ex¬
press their views" — quote — is a
joke. The meeting, of course, is
no longer held
at a grimy little
mill, 250 miles away from the
company's main office. The "New

i .*

other

service.
And this disservice, I must say
again, is lip service; lip service to

the
in

ideal
fact

The

that

the

stockholder

friend—and

case we

not

foe.

have just cited is not

the only
mind.

have

example that springs to
of other
companies
all the trappings of good
Lots

stockholder

parently

relations

and

ap¬

of the conviction at

none

top management levels that makes
for really good stockholder rela¬
tions.

stockholder at
his

started to

relations

counsel

and, I suppose,
pays him something more than a
pittance. It has all the expertese
we talked about earlier,
including
an eye-popping four-color annual
report with lots of product pic¬
tures, but about as much financial
information
a

meeting popped

one

when

the

move on<®e

election

and

chairman

nomination

directors.

"Yackety-Yak"

come

the annual meeting

approval—and

that

all

any

stockholder needed to know.

Be¬

sides,

had

was

management

already

votes enough in its pocket to elect
the directors.
Protest couldn't

change anything.
next

order

Voting

business.

was

the

Would

the Stockholder sit down and stop

holding

the meeting—he could

talk about the directors

question and

answer

during the
period.
r

Sure he could talk about the di¬

after

they

elected
and the point he had, to make
would no longer be germane. This
is stupidity—if for no other rea¬
son
than precisely
because the
stockholder's inquiry couldn't
change the election results. If his
—

protest made
not

let him

were

difference—why

stockholder.
As

matter

sanctum

—

it has been

lagging behind its competitors for

consumer

coffee

talk?

And far

even

reaction

fighters.
\
to owning a majority of
there is only one way
.to win a proxy fight—and that's

your

proxy

the stock,
to have
own
rare

con¬

speak to the point
Certainly parliamentary
procedure did — but apparently

than service
of

such to the ideal

stockholder

tives

who

are

collateral

the

same

kind

couple

wheeler-dealers

named

Richardson

found he had

—

survey

150

invest¬
■

ment

bankers recently unearthed
surprisingly widespread con¬

viction that

company can

want

in this

the pragmatism
hard fact of life that

place. They

own

that

turned

his

This advantage is

to pinpoint if your stock is
selling for less than the value of
the company itself—as in the case
of Montgomery Ward, for instance,
and

countless

other*

compante's

where management had no use for
stockholder relations at all.

But it is

secondary

can

advantage.

easy

Secondary companies often have
earnings ratios; sometimes
truism

satisfaction

also
point

better

Richardson- combina¬

the stockholders them¬
to the blitz tactics of an
outsider who senses that this dis¬

The Secondary Companies

faster growth rates.

tion among

are

the companies which make
of stockholder relations.

Murchison

selves;

the best known companies are the
ones
that
command
a
premium
in the market

the

cumulatively it can be
implanted in any group of stock¬
holders—-if you make the effort, ff
you don't make the effort, you are
vulnerable—either to dissatisfac¬

about

this, it is

"What

the name of
y'..
By any definition, that is friend¬
ship. It comes only rarely in the
concentration represented by the
tion, but

favorably affect the sale or
stability of its stock. Say what
of

asked

hell did you say was
that railroad?"

values
especially if
couple the program with fi¬
nancial advertising.

Thus, 'a

bought

$10 million worth of Central stoc£
and not only $5 million worth, as
he had supposed, lie called
up

large chunk of

stocks,

except in the last stages of a bull
schizophrenia exhibited in post .market, lag behind the market as
annual meeting reports. The post- a whole—and it is the secondary
meeting report, at least theoreti¬ companies that are usually most
cally, is supposed to be the epitome baghful about presenting stock¬
of quote—"professional"—unquote holders with a really well-defined
see

Texas

that

recall

help from

Guy Murchison and Sid Richard¬
son and the story goes that, when

you

the

extend to

some

giving the stockholder what is
right, you are also generat¬ Murchison and

even

can

had

his by

ing for yourself

may,

You'll

Central.

mediate chemicals, concrete rein¬
forcing bars or a commodity as
anonymous as. sulphur, you still
can't go wrong by taking up the
.gospel of stockholder relations.
Quite apart from the moral aspect

still

The Post-Meeting Report

bunch of friends who do

instances, this

York

is industry rather than the
individual—if you turn out inter¬

you

right to

at issue?

majority of the stock.' In

having friends with cash enough
to help you buy a majority of the
stock-^as the late Bob Young did
in winning his fight for the New

sumer

ultimate

job

preserving your management
ffom the onslaught of raiders and
by

first

documents the growing awareness
of the stockholder as consumer.

And

It may even save your

sense.

"Buy

Corp.

way

You

fact, the real
balance of power in this particu¬
lar little

instant

important—didn't elementary de¬
cency demand that he be given

the "real balance of power" in the

corporation is held by the small

Borden

relations; execu¬
living in the
opportunity
to
express
their dark
ages when stockholders were
views." There follows much yacregarded as foemen rather than
kety-yak—lip service—about how friends.

where they will, quote, "have an

—

Oh, the report offers plenty of there are some
executives who
lip service, all right. Its front
prefer to give lip service rather

page asks stockholders to be sure

shareholders

began spotting
to

the

could be got out of

Russian Commissar.

and

its

ing

American."

passing it
wanted to ask about the qualifi¬ around among stockholders and at
least one other food company has
cations of one of the directors.
a
special
order
department
The chairman turned purple. By
at
God, he wasn't going to have the through which stockholders
cost—can buy special gift pack¬
qualifications of any of his di¬
•
rectors challenged! They were all ages for friends.
All
of this
activity, I think,
good men and wise; they had his

rectors

One company I know very well,
for instance, retains a stockholder

feet

There

raider
of

are

can

lots

reasons

advance for his version

"throw the rascals out.".

Some

of them are

simply a reflection Of
bad management;
others lie in
that
twilight
zone
where
bad

years—is held by the manage¬
type in ment, which is shot through with —stockholder relations. Yet how "corporate image."
•
management is synonymous with
shop had picked his targets nepotism, horrendously overpaid
Salable stock is
many post-meeting reports do you
certainly .an [bad stockholder relations.
very carefully. All but two of the in relation to dividends and which know of in which stockholder
A
advantage to a company that plans
shaky earnings record, of
companies' argued that releasing collectively owns about 20% of
questions showing even a tincture to do any equity financing. Sur¬ course,.may indicate bad manage¬
division sales figures would give the outstanding stock.
of disagreement with management prisingly, it is even a help, in get¬ ment. It may also indicate, how¬
aid and comfort to competitors.
And
the
annual
meeting
at are ruthlessly edited out of the ting institutional financing.
Tide ever, a run of bad luck that will
cause

the Machiavellian

our

Volume

187

Number 5746

ultimately be reversed by

The Commercial and Financial Chronicle

sharp-

information and not just- the escape haich on countless ocConductan annual meeting caslons—but by and large he is
in there sawing away for some
comes into play.
Shouldn't stockthings that do make for better
holders be told what's going on?
r?
martial as possible.
martial as
Pay a fair stockn
stocknolder relations. Do you have
Failure to do so -may- make you dividend, make sure
you've got a any objection to more explicit un¬
fair game for a raider.
;v ; board ;;of directors that is more nual reports? That's one of the
Other failings may make you than just a claque—a
group of things Mr. Gilbert would like to
fair game too—and this is where yes men owing everything they've see/ Do you think post
meeting
bad management and bad stock¬ got to management; and last but reports are a work of the devil?
holder relations become one and far from least, put, your
money
Neither docs Mr. Gilbert.
Are
the same thing. Really inadequate where your mouth is.
you against annual meetings that
dividends,".-, exorbitant
executive
If management isn't willing to are fully attended and present you
salaries
a
gnd
expense
accounts, risk its pocketbook in the business, with
sounding board against
toHchnlrior
termor
ran
stockholder
over-ripe- stock options and bo- why should an investor? There is which
temper
can
nuscs, either singly or in combina-/only :< one
quick way to will a : really be measured? Neither is
tion, arc all a slap at the stock-- proxy fight—and that's before il, Mr.: Gilbert.
Do you think the
a

convey

penciled management. Andthis is
where good stockholder relations

that is meaningful^-and graceful-and-as. unlike a drum head court

nition

the only kind of economic
system any of us wants.

Yet, it

fashionable
circles

management
stockholders

sheep

would be the last

they sometimes

think

and

—

;

to deny

one

show

all

holder—and

such

'starts./ The best - kind of win is
win by default. Nobody can chaiNo
raider will ever condemn lenge success—not a raider, not
them, though. They are all grist Wall Street, not even so voeifcrto his propaganda mill.
With a ous a "professional minority stocklittle help from a rising market,, holder',/ like
Lewis
Dusenbcrg
a.
speculative following and
a
Gilbert.
management
that
doesn't
own
demned

can

con-

bad relations indeed.

much

get

The

itself, he may really
by the neck. And what

you

price

stockholder

Plenty.

relations

heard

about

then?

what

Because

Activities

I've

stock

you've
got to do*then is make friends in
a hurry.
'Any ex-service man who

him

has

of- reporters

had

ever

wrestle with

the

rigors qf

eight-hour/passidn

crowded

making

town

friends

knows

that

hurry

isn't

always the easiest thing to do.
.:
Nor is .it easy—if you haven't
taken the pains to make friends
-

long

time

sit /on

ago—to

the

ragged edge of the pit and watch
the

pre-proxy fight build up. It
develops ominously—there will be
an

increased

as'

the

volume

rqiders

trading,
fattening

begin

called

the

unjustified

and

averages

comes

bad

time

mention

—

his

dark

to who is

vou

the.
*

Affirmative Program

An
This

is where

you've really *got

to start stockholder relations:/The
of

they want—and giving
A real stockholder

latibns program starts with
sis of the stockholder list.
Do

concentration
it?

without

name

street

names

particularly high

read

signs

concen¬

Both
im¬

pending fight for control.

It could

happen to you—it could that is if
you

think

real

stockholder

schnooks.

relations,

raider

speculative eye

will

your

for

cast

company

oniy if he is sure he can get someIthing "for nothing—-if your stock is
Selling for less than the company
is worth; and only if there arc
legitimate issues he can.ring
the changes on to mask, his real

some

intentions.

..This is

cleseyve—~ to ..his

this

takes

the

work.

full

Capital¬
of

potential

friendship that

can be tapped in
body of stockholders requires
than just an annual report in

any

enemies.

never

the

Tell your

company's story to the
We're willing to listen—
assuming you've really got a story
it

pictures

,ov™rc/ "»

shots.. That
leaves nine that have recognizable

•

that

the

at¬

your

present
nancial
your
are

potential.

only

daily

stockholders

advertising;

annual

not

they

are

either

some

make

and

fi¬

suie

interim reports
read, but that
reading—that they

easy to

are worth

touch

with

man

say

lim¬

very

indeed,

with

issues

new

wider

all.

between

few executives he

unsettling

time.

him

much

and

giving

bad

v..

the

still succeed

can

and

•/•.•...

Theo¬
a

of agreement than dis¬

area

agreement

Majeste—I'll show
igqy -he can't talk to me this
/Lese

lour? You re wrong-r—it is. not
Brigitte Bardot, Jane Mansfield

r^1<?lir?c*
GJibert.

^ 1S kewis Driven-

^ Difc^i't

scouj the

that I

confess

must

find

this

and

owner

pro¬

prietor of this report (along with
brother John) Mr. Gilbert could
have

himself

stuck

shots—and

nine

in- all

have

would

one

complained at all.
The

whiff

same

self-cffacc-

apparent throughout the
entire report.
Thus on page 18
we find Thomas S. Nichols, Chair¬
of Olin Mathieson, admitting

man

to Mr. Gilbert that

attended

annual

the

stockholders

meeting

which was held in Saltville, Va.
On

19 we find Mr. Gilbert
liking an option on 150,000
shares of common granted to A. M.
page

not

Sonnabend,
page

bert's
On

name

other

tioned
we

President of
21

find

Botany.
Mr.

Gil¬

mentioned only twice.

pages
much

find

six

men¬

and

times

not surprised to
^ee that
Gilbe.rt., .shrinking violet that

are

Mr.

he is, forebore to

list his

in
the index at the rear of the report.
That way we could have come up
with

tctal—and

name

much

think

this

big

They have been kicking around
since long before even the Transamerica case put flesh on the bare.
C/inii*"i4irtc<
L/vii/in

4-L/l

the

making
concept

even

that

ni-»/4

Securities

and

You may

the

and

way.

makes

scrambling

Labor

briefed

and

the

Yet the

think

this argument is

com¬

expect

when

time.

annual

Mr. Gilbert

can

vacuum

meeting

be handled.

can

other stockholder. But

any

it takes preparation, finesse—and

dignity.

If there

are

butes to

take to

any

better attri¬

other phase
of
stockholder relations, I have
yet to hear of them.
'

Gilbert

Mr.

—

other

any

stockholder—worth all this effort?
I think so,

and you do too, or else
wouldn't be here. As a matter

you

for

fact,

the stockholder, the
do is not good enough.

best you can
I think

least

than

the

seediest

Pravda.

the

own

They
of

core

know

and

editorial

writer

both hitting

are

system

our-

Board made

while back.

It turned up the

that all but 5%
cluded

the

harrowing fact

of the people in¬

quote

—

sample

"Too

would

This, of

—

not

psychological hangover from the pinwheeling excess
0£ speculative fever.
Blatant
manipulation and just downright
stealing.
We have been a long
time recovering from this and will
be

lact

his

for

that ethics in thc stock

mar_

iong since changed—for

want

What

staff

"Full

One of

this

Disclosure"

Concept

the

primary forces be¬
change was the new

of "Full disclosure"; the

conviction that mystery is
,

th
,

that

indeed

manipulation
.

manipulation, if

could fracture beyond

and
,

continued,

has

been

added

Kidder, Peabody
Co., 210 West Seventh Street.

&
..

Two With Dean Witter

reciprocity.

Any

than

they

want

investor,

any

MODESTO, Calif.
with

—

Joseph W.

become associated

Alexander has

Witter

Dean

&
Co., 1021
formerly with
First California Company. -

Street.

was

your

skill

and

judgment will at
very least measure up to the
competition. Does not this demand
your

the

an act of faith in
return, an ex¬
pression of willingness to give the

investor value received—and then
some?

This, by definition, is the touch¬
stone

tions.

It is

stockholder

good

rela¬

that any manage¬

one

ment, unless it is totally inept, can
easily put into practice. If it does
not put this concept into practice

through conviction, it can do so
through sheer pragmatism and en¬
lightened self interest.
But

put it into practice manage¬

ment

must—or

perhaps one day
penalty for not having

the

pay

done

For these

so.

days, there are
plenty of people around who are
in on the big secret. It is not only
the

economist

who

knows

that

??P«alism has changed its tradi
only th,
It.is not only the

form.

^10

economist

who

stockholder

knows,
longer

that

only

the

that

management

this

economist

management;

It is

who

not;

knows

nowcontrols

investment—capital

hires

the1"
and

runs

controls his investment.

longer

management

hires capital.

Legislative
This is

Threat

this child of eight. But
She was too weak to speak
»•

arresting switch. It is
only to economists, but

known not

gulf

the

fact

that

were

her eyes:

legislators as well. And some
legislators are showing increasing
restiveness

"Can't

for

doctor who

fade from the

the mild yoke of good stockholder
relations.
And so the answer to

friend

foe is

be either.

ambivalent

stockholder

cer

with

The

disease that ranks to¬

the Number 1 disease-

must..

•

it, and win

ATLANTA, Ga.—John W. Shef¬
field and Irvin P. Wolfe have be¬

over

•'

battls

First

American Cancer Society,

Corporation, 652 PeachStreet, Northeast.

striving towards that goal.
Let's

New Sudler Branches

;

Co.

has

opened

four

new

branch offices in Wyoming; in the

Emery Hotel, Thermopolis, under
Claude R. Hillier; in the First Na¬
tional Bank

Building, Cody, under

Weston,

Sr.;

and

the

give... boldly, gen-

eliminate this

•

and help

mortal

enemy

which will take the lives of more
than
year

250,000 Americans this

alone.

Send your

c/o

your

gift to CANCERj

local post office.

Hotel

Washakie Building, Worland,

With S. B. Franklin
(Special to The Financial Chronicle)

AMERICAN
CANCER

LOS

ANGELES, Calif. —Fred¬
erick Tillinghast, III, has become
associated with Samuel B. Frank¬
lin & Company,

Street.

Mr.

215 West Seventh
Tillinghast was for-

all recog-merly with J. Logan & Co.

erously to the American Cancel

Society Crusade
DENVER, Colo.—Amos C. Sud¬
ler

can

find ways to

Research, supported by tht

Southern
tree

killer of children. We

Join First Southern
(Special to Tile Financial Chronicle)

connected

in pro¬

But that's not enough! Can¬

an¬

day

come

sunlight of life—

cancer.

—thanks to recent advances in

Whichever he turns out

be, gentlemen, in the last
alysis, depends on you.

even

tragedy

the treatment of leukemia.

can

We had succeeded

one.

both; he

...

victim of

sees

longing her life by many month!

question of the stockholder—

The

to watch a child

enough

could flare up into law that could
be infinitely more demanding than

see

xnakm

you

again, Doctor?*'

creasingly wide. This restiveness

the

plain to

It's terribly hard

management
and
begun to yawn in¬

has

well

tne

the

between

capital

•

the words

under Edward H. Schultz.

pie better.

ANGELES, Calif —Walter

Hamilton

the

destruction.

own

Ralph E. Cook; at 113 North Kenlong time yet> despite the wood, Casper, under William H.

ke£ bave

Exchanges.

(Special to The Financial. Chronicle)

Stockholders

dividends.

un¬

is a hang¬
wheeling days

Building,
and

York

course,

from the free

of 1929. It is

risky"

Ford
New

(Special to The Financial Cbrontcle)

LOS

buy common stocks because they
—

the

Kidder, Peabody Adds

each, in their
within themselves

the seeds of their

do if

thing of the survey of consumer
expenditures the Federal Reserve

Co.,

Stock

they

way, carry

all understand why, at
we have seen any¬

Detroit

com-

an oh-so-knowing gradu0f the Harvard business school

a,|

members

stock¬

sweeter

associated with Watling,

now

Lerchen

emotional

comes

are

ing from

Association

National

intellectual

concept

case—and Lord knows his rasping

staff

(Special to The Finincial Chronicle)

DETROIT, Mich. — Thomas A.
Mackay and Bernard K. 'Walsh

holders—capitalists, if you will—
as
sheep, too. And the stink of

Ex¬

orotundities have sent members of
my

the

neither should you permit the big
man—The Boss—to operate in an

hind

quarrel with

year

Manufacturers, would you? Well,

explicit the
stockholder is

Gilbert sometimes

Gil¬

have

this

can

the

Mr.

stockholders

minds

the

The

and

entitled to "full disclosure."

Mr.

ation

'34, thus

'33

out,

other annual meet-

other

boss

over

t
go

pitfalls ahead? You wouldn't write
a speech for the American Feder¬

quote.
the

anybody

advance—what

and

their

makes

clear

1 dlvuuuJ

out—in

are

interesting story, perhaps.
But

way.

anybody take the
U1C
elementary precaution of finding

mcnt

this

Doesn't

wow

/wTte

te bhw

bert

°r

munists

unso¬

25 years

some

retically, at least, there is

bones

who

contro-

unhappy,

precisely be¬ small investor who has his
money
of filibus¬ in
your company is making an act
tering he has been able to come up'
faith,
an act of faith that

these/iifne, guess who is featured

change Acts

Tell your story
bankers, brokers
and security analysts — thc speinvestment

vision

cause

individuals in the foregrounds Of.

with

ited

group

are

worth the telling.

bialists

that he is

soggy

press.

nothing

advocates.; In fact, you might

seen

sand¬ point. Mr. Gilbert is a modesc man,
wiches
and
papier-mache apple who makes only modest proposals.,
pie that pass for lunch at the His proposals, in fact, are nothing
more
than
that.
They are not
annual meeting.
novel; they are not earth-shatterTeU Your Story!
ing, they are not revolutionary.
technicolor

that

phisticated animal.

...

clpse. a' round dozen pictures ot
stockholders and sloe k h o I d e i

But

there

ot^iccr This is childish. It is not a clear
anything
V
• • Maie*te-±4t
Thorniest edition,;:^
SSSiKS

1 VL

situation in which an
ounce
of prevention is worth a
pound of cure; a pinch of stock¬
holder relations savvy is worth all
the high-priced legal., talent you.
may have to buy later on.
izing

cou-

necessarily >yhat they

anoiy-^nd °t m?d<»ty
After all, as sole

tration of margin accounts?
can

ve¬

have particularly high

you

never

voting,

cumulative

for

save

versial about anything Mr. Gilbert

real stockholderrrc- '1,1

any

it seenislto me,
is knowing who your stockholders
Jations prpgram,
are, what
il to them.

few

fact;,

stocks.,mcptings in action. .'Three of The jngs?

buying the

the

couple

y in

pling. it- with a curse. I've heard
Yet for all this agreement, there
Mr:: ;Gilbert called a publicity are many executive nerve endings
hound—and his own annual report on which the play of Mr. Gilbert's
indicates that this indictment may personality is as abrasive as a
.not be entirely without merit.
Boatswains Mate's
whistle
to a
I'm sure, all /of you have seen Boot Seaman—and I suspect this
this report—or at least heard of parallel is not entirely inaccurate.
tt- AH in all it's quite a document, Lots of the brass have not been
In, it; with magisterial impartiali- spoken to harshly since they won
<Y, Mr. Gilbert pats his friends on their vice-president's stripes way
the bade and dispenses justice
back there in'08. It's a clear case

news

lag between sales and trajis-

with

know

bia jump in the amduntvof pUg to It.
.stock held in street names, and a *<»' instance' ^ucles
fers. designed to keen

maybe

I've heard

and quite
executives—who can

future earnings-prospers
dends. Then

things said

"voice
I

...

Gilbert

and

—

true.

are

builtr-in/snear."

their, holdings, and often as nob a
;
..,
boost in price disproportionate to-though;-not
,

Mr.
of

Gilbert

Mr.

of them

some

lot

regional annual meeting is a bad
idea?. Neither does Mr. Gilbert.

tributes

With Watling, Lerchen

some

135

(2423)

SOCIETY

The Commercial and Financial Chronicle

(2424)

Thursday, May 29, 1958

David Morris
Mr.

David

Mrs.

Continued from page

Trip

Morris

Our Reporter on
JL

(David Morris & Co.,:New York
City)/will leave May 30 via Pan

.•

„

>-,<♦>

5./V?

;

Governments
M

*«

■

•* -

"*•* •

4m -' *

By JOHN T. CHIPPENDALE, JR.

=
r'i December that the number of new claimants fell below 400,000.

Government securities have been moving back-and forth
with

the

worker filing; a first

be expected

range, because no pronounced changes were to

narrow

refunding so close at hand. The market has
shortest maturities, with the result that
price movements have been largely ,of the professional variety.Meetings between Treasury officials and the several outside expert
Treasury

;

for payments does; not actually get
later, so the: new claims, figures run a week
ahead of the reports on those actually drawing the benefits.
them

until

claim

week

been thin, except for the

groups have been going on this week about the way
refunding operation of the Government could be handled.

the
.

There

has

been

considerable, discussion and

operation of the Treasury, the terms of which are expected
announced today (May 29).
The guesses run all the way
just a June 15th refunding to one which will include
offers to not only the August but also the September maturities.

"Ward's" noted that last week's schedule paralleled the pre-:
V ceding week's total of 87,407 automobiles, which was the highest
count since the final week in March.
The statistical publication

from

The issues

r//

Morrl*

David

American

Airlines

;

for

well

month's

from

way
tion

to be used in

well

certificate,

prepared for whatever

to London,
Amsterdam.
trip
Luxembourg and France.

Canada

—

the eleventh time; and the

Langill, Hugh Mackay & Co., has
been

Chairman

elected

show

great

cpnimercial paper; rate by Vs pt l %-for

successfully with Treasury bills which had gone well below

where Lincolns and Thunderbirds

"Ward's"* reported that
date totaled

the

level.
'
-/-•/Y* -'•►/
It is evident that the demand for Treasury
1%

Board of the Canadian Stock Ex--

change, succeeding Ernest McAteer, Graham & Co. A. S. Beau-,
bien, L. G. Beaubien Co., was
named Vice-ChairmarfT and W. L.
Dowries,
W.
D.
Latimer
Inc.,
Secretary-Treasurer.

;':7

•

Sept. 15 and the proceeds

bills is coming

Treasury obligation.- Also, it is reported that corporations have

Daniels, Guiney With

This

Midwest

Government

security.

Stock

•

D. II.

Blair &

New

York

will be formed

Ex¬

formerly

the

of June

City.

15th

the

Co., members of
Exchange,

advices

being

received
•

from

most

Partners will be Hyman L.

Market Prepared for

Iselin,rCharles J. Miller,
W.
Miller, Kenneth B.
Ortman, Harold S. Stonehill, mem¬
bers:, of the ' Exchange, ' general,
partners,.and Robert. I. Cummin,
Robert

The

•

Refunding Operation

and

Louis

Schrag, limited partners.

money market for several weeks
It has brought with it more than a considerable amount
of
"open mouth operations," as well as some real master
minding as
to how. it should be taken care of.
Not only are the June-15 maturL
ties involved in these
guesses,, but also those, for August and
September as well, since it sbems as though these opinions are

not

without

corporation

U. S. GOVERNMENT

that

one

much

time.

can

accomplished

The

need for investments to

offset the decline in loans which

large extent represents continued liquidation of inventories.
In this way, the
money supply, purchasing power and deposits
would be kept from
declining too sharply.
t
a

°^er band, it is evident

ideas

about

the

that Treasury officials have
pushing out of the debt maturity and

eYen a token extension would seem to give them a certain amount
of satisfaction
irrespective of whether or not it fits into what is

Federal agency

considered to be

debt management

current economic conditions.

securities

Ki/^he recent reduction in the
% was

policy that is consistent with

British bank rate from 6% to

expected and is another sign of the world trend towards
interest rates. Its effect on our
money markets, as in the
past, was nil.
lower

out

that

Jan.

1 to

LOUIS, Mo.—Counselors Re¬

Goodkind, Neufeld & Co., mem¬
bers of the New York Stock Ex¬

search Sales Corporation is engag¬

ing in

change,

offices

June

Aubrey G. Lanston
& Co.

will

formed

6, with offices

400

Park

Officers

securities
411
are

member

Robert
of

the

Goodkind,
Exchange, and

Philip M. Neufeld.

Secretary
was

James

Seventh

Treasurer.

Mr.

O'Brien,
G. Weir,

Mr.

Weir

O'Brien

was

20 BROAD STREET

Bingham, Walter Branch

☆

CHICAGO

☆

PANORAMA

☆

Bingham,
BOSTON

CITY,
Calif.
Walter & Hurry, Inc.

has opened a

Union

branch office in the

Bank Building under the
direction of William L. Marlin.

