Full text of Commercial and Financial Chronicle : November 14, 1957, Vol. 186, No. 5690

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ESTABLISHED 1S39

OF

MiCHlGAr

-W07 I
«««

J;

MMDUtru

mm*

Bo*. V. a. Pat. Office

Volume

Number 5690

186

New York 7,:N. Y>,

Price 40

Thursday, November 14, 1957

EDITORIAL
VJ*

'J "•

See ft

As IEe

—Today and Tomorrow

John R.

Dunning, Dean of the Columbia School
of Engineering and one of the leading nuclear
physicists of the country, writing in the New
York "Times1* under the heading "If We Are to
Catch Up; in Science" has some important obser¬
vations upon our position vis-a-vis Russia in the
field of science and its application to defense as
well as other things. "At one "point 'he tells the
American people that "we have not merely fallen
behind in

of

sector

one

defense effort.

our

Harvard

"

We

of

revision

toward

a

recent headline in the business

"Times"

read

our

fessor

of

a

cross

the

to

a

30

Bad—Just

times it

At such

facts

of

to

'

"Capital gain" is still

Con¬

will

The

taxes.
go

to 91%.

reason

in

the light

of

where

on

of

money

nine

twelve

to

business

months.

prospects

at

a

television."

business

on

address

•An

Trainer,

by
Wortheim

Oct.

1957.

28,

Professor Lintner at
Company, Harvard

A

example

common

V

bonds.

described
/

in terms

securities, but

modities, foreign exchange, real es¬
tate, ietc.
Furthermore, in trying to
keep it brief and simple, the many
refinements and exceptions in the

Seidman

tax

rules

The
from

the

the

for

rules

will

law

be

omitted.

security "investor"

are

those who do enough

for

selling to be a "trader" or "dealer."

forum sponsored by
Club, New York City,

of

what is said will also apply to com¬

j. s.

32

placed his finger upon our

difficulty in keeping abreast—not to say
Continued on page 28

business.

Everything in this article will be

and

page

,

,

a

a

and

time when the overall

Continued

is

capital gain is the profit made
by an investor on the sale of stocks

market rates over the next
The present uncertainty over

comes

magic word in Federal income
Individual tax rates can

capital gains.

a

of

conditions

business

general

John Lintner

a

capital gain?
By and
large, it is the profit on the sale of
anything other than the merchandise

a

activity stands today and the major
changes which have occurred dur¬
ing the current period of recovery
and
prosperity.
I will then look
ahead and assess the prospects for

family and be a scientist, 25% thought scientists
are "odd," and 14% thought they are evil. "These
reflect parents' attitudes,"
Professor Dunning
adds, "and the anti-intellectual images conveyed
The Professor has

ex-

simple.

What

section of these remarks

be "focused

is

for

is usually

ti

crucial

foreign

Corporate rates can go to 52%. But with a
capital gain, Uncle Sam's maximum
take is 25%. Hence, the big push is

historical perspective.

The first

thought that their high school training was
poor to permit them to become scientists,
believed that one cannot raise a normal

by the press, comic books and

specified, points out that
commodities,

change, real estate, etc.

good hard look at
situation and try

a

the

interpret these

liHle

which found that

dents

xtoq

Aren't

helpful to take

recent study of Dr. H. H.
some 45%
section of American high school stu¬

Dunning cites

"Things

outlook.

support of his position in this matter, Pro¬

Remmers of Purdue,

are

cfiscussioiL*alsb Applies

section of the New

fusing." Whether things are really
all right or not, there is surely no
doubt about the general confusion
and
uncertainty over the business

training of scientists and our use of scientists."
In

different

buying and

Only the investor

a

&

Continued

on

page

30

f
SECURITIES NOW IN REGISTRATION

securities

DEALERS
*3.

are

afforded

a

Underwriters, dealers and investors in

—

comlete picture of issues now registered

tial undertakings in our "Securities in

corporate

with the SEC and poten¬

Registration" Section, starting on page

State, Municipal

38.

r

in

•

and

U. S. Government,

underwriters
•

Stale and

Municipal

(r.

e,

»

i

STATE

...

and

.

-.

and

*

MUNICIPAL

,

Public

;

Housing Agency

%

Securities

Bonds and Notes

COPIES OF OUR

distributors

-

..

»

telephone;

.

'

.

'•

:

•

•

% /.

HAnover 2-3700

.r .

'

-

'r

t

ENT

ARE NOW AVAILABLE

SECURITIES

ON

BOND DEPARTMENT

REQUEST
THE

THE FIRST NATIONAL CITY BANK

BANK
MCM0EBS NEW YORK ANO

ST., N.Y.

15 BROAD STREET,

Harris. Upham & C2
Members New York

OF NEW YORK

Burnham and Company

DEPARTMENT

30 BROAD

'

"market review"

CORN EXCHANGE

BOND

f

■

!

BONDS

Of

I NVESTM

CHEMICAL

120

AMERICAN STOCK EXCHAN6ES

NEW YORK 5, N.Y.

•

Bond Dept.

Dl 4-1400

Teletypes NY 1-708

34

offices

from

Chase Manhattan

Stock Exchange

BROADWAY, NEW YORK

TEUETVPE NY

CAM*. COIURNHAM

5

BANK

coast to coast

1
Net

To

State, Municipal,
•

.

-v

;

ATSON&CO.

J-

*+

-

Countv anil

.

.

Active

Dealers,

Members

Commission

New York Stock Exchange

American

Stock

/

4

14

'

*

<T

S

*

♦

*

.

+

STREET

/

CANADIAN
BONDS & STOCKS

v

DIRECT HIRES TO

*

v

:

*

MONTREAL AND TORONTO

com i 'a n y




BRIDGEPORT

•

PERTH AMBOY

115 BROADWAY * ;"
NEW YORK
:

1 NORTH LA SALLE ST.
CHICAGO
.

MUNICIPAL BOND

DoxnioM Securities
GrPORATIO?!

Goodbody & Co.
MEMBERS NEW YORK STOCK EXCHANGE

i rst

California

Municipals

DEPARTMENT

Teletype NY 1-2270

/

NEW YORK 4, N. Y.
i

For

Orders Executed On All

CANADIAN
-

'

25 BROAD

Maintained

Banks and Brokers

Canadian Exchanges

Exchange

District Bonds

Markets

CANADIAN
SECURITIES

1832

ESTABLISHED

f

..ve

A

York

fundamental

scientists,

*«Jes. Though securities

half of 1958.

if

immediately is

attitude

our

.

Nationally known accountant briefs individual and cor-|
porate investors on income tax pointers they should be:
aware of for the present security market. After explaining,
tax-application to capital gains profits and losses, MrJ
Seidman stresses tax advantage in watching six months
line, spacing between years, short sales, and converting
dividends and interest into security profits. Outlines
specifics corporate investors should consider, and pro¬
vides crucial dates for and explains timing year-end

'

graduate some 55,000! engineers in 1965—
roughly as many as the Russians graduated in
if

'

.

confidence, and
for the next several months anticipates the economy will
remain on an even keel, with some downturn probable in
the first half of 1958.in evaluating the economy's favor¬
able and debit sides, Professor Lintner foresees in the
immediate period ahead, assuming unchanged Federal
spending and tax rates, such specifics as: (1) $2 billion
capital spending downturn offset by state and local out¬
lays; (2) moderate improvement in housing, and decline
in inventory purchases, and (3) maintenance of curiWnL"
consumer
spending rates with somev increase in first 4

may

if

Seidman & Scidman, New York City

University

Harvard economist views the future with

producing more scientists and engineers than we,
training them at least as well as we, and chan¬
neling them into crucial areas more realistically
than we. If we maintain our present growth we

"What is needed

By J. S. SEIDMAN, C.P. A.

Graduate School of Business Administration

make

1955.

Present

By DR. JOHN V. LINTNER*

,

becoming enfeebled in our basic ability to
a
defense effort; the Soviets have been

are

Copy

a

Income Tax Pointers for

'V

'

Cents

40

Exchange Place, New York 5, N. Y.

Teletype NV 1-702-3

WHitehal! 4-8181

DEPARTMENT

.

'

lattlt of America
NATIONAL

300

IKft/cS ASSOCIATION

Monteomery St., San Francisco, Calif.;

Chronicle

The Commercial and Financial

2

(2102)

"

For Banks,

The Security

Brokers, Dealers only

be

Because you can
1.

Speed

2.

Experience

they to be regarded,

ce

as an

Vice-President

Bank

basls^than"

a. A.

4. Reliable Executions

Markets in

more

fho

Tn

''Chronfde^Tmay
usual

than

to

suggest

like

to

con-

other

•

CHICAGO

PHILADELPHIA

•

BAN

invest-

which

Teletype NY 1-40

BOSTON

FRANCISCO

might

appeal

How-

ing

a

larly

mm

There

particu-

are

can

in de

"ing xrst;
To begin with, general

not

K. Browne

an

A

ip

PP

a

are

SCRIP

&

Vnn^dir
consider ^pfhpr
whether

fn
to

nfcipal bonds

Since 1917

security

or

sufficient to
suiiicieni
10

vestor

"McDonnell&fo.

to

have been approved by the Leg-

mu-

jsja^ure

*

his

in-

fixed
nxed

inin

of

some

in
in

funds
lunds

this
tnis

municipal

York Stock Exchange

Exchange

Stock

American

as

BROADWAY, NEW YORK 5

evidence

as

of

cTnsidered
interest^ to those

r6C6ivins

Trading Interest In

American Furniture

Industries

Life Insurance Co. of Va.

point

fnrther
further

in

over

Municipal

in

whole.

,

%

Assessed Value...:.
Full value

%

Personal Income....

Per

Total

2,263

452,350,000

712,684,795

647,187,769

306,720,000

231,107,000

2.07%

2.23%

4.23%

1.41%

0.60%

i.45%

1.34%

1.54%

1.97%

3.12%

1.66%

1.71%
1.32%
1.48%

$33.26

$44.01

$58.00

$33.72

$30.75

.......

1,577,917,406

1,308,864J94

861,234,279

1,163,757,515

787,522,861

Personal Income....

Telephone: BOwling Green 9-0187
This

is not

orders

for

offer

an

solicitation

or

for

particular securities

any

Per

40

years

the

clearing of securities

experience

in

transactions for dealers
in

listed

unlisted

and

securities.

Members
New York Stock
American

150

Stock

Broadway

Exchange
Exchange

N. Y. 38, N. Y.




5.04%

$104.78

2,644,620,000

804,486,000

738,196,000

991,358,000

194.46

49.67

66.19

108.99

85.91
^

8,670,358,000

14,149,442,000

9,939,939,000

637.53

873.69

890.76

i

tMnrc

-£

f

10,153,718,000
1,116.28

8,733,649,000
1 162.0i

/in

eronnmv

.

(2) Per

wealth

capita

/ov

Natural

rpsnnrrps

6)

; (g)
tions

onLial

They

are

well

is

.V

EMpire 3-8204

Burns Bros. & Denton
INC.

tain other states, and for savings

8.9%

$9,897,990,815

$8,589,571,775

$7,349,220,000

$5,943,199,000

1,109

1,785

1,360

1,344

14,116,000,000
1,614

10,010,000,000
2,097

12,304,000,000

5,371,000,000

2^11

1,266

111,155'000

MASS.

«

•

T\Tew

banks

York

California and

New York 5, N. Y.

cf'fr_

Bonds are in coupon form,
reSisterable only as to principal

1.51%

0.51%

2.90%

.

1.14%

0.70%

5.94%

0.90%

4 28%

interest is payable

$25.54

$11.03

$123.52

$20.57

$52.00

of

3.87%

(11)

Prinrlnal

301,634,801

443,720,305

363,992,506

6.47%

3.01%

3.61%

6.78%

Per Capita

$74.84

$102.34

$62.68

$82.12

$82.30

1,710,539,000
182.73

1,916,132,000
214.69

171,887,000
35.72

309,646,000
57.31

1955 income-Agriculture

Treasurer of

the

1,15^.85

or

at

thp

the

State

~

Sacramento,

"

,

at

National Quotation Bursa
Established 1913

traded nationalv

for 43 Years

Calif.,

of fhP holder

are

Quotation Services

of

New^York^ity^
YOrK UUy*

(12) Bonds

<r

2,197,461,000
496.83

in

nnfjon

Over-the-Counter

spmi-anmial

pi, at tne option oi tne noiaer, ai
the office of any duly authorized
agent of the State Treasurer, in-

942,757,000
^rerTn
213.15 urer ln
■

6,266,655,000

anH

U1) principal ana semi-annuai
at the office

California
913,422,792

3.34%

'having**

necticut.

Personal

700,554,504

Canadian and Domestic

Qavin«c

w

%

(Latest

Dealers

cer-

and interest in denominations of
229,99o'()00 $1,000.

% Personal income....

Underwriters—Distributors

in Massachusetts and Con-

4.84%

4,334,673,000
900.80

37 Wall Street,

ex-

are

4,061,929
4,423,000

3,508,133,000
393.07

y

Toronto, Canada

St West

revPnue

>6.92%

9,461,592,000
1,029.97

J

-f/'/f.

COMPANY

LIMITED

legal investments

594,367^897

Per Capita

and

•

ported by special revenue.

0.99%

Per Capita

Limited

anv

hv

0.49%

cu,'t|e)D!Ph.0!.A.9r!:

PIPE LINES

are general obligaadditionallv
suo—

Bonds
—m

nnrtpf1

98,410,400

Value Added by Manufacture (1954 Census)..

||

excellent.

0.87%

Year)

■

burden' is modest.

Debt

0.87%

Revenue

.,!

—

(7) Financial record has been

Full Value

Per Capita

of

(5) Tax base is broad.

Assessed Value
income

Securities

the

'v natural resources are ex
tensive and locations strategic.
(4) Growth has been dynamic.

%

239,126,619

AH

TRANS-CANADA

,

%

Net Bonded Debt

Trading Markets Maintained

in

above national average.

11.7%

(U.S.Dept.of Commerce) 20,988,000,000
Per Capita
2,257

Firm

is

4,830,329
5,403,000

2/949

Bankers

Investment Securities

fVIifnrnifl'q

^aillQITUa * economy 15
nlgniy diversified.

2.6%

$2/,601,900,590

Investment

V;

4,690,514
4,812,000

15.7%

,

TEXAS

&

111 Broadway, N. Y. 6 CO rtiandt 7-5680

«

for savings banks and trust funds

7,711,194
8,925,000

m

C? 4-

N. C.

7.4%

...

io«rp

i

NEW JERSEY

8,712,176
9,361,000

increase

Fiscal

LOBER BROTHERS & CO.

6.32%

$127.94

tcvac

Total

Inquiries Invited

4.16%

'$77.18

ILLINOIS

-

Tokyo, Japan
Brokers

J"eaSOns wny ^jate Ot Gailiorma
bonds represent the "Security I

(9)

Assessed Value

than

3.61%

580.82

Per Capita

1956

more

5.36%

S116.02

Capita

Value Added by Manufacture (1954 Census)..

Population 1950

We have had

0.84%

•
645,677,000

ti

CLEARANCEFACILITlES

,

Tu s^TZ?.
culture)

-

Y

Yamaichi Securities Co., Ltd.

of the compelling
1*4-

some

/©

15,632,000,000
2,134

Per Capita

61 Broadway, New York 6, N. Y.

7'5!r'!!o0
sketch of
lo.U

:0

Revenue (Latest
Year)

July 2, 1989,

9'W6,ooo
14,J

v»0 7©

18,442,000,000
2,062

1

Inc.

of

Mich,

20,724,000,000
1,902

Capita

Fiscal
%

Nomura Securities Co., Ltd.

0f Harbor Bonds due

7,946,627

36,255,000,000

York,

Affiliate

turities running two to 21 years;
School Aid Bonds from three to

10,498,012

2,271

New

Trading Dept.

H/159,00°

29,438,000,000

of

In recent years, Veterans' Aid
Bonds have been issued with ma-

Like Best":

(U.S. Dept. of Commerce)
Per Capita

write

-

1955 Personal Income

%

additional material of interest,

16,1?q'^°
IV,/ /o

,

Securities Company

73 Kin^

are

$21,818,921,643 $31,930,588,437 $15,296,471,000 $21,804,609,056 $13,481,718,116
i>4
i>72
1,371
2,191
i>94

Capita

Net Bonded Debt

Digest, and our other reports
that give you a pretty clear
picture of th, Japanese
economy at. a

Zo.D /o

or

[

information

Yamaichi

WISENER

14,830,192

10,586,223

13'622'e2?

Call

accompanying tabulation, cornpiled as of April 1, 1957, presents

subject to sinking fund retirement.
6,371,766
The following is a thumbnail

195°

current

476,000 and net debt was 485,555,000. The comparative data in the

ohio

Population 1950
•*••••«••»«•*

fo.r

York $58 for Pennsylvania and
$123 for Massachusetts. Total debt
as of Oct. 23, 1957, was $1,162,-

Pennsylvania

new york

Per

Stock

typical

Xhi^c^J?aies pith

supported by the tax- 27 years; and Harbor Bonds from
jng power 0f the State, though in six to 30 years. The longest maactual practice the State has not turity of State of California general obligation bonds is an issue

California

Assessed Value

Monthly

be

State of California general ob-

Comparison of California With the Ten Largest States

increase

our

to

back tbrou£h taxation.
ugations

•

llltrcdj"

IN JAPAN

—'

buying

municipal bonds.

bonds

Lynchburg, Ya.

Opportunities Unlimited^

years

th«.
the

'

STRADER and COMPANY, Inc.
TWX LY 77

20

emphasizes

opportunities

for

authorized any Veterans' Bonus

Bonds, preferring to offer eligible
veterans the opportunity of buycome
taxes and larger incomes,
homes and farms through
the base has broadened
so
that loans, at relatively low rates of
today most investors can seriously interest. The School Aid Program
consider municipal bonds in the permits
school districts which
development of their investment have reached their bonded; debt
program. The "tight" money fiiar— limit to authorize a State loan, in
ket having created higher yields the same manner as a district bond
on
municipal bonds—almost the issue. Such loans are being paid
high

Commonwealth Natural Gas

LD 39

substantial

For

aie

.

institutional
investors subject to Federal income
taxation.
With higher in-

STOCKS

purposes.

have been sold and some institu- debt service in the ensuinS yearstional building bonds have been
California's per capita debt is
uuthorized.
California has. not ifi lino, boing * a little ovci $33.

income and, of course,

•

good

lssued lor various . ...
.
,
indebtedness was
In recent years Ja J' ,au sacTu inaeDt;eoness was
/ ,
h
.
J, f
funded and the record cleared.
most Ponds nave been issued ior Th
*
record of anv default
Veterans
Aid and School Aid. ine*e ls no record ot any deiauit
harbor imnrnvpmpnt bonds
or temporary, delay-in payment

wme

onlybeingof

individuals

TEL. REctor 2-7815

Bassett Furniture

bonds

offices

certain of its obligations in 1854,

Members

New

branch

presumably unlawfully incurred.
However,

H°nds

State

the
average ininine aveiage

causp
cause

place

vestment
vesimtni

in

Dnt
not

cr
01

provide income,
market appreciation
can

it was in default on interest on

our

JAPANESE

is-

stitutionalAmendment which must

RIGHTS

Mobile, Ala.
Direct wire* to

while: various building bonds and
10th Olympiad Bonds are secured
' The lncome from state of Cal~
ifornia municipal bonds is exempt

NY 1-1557

New Orleans, La. - Birmingham, Ala.

considered fully self-supporting,

,elsIonssued
by the gtate and gold-at
- The
State of California has
pu51ic sale< Bonds must be auth- weathered its share of financial
orized by a majority vote of the storms. Its debt payment record
electorate, approving a State Con- is good. History indicates that

Municipal

51

18 Rector St., New York 6, N. Y.
HAnover 2-0700

rome^xes' rr
obligations^5s''"g statutes, and court de-

State of California

the

of

are

Members New York Stock Exchange
Members American Stock Exchange

=

char-silll?:ing funds*

be generally

to rrmnirinal bonds

annlird

-l

Steiner, Rouse & Col

for over 40 years. Debt service

t

simnle

several

acteristics which

ATfi™
tnis; time

Specialists in

—Alfred R. Hill, partner, Hill
& Co., Cincinnati, Ohio, (page 2)

will levied an ad valorem property tax

plied to State of
As all have the same credit base,
they can be lumped together and
considered as one credit.
"w

attrac-

bonds

:
-

...State s generals obligations
^^ansfer to the General Fund,
The ...Veterans Aid Bonds and
California bonds. •; Harbor Improvement Bonds are

Wires to Principal Cities

Private

Bought—Sold—Quoted

-ranC1SCO' Cal*

The "security I like best".is a .?" the State s general obligations
general obligation bond of-the ^ paid from the General Fund,
State of California. Readers must However, certain funds provide a
understand that the use of "gen- ™ea?ure of ?elf support for some

be-

as

National Trust & Savings

diversified "The Proctor & Gamble Company

speak for themselves.

ment medium

York 5

120 Broadway, New
WOrth 4-2300

un-

flf
lfcr|JilBiM

sidersome
Member

Stock Exchange

ica

eral
obligation"
encompasses
'mmbonds of varying maturities,; interest rates and purposes, as ap-

in-

would

vestor

Established 1920
Associate

appear

stock.

usual

the

Louisiana Securities

gation Bonds—Alan K. Browne,
Vice-President, Bank of Amer¬

best" must be

tion, but I believe the facts

think that the
average

Corporation
American

the

would

I

State, of California General Obli-

bonds, I have * been.—
somewhat prejudiced in my selec-

security other

a

common

some

ever

of

render*

manv

^
,

^

municipal

Bonds

than 400 OTC Issues

New York Hanseatic

Obligation

General

California

of

nor

portfolio of stocks. In discussing
the «security j like best" among

San Francisco, California
State

intended to be,

of a "security I like

America

of

are not

Alabama &

v Their Selections

offer to sell the securities discussed.)

ALAN K. BROWNE

3. Nationwide Coverage

5. Primary

This Week's

.

,

(The articles contained in this forum

Write

.Thursday, November 14, 1957

Forum Participants' and

.

week, a different group of experts
In the investment and advisory field from all sections of the country
participate and give their reasons for favoring a particular security.

of

sure

I Like Best

#

A continuous forum in which, each

Try "HANSEATIC"

120

,

4

r

.

.

'

ot?

LOUtlUUea 071 page JD

46 Front Street
CHICAGO

New York 4, ft V.
BAN FRANCHBOO

■

Mr

•

Volume 136

Number 5690

The Commercial and Financial Chronicle

...

(2103)

Achieving Greater Efficiency
From Our Untapped Oil Reserve
t

INDEX

—J. S. Seidman.....

i

.

(New Jersey)

necessity, not just social responsibility,

re¬

and keep costs at lowest possible level which, Mr.
Rathbone insists, involves raising present research expendi¬

J Dining

and in

The oil head decries small land divisions

;

:

try has an
ity to our

nation.

A

large part
responsibility lies in main-

of this

efficiency.

As oilmen, we must also recog¬
nize the fact that we face constant

ents

m

oil

and

indicate
t

will

cans

these
fuels

greatest

be

calling

of

for all of

Ameri¬

for

the

70%
much
M.

larger volume
of energy they
will
need
20

t These
will

facts

Rathbone

from

years

to

now.

required

and

require tremen-

j dous efforts on the part of the
U. S.

producing industry.

But

I

think

it

that

the

apparent

is

ing

portant

increasingly
pro-

responsibility to
the
goes
beyond the
hard, constant work needed to
find
and
develop
the supplies
States

which
tion to

i

people need.

our

demand, it

i
"

In, addi-

making sure that there is
of our products to meet

-enough

to

seems

that

me

pro-

ducers also have the growing ob-

ligation to hold costs down so that
the prices to consumers can be
kept at the lowest practical level,

'Holding
even

costs

down

assumes

importance

greater

during

^periods of oversupply, such
have

been experiencing.

as we

I might

add, here, that I will have
to say

later

about

on

more

supply situation
in this talk. Before doing
our

that, however, I would like to get
into

this

important

question

of

efficiency.
As

businessmen,

of
a
system dedicated
to
seeking
ways to greater efficiency. Indeed,
this is the whole justification of
competitive capitalism. Today, as
members

of

the

we are part

American

busi-

system, we have the very
obligation to demonstrate our
ability to give customers what
they need at prices they can af-

*

of,

so

because

every-

where, including the United
States, there is growing concern
about the dangers of
inflation,
which

is

cutting

is

—7-—

j»

driving
"

,

prices

into
__

higher
the value of

t»

.i

t-

y

that

<^u£mmLX 5 fhe'^Tpent^
Producers Association of America,

A.

14

GENERAL MINERALS

development

Warner

15

RIDDLE AIRLINES

The Importance of Allies to U. S. Strategy and Policy
—Brig. Gen. David Sarnoff

16

Steel Industry's Greatest

17

—William
..

* *

V

.

v

P

TV

Challenge—Joseph L. Block

1

Faricy

"

|

Consumer

'

,

_

Finance

J.F.Reilly&Co., Inc.

18
'

•

Capital

Company.

and

Term

Members Salt Lake City Stock Exctu

Financing

Spokane Stock Exchange

—Wallace M. Davis

.

20

1
Finding Your Diamond in the Back Yard—Roger W. Babson— 23

Exchange PL, Jersey City

DIgby 4-4970

—E.

Sherman

HEnderson 4-8504

Teletype:

Monetary Management's Impact Upon Commercial Banks
Adams___

JCY 1160

24

39
*

*

*

Exchange PL, Salt Lake City

DAvis 8-8786

Must They Contribute?

make it clear that

(Boxed)

21

On

27

the

Right Track

(Boxed)

•

Teletype: SU 155

12

...

II. Eugene Dickhuth Cites Economic Impact of "Mega-Opolis"

■

Riddle Airlines

i
„

higher levels of efficiency in the
domestic

producing industry

McGraw-Hill/Survey Projects Small Decrease in Capital

are

Expenditures for 1958______

essential both to the producer and

to

the

consumer.

it

And

equally clear that one of the main
leading
to
these
higher
levels
of
efficiency is that of
technical progress—and by this I
do
not
mean
the
day - to - day,
routine engineering and research
with which

As We
Bank

ward

we

and

..Cover

Stocks.

Insurance

Coming Events in the Investment Field

of

for

considered

the

news

that for the past several years costs of finding, developing, and producing crude oil
have been rapidly mounting. Cash

Our Reporter

Governments.

Report

Public

Securities.

it

Utility

—

I

Washington

Continued

Texas, Oct. 29, 1957.

on

page

^'Column

Like

Lithium Corp.

42

Offerings

Radorock Resources

29

Corner

16

.-

United Western Minerals

2

Best.

You...—

and

28

Dallas

*

Universal Transistor*

4

—

*8

—

S,an Juan Racing

than probable that costs will

Dallas,

Los Angeles

Chicago

33

38

and You—By Wallace Streete

...

Philadelphia

34

of Trade and Industry.

State

The

seems

5

31

Security

Security

■

to

22

May.i

...

Salesman's

The Market
The

inc.

Exchange PI., N.Y.

Direct Wires

in Registration

Now

Securities
-•

•

Securities

Prospective

Increases in income

on the producers'
investment have been progressively reduced. Looking into the
future, and assuming only normal

on

Our Reporter's

Securities

suit that returns

more

Wilfred

40

Teletype NY 1-1825 & 1-4844

44

Observations—A

Mackie,

HA 2-0270

46

:

—

*

Railroad

-

have not kept pace with these increases in expense, with the re-

efficiency,

Funds

t

sure,

in

&

*

of Current Business Activity.—

Indications

technical

era

Singer# Bean

8

From Washington Ahead of the News—Carlisle Bargeron

(

News About Banks and Bankers

profitable

14

r.

Einzig: "Will the British Government Really Resist Inflation? 13

and

lion in 1956.

Sulphur

48

Recommendations.

Investment

Dealer-Broker

American oil business.
am

Pan American

30
—

Mutual

I

Ray McDermott

are

frontiers

It will not be

J.

Advance Industries

(Editorial)

knowledge, the domestic producer
can help
open up a whole new
more

.

47

Business Man's Bookshelf

bold,

new

See It

^

.

Pacific Uranium

43

>

y

(Boxed).

Regular Features

,

familiar, but,
imaginative and
freshly creative research methods,
Indeed, I believe that by taking
full advantage of the technical
progress .we^ have made
so
far,
and by vigorously pressing forrather,

L
'

■

Calm Appraisal, Anyhow

A

seems V

roads

progress

*

GULF COAST

LEASEHOLDS

What About the Railroads in the Next Ten Years?

'■'i

imthe oil

expenditures of the United States

and

—Bradford

r

very

producing
industry
have
risen
from $2 billion in 1946 to $7.5 bil-

is

14

Customer Relations and Business

capital needed to find and produce
future supplies,
reasons

MINERALS

LaBorde

Hold-

real

This

H.

/'V —Melvin O. Hall..;

will be sufficient to
the
incentive
and... the

These

'

-

UNITED WESTERN

States' Securities Administrators Look at New Developments

effi¬

ness

ford.

-—Edward

generation
provide

domestic

also

assuring

in

^

DOMAN HELICOPTER

own

our

levels

down js

10

12

industry's profit margin and cash

ducer s'

United

costs

1

I

Canadian Oil and G&s Investment Opportunities
;

suppliers

would like them to be.

we

have

continue

J.

Curtiss________

*

ciency. Unless we do, we cannot
realistically expect other segments
of
the
industry, "the American
public, or the government to be
as sympathetic to the problems we
face in the producing business, as

on

same

D.

—Joseph H. Taggart

to strive to reach thb

us

possible

8

.Forecasting Interest Rates and Business Conditions

of other fuels.
This competition
would, by itself, be reason enough

and fore¬
a

the

from

and

Langum

^ •

business

t h

;

his

competition both within

gas

»

im¬

quire

casts

»

this

-'

y

r.

to

increasing

its energy re¬
from

1

end"- by"

STREET, NEW YORK

Telephone: WHitehall 4-6551

•

—C;

country now
gets
68%
of

contribution

WALL

99

6

*

Federal-Aid Highway Progress for the Nation and Southeast

■;

taining ade¬
quate sources
of, supply; our

portant

4

The Current Economic Outlook—John K.

peoples' income and savings., Although it is not the responsibility
of the businessman alone to coritrol inflation, he can make a significant

at 99 Wall!

3

■

Time—Ira U. Cobleigh____

on

mad compulsion is cash,

satisfying it

*

.

producing indusimportant responsibil-

....

—Sylvester Petro

.

overcoming current over-supply condition.

domestic

try

Compulsory Unionism and Respohsible Unionism

competitively dictated excessive oil drilling practices in.'
urging unitization of oil field drilling and further secondary
recovery efforts. Calls on producers to share in research costs

The

If your

"

and

***'"••

Cover

,

less than one-half of 1% of all the money the producing industry spends to 2% to 5% commonly spent in other

'-

Lintner

—M. J. Rathbone

_

tures of

technical industries.

V.

Achieving Greater Efficiency From Our Untapped Oil Reserve

recovery

-

Economy's Performance: Today and Tomorrow

—John

quires increased research efforts in order to augment crude oil

•

___Cover

______

COMPULSION

Our

Sheer economic

:

Security Market

1

:

Page

,

ASP COMPANY

Income Tax Pointers for the Present

By M. J. RATHBONE*

President, Standard Oil Company

llCHTflWEM

-

Articles and News

3

week.

not available this

Common & V. T. C.

"

V

'

-

Published Twice

Weekly

1

-

For many years we
have

c/o

Reg. U. S. Patent Office
WILLIAM
25

,

;

Publisher

WILLIAM DANA SEIBERT, President

Members New York Stock Exchange

25

BROAD

TELEPHONE HAnover 24300

Every Thursday (general news and advertislng issue) and every Monday (com-

issue —market quotation
records, corporation news, bank clearings
state and city news, etc.)
plete

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on

Request

ITO

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n
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in
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and Members
^

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8.

of

W» V. FRANKEL & GO
INCORPORATED

in

year

39 BROADWAY, NEW

YORK 6

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TELETYPE N. Y. 14 '

•

E. C. Eng¬

Other Countries. $67.00 per year.

Thursday, November 14, 1957

ST., NEW YORK 4, N. Y.

t

.

'•

REctor 2-9570 to 9576

London.
Smith

""id" thVct" Of Stcb "

York 7, N. Y.

HERBERT D. SEIBERT, Editor &

&

Reentered as second-class matter Febru-

DANA COMPANY, Flblfeh.r.

Park Place, New

"

r

Spencer Trask & Co.

B.

Edwards

Copyright 1957 by William B. Dana
Company

FINANCIAL CHRONICLE

PREFERRED STOCKS

specialized in

Gardens,

Diapers'

land

The COMMERCIAL and

'

*

statistical

Other

Offices:

Chicago 3.

111.

135

South

La

8aile

St.

(Telephone STate 2-0613);

f)t^erwiUbli^tl°nI

„

n,Wl

Bank and Quotation Record — Monthly
$40.00 per year
(Foreign postage extra.)
Note—On
the

eign

rate

fluctuations In
remittances for for

account of the

of exchange,

subscriptions and advertisements must

be made in New York funds.

Teletype NY 1-4040 & 4041
Direct

PHILADELPHIA

Wires to

SALT LAKE CITY

The Commercial and Financial

Chronicle .Thursday, November 14, 1957

(2104)

4

tally, pare the padding of sales¬
men's expense accounts, which
have been a little too imagina¬

Dining On Time

The

tive); and to individuals beginning
at around
the $9,000-a-year in¬
come
bracket.
Diners' Club has

COBLEIGH

By Dr. IRA U.

tr

Enterprise Economist

most

It's

food for thought about one of the unique and
rapidly growing corporate enterprises of our time,
Diners'Club, Inc.

or

in

perhaps an unrelated doll-girl,
a
posh restaurant, order the
from

works

antipasto to
anisette, reach
for your wal¬
let and—pow

'^-you're $30
shy!
What to
Offer

do?

check?
They don't
your

know

you!

;

ally laggard in paying their bills
(regularly taking more than 30
days to get the dough up) are
dropped.
Thus the membership
list is not only kept current, but
highly creditable.
the

At

this enterprise

of

start

it wasn't too easy
to get people to pay $5 for a credit
card they might
not use fre¬
quently,
particularly when (at
(back in 1950)

that

there were relatively
honoring them.

time)

few establishments

Volunteer in

*

current basis;

a

the dish wash-

restaurants, the re¬
quirement to give up 7% of gross

ing depart¬
ment, tender
your
wrist

siderable

And

among

member billings, created con¬

on

amazing

organization
Club,. Inc. Here's
how it works. You pay them $5 a
an

called

pected, however, that the rate of
growth will continue on the same
upward slope established in the

past five years. Also, in consider¬
ation of this enterprise, it must be
noted that it is as yet untested by

depression. People are highly
their
bills in full and promptly.
And
Diners' Club membership is culled
from the more opulent. But there
is a possibility of some payment
slippages if we move into an eco¬
nomic
backepin. •»■( Average card
holder billings are now running at
any

solvent these days, and pay

about $165
The

year.)

per

is listed on

stock

common

year.

That makes

and causes

sued

a

in your

ored all

you

a

member,

credit card to be is¬

About 65% of the income comes

may

memberships (which
include more than one card,

as

man

from the $5

a

of

and wife; or the mem¬

firm). The rest comes
from the discounts—7% on most
bers

card hon¬

name—a

thing has

has been 6%

young

Diners'

the

a

the United

States, in
Europe, Japan, Australia, and in
over

of the business, but as high as 10%
on
certain services, and 15%
in
South American countries. foreign countries. $5 memberships
Now this card is not, however,
are growing at the
rate of about
honored everywhere as, for exam¬
15,000 a month with cancellations
ple, a traveler's check would be,
and lapses of between 1,500 and
but it is and will be, honored, not
2,000 a month. The Diners' Club,
only in thousands of restaurants, Inc. fiscal
year ends March 31. At
cafes, night clubs and hotels which the 1953 fiscal
year-end
there
subscribe to the plan, but at Hertz
were 60,000 members; 1954, 90,000;
car
rental
agencies, < gift shops,
1955, 160,000; 1956, 250,000; and
flower and liquor stores, and at
1957, 410,000.
This velocity of
certain employment and service
membership growth is little short
organizations.
You join so that of fantastic.
your tabs can be
billed to you
It has also resulted in remark¬
(and peruana to document an ex¬
able forward motion in gross and
pense account).
They (the res¬
net earnings.
Again using fiscal
taurants) join because they be¬
lieve it will bring them more cus¬ years, total volume of charges has
advanced from $10.7 million in
tomers—that people will get in
the habit of patronizing the places 1953, to $64 million in 1957; and
net after taxes has, in the same
listed in the Diners' Club mem¬
oeriod, moved ahead from $82,000
bership roster, in 77 nations. For
in 1953 to $782,000 in 1957.
The
the privilege of displaying a Din¬
ers' Club membership sign, and gross for the 1958 year is being
estimated
in the order of $110
thus attracting card holders, the
million
a
net
with
of
around
subscribing restaurant agrees to
U,500,000.
pay, or rebate, 7% of each gross
Rate of profitability has become
check, to Diners' Club.
As a matter of operation and quite predictable—slightly above
bookkeeping practice, Diners' 1% of gross, and this after allow¬
Club bills out charges incurred by ance of about 7% of billings for

many

all

members,
expects each

promptly

each

member

(within

30

and

month,
to

pay

days).

The

accounts and bad debts.

soggy

Here, then, is

interesting
practical application of con¬

and

a very

Club, in turn, pays all restaurants,

sumer

etc., within 30 days. So everyone
is hapov and nobody gets hung
up.
Ttmre are, of course, a few

appeal is primarily to corporations
which can, through Diners' Club

backsliders.

audit and check travel and enter¬

Credit cards

are

re¬

issued every 4 months just to keep

charge

credit

to

a

accounts,

tainment expenses

new

field.

better

Its

in stock.

There was,

shares

have

advanced more

dramatically, that fact might well

mutual

There

is

the

the

be

can

new

idea, the

*

DEALERS

*

■

,

,

The

United
claims

in gross

sion

Total insured unemployed was listed at

primarily

2,500,000 at mid-October, a time it normally declines.
The total was about the same as last month but up 400,000
from

these fac¬

These Diners'

tired market.

a

con¬

may

animate performer

buying
the

a

Diners'

little

Club
for

woman

Christmas. She likes to eat,

doesn't

she?

•\

CHICAGO, 111.—Jack H. Miller
has

associated

become

with Rey¬

nolds & Co., 39 South La Salle St.
Mr.
Miller
was
formerly with

Goldman, Sachs & Co. in Cleve¬
land

and

thereto was Co¬
lumbus manager for Baxter, Wil¬
prior

liams & Co.

38 Offices




•

NEW

YORK

Union

been

trade inventories was

seasonally adjusted

but this increase was only half the $200,000,000 average
gain of earlier months this year, reports the United States De¬
partment of Commerce.
•
•»
—
At the end of September, the total book value of all manu¬
basis,

.

facturing, wholesale and retail stocks was $91,400,000,009, on a
seasonally-adjusted basis. An increase of $200,000,0°0 in retailers'
stocks was partly offset by a drop in manufacturers' inventories.
Wholesalers' stocks were unchanged.
and trade sales from the end of August
seasonally-adjusted basis were off $700,000,000,
the Commerce Department said. The bulk of the decline came in
manufacturing sales which, at $28,200,000,000, were off $400,000,000 in September from August.
However, manufacturing sales

Security Adds

added

to

staff

the

of

South

is

Mich.

now

—

were

F.

Ray

affiliated

with

now

and

CITY, Mo.—H. Earl
Mary J. O'Banion are

affiliated with E. F. Hutton &

Company,

110

Cook

was

Mr.

poration.
Burke

a

still ahead of the like month of 1956 by

$1,100,000,000.

Department spokesman observed that the lesser
inventory value indicated "some liquidation" among
manufacturers in response to the easing off of business. Business
in

inventory accumu¬
increase over 1955
totaled $4,000,000,000, he said, while the increased value of busi¬
ness inventories for the first nine months of this year was running

generally has held a cautious attitude toward
lation all this year, he continued. Last year's

at

an

$1,500,000,000.

showing was made in the automotive industry last
operations brought pas en^er car amenably
United States plants to an eight-month high for the period.
A

week

in

annual rate of only about

good

as

a

9% jump in

Automotive

stated that the 137 404 cars
past week compared wi+h 126,139
week in 1956 netted 132,087
nits.

Reports"

scheduled for construction the
the week before.

T^e sar^e

week operations were the highest s^na -March
18-23 this "year and 50% of the industry's assembly plants which
embraced Ford and General Motors were still on a Satu-^ay over¬
During the

KANSAS
Cook

on

A Commerce

increase

"Ward's

Federal

Serving Investors

of manufacturing and

slightly by $100,000,000 over August on a

Total manufacturing

(Special to The Financial Chronicle)

CHICAGO

.

departments said the October drop in manufacturing em¬
was the tenth consecutive monthly decline after allow¬
for normal seasonal fluctuations.

to'Sept. 30,

Two With E. F. Hutton

•

,

The

The book value
up

(Special to The Financial Chronicle)

Members

ANGELES

Employment edged up 300,000

ployment
ance

Dean Witter

LOS

the agencies said.

year ago,

,

Miller With Reynolds

Building, members of the Detroit
Stock Exchange.

•

a

and aircraft.

in

an

,

Armstrong, Jones, Lawson &
White,
Incorporated,
Penobscot

FRANCISCO

anthracite mining,

up

tinue to be

Thomas

circuit to Honolulu

in

layoffs

temporary

for

water, but
bounds—all

suggest that DNR

(Special to The Financial Chronicle)

SAN

of

because

primary metal and apparel industries, the department said.
A joint report by the United States Departments of Commerce
and Labor pointed out that unemployment remained steady at

card

tors

and

company

DETROIT,

Private leased radiotelegraph

1,284,000 for the week

This was up 44,600 from the previous week and
385,400 from the year-ago week, it declared.
/ Pennsylvania reported the largest increase in initial claims,
ending Oct. 26.

wind

treading
leaps and

the fact
that's not
growing by

gossip;
a

With Armstrong Jones Firm

'

That increase,- said the agency,
76,260 higher than the corresponding

was

shares may not be sufficiently sea¬
soned for your taste, but you might

the merger
that here is

DISTRIBUTORS;

&Co.

about

normal, but
figure in 1956.

pace

Union Security Company, 29
La Salle Street.

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

high, it stated.
employment in the week ending Nov. 2, the
States Department of Labor reports,
saw 278,200 new
for
unemployment compensation filed, an .increase of
of

since mid-September to 66,000,000, about the same as a year ago.
Nearly all of the October gain in employment, the joint re¬
port added, came from a recovery in the farm work force, much
of which was idled by bad weather at the time of the mid-Sep¬
tember, report.
/
This gain was tempered by widespread reductions in manu¬
facturing, the departments said, particularly in steel works, foun¬
dries and plants producing metalworking, electrical and general
industrial machinery. Job declines also were reported in house¬
hold machinery and appliances and in transportation equipment

(and, inciden¬

New York Stock

annual

state

17,100 from the previous week.
was

speculators.

of expan¬
and in profitability;

both the mill and steel

»

sqrt of stock that excites

imagination'1 of

The

year-end lethargy

a

,

doubt that DNR

no

heading into

ing down steel output, "The Iron Age" reports.

merger, on

CHICAGO, 111.—May H. Riordan

BROKERS

J

■

user level hold¬
It has estimated
semi-finished and
/finished steel and are now; working off some of this stock to
improve their cash position for year-end financial statements. >
Steel users, of course, are still living off inventories as much as
possible, it further notes.
;
/.
C
"
\
Mill inventory cutting strikes another blow at the alreadyreeling iron and steel scrap market. In a situation of this kind,
the mills are generating more scrap from their own operations
on the one hand
and using less scrap on the other. So there is
.less need to'buy scrap on the open market, this trade weekly
-declares.
/
//
■*" ■
The automotive industry which plays a very important role
in the steel picture advanced its output by 9% last week, according
to "Ward's Automotive Reports," bringing passenger car assembly
operations for the country to an eight-month high for the period.
Operations were the highest since the week of March 18-23 this
year, leaving 50% of the industry's assembly plants in the United
1- States still on a Saturday overtime basis.
Construction
outlays in October slipped seasonally from
September, but they were the highest for any October on record.
Private outlays for public utilities reached a new high for any
month, while industrial building contracts dipped somewhat. The
United States Departments of Commerce and Labor predicted
that total outlays for construction for all of 1957 would reach
$47,000,000,000, the highest on record. This would be the twelfth

with inventory cutbacks at

current
impediment to
an icy analysis of the
quid-pro-quos.

present

has

•

Index

Production

the mills have built up about a million tons of

consecutive

logical, would depend importantly
on
the market
relationship be¬
tween the prices of the equities
in each company.
Since Diners'
Club

:

:

hear, some talk
of a possible merger between
Hertz Corp. and Diners' Club, Inc.
This corporate blending, however

(Special to The Financial Chronicle)

UNDERWRITERS

Industry

The steel market this week is

we

control,

Complete Investment,,

Auto

Business Failures

~

clear sailing.

the American Stock Exchange. It
really caught
Ira U
Coblcifb
watch, or per¬ on, however, individual member¬ is actively traded there under the
haps a ring as ship is zooming ahead, and eating symbol DNR and has ranged this
a
and a
hostage? Possible, but embar¬ establishments, instead of being year between a low of 16
rassing and usually rejected. Or solicited, write-in to get on the high of 46. 1957 per share net is
estimated at around $3. A 2-for-l
make a frantic phone call to some¬
membership bandwagon. This is
one you know to cab over, pronto,
obviously a sound idea and it has split of the common has been an¬
with the bail money?
payable to holders of
created a dynamic company with nounced,
record on Nov. 25, 1957. The divi¬
Well, dry your eyes! All that is a remarkable growth rate in both
dend on existing shares this year
now a thing of the past, thanks to
gross revenues and net earnings.
that

Food Price

and

enterprises to have rather
It is not to be ex¬

ing

Now

resistance.

sales

Trade

Commodity Price Index

bers of its members and subscrib¬

addresses and solvency on
and those habitu¬

names,

happened, to many of us. You
to dinner with milady,

sit down

Carloadings
Retail

State of Trade

but
seems
now
to
have gotten, far
enough ahead of the pack in pres¬
tige, performance, and the num¬

some

Electric Output
V

had competition and imitators,

Offering

Steel Production

;

West

10th

Street.

formerly with

Denosit

Tnsura^c0

Misc 0'Pc>nion

& MacDonald.

was

+he

Cor¬

with

time basis.
The

statistical

service

last week as against

counted truck

output at 2*

|17 units

"Wa

' " com¬
-minated

21,226 in the week preceding.

mented that "The fact that truck

production is bein*
CnrtirmiPfl

p*

rxidP

3.5

Volume 186

Number 5690

The Commercial and
Financial Chronicle

...

(2105)
business

value

elements

of

the

listed share to be dwarfed in imtheir

Observations

ing attitudes

.

whole.

as a

of market

By A. WILFRED MAX

discussing stock market

capability,

let

first

us

fore-

consider

the proper place of
forecasting in
the

investing

process.

Second, the

izing it,

the remarkable
the popularitv of this

in

predicS is

category of
in the literature

of

security

a

kind

a

doubt, they

no

of

Take the uncertainty of the tax
legislation which will be passed
in the next session of the
Congress

catching, better
u
results were gained through
longcontinued holding
in the same
issues, as the Blue Chips in the
""

—particularly if
a

house

^

Coppering

lic Wil1 subsequently

the

cause

offered

^
sult

threat

from

aAllleullcllL
_
armament,
needs,
wafJe.Drjce spiralling or
fi

Trim anU-deSon
depression

oi

size

the

to

inflation

short-term

whole-hog dollar depreciation

market
by the

varying

the

the

fore¬
caster with another dilemma. Will

the Professionals

the

by

tops,

confronts

„

Advisable

...

should be in

we

depression.

Currently, popularized

Dow-Jones average,

dealing

are

recent
that in-

a

swing

?xtent. *> w£ich their ,/ellpW pub- Streets professional element k

evident

bein" broad-

now

market

stead

in prices instead of dealing in
Further evidence of the
va\ue> attempting to 'anticipate the forecasting shortcomings

Typically,
growth

the

substantiated by
study, shows

exhaustive

of counter in the ebb and flow of
market movements. Without real-

ON MARKET FORECASTING AND
TIMING*
In

toward

In their false concept

liquidity, the forecast-

make

ers

rapidly chang¬

record,

5

re¬

from

perhaps
by

imeasures

the government; oiyonthe other
hand will these inflationary ele¬
ments be counterbalanced

by the

nation's

enormous-

productive

pacity, credit restriction-.and
1 i

c

i t i

v

e

s.

Third, weighsults in actual

advisory

services

seemingly

Pasting, arid Blue Chip-itis (which their enlargement at^market bot-

be-

ing directly proportioned to the
embodiment of the crystal ball—
the public loves it!

vestment

practice which

have

been

actually
achieved by
various

cate¬

gories

of

ex-

Reasons for Popularity

Now, for its motivation.

mnvptnpnt"

mruinE
evitable.

Fourth,

market

the

reasons

w-m?S*tlve.r
rejjults ln""
Fifth, the fundamental

fallacy of the concept of The Mar¬
ket as a single
entity, and the con¬
cept of a trend, and;
Sixth, the
alternative of a sound
investing
approach.
It

amount

course

true, that

some

at

in

contrast

to

value1'analysis.

'Technique

,

*
charti

n

—

of the Atlantic, has been
aptly described by that ubiquitous
economist, Lord Keynes, as fol¬
lows:

the

valuation

of

"Professional

be

may

likened

to

investment
those

news-

analysis

competitions in which the
competitors have to pick out the

individual

six prettiest faces from 100
photo¬

paper

-

and

both

on

sides

approaches, such as the ability and
rigorous self
discipline required
business-like

of

forecasting is present securities which we are detail- graphs. The prize being awarded
in all our
to the competitor whose choice
activities. In
conducting- *11*? *n this course. The popularity
a commercial
business some
risky' of forecasting via market systems most nearly corresponds to the
participation is engaged in, or at alRO stems from disillusionment average preferences of the cornleast implied,

in the automobife

as

fail

to

the

after

forecasting

general

about

individual

se¬

curities.

fact, Wall Street
including these

so¬

In

phisticates,

perts themselves

are

and the price level existing

level until 1946 following another
World Wan So, even though you
may have. an
inflation
over
a
hundred year cycle, there can be

intervening

ex¬

to

prone

going

use

ods

"bucketing"—that is, acting con¬
trary to their own experts' major¬
ity forecasts, as a guide to the
market's

casting

future.

bull

is

At

their

sessions,

the

manufacturers dependence on an- comings v
nual style
acceptance of his new' general economic predictions. The

models; and as is often inherent- ■■mental gymnastics involved
in
in
financing arrangements. And~contcrnPlatin£a pictorialized mar-

in

the

fore¬

surest

"bucketing."

and

Must

Now,

productive business

forecasting

is

and

farming,

engaged

in

as

an

not

a

case

ox

indoor sport. The illusion that it of

one s judgement are really the
prettiest, or those which average

1S easy to beat the game, to follow

unavoidable necessity, as incidental to the major
productive effort,

®bi*oii Rothschild s advice to buy
sheep nnd sell deer by catching
and is usually minimized as
much;
swings with tours de hindas
possible.. In investing opera- sight in lieu of tours de forcetions, on the other hand, while Slt)ht. This normal ambition seems
some

jx as

assumption about the future

be irresistibly fostered by one's

of course must

-

a#c opinion to be.

And there

are

some, I be he ve, who are practicing the fouitb, fifth and higher
degrees.
And there I give you

able.

of

the

Furthermore. an important
standard in determining whether
is

one

acting

ulator,

spec-

gambler is the relative

or

emphasis
The

investor,

as an

placed

closer

i

_

*-■*

forecasting.

Let

us

Boom!

Prophets Boom
talk

now

markable

direct

investment

an

on

1920%

its

boom

Wall

re¬

to

the

Street

business

has

as

had

since the halcyon

ever

"forecasting

assuredly

the

contrast

depression which
off and

about

.

of the Prophets

growth

In

has

division"

been

which

enjoying a
continuing and

is

unceasing.