New Alex. Brown Office
FAIRFAX, Va.—Alex. Brown &
Sons have opened a branch office
at 104 North Payne Street under
the management of Norman Farquhar.

better

production

over

the

'. /_/\**:; ;/;
attribute

inventories have

been trimmed from 19,000,000 tons on
13,000,000 tons, a level at which some replacement buy¬
be expected. They say, too, that some consumers are

possible price increase

operations

continue at the

July 1.

current

Several top steelmen think steel prices will go up as a result
Charles M. White, Republic Steel Corp.
Chairman, feels the price increase should be $11 a ton "because
that's what the cost increase will be." R. L. Gray, Armco Steel
Corp. President, thinks a price increase is "inevitable." Avery c.
Adams, Jones & Laughlin Steel Corp. President, believes an in¬
crease is justified and Arthur B.
Homer, Bethlehem Steel Corp.
President, states: "We'd have to raise prices if wages increase."

of wage increases in July.

metalworking weekly said it's believed that Detroit's Big
close their plants from one to three months earlier

will

usual

to switch to 1959 models.
General Motors will prob¬
ably start closing its assembly plants in July; Chrysler will go
down in late July or early August and Ford will follow in
Sep¬

tember.
It

still

looks

if the United

contracts when the deadline is

Auto Workers union will sign
reached, "Steel" magazine predicts.

The scrap market boosted by the steel rate advance gained
strength for the third consecutive week. "Steel's" composite on
1 heavy melting was at $33.50 a gross ton, up 67 cents.

No.

with

Yates, Heitner & Woods.
NEW YORK

reported

rate, May production
will reach 6,000,000 tons. June output will top May figures by 2
or 3%, some market analysts believe.
They are less optimistic
about July because automakers will begin shutdowns for model
changeovers. Vacations also will slow consumption in other in¬
dustries.
Further, customers who bought heavily in June as a
hedge against higher prices will be out of the market during
July.

St.

formerly with William With-

erspoon.

*v';;-7V

business from

North

Avenue, New York City. Partners President; and William
will

districts

^ 7:..

ing can
hedging against

than

Counselors Research
ST.

three

but

The

Co.
To Be Formed June 6

• 7 • 7 '
;// {
higher production to gains in
demand, although less than seasonal for construction products and
scattered improvements in miscellaneous buying.- They also point

Three

Goodkind, Neufeld &

Industry observers

big

Steel output rose for the fourth consecutive week with the
operating rate up last, week three points to 54.5% of capacity or
the highest level of production since March 2.' Output was about
,1,470,000 net tons of steel for ingots and castings.
;
;
j

/at 67%. -

money market has been well
prepared for this operation, and it appears as
though almost any
of the issues which are selected to take
care of those
coming due
will be well received. The main
appeal will most likely be made
to the deposit banks in this
refunding, because these institutions

definite

and

support
all

effect of improvement in

ended May 17. This is its third consecutive rise, marketing
highest level in seven weeks. A year ago, the index stood

All

now.

have

Specialists in

INCORPORATED

•

previous week "with the biggest gains at Cincinnati at 62%, up 9.5
points; Detroit at 44.5, up 7 points and Buffalo at 44, up 5 points.
Other districts: Cleveland-at 30.5, up 4.5 points; Chicago at 60,
up 4.5. points; Wheeling nt 73.5, up 2.5 points; St. Louis at 78.5;
up 1.5 points; Mid-Atlantic at 49,. up 0.5 point and Birmingham
at 67, up
0.5 point/ Pittsburgh at 52% was down 1.5 points.
-Youngstown remained at 45, New England at 40 and the Far West

Harry Janin, Sidney B. Lifschultz,
Miller

steel output, electric
output, freight carloadings and auto assemblies raised the
three points to a preliminary 125 (1947-49=100) for the

at 152.
;•

refunding operation of, the Treasury has been the most,

important near-term force in the

index
week

quarters of the money
v'I /

■

power

the

York

bert -M.

•

market.-*/./•

5"with

Federman, Philip, R.- Egner, Her-,

Michael

September have already disposed of these securities
and
some
of this money has been reinvested in middle-term
Treasury obligations as well as tax free issues and even, in some
instances, in corpprates. There has been no important buying of ;
the longer-term Government bonds from these
sources, based on

Stock

offices at 42 Broadway-, New

Capacity :'*_*- >;

The combined

'7.77

,■■■;?.

The pressure of funds seeking an outlet in the short-term
market will eventually spill over into other sectors of the
Government market, and the intermediate-term issues are be¬
ginning to show signs of this already happening even in face of
the coming refunding operation.
According to advices, not a few
holders of the Government obligation that will be retired
through

j D. H. Blair Co. Forming
;

Steel Output: This Week Set to Yield 56.5%. of Ingot

Industrial recovery is gaining momentum,'."Steel" magazine
reported on Monday last; For the first time in 41 weeks with the
exception of the post-Christmas period, every segment of "Steel's"
industrial production index increased from the previous week's
reading. /
f ; :
'V.c.Y; \

iponey

partners in Apgar, Daniels & Co.

the

•»

•

77;7'-7;777/'7' I>ressurc of Money Continues

Freehling,

were

•; t. •••* J;-/

•;■

"bills

shortest

Co.,

Both

preceding..; h

•'

In addition, the purchases of the most liquid
by the Federal Reserve banks has. also been j.
in pushing down the yield on Treasury bills.

only" policy, of the powers that be, for open market
operations has always tended to press down thft4jeturn pft Ahe

120 South La
Salle Street, members of the New
and

expected; to reach 13,143 units

was

CHICAGO, Ill.r—Harry- C. Dan¬
iels" and "Karl B. Guiney have
f

York

^
to
or

Monday,. May 19. *.

on.

(

bills partly from funds which
disposal of longer Governments and

(Special to Tiik Financial Chronicle)

changes.

;

1,837,681 units.'This is 951,871 units

estimated

issue

important

very

Freehling, Meyerhoff

also been sizable buyers of Treasury
have been obtained from the
Government

Meyerhoff

cars and
1,065 trucks contrasted to totals of ;8,469 and: 1,367, re¬
spectively, the week before. The decline resulted from the na¬
tion's Victoria Day. celebration which .closed all assembly plants

other investments.

become associated with

goal

9%.J

'V *•>' "Ward's" reported Canadian programmirig, last" week :at 6,971

being put into the shortest

are

May

produced.

are

compared with 16,755 in.the week

many sources,; with indications that the banks have been
sellers of the Government issues that have been called for redemp¬

tion

its

ear; output for the/calendar year

Truck volume last week

from

reach

§ 34,% below; lihie corresponding' period of 1957 When.6utput .stood at
2,789,532
'fi I
•

the

likely

will

industry

the

Seven car assembly lines across the country were idle all dur¬
ing the week, "Ward's" added, with each of the Big Three mem¬
bers, General Motors, Ford and Chrysler, sharing in the shutdowns.
Down the past week were four car-making plants of General
Motors/ two Ford units and a Chrysler plant.;: Continuing six-day
scheduling were American Motors and Ford's Wixom/Mich., site,

;

the fourteenth time "this year. The. cut ift the banker's acceptance
and commercial paper rates was made so that. they, could compete

Elects New Officers

•

continues

market

money

that

77''';

along.

strength with the result that Treasury bills are at the'lowest "
yields in more than four years.* Accordingly, it was not surprising
when the banker acceptance rate was reduced by *4 of L%, for/

Canadian Stock Exch.
MONTREAL,

comes

Huge Demand for Treasury Bills
short-term

The

;

predicted

345,000 cars, which would top April's 316,503 figure by

long-intermediate obligaA
The money market is, however,

short'note to

venture also bring guesses all the

long-term bond.

this

States pas-;

estimated 86,032 units,Friday last.: However,:
Memorial Day shutdowns will cut deeply into programming this
week. Last year; the Memorial holiday slashed output-by 35%. :

much talk about

this
to

the automotive industry the past week United

senger.car production held steady at an
"Ward's Automotive Reports" disclosed on

financial

The

American

operating
capacity

rate
for

the

Iron

Steel

and

Institute

steel

companies

will

week

beginning

May

announced

average

1958,

26,

1,526,000 tons of ingot and steel castings (based
production tor 1947-49)
of

compared with

capacity, and 1,523,000 tons

week

that

the

*95.0%

of steel
equivalent to

on average

weekly

actual rate of *94.8%

ago.

Output for the week beginning May 26, 1958 is equal to about

56.5% of the utilization

the

Jan.

1958

annual

capacity

Volume

187

Number

5746

The Commercial and Financial Chronicle

(2425)

140,742,570 net tons compared with actual production of 56.4% the
week before.'

'Ay-J

7: j

■■

For the like week

duction 1,289,000 tons.

month ago the rate

*Index of production
for

year

placed at 2,252,000 tons,

was

ago,

was

*80.2% and

pro¬

the actual weekly production

140,2%.

is based

weekly production

electric

For

the week ended

May 24,

1958, output increased by 59,-

000,000 kwh. above that of the previous week, but was 258,000,000
kwh. under that of the comparable 1957 week, and increased

Loadings Rose 4.8% Above Previous Week Rut
of revenue freight for the week ended May 17,
25,561 cars or 4.8% above the preceding week.'
:
.7
,

Loadings for the week ended May 17, 1958, totaled 560,765
cars, a

decrease of 161,379

cars

1957

week, and a decrease of
corresponding week in 1956.

Automotive Output

87,407

28%

below

the

Held Steady the Past Week

output totaled 86,032 units and compared with
in the previous week. The past week's produc¬
and trucks amounted to

ears

104,175 units, or an inprevious week s output,

sluggish and prices slipped below those
International news reports noticeably

boosted interest in cocoa and futures prices rose
appreciably.
cocoa fell sharply in New York from
151,136
bags a week ago Friday to 146,701 at the end of the past week. A
slight rise in orders for raw sugar helped boost futures prices

Warehouse stocks of

above

that

the

car

output decreased below that of the previous

by 1,375 units while truck output advanced by 1,388 vehicles
during the week. In the corresponding week last year 127,428 cars

23,407

a year

trucks made
the previous

ago.

Canadian output last week totaled 6,971 cars and 1,065 trucks.
the

previous week Dominion plants built 8,469
and for the comparable 1957 week 6,217

trucks

trucks.

cars

and 1,367
1,601

and

cars

;

Lumber Shipments Increased 2.4% Above Output
Week Ended May 17, 1958

•

steers

Reports

were

those

year ago.

the

improved weather conditions in many growingdiscouraged cotton buying last week, but prices
a week earlier.
Exports of United
States cotton for the period ended on May
20, were estimated by
the New York Cotton Exchange Service Bureau at
133,000 bales
compared with 115,000 bales in the prior week and 176,000 bales
in the similar 1957 week.' Exports for the season
through May 13,
were
estimated at 4,621,000 bales compared with
6,286,000 bales
during the comparable period last season.
somewhat

areas
were

sustained close to those of

Trade Volume
Despite

mills in the week ended
production, according to the

May 17, 1958, were 2.4% above
National Lumber Trade Barometer. In the

same

period

new

orders

above production. Unfilled orders amounted to 35%
Production was 3.7% above; shipments 3.3% below and

5.7%

of stocks.

orders

new

0.3% below the previous week and 4.7% below

were

the like week in 1957.

Business Failures Pointed Higher in Latest Week
Commercial
week ended

industrial

and

failures

edged up

to 337 in

the

May 22 from 327 in the preceding week, Dun & Brad-

street, Inc., reports. Casualties were moderately higher than a
year ago when 309 occurred and exceeded considerably the 273
in 1956.
Continuing above the prewar level, failures were 11%
more

numerous

299 from
290 last week and 263 a year ago.
While a slight increase also
occurred among small failures, those under $5,000, edged to 38
from 37, but they did not equal the 46 of this size reported in 1957.
Twenty-five of the failing businesses had liabilities in excess of
$100,000 as against 34 in the preceding week.
Wholesale Food Price Index Registered Fractional Gains

weather

and

some

The Dun & Bradstreet wholesale food

price index rose 0.5%

$6.65 on May 20 from $6.62 a week ago.
9.2% above the $6.09 registered a year ago.

the sum total of the price per pound of
chief function is

foodstuffs and meats in general use and its

show the general trend

of food prices at the wholesale level.

Wholesale Commodity Price Index
The Past Week
Price
and

cocoa

level

last

compiled
280.05
date

increases

resulted in
week.

Dun

The

Edged Upward

lard, some grains, livestock, steel scrap,
slight rise in the general commodity price
daily wholesale commodity price index,

up to 280.58 from
It remained below the 287.33 of the similar

& Bradstreet, Inc., edged

week earlier.

year ago.

this

the
week, but regained the lost ground and moved ahead at the end
of the period.
Corn prices advanced as a result of the new sub¬
sidy program shifting exports from government surplus to com¬
grain trading and futures prices fell at the beginning of

Although transactions lagged, wheat prices were

week ended

steady dur¬

There was a slight rise in rye futures prices as

buying improved.

women's

Furniture

stores

reported further gains in sales of outdoor
tables and chairs, but volume in upholstered lines and dinette sets
slackened. Increased buying of air conditioners and refrigerators
held overall aopliance volume close to that of the prior week.
Interest in floor coverings was sustained at a high level, but

purchases of draperies and linens slipped, despite extensive "White
Sales" promotions.

While house- 1
frozen vegeta¬
bles, sales of frozen juice concentrates, butter, cheese and poultry
There

was

slight dip in food sales last week.

wives stepped up their buying of canned goods and

Retailers in Chicago and Kansas City

reported the most con¬
in women's apparel, while volume
fell most in New York and Philadelphia.

siderable gains from

last

the

Whiting.
to the Burnett

came

office

Toronto

account

1954.

execu--

1956,

transferred to the Chicago
he has worked on a

was

and

the States.

Before first

joining the Burnett

agency, Mr. Sinclair was a mem¬
ber of the Unilever International
Executive Training Program and
was

brand manager with Lever

Brothers in Canada
He worked

and England.

various

^products—

tea,

soup, and
Frostee—and
Good Luck Margarine.

for

Emil J. Pikich Joins

in the
compared with

Soybeans inspected for overseas exports

May 9 amounted to 541,868 bushels

606,718 a week earlier and 1,122,651 in the

Pacific Coast Sees.
(Special to The Financial Chronicle)

SAN
J.

FRANCISCO, Calif.—Emil

Pikich

has

become

associated

with Pacific Coast Securities Com¬

240 Montgomery Street. He
formerly an officer of Carl W.
& Co., Inc., and in the
past

pany,
was

Stern

local

trading

for

manager

William R. Staata & Co.

Cowen & Co. to Admit
J. H.

Billings to Firm

Cowen
New

York

New

Co., 54 Pine Street,
City, members of the

York

Stock

Exchange,

June 5 will admit Joseph H. Bill¬
ings to partnership in the firm.
Mr. Billings
is manager of the
the

over

counter

stock

trading

department.

Three With Dean Witter
CSpecial to The Financial Chronicle)

MODESTO, Cal.—John D. Gar¬
rett, Clay D. Hatch and Graham
W. Lightner have become associ¬
ated

with

Dean

1021 J Street.

All

Witter
were

&
Co.,
previously

with Hooker & Fay.

comparable week last

Ernest Kahn Appointed

By Bache & Co.

year

Bache

Apparel wholesalers reported a noticeable decline in orders
for women's summer dresses, sportswear and beachwear the past

New

York

New

week and volume lagged

Co., 36 Wall Street,
City, members of the

York

nounce

Some early openings
stimulated interest in women's fall clothing, but scattered reports
that

and

behind

a year ago.

retailers are reducing their budgets for fall
last year.
Bookings in men's tropical suits
sportswear were sustained close to those of the prior week.

Overall

many

below

trading in major textile markets equalled that of

The buying of

carpet wool improved in Boston and
Philadelphia and sales of woolens and worsteds were steady.
At
the

beginning of the week transactions in cotton gray goods ad¬
vanced considerably, but slackened at the end of the period.
A
substantial gain in purchases of wide industrial fabrics occurred
during the week. New England dyers and finishers reported no
change in incoming orders.
Department store sales on a country-wide basis as taken from
the Federal Reserve Board's index for the week ended May 17,
1958, decreased 2% below the like period last year. In the pre¬
ceding week, May 10, 1958, a decrease of 4% was reported. For
the four weeks ended May 17, 1958, a decrease of 2% was re¬
ported.
3%

was

Retail

about

ager

trade

sales volume

New York

City the past week

improvement over that of the previous week and closed

even

to 4% higher than a year ago,

Special promotions, lower prices as a

trade observers report.
result of the lifting of

"fair trade" protection, and cool weather, all played their part in
the week's good showing.

1958 declined 4%

For the four weeks ended

was

In the

reported.

May 17, 1958 a decline of 1%

was

re¬

an¬

of the firm's Foreign Depart¬

A native of

has

been

Germany, Mr. Kahn

with

the

firm

over

during which time he has

years,

served

exclusively in the Foreign
Department operations.

With Inv. Service
CSpeclal to The Financial Chronicle)

DENVER, Colo.—Albert T. Fis¬
cher, Floyd R. Pettigrew and A.
Keith
the

Reed

staff

have

been

added

Investment

Service

Co., First National Bank Building.

With Liberty Sees.
(Special to The Financial Chronicle)

DENVER, Colo.—John D. Ells¬
Charles P. Goldsmith and
Ernest A. Ragland, Jr., have be¬
come
affiliated with Liberty In¬
vestment
Corporation,
Denham
Building.
.

worth,

Sills Adds to Staff

the weekly period ended May 17,

below that of the like period last year.

Exchange,

ment.

According to the Federal Reserve Board's index, department

preceding week, May 10, 1958, a decrease of 3%

Stock

the appointment of Ernest
to become- Assistant Man¬

Kahn

For the period Jan. 1, 1958 to May 17, 1958 a decrease of
recorded below that of 1957.

store sales in New York City for

mercial channels.

ing the week.

sales

apparel were close to those of a
year ago, with interest centering primarily in coats, suits and
sportswear. While purchases of women's Summer suits, and chil¬
dren's clothing showed some strength, the call for fashion acces¬
sories was sluggish.

showed

Following reports of government estimates of large crops
year,

West South Central —4 to 0; and Middle Atlantic states —5 to —1%.

week earlier.

cocoa,

The index represents

Wednesday of last week was from 3% below to 1% higher than
a year ago,-spot
estimates collected by Dun & Bradstreet, Inc.,
show. Regional estimates varied from the comparable 1957 levels
by the following percentages: Pacific Coast states —1 to +3%;
West North Central, Edfet; South Central, and Mountain —2 to
+2;
New England —3 to. +1; East North Central, South Atlantic and

The present figure is

Up in price last week were rye, corn, wheat, flour, cottonseed
beef and steers. Lower in price were barley, potatoes,
oats, lard and coffee.

tive

was

The total dollar volume of retail trade in the period ended on

merchandise

raw

and Howard E.

son

sales

reveal.

indicate

The Past Week

decreased.

than the toll of 303 in 1939.

Casualties with liabilities of $5,000 or more rose to

oil,

Vice-Presidents

Canada company, are E. W. Hud¬

Registered Slight Declines in Past Week

warmer

Over-all

Lumber shipments of 477 reporting

were

also

are

variety of accounts while living in

sharply below that of

was

Although pur¬
prior week, prices
Sheep receipts rose during the week, but lamb
futures prices were unchanged.
Following the rising trend in hog
prices, lard futures prices advanced noticeably.
of

reports

Last week the agency reported there were 18,143
in the United States. This compared with 16,755 in

The other members of the
Oper¬
ating Committee of Leo Burnett
Company of Canada, Ltd., who

organization

dealers reported a moderate rise in sales of new
passenger cars,
but volume was again noticeably below last
year, scattered

Last week's

week and

Company of Canada, Ltd., Toronto.

Although increased receipts in Chicago resulted in a substan¬
tial decline in hog prices at the
beginning of the week, increased
trading at the end of the week raised prices over those of the
prior week. The salable supply of cattle rose slightly from a week

and 23,407 trucks were assembled.

units

Company, Inc., has
Vice-President

Mr. Sinclair

week

crease

elected

and
Director and member of the
Oper¬
ating Committee of Leo Burnett

somewhat.

promotions, retail
trade slipped slightly last week and was fractionally below that
of the similar period last year. Declines from the
prior week in
purchases of appliances, housewares and men's apparel offset
increases in women's apparel and outdoor furniture. Automobile

states "Ward's."

;

was

week.

been

car

(revised)

tion total of
..

according to "Ward's Automotive Reports," remained fairly steady
with truck output somewhat higher.
Last week's

cars,

Passenger car production for the week ended May 23, 1958,

:
-

22.3% below the corresponding

218,232

buying

preceding

Leo Burnett

announced that E. M. Sinclair has

climbed somewhat.

Loadings
were

the

chases

Were 22.3% Below Like 1957 Period
1958,

Of Leo Burnett

earlier, but

by 389,000,000 kwh. above that of the week ended May 26, 1956.

Car

While the buying of rice slackened during the
week, prices
held unchanged.
The expectation that new crop prices will be

Coffee

distributed by the electric
light and power industry for the week ended Saturday, May 24,
1958, was estimated at 11,316,000,000 kwh., according to the Edison
Electric Institute.
Output reversed its downward trend of the
preceding week.
energy

E. M. Sinclair V.-P.

season

lower will probably hold prices at current levels for the next few
weeks according to many wholesalers.

Electric Output Showed Improvement for the
Latest Week
amount

fractional dip in soybean

53,900,000 bushels in grain equivalent so far this
compared with 41,400,000 in the same period last season.

1947-1949.

The

totaled

average

Chicago wholesalers reported

year.

futures prices.
'
.
'
J
Increased buying of Spring wheat bakery flour helped boost
flour prices the past week. Commercial sales of flour for
export

(Special to The Financial Chrontcle)

MIAMI, Fla.—Malcolm J. Boraks,
Hugh
P.
Brink, Louis
Brown,
Gregory, Winston F. Nees

Ray
and

Richard

R. Stimer have been

ported. For the period Jan. 1, 1958 to May 17, 1958 no change was

added

registered from that of the corresponding period in 1957.

Ingraham Building.

the staff of Sills

Oo,,

The Commercial and Financial Chronicle

(2426)

Thursday, May 29, 1958

if INDICATES

Securities

Now

^ Ace Telephone Association, Houston, Minn.
May 19 (letter of notification) 1,200 shares of common
stock to be offered to telephone subscribers of the com¬
pany.

Price—At par ($2 per share). Proceeds—For cap¬
Underwriter—None.

ital investment purposes.

American-Caribbean

Oil

(N.

Co.

(par 200).

Proceeds

supplied by amendment.

To
Un¬

—

discharge current liabilities and to drill ten wells.
derwriters—To be named by amendment.
American

Durox Corp.,

Englewood, Colo.
May 1 filed 2,500,000 shares of common stock (par $1).
Price—$2 per share. Proceeds—For construction of new
plant and establishment of the business at Tampa, Fla.,
including payment of the balance due on a plant site.
Underwriter—I. A. I. Securities Corp., 3385 S. Bannock
Street, Englewood, Colo.
Y

Registration

Builders Loans Inc.

27 (letter of notification) 40,000 shares of 17J/2C
preferred stock (par $1). Price—$2.50 per share. Pro¬
ceeds — To selling stockholder. Office — Los Angeles,

Underwriter—Daniel D. Weston & Co., Inc., Bev¬

Calif.

;

American Mutual Investment Co., Inc.

derwriter—None.

^ Central Illinois Light Co.(6/24)

Anderson Electric Corp.
23 (letter of notification)

Dec.

14,700 shares of class B

stock

(par .$1). Price—$12 per share. Proceeds
—To go 1o selling stockholders.
Office —700 N. 44tb
Street, Birmingham, Ala. Underwriters — Cruttenden
Podesta & Co., Chicago, 111.; and Odess, Martin & Iierzberg, Inc., Birmingham, Ala.
common

Anita Cobre U. S. A., inc., Plioenix, Ariz.
Sept. 30 filed 85,000 shares of common stock. Price—At
par ($3.75 per share). Proceeds—For investment in subjidiary and working capital. Underwriter—Selected Se¬

(6/18)

May 28 filed 240,000 shares of
stock, series A (par $50). Price

—

amendment. Proceeds—For

Webster

Securities

Chase Fund of Boston

preferred
supplied by
construction purposes and for
be

payment of loans incurred for construction.
ers—The First Boston Corp. and Blyth &
of New York.

Underwrit¬

Co., Inc., both

common

stock

held.

Price—At

—None.

'■

42,000 shares of stock to

consisting of

•/

the

^Asotin Telephone Co., Asotin, Wash.
May 20 (letter of notification) 500 shares of 5%%

cumu¬

lative preferred stock. Price—At par ($50 per share).
Proceeds—For construction of lines and increase of
plant
necessary to extend the service. Underwriter—None.
Bankers

Fidelity Life Insurance Co.

Feb. 28 filed 258,740 shares of

common

stock

(par $1).

of which

125,000 shares are to be offered publicly and
133,740 shares to employees pursuant to stock purchase
options. Price—To public, $6 per share. Proceeds—Foj
expansion

and

lanta, Ga.

Underwriter—None.

other corporate

purposes.

Office

—

At¬

Management Corp. (6/13)
10 filed 400,000 shares of common stock
(par 25
cents.) Price—$1 per share.
Proceeds—To reduce out¬
standing indebtedness and for working capital. OfficeHouston, Texas. Underwriter
McDonald, Holman &
—

Co., Inc., New York.
*

Bankers

Southern, Inc.

April 14 filed 8,934 shares of common stock. Price—At
par ($100 per share). | Proceeds—For
general corporate
Underwriter

purposes.

—

Bankers

Bond

ville, Ky.

Co.,

Louis¬

Proceeds—For

loans, expansion

purposes.
Underwriter—Hooker
Calif.
Offering —
of

re¬

and
&

Indefinitely

means

offered

share.

per

Natural

general corporate
Fay. San Francisco

postponed.

Alternate

general corporate purposes. Office—1182 Broad¬
New York, N. Y. Underwriter—B. Fennekohl & Co.,

Dec*

construct refinery. Underwriter—Lehman
York. Offering—Indefinite.

Brothers, New

Community Public Service Co. (6/17)
15 filed $3,000,000 sinking fund debentures
Proceeds—To

due

bank loans and for
construction program.
Underwriter—To be determined
by competitive bidding.
Probable bidders: Hals e y,
Stuart
Weld
up

&
&

Co.
Co.

repay

Inc.; Kidder, Peabody & Co. and White,
(jointly). Bids—Expected to be received

a.m.

(EDT)

June

Broad

Street,

York, N. Y.

Chicago and Mid America offers

abundant prospects for
1,400,000 stockholders with

your

securities. Here

than $20 billion invested in

Your

most

securities is

are

over

you

publicly held corporations.

effective way to interest these investors in
your
to advertise in the

Chicago Tribune. The Tribune

places your message before both professional buyers and the
general public. Ask your Tribune representative how

you can

increase your

sales in this riejOnarket.

fflljijotjgpot Oft
THI

WORIO'S

CRCATSSf

N(W$PAICH

bonds, series O, due June 1, 1988.
bank

loans

and

for

Proceeds—To retire

construction

program.