■'

The attempt to forecast changes
in

security prices

of

factors

such, in

lieu

attention

on

as

concentrating

value

(as outlined

in

analysis

ket analysis is of two kinds:

that

considering all kinds of

eco¬

nomic, business and political fac¬

tors; and second, that which, via
the so-called "technical"
approach,
finds the

data

for

its

predictions

exclusively in the past performance
of

the

charts

market

itself

plotting the

dividual stocks
and

based

that

the

on

or

the

market

(as

through

action

of

in¬

the averages)—

major premise
is

its

own

best

forecaster..

of

^

Social

Research,

at

one

th«*

New

of

a

New

York

current,

School

City,




Game Appeal

e

'.^1

•

ii.

_

to afford

seems

appeal

as

a

i

.

prevalent neglect
factors — epito¬

been

so

Chip-itis which

i

game

a

measure

such—

as

let's

take

look

a

tice.

that

So

engaging
in
1A4
fit/Mi

tic

we

an

also
the

-----

■"

in prac¬
not

are

is certain

which each of the

to

lose, but in

players—hoping

it will not be he—meanwhile has
a

good

time.

(As I inserted here

when I compiled these notes last
July), I'm assuming that you're
not always going to have a bull-

market
year

or

the

benefit
in

movement

Another

of

direction,

one

major stimulus

activities
and

fore-

to

stems

prevailing

five-

a

from

the

over-cm-

just

•

'it-

*t...

_

tempts to discern
lieu

•

_

...

i

•

price

.

_

..

trends

Ttroiffh

iirLof

typically

ln their complete

misconception

of the basic nature of the

common

stock, t^f market timing technicians blithely overlook the fact
that, essentially, as I pointed out in

last lecture,
listed

on

different from

a

an

ness

not

a

listed;

share in

a

busi¬

the

market effect, is enormously dif¬
ficult to anticipate since psycho¬

forces'- so largely govern
participants' reactions

Psychological Imponderables

and

caster who turned out to be

out¬

rect

in

another

are

had occurred after alt previous
Continued

concerned.

on

page

Comptroller of the State of New York.

as

York State Thruway Authority

agent of New

will sell at his office at

Albany, New York,

.

on

November 19, 1957, at 11 o'clock A. M.

$50,000,000
New York State

Thruway Authority

State Guaranteed Thruway Bonds
(Sixth Issue)

results., Similar negative results
in
predicting
and
interpreting

dents

at

At i

Columbia. E.

n

F.

in

the

Columbia

Further

Under¬

School of Business.

indications

of

the

by the State of New York
Dated December 1,1957, and due

ex-

perts' trend-forecasting difficulties
is furnished by the performance
of
those
investment
companies

serially in various amounts from

1985 to 1995, both inclusive.
The Bonds will be
to

their

and

subject to redemption by the Authority, prior

respective maturities,

after

July 1, 1965,

as a

upon

whole

or

in part at

any

time

on

certain terms and conditions, in¬

cluding specified redemption prices.

on

wood and M. C. Nelson, under the
direction of Benjamin Graham at

cor¬

expectations of high*
economic
activity instead of a
demobilization depression such as

Principal and interest unconditionally guaranteed

of the time—in other words, cointossing would have yielded better

suc¬

his

tact, these experts' forecasts were
found to be correct less than 50%

which center their efforts in tim¬

cause

uet^ ii ^t

^^Vdouble
pred^ct.on
of which, namely the

second

and of Dow Theory practitioners,
bave been generally fruitless. In

ing the market movements of the
standard
issues.
The long-term

and

illustrates

effects

The

of, in two major studies found
that the forecasting efforts of
financial
publications,
services

busi¬

a

a
the

VIIP1

exchange is not
share in

tax

mar¬

ket's performance—- which is an

cessively opposite market effects.
For example, in the period fol¬
lowing World War II, there was
the minority view business fore¬

relevant

The

First

■

investor

mission for Research and Economies, which you have all heard

oc

in

moves.

a

forecaster

double' "bet."

Identical events often have

important imponderable as far as

sipn, let us weigh what has ac¬
tually happened in market per¬
formance
and
assay
the results

_

of value factors.

foretelling
highly

a

the

to borrow

—

term. * The
a

talk

call

academic discus-

phasis
on,
and
misconception
about, liquidity. So-called market movements of the market as a
liquidity is a prevalent concept whole, in contrast to their fine
which
i«?
completely
dangerous work in analyzing individual isand invalid in identifying market sues, were arrived at in brokerage
linnen'o
rtniniAn
f
el
price with value, anH in concen¬ house's opinion, as found in an
trating investors' efforts on at¬ extensive survey made bv two stu¬
—-

of

the

to
I

to the external events.

short-term market forecaster wit

necessity

what

events in terms of the stock

The

rising government intervention-'
inciuding defense spending
nnntinuineiv confronts the
continuingly confronts the

the

like

also, equally important and even
more difficult, the effect -of these

logical

look, always politically governed
at

win

Parlay

a

the market

tt/l-iirh
which

interpreting

25

to

he must be correct in foretelling
not only the external events; but

j

playing the market as in indulg¬ that have been achieved in the
ing in a contest of trving to out- market place by various categorguess
the crowd.
Stock-market *es of forecasters.
-Fortunately,
playing, as an extension of market tbere are available findings along
forecasting may be likened to the this line which are disinterested
game of musical chairs in which
and reliable. The Cowles Comsomeone

attempts to time market

First, Ict us
consider predictions based on external factors; Political, economic,

Washington

overdone.

must

movements must fail

value

mized in the Blue

has

.

results actually achieved

_

liberal

a

se¬

for

_

The Actual Results

Then there is the game appeal.
Forecasting of all varieties, and
certainly in
the
stock
market,
of

,

the

to

logical

Now

my
from

lectures

kev

.

„

ness

^Transcript
ries

easy to

the

foresight!

as

present

first,

tech-

„

thought in rationalizing hind-

S1£ht

on

distinguished
security analysis. Such mar¬

from

easy

casting

as

dopesters

have caught
the up-and-down swings," is the

my

last lecture) is generally based
market

"How

™que.

one

I.

form

prediction.

on

approaches
a
genuine investment
attitude, the
more will
forecasting, along with
+
other risks, be minimized.
Con¬
versely,
the
speculator-gambler
dealing in risks, concentrates on

That

racing

,

months

entirely different thing. Like the
difficult feat in horse -racing of
winning
winning a
a parlayed
paiiayeu bet, he must

opinion geneiafly thinks the prctaj-^ financial. Such incidents have
tiest, we have,lcached the third
i-angrcd
all
the
way
from
the
degree where we devote our in- president's heart attack to
Sputtelligcnce to anticipating what j^jj- Number One. A more conaverage opinion expects the avci- stant imponderable is the steadily

be made, the in- fasy. reflection
v^h d^r d-nna.
unifv stresses
sti*pssr*c the
fhe inf» over past-performance charts
community
forecasting- elements far beyond lhat depict sharp, but completely
the incidental and the
unavoid- irregular up and down swings like
vestment

h

about

track

race

my time limitations, 1
only outline a few of the rea-

gons

Win

would

parlayed forecasts

along

Within
view.

I

moment

These

analysts,

three

And this has similarly oc¬
curred in other countries, as I will
show in next week's lecture.

,

as a whole.

oi

from

to

economists

can

pout

<* counter^- movements
unpredictably for peri¬

on

of

years.

"copper" the majority
opinion; and the greater the ma¬
jority, the more confidence is
there

nnp-wav

that time, prices declined and
remained lower for 25-years and
didn't get back up to their 1921

market

conclusions

a

aj

efforts of the

the

are

j~

the First World War- from

P^essionals

bottom;., Likewise abortive

economists, statisticians and ana¬
lysts, who .are so able in forming

bet

prevalent emphasis on. inflation—and the assumption that in¬
fia+jon

with the services, are highly suc¬
cessful in evaluating individual
So, each cornissues on quantitative criteria, in
petitor has to pick, not those faces
contrast to their ineffectiveness in.
which he, himself, finds prettiest
^eneraT forecasting
but those which he thinks likeliest
to catch the fancy of the other
Reasons for Failure

petitors

well-publicized shortof past business
and

"over

u;?rd,s'

~

going to think and do,

are

when supported by
g, supplies a welcome

emotional escape from the diffi¬
culties involved in the alternative

the

'

guessing
what his fellow investors
»

particularly

professionals

movements

The investor's inordinate atten¬
tion
concentrated
style-wise v on

so-called

the

anticipate market swings. In other

in
Tourth Degree Beauty Contest

gauging
the action of the market as a
whole. First, an ordered
system,

for

is, of

usually bullish at the top andare
beaush

to be a variety of
reasons,
mostly
psychological,
for
such
popularitv of the prophecy sys-

particularly of the
to ."technical'' methods of

attempts

*

all

There

seem

P^lts in their tern,
.

i°™S
Ions-of

community has become
engaged in a kind of strategic
game — like
Machiavelli's
prac¬
ticing of the second degree lie—

ca¬

gen-

Principal and semi-annual interest, January 1 and July 1, com¬
mencing January

1,

1958, payable at the principal office of The

Chase Manhattan Bank, New York.

Copies of the Act and Resolution authorizing the Bonds, Official
Statement, Official Form of Proposal,

Notice of Sale, and form of

opinion of Attorney General will be furnished upon application
to

The Chase Manhattan Bank, Fiscal Agent, 43 Exchange Place,

New York 15, New York.
ARTHUR LEVITT, State
Dated: November 12, 1957

.

,

Comptroller, Albany 1, N. Y.
.

-

-

*

,

,

••

37

The Commercial and, Financial

€►

Chronicle... Thursday,

November 14, 1957

(2106)
itself with a particular political
all concerned, union as an institution formulates
its
administrators party."2
expect union objectives,
should either carry out the neces¬
leaders to
oppose employers * in
Would Repeal Political
the negotiation process, not sell sary steps or resign or. be dis¬
Contribution Law
charged. For union officers, like
out to them.
Professor Richardson's reference
corporate
officials, agree when
Unions Are Not Public Agencies they take their posts to act in ac¬ to political considerations should
be emphasized.
There is really
It
should
be noted, however, cordance with the duly formulated
very
little wrong in permitting
that in the general juridical and and authorized objectives of their
a genuinely voluntary
association
social
structure
of the United- organizations. The same is true of
rank-and-file
worker, and to use some of its funds in polit¬
States the responsibility of unions ' the
In fact, as the sad
union member. He too in joining ical activity.
to workers is not a responsibility

Moreover,

ents.

Compulsory Unionism and

_

Responsible Unionism
By

SYLVESTER PETRO*

of Law, New

Professor

Author:

York University

School of Law
Society"

Policy of the Free
Ronald Press, 1957)

"The Labor

(N. Y.:

union membership,

Prohibition of compulsory

though only a

laws

is depicted by law professor Petro,
the part of society to the mani¬
fold threats posed by big unionism. Professor Petro admits
there is no guarantee that strictly voluntary unions will run
themselves well and will pose no danger to the free market
economy; but, he points out, the elimination of force and
coercion should bring about a healthier state of affairs for the
union members and the economy. Denies right to work laws

far

constructive response on

a

monopolistic unions.

wide
framework

The

this

of

paper

put in terms , of the
familiar propositions of two great
19th Century figures, Lord Acton
and Mandell Creighton, his cor¬
he

may

I refer, of course,

respondent.
the

case

as

in

and'
corrupts ab- -

tends to corrupt

"Power

absolute power

solutely."

boycotts."

—

runs

in

this

employment arrangement at
which the right-to-work laws are
directed. The topic assigned to me
was
"Right-To-Work Laws and
of

"Society is an organism and
its laws are an expression of "
the conditions which it con¬

for its own

preservation."
Compulsory unionism, the insti¬
tution which the so-called rightlaws

to-work

designed

are

to

extirpate, is of all the nonviolent
techniques of trade unionism the
most

significant means to power.
nowhere in
of action of mortal men;

area

Acton's decla¬

and to that extent

precision. Yet,

ration is wanting in

while union leaders are as

other

as

men

unable

to command absolute

the power they do build
compulsory union¬
ism is of such magnitude as to
threaten the integrity and there¬
power,

with and upon

fore the existence of

a

free society.

Viewed in this light, the right to
work laws must be
seen
as
an

expression of the conditions which
this society considers necessary to
its

own

preservation.

Before

developing the thesis,
however, I wish to observe that
if

compulsory unionism is the evil
at which the right-to-work laws
are aimed, they fall considerably
short of the mark.
For compul¬
sory

unionism

forms

than

agreements
union

takes many more
the
union-security

(the closed shop, the

shop,

preferential

and maintenance of
at

which

the

hiring,

membership)

right-to-work laws

strike.

Workers
are
frequently
compelled to join unions by these

agreements

which

make

union

membership a condition of em¬
ployment; Quite possibly, though,
they are even more frequently
compelled to join through the use
by unions of the types of pressure
tactics known loosely and vaguely

"secondary boycotts."
These
too, like those of, say,
the
closed-shop agreement, are
designed to make union member¬

as

pressures,

ship

a

condition

of

employment.

Ultimately the
is

the

you

cal

mode of coercion
"Join the union or

same:

don't work."
stranger

So, in the typi¬

picketing




case,

expenditures by trade un¬
legal control of

his

argument

to an overwhelming

up

against compulsory unionism, not
in its favor. No business firm in

should note that law¬
a
position in the
juridical structure which clearly
distinguishes
them from
trade
unions or, indeed, any. other eco¬
ment,

one

occupy

yers

the

Judgment

association.

nomic

on

merits of the intergrated bar

spend member¬
contributions in ways con¬
trary to the desires of the mem¬
bers.
Since direct legal control
ship

there

event

seem

I

aware

am

that the

reverse

of

find,

with a competitor of
employer—a:firm in more

work

his first

same

ing

as

the

verse

itself.

Lack of power

the ab¬
tends to cor¬

tends to corrupt, too; and
solute lack to power

rupt absolutely. It tends to make
persons contemptible, at least, if
not
corruptible.
If associations
of workers are to be responsible,
then, they must have some power,
of some kind. Yet if they have too
much

power,

of the

equal responsibility
to all workers.
The consequences
of such
an
identification would
anomalous

be

an

contradictory

extreme

Cannot

is true of corporate of¬

If

the

'

is

regarded

as

of

membership
quences

The

—

follow.

certain

a

conse¬

Restricting

our¬

problem can be solved, I
selves for the moment to union
believe, by reaching an under¬
responsibility to the membership,
standing of what is meant by "re¬
we should note
in the first place
sponsible unionism."
Most will
that in unions, as in all private
probably agree that what is meant
associations, the ultimate check
is responsibility to workers and
which
members
have
on
their
responsibility to society at large.
leadership lies in the freedom to
Most will
agree also, I believe,
shift their allegiance when dis¬
that when we speak of union re¬
satisfied. The law of fiduciaries
sponsibility we mean to exclude
has much less to do with the per¬
coercion, compulsion, and exploi¬
formance
of
corporate manage¬
tation of workers; extortion from
ments, such as it is, than the fact
employers; and antisocial, monopthat stocks once bought can be
olistically established wages and
sold.
Nothing could possibly be
prices. If it appears upon exam¬
of
greater efficacy in inducing
ination that compulsory unionism
union officers to perform respon¬
clashes
with this conception
of
sibly than the freedom of workers
responsibility, we shall have to to shift their affiliations as dis¬
conclude that the relationship be¬
gruntled stockholders may and do.
tween right-to-work laws and re¬
This freedom
is drastically im¬
sponsible unionism, is a positive
paired if such a shift must be, as
one—to the degree, at any rate, to
it is under compulsory-unionism
which the right-to-work laws tend
conditions, at the expense of one's
to prevent compulsory unionism.
job. As a careful student of labor
When we say that unions have
relations in Great Britain, Pro¬
a
responsibility to workers we fessor J.
Henry Richardson, has
usually mean, I believe, that union
quietly observed, "union leaders
officers ought to be preoccupied
may be less considerate of their
essentially with promoting the in¬ members' interests if workers no
terests

of

workers

their
who

constituents—the
have

joined

the

union and designated it their bar¬

instruments

compulsion

and

now

pected what has been going on.
Indeed, all one need know is that
unions have the kinds of power

predicted on a priori principles.
In this sense and to this extent
Acton's dictum is relevant.
No
human agency having the virtual
be

had
de¬

avail¬

industry-wide employer control
does
not
exist,
industry-wide
unionism is even today almost a
,

general rule, and universal indus¬

that

good

many

finds

a

the

Almost every¬
goes in a

goal.

known union
where

is a well-

unionization
a

worker

industries

union

in

today, he

power.

Under

conditions of compulsory un¬

seek

unions

which

ionism

and the rest may

that they have,

long — universal, industry-wide
compulsory unionism.
Whereas

try-wide

of the current inves¬

of the conduct of some
trade-union officers. Yet anyone
who has had his wits about him
must have known or at least sus¬

before

degree

greater

.

tigation

mightily

ever

Surprised

am

the findings

able, and which they

an

of its

the interests

of

Not

perhaps less stunned and
shocked than I ought to be by
-1

struggle so
to retain, trade unions
already
have in large measure
and will undoubtedly secure to

private association —
committed primarily to the ad¬
vancement

the

With
vices

Membership

Leave

union

private association, has ever
or can have in our system.

voluntary,

kind,
Acton's

point becomes relevant.

and

degree, as only a
moment's reflection will indicate.
in

wrong

derived in the wrong way,

an

his livelihood.

up

business.

less the same line; of

or

The

which unions have to their mem¬
bers with

lie in repeal of the law

to

prohibiting political expenditures
and enactment and enforcement
of laws prohibiting compulsion to
membership.
Then
the * person
distressed by the use of his money
ployer is free to quit and to seek to advance repugnant causes will
have the right—as every free man
work with any Mother; firm. > He
should—of resigning without giv¬
will more often than not seek and

„

Acton's theorem is about as sound

would

solution

the

impossible,

little

is

extremely difficult, if not

seems

suspended,

be

must

membership and

power to compel
the authority to

properly understood, they add

are

hopelessly

misguided.
Yet tliere is almost
everything wrong with allowing
an organization to have both the

considerations

these

is

expenditures

such

Sees No Analogy

when

is revealing,

ions

this country has the authority to
churches, social clubs, or any of
the
other
private
associations^ compel anyone to invest in it or
branches of the state.
7 , to be employed by it, either, as
rank-and-file worker;, or admin¬
Some states have gone in thaC
istrator. Furthermore,; any worker
direction
with their "integrated"
dissatisfied with the- pay or the
bars"; but, in adition to the ex¬
working
conditions: of * his; em¬
perimental nature of that move¬

the
When
union's objective is to proscribe gaining representative..
workers choose union representa¬
the
picketed premises; bv dis¬
tion they expect that their union
couraging pick-ups and deliveries
—in general, by inducing second¬ will reflect their wishes,, act in
their behalf, and attempt to secure
ary work-stoppages — the union
from employers
the best wages
seeks to put such pressures upon
and working conditions, the best
the employees and the employer
and
fairest treatment,
possible.
that all
resistance
will be
Union
leaders
are
expected to
squashed.
Precisely the same is obey the laws of the land and the
true of the kinds of action known precepts of common morality; to
refrain from lying, stealing, and
"An address by Professor Petro at the
cheating.
At least they are ex¬
University of Chicago Law School Con¬
pected to refrain from lying to
ference on
"Fiduciary Responsibility in
and stealing from their constitu¬
Labor Relations," Oct. 11, 1957.
-

of the law

litical

membership or job.

But

prohibiting po¬

career

ficials. They too usually go to a
but in any
occasion to competitor; or they-will some¬
times set up a competing firm.
reason from what has been done1
Responsible Unionism." Yet I find with associations of lawyers to
But
the authority
to compel
it necessary, in order to deal ade¬
unions seek
what may be done with general membership which
quately with the problems raised
would place them, ultimately, in
employee organizations.
by that topic, to
broaden the
the position of, the-; state—in a
In this society, there is only one
analysis, and so I am changing the
association in which membership position which would give them
title of this paper to "Compulsory
as
close
to absolute
powers
of
is compulsory and universal; that
Unionism and Responsible Union¬
association, is the state. The state compulsion as exist in the real
ism."
world. They seek, and will prob¬
alone has responsibility in respect
of all. At least at present, there¬ ably achieve, if not restrained, a
degree and scope of power which
Responsibility, as Between Union fore, it would be erroneous to
no (business
firm, 01* any other
confuse
the
clear responsibility
Leaders and Union Members

Absolute power exists

the

inheres as much
tactics to which I
just referred as in the types

the pressure

have

way:

siders necessary

in compulsory

through economic coer¬

cion, therefore, it

„

germane

more

-

If there is an evil

unionism

Creighton's statement—possibly
even

"hot-cargo" agreements, black¬

listing, secondary strikes, and, to
use the broadest term, "secondary

dictum:

of Acton, to the

we

job agrees to
union or em¬

a

to resign, or to lose

prepared

public agencies, anymore than
have
made
business firms,

ine

unions"; believes freedom of members
to resign would make their officers more responsible and
foster responsible unionism; and hopes it will end industry¬

taking
to his

or

"loyal"

ployer; and it is understood that
if he cannot be loyal he must be

government. Although the ma¬
jority-rule principle in collective
bargaining is a step in that direc¬
tion, it is quite impossible for us
to
go
the whole way without
vitiating the basic political prin¬
ciples of this society. I doubt that
we shall ever make unions genu¬
of

designed to "bust

are

to

as

be

traditions

or

union

a

Nothing in our
goes quite so
make unions a branch

workers.

all

to

fragmentary corrective,
as

included,

workers

to

maintain, and which the-right-towork laws combat in part, what

both

of

privilege

physical and

coercion,.can escape a
of corruption.
Establish an environment perme¬
ated with coercion and compul¬
economic
material

degree

sion and you are
men

they

not

do

bound to attract
arts; if

excel in those

who

excel at first, they
learn or make

will either have to
way

for more talented men.

who

who

to

are

to become

had

have

tomed

do

accus¬

being pushed around,
subject to the rigorous

controls of compulsory
can

This

Workers

complicated.

is not very

unionism,

nothing but bear the op¬

pression and exploitation

of their

leadership.
It

is

as

absurb

to

expect

re¬

unionism in conditions
of
extensive compulsory union¬
ism, as it would be to expect

sponsible

responsive
ernment

responsible gov¬

and

in

a

society where the

dic¬
proletariat is the
responsible
central
political principle.
If
I call here again upon the ob¬
union leaders are to be responsi¬
servations of Professor Richard¬ ble. to the membership, they must
son.
He points out that:
be agents subject to the members,
"Operation of the closed-shop not their masters. When men are
principle denies the right of work forced in the first place to join
people to withdraw from a union unions, forced in the second place
to go
in the future if they have become
along with all plans and
dissatisfied
with
its
policy or programs conceived by their lead¬
leadership. It also stands in the ers, and forced in the third place
to keep their peace if they wish
way of the formation of rival un¬
to keep their jobs—it is not at all
ions.
Yet the right to set up a
rival union is included in free¬
surprising to find a good many

are

the

dom

of

of responsive,
unionism?

prospects

association,

and

to

take

this right could weaken the
vitality of the trade union move¬
ment. Groups of work people may
away

divine

right of kings or the

tatorship of the

trade-union

leaders

less

than

responsible to their membership.
The same is bound to be true in

any human organization.
Power
different views upon grabbed by force and exercised
trade union policy and methods,
subject to no pervasive structural
longer have the safeguard of leav¬
or
functional check is bound to
and if they cannot reach agree¬
ing the union and still be able to ment
they are likely to form sep¬ corrupt, and if the free society
find wcu
*
arate unions.
Again, where wishes to preserve itself it is go¬
It is sometimes ..aid that unions
only one union has hitherto oper¬ ing to have to take that power
need the power of compulsion in
ated some of the members may in hand somehow. This, I believe,
exactly the same way that any consider that its policy and lead¬ is what accounts in part for the
other organization needs it if ob¬
ership have become too extreme spread of the right to work laws,
jectives are to be attained.
No and aggressive or too complacent
n
corporation could get anywhere, and spineless, and if they are un¬
this argument runs, if those
in able to bring about a change from
Social Responsibility
charge did not have the power to within, they may cease
to be
Now, as to the social responsi¬
command
the full obedience of members or
may decide to form
bility of trade unions, although
administrative officers.
a
rival union.
Differences may
we hear a lot about "labor statesFew
will deny that when
a
arise not only on the industrial
Continued on page 26
1 J. Henry Richardson, An Introduction
policy of a union but also on the

hold

quite

.

to
p.

the

188

Study

(1954).

of

Industrial

Relations,

.

.

question of the union

identifying

2

Ibid.

J




This announcement is neither

an

offer to sell

solicitation of offers to buy any of these securities.

nor a

«The offering is made only by the Prospectus.

'

NEW ISSUE

November 14, 1957

1,000,000 Shares

:.

Transcontinental Gas
s.'.

't

;

V

^

•

v

.'.W,

•

?,

>;"• v^-Y".i (Par Value 50$ per Share)

" Copies of the Prospectus

Price $17.75 per

be obtained in

may

writers, including the undersigned,

White, Weld & Co.J

Blyth & Co., Inc.

]•.,

>'

•

.

.

;•

■

Hemphill, Noyes 8C Co.
'

•'

;•<

*.•

American Securities

*";•

;

,

Shields &
"

:;V

.

' "

an

The

Dominick 8C Dominick
The Ohio Company

Moseley 8C Co.

F. S. Smithers & Co.

Spencer Trask &. Co.

*
ti»

This announcement is neither

Hallgarten & Co.

A. C.Allyn and Company

Clark, Dodge 8C Co. >
F. S.

Company
■

Tucker, Anthony &. R. L. Day

ISSUE

,

Incorporated

Bear, Stearns & Co.

^

'

NEW

.

Co.

•'

Lee Higginson Corporation

Laurence M. Marks & Co.

Salomon Bros. 8C Hutzler

V'*-

Dean Witter

'

Corporation

W. E. Hutton 8C Co.

Lynch, Pierce, Fenner & Beane

* ',1

■

Hornblower & Weeks

:
-

Merrill

-•

Equitable Securities Corporation

'•

,

Kidder, Peabody 8C Co.