Underwriter—TPo be determined by
competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Morgan
Stanley & Co.; The First Boston Corp. Bids—To be re¬
ceived by company up to 11 a.m
.(EDT) on June
Room 1628, 4 Irving Place, New
York, N. Y. .

^Continental Air Lines, Inc. (6/16-17)
26 filed $12,000,000 of convertible subordinated
debentures due June 1, 1973. Price—To be supplied
by
May

amendment.

Proceeds—To finance expanded operations

resulting from additional routes and services, and up to
$1,750,000 will be used to repay short-term indebtedness
due

before Aug.

(Aircraft) Ltd.
York.

due

1988.

bonds due

Proceeds—To

refund $15,000,000
bank loans and for
Underwriter—To be determined

1987 and to repay

program.

and

Blyth

Co.

Inc.

(jointly);

Merrill

(jointly).

-Bids— To be received up to 11:30 a.m.
June 17 at 600 Market St., Wilmington 99, Del.

—4515

Woodstock, Portland, Ore.

None.

Underwriter^—
Y

„

Dixon Chemical &

Research, Inc.

Dec. 24 filed 165,625 shares of common stock
be

offered

the

rate

for subscription

Price—To

one

new

supplied

expansion^ and

general

for

(par $1) ,to
stockholders at

common

each

four

amendment.

corporate

.Office

purposes.'

Clifton, N.

Offering—Indefinitely postponed.
be arranged. Y
^ "
Y

nancing

Underwriter—P.

held.

Proceeds—For

New York.

Brooks

—

Co., Inc.,
Other fi¬

may

Domestic Finance Group Inc. Y
April 3 (letter of notification) 30,000 shares of 70-ceht
cumulative preferred stock, series A. Price—At
par

per

share).

Proceeds—For

general

($10

corporate purposes.

Office—112A North Green

St., P. O. Box 3467, Greens¬
boro, N. C. Underwriters—United Securities Co., Greens¬
boro, N. C. and McCarley & Co., Asheville, N. C.
Dresser

Industries, Inc.

common stock <par 500)
being offered in exchange for outstanding common sjtock
of the Elgen Corp. on the basis of one share of Dresser

Industries

common .for
3.4 shares of Elgen's common.
exchanges will be made unless the exchange offer
is accepted by the holders of at least 80% of the out¬
standing Elgen common, and Dresser will not be obli¬

gated

to consummate any exchanges unless the offer
accepted by the holders of at least 95% of the out¬
standing Elgen common. The offer will expire on June
17, unless extended. Underwriter—None. \*
>
Elsin Electronics Corp. r
May 1 (letter of notification) 265,266 shares of common
stock (par two cents).
Price—$1.12% per share. Pro¬
ceeds—To repay bank loan; to
purchase new equipment
and for working capital. Office—617-33
Brooklyn Ave.,
Brooklyn 3, N. Y. Underwriter—Lee Co., New York, N. Y.

Ethodont

(6/3)

refunding mortgage

short-term

bonds

Offering—Expected early in June.

Consolidated Edison Co. of N. Y., Inc.
March 3 filed $50,000,000 of first and

RICH IN PROSPECTS!

;

May

1978.

.wv-v/Y

• Dieringer's Properties, Inc. *
May 19 (letter of notification) 2,500 shares of 7% cumu¬
lative preferred non-voting stock.
Price—At par ($100
per share). Proceeds—To invest in new property. Office

•

filed

■

Power &

ware

Feb. 28 filed 128,347 shares of

Oct. 1, 1968 and 3,000,000 shares of common stock to be
offered in units as follows: $1,000 of bonds and 48 shares
of stock and $100 of debentures and nine
shares of stock
Price—To be supplied by amendment, Proceeds — To

New

financing studied.

$25,000,000 -of first mortgage bonds due
Sept. 1, 1968, $20,000,00 of subordinated debentures due

June

Proceeds—For exploration
other corporate purposes. I'nder-

■

Gas

(John), Inc. v
April 24 (letter of notification) 150,000 shares of com¬
mon stock (par 25 cents).
Price—$1 per share: Proceeds

Street, New York, N. Y.

market.

the business of writing life insurance and
annuity
policies./ Underwriter—DAC Securities Corp., Denver,
Colo.
' Y .'.Y
Y
Y
Y '
;
•

(unspecified) of its common stock,
at an aggregate price of $1,215,000
plus interest, if any, /
on the notes. Underwriter—Harrison &
Co., Philadelphia,
Pa.
'
*,
Y,Y
= V*'-v;:.;.-Y:
'YY":; \

Commerce Oil Refining Corp.

Price—At

riter Y-IIcrrin Co.. Seal t ie. Wash.

units

and additional shares

205 E. 85th

(par one-half cent) in each of 24
Price —To be supplied by amend¬
capital expenditures, exploration
costs and other corporate purposes. Underwriter—None.

companies.

Co., a sub¬
sidiary, its $350,000 of 25-year 6% convertible subordin¬
ated notes, $245,000 of its 25-year subordinated
notes,

way,

767,838 units of voting trust certificates,
representing the ownership of one share

stock

Denver Acceptance Corp., Denver, Colo;
May 19 filed 1,000,000 shares of common stock (par $1).
Prices—$2 per share. Proceeds—To engage, through one
or more subsidiary companies to be formed or
acquired,

Proceeds—To

Cobb

filed

Proceeds—For

(EDT)

$100 debenture and six shares of stock;
72,030 shares to be offered separately.

remaining
Price—$130 per unit; and $6
purchase from Eastern Shore

Bishop Oil Co., San Francisco, Calif.

Feb. 27 filed 112,565 shares of common
stock (par $2) to
be offered for
subscription by common stockholders
on the basis of one new share
for each five shares held
Price—To be supplied by amendment.
duction of bank

—For

t Bankers

-Feb.

common

Boston. Corp.

if Chesapeake Utilities Corp., Dover, Del.
May 26 filed $700,000 of 6% debentures due 1983 and
114,030 shares of common stock (par $2.50), the deben¬
and

Co.

Pro¬

par.

repay bank loans, for addition to plant and
working capital. Underwriter—Drexel & Co., Phila¬
delphia, Pa.
-. s• *
:

tures

Lynch, Pierce, Fenner & Smith and Kidder. Peabody &

for

May 5 filed 55,774 shares of common stock (par $5) to
be offered for subscription by stockholders of tecord
May 28,1958, at the rate of one additional share for each
10 shares then held; rights to expire on June 17. Price
—$15 per share. Proceeds—For property additions and
improvements. Office—Fayetteville, Ark. Underwriter

St. '

& Co.

ceeds—To

Arkansas Western Gas Co.

Corp.,

Y.¬

by competitive bidding. Probable bidders: Halsey, Stuart
Inc.; White, Weld & Co. and Shields & Co. (joint¬
ly); Eastman Dillon, Union Securities & Co.; The First

Corp.

convertible debentures to be offered for subscription -by
stockholders on the basis of $100 of debentures for each
of

March

each certificate

trust

Instrument Corp., Shadyside, Md.
April 30 (letter of notification) $275,000 of 5% 10-year

Sales-

Havana, Cuba

construction

Chesapeake

Research

Cuban-Venezuelan Oil Voting Trusts, /

(6/3)

Counselors

—

Robert H. Green is President.

Light Co. (6/17). Y
May 21 filed $25,000,000 oi first mortgage and collateral

cumulative

Underwriter

Louis.

Dela

Bids—Expected to be received up to 11 a.m.
June 24 at 300 Park Ave., New York, ,N. Y.

cent).

April 24 filed 1,000,000 shares of capital stock (par $1).
Price—$10 per share. Proceeds—For investment. Under¬
writer—Shearson, Hammill & Co., New York.

curities, Inc., Phoenix, Ariz.
^-Arizona Public Service Co.

Stone' &

Research

Fund, Inc.; St. Louis, Mo.
filed 100,000 shares of capital stock,? (par one.
Price—At market.
Proceeds—For investment.

holders.

Underwriter—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.; The
First Boston Corp.; Kidder, Peabody & Co.; Eastman Dil¬
lon, Union Securities & Co.; Merrill Lynch, Pierce; Fen-

(EDT)

Counselors

and drilling oo.qs and

Y-Y•

gram.

(jointly).

Underwriter—Netherlands Securities Co., Inc., 30
Y
Y; , ;
>.

Daybreak Uranium, Inc., Opportunity; Wash.'
29 filed 1,156,774 shares of common'stock
(par 10
cents), of;\vhiv1f 6:50,018/shares are to be offered lor ac¬
count
ol company■'•and •520,774 shares Lor
selling stock¬

May 28 filed $12,000,000 of first mortgage bonds due 1988.

and

share.

per

Proceeds—To repay bank loans and for construction pro¬

Smith

(6/9)

shares of

common stock (par 10
Proceeds—To pay bank
working capital and other corporate pur¬

Price—$2.50

loans and for

Feb.

ISSUE

Stock Exchange

REVISED

Jan.

Proceeds—For general corporate

ner

cents).

ment.

Canada (6/11)
Y YY;aYYYMay 21 tiled voting trust certificates for 400,000 shares
of capital stock (par $1—Canadian). Price—To be related
to the current market prices or quotations on the Ameri¬
can

16 filed 280,000

Cuban
r

immediately prior to such offering.
purposes/ Underwriter
—Paine, Webber, Jackson & Curtis, New York.

—

April

poses.

Campbell Chibougamau Mines Ltd.; ;
March 10 filed 606,667 shares of capital stock (par $1)
of which 506,667 were issued in connection with the ac¬
quisition of all the assets of Yorcan Exploration Ltd
(latter proposes to distribute said shares ratably to its
stockholders of record Dec.. 16, 1957),
The remaining
100,000 shares are to be sold for the account of the Estate
of A. M. Collings Henderson on the American and To¬
ronto Stock Exchanges.
Price—At market. Proceeds—/
To selling stockholders.
Office—Toronto, Canada; Un¬

share. Proceeds—For investment in first trust notes,
tecond trust notes and construction loans. Company may
develop shopping centers and build or purchase office
buildings. Office — 900 Woodward Bldg., Washington,
D. C.
Underwriter
None.
Sheldon Magazine, 1201
Highland Drive, Silver Spring, Md., is President.
per

ITEMS

Broad St., New York.

;

* Canada Southern Petroleum Ltd., Calgary,

Dec. 17 filed 490,000 shares of capital stock. Price—$10.20

Cosmos Industries, Inc.

•

March

erly Hills, Calif.

Y.)

Feb. 28 filed 500,000 shares of common stock
Price—To

ADDITIONS

SINCE
•

15, 1958 to Vickers-Armstrongs
Underwriter — Lehman Brothers, New

Feb.
At

par

expense
•

filed

Laboratories, Berkeley, Calif.
300,000

common

($5 per share). Proceeds—To
during the development period

stock.

cover

Price—

operating

of the corpora-

Expanded S^afe Products, Inc., Denver, Colo.'

Jan. 29 filed 60,000 shares of common stock
(par $1) and
$180,000 of 6% callable unsubordinated unsecured deben¬
ture notes

due 1960-1964 to be offered in units of $600
of notes and 200 shares of stock.
Price—$l ,000 per unit.
Proceeds—For construction of plant,
working

capital and

other

corporate purposes

Co., Albuquerque, N. M.

Underwriter—Minor

Mee

Statement effective May 19.

&
-

Fall River Electric Light Co.
(6/18)
May 16 filed $3,000,000 of first mortgage and collateral
trust bonds due April 1, 1988.
Proceeds—Together with
other funds, to purchase at
par $1,110,000 of debenture
bonds and $950,000 par value of common stock of
Montaup Electric Co., and to repay $2,050,000 of short-term

The Commercial and Financial Chronicle

Number 5746

187

Volume

Underwriter

bank loans.

First Backers

To be determined by com¬

—

(2427)

Co., Inc., Clifton, N. J."
$1,000,000 of 12% notes, payable

petitive bidding. Probable bidders: Halsey, Stuart & Co.

April

Inc.; Estabrook & Co; and Stone Webster Securities Corp.

months after date

(jointly). Bids—Expected to be received up to 11 a.m.
(EDT) on June 18.

tiples

Famous

Virginia Foods Corp.
(letter of notification) 19,500 shares of common
stock (par $5) and 390 common stock purchase warrants

Jan. 30

offered

units

stock

and

Forest

motion

Proceeds

For

—

and nther *or-

expansion

tional

Underwriter—

Office—Richmond, Va.

porate purposes.
None.

and

filed

named

amendment.

Sol

Gold¬

150,000 shares of capital stock (par 10
per share. Proceeds—For sales pro

of company's products, working
capital, addi¬
inventory and accounts receivable, for research

development and for other general corporate

pur

NEW ISSUE CALENDAR
June 2
Household Gas

June

Debentures
Inc.)

Investing Co.,

Valley

(Mohawk
*

(6.

Fuller

....Common

(Charles Plohn

Clayton Securities Corp.)

and

&-Co.

(Ira

June

200,000 shares

June 3

Arizona

(Tuesday)

$50,000,000

EST)

Ltd
t

Mountain Fuel

Petrochemicals of Canada

Jefferson Lake

Read & Co. Inc.)

(Dillon,

(Bids

$299,970

United Gas

White, Weld & Co.) 23,500

and

(Monday)

Bonds

PDT)

a.m.

$20,000,000

None.
H. & B. American Machine Co., Inc.
May 9 filed $1,024,944 of 5% collateral notes, due June
15, 1968 (subordinated) and 256,236 shares of common
stock (par 10 cents) to be offered together with cash in
exchange for the outstanding common stock (par $20)
of General Trading Co. on the basis of (a) three sh£u*es
of American Machine common (b) $12 principal amount
of 5% notes, and (c) $5 in cash, for each^of the 85,412
outstanding shares of General Trading common stopk.
The offer is conditioned, among other things, uponn Its
acceptance by holders of not less than 68,330 shares of
the General Trading stock. Office—Culver City, Calif.
Dealer-Manager — Kalman & Co., Inc., St/ Paul, and
Minneapolis, Minn.

(Wednesday)
...Debentures

noon

EDT)

$40,000,000

June 30

(Monday)

(Bids

a.m.

EDT)

Bonds

$10,000,000

(Tuesday)

July 1

Chicago, Burlington & Quincy RR—.-Eq. Tr. Ctfs.
(Bids

Securities Corp )

$300,000

$4,650,000

Bonds

11:30

(Bids

a.m.

EDT)

$25,000,000

Potomac Plastic Co

Bonds

Power Co

to be invited)

Florida Power Corp

Common

Glassheat Corp.
New England

Bonds

$6,000,000

Debentures

Cosmos Industries, Inc
Common
(Netherland Securities Co., Inc.) $700,000

Anthony

EDT)

Orange & Rockland Utilities, Inc

and Goldman Sachs & Co.) $50,000,000

June 9

(James

Corp

...„r.Common

Owens-Illinois Glass Co
(Lazard Freres & Co.

Guardian Insurance Corp., Baltimore, Md.
Aug. 16 filed 300,000 shares of common stock, of whtcb
200,000 shares are to be publicly offered and the remain¬
ing 100,000 shares reserved for issuance upon exercise
of warrants which are to be sold at 25 cents per warrant
to organizers, incorporators, management, and/or direc¬
tors. Price—$10 per share. Proceeds—For working cap¬
ital and general corporate purposes.
Underwriter —

Inc.)

Preferred

Evans & Co.;

Clement

Co.;

Co.,

(Tuesday)

a.m.

June 25

$25,000,000

Florida Public Utilities Co
'

Pacific Power & Light Co

(Bids

Common
Blytli

Debs. & Stock

if Hawaiian Telephone

(Whitney & Co.) $115,000

Southern Union Gas Co.—
Preferred
(Snow, Sweeney & Co., Inc., and A. C. Allyn & Co., Inc.)
$3,000,000

Laclede Gas Co
(Lehman Brothers

Preferred
and Merrill Lynch,

'Tuesday)

June

(Tuesday)

July 8

Maine

(First

Rhodesia

(Dillon,

(Bids

(Federation of)—Bonds

—Bonds

(Bids

EDT)

Bonds

$30,000,000

to be

invited)

offered to the

$10,000,000

Searle

EDT)

a.m.

Common

(G. D.) & Co
(Smith, Barney & Co.)

Talcott
(F.

250,000 shares

and White, Weld & Co.)

Bankers Management
(McDonald,

Edison
(The

Inc.)

Boston

Lines,

(Lehman

Industro

Transistor
<8

(Bids

Equip: Trust Ctfs.

invited)

New England

Oklahoma Gas &
(Bids

150.000

(Thursday)

(Bids

Com.

to be

Bonds
invited)

August 26

-(Bids to be

Hospital Corp..Common

EDT) 815,000,000

Bonds

stock to be offered to stockholders

Lauderdale, Fla.

Underwriter—None. Statement
50,000 shares of common

Montana

Power

$40,000,000

Co—

Household Gas

Service, Inc. (6/2)
of notification) $60,000 6% convertible
debentures dated June 1, 1958 and due June 1. 1973.
Price—100% plus accrued interest (in denominations of
$1,000 and $500). Proceeds—For repayment of debt and
working capital. Office—Clinton, N. Y. UnderwriterMohawk Valley Investing Co., Inc., Utica, N. Y.
May

(letter

it Idaho Mining & Milling, Inc.
May 19 (letter of notification) 15,000,000 shares of non¬
assessable common stock. Price—At par (two cents per
share). Proceeds — For mining and milling expenses.
16th

Ave., Lewiston, Idaho.

Underwriter—

None.

Illinois Bell Telephone Co.
May 9 filed 870,792 shares of common capital stock to
be offered for subscription by stockholders of record

(Thursday)

(Bids to be invited) $20,000,000

stock expected.

Office—504

Telegraph Co..JDebens.

Invited)

September 4

$300,000

$17,000,000

(Tuesday)

New England Telephone &

underwriter> 735,245 shares

Co.)

Electric Co
11 a.m.

Electric

812,000,000

Telephone & Telegraph Co

(Offering to stockholders—no

Tampa

Common

Go.)

Northern Virginia Doctors

Debentures

Corp.

(Whitney

$2,340,000

$400,000

Inc

Brothers)

Fuller

Debentures

(Wednesday)

July 16

July 17
Air

$25,000,000

'Monday)

June 16

Continental

Corp.)

(Bids to be invited) $30,000,000

Common
Co.,

First

Preferred

Norfolk & Western Ry

Corp

Holman

—Fort

(Thursday)

Southern Natural Gas Co..

100,000 shares

(Friday)

June 13

$60,000,000

public at $5 per share and 116,366 shares

common

it $6 per share at the rate of two new shares for each
Ive shares held
Proceeds- For working capital
Offleo
withdrawn. New filing covering

Boston

Common

(James), Inc.-

Eberstadt & Co.

to be invited)

July 10

Bonds

$50,000,000

Bonds
-

Curtis) 400,000 shares

(Paine, Webber, Jackson <fc

Niagara Mohawk Power Corp
(Bids

Telephone Corp
(Bids

Common

Ltd..

Canada Southern Petroleum

Price—To be sup¬

—

Home Owners Life Insurance Co.

of class B
New York

Wednesday)

June

Proceeds

Nov. 1 filed 50,000 shares of class A common stock to be

Bonds

(Bids

by amendment.

derwriter—None.

Laclede Gas Co

$25,000,000

EDT)

a.m.

July 9 (Wednesday)

Read & Co. Inc.) $10,000,000

Virginia Electric & Power Co.-

Hawaii

For construction of
facilities for the extension and improvement of services,
or to repay bank loans incurred for such purposes. Un¬

plied

■"

Northern States Power Co. (Minn.)

$5,000,000

Corp.)

Nyasaland

and

..Common

Securities Corp

Insurance

share for each five shares then held.

Pierce, Fenner & Smith)

$8,000,000
•V

Life

Co., Honolulu,

May 16 filed 333,672 shares of common stock (par $J0)
to be offered for subscription by common stockholders
of record May 23, 1958, on the basis of one additional

(Bids noon EDT) $10,000,000

Corp. (6/9-13)
(letter of notification) 150,000 shares of class A
stock (par 10 cents). Price—$2 per share. Pro¬
ceeds—For
general corporate purposes.
Office—1 E.
35th Street, New York 16, N. Y.
Underwriter—James
Anthony Securities Corp., 37 Wall St., New York 5, N.3T.

common

(Monday)
by

Feb. 12

Debentures

June 24

B stock

Glassheat

(Thursday)

June 5

(Starkweather

$16,000,000

Corp.)

853,781

(Bids

Transmission Corp

Eastern

Texas

Electric

Common

Inc.)

Boston

Central Illinois Light Co

Inc.

Co., Inc

Securities,

(Ross

(Wednesday)

June 4

First

stockholders—underwritten

Jefferson) $206,105

(Edwin

Tamarac Gas & Oil

(Offering

Preferred

Wilier Color Television System,

$3,000,000

Gas

60,000 shares

invited)

$12,000,000

Bonds

EDT)

a.m.

June 23
Pacific

$300,000

Pennsylvania Power Co..—

and

Common

(McDonald, Holman & Co., Inc.)

(Bids

^.-Preferred

....

Gairdner, Son & Co.,

North American Merchandising

(Wednesday)

Supply Co

(The

v»

--Common

Robert Garrett & Sons;
Ltd.) $3,330,000

&-Weeks;

(Hornblower

(Bids

Bonds,

common

Getty Oil Co., Wilmington, Del.
April 11 filed 2,170,545 shares of common stock (par $4)
being offered in exchange for capital stock (par $5) of
the Mission Development Co., on basis of one share of
Getty stock for each 12 shares of Development stock, or
five shares of Getty for six shares of Development stock.
Offer to expire on June 25 at 3:30 p.m. (EDT).

Common

$5,000,000

Fall River Electric Light Co

Consolidated Edison Co. of N. Y. Inc.
a.m.

Bonds

(Shearson, Hammill & Co.) $10,000,000

Underwriters—None.

Georgia Casualty & Surety Co., Atlanta, Ga.
May 6 filed 450,000 shares of common stock (par $1).
Price—$6 per share. Proceeds — For general corporate
purposes. Underwriter—Buckley Enterprises, Inc.

$3,000,000

Public Service Co._

Co., Denver, Colo.

—None.

(The First Boston Corp. and Blytli & Co., Inc.)

Capital

Chase Fund of Boston—

'Bids

Haupt & Co.)

added

Devices, Inc., Princeton, N. J.
(letter of notification) 40,000 shares of com¬
mon
stock (par $1) to be offered for subscription by
stockholders at the rate of approximately 18.5 shares
for each 100 shares held about April 15; unsubscribed
shares to public. Price—$3.50 per share. Proceeds—For
/expansion, equipment and working capital. Underwriter

EDT) $25,000,000

a.m.

General

Debentures

Missiles-Jets & Automation Fund, Inc

Tel-A-Sign Inc.

EDT)

a.m.

(Bids 11:30

$2,600,000

Co.)

will

March 31

(Tuesday)

Delaware Power & Light Co

Common

Technology Instrument Co
.

(Bids

Common
247,824 shares

(Smith, Barney"& Co. )

Community Public Service Co

$60,000

Co.

Ingecsoll-Rand
/

(Monday)

Service, Inc

balance

(no
(par $1).
Proceeds—To the Attorney General of the United States.
Underwriter—To be determined by competitive bidding.
Probable bidders: Blyth & Co., Inc., and The First Bos¬
ton
Corp.
(jointly); Kuhn, Loeb &
Co.;
Lehman
Brothers, and Glore, Forgan & Co. (jointly). Bids—Had
been scheduled to be received up to 3:45 p.m. (EDT) on
May 13 at Room 654, 101 Indiana Ave., N. W., Washing¬
ton 25, D. C., but bidding has been postponed.

Price—$2.50

determined.
>

cents).

Oil & Gas

par) and 1,537,500 shares of

Laboratories, Inc.

March

the

General Aniline A Film Corp., New York
Jan. 14, 1957 filed 426,988 shares of common A stock

berg is President.

any, will be offered to the public.
Price—$5 per
share to stockholders; and to the public at a price to be

•

drilling and exploration costs.

26 filed 470,000 shares of common stock
(par 29
cents). 'Price—$3 per share. Proceeds—For exploration
work and
working capital.
Office — Portland, Ore

ing, if

and

Office—Fort Pierce, Fla. Underwriter
Co., Inc., of Miami Beach, Fla., on a best

Four Corners

Dec.

Underwriter—To

March 25 filed 400,000 shares of common stock (par $1).
Price—$3 per share. Proceeds—To pay off debts and for

■

....

$1,425,248,

effort basis.

Underwriters

Fluorspar Corp. of America

basis; thereafter the balance remain-

rata

pro

.../

—Atwill

York/N. Y. and Clement A. Evans & Co., Atlanta,

Ga.

Fidelity Bankers Life Insurance Corp.
7 filed 450,000 shares of common stock (par $1)
offered for subscription by holders of outstanding
on

cost

working capital.

White, Weld & Co., both of

New

Offering—Expected early in June.

★ Fort Pierce Port & Terminal Co,
May 23 filed 2,138,500 shares of common stock (par $1).
Price—To be supplied by amendment
Proceeds—To
pay some $174,000 of outstanding indebtedness and to
complete phase one of the port development plan, at a

Underwriter—None.

Beach, Fla.

Office—Brooklyn, N. Y. Underwriters—H. Car*
Co., Denver, Colo.: and Alfred L Powell Co.,

New York.

in mul¬

principal amount. Pro¬
solely for purchase of notes and other

Datura St., West Palm
—Starkweather & Co. and

stock
;

units of $100

roll

—338

March
to

Price—100%

poses.

nine

(6/5)
May 16 (letter of notification) 23,500 shares of common
stock (par $3). Price — To be
supplied by amendment.
Proceeds—To pay bank loans and for construction. Office

York, N. Y. Underwriter—Dumont Securities Corp., New
York, N. Y.
'*t

^Florida Public Utilities Co.

it Federal Commercial Corp.
May 21 (letter of notification) 300,000 shares of common
stock (par 10 cents).
Price—50 cents'per share.- Pro¬
ceeds—To make loans, etc. Office — 80 Wall St., New

Issue

improved properties.

one

Whitney & Co., Inc..

—

thereof.

indebtedness issued in payment for improvements on
homes and secured by mortgages or other liens upon the

Price—$500 per unit.
Proceeds—For equip¬
and working capital.
Office—922 Jefferson St.,

Lynchburg, Va. Underwriter
Washington, D. C.

filed

ceeds—To be used

warrant.

ment

Bonds

Continued

page

£0

The Commercial and Financial Chronicle

(2428)

Continued from page

Missiles-Jets

the rate of one new share for each six
expire on June 30. Minority stock¬
holders own 5.934 shares. Price—At par ($100 per share).
iProreeds—To repay advances from American Telephone
& Telegraph Co., and for property additions and im¬
Mav 29, 1958, at

chares held: rights to

(N. Y.) (6/16-20)
of common stock (par 10
cents). Price—To be related to the market price. Proteecls—For working capital and to enlarge research and
Industro Transistor Corp.
28

Feb.