>*•''. '•

Smith, Barney & Co.

-

Drexel&Co.
'

The First Boston Corporation

.

Incorporated

Paine, Y ebber, Jackson & Curtis

Incorporated

securities in such state.

Harriman Ripley & Co.

■"

•,

Lehman Brothers

A. G. Becker & Co.
'r'

the

Stone & Webster Securities Corporation

.

Lazard Freres & Co.

-

only from such of the several Under¬

lawfully offer

Goldman, Sachs & Co.

1'

li.•

any state

may

as

Share

Eastman Dillon, Union Securities & Co.

; ?

Glore, Forgan & Co.

Pipe Line Corporation

Common Stock

i-'

•-

-

,

.

f-

G. H. Walker 3C Co.

■

*•
■

offer to sell

nor a

1

*

solicitation of offers to buy any of these securities.

offering is made only by the Prospectus.
November

<•

$20,000,000

14, 1957

i

-

Corporation

Transcontinental Gas Pipe Line
6%% Debentures clue 1978
(Dae May 1, 1978)

Price 99.50%
Plus accrued interest from November

1, 1957

Copies of the Prospectus may be obtained in any state only from
writers,

including the undersigned, as may lawfully

Stone & Webster Securities Corporation

White, Weld & Co.

The First Boston Corporation

Eastman Dillon, Union Securities 8C Co.

Blyth & Co., Inc.

Harriman
Ripley 8C Co.
Incorporated

Goldman, Sachs & Co.

Glore, Forgan & Co.
"

Lehman Brothers

Lazard Freres & Co.

A. G. Becker & Co.
Incorporated

Hemphill, Noyes & Co.

Kidder, Peabody & Co.

Merrill Lynch, Pierce, Fenner 8C Beane
Smith, Barney & Co.

Paine, Webber, Jackson & Curtis
Bear, Stearns & Co.

such of the several Under¬

offer the securities in such state.

Drexel 8i Co.
•

Hornblower & Weeks

Equitable Securities Corporation

Hallgarten & Co.

.

Lee Higginson Corporation

Dean Witter & Co.

8

Gabriel Company

—Bulletin

—

DO Witt Conklin Organization,
Y.
;

J20 Broadway, New York 5, N.

/
'

on

equipment and inven¬
tories has j exceeded $100 billion.
In face of this record, corporate

plant and s

pleased
following literatures

\

_

^

Co.—Memorandum—Green, Ellis & Anderson,
Brodawy, New York 6, N. Y.

II.
61

It it understood that the firms mentioned will he

send interested parties the

Y.

porated, 25 Broad Street, New York 4, N:
R.

Macy

&

1 Wall

half

Production—Report—Western Securities Corp., 1
Exchange Place, Jersey City 2, N. J. Also available are re¬
ports on Three States Natural Gas, Delhi Taylor Oil, and

ington 7, D. C.
Born ham

able is current Foreign

173

Richardson

Co.

Review—Bulletin—Bums Bros. & Company Lim¬

Also available is

Bank

Building,

discussion of Municipal Bonds.

West,

Toronto,

Ont.,

Market Review—Wun
Defensive

Over-the-Counter Index—Folder showing an

data

are

f

Economic evidence examined

and market performance over a 13-year period —
National Quotation Bureau, Inp., 46 Front Street, New York
4, N. Y.

Discussed

current

in

"Market & Business Survey"—E. F. Hutton &

issue

Treasure Chest in the Growing West—Book describing industrail opportunities of area served—Utah Power & Light Co.,

recession, moderate in
nature as compared with severe
downturns in the past but def¬
initely more

89a, Dept., K, Salt Lake City 10, Utah.
•

serious

•

the
Acme Electric Corp,

—

Memorandum

Broadway, New York 6, N. Y.
American Machine & Foundry

—

—

Goodbody & Co., 115

•

,

Data

du Pont, Homsey &

Company,, 31 Milk Street, Boston 9, Mass.
bulletin

are

Also in the

same

data on Goodyear Tire & Rubber Co. and Jones

Laughlin Steel.
Foods

Co.—Analysis—Bache & Co., 36 Wall Street,
Also available is a bulletin on Electro¬
lytic Copper production.

New York 5, N. Y.

Co., 51 North

High Street, Columbus 15, Ohio.
Industries

Corp.—Analysis—Hay den, Stone & Co., 25

Street, New York 4, N. Y.
Co., 207 East

Michigan Street, Milwaukee 2, Wis.
Continental Can Co.—Memorandum—Robert W.
115 East Wisconsin Avenue, Milwaukee

Baird

&

Co.,

1, Wis.

Diebold, Inc.—Analysis—H. Hentz & Co., 72 Wall Street, New
York 5, N. Y.
Douglas Appraises Sputnik

—

Article

in

November

issue

of

"The

Exchange"—Exchange Magazine, Dept. TB-8, 11 Wail
Street, New York 5, N. Y.—$1.00 per year. Also in the same
are

articles

on

dividend

payers

and

cessions

Inc.—Memorandum—Watling,

Building, Detroit 26, Mich.

much
doubt
on

a

Housing
firm bottom,

of

consequence

1953-1954. The,

sonal

next

experience of resistance to higher
prices are significant. They point

year

two will

or
re¬

and" clear-cut

sensitiveness

of

consumer

buying to shorter hours and grow¬
ing layoffs."

difficulties.
The

the

to

veal persistent
and
stubborn

indebtedness

period
will,

Business

however, be

and

expenditures on plant
equipment are now topping

by

ad¬

out

and

on

*From a talk by Dr. Langum before the
Fall economic meeting of the Union Trust

Company,

Washington,

D.

C.,

Oct.

22,

1957.

Delhi-Taylor Oil

Special Reports

will




more

moderate,

how face.

Wyatt, Neal Adds
("Special to The Financial

ATLANTA,

G a.

Johnstone is now
& Waggoner,

—

Chronicle)

Richard

G.;

with Wyatt, Neal

First National Bank

Building.

With Hornblower & Weeks
(Special to The Financial Chronicle)

move

FOR

local

and

rise.

Defense

some

in the next six months

or

so

probably will not increase
during that period, just when the

on

Request

is already under

economy

pressure.

Later,

spending

expected

as a

an

increase in de¬

may

no

doubt be-

result of the Russian

satellite development.

This, how¬

will not cushion current

strain

on

Western Securities Corp.
Exchange Place,'Jersey City, N. J.

the economy.

Telephone HEnderson 2-1000

Open-end phone to N. Y. C. HA 2-OlSS

Corporate
be under

corporate
moved

SALE

spending may fall

Corporate Profits

One

Trinity Place, New York 6, N. Y.

we

government
spending will continue its steady

ever,

Security Dealers Association

which

but

now

difficulties,

the

than

rather

from 1957 to 1958.

State

private

Three States Natural Gas

Big Piney Oil & Gas

York

sion

significant

would

serious depres¬

-

fense

Members: hew

economy

likely be facing a

,

Over-the-Counter Securities

74

American

moderately
CHICAGO, 111.—Jay M. Wasser-'
John K. Langum
down.
Moderate excess capacity
justments, dis¬
man
has become affiliated with
has emerged in many industries,
appointments
Hornblower & Weeks, 134 South
and inability to forge ahead thai) corporate liquidity has suffered a
by sheer decline in economic serious diminution, and the rate La Salle Street. Mr. Wasserman;
activity as measured in dollar of return on added investment has was formerly with Arthur M.
declined sharply.
magnitudes.
Inventory ad¬ Krensky & Co., Inc.
J
Total
personal income moved justment will continue for several
down slightly in September, 1957, months ahead, at least. The sharp
from the preceding month.
Per contrast from 1956 in the role of
capita disposable income in con¬ business investment in the econ¬
stant prices has moved down over omy will be heightened as we go

more

and

TROSTER, SINGER & CO.

investment;
the'policy, the

been for

not

Investments and Inventories

ahead

Northwest Production

Specialists in

it

Had

so-called tight money

showing
August,

.

and no

major speculative bubble ir¬
of the >major

top

boom.

tinctly disappointing.
increase

a

d h a v e had

inflation

more

should be expected for some time
ahead. The record burden of per¬

of
and

diversification

companies.
Federal Mogul Bower Bearings
Lerchen & Co., Ford

restraint, we w o u 1

retail sales in September and Oc¬
tober to date have again been dis¬

no

policy of monetary

the

for

been

money

the last year. After a real
of strength in July and

but

re¬

characterized

Charles Bruning Co.—Memorandum—Milwaukee

He credits tight

starts have reached

than

slight

-

Big Bear Stores Co.—Memorandum—The Ohio

a

1948-1949

v

—

r.

by Dr. Langum indicates to him
are of a serious reces¬

The American economy is mov¬

ing into

given

Federal Reserve System for
the
substantial contribution to
economic stability
and growth •.
which it has made during the last
two or three years.
Had it not ;

difficulties ahead but they

Company, 61

»

Particular credit should be

of

Broadway, New York 6, N. Y.

word.

Policy

to the

policy for saving us from a depression, and expects more
adjustments, disappointments, and inability to forge ahead
than sheer decline in economic activity, as measured in dollar
\
magnitudes.

Bonds—Circular—Park, Ryan, Inc., 70 Pine Street,
5, N. Y.
'
—

rather than de-,

recession,

pression is still the proper

Chicago, 111.

sionary, and not depressed, nature.

yield

Planning Adjustments

are

off,

inter¬
developments exerting a
will be important

points to difficulties ahead

All this
—but

up-to-date com¬
that there

New York

the world-wide

downward force on our economy.

By Dr. JOHN K. LANGUM*

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

Tax Exempt

important,

national

on

Shawinigan Water & Power.

Economic Consultant,

parison between the listed industrial stocks used in the Dow-

issues

available

The Current Economic Outlook

Upham & Co., 120 Broadway,

5, N. Y.

Bank Stocks—Quarterly analysis of 13 issues
—Laird, Bissell & Meeds, l20* Broadway, New York 5, N. Y.

Broad

Finally, and not

Credits Tight Money

New York City

British

Pipe Line—Com¬

discussion of Stocks for Income with

a

Strength—Harris,

New York

.

1

situation in 1S58.

Exchange.'Building, Colorado Springs, Colo.

Mining

Beatrice

j

of

investment boom is tapering

Westinghouse Electric Corporation — Analysis — Laird, Bis¬
sell & Meeds, 120 Broadway, New York 5, N. Y.

Johnson, Lowry & Co., Inc.,

confidence

by the political

maintenance

and there

Also

Canada.

Canadian Pacific Railway and

Broadway, New-York 6, N. Y. Also in the same issue are
discussions of the Shipbuilding and Gasochemical Industries.
Low Priced Stocks;— Bulletin

National

Texas

parison—R. A. Daly & Company, Limited, 44 King Street,

61

&

Company,

.

disillusionment.

will not be aided

least

Houson 2, Texas.

West Coast Transmission and Trans Canada

'

Japan's Internationa} Accounts—Discussion in current issue of
"Nomura's Investors Beacon"—Nomura Securities Co., Ltd.,

Box

&

J

and inves¬

When perfection-plus

alike.

The
"

.

Ticker—Circular—Crerie

Texas

— Querent information — Yamaichi Securities
Company of New York, Inc., Ill Broadway, New York 7,

Japanese Stocks

a

profits will test con-

bring about great

Corporation—Report—Loewi &
Incorporated, 225-East Mason Street, Milwaukee 2, Wis.
Transmission

Eastern

J

is-expected, even minor troubles

Inc., 41 East 42nd Street, New York 17, N. Y.
;Texas

ited, 44 King Street, West, Toronto 1, Ont., Canada.

Tax

Harris, Upham & Co., 120

—

York 5, N. Y.

Broadway, New

Co., 55 Liberty Street, New .York 5, N. Y.

New York.

Bulletin

Standard Oil Co. of New Jersey—Bulletin—Ross, Lyon & Co.,

Economy and the Market—Bulletin—Alfred L. Vanden Broeck

Investment

—

re¬

.

fidence of businessmen
tors

Scott Paper Company

Figures:—Wood, Gundy & Co., Inc.,
Wall Street, New York 5, N. Y.

j

Pressure on

Kerr-McGee Oil Industries, Inc., First

of

to inventory

due

profits

valuation,

when there is

and

overstatement

initial

an

ported

Boston Corporation, and Time, Inc.

ing, Toronto, Canada.

&

11

when

true

particularly

is

That

costs are rising

Company—Analysis—Amott, Baker &

Foremost Dairies, Inc.,

Build¬

Canadian;Oil—Facts and
40

McKinnon,

&

exerts af

force on profits.

major downward

Doyle,

—

Co., Incorporated, 150 Broadway, New York 38, N. Y. Also
in the same bulletin are data on Bell & Howell Company,

Sons,

&

Portage Avenue, East, Winnipeg, and Royal Bank

Memorandum

—

Company—Report—Thomson
New York 5, N. Y.

Royal Dutch Petroleum

Leiier.

Bond "Market—Review—James

Canadian

Elevator

WalL Street,

View—Monthly investment letter—Burnham and
Company, 15 Broad Street, New York 5, N. Y. Also avail¬

Co.

Wire

&

has been that even

slight drop in volume

a

O'Connor & Co., 135 South La Salle Street, Chicago 3, 111.

;

Otis

.

Steel

1957.

of

past recessions

Big Piney Oil & Gas.
Northwestern

1955, in 1956, and

in

Street, New York 5, N. Y.

Northwest

Development Fund's
participation in missiles and rockets—contains text of U. S.¬
British joint statement on fusion and comments on Nuclear
Chicago and Harshaw Chemical Company—Atomic Develop¬
ment Seeuirtiea Co. Inc., 1033 Thirtieth Street, N. W., Wash¬

Atomic Letter (No. 32)-r-Discusses Atomic

at $21 billion
in the first
The experience in

profits have stayed

M. Kidder & Co.,

McKesson & Bobbins Inc.—Memorandum—A.

investment in

business

over, gross

*

Recommendations & Literature

in
More¬

and to $432 billion

half of this year.

the first

Co.—Analysis—B. W. Pizzini & Co., Incor-

moved.
bil¬

GNP has

as

billion in 1955, $414

from $392

lion in -19156,

Faroll & Co., 29 Broadthe same bulletin are data

New York 6, N. Y. Also in
May Department Stores.

' way,

L-O-F Glass Fibers

to

three- years,

.

_

Ginibel Brothers, Inc.—Data—Joseph

Dealer- Broker Investment

November 14,1957

Financial Chronicle... Thursday,

The Commercial and

(2108)

profits

severe

are

pressure.

profits

sideways

have

going to
In total,

virtually

during/the. last

Ten Diebold Rekordesk

Safes

Model 851.

Each safe is 72" in

width, 38"

in depth, and 42"

high.

Holds 15,000 "5x8 cards

and 15,000 3x5 cards.
and closes

Opens

electrically. 2 Hour

lire label. Grained -walnut fin¬
ish.

Please

contact €. Chris¬

Dime

Savings

tiansen,

The

Bank of

Brooklyn, 9 DeKalb

Avenue,

Brooklyn

TRiangle 5-3200.

1,

N.

Y.

;

Volume 186

Number 5690

...

The Commercial and Financial Chronicle

(2109)

With Paine, Webber Staff
DETROIT,
Boos is

now

-

v

FT.

LAUDERDALE,

Aaron

Webber, Jackson & Curtis, Penob¬
Building.

-

Barzilay

is

in

Fla.—

conducting

ST.

LOUIS,

J. F. Lynam 8c

L.

from

Co., Inc., Ill South

is

now

Co.,

view

with Francis I. du Pont &

with

'

is

ner

to

at

business.

engage

been

Robert

Schach-

principal of the firm.

in

a

is

formed

S.

Davies,

connected

with

Tlenry,

& Co., 308 North
Eighth
Street, members of the New York

and Midwest Stock

r

.

Theodore Bernstein

E.

Theodore Bernstein, limited
partner in Carl M. Loeb, Rhoades

and

Secretary-

&

Treasurer.

Co., passed

age of

away

84, following

Nov. 5, at the
a

long illness.

NEW ISSUES

:

:

$20,700,000

Cook

:■

'

./■

County, Illinois

d
3%%
na%
Various
Al5
Purpose Bonds of 1957
Dated December 1, 1957

,■•••"

•'

.

•

June 1 and December 1) payable

on

bonds in denomination of $1,000

.

Due December 1,

-

.

Principarand interest (December 1, 1958 and semi-annually thereafter

registerable

as

shown belovr

the office of the County Treasurer, Cook County, Illinois. Coupon

at

principal only.

as to

'

Interest exempt from all Present Federal Income Taxes

•;
These voted

1

bonds, in the opinion of counsel, will constitute direct general obligations of Cook County, Illinois,
payable both principal and interest from ad valorem taxes to be
y
levied upon all taxable property located therein within the limit provided by law.

$11,400,000
3Vi% Bonds

$5,600,000 County Home

$1,300,000 County Court House

Due 1958 to 1969 inclusive

Due 1958 to 1977, inclusive

$2,800,000 Criminal Court and Jail Buildings

$1,700,000 Arthur J. Audy Home for Children

Due 1958 to 1977,

inclusive

Due 1958 to 1977,
4

Amount

Due

■

$770,000

h

2.60%

770,000

1959

2.80

770,000 ;

1960

3.00

770,000

1961

V

*

Amount

Due

Price

$770,000

1965

3.40%

770,000

1966

3.45

290,000

1972

3.55

770,000

1967

100

290,000

1973

3.55

3.10;

1962

770,000

1963

^.30"

770,000

1964

3.35

:

3.20

'

Amount

-

Due

:

$290,000

Yield

;

.

•7

*

:

770,000

or

U

Yield

1958 *

inclusive

•

Yield

1971

3.55%

770,000

1968

100

290,000

1974

3.60

610,000

1969

100

290,000

1975

-3.60

290,000

1970

3.55

•X'
(Accrued Interest

to

290,000

1976

290,000

1977

3.60

:

3.60

be Added)

$9,300,000
3lA% Bonds \

.

V;y

:

*

/

-

$7,800,000 County Hospital

$1,500,000 Voting Machine

Due 1958 to 1970, inclusive

Due 1958 to 1977, inclusive

Due

Amount /"* " *

.L;l*

V,y.$715,000 -:,T
'

!

-

J/.

715,000

-

''yf

:

7 2.60%

1959*

2.80

-196 V

715,000

:i962? <

7

"

1963

'

;

.

$715,000

*

-:

••

■

,

V

7

Amount

-

.

$75,000

3.40%

-

7

,

,

Due

Yield

1971

3.55%

1972

3.55

1966

3.45
3.50

715,000

1968

3.50

75,000

1974

715,000

1969

3.50

75,000

1975

3.60

195,000

1970

3.55

75,000

1976

3.60

; 715,000

3.10
3.20

3.35

''

'

v

;r

y
-

'A

4

7

~

-

'
-•
f.*

"

Yield

..

1967'

3.00

3.30

1964"

715,000
;

1965 '

715,000

-

"

-.'

'

r

ft
'

Due

■

Amount

-

75,000

•

.

•

715,000

715,000

■

yy

1*1960 7 ;

-

il

Yield

j:

;i958:^

715,000

.

:

:

These bomb

-»

are

offered

on a

* -v■*->• •vv-a-'"*--*

f :

;

•

•:

75,000

.

as

and if issued and received by

1973

us

3.60

; •

3.60

-

'

at

v.-: ?

3.55

{

1977

75,000

'

d y

(Accrued Interest to be Added)

when,

; '

:

basis, subject to approval of legality by

•/:

■

■

-

•

...

.

.

<" '■

•

y

•

:

*

„

The First National Bank of Chicago

Continental Illinois National Bank

7°

C.J."Derine&7o"

*

•

Harris Trust and Savings Bank

The Northern Trust Company

Shields & Company

Paine, Webber, Jackson & Curtis

Kansas City, Mo.

Andrews & Wells, Inc.
r

"

.

Incorporated

A. E. Masten &

Company

Dempsey-Tegeler & Co.
John Small & Co., Inc.

Rodman & Renshaw
Dreyfus & Co.

C. S. Ashmun Company

Dittmar & Company, Inc.

Eddleman-Pollok Co.

-

Incorporated

*

_


November 12, 1957


R. W. Pressprich & Co.

Hirsch&Co. Shearson, Hammill & Co. Trust Company of Georgia AmericanNationalBankandTrustCompany
'
1
of Chicago
..
Robert W. Baird & Co. Julien Collins & Company
Fitzpatrick, Sullivan & Co.
E. F. Button & Company King, Quirk & Co.
,

Shelby Cullom Davis Co.

Chemical Cora Exchange Bank

City National Bank&TrustCo. Dominick&Dominick
-

Reynolds & Co. ; First National Bank
in Dallas

The First National City Bank

Portland, Oregon

City National Bank & Trust Company
.

Chapman and Cutler, Attorneys, of Chicago, Illinois.

White, Weld & Co.

The First National Bank
of

of Chicago

Messrs.

-

Farwell, Chapman & Co.

Federation Bank and Trust Co.

j

Exchanges.

;

V.

Robert

Vice-President;

*'

LOUIS, Mo.—Penelope Lee

now

Franc

securities
Hazel

are

President

Hathaway,

se¬

a

has

Officers

Hathaway,

Fair-

in

business. Samuel

a

Company

Building to

been

101

engage

(Special to The Financial Chronicle)

ST.

with offices in the Farmers Union

Trading

offices

Avenue

curities

Exchange.

Omaha Grain

■

Henry, Franc Adds

,

(Special to The Financial Chronicle)

way
'

has

'•

DENVER, Colo.—C. M. Hatha¬

Exchange Place, New

Corporation

Hathaway Co.

of¬

City.

formed

OMAHA, Neb.—John P. Dillman

Meramec Avenue.

40

Trading

(Special to The Financial Chronicle)

connected with

Form

" • >'

JERSEY CITY, N. J.—Investors

Now With F. I. du Pont

Mo. —John

now

at

business

Form Investors

Lynam Staff

(Special IoTke Financial Chronicle)

Tierney, Jr. is

securities

a

'

2830 Northeast 23rd Street.

'

Opens

Edward R. Newill is engaging

York

securities business from offices at

scot

E. R. Newill

fices

a

"T

t

•

Barzilay Opens

(Special to The Financial Chronicle)

Mich. —Warren F.
affiliated with Paine,

Joins J. F.

»

r

A.

(Speoiil to The Financial Chronicle)

9

-

Fulten Reid & Co., Inc.
Frantz, Hutchinson & Co.

The Commercial and

cials, engineers, State, county

Federal-Aid Highway Progress
For the Nation and Southeast
-

By C. D. CURTISS*.

[

"Commissioner of

[

U. S.

Public Roads

Department of Commerce

need for

U. S. Road Commissioner sees

"public relations"
access
will go

a

job in informing the public on properly controlled
roads.
Finds trunk lines of the Interstate System
through 37% of the nation's countries in areas that
more
than half the population. Foresees rise from

contain
present

65 million road vehicles to 100 million in twenty years; out¬
lines tremendous potential for the twelve states in the South¬

|

being made

east; and reports on five special studies which are
with State highway departments.

transportation
plays such a fundamental role in
our lives, it is such a basic factor
highway

Today

i

Financial Chronicle

Thursday, November 14, 1957

...

(2110)

10

in

economic

our

road-

vast

building pro¬

which

gram

have

we

un¬

dertaken can

properly
called

be

anew

the dramatic
growth that the scope and urgency of the In¬
terstate program have won public
acclaim. But you and I know that
this key network cannot realize its
full potential unless our other road
systems also are capable of han¬
dling tomorrow's greatly increased
traffic loads—much of it destined

for all

Nothing bet¬

C.

Federal-Aid

provided for the improvement of
two principal systems—the 235,000-mile Federal-aid primary sys¬

Curtiss

D.

Highway Act
1956.

who

inace

officials

highway

such

played

important

an

looking 20 years ahead, when
than 100 million cars, trucks,

more

buses

are

anticipated—com¬

pared with 65 million

in use today.
have set out

For the first time we

equate the motor vehicle with
way of life. Not only must we
build safe, efficient highways de¬
to

our

deficiencies

signed to correct past

is

that

obsolescence—and

and

huge task—we also must

a

take into

all-pervasive role of
vehicles in promoting eco¬
the

account
motor

growth and in fostering a
of community benefits

nomic

long

list

that

are

dependent

sound

upon

highway planning.

communities

throughout the country motor ve¬
hicles provide the only effective
means of transportation.
An

been

Interstate System
includes only

1.2%

total road and street

mile¬

System

our

but it is estimated that when
completed it will carry 20% of all
traffic.
This future traffic will

age,

at

move

speeds. As
completed free¬

expressway

Atlanta's partially
now

ways are

demonstrating, this

traffic will flow into

large

cities

over

and around

safe, divided

highways of 4 to 8 lanes, protected
by carefully planned access.
Equally
important, these great

thousands of
both directly
interconnecting

trunk lines will serve

smaller communities,
and

through

Experience

routes.

shown

corridors

already

has

these .nodern traffic

that

invite

business,

com¬

mercial and industrial growth on

large scale.

land

into

apportioned

for

They transform raw

thriving

communities.

fiscal

the

1959. These increases, coupled
with the fact the apportionment'

year

Interstate

of

on

money

will

would

that

funds

ABC

be used

release

otherwise

the Interstate System,

im¬

provide for very substantial

provement to the regular systems,
in addition to the mammoth In¬
terstate program.
Because

the

and
to

old

story

to

•

g 0 0

highway officials and

ieel that access control

individuals

on

is an arbi-

their freedom

In some cases, ,too,

want

may

to keep

a

frontage directly on the

business

Standards having been adopted,
the next step

the determina¬

was

tion of specific locations for every
As you know,

route.

this involved
engineering and
economic study.. Specific, detailed
locations have been selected by
tremendous

a

the

States

and ^approved

Bureau for

the

by

the

than 80%; of the

more

total mileage.