150,000 shares

filed

development department.

Underwriter —S.D. Fuller &

Co., New York,
Inc., Boston, Mass.

Accounts Fund,

Insured

•

27 filed

May

May 12 filed 5,000 shares of common stock. Price—$5,000
pei" share. Proceeds—For investment. Business—To in¬
vest primarily in share accounts insured by the Federal
Savings and Loan Insurance Corp., in savings and loan
associations throughout the country. Underwriter—None

June

construction program.
by competitive bid¬
ding. Probable bidders: Halsey, Stuart & Co. Inc.; Mor¬
gan Stanley & Co.; The First Boston Corp. Bids—To be
recoived up to 11 a.m. (EDT) on June 11 at Room 1840.
15

Proceeds—

•

May 27 filed $16,000,000 of debentures due 1983. PriceTo be supplied by amendment. Proceeds-^$14,000,000 to
redeem a like amount of bank loans; and the balance for

cents) to be offered in units of a $1,000
debenture and 10 shares of stock, or a $100 debenture
tnd one share of stock.
Price—Par for debenture, plus
stock (par 20

mon

f2 per share for each 10 shares of stock. Proceeds—For
construction of a shopping center and other capital im¬

provements; for retirement of present preferred
working capital, etc. Underwriter—None

shares;,,

tnd for
•

Petrochemicals

Lake

Jefferson

be reserved for purchase by

underwriters

through warrants. Price—$5.50 per share. Proceeds—For
working capital and general corporate purposes; and
to develop company's projects in Canada. Underwriters
—Hornblower & Weeks and Robert Garrett & Sons in
the IT. S.; and

it Jetronic Industries, Inc., Philadelphia, Pa.

and

development and for working capital.

—Mortimer

Burnside

Refining Co. (both of Superior, Wis.), at the rate of six
shares of Murphy stock for each share of Superior Re¬
finery and Lake Superior stock; also in exchange for
outstanding negotiable promissory notes and second '
mortgage notes of Superior Refinery, and for outstand¬

Underwriter
on

best efforts basis.

four

for

of Lake

notes

each

least

95%

the outstanding

Office—118 Cherry Lane, Floral Park, N. Y.
■ ■"
■

Underwrit¬

er—None.
•

/'■'

Insurance

Securities Corp.
(6/10)
1,000,000 shares of capital stock (par $1).
Price—$5 per share. Proceeds—To acquire stock control
of "young, aggressive and expanding life and other in¬

companies and related companies and then to
operate such companies as subsidiaries." Underwriter—
First Maine Corp., Portland. Me.
surance

it Longines-Whittnauer Watch Co.
May 23 filed voting trust certificates for 185,000 shares
of common stock (par $1).
Trustees—M. Fred Cartoun
(Board Chairman), John P, V. Heinmuller (President)

it Mutual Securities Fund of Boston
Price

—

market.

Proceeds

—

For

it National Beryl & Mining Corp., Estes Park, Colo.

May 16 (letter of notification) 2,916,000 shares of com¬
mon stock
(par one cent). Price — 10 cents per share.
Proceeds—For general corporate purposes.

mon

(in $1,000 units); and for

share.

common

stock, $4.50

per

Proceeds—For contractual

obligations, for work¬
purposes.
Busi¬
in the development and
operation of various properties, including shopping cen¬
ters.
Office—Salt Lake City, Utah. Underwriter—J. A.
Hogle & Co., Salt Lake City-, Utah.

ing capital, and other general corporate
—

primarily

engage

Mammoth

Mountain

Inn

May 20 filed S350.000 of 6%
to

debentures

unit.

iand

offered
20

subordinated sinking fund

units

common

consisting

shares.

Price

of $100 of
$200 per

—

Proceeds—For

ing capital.

construction, equipment and work¬
Office—Beverly Hills, Calif. Underwriter—

None,
(

Mayfair Markets
-March

(letter

notification)

5,000 shares of 6%
(par $50) and 5,000 shares
(par $1) to be offered in units of one
'share of preferred and one share of common stock. Price
cumulative

'of

common

—$60
4383

per

preferred stock
stock

unit.

Bandini

Proceeds—For working capital. Office—

Blvd., Los Angeles, Calif.

Underwriter—

None.
it McGravt-Edison

Co., Elgin, III.
May 26 filed 10,000 participations in the company's
Profit
Sharing Plan, together with 450,000 common
shares which may be

(letter of notification) 200,000 shares of com¬
(par $1). Price—$1.50 per share. Proceeds—

For mining expenses.

Underwriter—Johnson & Johnson,

Pittsburgh, Pa.

1977.

due

Price—To be supplied

acquired pursuant thereto.

it Merck & Co., Inc., Rahway, N. J.
May 21 filed 200.000 shares of common

stock (par 1673
cents) to be offered to officers and key employees of the
company, its subsidiaries and affiliates, pursuant to the

company's Stock Option Plan.

it Metropolitan Hotel Corp., Portland, Ore.
May 27 filed $3,000,000 of 4% 25-year sinking fund de¬
bentures due July 1, 1983.
Price—At par.
Proceeds—
For construction program and working capital. Subscrip¬
tion Agent — The
Hockenbury

System, Inc., Portland,

Ore.

stockholders,
Proceeds—
mining, development and exploration costs, and for

$1.75 per share; and to public, $2 per share.
For

working capital and other corporate
writers—Harrison S. Brothers &

both of Salt Lake

purposes.

Under¬

Co., and Whitney & Co.,

City, Utah.

Mineral

Operations, Inc., Tulsa, Okla.
April 14 filed 200,000 shares of common stock. Price—
$2.50 per share. Proceeds—For payment of loans, various
equipment, and a reserve for future operations. Business
—To acquire and operate mining claims and oil and gas
properties. Underwriter—Universal Securities Co., En¬
terprise Building, Tulsa, Okla.
Oklahoma

& Electric

Gas

Co.

(6/16)

first mortgage bonds due
June 1, 1988. Proceeds—For construction program. Un¬
derwriter
To be determined by competitive bidding.
May

filed

$15,000,000

—

bidders:

Probable

Halsey, Stuart & Co. Inc.; Equitable

Securities

Corp.; The First Boston Corp.; Kuhn, Loeb &
Co., Merrill Lynch, Pierce, Fenner & Smith and White,
Weld & Co. (jointly); Harriman Ripley & Co. Inc. and
Eastman Dillon, Union Securities & Co. (jointly). Bids—
To be received up to 11 a.m. (EDT) on June 16 at The
First National City Bank of New York, 55 Wall St.,
York 15, N. Y.

New

O. T. C.
March

Natural Gas Pipeline Co. of America
Nov. 19 filed $40,000,000 of first mortgage pipeline bonds

Enterprises Inc.
(letter of notification)

class

23,200

of com¬

B stock

(par $1). Price—$5 per share. Pro¬
ceeds—For completion of plant plans; land; construc¬
mon

tion and operating expenses.
Pro¬
Office—2502 N. Calvert
Dillon,
St., Baltimore 18, Md. Underwriter—Burnett & Co.,
Read & Co. Inc. and Halsey, Stuart & Co. Inc., both ~
Sparks, Md.
o* isfew York. Offering—Now expected in June.
Owens-Illinois Glass Co. (6/5)

ceeds— To

reduce

loans.

bank

by amendment.

Underwriters

—

May

May 5 (letter of notification) 150,000 shares of common
stock (par one cent). Price—$2 per share. Proceeds—To
pay loan; to acquire fishing tools for leasing; and for
working capital. Office—931 San Jacinto Bldg., Houston,
Tex. Underwriter—T. J. Campbell Investment Co., Inc.,
Houston, Tex.
it New Britain Machine Co.

May 19

(letter of notification) 3,000 shares of common
to be offered to employees. Price—At
market price at date of offering. Proceeds—For working
stock

(par $10)

Office—c'o Ralph S. Howe, President, 674 Lin¬
Road, New Britain, Conn. Underwriter—None.

capital.

Corp.

debentures due 1968 and 70.000 shares of common stock

$5)

stock

NedOW Oil Tool Co.

it M?|na Investment & Development Corp.
May 26 filed 56.000 shares of common stock and $500,000
of 6% convertible debentures. Price—For debentures, at

(par

Underwriter

—Birkenmayer & Co., Denver, Colo.
March 21

000 shares of unsubscribed stock. Price—To

investment.

Co., Inc., Bos¬

ton, Mass.

ness

•

National Manganese Co., Newcastle, Pa.

Life

March 28 filed

par

shares and

May 27 filed 200,000 shares of beneficial interest in the
Fund

Underwriter—Keller Brothers Securities

it Lesnor Maehr Marine Co., Inc.
"May 20 (letter of notification) $24,500 6% debentures
and 49 shares of capital stock (no par). Price—For de¬
bentures, at par (in units of $500 each); of stock, $500
per share.
Proceeds — For general corporate purposes.

Offer is conditional upon its acceptances by

of both companies.

notes

Underwriter—Whitney & Co., Washington.

Oil Inc., Salt Lake City, Utah
April 4 filed 597,640 shares of common stock (par $1)
to be offered for subscription by common stockholders
of record March 24, 1958 at the rate of IV4 new shares
for each share then held. Employees may purchase 50,-

Oil

Superior, at

principal amount

$100

American Merchandising Co.
(6/3)
(letter of notification) 300,000 shares of com¬
(par 25 cents). Price—$1 per share. Proceeds

Murphy Corp., El Dorado, Ark.

promissory

York.

negotiable

common

stock

Church, Va.

May 5 filed 71,958 shares of common stock (par $1) to offered in exchange for outstanding common shares
of Superior Refinery Owners, Inc., and Lake Superior

holders

Co., Inc., New York,

(N. Y.1

ing

Street, New York, N. Y.

Northern Virginia Doctors Hospital Corp. (6/16)
April 4 (letter of notification) 30,000 shares of common
stock (par one cent). Price—$10 per share. Proceeds—
For building fund.
Office — 522 Leesburg Pike, Falls

Investment Trust Fund. Inc.

For

Office—Dallas, Tex. Underwriter
—McDonald, Holman & Co., Inc., New York, N. Y.

Underwriter—The First

1958.

—

determined

—For general purposes.

9, 1957 filed 5,000 units of undivided interests in
Municipal Investment Trust Fund, Series A. Price—At
market. Proceeds—For investment. Sponsor—Ira Haupt

such notes.

May 27 filed 130,000 shares of common stock (par 10
cents). Price—S3.75 per share. Proceeds—For research

May

rate

Gairdner, Son & Co., Ltd. in Canada.

Corp., New York.

Municipal

Ltd.

of Canada,

'/V'V—
May 7 filed 660,000 shares of common stock (par $1), of
which 600.000 shares are to be offered to public, one-half
in the U. S. and the rest in Canada.
The other 60,000
are

Boston

program

& Co., New

(6 3-4) '

construction

(6/18)

Supply Co.

North

May
mon

it Mountain

(no par).
Price—$27 per share.
Proceeds—For
expansion and working capital. Underwriter—None.

purchase of land, construction and working capital.
Underwriter—Southeastern Securities Corp., New York.

Fuel

Broad

—

stock

For

Inc., Washington, D. C.
Julv 30, 1957 filed 810,000.000 of 5!/2-8% sinking fund
debentures due Aug. 1. 1972 and 100,000 shares of com¬

Janaf,

Proceeds

1988.

Nichols, Inc., Exeter, N. H.
May 13 (letter of notification) 11,111 shares of

Inc., Roanoke, Va.

Price—$5 per share.

Underwriter

18 (letter of notification) 60,000 shares of common

(par 40 cents).

Bids—Were to have been received up to 11:30 a.m.

Niagara Mohawk Power Co. (6/11)
May 16 filed $50,000,000 of general mortgage bonds due

general corporate purposes. Office — 1234 Second Ave.,
Akron, Ohio. Underwriter—Kidder, Peabody & Co. Inc.,
New York. Offering—Made yesterday (May 28).

stock

determined by competitive bidding.
Probable
Halsey, Stuart & Co. Inc.; Morgan Stanley &

on May 26 at Room 1600, 140 West St., New York,
Y., but company on May 16 announced plans for this
refinancing have been postponed.

Underwriter—None.

Motel Co. of Roanoke,

Thursday, May 29, 1958

(EDT)

it Mohawk Rubbed Co.
May 14 (letter of notification) 12,244 shares of common
stock (par $1). Price—$24.50 per share.
Proceeds—For

Nov.

Ben H. Hazen is President.

Co.

15,000 shares of common stock. Price—
Proceeds—For working capital and gen¬

eral corporate purposes.

bidders:

Inc.,

it Modern Community Developers,
Princeton, N. J.
$100 per share.

Underwriter—None.

provements.

—To

(6/17)

Inc.

Fund,

Automation

May 8 filed 500.000 shares of capital stock (par $1).
Price—$10 per share. Proceeds—For investment. Under¬
writer—Ira Haupt & Co., New York.

coln

June

New

England Power Co.

(6/9)

maturity;

Union

Dillon,

Securities

Co.

and

Salomon

Bros.

(jointly); Lehman Brothers; Merrill Lynch,
-Pierce, Fenner & Smith; Kidder, Peabody & Co. and
White, Weld & Co. (jointly); Equitable Securities Corp.
and Blair & Co., Inc. (jointly).
Bids—Scheduled to be
reecived up to noon (EDT) on June 9 at 441 Stuart St.,
16. Mass.

Boston
•

New

England Telephone & Telegraph Co. (6/16)
May 16 filed 735,245 shares of common stock to be of¬
fered for subscription by stockholders of record June
11

011

the

basis

one

held; rights to expire

new

for

each five

July 11. American Telephone &
Telegraph Co.owns about 2,547,411 shares (about 69.29%)
of the outstanding stock. Price—At par ($100 per share).
Proceeds—To repay

porate purposes.
New York

advances from parent and for
Underwriter—None.

cor¬

Telephone Co.
May 2 filed $70,000,000 of refunding mortgage bonds,
series K, due May 15, 1991. Proceeds—To refund a like
amount of series J 4 V2 % bonds sold last year. Underwriter

balance

$20,000,0*0 short-term borrowings
be added to working capital.
Sachs

Underwriters—Lazard Freres & Co. and Goldman,
&

Co., both of New York.

it Pacific Gas & Electric Co. (6/23)
May 27 filed 853,781 shares of common stock (par $25)
to be offered for subscription by common stockholders of
record

June

17,

1958

the

rate of

one

new

share for

each 20 shares then

held; rights to expire 011 July 8, 1958.
supplied by amendment. Proceeds—To re¬
bank loans and for construction program. Under¬

Price—To be

writer

Hutzler

filed

in 1956) and all of the

pay
•

May 12 filed $10,000,000 of first mortgage bonds, series
H, due 1988. Proceeds — Together with approximately
$5,000,000 from a common stock issue to New England
Electric System, the parent, to be applied first to pay¬
ment of short term notes and any balance will be used
for capital expenditures or to reimburse the treasury
therefor.
Underwriter—To be determined by competi¬
tive bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
The First Boston Corp.; Kuhn, Loeb & Co., Eastman

$50,00,000 sinking fund debentures due
Proceeds—To retire $15,266,000 of deben¬

1, 1988.

tures of National Container Corp. (merged into company

New

—

Blyth

Co., Inc., San Francisco, Calif., and

York, N. Y.

Pacific Power &

Light Co. (6/24)
$20,000,000 of first mortgage bonds due
Proceeds—Together with other funds, will
be used in carrying forward the company's construction
program through 1958 and in retiring bank borrowings.
Underwriter—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; Lehman
Brothers; Bear, Stearns & Co., and Salomon Brothers &
Hutzler (jointly); Eastman Dillon, Union Securities &
Co. and Kidder. Peabody & Co. (jointly).
Bids—Ex¬
pected to be received up to 9 a.m. (PDT) on June 24.

May

filed

July 1, 1988.

Palestine Economic Corp.,

New York
5% notes, due Oct. 1, 1963
(a) interest-bearing notes
with interest payable at the rate of 5% and at an offer¬
ing price of 100% of principal amount; and (b) capitalappreciation notes, at a discount from maturity value so
as
to yield 5% compounded semi-annually. Proceeds—
March 31

filed $2,000,000 of
in. two types:

offered

For making investments and loans in

companies or en¬
terprises that the corporation is already financially in¬
terested

in,

for other corporate

purposes.

Underwritef

—None.

Paradox Production Corp., Salt Lake City, Utah
April 18 filed 767,818 shares of common stock (par $1),
of which

100,000 shares are to be offered by the company
properties and 3,000 for serv¬
ices; the remaining 664,818 shares are to be offered to
the public. Price—To be supplied by amendment. Proin exchange for oil and gas

Volume

137

Number 5746

.The Commercial and Financial Chronicle

ceeds—To

selling stockholders.
Underwriter—Market
Securities, Inc., Salt Lake City, Utah.

Colo.

Price—At

market.

Proceeds—For

investment.

Under¬

writer—Investors Investments Corp., Pasadena, Calif.

Pecos Valley Land Co., Carlsbad, N. Mex.
13 filed 2,000,000 shares of common stock

March

received

other

hand and

serve,

Union

Gas

share.

expire

Process

share for

July 1, 1958.

beneficiate

Statement effective May 23.

working capital.
Office—27
St., Binghamton, N. Y. Underwriter—None.
Potomac Plastic Co.

Southwest

manganese

Underwriter—

ores.

share.
Chenango

Plan

(7/1

ment

the

for

employees of

the

—

ATalcott

100,000 shares of

inces

general corporate purposes.

Saskatchewan

and

Alberta

and

Canada.

Office

—

Saskatoon,

Canada.

N. Y..

East and Africa.

"-/V

;

and

one

class

—

stock.

(6/10)

May 8 filed $10,000,000 of external loan bonds due May
1, 1973. Price—To be supplied by amendment. Proceeds
—Together with a loan of $15,000,000 from World Bank,
to be used, mainly for capital expenditures, including
railroad development. Underwriter—Dillon, Read & Co.
Inc., New York.

"best efforts" basis.

•

..-V:

;

stock

United Artists Associated Inc., New York

kee, Wis.
• Rockwell-Standard
Corp., Coraopolis, Pa.
April 28 filed 285,600 shares of common stock (par $5)
being offered in exchange for the capital stock of Aero
Design & Engineering Co. in the ratio of 1 5/7 shares of

Rockwell-Standard stock for each share of Aero stock.
Not less than 80%, or 133,280 Aero shares, may be ac¬
on

May 31. Statement effective

Rocky Mountain Quarter Racing Association
31, 1957 (letter of notification) 300,000 shares of
common stock.
Price—At par ($1 per share). Proceeds
—To repay outstanding indebtedness.
Office—Littleton,
Oct.

subordinated sinking

Artists Productions Corp.
United Employees Insurance Co.
April 16 filed 2,000,000 shares of common stock (par $5).
Price
$10 per share. .Proceeds — For acquisition of
operating properties, real" and/or personal, including
office furniture, fixtures, equipment and office space, by
lease or purchase.
Office — Wilmington, Del. Under¬
writer—None.
Myrl L. McKee of Portland, Ore., la
.

—

President.

Tele-Broadcasters, Inc.
(letter of notification) 40,000 shares of com¬
stock (par five cents). Price — $3.25 per share.
Proceeds—To complete the construction of Station KALI.
Office—41 East 42nd St., New York, N. Y. Underwriter
—Sinclair Securities Corp., New York, N. Y.
Texas Calgary Co., Abilene, Texas
*
April 30 filed 2,000,000 shares of capital stock (par 25
cents). Price—To be supplied by amendment. Proceeds
—To selling stockholder.
Underwriter—Thomson Kernaghan & Co., Ltd., Toronto, Canada. To be offered in
Canada only.
Texas Eastern Transmission

Corp. (6/4)
May 15 filed 150,000 shares of preferred stock (par $100)
and 100,000 shares of subordinate convertible series pre¬
ferred stock (par $100). Price—To be supplied by amend¬
ment. Proceeds—For construction program. Underwriter
—Dillon, Read & Co., Inc., New York.
A Thomas Paint Products Co.
May 26 (letter of notification) 1,250 shares of common
(par $10) and $37,500 of 6% serial subordinated

stock

$15,000,000 of 6%

capital stock and warrants and debentures of Associated
f

ic United Funds, Inc., Kansas City, Mo.
May 26 filed (by amendment) $70,000,000 face amount
of Periodic Investment Plans (without insurance) and
$10,000,000 face amount of Periodic Investment Plana
With Insurance
(plus in each case an indeterminate
number of the underlying shares of United Accumulative
Fund par $1).

(6/25)

ic United Gas Corp.

May 22 filed $40,000,000 of sinking fund debentures due
1978.

Proceeds—To

due

notes

banks.

prepay

Sept. 22,

Underwriter—To

like principal

amount of

1959 held by eight commercial
be determined

by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.; The
First Boston Corp., Harriman Ripley & Co. Inc., and
Sachs

Goldman

Co.

(jointly); White, Weld & Co.,
Equitable Securities Corp.
(jointly). Bids — Expected to be received up to noon
(EDT) on June 25 at Room 2033, Two Rector St., New
York 6, N. Y.

Morgan

Stanley & Co. and

United Hardware Distributing Co.

May 5 filed

mon

filed

fund debentures, due 1963 to be offered in exchange for

(letter of notification) 14,250 shares of 7%
cumulative; preferred stock ,(par $10) and 10,000 shares
of common stock (par $1). Price—For preferred stock,
$10.25 per share; for common stock, $8 per share. Pro¬
ceeds—For working capital. Office—200 Sayre St., Rockford, 111. Underwriter — The Milwaukee Co., Milwau¬

Engineering, Inc.

March 31

•

Proceeds—For drilling for oil and gas.
Street, Coudersport, Pa. Under¬

Main

(letter of notification) 58,600 shares of common
(par 10 cents) and $293,000 of 6% five-year con¬
vertible debentures due June 1, 1963 to be offered in
units of 100 shares of common stock and $500 of deben¬
tures. Price—$510 per unit. Proceeds—To pay bank and
other notes payable and for working capital.
Office—•
4251 East Live Oak Avenue, Arcadia, Calif. Underwriter
—White & Co., St. Louis, Mo.

(par $9).
Proceeds—For
Underwriter—F, Eberstadt

/'/,

stock

March 31

cepted. Offer will expire
May 16.

...

common

May 7

Tel-A-Sign Inc., Chicago, III. (6/2-6)
April 24 filed 200,000 shares of common stock (par 20
cents). Price—To be supplied by amendment. Proceeds
—To retire $197,000 of notes and to reduce accounts pay¬
able by $150,000; the balance to be used for general
corporate purposes, including the increase of working
capital. Underwriters—Charles Plohn & Co., New York,
N. Y., and Clayton Securities Corp., Boston, Mass.

Reckcote Paint Co.

March

Tuttle

White, Weld & Co., both of New York.

7,500 shares of

writer—None.

•

Riddle Airlines, Inc., Miami, Fla.
May 15 filed 750,000 shares of common stock (par 10
cents). Price—To be supplied by amendment. Proceeds
—For working capital. Underwriter—James H. Price &
Co., Inc., of Coral Gables, Fla., for 250,000 shares; balance
on

Office—203

To be supplied by amendment.

(letter of notification)

—$4 per share.

Technology instrument Corp. (6/2-6)
March 27 filed 260,000 common shares (par $2.50) ol
which 204,775 shares are for account of three selling
stockholders and 55,225 shares are for account of com¬
pany. Price — $10 per share. Proceeds — For working
capital and general corporate purposes. Business — De¬
velops and manufactures precision potentiometers and
other precision electronic components and measuring in¬
struments.
Office—Acton, Mass. Underwriter — S. D.
Fuller & Co., New York.

T. J. Feibleman & Co., New

^Rhodesia and Nyasaland (Federation of)

sub¬

(6/11)

common

Congress.

Price—$4.50 per unit. Proceeds—For expenses incidental
to drilling for oil.
Office—111% E. St. Peter St., New

Iberia, La. Underwriter
Orleans, La.

Trans-Eastern Petroleum Inc.

Fund, Inc., Washington, D. C
1957 filed 40,000 Shares of common stock. Price
—$25 per share. Proceeds—For investment. Underwriter
—Equitable Securities Corp., Nashville, Tenn. Offering—
Held up pending passing of necessary legislation by

Underwriter—None.

class

its

capital

stock (par $1) to be offered pro-rata to stockholders on
the basis of one new share for 10 shares owned. Priee

Tax Exempt Bond

May 12 (letter of notification) 100,000 shares of class A
common stock
(par 50 cents) and 50,000 shares of class
B common stock (par 50 cents) to be offered in units of
shares

and

including exploration and drilling expenses and
expenditures. Underwriter—None.

! Feb. 27

June 20,

•jfc-Rand Drilling Co., Inc.

two

company

Office—c/o Franklin Craig, Jr., Route No. 3, Zanesville,
Ohio. Underwriter — Ross Securities, Inc., New York,

Private

Enterprise, Inc., Wichita, Kansas
May 5 filed 125,000 shares of common stock. Price—$10
per share.
Proceeds -4—. To be used to organize, or re¬
organize and then operate companies in foreign nations,
principally, but not exclusively, in the Far East, Near
-

;

acquisition, exploratory work, working capital, reserve^
and other corporate purposes. Underwriter—None. Alfred E. Owens of-Waterloo, la., is President.

ic Tamarao Gas & Oil Co., Inc. (6/4)
May 20 (letter of notification) 266,640 shares of common
stock (par five cents).
Price—$1.12 % per share. Pro-i
ceeds—For expenses incidental to oil and gas operations.

Saskatchewan,
Underwriter—Allied Securities Ltd., Saskatoon,
purpose.

—

& Co. and

residents of the United States "only in the State of North
Dakota." Price — $2.50 per share.
Proceeds — For con¬

struction

Corp., Denver, Colo.

♦

(James), Inc., New York

May 22 filed
Price

Manitoba,

one

Uranium Mining Corp. '
Nov. 6, 1957 filed 3,000,000 shares of common stock
(par
one mill). Price—25 cents
per share. Proceeds—For land

None.

Ltd.

Feb. 28 filed 210,000 shares of common stock (par $1.50)
to be offered for sale to residents of Canada in the Prov¬
of

Underwriter —Andersen-Randolph

Trans-America

1958 plan. Registration also covers
243,288 shares of outstanding common stock which may
be offered for possible sale by the holders thereof during
the period July 1, 1958 to June 30, 1959. Underwriter—

Office—1550 Rockville

Prairie Fibreboard

purposes.

Co., Inc., Salt Lake City, Utah.

—

with respect to the

For equipment and working cap¬
Pike, Rockville, Md. Under¬
writer—Whitney & Co., Inc., Washington, D. C.

Proceeds

to be publicly offered. Price—$5 per
new wells and for general

cent). Price—At market.
Proceeds
For investment
Office—Short Hills, N. J.
Underwriter—FIF Manage¬

sidiaries, together with 188,000 shares of common stock
(no par) which may be purchased by the trustees of the
plan during the period July 1, 1958, to June 30, 1959,

(letter of notification) $57,500 of 6% subordi¬
nated convertible debentures and 57,500 shares of class A
common stock
(par one cent) to be offered in units of
600 shares of stock and $500 of debentures. Price—$1,000

unit.

are

Townsend International Growth Fund, Inc.
May 14 filed 1,000,000 shares of capital stock (par

Sun Oil Inc., Philadelphia, Pa.
April 22 filed 15,000 memberships in the Stock Purchase

per

March 31

per
ital.

Shares, Inc., Austin, Texas.

Proceeds—To drill two

corporate
&

Proceeds—For

are

Trans-Cuba Oil Co., Havana, Cuba
March 28 filed 6,000,000 shares of common stock (par 10
Strategic Minerals Corp. of America, Dallas, Tax,
March 31 filed $2,000,000 of first lien mortgage 6% bond! ./cents) to be offered for subscription by holders of out:
standing shares of capital stock and holders of bearer
and 975,000 shares of common stock (par 10 cents). Price
;
shares, in the ratio of one additional share for each share
—For bonds, 95% of principal amount; and for stock $3
i so
held or represented by bearer shares.
Price—50©
per share. Proceeds—To erect and operate one or more
Proceeds—For general corporate
chemical processing plants using the Bruce - Williams : per share.
purpose^

Policy Advancing Corp.
(letter of notification) 30,250 shares of com¬
stock (par $5) to be offered for subscription by
offered

unit for

one

(500 of the shares

Tip Top Oil A Gas Co., Salt Lake City, Utah
April 15 filed 220,000 shares of common stock, of which
200,000 shares

Co.

being offered in exchange for common shares of Inter¬
national Petroleum Co., Ltd., of Toronto, Canada, and
Coral Gables, Fla., in the ratio of nine shares of Stand¬
ard Oil stock for 10 shares of International stock. Offer;
will

the basis of

—

during 1958. Underwriter—Snow,
Sweeney & Co., Inc., New York, and A. C. Allyn & Co.,
Inc., Chicago, 111.
• Standard Oil Co.
(New Jersey)
May 5 filed 2,246,091 shares of capital stock (par $7)

mon

new

(10 cents per
Address—P. O.
Underwriter—

par

those of its subsidiaries

March 25

one

Price—At

shares of stock owned

(6/9-13)
May 19 filed 30,000 shares of cumulative preferred stock
(par $100). Price—To be supplied by amendment. Pro¬
ceeds—To be added to the company's general funds and
used to defray a portion of the company's current pro¬
gram of property additions and improvements, including

—

share held; unsubscribed shares to be
debenture holders and to others.
Price—$8

1958, to be offered in units of one
$50 principal amount of debentures

Timeplan Finance Corp.
March 25 (letter of notification) 27,272 shares of 70-cerit
cumulative preferred stock (par $5) and
27,272 shares
of common stock (par 10 cents) to be offered in units
of one share to each class of stock.
Price—$11 per unit
Proceeds
For working capital.
Office — 111 E. Main
St., Morristown, Tenn. Underwriter—Valley Securities
Corp., Morristown, Tenn.

non¬

collateral; and $275,000 for working capital, re¬
etc. Office—Raleigh, N. C. Underwriter—None.

Southern

;

stockholders at the rate of

stock.

two

and

being offered to the President of the company). Price—
per unit.
Proceeds—For working capital. Office—
543 Whitehall St., S.
W., Atlanta, Ga. Underwriter—
None.
'
: "
1

Southern Frontier Finance Co.

Peoples Protective Life Insurance, Co.
March 27 filed 310,000 shares of common stock (par $1),
consisting of 62,000 shares of class A-voting stock and
248,000 shares of class B-non-voting stock to be offered
in units consisting of one class A and four class B
shares.
Price
$75 per unit. Proceeds — For working
capital and for development of district offices in the
Btates where ;the company is currently licensed to do
business.
Office—Jackson, Tenn.
Underwriter—None.
R. B. Smith, Jr., is President and Board Chairman.

each

series

of stock

$60

May 15 filed 2,000,000 shares of common stock (par 50
cents). Price — $1 per share. Proceeds — $1,525,000 for
purchase of receivables secured by Mobile Homes, or

Pierce, Fenner & Smith; Glore, Forgan & Co., and W. C.
Langley & Co. (jointly); Kidder Peabody & Co. Inc.,
and White, Weld & Co. (jointly). Bids—Expected to be

common

each

None.

Lehman Brothers; Smith, Barney & Co.; Merrill Lynch,

common

Proceeds—For mining expenses.
3024, North Johnson City, Tenn.

Box

from

Mines, Inc.
(letter of notification) 3,000,000 shares of

share).

operations, toward the
company's construction program. Underwriter — To be
determined by competitive bidding.
Probable bidders:
The First Boston Corp. and Blyth & Co. Inc. (jointly);

received after June 2.

debentures

Road,

to be offered to stockholders

assessable

Pennsylvania Power Co. - (6/3)
May 7 filed 60,000 shares of cumulative preferred stock
Proceeds—Together with cash

Windover

May 19

& Co., Dallas, Texas.

Co.,

A Southeastern

(par

sale of the 300,000 shares, to be used to pay 6%
mortgage
notes and interest and to pay back tax claims, and inter¬
est due on the note to Mr. Harroun. Underwriter—Wiles

(par $100).

Ford

New York.

10 cents), of which 300,000 shares are to be offered for
sale by the company and 1,700,000 shares by the present
holders thereof. Price—$1 per share.
Proceeds—From

estimated

• Searle (G. D.) & Co., Chicago, III. (6/11)
May 22 filed 250,000 shares of common stock (par $2).
Price—To
be supplied by amendment.
Proceeds—To
selling stockholders. Underwriter—Smith, Barney & Co.,

Inc., Pasadena, Calif.
20,000 shares of common stock (par $1).

19 filed

Underwriter—R.

Memphis, Tenn.

Peckman Plan Fund,

May

(2429)

1,475 shares of 5%

cumulative preferred

(par $100), and 11,750 shares of common stock
(par $10) to be offered to retail hardware dealers who
are stockholders of the company to equalize holdings

stock

Price—For preferred

stock, $100 per share; for common

stock, $50 per share. Proceeds—For working capital to
be used to increase inventory of hardware items. Offico
—Minneapolis, Minn. Underwriter—None.
United States Lithium Corp.

(letter of notification) 580,000 warrants bearing
rights to purchase 580,000 shares of common stock (par

May 5
10

cents);

market.

warrants expire Oct.

Proceeds—For

mining

18, 1960.
expenses.

Price — At
Office—504

Walker Bank

Bldg., Salt Lake City, Utah. Underwriters
—Peter Morgan & Co. and Greenfield & Co., Inc., hot!*
of New York, N. Y.; Dagget Securities, Inc., Newark,
N. J.; Julius Maier Co., Inc., Jersey City, N. J.; Bauman
Investment Co., New Orleans, La.; and Walter Sondrup

Continued

page

(2430)

The Commercial and Financial Chronicle

Continued from page 41

Yonkers, N. Y. Underwriter
Broadway, New York 6, N. Y.

& Co. and Thornton D. Morris &

Co., both of Salt Lake

City, CJtah.
United States Sulphur Corp.
0<il B filed 1,500,000 shares of common stock

—

Edwin

Jefferson,

^ Winter Park Telephone Co.
May 19 (letter of notification) a maximum of 6,619 '
shares of common stock (par $10) to be offered to employees under- the company's Employees' Stock Plan. 7"
Proceeds—For extensions, additions and improvements
;
of telephone plant and for working capital. Office—132 7
East New England Ave., Winter
Park, Fla.- Underwriter
-

(par

on«

cent). Price—$1 per share. Proceeds—For plant rental
etc.; to retire corporate notes; for core drilling; foi
working capital; and for other exploration and develop
ment work.
Office
Houston, Texas.
Underwriter —

—None.

•'

■

/J-'

■

None.

,•

(par $1)
Price—$4 per share. Proceeds—To purchase equipment
and supplies and for working capital and other corporate
purposes. Office—Salt Lake City, Utah.
UnderwriterAmos Treat & Co., Inc., of New York.
1

Uranium Corp. of America, Portland, Ore.
April 30,1957 filed 1,250,000 shares of common stock(par
16 cents).
Price—To be supplied by amendment (ex¬
pected to be $1 per share). Proceeds—For exploration
purposes.
Underwriter—To be named by amendment.

Griswold

Portland,

Ore.,

is Pres¬

ident.

Thursday, May 29, 1958

bank loans and for construction program. TJnderwriters
—May be The -First .Boston, Corp.; Kidder/Peabody &
Co.; Merrill iSynch, Pierce, Fenner & Smith; and White,
Weld & Co.; all of New York.

Florid*

Pqwer.Coij>.: (7/1) t;.
;
29 it was reported corporation plans to issue and *
$25,000,000 pf first mortgage bonds due 1988. Under¬
writer—To be determined by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Kidder, Peabody.
Jan.

sell

& Co. and Merrill

Lynch, Pierce, Fenner & Smith (joint¬
ly); Lehman Brothers and Blyth & Co., Inc. (jointly);

Co., and Harriman
Ripley & CoJFac. (jointly); The First Boston Corp.; Bids
Expected to: be received up to 11:30 a.m.- (EDT) on
''f ff
July 1.

United States Telemaii Service, Inc.

Albert

Eastman Dillon, Union Securities &

Fdb. 17 filed 375,000 shares, of common stock

Graham

Utah Minerals Co.

Prospective Offerings
Acme

Co.

Steel

March 21 it

tional financing this year, in the form of

preferred stock,
bank

loans.

or a

Proceeds—For

and

Alco

Merrill

program,

♦

reported that company plans to issue
$11,000,000 iof.iirst mortgage bonds later this year. No decision

as yet'has been made as to the procedure the comwill follow, v Proceeds—For repayment of short-

term

Smith.

notes1 and

Underwriter

Inc.

loans

and vfor

construction

program.

*
'

determined

bidders may be
Lynch, Pierce, Fenner & Smith, and White,
Weld & Co. (jointly); Blyth & Co., Inc.; The First Boston
Merrill

ing plans for long-term refinancing. Proceeds—For pay- -•
,:
payable and provide the company with
Corp.; Lehjhan /Brothers.
V '.7
?
additional working capital. Underwriter—Eastman Dil¬
General-Acceptance €orp.</<
/
*
lon, Union Securities & Co. may handle any common 7
April 22 it was reported that the stockholders will vote t
stock financing.
May 21 on approving the creation of 1,000,090 shares of
Associates Investment Co." \
*
v
preferred stock (no par), of which 80,000 shares are to
Jan. 23 it was reported company plans to issue and sell -v
be 60-cent series. Underwriter—Paine,
Webber, Jackson ;
some additional debentures (amount not
yet determined)
I & Curtis.
ment of all notes

April 11 (letter of notification) 900,000 shares of com¬
mon stock. Price—At par (10 cents per share). Proceeds
—For mining expenses. Office—305 Main St., Park
City,
(Jtah. Underwriter—Walter Sondrup & Co., Salt Lake
City, Utah.
Utah Oil Co. of New York, Inc.
May 6 (letter of notification) 300,000 shares of capital
stock. Price
At par ($1 per share). Proceeds — For
—

„

development of oil and gas lands. Office—574 Jefferson
Ave., Rochester 11, N. Y. Underwriter—Frank P. Hunt
& <Co^ Inc., Rochester, N. Y.

Virginia Electric & Power Co. (6/10)
May 6 filed $25,000,000 of first and refunding mortgage
bonds, series O, due June 1, 1988. Proceeds—For con¬
struction

thereof.

bidding.

expenditures or to reimburse the treasury
Underwriter—To be determined by competitive
Probable bidders:

Halsey, Stuart &

Co.

Salomon Bros. &

Inc.;

Hutzler; White, Weld & Co.; Eastman
Dillon, Union Securities & Co.; Stone & Webster Securi¬
ties Corp.; Kuhn, Loeb & Co. and American Securities
Corp. (jointly).
(EDT) on June
New

Bids—To
10

Room

received

238,

a.m.

Exchange Place,

York, N. Y.

Underwriters

Salomon Bros.

—

Brothers, both of New York.
July 1.

& Hutzler

and

Lehman

Walker-Scott Corp., San Diego, Calif.
April 28 filed $900,000 of 6% subordinated sinking fund
debentures due 1973, with warrants, and
40,000 shares of
common stock (par
$1), of which the company proposes
to offer $400,000 of the
debentures (with warrants) in
exchange for its presently outstanding 4,000 shares of
7% preferred stock at the rate of
$100 of debentures for
each share of preferred. Price—At
par for debentures:
and for stock $7 per share. Proceeds
Together with
other funds, to repay an insurance
loan, and for work¬
ing capital, etc. Underwriter
Eastman Dillon, Union
Securities & Co., New York, N.
—

—

Y., and San Diego, Calif.
Offering—Now being made.
* Walnut Grove Products Co.,
Inc., Atlantic, Iowa
May 26 filed $500,000 of 6%
sinking fund debentures,
series A, due 1968. Price
100% of principal amount.
Proceeds—For expansion program and
working capital.
Business—The formulation, manufacture and
sale of a
complete line of livestock feed
supplements minerals
and pre-mixes.
Underwriter
The First Trust Co. of
Lincoln, Neb.
—

May 26 filed (by amendment) an
additional 10,000,000
shares of common stock
(par $1) in the Fund. Price—At
market. Proceeds—For investment.

Coast Airlines, Inc., Seattle, Wash.

Feb.

12 filed (as
amended) 90,000 shares of
stock (par $1)
being offered for subscription

common

mon

com¬

stockholders of record May
1, 1958 at rate of one
new share for each
two shares
held; rights to expire on
May 30. Price—$4 per share.
Proceeds—For working
capital. Underwriter—None.

Western Electric Co., Inc.
April 17 (letter of
notification) 2,853 shares of common
stock (no par)
being offered to minority stockholders at
o
inco^ new share for each 10 shares held as of April
I
Wrig
io exPire on May 29. Price
$50 per
snare.

—

Proceeds—For plant

general corporate
purposes.

York 7, N. Y.

improvement, expansion

Office—195 Broadway, New

Underwriter—None.

★ Western Pacific Mining
Co., Inc.
MW 26 filed 564,000 shares of common
par

($1

per

and

share).

Price

Proceeds—For capital expenditures
Office—Santa Paula, Calif
Un¬

r?f.Sf °"e

new share for each four shares held

additional share

for

and

one

the

balance of such
holdings in
shares divisible by
four; also
to be offered
holders of
outstanding 5% subordinated
debentures of record March 24
at rate of five shares for
eaph $1,000 of debentures then held.
Price
$60 per
e**ss of

the -number of

—

None.

Proceeds—For working

capital.

Underwriter—

? *y.ilie<'.^olor Television System, Inc.
Agril 2 (letter of notification) 72,035 shares

(6/3)
of common

stock (par $1) of
which'10,000 are to be offered to stock¬
holders at $2 per share and the
remaining 62,035 shares
a* to be
publicly offered at $3 each. Proceeds
For
general corporate purposes.
Office—151 Adell Avenue

—

„

Robinson-Humphrey Co., Inc., both of Atlanta, Ga. 7 dent, that" the/Company * plans to issue approximately
Offering—Expected to be made in July.
$21,000,000' of! government insured bonds secured by a
• Boston Edison Co.
first preferred ship mortgage on the new "Santa Rosa"
(7/10)
May 27 it was announced company may issue and sell
250,000 shares of cumulative preferred stock (par $100).
Proceeds

To repay bank loans and for construction
Underwriter — The First Boston Corp., New
Registration—Scheduled for June 20.
—

York.

March 20

California
March 10 it

Office—391
Electric

Ludlow

St., Stamford, Conn.

Power Co.

reported company may issue and sell in
1958 about 450,000 additional shares of common
stock.
Underwriter—To be determined by competitive
bidding.
Probable bidders: White Weld & Co.;
was

Louisiana

•

Electric

announced that the

sey,

semi-annual

instalments.

Probable

bidders:

(jointly).
in 1958

Feb.

for

bidders: Halsey,

Consumers Power Co.
21 Dan E. Karn,
President, announced that $100,600,000 has been budgeted for expansion and improve¬

of service facilities
during 1958. Indications are
$60,000,000 of senior securities may be involved.

Shields

Co.

(jointly);

nancing, the type of securities to be
Proceeds—For expansion.
ley & Co. Inc., New York

some

announced

■

ably preferred stock, to

* 7 ;

Chairman, announced that com¬
pany plans to-sell some bonds originally scheduled for
mid-year, but which sale may now be deferred until
late 1958 or early 1959/ Proceeds—About $8,000,000 for
construction program.1 ^Underwriter—To be determined
by
competitive -bidding, ^Probable
bidders: Halsey,
Stuart & Co.: Inc.; Kidder, Peabody & Co., and Merrill
Lynch, Pierce, rFenner ,&
Smith /jointly); Lehman
Brothers; Eastman Djllphr Union Securities & Co. and
Stone & Webster Securities-Corp. (jointly); Glore, Forgan & Co., and Goldman Sachs & Go. (jointly).' ;
14

Power

Light Co.

.announced, company

plans to issue and
$10,000,000 of first mortgage bonds due 1988. Pro¬
ceeds—For- construction program.
Underwriter—To be
determined by competitive bidding.
Probable bidders;
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Glore,
Forgan & Co.; Harriman Ripley 3c Co. Inc.; White, Weld
& Co.; Blyth
Co., Inc.; Equitable Securities Corp.
was

Jan. 21 it

Underwriter—Harriman Rip¬

secure approximately $5,000,000
Proceeds—Together with $7,000,000
private sale of 4^% bonds, to repay short-term

J- ;7,^.7- V 7 -7"

Kentucky Utilities Co. 7
'
was reported company plans to issue and sell
$10,000,000 of first mortgage bonds. Proceeds—To repay

fi¬

later.

bank loans and for
be determined

company expects later
in the year to issue and sell additional
securities, prob¬

from

inc.*/*—

sell

Equitable Gas Co.
April 7 it was reported that the

of additional funds.

Water,Co.,

announced-ithat the

construction.

Kansas

Dixon Chemical Industries, Inc.
March 10 it was reported company plans to do

;

and sell

new

Febi

The

First Boston Corp. and
Harriman Ripley & Co. Inc.
(jointly). An offering of
$35,156,700 of 4%% convertible debentures, offered to
stockholders, was underwritten in October, 1957, by Mor¬
gan Stanley & Co.
'

it-was

Kansas Gas & Electric Co^.,

ing—Expected in second quarter of 1958.

ment

com¬

March 31, G. W. Evans,

determined

by competitive bidding. Prob¬
Stuart & Co.; White, Weld & Co.
and Paine, Webber, Jackson & Curtis
(jointly); Morgan
Stanley & Co. and First Boston Corp. (jointly). Offer¬
able

President, said that

if IngersolURatid Co. (6/2-3)
May 27 it was1 announced-a secondary offering of 247,824
shares of common stock/ho par) is planned. Proceeds—
To selling stockholders. -Underwriter—Smith/Barney &
Co., New York:
< ;
' 7 7-:

Dillon, Read & Co. Inc. and The Ohio Co.
Permanent financing not expected until late
possibly early in 1959.

George H.; Buck,

company plans to
$3,000,000 of-first mortgage bonds. May
placed privately. /Proceeds—To repay bank loans and

issue

was announced
company plans to issue and
$45,000,000 of sinking fund debentures. Underwrit¬

ers—To

preferred stock. Recent bond financing was made"'
privately. In event .of-competitive bidding for bonds or
debentures, bidders may include: Halsey, Stuart & Co.
Inc.; The First,. Boston Corp. and White, Weld & Co.(jointly); Stone & Webster Securities Corp.; Blyth
Co., Inc.; Drexel & Co. and Dean Witter & Co. (jointly). *
The First Boston Corp. and White, Weld & Go. (jointly) r
underwrote last common stock financing. There is no '
preferred stock .presently outstanding. Private sale of '
30,000 shares ($3,00,0,000) of preferred is planned.

Consolidated Natural Gas Co.
sell

and

March 25

Columbus & Southern Ohio ^Electric Co.
Dec. 9 it was reported company plans to issue and sell
about 250,000 additional shares of common stock.
Under¬
—

12,

Indiana Gas &

Hal¬

Stuart & Co. Inc.: Salomon Bros. & Hutzler.

writers

pany plans to s^l softie $7,000,000 in new securities by
the end of this y%ar in the form of first mortgage bonds

the year

Chicago, Burlington & Quincy RR. (7/1)
May 14 it was reported company plans to issue and sell
on July 1
$4,650,000 of equipment trust certificates due

May include: Blyth & Co., Inc.; Carl M. Loeb, Rhoades
& Co.; Hemphill,. Noyes & Co.; Smith,
Barney & Co.;
and Merrill Lynch, Pierce, Fenner & Smith.
'Hackensack Water Co.

Co., Inc.
company's financing
1958 anticipates the sale of both
debt and equity securities
(probably preferred stock)
aggregating approximately $5,000,000. Both issues may
be placed privately.
was

program for

—

March

Kidder, Peabody
& Co.; Merrill
Lynch, Pierce, Fenner & Smith; Carl M.
Loeb, Rhoades & Co., and Bear Stearns & Co. (jointly).
Central

■■

"Santa; Paula."
Underwriters
Merrill Lynch, 1
Pierce, Fenner and Smith; Paine, Webber, Jackson &,
Curtis; Smith, Barney Co.; White, Weld & Co.; and F.
Eberstadt & Co'., all of New York.
Offering—Tenta¬
tively scheduled for June.

Feb. 19 it was reported a secondary offering of common
voting stock is .expected in near future. Underwriters—•

was

—Electronics.

■>

Great Atlantic & .Pacific Tea Co.

reported that company plans to issue
$500,000 of common stock. Proceeds—For
working capital and other corporate purposes. Business

March 28 it

and

Laboratories, Inc.

and sell about

spare.

and

Underwriter—For any bonds, to be determined by com¬
petitive bidding.
Probable bidders: Halsey, Stuart &
Co. Inc.; Morgan Stanley &
Co.; White, Weld & Co. and

April 17 filed 7,799 shares of
capital stock to be offered
for subscription
by stockholders of record March 24
at

—

derwriter—None.

Minot, N. Dak.

—

that

Westland Oil Co.,

stockholders' approved;

and exploration costs.

Utilities Corp.

/
.^IV.'vr.v
plan- authorizing the *
directors in connection with" an "'offering of common stock r
Atlanta Gas Light Co.,..,.
to stockholders,'also to offer certain shares on the same
May 5, the directors authorized the offering of 121,317 shares of common stock (par $10) to stockholders on 7 terms to employees, Including officers, of System com- I
panies. Clearing Agent—Merrill Lynch, Pierce, Fenner 1
the basis of one new share for each eight shares held.
& Smith, New York.
; ■
/
Price
To be named later.
Proceeds
To repay bank
loans
and for construction program.
.Grace 'Line 1ric.f7>/rv/
Underwriters—
; 77:/ /v/"/••••• '/ 7:V
The First Boston Corp., New York; and Courts & Co. / March 20 it was announced
by Lewis A. Lapham, Presl- r

Feb.

stock.

General Public

April

—

Wellington Fund, Inc., Claymont, Del.

Offering—Expected befor#

program.

•

by competitive bidding,
Halsey,' Stuart & Co. Inc.;

—

probable

announced that the company is consider¬

was

—

it Was

pany

work¬

Underwriters—Blyth & Co.,

Lynch, Pierce, Fenner &

Products

March 6 it

expansion

Service' Cb.,

March 24

common

stock,
combination of the two, including

ing capital and inventories.
Inc.

Gas

announced that the company plans addi-

was

new

construction.

Underwriter—To

by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; Lee Higginson Corp.; .Equitable •,Securities
Corp.; Eastman Dillon,
Union Securities & .Co. and Merrill Lynch, Pierce, Fenner
& Smith (jointly); Kidder, Peabody & Co. and White,
Weld & Co. (jointly); Kuhn, Loeb & Co. Offering—Ex¬
pected in September or October.

Volume

187

The Commercial and Financial Chronicle

Number 5746

(2431)

:-Kentucky Utilities Co.
Jan.

21s it was

also

group of banks and expects to sell

that,

reported

stock

its.common

this

• may
offei its common
J-fbr-15/ basis

company

approximately 165,000 additional shares
stockholders-

year

New York Telephone Co.

May 1 it
Laclede Gas Co.] (7/8);
May 15 it was announced company, plans - to issue and.
sell 320,000 shares, of. .cumulative preferred stodk
(par
$25j> Proceeds-^-To retire bank loans- andr4or construc¬
...

tion

program; VXTnderw^iters

Merrill.

York;
V

Lehman-Brothers

Lypch, Pierce,;, Fenner

and...

Smith, both of New

7*kXX'.'X*.~'.7 '-!•

Laclede Gas Co.

••

-*v.

with

j|7/9).,*':' 7>77;7v777'7*:77

ceeds—To refund 4V&%

Stuart

Bids

(jointly); Eastman Dillon, Union Securities &
Co.: Stone & Webster Securities Corp. Bids—Tentative¬
ly expected to be received up to 11 a.m. (EDT) on July 9.

Northern

April 14 it

Managers—Lazard" Freres

tion— Expected shortly.:

Master Fund,

Jan, 27

this

of tt)je. Fund.

newly organized invest¬

ment

company plans to offer to bona fide residents of
California 10,000 shares of capital stock (par, $1). Price
—$10 per share, less an underwriting discount of 8l/2%

Proceeds—For investment.

/Vw..

Midland Enterprises, Inc.
March 28, company announced

;

—To

announced

was

that

»v-

{

this -subsidiary

Tennessee Gas Transmission Co. has applied
eral Power Commission for- permission tp

toibe

Fed¬
issue first

bonds,' unsecured notes and common, stock.
Proceeds-—To: build pipe line system to cost about $111,-

Montana-Dakota: Utilities

March 24 it
sell

reported the.- company plans /to- issue and

was

undetermined amount of first mortgage bonds in

the latter part of

this year or in early 1959. Underwriter
—To be-determined by competitive bidding.
Probable
bidders:

;Go. Inc.; Blyth & Co., Inc.;

Halsey,v Stuart

Merrill

Lynch, Pierce,- Fenner & Smith, ant^ Kidder*
Peabody &. Co.*. Incr, (jointly); and Bla^;&. Gd.j.Inc.
Montana Power Co.

May 12 it
sell

Moore-McCormackLines,
March 24 it

was

Inc.

the

Naxon

March

was

Price

Parker

—

that it is

that it

Underwriter — Auchincloss,
Washington, D. C. G

company plans to market
$30,000,000 of common stock in the latter part, of
this year or in the first
quarter of 1959. Proceeds—For
construction program.

about

Washington Gas Light Co.
March 24 it
sell

clude

Underwriter

by competitive bid¬

First

about

Brown &

sell $40,000,000
like amount of

St.

of debentures.