For the remainder,
reasonable

feasible and

most

of several

desirable alternates ape

being used for the estimate.
"^
At this point I wish to note that
the States have cooperated

whole¬

heartedly in the preparation of the
necessary traffic forecasts and cost
estimates

studied

field

—

Public

and

teams

Roads

of

State

havjb

engineers

mile of the system
on
the ground.
"
,v /*§,
The s t u d y to determine the
every

.

m a x

i m.u m

.

desirable sizes

and

weights df vehicles, described in
Section

of

108

AASHO

the

(k) hinges in part on
Road Test.
In spite
delays, a

unavoidable

s o m e

great deal of work has been done
this project.

on

overpasses

apportionments. Nationwide the figure is 29% of the
1953 apportionment. I would like
£0 see £bjs region catch up to the
national
average
and I believe

State in the south— Mississippi,
with

Grading; drainage,

substructures for bridges and

and

these

systems

each

of

a

enhances

other.

Trunk lines of
eled

Interstate

through
in

street

so

to

the end prod-

planned

which

assuie.

It

can

access

hold

Add

WOrk

interstate
on

funds

and

are

at

the 1958 monies.

have been substantially

all

completed,- and
bids

2

bridges

under construction.

now

are

On

Aug.
opened for the test

were

pavement.
The paving contract,
amounting Jo more than $5 mil¬
lion, has been awarded and con¬
struction will proceed on the turn
arounds and access and frontage
expect that the pave¬

roads.

We

14 and

with 35 States represented

of the 1956 Act on
road June 2g, 1956, contracts have been
turn, awarded for 319 miles of Inter-

per-

anently

reserves

right-of-way
and this in
protects the highway investment. state highway
It cuts traff.c accidents by two-, £bis area,

improvements

in

will

System

Moreover,

more

than

pass

counties
these

half

of

of all farm products
further fact that

the

of all pas¬

It

Total costs
estimated at
more than $22 million.
In order to round out the in¬
formation needed to make recom¬
mendations covering vehicle di¬
mensions and weights, the Bureau
million for the project.

the

of

test

now

are

,

traffic

string

With

punctuated

hazards

of

through traffic nor
met.
Plannino"
Planning

In all of

Tndav
Today
our

by

a

the

program

Neither 1956 Act afford a means of enlocal needs are lightening the public both on the
program as a whole, the impor-

for
for

Tomorrow
Tomorrow

deliberations let us

that

remember

the

mention

a

few

tance '.of the

standards, and to

explain the particular project involved at the hearings. Such hear-

highways

outstanding

ex-

Progress

they appear in the Act> x want
report first on the status of Section 108 (d) which calls for esti-

as

tQ

on

the

the

of

AASHO

manual for, the

have prepared a
guidance of State

in collecting
information
needed and we expect to submit
public hearings required by the a report to Congress by the Janu¬

lights.

red

amples.

Require Cooperation

an

-

>

redevelopment.

of

^

.

and

share

offers^ the maximum in \
"
* ,
economical, efficient motor vehi1.
O11 Schedule Nationwide
cle
operation.
It adds tremenNationwide we are on schedule,
dously to the Nation's defense and As of Sept lf 1957, contracts have is
working on an extensive study
survival potential in time of war. been advertised and funds obliof the economics involved in the
It opens the way for long-range gated totaling $2.6 billion as Fedroad-vehicle relation.
>
State
and
community
planning eraj ajd on the primary, secondary
The third study, under Section
which will tie together not only and Interstate'Systems.
On tne
114,
deals with possible reim¬
highway transportation and eco- interstate System alone, construc- bursement for existing highways
nomic growth but the many com-; tion
contracts aggregating
over which are included in the Inter¬
munity
betterments
that are $340 miHi0n in Federal funds have state
System.' Since this involves
needed.
)
been awarded for 1,947 miles of
cost figures and other information
For
motorists
planned
access new highways — including con- which is being obtained through
means that every car, bus, or truck
tracts for 1,681 bridges. By Sept. the needs study required by Sec¬
entering or leaving these trunk l of this year, $6 States had corn- tion 108 (d), action was deferred
lines will move along special fa- mitted all of their 1957 funds and until this material became avail¬
cilities designed to channel vehi- were moving ahead on the 1958 able.
cles in and out of the through monies.
The Bureau and representatives
thirds.

of ings should be carefully planned
tomorrow depend on the planning and
held bef0re final decisions
senger car trips are under 10 miles
that
is
done
today—not
ten
years.
haVe been reached as to location
and it becomes clear that many
from now.
Where future traffic and design. Alternate routes that
customary local travel routes will
studied
should be
undergo
considerable reorienta¬ capacity, safety and efficiency are bave • - been
tion in counties served by the In¬ at stake there is no room for com-, reviewed, pro and con, and the
advantages of the favored route
terstate System, and this means promise.
that local parallel and intersect¬
explained in detail. Such public
Southeast Potential
hearings will promote public suping routes leading to interchanges
In
the
Southeast,
where
tremenwith the great trunk lines will re¬
port if properly organized, and
dous
new
industrial
and
com-, this support is surely going to be
quire very careful planning —
mercial forces are at work,, the needed in the years ahead,
planning which will provide both
short
haul
service to
motorists challenge to highway officials and
Five Studies
making trips under 10 miles and engineers, to business and comThe - Last year I mentioned five speoff-the highway service to through munity leaders, is obvious.
motorists in need of food, fuel or opportunity is equally great and cial studies which the 1956 Act
this region already can point to directed the Bureau to carry out
overnight accommodations. Not to
mention
the
highwav needs of many fine highway projects which in cooperation with the State highEach study is
commerce, industry and agricul¬ fully justify these expectations for way departments.
the years ahead. Without attempt- a major undertaking in itself,
ture, or the expanding role of
Again taking the studies in order
highway facilities in urban growth ing a complete run-down let me

nationwide about 80%

their

to support
additional S3V2

unanimously

voted

well started
this orderly we need continuing public support
living
and
serves
the flow, random access soon turns particularly for the standards,
even a 4-lane thoroughfare into a
pubiic relations are more imporThe
the heavily trav¬ congested, slow-moving welter of tant now than ever before.

population and they market

nearly 50%

4957

Since passage

Like traffic streams.
By contrast with
organism,

of all the

37%

Nation.

the

counties

sold.

are

switches

traffic
forth, from

Here are some of

ucts

Greater New
•An address by Mr. Curtiss at the 16th
Obviously these are problems Orleans Expressway with its many mating the cost of completing the
annual
convention of the
Southeastern
which can only be solved through complex traffic and engineering Interstate System.
These figures
Association of Sta'e
*nway
Officials,
the cooperation of highway offi¬ problems is a tribute to all who must be submitted to Congress by
for
FRASER
Atlanta,
Ga., Oct. 2, 1957.

Digitized


Sys¬

covering the fiscal years 1960,
1961 and 1962.
V;; ,v.

the,. 1957

0£

appor¬

Interstate

tem

d , Progress in carrying; out
j r interstate programs. "By

highway.
t,
you will. One
Thus no-small part of your task eastern region

highway, endlessly.

parts

our

Measured in distance the Inter¬
state

a

for

back

Much of our east¬

countless

in

30; $850 million is available
1958, and $875 million has just

June

seaboard falls in this category,

and

of

ABC funds in the amount

million were provided for
year which ended last

fiscal

road

growth of huge metropolitan
areas
tied together by highway

the

War II.

steady

and

for

following World1

years

of $825

the

urbanization

Consider, if you will, the

transportation.

nine

first

annually

available

made

interdependent,

trend toward regional

ern

Control;

an

future

for

the

will take on. a public relations 47% 0£ j£S 4953 funds obligated—
ment will be completed by July
the Interstate
flavor.
We know the benefits of was ahead of the national average
1958 and the actual road tests will
network, and the Federal-aid sec¬
planned access on heavily traveled on Sept. 1? 4957. Three other States
ondary system, consisting of 520,get under way ill the fall. Inci¬
routes. And we must be prepared —Arkansas, Kentucky,
and Vir000 miles. This 755,000-mile total
dentally, the Administration Com¬
to demonstrate them to all.
ginia—have obligated all of their
is eligible for improvement with
mittee of the AASHO met on Aug.

only today's needs but also reckon
with future traffic demands.
We
are

be

may

basis

tionments for

The 12 States in the southeast, e
■
n^
ojg
- ewhole
rm
have made

V

Selling Access
This

the

form

tem, which includes

part in shaping the new program,
are fully aware of its implications.
At long last we have come to grips
with our highway problem.
For Federal-aid funds.
The 1956 Act provides for about
the first time in our history we
have set out to provide a complete a 60% increase in Federal funds
inationwide system of expressways for these two systems over and
built to standards which meet not above the average of $500 million

and

January 1958, and presumably will

The Virginia portion ' of the
in safer, more efficient highway Washington
Circumferential Extransport. Inevitably groups like pressway is noteworthy, and so is
your own association stand at the Florida's Sunshine Expressway,
very center of this complex and
Progress on Atlanta's famous
all-important undertaking.
expressway is an object lesson in
As you know, the 1956 Act fully sustained
cooperative effort and
preserves the long-established fine engineering,
policy of cooperation between the;:?i We can glimpse the real potenStates and the Bureau of:Public tial. of the new .program in the
Roads which was begun inV1916 Southeast, by looking at the Fedand was further strengthened by eral-aid funds-available for the
successive
enactments,
particu- fiscal years 1957, 1958, and-1959.
larly in 1921, 1944, and 1954. I am The- 12-State total comes to $1,not
going to elaborate on the 414,670,546:'; This includes $1,024,soundness of this working partner- 125,606 for the Interstate System,
ship—the 41-year record speaks All of this money has been apporfor itself.
;
'
v tioned by the Secretary of CornThere is one feature of the 1956 merce and is now available for
Act which deserves special men- highway improvements on the prition for it is directly concerned -mary, ; secondary; and
Interstate
with a basic purpose of the new Systems.
By comparison with
program — to provide safe, free- earlier
periods in our highway
flowing traffic. The whole concept history, let me remind you that a
of
the
Interstate
System ■; rests total of only $1,846,559,276 in Fedupon
modern
design standards' eral-aid highway funds were apwhich will provide ample traffic portioned to this region in the 40
capacity, protected and preserved years which -preceded the. 1956
by planned, controlled access.
\ Act,.
,v \. ' V'-

of movement.

regular, or ABC funds, are

The

pioneering
spirit than the

of

a hand in conceiving and
carrying out this undertaking,

and had

many

organizations .which have a stake

Federal trary restriction

aid.

our

purpose,

Act—witness the record

authorizations for regular

of

unity

1956

the

symbolizes

our

at one

Interstate System

the

the

and

bodies

traffic en-;d b e
time or another.
gineers but there is no doubt that Sept 1, 4957, these 12 States had
Congress was well aware of this
many
motorists are inclined to obligated all prior funds and 93%
mutual dependence when it wrote

Americans.

ter

rightly*

Quite

for

design for livin g

country

and

town

bring

They

closer together.

municipal

highway departments
and
reporting
the

1958 deadline.

ary

The

fourth

mine what

deter¬

Government in

A- study

field.

involving

seeks to

action might be taken

Federal

the

by
this

study,

safety,

highway

director was

appointed in December 1956 and
liaison was promptly established
with the Special House of Repre¬
sentatives Subcommittee on Traf¬
fic Safety to

aid in developing the
of study.
One of

Bureau's

plan

the more

promising activities just

beginning is a case study of acci¬
team of engineers,
medical and social scientists. Else¬

dent causes by a

about a dozen States,
Virginia and North
Carolina, highway officials, police
and
motor vehicle officials are
cooperating in. special researches
directed toward the speed factor.
Exhaustive studies of large eco¬
nomic losses occasioned by traffic
accidents are going forward i
several other States. This report
and recommendations covering th

where,

in

including

optimum Federal role in highway
safety is due at the Congress o
or

before
Those

the

March 1, 1959.
who-have

Bureau

worked wit
data re

in gathering

Volume 186

Number~5690

...

The Commercial and Financial Chronicle

(2111)
quired from the Section 210 study

progress

know that this

is

with

complex

and

difficult

have

undertaken.

as

ever

of the

cost

jobs,

we

This study,

know, requires

you

sis

of the most

one

analy¬
providing high-

of

an

■of vehicles and of the benefits de¬

from

highway use by all
classes, of users and, in addition,
estimate

of the benefits of high¬
to other than highway users.
purpose
of the study is to

ways

The

furnish

the

mation

that

for

Congress
will

provide

determination

a

with
of

rates of Federal taxation

way

til}

ji0

"'

users and
,

infor¬
a

basis

equitable
on

tax

other beneficiaries.
year we are

collecting the information—about

Other

The

traffic
•

of

motor

volume

vehicles,

and

weight

position, and about both
non-user

benefits.

about
com-

user

and

So far the best

11

U ft"

devoted

dinner

analysis of the data and writing .p.m.

meeting
the

at

Club.

the hands of Congress by March 1,
1959. From the facts given in that

Macaulay,
&

report we hope that Congress will
able

solution
tax

fashion

to

the

of

Federal

problem.

.

-

;

have

we

the

moved

anxious

full

added

will

be

that

assurance
on

Machinery
be

Francis

Marine
span

Midland

be

Weeks,
Trust

..

.

made

of

Jr.

Company.

Tariff is $4.75.

(Special to The Financial Chronicle)

BEVERLY HILLS, Calif.—Don¬
ald D. Dore and Richard A.

will be the speaker at the lunch¬

Fay

eon
meeting of The Investment
Analysts Society of Chicago to be
held' Nov. 14 in the Adams Room

of the Midland Hotel.

have
become
associated with
Francis I. du Pont & Co.,
City Na¬

tional

v

&

OAKLAND,
Fontaine &
to engage
Lester M.

Calif.

Co.

in

a

—

G

r a n

t,

'

.

New A. C.

George Sewell Haydock, Cin¬
cinnati, passed away Nov. 5, at the

opened

a

rection

of

Richard

D.

job

schedule—and

& Co. has opened

firm

at 510 Burbank Avenue under the

of

Haydock,

Peabody

Copley Co.

direction of

a

COLORADO SPRINGS, Colo.—
Benjamin F. Kelly has been added
to the staff of Copley &
Company,
Independence Building.

branch office

Virgil R. Smith.

School Construction and Various Municipal Purposes
3.60%

(Serial) Bonds

Dated November 15, 1957

Due November 15, 1958-72, incl.

Principal and semi-annual-interest (May 15 and November 15). payable in New York City at the office of the City
Comptroller. Coupon bonds ih denomination of #1,000, convertible* in to fully registered.bonds'
*
•
in denomination''of #1,000 or multiples thereof, but
notdnterchangeable.

-

Legal Investment for Savings Banks and Lift Insurance Companies in the State of New York
and for Executors, Administrators, Guardians and others
v

holding Trust Funds

for Investment under the Laws of the State of New York

7

ivfunicipal Purposes Bonds, in the opinion of counsel, will constitute
legally binding general obligations of the City of New York, all the taxable real property within
will be subject to the levy of ad valorem taxes to pay the Bonds and interest thereon, without

These School Construction and Various

iur

Cv

.

valid and
which

limitation

as

to rate or amount.

c

AMOUNT DUE EACH YEAR AND

1962 3.25%

YIELDS

$2,100,000

1965

3.40%

1959 2.80

2,100,000

1963 3.30

2,100,000

1966-67 3.45

3,400,000

1960 3.00

2,100,000

1964 3.35

1,800,000

1968-69

3,400,000

1961

1,800,000

1970-72 3.55

3,400,000

T

!3,400,000

1958 2.60%

$3,400,000

D

3.15

3.50

(Accrued interest to be added)

V
h'
r,

;

.

The above Bonds are offered when, as and if issued and received by us, and subject to prior sale and approval
of legality by Messrs. IVood, King & Dawson, Attorneys, New York, N. Y. It is expected that Interim Bonds
in denomination of $1,000 will be delivered in the first instance pending preparation'of Definitive Bonds.

The Chase Manhattan Bank

Chemical Corn Exchange

Bank Manufacturers Trust; Company J. P. Morgan & Co. Blyth & Co., Inc. Barr Brothers & Co. R. W. Pressprich Sc Co.
Incorporated

Merrill

Lynch, Pierce, Fenner & Beane

Ifornblower & Weeks

The Northern Trust Company

Carl M. Loeb, Rhoades & Co.

Ernst & Company

Baxter & Conmanv
F
3

Harris Trust and Savings Bank

Ilallgarten & Co.

Federation Bank and Trust Company

.

City, Mo.

Gregory & Sons

ill Dallas

City National Bank & Trust Co.
Kansas

B. J. Van Ingen & Co. Inc.

First National Bank

"

Wm. E. Pollock & Co., Inc.

The Philadelphia National Bank

Swiss American Corporation

-

E. F. Hutton & Company

The Robinson-Humphrey Company, Inc.

,
_

Sterling National Bank & Trust Company
l-

Stern Brothers & Co.

«

of New York

Trust Company of Georgia
'

*
,


York, November

New

14, 1957.

Seiler.

(Special to The Financial Chronicle)

$36,500,000

o

Coburn &

•

&

Hawley.

With

Allyn Branch

t.j

,

—

Incorporated
has
branch office at 4 West

Independence Street under the di¬

with

of 81. In the past Mr. Haydock
was
a
partner in the investment

W

v

•

Mid die brook,

WOODSTOCK, 111.—A. C. Allyn

age

N

Y

Fay

George Sewell Haydock

done well.

EE

?

-

<

SHAMOKIN, Pa.'

with

Stephenson, Leydecker & Co., is
a
principal, as is Bernard S. Fon¬
previously

Mr.

Coburn Middlebook Branch

securities business.

formerly

Building.

Company.
.

has been formed

Grant,

Bank

formerly conducted his own in¬
vestment business in Beverly Hills.
Mr. Dore was with E. F. Hutton

Grant, Fontaine Formed

taine, who was
Reynolds & Co.

into

greatest

the

Fay With Francis I. du Pont

Arthur

Loans,"

should
D.

to Hear

CHICAGO, 111.—R. A. Lambeth,
Of North American Aviation, Inc.,

Jr., partner in Blades
Macaulay, who will address the

with

construction job ever
by any nation. I feel

done

Nov. 21 at 5:30

will-

period of

a

the

of

on

Railroad

Speaker

Reservations

»

*■'<

••

anticipation

swing

undertaken
an

from

9

Chicago Analysts

group on "Corporate Insurance as

highway
1

During the past three-year

rather

meeting

equitable .Protection, for. Bank

an

i"

The Bank Credit Associates of
New York will hold their
regular

the final report, which must be in

be

If

I 0 HOIQ Dinner

phases of the study

1958 will be

year

highway needs, about the different peacetime
classes

T

going forward.

are

to

Bank Credit Associates

corresponding road-user

payments.': This work is well

in hand.

high¬

'

'

During the current

has been made in dealing
classification of vehicles

and their

!.Way facilities for different classes

rived

the

11

1

i

12

The Commercial and Financial Chronicle

(2112)

high level today—and hence for about one-half of installment
requires financing for - its short credit, wide consumer interest in
and long run needs. Of course, 1958 cars could mean a substan¬
with high rates, they may try to tial increase in demand for funds
cut
some
corners,
reduce some from this segment of the market.
inventory — but there seems no
Supply of Funds
clearly defined movement in this

Federal

at a

Forecasting Interest Rates
And Buq<«ess Conditions
By DR. JOSEPH It

Associate Dean, Graduate School o! j>iL»tness

direction. As for the longer run
needs of plant and investment, ex¬

Administration*

New York University

penditures remain high; only re¬
cently have estimates of some
reduction in the rate of expendi¬

could well
be overdone, Dr. Taggart avers in predicting no material
change is in the offing for interest rates unless the Fed acts
feeling about the economy's health

The over-bearish

-

normal spread between short

of the most

This is perhaps one

difficult times to forecast interest
As one examines the statis¬

rates.

tics

the

of

market,
fronted with
conflicting

is

one

in

site directions.

Moreover, any
forecast of in¬

rates

involves

a

forecast of
business con¬

All

ditions.

is

modi¬

fied of

course

this

Dr.

by any extern a 1
develop¬
ments

sucxa

States

is

today.

The

H.

Taggart

United

the

those

facing in the Near

East

Near

as

J.

treated

East

threat of war in the
is not one which can
lightly.

For

the

first

j,,.

it

clear that the total expendi¬

tures

for

the

will

year

top

last

market.

in

crease

funds

life

to

large

rates may postpone some
of the demands, but the pressure

money

i

suppose

gone

tutions.
some

than

important.

If

leveling off. Further, estimates
of future expenditures are lower.
is

borrowings

Company

Finance

of
are

looks at commercial and

one

industrial loans of weekly report¬

bring

short-term
need

to

to

to

that

decided

a

convince

The

,

some

Chairman, Martin
that

the Federal

will

desir¬

taking

has

reversal

the

a

admitted

in

1953

was

Summary
In

be

the

summarjv

backlog

of

demand for long-term funds con¬
tinues high and we may -look for

large
municipal
and ^ corporate
issues to be placed on the market

during the final quarter of 1957.
This demand will have

ing influence
est

on

a

sustain¬

long-term inter¬

rates.

The leveling off of business

ac¬

tivity may result in some inven¬
tory reductions and smaller de¬
mand on the part of business for
short-term
mand

for

funds.

bank

Lessened

funds

may

de¬

also

result from corporations' recourse
to

capital markets

restoring

their

as

a

of

means

liquidity.

in

trend

present

The

Industrial

and

Commercial loans by banks seems
to

the

reflect

ever,
not

indebtedness

Reserve

Federal

is

probably too early and too drastic.

However, the

the

reduce

in

ease

market.

are nec¬

the

change
Federal
is

chance, of course, in maintaining
this
policy of inducing unem¬
ployment
and
recession.
But,

shifts from demand to time

could

yet in evidence

are

essary

able.

opinion, is that we are

sparked the big rise in 1956 and
has been a sustaining force in 57,

ear¬

turn gradually from neg¬
positive or at least show
definite
signs of such a trend.
Moreover, it desires to see a flat¬
tening out of consumer prices
before changing its policy.
More
signs of weakness in the economy

deposits.
of
population on the need > for
Major Factor on the Supply Side
utility
services
reduces
the
flexi¬
at the moment over-bearish. Now
Of the Money Market—The
bility of utilities in adjusting their
there are signs of weaknesses in
Commercial Banks
financing to changes in the money
business. They are real signs that
market. Moreover, after expendi¬
As we have just pointed out,
must
not
be
discounted.
Basic
tures
have
been
planned
by there seems to be some decline
commodity prices have fallen to
corporations
and commitments in bank loans, but it must be re¬
the
lowest
point since
1953.
have been made, cancellation is
membered
that the net reserve
Wholesale commodity prices seem
not always easy even in the face
position of the banks is still sub¬
flattening out to a degree. One of
of sharp increases in rates.
the sustaining forces of 1957 for¬
stantially on the negative side
Corporations are placing large and
eign exports are tapering off and
currently show little signs of
amounts of bonds and stocks on
we can look forward to some sub¬
moving toward positive. In other
the market. To some extent, the
stantial
decrease
in
this
area
words, their net borrowed posi¬
because of changes in the world proceeds are being used to pay tion remains high.
Further, banks
off bank loans. This is probably
have suffered a decline in
situation, currency difficulties and
liq¬
controls
necessitated
by
other having some effect in reducing uidity as they have sold Gov¬
countries.
Business expenditures the volume of bank loans at the ernments to support loan expan¬
on
plant and equipment which present time. Seasonal liquidation sion. If the trend continues this
own

have relaxed them

ative to

this increase

may

restraint,

ently wants to see the net excess

insurance

Moreover, there

more

a

credit

As it is, the Federal appar¬

funds
which
would
to other savings insti¬

represents
have

of

some

following
of

reserves

Personal Savings are at record
heights. This is only to be ex¬
pected since they move in rather
constant
relationship
with
dis¬
posable income which in spite of
small drop in September is near
a
record high.
The rate of in¬

to

portion of the demand
for corporate funds in the present
market comes from utilities. High
A

Today in

Where Do We Stand

now,

seems

been

policy

would

lier.

by some margin. It should companies and savings institu¬
be
pointed out that companies tions appear to be below a year
lost
some
liquidity and
profit ago.
Time deposits of commer¬
margins may have declined. Such cial banks have increased rapidly.
expenditures then must be fi¬ Since these institutions are pay¬
nanced by recourse to the money ing higher rates, it is reasonable

there will be no war.