Proceeds—To redeem a
bonds due 1961.' Underwriter—To

market

Wisconsin

be determined by

competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; The"-First Boston Corp.; Mor¬
gan Stanley & Co." Bids
Expected to be received on
Aug. 26.:
V
".I, v.JG*' \W.. •; ' l;
,

500,000, and

Merrill Lynch Adds f.
■

(Special to The Jin"4Ncial

PENSACOLA, .F 1

—

William

Wisconsin Public Service Corp.
March 4 it

decided

by competi-

McDowell,

Blosser

now

affiliated

with

Pofit, Homsey & Company, 31

ST.

LOUIS,

O'Connell

has

Mo.—Clemence H.
been

added

to the

staff of Morfeld, Mo6s & Hartnett,
721 Olive Street, members of the

Midwest Stock Exchange.

members

Joins

Goodbody Staff

BOSTON,

the

Exchange.

Pacific

was

Coast

previ¬

With Luce, Thompson

(Special to The Financial Chronicle)

Mass.

—

Morgan

;

(Special to The Financial Chronicle)

(Special to The Financial Chronicle)
>

ANGELES, Calif.—Robert

ously with Hill Richards & Co.

Tucker, Anthony Adds
&

LOS

Raport is now with Revel Miller
& Co., 650 South Spring Street,
Stock

DETROIT, Mich.
Jones

has

joined

—

Frank M.

the

staff

Inc.

With Paine, Webber

39
South
La ». Salle .Palmer has been added to the
Sheet, members of the New York .staff of Tucker, Anthony & R. L.
and Midwest Stock Exchanges.7Day, 74 State Street.
,

Dillon, Union Securities & Co., (jointly); Leh¬
Brothers; Kuhn, Loeb & Co. and A. C. ARyn & Co.
(jointly); The First Boston Corp.; White, Weld Ai
Co.; Kidder, Peabody & Co
man

(Special to The Financial Chronicle)

Straus, Blosser

with.. Straus,

been
com¬

Revel Miller Adds

(Specia^to The Financial Chronicle)

of securities has not yet
Underwriter—To be determined by

Eastman

Halsey, Stuart & Co. Inc.;
Smith, Barney & Co., ,Glore, Forgan & Co. and Blair
& Co. Inc. (jointly); White, Weld & Co.; Equitable Secu¬
rities Corp. Last preferred financing was done privately.

Milk Street,, members of the New
York' and
Boston
Stock
Ex¬

CHICAGO, 111.—John C." Wax¬
ier

company plans to sell about
securities in the last half of the cur¬

type

petitive bidding. Probable bidders: (1) For any bonds—
Halsey, Stuart & Co. Inc.; White Weld & Co.; The First
Boston Corp.; Kidder,
Peabody & Co.; Merrill Lyneh,
Pierce, Fenner & Smith; Eastman Dillon, Union Secu¬
rities & Co. and Salomon Bros. & Hutzler
(jointly);
Kuhn, Loeb & Co., and American" Securities Corp*
(jointly). (2) For any preferred stock—Merrill Lynch,
Pierce, Fenner & Smith; Salomon Bros. & Hutzler and

preferred stock "sometime

changes. '

Joins

on.

new

The

(Special to The Financial Chronicle)

Lynch,
Pierce, Fenner & Smith, 37 West

year.

announced

was

$12,500,000 of

tive bidding. Probable bidders:

BOSTON, Mass. —Robert P.

Merrill

GardeTi Street

Smith,

Morfeld, Moss Adds

Baggj*. JrZ is

Inc.;

(Special to The Financial Chronicle)

staff

Co.

Eastman

Peabody & Co. and Salomon Bros. & Hutzler
(jointly);
The First Boston
Corp. Offering—Not expected until
late in 1958 or early in 1959.

that the company plans to

to be determined

and

(Special to The Financial Chronicle)

L. Barrineau, Jr.. has been added*,

the

bonds

Corp.

With du Pont, Homsey

Chronicle)r'

&
&

Co., Inc. (jointly);
Dillon, Union"
(jointly); White, Weld & Co., Kidder.

Equitable Securities

increase in preferred stock from 25,000

Underwriter—For

Co.iV

announced that approximately $.7,500,000
frbm. additional.financing will be. required fof construc¬
tion expenditures for the-bal.anee of this;year.; The man¬
agement intends to negotiate a new line of credit with a
was

by competitive bidding.

bidders: Halsey, Stuart
Barney & Co. and Robert W. Baird

on May 21 will vote on
increase in bonded indebtedness of $6,-

Light Co.

Probable

The stockholders

announced that company plans to issue

Securities & Co.

plans to issue apd
may in¬
Proceeds—For construction

securities, which

$10,000,000 of first mortgage bonds. Proceeds—
To retire bank loans and for construction
program. Un¬
derwriter — To be determined

shares to 50,000 shares. Proceeds — For repayment of
short-term bank loans and for construction program.

New. York State. Electric and Gas
March 7 it

authorizing

Power

was

and sell

$6,500,000 in bonds

this summer."

new

Underwriters—Johnston, Lemon & Co., Alex.
Sons, Auchincloss, Parker & Redpath and FolOffering—May be early in Summer. '

March 17 it

Board, an¬
likely the corporation will sell some

announced

was

announced company

preferred stock.

ger, Nolan Inc.

Joseph Light & Power Co.
15 it

was

$7,000,000 of

some

program.

Boston

April

Underwriter—-

Union Electric Co., iSt.
Louis, Mo.
March 28 it was announced

rent

New England Telephone & Telegraph Co. (8/26)
April 11 it: was announced eompany plarts to issue and

Co., Inc., and, Dominion Securities

Telephone & Telegraph Co.
Jan. 8 it was reported company plans
$300,600,000 capi¬
tal outlay program. Proceeds—For construction program
in 1958 and 1959 ($137,000,000 in 1958). Underwriter—
To be determined by competitive bidding. Probable bid¬
ders— Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.

by this corporation

plans early

Corp., both of New York.

June 30.

early 1959.

bidders—The

cisco and New York.

$5 per share;

Redpath,

registration bonds in the United States.
Harriman Ripley &

company plans sale of an
bonds and preferred stock in

year or

^Toronto (Province of), Canada.
May 26 it was reported that the Province

common
stock within the next several months
(prob¬
ably to stockholders); Proceeds—For new facilities and
equipment. Underwriter—Blyth & Co., Inc., San Fran¬

plans to issue and sell 120,000 shares common stock (par

$1).

(7/17)

reported company plans to issue and sell

was

$17,000,000 of first mortgage bonds. Proceeds—For con¬
struction program.
Underwriter—To be determined by
competitive bidding. Probable bidders:
Halsey, Stuart
& Co. Inc.; Stone & Webster
Securities Corp.; Kuhxi^
Loeb & Co.; Merrill
Lynch, Pierce, Fenner & Smith;
Goldman, Sachs & Co. Bids—Expected to be received on
July 17.

Pacific

announced

Tampa Electric Co.
May 14 it

Offering—Ex¬

Telesign Corp.

—Expected in June.

Underwriter

reported

amount

Probable

nounced

•''/

••

was

Under¬

Co., both
Francisco, Calif., and New York, N. Y. Offering

of San

Lighting Corp.
May 8 Robert W. Miller, Chairman of the

Underwriters—Kuhnr;Loeb*.& Co.

pected this Summer!

tional capital for the
company's overall program.

writers—Blyth & Co., Inc., and Dean Witter

Pacific

■

and Lehman Brothers, both of New York.

was

announced by R. G.
Follis, Chairman of
board, that it is planned to issue
$150,000,000 of
long-term debentures. Proceeds—To refinance a bank
obligation of $50,000,000 due this year to
provide addi¬

reported that the company plans to issue

the

Corp. and
Halsey,Stuart & Co. Inc. (jointly); Blyth & Co., Inc.; (2)
I or preferred stock: Blyth &
Co., Inc.

vk) y
i.
i
announced company plans to. issue and

S. Argentina.

(EDT)

Railway Co.

was

Standard Oil Co. of California

Co.

and

1978.

$20,000,000 of bonds.

May 6 it

(Minn.)

For bonds to be determined

ding.

sell 824,000,000 of government.insured bonds secured by
first preferred ship mortgage on the liners SnS. Brazil
S.

Co.

•

Power Co.

latter part of this

—(1)

and

Service

determined

undetermined

.—

due

Underwriter—To

mined

Pacific Gas & Electric Co.
March

$20,000,0.00 of ;first; mortgage bonds due 1988.
Proceeds
Bor exploration and construction program.
Underwriter—To be determined by competitive bidding.
Probable bidders;* Halsey, Stuart & .Gp. Inc.^Xehman
Brothers; Merrill, Lynch, Pierce,-*Fenner.Smith, and
Stone & Webster Securities Corp. (jointly); White, Weld
& Co.;-Eastman DillonUnion. Securities & Co.; Kidder
Peabody & Co., Smith, Barney & Co. and Blyth & Co.,
inc..(jointly). Bids—Expected to be received On Sept. 4.
and

Public

(9/4)

debentures

program.

Underwriter—To be deter¬
by competitive bidding. Probable bidders:
Halsey,
Stuart & Co. Inc.; Kidder
Peabody & Co., Inc.; The First
Boston Corp. and
White, Weld & Co. (jointly); Morgan
Stanley & C,o.; Eastman Dillon, Union Securities &
Co.,
and Salomon Bros. & Hutzler
(jointly).

was

received up to 11 a.m.

reported that the company plans to issue

.was:

Southern
March 20 it
about

Orange & Rockland Utilities, Inc. (6/30)
May 15 it was announced that company has applied to
the New York P. S. Commission for
permission to issue
and selj $10,000,000
first»mortgage bonds due 1988. Pro¬
ceeds—For construction program.
Underwriter—To be
determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; The First Boston Corp.; W. C.
Langley & Co.; Equitable Securities Corp. Bids—To be

Co.

construction

—

(jointly); Equitable Securities Corp. and
Dillon, Union Securities & Co. (jointly). Bids
—Expected to be received up to 11 a.m. (EDT) on July 8.

Underwriters — Stone" & Webster Securities
Corp. and White Weld & Co., both of New York.

(7/10)
plans to issue

fund

June 12.

Eastman

000,000.
!r

Co.

company

sinking

—

by competitive bidding. Probable
bidders: Halsey, Stuart & Co. Inc.; The First Boston
Corp. and Blyth & Co., Inc. (jointly); Merrill Lynch,
Pierce, Fenner & Smith, Kidder, Peabody & Co. and
White, Weld & Co. (jointly); Lehman Brothers and
Riter

mortgage

determined by competitive
bidding. Probable bid¬
Halsey, Stuart & Co. Inc.; The First Boston
Corp.;
Blyth & Co., Inc., and Kidder,
Peabody & Co. (jointly)^
Bids
Tentatively scheduled for July 10 at 90 Broad
St., New York, N. Yi
Registration
Expected about

Halsey, Stuart & Co. Inc.;

bonds and for construction program.
be

$30,000,000

Secu¬

ders:

Co.

•

Gas

announced

(7/16)

reported company plans to offer to its
common stockholders about
370,000 additional shares of
common stock on a l-for-10 basis.
Underwriters—Dean
Witter &. Co.; Blyth &
Co., Inc.; and Merrill Lynch,

of 5%

Indiana

Underwriters—Stone & Webster
Paine, Webber, Jackson & Curtis.

Natural

was

Proceeds—For

(7/8)
April 28 it was reported that the company may be con¬
sidering the issue and sale of $30,000,000 of first mort¬
gage bonds due 1988.
Proceeds—To refund $18,000,000

Dec.

March

May 14 it

summer

Northern States

Midwestern Gas Transmission Co.

Gas

Pierce, Fenner & Smith.

it plans to issue on or
31, 1958 $3,200,000 of first preferred mort¬
gage bonds.
May be placed privately. Proceeds — To
repay bank loans and for working capital.
(
before

sell

reported that the company is planning
sell $20,000,000 to $25,000,000 of mortgage

Northern
-

Southern

May 19 it

early Fall. Underwriter—To
be determined by competitive,
bidding. Probable bid¬
ders: Halsey, Stuart & Co.
Inc.; The First Boston Corp.;
:Glore, Forgan & Co.; Blyth & Co., Inc.

New Ybfck.7Registra¬
*. X-; "

Inc., Fairfield, Calif.

announced

was

Co.,

Illinois

(par $50).

rities Corp. and

was

issue and

bonds late this

Inik'X-1

★ Lazard Fund,,
:'V:"
May 28 this new open-en.d mutual/fund filed with the
of shares

preferred

stock

bank

are

Probable bidders:
Salomon Brothers & Hutzler.

Gardner

notification, of registration

short-term

may¬

privately through Kidder, Peabody & Co.

Southern Colorado Power Co.
April 21 it was reported stockholders will vote
May 0
on
creating an additional 100,000 shares of

certificates.

Boston Corp.: Blyth & Co., Inc.; Lehman Brothers, Mer¬
rill Lynch, Pierce, Fenner & Smith and Reinholdt & '

SEC

be placed

retire

additional

some

plans to issue and sell

expected to be received by the company for the
purchase from it of $2,340,000 of series D equipment trust

Go., InCft'-Tlie First

Proceeds —To

* Norfolk & Western Ry.

first

bidders:. Halsey,

SEC.

mortgage bonds vdpe 1982.
Underwriter-—To be determined by competjtiyc bidding.
Probable

the

sell

the year.

(7/9)

was announced company

announced

was

by the company that it plans >
bonds during the latter
part of
Proceeds — Together with bank
loans, to be
used for $16,000,000 construction
program.
Bonds
to

•

borrowings.: Underwriter—To be determined by com¬
petitive bidding. Probable bidders: Halsey, Stuart & Co.
Inc.; Morgan Stanley & Co. Bids—Expected to be re¬
ceived on or about July 9.

;

•

May- 15^ it.was annouunced company plans.to. issue and
sell SI 0,000,000 of first mortgage .bonds
diie;l983.". Pro¬

April 7 it

$60,000,000 of refunding mortgage bonds, together with
1,200,000 shares of common stock, par $100 (the latter
to American
Telephone & Telegraph Co.i
This is in
addition to the $70,000,000 bonds
registered on May 2

—

South Carolina Electric & Gas Co.

equity securities later
1959, depending upon prevailing

early

market conditions. Underwriter—For any common stock:
The First Boston Corp., New York.

Underwriters—Blyth. & Co.,. Inc. and J. J^ jCHilliard &
Son.
■"
•'
-■"? "U ' '•
X
"
...

Goodbody

Building.

Co.,

Penobscot

KANSAS CITY,
F.

Smith

Luce,
i

ANGELES,
Calif. — W.
Revely has joined the staff
Paine,
Webber,
Jackson &
Curtis, 626 South Spring Street.
He was previously with Daniel
D. Weston & Co., Inc.
of

Joins Sutro Staff
(Special to The Financial Chronicle)

LOS ANGELES, Calif.—John J.
& Crowe, Inc., Hiney has joined the staff of Sutro
c:+r£»o+
& Co., Van Nuys Building.

now

Thompson
ll+l-i

Mo.—Lawrence
affiliated with

LOS

Fred

The Commercial and Financial Chronicle
44

on
Variable Annuities
decision

potential

A New Fund Is Now
With

engines for the hurling of new

appealed

Freres

Lazard

within

Co.,

venerable

growth category.

It is

will

Co. is to keep a small organi¬
continuous public offering of shares.

thought originally was that the fund would be created for
just their customers and accounts but later a change took place
so the offering will also be open to the public albeit on a limited
The number of shares and the price

have not been disclosed

early date but should be public

information by the be¬

ginning of June since the offering will take place the end of June.

States Supreme Court,

been announced by Lazard Freres that three partners
organization will be directors of the new fund. They are
J. Hettinger, Jr., Richard H. Mansfield and Edwin H.

It has

Sovereign Investors reporting as

in their

April 30, 1958 shows total net
of $2,076,125.77 compared

Albert

assets

Herzog.

with $1,803,683.80 on Jan. 1, 1958.
This
represents an increase of

for the period.

15%

Outstanding

The

net

value

asset

from

Assets Rise

share
1,
April 30, 1958 a

$10.28

1958 to $11.37 on

Putnam Fund

175,377 shares to 182,589
during the same period.
Increased

Mr. Hettinger will also be Chairman and Mr. Mansfield

will be President of the fund.

ahares of the Fund rose 4% from

per

Drug Stocks Seen
Reasonably Priced

Jan.

Drug stocks as
seem
especially

$142 Million

10.6% advance in the four months.
The

of
Boston
reports for the quarter
Two With Walston
ended March 31, 1958 increases in
DENVER, Colo — Ernest D. total net assets from $133,219,000
Sommers and Robert E. Watkins to $142,345,000 and in net asset
are mow
affiliated with Walston value per share from $10.85 <. to
& Co., Inc., Mile High Center.
$11.42. Also during the quarter

Interested
In

ATOMIC

We will be

glad to send

you a

free

Putnam

Fund

market

action

this

time

Development Mutual Fund, Inc. This
•

to 30,057

goods and service industries,

continued

York

offered

continuous

Co;

The Fund's fundamental invest¬

policy is based

ment

the antici¬

reflect

reduced

tain

our

ance

over-all investment bal¬

approximately its present

ratio."
The fund, he added, is in a fa-

both of these fields. The fund

will

orable position —to take portfolio
action as it seems advisable when

and

have the right to make in¬
profit-margin vestments in debt obligations and
squeeze.
The stock market, he
preferred
stocks of investment
said, while down from its high grade of such companies and in
levels, has been extremely selec¬ government securities as defined
tive, and although many security in the Investment Company Act
prices have declined in price, the of 1940. Investments will be se¬
general market level has held lected by the fund on the recom¬
relatively stable during the past mendation of Templeton, Dobbrow
three months.
& Vance, Inc., investment adviser
He said the fund has made only to the fund.
minor changes in its investment
The dividend policy of the fund
account during this period.
"We
will be to distribute substantially
continue to feel that it is prudent
all its net income semi-annually,
policy," he explained, "to main¬ and its net realized
capital gains
volume and

annually.
ital gains

It is expected that cap¬
distributions, unless the
at his option previ¬

shareholder

payment in cash,
paid in shares of
capital stock of the fund.
requests

ously

will normally be

fact appear to be reasonably
priced relative to the market de¬ the business picture can be seen
..." Div*vTheOtft>re
von
Karman,
spite the gains of recent months, in clearer outline.
Chairman of the Board of Direc¬
The quarterly report shows that
according to the May issue of
tors of the fund, is also Chairman
"Perspective,"
a
publication
of the fund's investments on April 30
of the Advisory Group for Aero¬
Calvin Bullock, Lt., managers of were diversified as follows: bonds
nautical
Research
&
Develop¬
and preferred stocks 41.7% and
the number of shareholders and mutual funds with assets in excess
ment,
NATO
(North
Atlantic
common
stocks
58.3%.
Three
shares outstanding reached new of $400,000,000.
Treaty Organization) and Chair¬
The publication said, however, months earlier the ratio was 42.8%
highs of 43,900 and 12,464,836 re¬
man
of the
Scientific Advisory
that this conclusion in part re¬ to 57.2%.
spectively.
Committee of the Allison Divi¬
The fund added Stop & Shop,
The total market value of all flects the underlying premise that
sion of General Motors Corp.
<
Transcontinental Gas Pipe
the Fund's, investments on March a new bull market is not in the Inc.,
Andrew G. Haley, President and
31 exceeded cost by $22,643,000, an makipg, for drug stocks are not Line, U. S. Steel and U. S. Rubber
to its common stock holdings,
lt a director, is a partner in the
increase of $6,312,000 since year likely to keep pace with the rest
D. C. law firm of
also made a 10,000-share preferred Washington,
end.
Common stocks represented of the market in a period of sus¬
stock purchase of Northwest BanHaley, Wollenberg & Kenehan;
61% of the Fund's total invest¬ tained economic growth such as
that witnessed from 1954 to 1956. corporation, and bought $500,000 President of the Interaational Asment, compared with 60% on Dec.
tronautical
Federation; General
The feeling on the part of in¬ of Sylvania Electric Products 4.5%
31.
Counsel,
American Rocket So¬
bonds.
Commenting on the present pe¬ vestors that drugs are not subject
ciety; President and a director,
cyclical fluctuations to the
riod as "a time for constructive to
Missiles-Jets & Automation Man¬
same degree as many other groups
action
rather
than
for
sitting
agement Co., which will supervise
has been one of the factors mak¬
tight," George Putnam, Chairman
the business affairs of the fund;
drugs
relatively
attractive
of the Trustees, stated that cur¬ ing
and co-founder and former Presi¬
rently the management is "aggres¬ during the past six months. Cur¬
dent of Aerojet Enginering Corp.
rent
earnings
reports certainly
sively seeking the companies and
Hugh Bullock, President of Bul¬
Other directors of the fund are
industries that will be in the fore¬ afford corroboration of this view, lock Fund, Ltd. reports that net
Bertram M Goldsmith; partner in
front of the next general recovery the publication said. An appraisal asset value per share rose 3.4%
of relative market performances from
Ira Haupt & Co.; Francis H. Crissin business.
$11.16 at Jan. 31, 1958 to
in past recessions, however, is in¬
maiu Vice-President-finance
and
"Many good quality companies
$11.54 at April 30, 1958.
'.
a
director: of Columbia Gas Sys¬
C started their readjustment long conclusive, but nevertheless the
During the quarter ended April
does
persist
that
drug 30, 1958* total net assets of the tem, Inc.; Roy S. Heavner, Vicebefore it was general in our over¬ feeling
President and a director of Tem¬
all economy. These are now in a earnings will be more stable, and company
rose
to $32,854,419 as
.

Bullock

prospectus describing Atomic
fund has more than 75 holdings of

George

do not
vulnerable
to
group

New

derwriting group, will make pub¬
lic offering on June 17 of 500,000

will

29,238, and the number of
outstanding increased to

sumer

has

sales

scale.

this

Co.,

pated long-term growth trend ot
the missiles-jets automation fields.
10,105,275 from 9,793,886.
Its investments will principally be
Mr. Vance noted that the busi¬
concentrated in the common stocks
ness news, except for certain con¬
of the companies engaged in one
shares

The

Haupt

shares of

shareholders climbed

from

there

the present fiscal

Ira

City, as head of a nationwide un-;

basis through Ira Haupt &

The intent of Lazard Freres &
so

the

end of

During the quarter, the number

thought that the portfolio will be managed to have less than
usual emphasis on diversification and more concentration on a
smaller number of individual issues.
^
zation

the

three months earlier.

Lazard Fund, Inc. and is expected
a week or ten days. The Lazard

in the open-end

be considered

Fund will

the

funds into orbit.

managed fund will be called The
to have the '33 Act filing

principle, is once again seeking to
passage of permissive leg¬
islation by the New Jersey legisture.
And, as in the past, the
Metropolitan Life Insurance Co. is
among those vigorously opposing
the proposal. It is expected that
the decision of the Court of Ap¬

three,

per

capital stock of MissilesThe asset value of the fund's Jets & Automation Fund, Inc., at
shares rose to $15.12 as compared a price of $10 per share.5 The new
will become open-end for
with $14.51 for the quarter ending fund
the previous fiscal year on Jan. redemption of its shares approxi¬
31.
Total net assets increased to mately 30 days after the public
offering.
Subsequently,
shares
$152,760,645
from
$142,125,781

offering in mid-June of Ira Haupt

underwriting and internationally known banking firm, yesterday
the first notification statement with the SEC.
The new

eceure

will

these

value

assets

April 30.

year on

filed

variable annuity
by
common

backed

exponent of the variable annuity

United

first

The

asset

net

Haupt & Co. to

New Fluid June 17
increases
share and

reports

first quarter of

William Street

Automation Fund, Inc., at least three
prominence are readying their rocket

net

total

other Wail Street houses of

stock, were not subject to regula¬
tion by the commission. The rul¬
ing came at a time when the
Prudential Insurance Co., primary

peals

Missiles-Jets

Co.'s

Launching Pad

highly successful launching of One

the

Fund, and the scheduled public
&

Fund

Boston

far-

down

the company of

contracts,

Offer Shares of Its

$152 Million

this week by
the V. S. Court of Appeals when
it ruled against the Securities and '
Exchange Commission and others
in favor of the Variable Annuity
Life
Insurance
Co. of America.
The court held that the sale by
handed

was

Ira

By ROBERT R. RICH

reaching importance to both the
securities and insurance industry

„

Thursday, May 29, 1958

Assets Now

Mutual Funds

Against SEC

Boston Fund

F etleral Court Rules

(2432)

Fund, Ltd.

Shares Gain 3.4%

stocks selected from among those

companies active in the atomic ~

field with the objective of possible

growth in principal and income.

lAtomic

Development Securities Co., Inc. Dept
1033 THIRTIETH STREET, N. W.
WASHINGTON 7, D. C.

position

ahead

move

again.

Other well-managed concerns are

there is

reason

this

contest

opinion.

the base for future profits."
New common stock additions to
the Fund during the quarter in¬

earnings are con¬
sidered to be "too optimistic" to
be used as a guide for the year
as
a whole, particularly in view
of the difficulty of matching the
fourth quarter of 1957, "Perspec¬
tive"
estimated.
Therefore, the
study said, an increase of 5-10%
in earnings for 1958 would seem

cluded

coming through the recession in
fine fashion.

These include many

drug companies, food chains and
electric utilities.

present period

tunity and

We look

as
a

one

the

oppor¬

time to establish

Avon

reasonable

estimate

for

Products,
Inc., Denver & Rio Grande West¬ the year.
"The
current
market
values
ern
RR.
Co., Fibreboard Paper
Products
Corp.,
General Foods 1958 earnings of that magnitude
Corp., Houston Lighting & Power at from 14.5 to 15.2 times, which
Co.,

Peoples

Water

Gas

Co.,

Rich's, Inc., and State Loan & Fi¬
nance
Corp., Class "A" (acquired

although higher than the average
of the past 10 years, does not seem
out

order.

The

present

rela¬

through conversion of debentures). tionship of drug stocks to the bal¬
Share
eliminations
included: ance of the market, while much
14,500
Aluminium, Ltd., 17,500 more favorable to the drugs than
in the period from 1954 to 1956,
Chase
Manhattan
Bank,
18,000
Chemical Corn Exchange
Bank, appears in line with the record
20,000 Continental Oil Co. (Del.),
7,000 First National City Bank,
N. Y., and 9,000 General
Dynamics

Corp.
your

Investment Dealer
&

HOWARD, Incorporated

24 Federal St., Boston, Mass.

With First Southeastern
COLUMBUS, Ga. — Ruth A.
Connelly has joined the staff of
First

from 1948 to 1953."

$32,553,824 on Jan. 31,
now
constituted, Mr.
said, the fund's portfolio
to possess reasonable de¬

Bullock

appears
fensive characteristics

continued

long-term

po¬

tential, and existing dividend in-"
come
appears
protected for the
After

Southeastern

Fourth National

Corporation,
Building.

Bank

DENVER, Colo. — Mrs. Alma P.
has joined the staff of

Co., First Na¬
tional Bank Building.
Mrs. Gor¬
den was formerly with Columbia
Securities

Co.

Wyoming.

*ln

than

single transactions
$10,000.

involving

careful

consideration, he

was determined that there
neither necessity nor oppor¬

was

tunity at this time to effect fun¬
damental changes
in the fund's

portfolio.
It continues to stress
corporations appearing to have
unusual growth potential, which
include

some

rations in

country
companies in

smaller

considered
tronics

largest
drug

of the largest corpo¬

the

and

fields

such

guided

investments

well

were

114

elec¬

missiles.
in

The
the

and medical supplies group

by petroleum

and the chemical group

Harry W. Peters Adds
(Special to The Financial Chronicle)

GRAND

FOUNDED 1929

carefully

(10.14%).

Gorden

Dobbrow & Vance, Inc.;
Landis, attorney and

formerly Dean of Harvard Law
School, Chairman of Securities &
Exchange Commission, and Chair-

said, it

(10.23%)

Amos C. Sudler &

pleton,
James

year.

(11.53%), followed

Joins Sudler Staff

well

growth

(Special to The Financial Chronicle)

Prospectuses available from
EATON

against
1958.

First quarter

JUNCTION, Colo.—
Sidney M. Edmondson has been
added to the staff of Harry W.
Peters, 411 Main Street.

consecutive

quarterly dividend
share from

Ilea
investment

June

30,

income,

net

payable

1958 to stock of

record June

6, 1958.

WALTER L.

MORGAN

President

less

Volume

man

Number

187

5746

Aeronautics

Civil

The Commercial and Financial Chronicle

Board;

William S. Palmer, Vice-President
and a director of Templeton, Dob&

row

Vance, Inc.; Arch C. Scur-

President

lock,

Atlantic

Re¬

Institutional Funds

Dreyfus Funds

Highs

Corp., Malcolm A. Sedg¬
wick, Vice-President - and Secre¬
Jack J. Dreyfus, Jr.,
President,
tary of Home Insurance Co.; Sir
reported for the quarter ended
Robert
A.
Watson-Watt, Chair¬
March 31 that the assets of Drey¬
man of Sir Robert Watson, Watt
and

Partners, Ltd., London, Eng¬

land and
a

Chairman, President and
of Adalia, Ltd., Mon¬

director

treal, Canada.

fus Fund

Fundamental Slirs.
To Be Available

stocks.

common

technical

his

conditions

have

March

the

all-time

high

fund

reached

the

end

$18,398,901 as com¬
$15,231,324 for Dec. 31,
Rowland A.; Robbins, Chairman
1957. Shares outstanding was also
of : First
Investors' Corporation,
a record and reached
1,999,681 at
(FIC) announces a new FIC con¬ the end
pared

tractual plan for the accumulation
of shares of Fundamental Inves¬

pared

tors, Inc.,

the

stock mutual

a common

fund.

•

'•

Necessary registration
issuance

cover

FIC

•

papers

Plan

Cer¬

agreed

pay¬

calling

ments of

$50 million will be filed

with the Securities and Exchange

Commission before the end of this
month.

Contractual plans for

the

quarter

$1,792,986

Net asset value

quarter

For

the

com¬

Dec.

for

first-

than

Bendix

VI/

Wellington
Investment

Mr. Robbins stated

that for the

first

adopting

from

the

portfolio

j'.-l'i

(Fundamental Investors).

Bond

Total

net

assets

Investors

managed

Investors

Di¬

versified

the

Board,
asset

Fund

the

report.
per
share

value

was

announced

semi-annual

Net

Fund,

erally

guaranteed

much

the

Committee

for

loans

$700,000,000

$12.71

April 30,

1958, compared with $11.69 on Oct.
31, 1957. Dividends declared dur¬
ing the period amounted to 21

derived

were

entirely

in¬

from

This represents an increase vestment income.
New
highs were
reached
in
3.5% over the Oct. 31, 1957
number of shares outstanding and
year-end figure of $6.25.

funds

the fund's semi-annual report,

to¬

to
in

rose

from $18,855,312

$19,397,668. Dividend payments
past 12 months amounted to

34.5 cents

share;

Brady, Jr.
President Hugh W.Long, make

Chairman Wm. Gage
and

the point that, "During the period
under review, the fund's manage¬
ment has continued

its long-term

shareholder accounts. Shares out¬

standing increased from 19,908,528
Oct. 31, 1957 to 22,032,798 on
April 30, 1958. Number of share¬
holder accounts grew from 94,656
to 102,802 in the same six months.
on

Common stocks and

equivalent
equities at the end of the six
months under review comprised
all

2.34%

but

vestments.

which

the

ber and

suitable

bond

issues

investments
become

were as

available

prices considered attractive.
The percentage of assets invested
in

utility and industrial bonds has
doubled in the past several

been

such bonds now comprise
approximately 50% of the fund's

years;

total assets."

A. G. Becker Adds
(Special to The Financial Chronicle)

CHICAGO, 111.—John E. Dwyer,
Jr. has been added to the staff of
A. G. Becker &

Co. Incorporated,

South La Salle

and

the

Industry

augmenting the num¬
investments
proportion of utility and

program of

industrial

Fund
as

in¬

in
larger

groups

its

April

30,

1958

follows: Petroleum, power

light,

casualty

3911

•

the

Kenneth Stucker Adds
M

Invest¬

Administrative

Fund, Boston
Research Co.,

Inc.

(Special to The Financial Chronicle)

MIAMI

SHORES, Fla.—William

Greene

has

range.

been

added

the

.
: , ■
staff of Kenneth B. Stucker In¬
McLaughlin is also Senior
vestment Securities,. 9822 North¬
Partner
of
McLaughlin
Bros.,
J
;*;■
Chairman of the Board of Direc¬ east Second Avenue.
-

>...

Mr.

tors, C. J. Maney Co.," Inc.; and
been

Moreover,

kept

the

approach

things
less
of

the

rank

and

file

fire
and
and electric
equipment.

chemicals,

Joins

the

collateral

Ahother
the

ordinary
they do not

pledge for

With payrolls

cases.

item

Post

the

was

Office

sugges¬

Department
for
mail

regulations

financial

burdens
.

In its

PETERSBURG, Fla, —Wil¬
J.

Shaar

west Stock Exchanges.

Drive, No^th.

with

Jobin

also

proposed

clarify

of the present law de¬
signed to prevent discrimination
against interstate or foreign ship¬

so-called- "private carriage" sec¬
tion of the law to prevent com¬
mercial
shipments
under
its

ilong

digest the.

to stand aloof and

cat jumps

the

which way

see

after the Treasury

is out.

news

Evidently there is

enough un-.
certainty still in the air as regards
Treasury plans to explain the let-,
down in interest generally.
The,
guessing was going on right up to
the last minute.
And
ago,

of those

some

who,

week

talking in terms of $9

were

billion of 1-year and maybe 5-to-7

obligations,

year

there

feel

now

outside x chance

that
that

Secretary of the Treasury, Robert
B. Anderson may be tempted to
terms. The change would prohibit try at least $1 billion of long-term
anyone
not directly engaged in bonds.
transportation from transporting
Would-Be Buyers Balky
property by motor vehicles unless
The temperament of large-scale
the transportation was furnished
currently became evi¬
in furtherance of a business project investors
dent
when
prices were set for
other than transportation.
Gas Pipe Line
The bill also proposes the crea¬ Transcontinental
tion of a three-man study group Corp.'s new bonds and preferred
•

the

present time,

particularly in
With the holiday

railroad traffic.

ganizations will be focusing their
attention early next week on two

big issues,
handled

Also, give the Interstate Com¬
Commission authority
to
authorize discontinuance, curtail¬
ment or consolidation of unprof¬
itable
For

services

and

other forms

facilities.
of

transporta¬

of which will be
competitive bidding
negotiation,

one

and the other by

Unless

change

there

plans

last

minute

Consolidated

Edison Co. of New York Inc., will
open

merce

out of the way

underwriters and their dealer or¬

expenses,

interest

Two Big Issues

view of the current low volume of

bids

million

new

ing bonds.

Sale

Tuesday -for
$50
first and refund¬
of this

issue will

for
complexion of things in the paying off short-term bank loans
and
financing
its
construction
corporate new issue market ex¬
perienced little noticeable change program.
On Thursday bankers are slated
during the past week. As one
observer put it, the market has to bring to market for Owenscontinued
to
fiddle
and
faddle Illinois Glass Co., an issue of $50
while waiting on the Treasury's million of new debentures having
outline of its current refinancing a 30-year maturity. Out of the
put

the

big

utility

funds

The

tion, it urged that rail, air, barge
and truck carriers be permitted program.
establish

construction

for the

reserve

purchase or recon¬

ditioning of equipment and other

the fund.

ST.

some

upon

working capital
outstanding debts.
A limit of $150,000,000 would be
placed on loans for operating ex¬
penses
and interest on existing
obligations.
ating

and

Nolting, Nichol & Company, West
Garden Building.

liam

bill, the Committee made

facilities.

With Jobin & James

been

following recommendations:
Authorize up to $700,000,000 in
Government guarantees for loans
to finance new equipment, oper¬

PENSACOLA, F la. — Bert H.
Creighton has joined the staff of

(Special to The Financial Chronicle)

has

the

funds

(Special to The Financial Chronicle)

This

hauling which have been attacked
by the railroads as
imposing

Nolting, Nichol

products.

time.

which

Meanwhile, new corporate of¬
ferings have been grinding along,
moving out gradually but with
institutional buyers still of a mind
the

highly controversial issue for

the

at high levels, some of the rails
might run into difficulty in hav¬
ing enough cash for day-to-day
operations. Some of the larger
carriers have sought to establish
stock this week.
revolving bank credits, but so far to conduct an 18-month survey of
Both these issues reportedly had
have not been successful, accord¬ transportation policies.
Most rail officials, as well as been well spoken for in advance
ing to most reports.
members of the Interstate Com¬ of public offering. And there was
The Senate Commerce Commit¬
a general disposition to look for a
merce Commission, have expressed
tee
also
recommended
that the
themselves as pleased with the fast operation since this was a
Senate Finance Committee, which
proposals. Naturally, some of the negotiated undertaking.
has
jurisdiction
over
taxation,
rail men do not feel the Bill goes
But fixing of a 4.68% yield for
vote
to
repeal the 3% tax on
far enough, but is a start in the the bonds and 5.70% on the senior
freight charges and the 10% tax
right direction. The Government stock made the prices a little
on passenger fares.
Also, it urged
loan section is looked upon as a richer than some buyers had been
a 20-ycar
depreciation period for
stop-gap which could be impor¬ led to anticipate, according to
railroad equipment.
tant to many of the railroads at conjecture in the market place.
r

insurance,

and electronic

James Investments

Fund's

held

Street, mem¬
bers of the New v0rk and Mid¬
120

aid

from

addition

them.

tal net assets

Director

sections

obtain

severe

earnings and continued high ex¬
penses, working capital and cash ments arising from rates charged
have dropped sharply. This is par¬ within the borders of a state.
Another item would revise the
ticularly true of the carriers serv¬

covered

Fed¬

In many cases, because of lower

year.

the period

Senate

industry.

modernize

During

elected

tural

Commerce

1958 fiscal

Currier

& Co. and in the past was an of-

ment Adviser to the

recommendation

tion

of the first half of the

Weiss, President of the.
Arlington National Bank, also was

Of
great
importance to
transportation industry is the pro¬
posal to limit the exemption given
motor
carriers
hauling agricul¬

mutual fund investing
of

Woolrych

Fifth Avenue.
Mr. Hudgins was
formerly with Francis I. du Pont
l'icer of R. E. Evans & Co.

long last it appears that some
aid might be granted by
the Congress. Perhaps one of the
most important proposals is the
railroad

loans in most

Fund, Inc., mutual fund af¬

filiate

the

Higher

Calif. —Herbert

Karl E.

Railroad Legislation

have

Inc., a
exclusively cents per share, the same amount
bonds, reports a net asset value as was declared for the corre¬
$6.47 per share on April 30, end sponding period a year ago, and

Manhattan

Boston,
meeting of

give

sources.

At New Peak

Fund's

Asset Value

annual

check

Fund Assets

Manhattan Bond's

Inc., at the
shareholders.

Fund

have

sections of the country. Most
of the roads do not have the credit

Investors Stock

contractual

fund

Fund

ern

Services, Inc., stated at
plan, providing market value of securities invest¬
for
monthly payments
for ten ments, rose from $232,757,246 as
years, will|have a choice of having of Oct. 31, 1957 to a record high
their investments made in either of
$280,032,807 as of April 30,
a
balanced fund (Wellington); a
1958, up $47,275,561 for the first
fully administered fund (Mutual half of the current fiscal year,
Investment); or a common stock Joseph M. Fitzsimmons, Chairman
FIC

Bank

ing the Mid-East and North East¬

Stock

investors

time

Fund' and

surance

Aviation, Bethlehem Steel,

Corporation, or¬ were Minnesota Mining, Superior
ganized in 1930, specializes in mu¬ Oil (Calif.), Pepsi-Cola, P. Loriltual funds and investment plans. lard and U. S. Treasury Bills.

funds, namely,
The
Fund,
and
Mutual
Fund, Inc.

Income

DIEGO,

C. Hudgins has become associatedl

with

forthcoming Treasury proposition.

Eliminated

half billion

the

SAN

narrow

ter, accounting for $4,081,630 or
54% of the total. Institutional In¬
come
Fund, Foundation Fund, In¬

Cement, American Airlines,
Atchison, Topeka & Santa Fe,

First Investors

one

(Special to The Financial Chronicle)

elected to the Board of Directors

land

stock funds in the country.

plans for the accumula¬
tion of shares of two other mutual

the sales leader for the first
quar¬

Bank

Allegheny, Ludlum, Alpha Port¬

as¬ way, Tri-Continental (Warrants),
$350 million. It is one U. S. Steel, Vanadium Corp., and
of the largest and oldest common
Youngstown Sheet & Tube.

tractual

was

Savings

Boston, and George A. McLaugh¬
lin, formerly a Director of the In¬
vestment
Adviser,
have
been

Hudgins With
Woolrych & Currier

Memorial Day holiday which will

offered

dollars under First Investors' con¬

Institutional Growth Fund

Union

President

Dreyfus

over

slightly less than

industry, Mr. Jamieson said.

the

Carolan,

week-end

the

Payments
already
made and
payments to be made amount to

Company.

Fund made portfolio purchases in

90,000 shareholders and

sets of

$474,179 or 6.3% of sales, com¬
pared to 27% of sales reported by

year.

quarter,

President, Treasurer and Director,
National Dock and Storage Ware¬

H. C.

$9,201 for
against $8,494 at

Brunswick-Balke, Dow Chemical,
Eastern Airlines, Fansteel, Lehigh
Portland Cement, Liggett & Myers,
to the public as soon as registra¬
National Cash Register, National
tion becomes effective.
Gypsum, Penn - Dixie Cement,
Fundamental Investors, Inc., or¬ Quaker
Oats, St. Regis Paper,
ganized in 1933, now has more Southern Pacific, Southern Rail¬
will

Investors

institutional

$7,518,396 for the
quarter of 1958,
up
35%
over the same
period in 1957, H.
L. Jamieson, President of Hare's
Ltd., the national distributor, re¬

the

or¬

31.

accumulation of shares of Funda¬

mental

five

rose

the beginning of the

tificates

for

the

Repurchases
of
Institutional
Fund shares of the period totalled

."7
assets

totalled

first

ported.

present economic condi¬
still leave much to be de¬

—Net

Sales

Funds

even

corrected

,■

William

seem

been

the balance in that

J'y-

Income Fund of Boston

con¬

though
tions

In Share Sales

which

sired."

Contractual Basis

view, the

der.

On Directorate of

1957 decline

tributed to the
to

90% invested in

are now

made up

house

Assets, Share Value Report 35% Rise
At New

(2433)

The effect would be to

proceeds the company will re¬
tire $15,266,000 of National Con¬
today (Thursday), to give tainer debentures, plus $20 million
the details of its plans for taking of
short-term
loans,
and
also
The Government's financial arm

due

care

ties

some

$9 billion in maturi¬
It also has an¬

bolster its working capital.

mid-June.

Three equity offerings finish off
plans for taking up an the week's calendar. Pennsylvania
additional $4 billion, but this is Power Co. on Tuesday is seeking
Add to the Interstate Commerce
Act a section providing that in expected to go over until late in bids for 60,000 shares of preferred.
the summer.
On
Wednesday
Texas
Eastern
areas
where
different types
of
Corp. will market
The Treasury market has been Transmission
transportation are in competition,
$25 million of preferred stock and
the rates of a carrier shall not be wallowing along and the seasoned
held up to a particular level to corporate
market,
though gen¬ on Thursday Florida Public Utili¬

defer

taxes

money

nounced

Inc.*, 242 Beach protect the traffic of
mode of

paid into

transportation.

any

other erally
no

firm,

has

disposition

shown

to break

little or ties Co., is offering 23,500 shares
out of a of common.

The Commercial and Financial Chronicle

*46

.(2.434)

The following statistical

Indications of Current

latest week
week

Business Activity
operations

Indicated Steel

Week

INSTITUTE:
capacity)

(per cent

castings

and

ingots

(net tons)

June

—*—

Ago

CIVIL ENGINEERING CONSTRUCTION

2,252,000

1,289,000

April
Total

and condensate

oil

Crude

May
May
May
May

r—

—.

—

(bbls,)

stills—daily average

runs

16
16

Gasoline output (bbls.)
—
16
Kerosene output (bbls.)
—
16
Distillate fuel oil output (bbls.)
May 16
Residual fuel oil output (bbls.)
—
May 16
Stocks at refineries, bulk terminals, in transit, in pipe linesFinished and unfinished gasoline (bbls.) at—
May 16
(bbls.)

Kerosene

fuel

oil (bbls.)

Revenue

(bbls.)

6,250,535

7,051,000

8,131,000

25,416,000

24,531,000
1,918,000

27,057,000
1,875,000

11,650,000

1,568,000
11,130,000

10,901,000

13.003,000

6,558,000

6,651,000

6,495,000

Public

7,511,115

7,255,000

1,881,000

201,235,000
19,114,000

80,771,000

78,287,000

73,060,000

59,503,000

59,120,000

56,794,000

17,537,000

construction

—-May 17

560,765

535,204

498,017

495,748

493,515

State

and

Federal

$435,399,000
200,517,000

346,946,000

113,512,000
212,221,000

May 22
May 22

206,906,000
140,040,000

234,882,000
181,550,000

May 17

7,170,000

May 22

municipal—

—!

165,987,000
46,234,000

*6,250.000

7,080,000

inc.

Finished steel

390,000

Electrolytic

(e.

138

125

11,206,000

Louis)

Zinc

(New York)

$64.56

$31.83

$47.17

24.425c

24.550c

23.675c

31.300c

21.725c

22.075c

21.775c

29.050c

Durable

11.500c

12.000c

15.000c

Nondurable

11.300c

11.800c

14.800c

10.500c

12.000c

10.000c

11.500c

Payroll

24.000c

25.000c

94.375c

94.625c

93.000c

98.000c

All manufacturing
Estimated number of

96.19

96.24

96.56

88.69

96.23

96.07

96.23

102.80

102.96

Industrials
moody's

99.36

99.52

100.00

yield

95.62

96.23

95.77

May 27
—May 27

91.62

—May27

—

daily

95.77

FACTORY

97.78

97.94

96.07

99.36

99.20

99.04

95.77

2.82
3.99

4.00

3.99'

All

4.06

3.56

3.58

3.57

3.79

3.78

3.75

3.85

4.03

3.99

4.02

4.60

4.62

4.66

4.56

4.30

4.32

4.30

3.89

3.88

moody'S commodity index

May 27

403.0

400.7

national paperboard association:
Orders received (tons)..
1

May 17

240,015

May 17
Mav 17

269.356

;

Percentage of activity,
Unfilled orders (tons) at end of period

ESTIMATE—U.

389.4

411.9

285,090

230,130
263,614

348,231

383,220

336,737

109,87

109.91

109.99

;

73.53

38.5

40.8

♦39.1

$2.10

$2.1C

2.24

"2.24

2.18

1.95

1.92

i.87

$30,249

*$30,62/5

$30,961

;

22,212

*22,286

21,957

$52,461

*$52,911

$52,918

—

COMMERCE)

Month

—

NEW

(millions

February

Inventories—

'»

dollars):

.'J.

;

—

Noiidurables

Sales

25,593

—

1,600,480

210,960

287,560

1,274,380

1,333.040

886,960

1.301,700

1,630,300

1,692,330

1,097,920

1,589,260

Banks

320,090

241,250

339,970

23.130

474,940
49,700

22,850

402,890

298,250

305,850

327,800

452,590

321,100

Number

578,840

348,350

582,304

151,680

56,600

729,040

648,942

325,255

887,280

800,622

381,855

"
May
-May

2,439,529

2,676,990

1,599,550

Dollar value

290,410

Other sales

•;

2,242,818
2,668,768

1,800,875

Number of

1,268,858

>5,162,385

1,055,385

1,111,269
18,467

18,847

17,893

1,092,802

1,082,487

793,753

1,174,170
7,406
1,166,764

46,921,729

$46,137,901

$35,334,040

$59,467,289

323,620

290,380

207,870

954,350

938,685

■620,829

207,795,213
114,816,119

201,174.403

212,328,639
101,604,819

1,101,334

811,646

275,253

261,069

59,802

1,941,152

issues—

1,795,648

'2,109,411

(DEPARTMENT OF COMMERCE)—Month "
March (in billions):
(
$341.4

.*95,3

63.7

industries

*64.3

——

Government
•"

f
•

Other labor income

Proprietors and

7.7

7£

51.3

290,380

207370

307~750

490.220

May

510,660

424,410

454,620

rental income—

31.8

dividends-^-

—

12,872,970

1,000,750
13,325,820
14,326,570

552,490

524,130

8,488,750
9,041,240

11,8^0,590

12,414,720

u. s. dept. op

PRICES

RECEIVED BY FARMERS

farm

products

•

20-0

OF
of

—

6.E

6.8

324.6

*325.2

324.5

INDEX

AGRICUL-'
March

15:'
*

263

Commercial

252

grains

Food

grains

hay
——_L_:——:

and

Potatoes

224

N—

119.3

119.5

119.4

97.3

*98.6

97.5

89.7

-May 20

113.0

*112.8

111.4

105.3

May 90

115.4

114.4

110.7

91.7

125.4

125.7

125.2

foods—II——May 20

125.2

200

272*
475

Daiyy
Meat

products

and

237
265

148
-

273

459

238

266

260

324

261

263

.
—

animals

Poultry

475

•

280

—!__

_—

204

LivestoclT

235
-

229
'

117.2

May 20

.181

219,-

228
234

—:

—

252

148
"

—:

——

252

211

152

—

237

376

220

Feed,

238

•

229

396

vegetables, fresh

AH commodities other
than farm and

DEPT.

—

Oil-bearing crops

Commodity Oroup—

Ijocessed foods

7.8

51.1
30.9

23.5

244

12,029,740

—

39.3

;

special in-,..

Total nonagricultural income.—:——i—

All

_L.May

32.6

31:8

24,1

__i

TURE—1910-1911—1(H)—As

—_——..May

(1947-49 —100):

NUMBER —U.

843,230

i_i

63.0

*51.0

6.8

32~3~620

Other sales-

102.3

40.5

contribution.for

employees*

40.5

—:

Personal interest income and

Less

34.3

————J

—_.—

237.2
.

*34.3

______——__

—

$340.2

♦234.4

94.8

___^

*$341.7

233.3

personal income—

Wage and salary receipts, total
Commodity producing industries
.* Distributing industries — _i—

May

Total sales

111,605,160

Total transfer payments

May

Mav

•

187

—_i

eggs

336
,

150

169>

229

249

1,009,754,000

963,636,000

274

926,000

barrels of foreign crude runs. §Based on new annual capacity of 140,742,570 tons
1058< as against Jan.
1, 1957 basis of 133,459,150 tons.
tNumber of orders not reported since introduction of
?Pnme Western Zinc sold on delivered basis at centers where
freight from East St.-Louis exceeds
one-haif cent'a pound.

Total

307,750

y
Mav

TOM TOUND-LOT STOCK SALES ON THE N. Y.
STOCK
EXCHANGE AND ROUND-LOT STOCK TRANSACTIONS
IFOR ACCOUNT OF MEMBERS
(SHARES):
Total round-lot sales—
Short sales

/lSJre'

110,741

312.395

•

$69,649,842

Mav

$2,681,734*. : $2,741,225
28,064
101,741
313,450
311,811

$2,776,150

Market value of listed shares!-—„l_____
Market value of listed bonds!!—"—_—

Service

on
Total of

4.16

accounts—

balances—_

debit

customers—_—...—>
hand and in banks in U. S
—
customers' free credit balances— ■

Cash

2.92

4.50

Member borrowings on other collateral— -

1,356,428

$45,075,900

net

4.61

3.08

4.35

omitted):

margin

carrying

firms

r ■

4.71

3.08
..

—

series

1,307,769
$54,737,326

31. (000's

March

customers'

Member borrowings on U. S. Govt,

•

Mav

shares™

wholesale prices, new
LABOR

Total

—

EXCHANGE—

4.82.

4.76

—.—

(200)
STOCK

6.31

4.54

PERSONAL INCOME IN THE UNITED STATES "
;

Round-lot purchases by dealers-

425,950

1,510,465

Mav

.....

——

—

3.96

6.92

4.46

—«

(10)

4.35

6.38

(24)__

Credit extended to

2,522,754

560,670

2,384,872
2,945,542

2,845,380

——Mav

Round-lot sales .by dealers—
Number of shares—Total sales—
Short sales

,f^n

754,108

537,290

Mf)V

Customers' short sales—
Customers' other sales—
Dollar value

635,268

.May

COMMISSION:

Odd-lot purchases by dealers (customers'
sales)—
Number of orders—Customers' total sales

—

4.19
————

(15)

YORK

NEW

118,840

-May

EXCHANGE

f r

__—

—

Average

by dealers (customers' purchases)—t

(125)

Railroads

325,400

579,159
158,240

2,308,090

SECURITIES

Industrials

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDLOT DEALERS AND SPECIALISTS ON N. Y, STOCK
—

29.534

*26,350

19,550

304.670

April:

(25) »
Utilities (not incl. Amer. Tel. & Tel.)

Mav

—

EXCHANGE

'1,009,950

359,290

—May

Other sales

Odd-lot sales

STOCKS—Month

COMMON

100

1,623,210

Meipber

Short sales

sales

YIELD

AVERAGE

355,920

Mav

—

Total

WEIGHTED

1,540,280

—May

—

$2.05

SERIES—

Durables

MOODY'S

-May

Total round-lot transactions for account of members—
Total purchases

<40.1

*38.0

110.35

___Mav

Other sales

75.12
V

"38.4

*38.1

L—
:_—

Mav

•

88.94

38.. 1

goods;

Insurance

sales

$32.21

38.8

May

*73.15

;

^'r£

MANUFACTURERS' INVENTORIES AND SALES

the floor—
_

$80.04
*86.46

86.91

$80.85
!

—

Mav

Other transactions initiated off the floor—
Total purchases

16,933,000

423,348

May.

—.