My

almost oppo¬

terest

they are
sume

j*

year

greater next year than
this year. We must as¬

be

Business?

statistics
which point

well

con¬

and

statistics

be

tures been forecast—even

and long rates.
The N. Y. U. Dean expects, in view of the high cost of missiles,
that taxes will not be reduced in next fiscal year, and that
Federal, state and local expenditures, plus consumer credit and
spending, may well offset declines in corporate spending.
to restore more

active

1

TAGGART*

Thursday, November 14, 1957

...

the

in

current

have

have

a

these

banks

conditions.
as

a

liquid position

decline

in

How¬

whole

are

and

the

loans will

not

significant effect on shortHowever, our psychology is bad ing member banks in 94 cities, a limiting influence on this trend.
term interest rates unless the rate
we
and
affected
no
doubt by the one could easily get the idea that
Consequently, the basic force on of decline in demand for loans
against a
downward move raent in the there has already been a decline
the supply side of the market is is much faster than is
great antagonist. If that power
anticipated.
the
short-term
demand
lor
equity market. As you know, this in
the Federal Reserve.
When one
takes certain definite steps vis-a¬
Long before any heavy decrease
In the pedoes have influence on economic funds from business.
discusses
the
future
of
interest in the demand for bank funds is
vis our ally and a
member of
thinking. I notice as the market 'riod from July-3 of this year to
rates, then one really guesses as in evidence, it is expected the
NATO, Turkey, anything that is
tends downward, more frequently Oct. 9, there has been a decrease
to the timing of Federal Reserve
discussed here must be then sub¬
Federal Reserve System will
I turn my steps toward the Auto¬ of $197 million. This compares to
ject to modification depending on
policy.
change its policy.
mat, and more and'"more, I see an increase of $975 million in
developments of events in that
The key to lower interest rates
Federal Reserve Policy
there people I know.
the corresponding period of 1956.
part of the world.
is Federal Reserve policy. When
This, I#think, is evidence of the
The policy of credit restriction
Since we have referred by in¬
Elements of Strength
the Federal may change is any¬
operation of tight money policy
designed to combat inflation will
ference to the Soviet Union, it is
We should not, of course, allow to a degree.
To some extent, of
It is under heavy
probably be relaxed if one can one's guess.
impossible to overlook this man- these factors of weakness and the
course,
it is related to the use
made moon. It is an eerie feeling
judge from recent official state¬ pressure from many quarters to
psychological factors to cause us of funds obtained through capital
ments.
It
should
be
to realize that every once in a
emphasized
to overlook the elements of real markets
change immediately. It may do
to liquidate
short-term that the
while
a
satellite made by
un¬
tight money policy has
strength in our economy which bank indebtedness. To some ex¬
so or it may elect to continue to
never been one of active restraint
friendly men moves over us. It prevails today and which will
tent
it
is
due
to
the
seasonal
involving measures to decrease take the risks involved in main¬
gives me a certain foreboding. It have a bearing on business of
movement in installment credit as
bank reserves. Rather they were
may be trite to say that man's tomorrow. Some of these
taining its policy in the face of
strengths Finance Companies have repaid
accomplishments in the human I find in the record heights of
followers
and
not
initiators of definite weaknesses in the econ¬
bank loans.
In
any
event,
the
and social fields have not kept
personal income, although there
change has not reached a magni¬ higher rates. Their discount rates omy.
pace with his advancement in the
vvas a slight decrease in Sept.; but
tude to be significant,
although have roughly kept pace with the
technical fields. This is a fact and
My guess is that the policy may
continued high employment; the
because
it is, it is
a
potential fact that there is little evidence it may well be a straw in the market and the Federal Reserve well be changed in the present
wind.
explosive force in our so-called of
has
any falling off of business ac¬
simply
not
taken
actions quarter. If so, short-term inter¬
civilization. It is the real source
tivity; retail trade remains high;
State and Local Borrowings
which would have added to bank est rates will fall; the banks will
of my eerie and foreboding feeling.
and consumer price levels show
State and local borrowings have reserves.
The tightening in the
From an economist's point of resistance
again become buyers of short and
to
pressures
of tight

time, in my judgment, it is more
than

serious
are

Korea

a

because

committed to fight

,

*

i

view, the importance of Sputnik,
however, rests on its effect on
government spending. As you all
know,
defense spending is the
largest part of the Federal budget.
Even the day before we learned
about the new satellite, the ad¬

money.
All in all, people are
earning large amounts—they are
spending large amounts and sav¬
ings seem to be running along on
just about the same percentage of
disposable
income, although in
absolute terms they seem to be
ministration
advanced
the
idea
rising.
With
these
very
very
that the defense budget could not hasty words on the subject, admit¬
be reduced in the new year. Since
tedly I am not able to give this
Sputnik, there are signs that we enough attention in a paper of
are being softened up for the bad
this length, it appears to me that
news
that defense is more im¬ business is
fundamentally strong
portant, we are told, than reduc¬ and I would look for no reduction

been

tant elements
of

the

to

continue

and

on

be

impor¬

At the end of this Sep¬

by voters.

money

the demand side

market. In the 15
months'
period from July 1956
through September 1957, about $5
billion in bonds were authorized
money

market then is the result

of the interplay

Federal

My

in

Few
cost

taxes.

the

Basically,

missile

I think it

program.

is this fan¬

tastic cost which delayed

for the
I

can

present year

see

in the

no

or

so

far

as

substantial reduction

first six months of

1958.

our

ac¬
Let
us
finally come to our
I feel specific topic for the day—The
sure
now
that
the
public are Future of Interest Rates. First, let
aroused sufficiently so that they
us, and of. course it is axiomatic,
will accept larger expenditures to
say
that interest is simply the
help close the margin between orice of money which is a function
Soviet scientific accomplishments of the demand tor it and supply
and ours. Therefore, one of the of .it. If we wish to look ahead

complishment in the

bearish

area.

elements which

has

been

in our thinking must be
changed. I predict that taxes will

present
not be

reduced

in the next fiscal

unless political and economic
exigencies make such reduction
necessary.
Moreover,
I
believe
that
Federal
expenditures may

then

as

to the

should

oertinent
and

price of

examine
factors

money, we

of

some
on

the

means

an

municipal

own

rest

of

unusually large flow of
offerings during the

'57

and

into

%

♦An

r"

■*

*

address

*

by Dr. Taggart before the
Forum, New York City, Oct,


18, 1957.

Mun'>'*»al

'

pected
gage

in

change

be ex¬
for mort¬

can

the demand

credit. The total of mortgage

credit
of

much

substantially above that
last year, but the rate of in¬

crease

has been at

pace.

Demands

a

the

loans.

for

fact

that

business

will

we

regard is more nearly normaL

is

in 1958 will

probably be sustained

at about present levels.

for

consumer

credit

question that Egypt will rely to

the

contrary

foreign

is highly encouraged
privileges by law.
is

"Egypt
who show

an

ready

to

capital

cooperate with

from

granted

and

all those

understanding of her problems -and

f

willing, without any reservations or. con¬
ditions, to. contribute sincerely to her efforts to

who

are

attain her
man

Credit

no

On

finance.

many

money,

They Contiibute?

great extent on her capital in financing its eco¬
nomic development, but this does not imply at all
that we have
closed the door against foreign

new

thereafter, while substantial, have
been
appreciably
below
1956.
Housing starts are below last year
and 1955, but total mortgage de¬
mand during the rest of 1957 and

continues

this

rates

everywhere

is to total $42.9 billion. Since Auto¬
continues mobile paper normally accounts

Underlying

interest

again assume a relationship which

much slower

high.
By the end of
Business
demands
for
funds August, this increase was about
continue at a high level, although $3 billion in the 12 months period,
there has been some decrease in bringing the amount outstanding
bank

longer-term

a

is

Demand
Demand for Funds

the

from

feeling is that had the

"There

Mortgage Credit
Not

Consumer

supply side.

and

Must

'58.

demand

year

mmmmmmmmm

the

short-

tember, almost $_3y2 billion were
still unsold.
This heavy backlog

in the real Gross National Product

people realize the fantastic

of

the

between

intermediate

Reserve.

—

tion

and

relationship

interference

without

securities

of market forces

and

objectives."—Mohamed Roushdy, Chair¬

Managing Director of Bank Misr of

an

income

attainment
A

learn

invest them in order to

from them, not to

elementary fact, this, but one
both h«ue
abroad seem never

very

many

or

Egypt.

obtain
"contribute" to the
of borrowers' "objectives."

Owners of funds

to remember!

all too
able to
_

.

j

Volume 186

Number 5690

The Commercial and Financial

...

Chronicle
(2113)
pursued by the Government.

Will the British Government
'

■

Encouraged by
in

checking
for

room

,

both wages

•

■

swer

signs of British governmental firmness

some

and prices continues." The author finds

change in price.

a wage

Wonders whether

a

raw

LONDON,
effective

by

to

Eng.

proposed prearranged

Prospects
Eng.—
of not likely to last

—

-mfinn
action

spiral

wage

+M
to

improve somewhat at the
N

of
mber,

ove

the

Minister

of

<<rn

The

be-

ginning
when

_

any

more

•

than

,,

.

Twelve Apostles

i

Opposition seized upon a
letter published recently in "The
Times" and signed by 12 more or
less eminent Oxford
and
Cam-

Health

bridge economists, demanding the
cessation of disinflationary measdemand of ures, for
fear that they might
N a t i o n a I
aggravate .the downward trend
Health
Serv- of world commodity prices. This
ice

employees

for

a

3%

crease

of their

and

wages

Dr. Paul Einzig
'

this

ness

colnrioc

Thi«

action

con-

veyed the impression that,
after all,
the

-

Government

really

time

in-

is

afraid

not

of

unpopular steps in the interest
of arresting
inflation.
But
the
outcry of indignation by trade
unions
tion

and

the

Socialist

to

appears

Government

have

hesitate

group

,.

.

,.

of economists

(they

came

to be known as "the 12 apostles"
of the creed of non-resistance to

inflation)

were

challenged

concessions.

wage

to

be

influenced

•

trend

increasing

thenkf^hc

ence

the decline
commodity prices should become
reversed, they will not be in a
to

^maintain

reductions
able

deoosits

nowadays, so that
the commodity

a

•

once

Wm

t?

P

lJJ

BENTON
HARBOR, Mich. —
Norine E. Allen has become con-

recov-

markets
increase in

nected with Wm. C. Roney &
Co.,

Fidelity Building.

A Wage Policy Proposal

With Columbine Sees.
Lord Chandos> one of the lead(Special to The Financial Chronicle)
ing British illdustriaIists haa P"t
wage
wagedemands''""-were"conceded"
demands "were
conceded. forwardfhe
suggestion that
that thcle
there .DENVER, Colo. — Robert M.
Tw.aJa.M,e
su?sestl01n
should
be
a
Even though in each instance the fb"ldd
be a general
general agreement
agreement Allison is now connected with
number of employees involved between .e;?P^°yees and employ- Columbine Securities Corp., 1575
wag sma^
total o£ additional eis' Pr°vidm£ lor an annual 111- Sherman.
purchasing
power
released
by ?iease °f waSes hy 2/2% -during
w
pmninvprs is p'rinwin <*•«.'And
I. B. Haass Director
next five years. Whether such
employers
is growing: And every
now an^
again the price of some a Piearran£ed uniform wage inJrving B. Haass, Partner of the
goods or services is put up. Evi- crease >vould tend to stimulate New York Stock
Exchange firm
dently the okogc
"'-"mo'
stage has not yet been £rofd,rlA
tj-.f
t
1S* °P-n
rtian/jAa
,of. David J. Greene & Co.: has

Ss

.u

T

n.

.

„

..

,

,

Dur-

number

a

of

,•

mmw

'

•

uw(,

reached

at

which

impelled to

jci.ucwi

nu

employers feel

W

say

sistance.

t

elected■ a- Director
Cold^type' Co.

Commodity

1

nnciihnitvnffi'irSnl:

P°ssibility of official backing
being given to his scheme can^
"

outlook is

likely to continue until

ST-

ancler

Dalton

Co.,
.

218

offer to sell nor a. solicitation of an offer to buy
offer is made only by the Prospectus.

any

would

be

made

it

ment

did

decided

its

to

Drive,

-

of these Shares.

the

more.

6,549,124 Shares

Standard Oil Company

ac¬

They also
the Govern¬

that

intend

not

to

pressure

upon

merit.

plain

bear

r

>>

{Incorporated in New Jersey)

*

to

to

,

wage
demands.
So
the question whether the Govern¬
ment will really muster

{$7 Par Value)

enough

and

-

determination

bring inflation to
mained

There

the

Rights, evidenced by subscription warrants, to subscribe for these shares are being issued by the
Company to the holders of its Capital Stock, which righ ts will expire at ft30 P.M. Eastern Standard

to

re¬

Time

firm

the

attitude.

since

Nor

should

critics

Subscription Price $44

the
The several underwriters may offer shares of
Price set forth above

effec-'

face

in

the

(less, in the

not more than either the last sale

disinflationary policy would
to

Share

of

ignore,, the
an

a

last

adoption

great difficulties which
have

December 18, 1037.

on

Progress

Government

Government's
tive

.

has

unfair, however not
the progress made

towards

summer,
a

Been

Has

recognize

by'

halt

unanswered.

It would be
to

a

>!■

Capital Stock

tribunals to- induce them to resist

inflationary

courage

' l

bring
arbitration

ever

economic,

case

or

Capital Stock at prices not less than the Subscription
of sales to dealers, the concession allowed to dealers) and

current

offering price

is greater, plus an amount equal to the

on the New York Stock Exchange, which¬
applicable New York Stock Exchange commission.

social and political sphere. Within
the Government there is a

between
those

struggle
"appeasers"
and

the

in

favor

of

firmness, The
wing is led by the Minister
of
Labor, Mr. Macleod, who is
becoming increasingly unpopular
among Tory backbenchers. During
a
recent debate he triumphantly
quoted figures to show that the
former

rfumber

of

through
much
any

hours per

strikes

smaller in

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

MORGAN STANLEY & CO.

worker lost

last

year

Britai n

was

than

in

other industrial

KVHN

LOEll & CO.

THE FIRST BOSTON CORPORATION

country. He.
appeared to be blissfully oblivious
of

the

in

Britain

fact that

thisk

was

beause

there was much less
resistance to wage demands than
in other countries. The other side
of the

picture

represented by
the higher degree to which
wages
were

the
last

raised in Britain, in spite of
stagnation
of
productivity-

When

his

Chamberlain

Munich

he

LAZARD FRERES & CO.

FENNER & BEANE

LEHMAN BROTHERS

SMITH, BARNEY & CO.

\

STONE &

WEBSTER SECURITIES CORPORATION

WHITE,

WELD & CO.

through

absence

at the cost of

of

opr

that the rela¬

strikes,

was

DEAN WITTER &

"industrial

time." The latter is




CO.

F. S. MOSELEY&CO.

achieved

conceding excessive

claims,

peace''id

HARRIMAN RIPLEY & CO.
Incorporated

KIDDER, PEABODY & CO.

re¬

agreement

leod should declare

wages

GOLDMAN, SACHS & CO.

UNION SECURITIES & CO.

declared

with Hitler,
conceding him
everything, was "peace in our
time." Similarly, it was observed
in Conservative
circles, Mr. Mac¬
tive

GLORE, FORGAN & CO.

MERRILL LYNCH, PIERCE,

in 1938
from

achieved

EASTMAN DILLON,

CO., INC.

s

year.

turned
that

-

BLYTH &

Xouember 12, 1957.

DREXEL &

CO.

HORNBLOWER &

PAINE, WEBBER, JACKSON & CURTIS

F1a.—
Good-

no

cording

;

Beach

-

an

the

"

with

are

.

The

.

<

PETERSBURG,
J.

The decline in the prices of raw the outcome of the railway wages body &
the policy materials, too, tends to encour- dispute becomes evident. Mean-L North.

This announcement is neither

•

(Spccmi to the financial chronicle)

;
n

■

Two Witli Goodbody

,

Uncertainty about the industrial

Price

Decline

of

American
ih

not be dismissed out of; hand.

\,:

Offset

Wages

,•

for fear that

further increase ofltheir prices
would give rise to consumer re'

+i,

t

a

""Ministerial

issue

to
of

future

to the financial chronicle)

will mean a further
the prices of manufacturers.

both

nrices continues

and

raent

from

speakers
were
at
pains to emphasize that there was
question
of any
rigid rule
against' wage increases, and each

and

influ-

who^liqui-

nendinc

opposi¬

made

the

iarge"i>ro"

A

.W"!. V- iwney Adds

inconceiv-

manY Quarters to produce an al-

ternative solution to

Exchange

under

feeltaT

developments

in order
prices.
Wage; -v.

almost

in

ery

of that

bank

wages

their

are

Stock

T"
ion ^
investors

'

i-

position to reduce

the

sterlingre
remain

01 their dat«d their holdings continue
-aS See'?5
keep their funds in the form
in
world

£'.
n

probable,

i-t

of

while

many instances in a
position to increase wages with-

.

p

Industrial

in

are

busi¬

means

and

„

commodity
have
im-

to

jt

waires

The

flatly
rejected the

itself

*u

,

an
an-

non-resistor

The

HiH tho fnrmp.did
the former.

appeared

an
an

agitatibn which
might have provided for it an excuse for backing out of its firmer

productivity and notes
uncertainty has affected the Stock Exchange and
sterling.

Government

the

on
on

challenge.

appeared

allow

to

a

toe

check

aeiee
agiee

proved. It is to the credit of the
Government, that it has refused

uniform wage increase would stimulate
how wage

-

age

firms

(Afferent ooinions

not

to the

outlook

mate¬

rise offset, without

13

In the meantime the

increases, Dr. Einzig detects considerable
still firmer policy since "the increasing trend of

decline has permitted

could
couia

ami
ana

wage

a

rial price

1

*

'

' tepTthe'lf eco"

omis™held

By PAUL EINZIG
i

wntmg they ignored
challenge,
presumably
be-

constructive

Really Resist InDation?
\

Up

to the time of

the

13

WEEKS
CO.

54

The Commercial and Financial

(2114)

Chronicle... Thursday, Novenlber 14,1957

for something a little "better than the various bills referred to them
and are expected to report to the
average."
Four pre-requisites are neces¬ next legislature which will con¬
ment
terial is abundant at a compara¬ sary
for an independent to be vene in 1959. I feel certain that
tively low cost; the market for successful in Western Canada. You this bill will receive little if any
this
material, already
sizable, undoubtedly know what these are, support from the securities indus¬
mention
them anyway. try
will
increase
at
least threefold but I'll
or
supervisory officials in
within the next
10 years. The First,
a
diversified
spread
of Connecticut before proposed uni¬
natural gas development, just now selected land holdings on which to form regulations and forms are
look for oil and gas; second, fi¬ available.
Unquestionably
the
starting, will augment this.
resources
If you were to select a Cana¬ nancial
adequate
to Council will also require this in¬
maintain
formation
before
dian oil security
exploration and develop¬
making a com¬
that grew no
faster than
the growth
rate of ment programs in proportion to plete study of the Act. This would
the
size
of
the
land
the
holdings;
appear
to
be
the
logical legisla¬
industry as a whole, this
hypothetical security should show third, technical know-how, skill tive approach and it is reasonable
and 'experience,
to be able to to assume that other state legis¬
an
increase in value of three or
the Canadian oil and gas

is

Canadian Oil and Gas

Opportunities^

Investment

LaBORDE*

By EDWARD H.

Limited

President, Canadian Homestead Oils

exists in Canadian oil and

Outstanding investment opportunity

the judgment of Canadian oil company Presi¬
dent.
In making a comparison with the United States, Mr.
LaBorde notes the much lower exploration-developmental oil
natural gas in

and growing favorable export
sales-production increase within
augmented by recently started natural gas

costs, greater proven reserves,

position. Predicts a threefold
next

ten

years

combine

The

Idouble the actual production of
about 540,000 barrels per day. In
things to look at is the cost and other words, right now we can
Availability of the raw material— sell only half as much oil as we
;

In

considering

this

in

'

'/:!

demand.

On

sub¬

the

annual

give you
figures
covering the
10-year period

So

few

1947

^

in

"Wester

Canada

___

Edward h. LaUoro.-

one-half billion barrels

This

oil.

amounts

about

to

developing

and

eerves

the

proven

new

in the United States during

will

increase

least

at

possibly more. Right
Canadian crude oil require—

ments

amount to 750,000 barrels
daily. For 1967, the forecast is for
1.4 million barrels daily, or double
the present requirements,

Oil Exports to U. S. A.
in addition to the growth in our
domestic markets you will wit-

varied
from ness, over the next 10 years, a
triple
this large increase in crude oil exports
amount. Obviously an exploration to the United States. The United
dollar spent in Canada will give States,
with only 15% of the
period

same

double

itwo

almost

to

three times

to

the

reserves,

The results of exploratory and
development drilling last year in

Western

the

Canada

compared

as

States

United

bear

this

to
out

In Canada, the disratio
was
four-in-ten,
compared with one-in-ten in this
country.
New
oil
reserves
even

more.

covery

amounted

to

million

4.4

barrels

discovery in Canada, compared with 1.5 million barrels per
discovery in the United States,
On average, every oil well completed in Western Canada last
year can expect to recover 220,000
per

barrels,

with
96,000
corresponding

compared

barrels

the

for

United States completions. To look
at it

just

foot

of

way—for each

one more

hole

drilled

last

year,

Canada

in

Western

the industry
found 33 barrels of oil, compared
with 13 barrels per foot drilled in
the United States.
'

..

^

„

...

Favorable Cost Position
The

question

is: Will this

rate

of
discovery continue? You all
know that exploration in Western
Canada has just started, and that

stretches

vast

rnentary

the

of

large

sedi-

still in a virgin
comparative purposes I could point out that only
one wildcat per 160
square miles
Ftate.

areas are

But

for

has

been
drilled
in
Western
Canada's oil area, compared with
per
10 square
UnitedStates.
one

The

obvious

this is:

half
the

as

In

raw

in

conclusion

Canada

it

much to find

of

costs

and

the

all

about

develop

material—oil—as it does

in the United
Now

miles

of

veloping

the

raw

material-the

crude oil reserves—is

just the first
The reserves are of no
value unless there is an adequate
problem.

market in order to realize

a

.

Western

„

Canada

-

,

.

■

in

reserves

the

-From

a

talk

by Mr. LaBorde before
Croup of New York City,




tional

employee may become registered
that Association. This is a

of the various states.

It has been

that

announced

appeals all the
way to the United States Supreme
Court, if necessary, will be made,
consequently, it may be many
months

before

mination

will

final

a

be

be

that

nuities

the

sale

would

of

under

not

the

to

strued

policy would be con¬
a
"security" under

tain

of

material

securities

assistance
administrators

industry in making cer-,
that new salesmen are wetL
investment

prin-~

Connecticut

ciples and supervisory aspects of
the industry before they contact
the public as a securities sales
representative.
It is,
however,
difficult to understand why the

interesting
advanced

Act.

observation has
the

to

Connecticut

been

amended

:

An

been

that

had

Securities

Act

effect

The

.

as

securities

as

but

also

would,

in

basic

versed

Securities

applicant to be4
with state authorities
before permission is granted to
take the examination.
It should;
I
believe, be the reverse for it
seems very
unusual that an As^;

NASD requires the

registered

by

.

asset.

This

year,

?0
g

tha? Sll

wl&i

d

T

r

r a

a
„

A

though

n

t

the

ited

gaS

fit

gr°^n

m

mam

necticut

!L« ai?3

1ir,

®Jenough gas
seemed as
would never be

there

m

m0Tf ?aS t0 Satisfy the potenwe

.Conner+icut fraternal bene¬

Insurance

n

tiaA market requirements.
Now

a

society, wnich was in the busi¬
ness of issuing insurance
policies
under the supti vision of the Con¬

have the

reasons

from

issuing

policy to be known

variable endowment policy.
The court held that the definition
of an endowment insurance
as

a

pol¬
icy which the society was author¬
ized to issue, did not
encompass
a variable
annuity contract, and
♦An
40th

address

Annual

sociation

why

a

Department,

Santa

cf

by

Mr.

Hall

Convention of
Securities

before

the

National

As¬

only is
Certainly

not

tions,

necessary.

logical but
state legis¬

a

lature should want to know about
the

proposed regulations to be is¬
under the Act, as well as

sued

the

merits

cite

a

of

the Act itself.

To

specific example, the entire
Securities

Uniform

troduced

■

Act

Legislature this year.
lature took

no

action

but merely referred
islative

Council

for

-

was

in¬

Connecticut

the

.into

The legis¬
on

study.

This

Council consists of the legislative

Administrators,

Fe, New Mexico, Oct. 7, 1957.

leaders and they make a

*

April 23-25, 1958 (Houston, Tex.)
Texas Group Investment Bank¬
ers Association annual meeting
at the Shamrock

HoteL

(Canada)
Investment Dealers' Association

June 9-12, 1958

of Canada annual

Manoir Richelieu,-

convention at
Murray Bay,

Quebec.

this bill

it to the Leg¬

study of

-

the

the definition of that term in The

the

to

and

be

be

the

to

determine whether

an¬

the

were

variable

come

or

.

commendable procedure and

should

policies could be made. The

originally pro¬
posed, it not only* would have
placed the issuance of such pol¬
icies under the same supervision

deter¬

If

made.

final decision of the court

very

did not

past year the Na- i
of : Securities

Association

amination prepared and given! by
their Association before the new

obtained before the sale of

such

the

Dealers instituted a p r o g r a m
which requires all member, firms
to have new salesmen pass an ex¬

Free

does, at the enough market for Canada's idle
moment, have a marketing prob- gas. The situation has now relem. The production
capacity or versed itself, and producers will
a
million barrels daily is nearly be
concentrating on the search to
tbe oil Analyst
Oct. 31, 1957.

D uring

with

court

r y.e

EVENTS

thnn«*h
.

Annuity contracts are exempt from
regulations by the Securities and
Exchange
Commission
and
are
subject to insurance regulations

arid

-Dealers

-

legislative permission would have
to be

members of

N.6

reve-

hue from them.
,ir

oil

finding and de-

course

Recently a Federal court in
Washington ruled that Variable

of

supervision of the SEC on the inference permit the issuance and
Federal level, it would not auto¬ skle of such policies by all Con¬
World, uses 60% of the Free
necticut Insurance c o m p a n i e s, sociation of this type would atr
World oil production. Good eco- matically mean that the adminis¬
trators on the state level would should their charters permit the
nomics would dictate that the
tempt to set itself up. as a "final
United' States must continue to assume similar i supervisory au¬ sale of securities. Naturally, such
authority" and in effect pre-empt
an interpretation would have re¬
import at least some of its crude thority. Changes >in state statutes
I am certain
would undoubtedly be required. quired court determination but it state supervision.
oil needs, and Canada rates as a
is a factor which should be given that a logical solution can be re¬
logical source for a large portion It. would, therefore, seem advis¬
when
able for state administrators to consideration
changes in solved.
of these requirements. Firstly, the
seriously consider instituting ac¬ statutes are contemplated.
reserves are close to the market;
tion for such changes.
Possibly,
secondly, Canadian oil costs half
Uniform Securities Act
With Oscar G. Werner f
as much to find and develop; and however, such statutory changes
The Uniform
Law Committee
should be sponsored by the securi¬
("Special to The Financial Chronicle)
thirdly, ours is a politically "safe"
ties industry, for certainly that in¬ presented to the National" Asso¬
and
dependable country to do
PASADENA, Calif.—Richard C.
ciation of Securities Administra¬
dustry
has
a vital interest in this
business with,
tors at its last convention, in its Ashmore, Bert L. Sharp and Wil¬
In the Puget Sound area of problem. The type of sponsorship
final report, a proposed Uniform liam H. Stephenson have joined
Washington alone, two refineries of such legislation would be de¬
termined on an individual state Securities Act. It appears to me, the staff of Oscar G. Werner &
with combined capacities of 90,000
level basis for unquestionably it therefore,
that to guarantee a
barrels daily now use Canadian
Co., 3870 East Colorado.
would vary between states.
complete uniformity in the appli¬
crude exclusively. Planned recation of the Act upon enactment
finery construction over the next
For
example,
in Connecticut that its
interpretations through
four years will increase this to this year, the securities industry
between 225,000 and 260,000 bar- sponsored a bill which would have regulations should also be uni¬
C O M I
A lack of uniformity in
rels daily of refinery capacity included in The Connecticut Se¬ form.
regulations and the various busi¬
using Canadian crude oil exclu- curities
Act, variable
annuities ness forms
required in adminis¬
sively. This is just one United under the definition of the term
In Investment Field
tering the Act could, in effect
states oil importing area.
"securities."
This bill, although
negate many of its benefits.
The
"Oil
and
Gas
Journal" receiving
strong support from the
The task of proposing
^ set of
recently
predicted
that
United industry, was referred to the
Leg¬ uniform
regulations was assigned Nov. 23, 1957 (Philadelphia, Pa.)
States imports of crude oil, now islative Council for
study as the this
investment Traders Association
year to the Association's Law
running at the rate of 1.5 million result of the strong
opposition Forum Committee. The commit¬
of
Philadelphia fifth
annual
barrels
daily,
will
amount
to from legislative
representatives of
dinner
dance
at Germantowri'
2.61 million barrels per day by the insurance industry. It was tee, unfortunately, had many per¬
sonnel changes and all members
Cricket Club.
1965, an increase of more than a their contention, although they
were busy with
legislative prob¬
million barrels a day in eight freely admitted a complete lack of
Dec. 1-6, 1957 (Hollywood Beach,
lems.
Early
this
summer
the
years. A large portion of the inFia.)
knowledge of securities super¬ committee informed me that,
they
creased imports will come from
Investment Bankers Association
visory laws and policies, that the felt
time did not permit them to
Canada,
Annual
Convention at Holly-*
insurance
companies
should
be make
any significant progress on
wood Beach Hotel.
solely supervised by the insurance this
project and even raised the
Natural Gas Bonus
departments of the various states.
question whether or not the As¬ Jan. 17, 1958 (Baltimore, Md.)
There is an additional bonus
Shortly after this
legislative sociation should, at this time, un¬
Baltimore Security Traders Asr
^0l* exploratory oil companies— action the Connecticut
Supreme dertake the task.
f
sociation 23rd
annual mid¬
na*ural gas. Until this year, it Court of Errors handed down a
It would seem that the prepara¬
winter dinner at the Southern
was 110 bonus. It represented an decision which in effect
prohib¬ tion^ proposed uniform regula¬
Hotel.
J
known

unsaleable

States.