""6,957,000

Nondurable goods

May

Other sales
Total sales

Total sales

9,976.000

6,723.000

i«<.

All manufacturing
Durable

286,720

May 23

—

Total purchases
Short sales
—!

Short

*8,670,000

105.3

-364.3

Hourly earnings—

255,800

264,699

DEPT.

v.;"-

Durable goods

4.02

transactions for account of mem¬
bers, except odd-lot dealers and specialists:
Transactions of specialists in stocks in which registered—

*10,598,000

'■

Nondurable goods

4.00

3.81

March:

round-lot

Other transactions initiated

*145.1

All manufacturing

4.14

•

May 17

oil, paint and drug reporter price index—
1949 • average = 100
;_

Other sales
Total sales

143.3

6,676,000

manufacturing

(DEPT.

(tons)—

sales

93.8

8,731,000

i'.

—_—_______u.

Nondurable goods
Hours—.

3.79

May 27

—t

purchases

5,392.000

,*95.3 :/• A

/.It;

employees in fhanai'ac-

Weekly earnings—

3.46

2.80

2.82

3.80

Short

7,693,000

*5,150,000

15.40 7,000

LABOR—Month of

3.79

Total

m3,085,000

*6,634,000

EARNINGS AND HOURS—WEEKLY

AVERAGE

May 27

Production

*$11,784,000

6,508,000

:•'« '

;

87.99

May 27

—;

$11,607,000
■

looi—t

Avera-ge-

=•

93.97

May 27

Group

13,151,208

(1947-49:Avfe.= 1(10)—

goods

86.65

May 27

——

Railroad Group.
Public Utilities Group
Industrials

124.2

5,099,000

<1947-49

91.62-'

__May 27
May 27
May 27

________

Baa

indexes

91.34

4.02

•

110.5

127.0

goods
indexes

Durable goods

Aaa

SERIES—Month

goods

87.18
,

Government Bonds.—_—
Average corporate—

122.9

416.6. '

•

Nondurable

averages:

U. 8.

98.41

Group—

bond

136.4

117.0

128.C

40'880,378

(production'"workers)'_

All manufacturing
Durable goods

99.36

.2.

J!.

All manufacturing

95.16

103.13

_____May 27
May 27

Group-—

125.2

141.9

128.3

127.2

LABOR—REVISED

manufacturing

Employment

127.9

142.3

92.2

March:

All

175.8

DEPT.

PAYROLLS—U.

EMPLOYMENT AND

135.1

185.4

bales)—J--—--:—-I-

(running

report

138.5.

185.9
128,0

———.

OF COMMERCE):

(DEPT.

$66.49

87.45

Utilities

GINNING

5.967c

$66.49

Final

127.6 !■

92.0

—;tr.;
-

99.3

129.5

91.9

services

and

5.967c

—May 27

—

Aa,

Public

5.670c

recreation

goods

;

98.8
.129^

$32.67

May 27

;

108.8

turing industries—

—

106.8

—Lli'l

;

May 27

;

Railroad Group

care

May 21

—

106.8
109.0

104.9
126.2

138..7.

$34.00

5.967c

averages:

corporate

Aaa

-...Y.... —!Y,Y

_-J..L

May 21

at__

moody's bondjpricek daily
u- S. Government Bonds—_—

104.9

129.9

...

May 21
May 21

139.2

103.9

;

May 21
—

112.4

108.9

girls'

■;

134.4

115.-9

137.2

:: >

..___!

and

(primary pig. 99%) at

Straits tin

and

apparel

May 21
May 21
May 21

137.C

130.7

care

Other

309

329

•

(East St. Louis)

Aluminum

Average

116.1

111.6

115.9

L—'-j? '-'*

.124.9:

127.3,.'

136.7

boys'

Personal

j. quotations):

JZinc (delivered)

and

Other

COTTON

Export refinery at_.
(New York) at
(St.

327

124.4
V 111.3

127,5

;

*!_•_

operation

$66.49

May20
May 20
Ma y 20

Lead

3.13.8
"

oil—2_i_L__v_—__ '

fuel

and

Reading
337

110.7

137.1

electricity

Footwear

dun &
—May 22'

100.6

106.8

11,574,000

—

129.8

112 X)
,

111;4' ^

.-114.5

J.30.7 : *
'

113.2

117.2 '
132^

114.1,.

129

11,257,000

prices#-

,;v

;j
"

————

Public
127

(per lb.)

refinery

home

fuels

Men's

copper—

Domestic

;

118.9

-118.7 ".

'■

114.4

r.„

iC?'

-s' 132.7

Transportation

11,316,000

Pig iron (per gross ton)
Scrap steel (per gross ton)_
metal prices

vegetables-Y!_'____*_*-_

Household

509,000

396,000

*--122.5 " '

iV.

119.6

_!_!_—!_

Medical

composite

age

iron

and

Housefurnishings

9,519,000

——May 17

—

123.3

bakery

foods

Solid

49,038,000

May24
industrial)

reserve

kwh.)

(commercial and

bradstreet,

and

Other

edison electric institute:

failures

»!.•/

Housing

145,041,000
96,003,000

53,332,000

385,000

May 17

Pennsylvania anthracite (tons)—

Electric output (in 000

home

Women's

(u. s. bureau of mines):
coal and lignite (tons)__

department store sales index—federal
system—1947-49
average «=w 100

1917-49= 100—

—

products^-—'.'—s.:
Meats, poultry and fish—
.'_!
Dairy products

coal output
Bituminous

184,576

"■i

'.{•

•

Cereals

$338,914,000
193,873,000

$325,733,000|

May 22

—May 22

—

543.762

160,712

Rent

$588,107,000
241,161,000

—

construction

Public

619,384

—

Gas and

construction

Private

728,338

588,502 ;

120B>
Food

news-record:
Total

*731,781

780,096

•181,466

March:

$1,460,119

617,595

769,968

$1,397,691

813,337-

items

engineering

—

$1,583,305
;:

INDEX

Ago

municipal

PRICE

Month

All

•«.*..

—

CONSUMER

722,144
614,070

534,475

cars)—May 17

*••«.*

Year

Month

—

196,383,000
22,854,000
86,830,000
39,426,000

211,030,000

and

Federal

;

198,307,000
20,306,000

Month

—

construction

State

7,798,000

Previous
-

EN¬

—

construction

Fruits

freight loaded (number of cars)
freight received from connections (no. of

engineering

civil

*6,249,685

6,261,885
*7.479,000
25,200,000

american railroads:

association of
Revenue

May 16
—May 16
May 16

—

oil

Distillate fuel
Residual

(000's omitted):
S, construction

Private

output—daily average (bbls. 01

gallons each)—_____—

NEWS-RECORD

of that date0

are as

Month

american petroleum institute:
Crude

of quotations,

cases

either for th^

are

Latest

88.0

47.8

"1,523,000

§1,526,000

or,

GINEERING

Equivalent to—
Steel

that date,

production and other figures for tife

cover

Dates shown in first column

Year

Ago

*56.4

§56.5

June

month ended
Month

Latest

AMERICAN IRON AND STEEL

tabulations

month available.

Thursday, May 29, 1938

WINTER

WHEAT

PRODUCTION—CROP

PORTING BOARD U.

RE¬

S. DEPT. OF AGRI-.

CULTURE—As of May

(bushels)

707,201,000

187-

Volume

Number 5746

The Commercial and Financial Chronicle

(2435)
DIVIDEND NOTICES

DIVIDEND NOTICES

GEORGE

AnacondA

CALIFORNIA-PACIFIC

DIVIDEND

200

NO.

DIVIDEND NOTICES

:;>

UTILITIES COMPANY

May 22. 1958

The Beard- of Directors of

-has today declared a
of

on,

the par

ite

.dividend*,

payable

-June

closa

record

business

following rates

share, "
1958,

per

26,

stockholders of

the

1958,. have been declared

capital stock of-

value of $50

5% Preferred

;

•

were
declared, payable
stocjchold
of record at the
12, 1958.

July

1958,

close of

company

53rd Consecutive Dividend

DIVIDEND NO. 176

J. NEUMANN, Secretary

share has been declared

The

the

capital stock of this Company,
holders of record

25*,

40*

.......

business

AMERICAN

common

VICE-PRES. &TREAS.

close of

Abilene, Kans.
May 19, 1958

will not be closed.

pany

quarterly dM>

30 cents
pet
the outstanding

capital stock at

stockholders of record'

of business June 6,

stock transfer books of the Com¬

MACHINE AND

ths doss

1958.
ALDEN L.

HART,

President

Hervey J. Osborn
Exec. Vice Pres. &

METALS, INC.

May 19, 1958

at the

oi
on.

the company, payable eta
or
before June 30„ 1958,

June 13, 1958. The

Board oi Director#

declared1
dend

payable July 1, 1958, to stock¬

25* i

Common

J. Ley,

IJXITKD YJTILITXMS,

business

share^

27*

|ll 1111 LLLULlLLLLLLLlL

International Salt

A dividend of ONE
DOLLAR

SCHNEIDER

Broadway, New York 4, N. Y.

...

DIVIDEND NOTICCS

Ni Y.

the

5.40% Convertible Preferred

Secretary? and Treasurer
25

per

5% Convertible Preferred

at.
on.

June 2, 1958.
R.

COMPANY

York 20,

Stock

Quarterly dividends payable June 16,
to shareholders of record Junie

'-Fifty Cents^ C$.50)

New

On May 28, 1958, a quarterly dividend of
433,i
cents per share on the Preferred Stock and a
dividend of 40 cents per share on the Common

June

COMPANY

ANACONDA

THE

WW HELME

^9 Rockefeller Plaza,

DIVIDEND NOTICES

Sec'y.

5Uth Dividend
1 4 5TH

DIVIDEND

of SEVENTY CENTS per share

•

per

second

quarterly dividend of $0.60

able

share in cash has been

declared

the

Stock of C. I. T. Financial

.
•
.

•

June

16,

June

COMPANY

quarter of 1958, pay¬
1958,

30,

record

shareholders

Common

the

for

declared

been

has

•

UNITED FRUIT

DIVIDEND

QUARTERLY

New England Gas

1958.

Robert G. Burns, Treasurer

at the close of business

COMMON

The

June

CORPORATION

;~>r mailed.

will not. close. Checks will be

•"

the

r" 'Treasurer

the

common shares

Association

Cor/>oratio/t

Both

1958.

COMPANY

A dividend of five
share

Preferred Dividend No. 78

The Beard. of Directorsof

$\.¥bYi

per

has^declared this day

of.business June 6, 1958.

stock

Corporation, payable

the close of business

1958.

The Board of Directors/has. declared-this day a

Boston, Mass., May 19, 1958

arc

15,

payable
the

June 24, 1958.

Moore, Jr., Treasurer

Alay 22,1958

UNITED CAS

SHIIllil!!!IIIUU!!!l

CORPORATION

June 6,

Dividend Notice

Company

The

COMMON STOCK

the

the Common
Corporation,
payable July T* 1958, to
stockholders of record at

of the year
share upon
the Company's common
capital stock.This dividend
will be paid by check on
July 15, 1958, to common

the

May 21,

COMPANY

Dividend

TREASURER

The Board of Directors has

26,1958

declared

quarterly dividend
thirty-five cents (35*) per
share on the Common Stock,
payable June 30,
1958,
to
a

shareholders
close

of record

of business

cash

1958,

dividend

orv

declared
for

second quarter
of 60 cents per

New York, N. Y.

Notice

per

The Board of Directors

BOND AND SHARE

WILLIAM FISHER

declared

share on
Stock of the

DIVIDEND NO. 170

ELECTRIC

be closed.

date

thirty-seven
and one-half cents (3

such

Jun> 6, 1958.

Directors

Board
this-

dividend

DIVIDEND NOTICE

•Tb(? stock transfer books will

LOU I B I- A N

IHREVIFDNT.

Pacific Gas and Electric
has

stock at the close of business

MOSSSfMay

EMERY N. LEONARD

Secretary and Treasurer

ol the

July

shareholders of record

Secrefa"-

regular quarterly
dividend, for the second ..quarter of/,the, year 1958, of 50?! per
share or* the outstanding (Common Stock, payable July 1, 1958, to

not

payable July 15, 1958, to- share¬
holders of record June 13„ 1958.

June

A. R. BERGEN

seventy-five cents

the capital stock of

Company has been, declared!

May 26, 1958.

record

this

common

Common Dividend No.. 53 \

holders,. of

per

30, 1958, to stockholders of record

the close"

(5c) per

been declared

outstanding

this

the outstanding $5.50 dividend Preferred

has today

dividends

H. C.

cents

the

quarterly dividend

Stock,, payable July 1, 1958, to stockholders of record

Quarterly Dividend
A dividend of

—

payable

close of business

DIVIDEND No. 94

;

Association

COMMERCIAL SOLVENTS

BAKING

payable July 1,
1958, and a regular quarterly divi¬
dend of twenty-five cents (25c)
per

May 22, 1958.

CONTINENTAL

NOS.

declared

have

convertible preferred shares

yC. John Kuiin,

•

DIVIDENDS

Trustees

quarterly dividend of $1.1214 per
share on the 4J4
cumulative

10,. J958. The transfer books

FINANCIAL

Consecutive

f'HEl'ChHkD AND

Corporation, payable July 1,

"1958, to stockholders of record
;

236th

and Electric Association

B. M. Byrd
3

stockholders of record at
the

business

Secretary

May 28,1958

UNITED CAS

June 17,1958.

the

business on

close of

June 10, 1958.

bervino

the

K. C. CHRISTENSEN,
Treasurer
San Francisco, Calif.

June 9,

1958.
B. M. Betsch,
Secretary and Treasurer

PGE

May 22, 1958.

SERVING

HOME AND

INDUSTRY

WITH ESSENTIAL BASIC PRODUCTS

Pullman

EASTERN
GAS
AND

FUEL

Incorporated

ASSOCIATES
—

387th Dividend

—

92ml Consecutive Year

DIVIDENDS
COMMON STOCK — A regular
quarterly dividend of 40 cents
a
share, payable June 28,
1958 to shareholders of record

June 6, 1958.
4'/a%

CUMULATIVE
PREFERRED
A regular quarterly
dividend of $1.12}^ a share,
payable July
1,
1958
to
shareholders of record June
6, 1958.

215th PREFERRED DIVIDEND
A

quarterly dividend of Wz%

declared upon the

Company,

($1.50

share)

STOCK

has been

Preferred Stock of The American Tobacco

payable

holders of record

in
at

cash

the

July

1958,

of business June

10,

stock¬

1958.

250 Stuart
Harry L. Hilyard

SUNDSTRAND
MACHINE TOOL CO.

regular quarterly dividend of

seventy-five cents (75*)
share will be

paid

per

DIVIDEND NOTICE

June 14,

1958, to stockholders of record

The Board of Directors de¬
clared

June 2,1958.

regular quarterly

dividend of
,

CHAMP CARRY
President

the

2 56 per

common

June

20,

holders

1958,
of

share on

stock, payable
to

record

share¬

June

10,1958.

E. H. BIRD, President

Checks will be mailed.

May 27,1958

—

Quarterly Cash Dividends

St., Boston 16, Mass.

May 22, 1958

G.J. LANDSTROM
Vice President-Secretary

Vice President and Treasurer
Our stock is listed on the
New York Stock Exchange.
'

•
.

.*»•

Symbol is EFU.

Rockford, Illinois
May 20.1938

The Commercial and Financial Chronicle

(2436)

Thursday, May 29, 1958

Junior

BUSINESS BUZZ

Boards

Brothers,

East 33rd Street,
16,- N. Y. (cloth)—

York

New

•

$3.50.

hm the Nation'!

Capital

■

Soviet Union

Management in the

A y* gJ
illI/IM/

Beliim)-the'Scene Interpretation!

m/M

Executives:

ure—John

Management Training ProcedR. Craf—Harper &

;

A. "1A/

—A bibliography—Selected Ref¬
erences

Industrial

—

Relations

Princeton University,
Princeton, N. J.—paper—30c.
Section,

with

WASHINGTON, D. C. — The
fact that Vice-President Richard
M. Nixon will officiate on June
10

national

dedication

the

A total of

blocks
House, is

the ..White

significant news

neither big nor
►

buildings

within itself,.7v:-';:v;
v

multi-million

among

monumental
fits into

buildings,
overall construction
Federal

concrete,

favorable.

and

called

financing
This

highest total in

Perhaps

had

the

been for

not

dividends

4.1%.
million

for

Retained profits of $696
were
16% greater than

the principal source of ad¬

Salaries and wages continued
to

ciation is strongly opposed to a

appli¬
severe

the

pick-up in work, President
Eisenhower asked Congress for
an additional
$4 billion for the
EHA

insurance

mortgage

to keep pace.

gram

John

American

the

Bookshelf

struction

that the proposed guaranty cor-

tion

rose

5%, primarily be¬

of the highway

construc¬
id u a 1,
housing
comparable with the same

cause

program.-

p o r a

t i

the

against

because

banks
that

commercial and private

maintained

was

would be available primarily to

month
The
says
a

last

savings

year.

of Public

Bureau

Roads

and

sponsoring the

corporation,,

guaranty

States:

loan

ernment

likely to
approve an Administration rec¬
ommendation (either a substanCongress

Such

York

penny.

Bank

Board.

would

Past

and

22. N. Y.

the

United

Future

—

(paper).

istration— Michael

The

$20,000,000
subcribed by
savings and loan associations.I
~

capital

of which

Its

Challenge to Personnel Admin¬
and

Wermel

Geraldine M. Beideman

—

Benefits and Insurance Research

of. the Federal Home Loan

arm

Growth

Gap Between Spendable Earnings
and
Labor Costs:
A Growing

corporation, under the
pending proposal, would be an

tial paid if not all) of $1.6 billion
in new military public works
some

but

J. .(cloth)

opment, 711 Fifth Avenue, New

would not cost the Federal Gov¬

appears

construction,

building,

Committee for Economic Devel¬

declares

grammed. but not finished.

home

started

Armed

the

before

Senate

Committee

Service

measure

the

called

Center,

which

would

in-

elude 58,600 new

military hous¬
ing units. Military construction
spending for the fiscal > year
starting July 1 will approach $2

Bureau

Jesse

—

Feeding the Growing
G. Murdough—

(Testimony
Airlines

Wolcott

other

Net
side

net

Education and

Hill,* the House
Labor Committee

few days ago

killed what chances there were
—if there

were

Industrial Relations

bill

50-50

matching basis

„

Water

Surface

Transportation of
on

Interstate and

Through

series

"How

College, St. Paul, Minn, (paper).
Property Insurance Fact Book 1958
—National Board of Fire Under¬

Better

»-

(paper).

Govern¬

of Economic Studies, Macalester

writers,
York

nomic

Italian Affairs—March-April

John

Street;

New

38, N. Y. (paper).

Bacon &

N. Y.

Own Economist"—Bureau

Davis,
Relationship
Inc., 39 Broadway, New York 6,
duction—Ford,

Productivity and Wages—Bulletin
No.

Evanston, Illinois.
Improving Profit

—

Printing Office, Washing¬
ton, D. C. (paper).

Your

Relations Depart¬

Senate

States

Prices

Stability

and

Eco¬

Growth:

Compendium
1958

mitted

of Papers Sub¬
Panelists Appearing

containing articles on First Re¬
sults of Parliamentary Enquiry
into Labor Conditions in Italy;

Before the Joint Economic Com¬

Italian Red Cross;

ing Office, Washington 25, D. C.
—paper—$2.

International
Center of Arts and Costume, etc.
—Italian Affairs, 56 Via Veneto,
Rome, Italy
(paper)—15c per
copy;

$1 per year.

mittee—Superintendent of Doc¬
uments, U.S. Government Print¬

TRADING MARKETS
American Cement

A. S.

off

were

Fashion Park

United States Envelope
-

Carl Marks
FOREIGN

fourth

permitting

profits after taxes to rise to

Co. Inc

slightly

smaller proportion than in 1950.

Morgan Engineering
National Co.

Flagg Utica
SECURITIES SPECIALISTS

20 BROAD STREET

TEL: HANOVER 2-0050

LERNER t CO.
Investment Securities

10 Post Office Square,

of net profits was distrib-

uted to stockholders,

Botany Mills
Campbell Co. Com.

Indian Head Mills

record of $1,374 billion. Almost

half

any—of a short

term Federal school construction

charge

smaller than in 1956,

Capitol

Motor Carriers,
Carriers)—

and

the Committee

the

tion's 13,165 insured commercial

the

Railroads, Part 2

Hearings before the Subcommit¬

execu¬

ment, American Hospital Supply
Corporation, 2020 Ridge Avenue,

banks advanced 6% during 1957.
On

Research,
Avenue, New York

t i o n reports net current
operating earnings of the na¬

No School Bill

National

16, N. Y.—paper—$1.50.

pora

billion.

—:

Economic

261 Madison

before

Federal Deposit Insurance. Cor¬
,

for

Committee

Economic Research

ment

country are
healthy condition. Chair¬

man

Universities-Na¬

the

Bureau

Foreign Commerce of the United

Mailing

The banks of the

Eco¬

International Economics

tional

Banks in Sound Condition

International

nomics—Papers and abstracts of
papers presented at a Confer¬

would be abroad. Hearings have
been

Problems

tee

Directories for

Coordination of Sales and Pro¬

Economic

that the corporation would stim¬
ulate

mews.

reprints of an address
meetings of investment

;', $io.

Loan

The bureau describes
the total figure as representing
the costs of all projects pro¬

progress.

Princeton,

Press,

associations.

Savings

League,

that by July 1 there will be

S9.8 billion roads program

loan

and

The

own

Giant—Thomas

Corporate Bond Quality and In¬
vestor Experience—W.Braddock
Hickman—Princeton University

lie

facilities

the

"Chronicle's"

tives—Public

Subcommittee

would discriminate

o n

inter¬
pretation from the nation's Capital
and may or may not coincide with

flect the "behind the scene"

the

Studies, Macalester College, St.
Paul, Minn, (paper).

ence on

[This column is intended to re¬

Hospitals

nancing Subcommittee, told the
Housing

for

Econ¬

Economic

Street, New York 10, N. Y.—$15.

tion's Housing and Mortgage Fi¬
Senate

pay

employees.

Bureau

—

Own

Lists — B.
Klein & Company, 23 East 22nd

Man's

New construction (all types)
in April involved an outlay of
some
$3.7 billion.
Public con¬
„

in bank em¬

higher

and

ployment

Compiling

Associa¬

Banker

The increase was

of 8%.

due to an increase

Guide to American

Chairman

Reilly,

crease

They

billion, an in

paper—30c.

Business

programs

backing the plan.

pro¬

ex¬

oi| the 13,165 banks.

totaled about $2.2

Section, California Institute of
Pasadena, Calif.—

supporting pri¬
vately financed residential
mortgages.
The United States
Savings and Loan League is

of the

major operating

pense

Technology,

duplication of existing govern¬
ment

Getting

Are

Your

Problems of the

proposal to create a new home
loan guaranty corporation on the
ground that it would result in
unnecessary
and
undesirable

resulting
curtailment of con¬
Because

the case
the profits

The American Bankers Asso¬

winter and late spring,
struction work.

ditions to bank capital.

Opposed by ABA

sharp

meant

invested capital, to

number of years

were
;

in 1956, and as has been

when they last put a

ton,

nevertheless

over,

moderate increase in the rate of

ton, rather than

earlier

filed

have

Applied to larger profits, liow-

omist"

price increase in effect.

re¬
second

;

than $3 a

(paper).

New York, N. Y.—$5.

Depressions

"How

prices

their

raised

have

not
more

1957—State

Smaller—Pamphlet in series on

believ¬
that the companies should

ing

were,

of the

many

would

cants

to be
explaining

going

Uncon¬
cropped up
that the steel companies might
raise
their
prices
again this
summer.
Sen. Kefauver said the

80,000

in history./

pany,

Our

firmed reports have

single month

mother-in-law

hearings resulted in him

the

was

economic trends, the
and the fact that his
is coming in for a visit!"
current

international monetary situation,

their

why they are doing it.

applicants for government home
mortgage

disturbed

"He's

the

raise

further
are

Year

Language for the World —
Mario Pei—Devin-Adair Com¬

Senator

that

to do some

to the 1958 Legislature for

Calendar

One

time

same

prices .they

spent in new

some

George C. S. Benson and

ment, Albany, N. Y.

them.

declared

companies

up.

ceived.

the

Kefauver

and billions of

said

(paper.).

Y.,

of New York Insurance Depart¬

reducing their prices rather

than raising

the

construction

officials

FHA

ago

Kefauver

the

taled about
the

days

few

Estes

ance

Starts in April to¬
95,000, slightly above
corresponding month of 1957.

picking

—Dr.

majority report, based on hear¬

Construction Up
home

17,

National Aid to Higher Education

used

ings conducted last autumn, said
the bid steel companies should

office buildings.

New

48th St.,

Ninety-Ninth Preliminary Report
of the Superintendent of Insur¬

Hill

Anti-Trust

public nonresidential building is
moving ahead almost as good as

York

New

Organiza¬

Association

2 East

Manufacturers,

into the news on

came

Senator

country. Factory construction is
down and probably will be about
a sixth down from last year, but

Home

Industrial

tions— National

by his
Subcommittee. < The

Steel

Capitol

buildings.
The big important construc¬
tion news as May drew toward
a close was the step up in build¬

last year. Billions
dollars are being

Ethical

the

M.
Payne — American
Enterprise Association, 1012
Fourteenth Street, N. W., Wash¬
ington 5, D. C. (paper), $1.00
(quantity prices on request).

Kefauver ancl Steel Prices

some

ing of various kinds across

and

with the issuance of a report by

headquarters

new

Association !

;

John

of the
AGC is part of a trend of the
major trade associations of the
United States to erect a building
in the Nation's Capital. Various
labor unions have spent millions
of dollars in Washington since
World War II constructing hand¬
The

of Ethics,
policies of

Practices Codes of the American
gress

amount of steel,
lumber and other

building materials will be
in the months ahead.

that is both significant

program

tremendous

Ab¬

L> Federation of Labor pnd Con¬

to the fact that

It all adds up

—

Code

official

Manufacturers
i

local economy.

able effect on the

situated
d o 11 a r

structure,

three-story

across

the

and

National

the

Standards

Management

from

Credo

construction will have a favour¬

'ceremonies of this $700,000

and

stract

49 East 33rd Street,
16, N. Y. (cloth)—$6.

Ethical

and

Labor

smaller com¬
the land. The

are

munities

dedication #

the

Nonetheless}

Moral

costing nearly $50,000,000, have either been started
or
will be under contract this
j fall. Obviously most of these
buildings,

General Con¬

tractors of America, four
west

New York

Uncle Sam.
918 new postoffice

Edited

—

by Alfred L. Seelye—Harper &

Brothers,

financially

shape

better

are

building

headquarters

of the Associated

to build schools than

new

in Transition

Marketing

states. As a
of the states

various

the

matter of fact most

Telephone
HUbbard 2-1990

Boston 9, Mass.
TeletyjH
B*

Full text of Commercial and Financial Chronicle : May 29, 1958, Vol. 187, No. 5746

FRASER