-

*

that

70

findoil re-

r'

Regulation of variable annuities under state securities and not
insurance statutory law, states' uniform securities act and
uniformity in regulations, and NASD's pre-emption of state
supervision are three different topics commented upon by

United

the

of

basis

National Association of Securities*

Securities Administrator, Connecticut

known

Committee

this task might

.

,

President, National Association of Securities Administrators

annual rate of loss

that

Association

commences

the various securities groups
other experts in this field.
*

Developments

By MELVIN O. IIALL*

reserves.

our

the

find it very beneficial to request
the assistance on an advisory or

President of National Association of Securities Administrators.

duction

cents per barrel. The cost of

ing

States

within the next 10 years our pro-

now,

exploration and development (ineluding land costs) resulting in
the discovery and development of
of

an

half

threefold

n

on

three and

and last—a little* bit of

luck.

consultation

look at New

with an
production

would venture to predict

I

was

spent

with oil

States' Securities Administrators

States.

A total of $2.5

billion

looking

latures would act similarly, par¬
ticularly if they presently have a
securities act which is adequate
and
workable.
It well may be

resources

which

nowproven

producing

at

reserves

1956.

to

reserves;

is

investor

wise

financial

compares

of

10%
are

we

than

the

of

This

United

of

rate

than
a

4j/2%

reserves.

better

no

the

and acreage and come up

that

capable of producing. With a
production rate of 540,000 barrels
daily and reserves in the order of
4.5
billion
barrels, our present
annual production rate represents
about

ject of avail¬
ability I can
do

10

are

case

secondly,

the

next

of the first

one

crude oil—
and

the

during

industry,

any

that

think

times

four

years. -

development.

would

industry
outstanding field of invest¬
opportunity: The raw ma¬

an

Sept. 29-Oct. 3, 1958
(Colorado
Springs, Colo.)
National Security Traders Asso¬
ciation Annual Convention at
the Broadmoor.

*»

Volume 186

I

Number 5690 ...The Commercial and Financial Chronicle

(2115)

15

td"/'
vLV~.

•

<.

.

demand

Customer Relations and

all types of customers, both large
and small.
It is liKewise no mere

banking services that

or

number

ihe

bamc

oi

accounts

per

100 population in tnis
country nas
increased from 45 in 193d to 77 in

coincidence
10

tistics

Vice-President, Manufacturers

N. Y. City

often

industry" has

expansion vis-a-vis population rise and
magnitude of the market, Mr. Warner stresses the im¬

advertising in cultivating small

well

as

and investors

Not

accounts and small

W

but

addition

ing

of them had

any previous

selling

experience.

This

led

depositors, borrowers

banks to sell their services

rious

other

of cus¬
tomers who
types

deal

with

banks,

a

bank

would simply
be

invest-

an

somewhat

«

success.

sporadic

to

the

accounts

to

efforts

be,loaned

remains

and

check¬

in

the

as

that fact

success we

have

growing both absolutely
relatively in the last 25 years.

as

At

a

point

would

I

word of caution.

like

be

re-

vi duals

quired

to

in-

and most people and businesses
could not qualify for credit. Der
posits
ijwbuc piled
jjutu up
ui/ in banks, and there

Federal

was no point in

ent time.

mana¬

and
tutu

ger
gei

few

a
ct

xcw

Bradford

A.

Warner

vest the bank's

capital funds
and

the

and

you

jobs!

So it

I

buildings,

ployees

there

are

bank.

be

out

to

serve,

the

has

directly

customers

of

or

the

It

would, therefore, be
equally true to say that, for the
most part,

pays our

-

Sin^

it is the customer who

salaries, for it is

-

or

the in-

inwfnnJ"

-

Good
If

,

did

not

.

need

to

borrow,";i945!* Sample studies made by the

seeking more debecause banks could not
lend or invest; the money, they had
—except,-at ."starvation" interest
rates.

The/jso-called "prime rate"
y2% with few takers. Short-

1

was

term

securities

government

yielded less than 1%.

'%

,

During World War II the banking situation, reversed
itself in

fr°™ s?m*

ways but still did not gener-.

Reserve

System indicate.
that about 47% of all families are

using instalment credit at the pres.

banks

the

Inasmuch

account

as

for

about

instalment

total

■

other

or

customers

-

expenses

for the conduct of the war, deposits

I do not
say

tjnese things to beobvious, but merely to

the

emphasize the importance of the
customer in the
banking world. If
banking is to progress, and none
of us wishes to be
engaged in a

business which is not
progressing,
we

must

have

more

and

better

This, too, also borders
the obvious, but in the
light of
the
history of the relations of
banks with their customers one

on
xi.

,

might point out that for

a

great

many years the people who
aged banks behaved as

man¬

though it

not obvious at all.

Subject to minor exceptions, the
American banking system
prior to
World War I

simply

grew with the

expanding economy. When there
were
depressions there was trou¬
ble.

When "times

money

there

were

good" the

just

kept coming in, and
always were more than

enough

credit-worthv

borrowers

to enable the bank to lend
as much
of
its funds as it chose.
Bank

managements, for
took the attitude

the

most

that

it

privilege

to

bank and

they waited for

ers

to

come
was

do

in, and in

regarded
regaraea

u^uified, if

business

in.

come

a

with

a

custom¬

Customers
most

did

instances it

bankers
Dangers as
as ununriot unethical, to soby
oy

licit business.

in banks and

up

in

The Liberty Loan
campaigns of
put an end to this quiet,

pastoral atmosphere. As a patri¬
otic duty, banks found themselves
almost
automatically nominated as
salesmen for Uncle Sam.

counts.

_

With the return of peace in 1945,

however,

a new

phase began.

had effected

war

a

The
redistribution

of personal

incomes in this coun¬
try—a "leveling down and a level¬
ing up"—and thereby started a
which

trend

is

still

continuing,

with assists frqm the labor unions
and the progressive income tax.
Stated
simply, since 1945 there
have been

more

than

money

peonle, in
banks

for

lives,

and

them.

up

before.

ever

the

first

there
a

wore

These

instances, needed

many

Thus

opened

peoole with

time

their

millions

are

brand

in

new

of

market

Commercial Banking Rise
To

illustrate, let

quote some

me

figures

compiled by the Federal
Deposit Insurance Corporation as
to

the

number

carried

counts

mercial

banks.

of

by

checking
insured

These

ac-

com-

banks,

as

you undoubtedly know, account
for more than 98% of the banking
tw
The

tnliv

tally

follows:

us

Year

Number of

Checking Accounts

1936-1

22,109,000

1941

26,293,000

1945—

Thus, in

a

19-year period when

136%.
I
so

afrd-Orn

Exchange
Pa., Oct. 5, 1957.

Bank,

of

Gir-

Philadelphia,




,„c_

year
any

ing
been

after year, in order to create
impression at all on the con-

an

offering of these shares for sale,

f

*

because our markets have'
broadening, and sometimes

Continued

•1

on page

or

an-offer to biiy. or a solicitation of
is made only by the prospectus.

an

34

offer to buy.

of such shares. The offering

j am wtU aware that statistics,
are boring but those I have just

,

$65,000,000

to show the

magnitude of the market for bank¬

Caterpillar Tractor Co.

very fact should
thinking to the ex¬

ing services. This
influence
tent

our

that

as

rather

than

customers.

for

look

should

banks

"markets"
viduals

for

4Vi% Sinking Fund Debentures

indi¬

Due November 1, 1977

In promot¬

bank to
in solicit¬
ing small accounts individually.
The logical medium for promoting
the use of banking services by peo¬
ple of moderate means is through
advertising, supplemented where
necessary by individual solicita¬
tion to a limited degree as I will
explain later on.
ously uneconomic for

use.

1

▼

know
massive

grasp

that
that

these
it

is

.

a

Copies of the prospectus
writers

may

be obtained from any of the several under¬

only in stales in which such underwriters are qualified to act as

dealers in securities and in which the prospectus may

legally be distributed.

Blyth & Co., Inc.
The First Boston Corporation

Kuhn, Loeb & Co.

Eastman Dillon, Union Securities & Co.

,

Dean Witter & Ga.
Glore, Forgan & Co.

Kidder, Peabody & Co.

Ilarriman Riplev & Co.

Goldman, Sachs & Co.

Incorporated

Recently outgoing President

Lehman Brothers

Lazard Frcres & Co.

•

Merrill Lynch, Pierce, Fenner & Bears®

of the American Bankers Associa¬

tion, Erie Cocke, stated the matter

cogently

very

"With

today's

competition for
the consumers' dollars, hanks can't
come

to them.

expanding facilities to
meet new needs, banks must do
everything
they can to let the
~

public know about these services."
At this point the traditionalist
might very well ask the question,
why bother with small accounts
and small loans?
Doesn't it cost
us more

to handle them than they

worth?

are

And it would not be

difficult for a cost accountant by
making the proper assumptions to
prove that the margin of profit
on small checking and savings ac¬
us

answer

Stone & Webster Securities

Smith, Barney & Co.

So

the question with

a

Francis I. duPont & Co.

Laurence M. Marks & Co.

swer

would

seem

1945.

The

in

an¬

to be that bank¬

Bache & Co.

Lee Higginson Corporation

Schwabacher & Co.

Reynolds & Co.

Walston & Co., Inc.

G. II. Walker & Co.

Spencer Trask & Co.
Wood, Struthers & Co.

R. S. Dickson & Company

Baker, Weeks & Co.

Incorporated

First California Company

Elworthy & Co.

First of Michigan Corporation

Incorporated

Goodbody & Co.

McCormick & Co.

'

McDonald & Company

Putnam & Co.

Newhard, Cook & Co.

McDonnell & Co.

Shuman, Agnew & Co.

Watliug, Lerchen & Co.

William R. Starts & Co.

J. Barth & Co.

Robert W. Baird & Co.,

Bacon, Whipple & Co.

Bateman, Eichler & Co.

Incorporated

Blunt Ellis & Simmons

William Blair & Company

Davis, Skaggs & Co.

loss of about 25%

Wertheim & Co.

Incorporated

Alex. Brown & Sons

has shown

a

F. S. Moseley & Co.

Salomon Bros. & Ilutzler

American Securities Corporation

Allyn and Company

Brush, Slocumb & Co. Inc.

deposits since

Drexel & Co.

Carl M. Loeb, Rhoades & Co.

W. E. Mutton & Co.

Paine, Webber, Jackson & Curtis

negative example. One large bank
which solicits only large business
its

White, Weld & Co.

Ilornblower & Weeks

Hemphill, Noyes & Co.

Hallgarten & Co.

A. C.

Corporation

Dominick & Dominick

Clark, Dodge & Co.

follows:

as

ing, like any other business, must
are-know where its markets are and

Far well, Chapman &

Hill Richards & Co.

J. C. Bradford & Co.

Crowell, Wcedon & Co,

Courts & Co.

Co.

Hooker & Fay

Henry Ilerrman & Co.

Irving Lundborg & Co.
The Milwaukee Company

Carl McGlone & Co., Inc.

f

figures
difficult

their significance.

to

Perhaps

it would be easier to remember
an

Price 99.5#%
Plus accrued Interest from November 1, 1957

valuable manpower

The

let

52,129,000

30%, the number of checking ac¬
counts carried by banks rose about

meet¬

years our cus¬

tomers of banks has been increas-'

consistent repetition of an adver¬
tising theme month after month,

any

counts is very narrow indeed.

35,622,000

-

1955

everlasting credit, they did a
job in selling Liberty
bonds to the public,
especially so
because, for the most part, none
a

increasing in recent

Advertising Banking Services

Besides

the population increased less than

*An address by Mr. Warner at
ing of the officers and directors

and

easy

oj: customers of banks has been

nrtniU

promoting business. There must be

This is not

;

wait for business to

for banking services.

To their

splendid

an

,

nation
business of the nation.

1917-18

secu-

to take

We liave occasion to remind our tomer relations must be good, but
operating officers that one single that^'as' the catch phrase in the
advertisement, standing alone, has popular song goes "ain't neceslittle if any value as a means of
^
ml,,p
a weans of sgrily so."
„
fnut
^
The number of
cus--

ing the traditional type of bank¬
spend more billions, and so on.
ing services,
ing
services, Ii know,
jviivw, all of us
UJ have
""'"I
Because
of
wartime
personnel,
thought of obtaining the accou
shortages, banks found it difficult 0£ John
Doe, an individual, insoto handle the business they had,
far as serving the so-called com¬
let alone seeking additional acmon man is concerned, it is obvi¬

is

Banking Promotion

were m-

government

more

Customer Relations

were

borrowing from banks through their
instalment loan departments.

rities to enable the government to

part,

was

piled

vested

customers.

were

government-

guaranteed "V" loans. As the goveminent spent billions of dollars

out

taxes.

labor

obtain

.

of

the bulk of the
income,
which the bank
pays its
and

and

out-

A

one

of all families at present are

.i.

Bonds

of

38%

credit

standing, it would be a safe assumption that probably 17 or 18%

2'"°™ "h
deI'.osl- ate a need for,promotional efforts;
^smomyjmdiendering
various —except perha ps
kinds of services to
jo sell^War 'mentioired'were.;cIted
the depositor
that provides

commercial

■

-1

All the ad¬

ourselves that because the number

..

...

But it is not

superficial, view of the matter of
customer relations, we could tell

•

of' posits

em¬

large bank

a

of

that all

officers,-and

which

'indirectly,

would
be said

can

-

good sign.

a

1946

This, I

ject of business development.

—

-

million this year.

qu*reAP
:y,
r ^ n?w
ia.eas
a.nd ?
^consistent haid work
keeping
everlastingly_ at it.

would

a

to $100

million in

tomer relations ties in to the sub¬

.

with

advertising

from $20

effects of poor service to
the customer. This Is where cus¬

1n(^

has

increase

total

set the

magic formula for developing
new markets for
banking busi¬
ness. : One might say that it re-

security analysts is all that

the

that

vertising in the world will not off¬

no

Again i n the Thirties,., still, been so spectacular that it is alspeaking generally, there was no most unbelievable. The amount of
ve already mentioned advertisstrong incentive for banks to pro- instalment credit outstanding at all
Jn& as ajn?ea+1?5
developing marmote business, but for an
*—w,
opposite commercial banks as of June 30, * kets al?d ln this sector consistency
reason. In the depression years, last, was approximately 16 1/2 times
'1S
Perhaps
more
important than
nines
—
nn*4
credit-worthy- business and indi- the total volume at the end of anywhere else.. Again and again

a

credit

recognizing

the sole requirement.

the

and-

stalment

are

of advertising in
their markets. The

creased

think, is

There is

office

;

whole

a

estimated

to

pany,
small

i.

as

importance

expenditures of all banks have in¬

absolutely.

this

tion.

•

between

cultivating

com¬

.

reader

institution and the

American Bankers'Association has

ment

'

the

now accounts for a little
than 9% of the total deposits
all New York
City clearing

utter

at

relationship in

a

the

Our bank

.

interest.

.--..v*

banks

in

well

of

up

of

as an

more

of

profitable savings, carried by commercial
Briefly,\there banks has increased more than $18
was
no.
compelling reason,for billion, or better than 60%, in the
banks to engage in sales promopast 12 years.. In the field of inof

rates

well

to

house banks, whereas in 1940 we
accounted for 5.15%. This is what
I mean by growing relatively as

commer-

total amount

as

and

business

1

in to open

things that we can do for him.
Then, when the prospective cus-'
tomer needs a banking service he.
Will automatically think of us as
a place
to obtain it, almost sub¬
consciously.
.It would appear that American

Growth

Manufacturers Trust

we

build

the mind

historical back-

attribute what

had

In

savings banks, the fact

that the

Bank>s
our

large customer,

cial banks to meet the competition
of savings and loan associations
and mutual

must

ourselves

bank for the small

a

we

carried

banks

said about the failure of

,

could

million

52

Qwn

rusn

"v

Banking

account, simply because they
have read an ad of a bank, as they
might go into a department store
the day after reacting an adver¬
tisement of a bargain sale.
We

company have almost always been

by insured
1955, they
also carry 52 J/2 million savings accounts.' Although much has been

by
during
the Twenties, .but the expanding
economy of that period kept the
money rolling, in, and generally
it

groun(i}

accounts

savings accounts and

commercial

..ft would be trite but true to
point out that a bank could not
exist without customers.
Without
va-

in

checking

pansion in the last 10-20 years.

loan department.

and the

also

cites

Because of

the years to come,

m

in

and people do not

customers,

come as

*

.-

* an

materially in the direction of
letting people of modest financial
means know that they are wel-

in instalment loans have banking
services shown a tremendous ex¬

as

....

alone

that within the past
number of large New

very

sometimes

and

opportunities for both employees

large customers. Emphasizes results gained
from better
location, higher savings deposit interest rate,
remaining open Monday evenings, and. improving personal

to

"growth

used

rather

commercial bank

loans

OS-

term

been

in

portance of

r

the

Trust Company,

loosely in recent years, I
think these figures prove conclusively that banking really is a
growth industry and that it offei s

the

O'i

are available, and has gone
to at least 80 by now. Although

Manufacturers Trust official presents a concise tract on his
bank's
philosophy and approach to business development and
customer relations.
In referring to the much faster increase

£
»'«,?

up

a

York City banks have seen the
light and have decided to expand
their advertising expenditures

latest year for which sta¬

it>oo, rne

By BRADFORD A. WARNER*

years

/

sciousness of the public.
a
quasi-professional

is

as

index of the growth in public

cultivate

them.

It

is

no

accident

that the world's largest bank was
one

of the first,

if not the first, to

seek and cultivate the business of

Mitchum, Jones & Templeton
The Rohinson-IIumphrey
November 13, 1957.

The Ohio Company
Company, Inc.

Piper, Jaffray & Ilopwocd
Sutro & Co.

and Financial Chronicle

The Commercial
16

.Thursday, November 14, 1957

..

(2116)

sheltered and the company

THE MARKET... AND YOU

Ignored -"

Diversified Leader

although it
is commonly
considered ay
bellwether by virtue of the
fact that it is a component of
Corn Products,

By WALLACE STREETE

i;

is

financial condition.'.

in strong

By BRIG. GEN. DAVID SARXOFF*

,

Chairman of the Board, Radio Corporation of America

,

i

Various

forces

diverse

in

market

week's -stock

this

added up

mostly to some more
uncertainty., -sprinkled with
some
definitely easy spots,
and left wide open the ques¬
tion of what

The

next.

Rights Transactions

Record
,

comes

big fanfare was in the

offering of Standard
Jersey. The fact
some 196,500,000 of these,

rights

Oil of New
that

rights will be issued led to
some hectic trading.
On the
first
appearance -after they
were admitted to trading the
,

opening block came to 8,500,000 and afterward six-figure

explained deluge of either
or rights, without sup¬
port, send the entire market
into
a
tailspin.
Other oils
suffered sympathetically and
some
of the news items of
stock

.1

<■

•

to steel

fanciers, and increases

in auto

production were writ¬

off

ten

the inevitable re¬

as

when

bound

model

new

a

There

underway.

gets

year

little

was

in

even

ultracautious.

but

anything

Nor did the stress on

#

C-

no

the

stood

the market

intention of add¬

❖

*

❖

where

3-for-l split
in 1955, the issue has lolled
in a range of only around half
a dozen points while the
in¬
dustrial average, of which it
is a part, has reached historic
levels and, lately, suffered a,
rather sizable

reverse.

❖

order of 25 cents
the

share, but

a

projections carry all the

are

the conservative side,

on

with

The estimates

1960.

to

way

not

all

of

the

foreign

offering but it pany, available for periodic tions that mild interest was
shares at a investment in listed trading, also
being devoted to Wrigley
fat discount below the going
a
yield of well past 7% (in¬ which is a high grade item
price of the stock, as against
cluding distribution from cap¬ that is an important member
the few points available in
ital gains) is offered, it was of the defensive section when
the Jersey situation.
just that much more added market going is rough. Here
*
*
inducement.
This particular the sales
pattern has been one
General Motors might be issue—to illustrate the mar¬
of good growth but with earn¬
comparable when it issued ket neglect—hasn't wandered
rights to 4Vs million shares of over a range of a full half ings fairly stable because of
new
stock
in
February of dozen points so far this year heavy promotional expenses.
-

_

1955 but at that time the GM

and its

full

dozen

that

happened in those years.

would

exercise

less

no

than

20 million of that bundle. The

market climate

was

also

more

favorable.
*

*

*

the Jer¬

offering of $288 million

ranks both behind GM's $328

million and
million.

Telephone's $573

But

the

in the amount of

able

in the

difference

rights avail¬

"float"

set

since 1954 isn't

points despite

❖

a

all

*

*

market
to

W.

is

name one

stocks

ignored

that

T.

by

the

Grant

Co.,

of the many store
haven't been in

%

demonstrated

investor

de¬

long while. The
same
evidence of neglect is
apparent here—a range of not
even
10 full points, a yield
nudging 7% at recent prices
and a price recently that was
the

lowest it has been avail¬

able

in

a

The progress of trading was
watched closely lest any un¬




of

better

handful

of

years.

than

$400

million

for the first time in its

history.

sheltered

quate for

do

in

expressed

not

coincide

''Chronicle"

ade¬

and

long

Its dividend is well

in which to utilize

this

at any

with

of

They

those

"

the

only.]

CHICAGO, 111.—The

Executive

Midwest

Stock

ship in the Exchange the follow¬
ing:

Levering

Illinois;
Clark

&

Cartwright,

Valleau
Joel

have survived

-

the

&

H.

Co.,

Cart-

Chicago,

Clark,

Associates,

Second

Inc.,

Joel

washed out

of

H.

Texar-

Mc-

Hugh, James J. McNulty & Com¬
pany,

Chicago, Illinois.

before

resources.

answer, as

~

they had

re¬
few months earlier:in

a

Poland, and three years
East Germany and in

in

Siberian slave camps like Vorkuta.
We
know, "as
the. Kremlin

favorable

a

opportunity to strike again. Tanks
machine

in
aeronautics,

sullen

guns

obedience

-can

but

impose
alle¬

not

And we know that the
e1e ctronics same explosive forces of discon¬
and nuclear tent and despair, the same Godscience.

shrunken
David

where

political

Sarnoff

produce

quently
where.

Like

become

world

it

in

brother's

seemed

explo¬
any¬

and

tremors
or

not,

der

Communist-held

It has

this

our

who plan

our

tensions

ternal

the

Soviet society represent

long

ago

est

remote

and

exotic

to

the

in

links

level of
the weak¬

every

on

on

not

but

strategy

policy should at all times take
element in the world equa¬
tion
into their calculations.
In¬

which

anyone

including-

land,

been my conviction

long

those

that

every¬

have

'

Russia itself.

and

we

Areas

hungers for freedom and
dignity, are maturing un¬
the
surface of every
other

human

fre¬

measure

keeper.

too

interest

and

sions

large

map

so

that

social

instant

serious

in

world

a

giance.

given

live

We

Kremlin's

chain

therefore our great¬

of power and

archeologists

est opportunity for making com¬
anthropologists have now be¬ mon cause with the direct victims
items of front-page news,
of Communism.
objects of Cold War rivalry and

and

come

seedbeds

of

of

One

international

the

main

trouble.

objectives of

Soviet intrigue and diplomacy has
been to isolate the United States

by stripping it of friends and al¬
lies.
Every
symptom
of
freeworld disunity—of what the Com¬

For

years

many

we

contest

fateful

the

have seen

between

two

depends the fu¬
country
of the human race. On at least
front of this complex strug¬

worlds

which

on

ture not alone of our own

but
one

involving communica¬
been not only an
onlooker but a participant.
And
camp of imperialism"—brings joy
it has seemed to me increasingly
to the Kremlin. Moscow has used
clear that the contest is essentially

munists call "contradictions in the

everything from cajolery to black¬

gle, the
tions, I

one

have

ideas. Abstractly, this
widely acklowledged
ring of a platitude.
liances.
It has
not
hesitated to
But concretely, we have not yet
make
naked
threats
of
nuclear
translated the platitude into policy
annihilation against country after
and action of the necessary po¬
country aligned with the West.
tency and on the necessary scale.
mail

in

NATO

its

drive

and

other

to

break

up

defensive

al¬

This concentration of enemy

fort should

be

sufficient

a

been

ef¬
Technology and Ideology

importance, at our
end, of strengthening existing al¬

II

liances

two

and

so

that it has the

critical

the

of

war

has

proof of

conclusion of World War

At the
we

witnessed the emergence of

spectacular species of force,
at the very opposite
ends of the spectrum of power.
One was technological, dramatized
to Soviet policy.
But the allies, in V-l and V-2 missiles in the
actual and potential, whom I pro¬ European theatre, and in the first
pose to emphasize, are in another atomic bombs on the other side of
winning

new

friends

the so-called uncommitted

among

seemingly

nations. Every affirmation of freeworld solidarity is a body-blow

and too often neglected dimension.

The other was ideolog¬
manifest in the thunderous
clash of 'isms, the collapse of old
I
refer not
to nations but to colonial empires, the dynamic So¬
peoples: to millions of men and viet challenge to the very founda¬
women
on
the dark side of the tions
of
our
civilization.
Since
and

Iron

Bamboo

Curtains

who

is therefore

the

the

globe.

our

cause.

both species have unfolded
expanded at a dizzying pace.

then,
and

They

At

the

technological

end,

we

legions of freedom have seen breathtaking aeronautic,
deployed on farms and in fac¬ electronic and nuclear progress,
tories, in schools and offices, in now converging in a climactic
secret

the

Armed

the

ranks

Forces

of

the

and

even

in

parties,
throughout the Soviet empire.
This week marks

ruling

anniversary

the Intercontinental Bal¬
of delivering

weapon:

listic Missile capable

unprecedented

destruction

and

this earth
The artificial
in
one
"moon," launched by the Soviets
year
ago
that
the
people
of early this month which circled
Hungary made their thrilling bid our globe every 95 minutes, is a
for freedom. Those who scoffed at
symbol of scientific achievement
the possibility that the victims of
packed with peril to the human
an

glorious and tragic. It
the last week of October

at once

was

Communist dictatorship could ever

D.

it

Poznan,

headlong

rise

John

ceived

and

Hincks Bros. & Co., Inc., Bridge¬

Connecticut;

flaming

by, hearts, and await only

decade

a

kana, Texas; George A. Dockham,

port,

a

World Warf knows,'that the Hungarian people
have been have "..not"* surrendered
in
their

cause

Exchange has elected to member¬

wright,

'

presented hate their Soviet chains and whose

are

Midwest Exch. Members
the

opportunities and

with'

dispense

is, of course, too obvi¬
ous to require elaboration. What¬
ever
isolationist
illusions
may

are

of

cannot

we

our

allies

;

or

Sees at the most five years

other.

That

will not come about
capable of annihilating, the
for our allies and ourselves

argues wars

each side is equal to,

as

Captive Peoples Are Our Allies

necessarily

those of the author

Committee

long

so

ical,

quality issue.

views

article
time

a

a

some

*

yield of 5 V2 %, however,

both

is

as

The variety chain company,
trading records that will
however, has been busily ex¬
probably stand for a long
panding and is aiming at sales
time.
%

The

\The

Similarly

mand for

In dollar amount,
sey

area

assumption widely held which

progress

new

offering entailed only some
87.6 million rights and even
before they were out du Pont
had
added
considerably to
sentiment by announcing it

into

piecemeal basis rather than risk war, and to pose
or to frighten small nations
neutralism or submission. Attacks the "dreadful parity"
on a

champion of anti-colonialism

.-

stock

pegged the

a

❖

❖

hadn't called

excesses

as

Since it last attracted mar¬

earnings included in such
whether such a large opera¬
for any correction in a long figuring.
Only the amounts
tion could be handled success¬
time.
expected to be remitted are
fully.
included
and
*
*
*
foreign sales
Neglected Closed-End
growth is projected at around
The other recent ones that
Investment Company
10% per year.
had fabulous size were
Where, as in the case of
A Defensive Attraction
slightly different. American Carriers & General Corp., a
Telephone holds the record closed-end investment com¬
There
were
some
indica¬
a

yield

modest

a

of preventing a hot war. He makes clear that recent
vastly increased the Communists' capac¬

ity to exact "political blackmail" from big nations, anxious to

decisive,

by

to

the

as

Soviet advances have

by doing nothing

ket attention

a program

"cold war" offensive against the U. S. S. R.

a

surest way

long. It with-'
the October selling in

ex¬

ing to their holdings. With
Others were definitely de¬
the second largest share capi¬
fensive in their scanning, or
talization of any major Amer¬
did their foraging among the
ican corporation, Jersey was
definitely
neglected items
more or less a test case over

for

mount

the market for

There is little dramatic in
It made the market, and panding use of aluminum call
for anything unrestrained. store for the company, as far
particularly the oils, defi¬
v
#
*
as those who have studied it
nitely uneasy. The weight on
In the teeth of all the con¬ can see, but there is much
the price of the stock had
whittled away a good part of fusing signposts, and the thick favorable from recent diver¬
cloud of caution prevailing, sification efforts and reduc¬
the premium over the $44 of¬
some
of the Street houses tion in operating costs.
A
fering price to those who ex¬
even
gave up—temporarily— steady increase in earnings
ercise their rights.
any attempts to cull out issues is seen ahead following its
*
*
*
that could be recommended breakout of a stable earnings
Appearance of the rights in in clear conscience to the cus¬
pattern in 1955-56.
The in¬
such bundles indicated that
tomers.
And this is not a crease is generally held to
important holders of Jersey situation that
modest predictions on the
prevails often.

stock had

General Sarnoff urgently calls for, and presents,

important averages,
has been virtually ignored by
more

even showing a very
appreciation on the
month, approaches the 5%
Dismal Views of Steel Issues yield basis and has held this
Steels had little in the way year in only a hair more than
of fodder, operating rates a four-point range.
#
❖
❖
lending little encouragement

oversupply in various centers
helped the bad work along.

industry
trades were commonplace. So circles to indicate that auto
far turnover has riinfo around company buying of steel was

10% of the issue.

the

against their masters received

"An

address

by Brig. Gen. Sarnoff be¬
fore the 3rd annual meeting of the As¬
sociation of the U. S. Army, Washington,
D.

C..

Oct.

29.

1957.

death from any point on

to

any

other point.

race.

At

the

folding
has

ideological end, the un¬

has

come

to

crystallized in what
be

called

the

Cold

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

-\

(2117)

/

build

c

By JOSEPH L. BLOCK*

*

:

threats

confronting the

Inland Steel head

steel

t

industry

are

seen

by

constituting the greatest challenge ever
Mr. Block foresees his industry's loss
of freedom arising from the
following dangers: (1) steel's
inability to attract capital, based on comparably poorer earn¬
ings, will affect output rate and encourage, in turn, nationaliza¬

return,

that

this

be

the

of time, fared less well
maker

the outset exactly what I mean by
Steel
my
title
"The
Industry's

and

is

that

greatest

challenge fac¬
ing
is

the

i

n

d

u s

t

r

'

y's

freedom. ;

As

far

know,

I

as

one

no

at the moment

is

suggesting

that

the

be

nationalized

the

that

.

steel

industry

Joseph

or

L. Block

gov-

construct-

ernment

steel

new

plants. I am, of course, mindful of
England's experiences in respect
to nationalization, and do not find
it difficult to
recent

a

eral

reeall the

President

Government
mills

own

if

it

reasons

to

seems

individuals who attack

me

steel

the

that

threat

the

would

build

industry

of

Fed-

its

failed

E. M. Newlin Joins

aircraft
all

of

steel

and

12%

these

in

return

chemical.

industries

their

1956

net

on

petroleum, 14%
Yet

percentage

assets

tvettt

In

another
of

.

according to

question they asked

number

a

of

named

stock Exchanges. Mr. Newlin was
an officer of H. M.
Byllesby & Company, Incorporated-

al-

ternatives "would be of most
help
in stopping inflation." More than
half of the replies checked "Com-

formerly

good hard look at the facts,

a

profit

.

(1

..

Inflation

general,
that only

,

the

,

s

tistic

Threat

indicates

"Put

answer

back

that

Thomas Watson Sales

Mgr. for F. J. Winckler
DETROIT,

41%

checked

price

controls

do

ing

to
better and better job of tell-

story and getting it

our

And

we

must

start

with

across.-

our

employees.

I wonder how
executives
are
using

own

'

-

,

H. B. Shaine Go.

not,

..

To Be NYSE Members
„

GRAND RAPIDS, Mich,

— HyB., Shaine w.ilLv acquire a
membership in; ther New t York
Stock Exchange and; on- Nov. 21
H. B. Shaihe; &; Co.,:. Inc.; McKay

man

Tower

will

member

become,

firm.

exchange

an.

Officers

Mr.

are

Shaine, President; Edward M. Silverstein, Secretary,
Maurice
J.
.

Amelar and Richard J. Boss, VicePresidents, and Myron M. Sharp,
Treasurer,

-

wa"ls

p7'

..

Detroit

many

dS no^ adS^

to

the

w

Thomson & McKinnon

J

-

1—

J

-

...

I^CIltury ClUb Llinner

'4

Henry

Holt

of .Indianapolis,

York Stock Exchange,

and 18.0%,

'

U pMihirv fkik Hinniv

.

doubt the * difficulties of

anyone

yet?last veil

•

H.

associated

and Midwest Stock Exchanges, as
general sales manager. He was formerly in the syndicate department
of Baker, Simonds & Co.

the

the^

Thomas

Building, members of the

misconceptions, of the need
a

—

with F. J. Winckler Co., Penobscot

for awhile."

on

Here is clear evidence of popular

Mich.

Watson has become

ers in the chemical
industry, made fi,at anV waoG increases bevond °f our country and our fellow
public eye: We must be alert
.respectively; productivity gains inevitably lead citizens. W;th diligence and perde- General
vigilant to
nrir.P
inprpa^s
nnd
inflation
severance it can be achieved.
'
prevent
ut-■■wi.ct-ui- Electric,
metric the
ine outstanding
ouisianoing fn
to price
increases
and inflation,
velopment of conditions which are company in the fields in which it
>m* Uilfortunate but true, that the
conducive to such ideas, I beheve operates made
18.7%; and just to average American
today says, in
it is no exaggeration to say that round
Halbert, Hargrove Adds
it out, I might
mention effect
"A
plague on both your
the freedom of every American is ^ that euch a well known
(Special to The Financial Chronicle)
company houses""and points the finger of
directly tied to the freedom of the as' Gillette,: purveyors: of razors ^nqValikP'
Tnri^trv^and'lirhhr'"
L°NG BEACH, Calif.—-Jack A.
steel industry.
'
- :
' and hairdos, though not. a heavy
we took^ long and
Mofgan J?8®' heen added to the
;
•'industry, chalked up a return last • costlv strike to trv
to'hold the staff of Halbert, Hargrove & Co.,
Nationalization
-'year of 43.0% on its net worth. We
advance as clo
as nossible
115 P^e Avenue. He was formerly
We all know that governmental These are some of the
companies in nrodiictivitv gains
We'failed wit^ Gill'-Harkness & Co.
• .
controls
and
socialistic • activity with which
the leaders
of
the
in our effort, and got Tittle credit,
once
begun usually grow until, steel industry must compete in if anv for 1hG
high nUrnose we
Joins Bennett-Gladstone
like a,cancer, they can no longer the capital markets. '
•;
itteiwted to achieve,
(Special to The Fin4!$cial Chronicle)
be kept in bounds. A nationalized
While comparisons of return on
v
LOS ANGELES, Calif.

ever

a™-.

PHILADELPHIA, Pa.-—E. Mortimer Newlin has become associated wittl Janney> Dulles & Battles,
Inc-' 1401 Walnut Street, members
of the New York and Philadelphia

of

a compilation made by The First
National City Bank of New York.

which

Janney, Dalles Firm

>

exceeded

top
their
story. Whether we like it dustries, all labor organizations,
company publications to tell these
the larger companies in government — and in the final
important facts to their own peoevery industry must, in general, analysis, the general
public—share pie. All too few, I am sure.
Yet,
provide
the
greatest
growth, this responsibility.
■-<.
our employees are
literally bomTherefore, I think it is pertinent
If inflation continues
unchecked, barded by false
or
misleading
to
compare the earnings of the there is
bound to be a ground propaganda put out by those who
leaders and not just the
averages, swell of public
opinion for con- value the selfish
gains
of the
-Comparable Earnings of Leaders
trols of wages-and prices.
This moment more than the long-range
In 1956,17. S.
Steel, Bethlehem could well be another road toward good of their fellow
countrymen.
and
Republic, the three largest • nationalization and socialization The same can be said of the teachproducers in our industry, had a
which, as I have indicated, would ers, clergymen, editors and other
return
on
their
net
worth
of be so inevitable
if the industry thought leaders of our communi12.6%, 12.1% and 13.8%, respec- could not provide the
country ties. In instance after instance it
lively. Let's see how these fig- with its steel
requirements. In this is indicated that they have not
ures compare with the profitabilcase, however, all industry could had access to the facts, and have
ity of the leaders in some of our be
engulfed at once.
only been exposed to biased or
ether important manufacturing in- N
sincere
informed
nnd
tinuninformed viewpoints.
dustries.
Douglas
Aircraft,
the biased" individual
denies that inCan anyone doubt that the preslargest in its field, made 21.7%;
creaSed
wealth
can
onlv
come
ervation of our freedom is the
General Motors, the No. 1 autofrom increased nroduction Higher industry's greatest challenge? Can
mobile manufacturer, made 18.5% ;
alone
or

preser¬
vation of our

*

ob-

a government
savings
This is not a healthy situa-

in

indicate

be

whole

today

us

statistics

could

Another way in which the freedom of our industry could be lost
is by the inflation route. In this
we able to come
up to the average, area, while the steel industry has
However, lam wondering whether great responsibility, it is but one
this is the best
type of eompari- of the many important groups
son.
Averages do not teil the involved. Of course, all other in-

lenge." My
view

industry

a

than

in the last two years—extremely
good ones for the industry—were

Greatest Chal-

the

than

as

less

automotive, 28%

panies
cut
prices
by
lowering
profits" but only
14% checked
wittingly, advocating the nation- "Companies cut expansion
plans
alization of the industry.
I urge in half," apparently sensing little
those who desire to be
objective, relationship between profits and
and who prize our
freedoms, to growth.
Another disturbing sta-

facts.

counter-custom, if
custom, by stating at

be

ber of replies—37% of the total-r
steel.
Only '" 28% named,,

picked

earnings and steel prices as being
too
high are, knowingly or un-

dangerous lack of understanding of the

run

existing

method of accounting
if it existed at all,

For these

take

shall

integrated

with

tion, and is but one more added
proof of the inadequacy of - the
earnings of the industry.

demands; (2) economy's inability to check inflation may
prompt wage-price control which is another road to nationaliza¬
tion, and (3) inadequate communications with public and
true

proper

the

bond.

tion

I

and,

tained from

as

a

any

would

'

directed at the industry.

employee creates

completely

plant

prices, make a return which would
justify the investment. Indeed, by

President, Inland Steel Company
Three

a";

j

steel

17

Quarter Cen t

was

the

rinh*
rS-thaf
Club of
that

ur y

firm/ The organization consists of

partners
firm

and

with

twenty-five

employees
of

record

a

the

of

than

more

of service. Mr.

years

Holt is also the member?with the

longest record of service, which
goes back to 1909. Alfred-W. Haywood, the only honorary member

0f the club, attended.
After

dinner

j_

.

the

on

■

Starlight

Roof, induction of three new*mem¬
took place. They are Frank

bers

L. Parks and Howard* P. Keady
of New York and T. Haskell

tower

of

Jacksonville^

High-

Florida.

Fifty members, coming from the
numerous

t?hUe^nwaee3'
trols
wages, itfces^m-oducZ
prices, pioctuc
jf
ovei

tion, distribution etc. Such
ures,
throughout
history,

1S

T Y?ali tohUSt °fJanotherbleak, 'indeed,
mere

certainly far better than

ownershin

meas-

dollar comparisons
with earlier
have, .years when- volume was smaller
imperiled individual liberty. Free and the value of
money greater, a
speech, a free press, a free choice most deceptive method often used

of

occupation, religious freedom, by labor and political statisticians.

dom,6'wf "ir^'ericanf Sto ^
mTt dearly T wotS be endanIf this premise is

gered.

£?*£££
!=

of

is

tance

the

to the American

What

might
its

nrdl^nf
of

highest ordei
the

are

the

cause

freedom?

I

correct,

immir

impor-

doomed'
Darty

featist

mflat

to

I

noint

on

is

in

!

the

family

a

_

.

has

been

said

view

•

the

i

de-

Unbridled
man

not

be conouered bv

ail
^

First

we

to

think

of

sev-

Mr. Block before the
regional meeting of the American
Iron
and
Steel
Institute, Oct. 16. 1957.




of

the

firm

and the

freedom

a

way

0f

the

..

.

.

•

,

affiliated with
Dempsey-Tegeler & Co., 210 West
Seventh Street. He was formerly
Wagner

is

now

with J, Logan & Co.

■

,

.

-

dian

offices

augmented the

y°,k "embers and joined
festivities.

in
All

of

these

shares

appears

having
as

a

been

sold,

this

announcement

matter of record only.

.

i-

240,000 Shares

inflation

allowances to replace-

mPnt posts

'

...

It

is

prove

a

that

nf>:

simple
one

a

search

.

very

In

matter

today

to

could

Gf

jg

recent

survey,

Corporation
listed

industries

highest profits.

.

Opinion Reasked which
made

The largest

the

num-

in

Caro-

linas, from other offices in the
ANGELES, Calif.—Dane C. western states and from the Cana-

of

by

offices

Georgia

ployee and public relations. This
adequacy of the permissible de- is, of course, intimately related to
lose preciation allowances—the result
the other two.
We will have no

steel'industry, over'a^ong'period
address

Florida,

(Special to The Financial Chronicle)

LOS

can lose our industry's
is
bv
inadeauate
em-

_

cAn

Tegeler

."l

of the past two chance
of, making adequate profits
all, if we oid not decades—and I shall not belabor
to
assure
growth, no chance' of
continue to provide the steadily this
point tonight; Suffice to say halting inflation, unless the story
increasing
steel
production
re- that the steel
industry, for obvious is properly told and understood
quired by the American people,
reasons, must replace its equip- by all concerned.
'
.."
,•
there would quickly be a demand
ment at greater frequency and at
As an industry and as individfor publicly owned steel-producrelatively higher costs per sales ual companies,
we
have made
ing facilities. Can we provide our dollar than some of the other ingreat strides in recent years in
country with the steel it needs in dustries with which it is
compet- this important activity. But we
the future as we have in the past.
jng for investment dollars. Thus, have a very long way to go.
I
I
would
hopefully answer "yes
if |s af a further disadvantage
by have already referred to the prebut
would
be
forced
to
add
a
having to use a large part of its vailing
erroneous
opinion
that
qualifying clause such as "pro- retained
earnings for such pur- industry and labor are equally
vided we make an adequate reposes, rather than for expansion responsible for inflation.
Let me
turn so that we can attract capital and
improvements. I hope this give you two more examples of
needed
for^the gigantic expendi- situation will be remedied at the the inadequacies of our public
tures which will be required.
next
session
of
Congress,
and relations, examples which pertain
Are we in such a position?
I action will be taken to relate de- to the matters I have been dis¬
cussing.

eral.

With Dempsey

Poor Communications

'which

'

..

of

will not be

My final example of

Realistic Depreciation

Much

one

svstem

such'gloomy

creaturTof

and Can

God

'

„
,

of

private

our

"amIt

vital

of

for

any

St ^

relations"

*

a

knd

enterorise

which

industry

can

onh tWs ^ a,Uh,°Ugh

^

peop e.

factors

is

'

free

COMMON

STOCK

Offering Price: $1.25 Per Share

JAMES ANTHONY
MAC R0BBINS I CO., INC.

Securitfes CORP.
37
New

Wall

Street

York,

N.

Y.

26

Journal

Jersey

Square

City,

N.

J.

New

'

;

Financial Chronicle

The Commercial and
18

Thursday, November 14, 1957

...

(2118)

What About Railroads

Years?

In the Next Ten

FARtCY *
Association of American Railroads

By WILLIAM T.
Chairman of the Board,

Retiring railroad spokesman predicts great strides rather than
a decline for his industry in the next ten years, particularly in

There " is, 4 of/course, room for
then-deficit. in -mentis, - even at1 th'e^levek of the
ownership would re-> past 10 years, -.will? have to be improvement in the services ren>
dered by these-trains. There ;are
quire installation of an average of- squefezed-outt of i the j. net J income
engineering problems to be solved
at least 75,000 new cars in each of:the railroads.;r
-J
in the design of equipment- which
of the next five years. I "am glad ,>!; This net income,-in turn, pomes /
will be better adapted to shipper
to be able to report that in the outiof what is left from.;the;totalneeds ^without' at the same time
first two years of that period this Return on capital^after the;, pay■-

freight

and service, providing earn¬
improved. Mr. Faricy looks forward to rails being
allowed to: (1) offer complete service by utilizing various
means of carriage best suited to each portion of transportation
movement; (2) set rates reflecting inherent advantage of each
form of transportation, and (3) handle properly such prob¬
lems as swollen inflationary costs, subsidized competition, and
are

Ten

ago

years

of
cars,
over
and
retirements. If—and this is
ship

paratus for the conduct of still
more penetrating studies and re¬

only

had

we

which

search
range.

nowhere in all
the military

of
less¬

money

and

build

continue

to

on

cars

to

ment,in railroads reached
order/in , five years-at has been
4%; in one year'it; dropped

scale—

this

75,000 new ones each year —' as* 3^ v 4.
well as to keep on making the v. By prudent financial

4/2.%;

belowunder

4 .-/
manage-

of 4 those

'

.operating problems to
be solved, in order that we mayget the most and the best service
out "of the-. iniproved equipment
are

which the
fOr

designers have in store
/v.

US.

■'

are-rate

There

•

ened, or the
striking power
of its armed

dimin¬

forces

-

the

movement"

above times have prevailed'in. the coun-. empty.;There
a big try, has: the-return on net invest-

if—if the railroads are able to find

narrowly specialized
unduly the return
same " cars

so

increase

to

as

problems, look¬
in improvements in roadway / and, ment the railroads have succeeded
Philadelphia; our Association is to structures which are so essential in'reducing their fixed charges by ing toward a more realistic ad¬
justment
of
rates
to the require¬
be honored by the receipt of the to getting the fullest use out of more than $50 million a year in
Franklin Institute's much coveted the freight car fleet—most of-you 1956, as.compared, with 1947, but ments of commerce as well as the
Henderson Medal, as the citation will live to see elimination oMhe;everl with this substantial assist,, cost characteristics and the reve¬
nue necessities of the carriers, v4.
car shortages which have plagued
says, "In recognition of the many
they;-face grave ■ problems in-fi.But underlying all these prob¬
achievements of the Mechanical us—and you—in times of brisk pancing / the / improvements * in
lems—if
the. railroads are to go
business
ever
since the end of piant and equipment which must'
and Engineering Divisions in the
ahead and continue to meet the
World
War
II.
But
everything pe made.
many fields of railway engineer¬
needs of the nation as they should
ing." The citation goes on to say depends on earnings. And so I v
But
legt
j
soun(j
pessimistic
is
the
problem of the sub¬
that the research efforts of the come back to this vital question,.
(which.! am not)-, let me ask a
AAR have resulted in more de¬ Ten years aho. I said that.
The questjon: when have the railroads standard earnings which handicap
the railroads in their endeavors
pendable equipment and tremen¬ triple keys to the future of rail- « t f
a problems?
< to move ahead and to continue to
dous savings in the operation of roads as a business are earnings,.
meet the needs of the nation.
.
railroads, all of which are reflected investment, improvement. And the
ProWems Are Perennial
The
problem is one of costs
in greater
safety and reduced first of these is earnings — for

the world was

might

ever

an

,

becoming

Just six days from now,

ticed.

been said that

America

broadening
This advancement in rail¬
of

research is not going unno¬

road

has

it

car

goal of 75,000 cars per year will/ment of . iT^cessaryiJixed charges,
be achieved,
resulting in a net ?In-no one of the past 10 years, m
increase of 50,000 in total owner-, whichV for;' the
most part, good

unfair taxation.

recently completed the truly epic
rail transportation performance of
World War II — a performance of

,

the

overcome

vastly improved plant, capacity
ings

Basic

and Rails Are

Problems

classifi- ago a modest'.part of the sums
There are transportation
tasks
required could still be procured
I believe also that we shall see by. increased
withdrawals from in which other collateral and in¬
an improved freight car supply—
working capital.-Not any more, cidental factors cause the motor
truck to be preferred, but when it
improved not only in total number Working capital is now down to
of cars but in average quality and where - it must.- be conserved
in comes to the basic elements of
cost
in moviqfg the vast bulk of
in greater adaptability to special the cases of all but. a few of the
America's
commerce - {there f
is
purpose shipments. Two years ago, most prosperous railroads. -.With
in 1955, addressing this association 5 everythingcounted, ,.more
than *; nothing in' existence," and nothing
in sight, which can take the place
at
Pittsburgh, during a severe one-third of the ■: amount needed
car
shortage, I suggested that to to
finance continued improve- - of the train of cars on tracks. '/>

part, in major electronic
cation yards.

—

ished, by rea¬
son of anyfailure of rail

transportation
here at home.
We took pride
in the past,

.

William

T.

Faricy

we were more

concerned with

what lay ahead in

the future. Ten

but

1 .recall coming kom
fven*n^' a
rJari??n!fn
Without continued investment tough day and remarking to
there can be no great improvemy daughters,, who with h
ment in capacity or service. And'husband and three of hei
broader research is a certainty. so we come to the very heart of,dr®n»
™as, v\sS-JS?'
had ^r1 tmalEven though there may be no sin¬ the future of railroads as a busi- railroads
the improvement of earn- *acln£
them. Whereupon,
y
gle change yet on the horizon so
dramatic as the diesel revolution ings." That's what I said 10 years daughter smiled and said, Daddy,
in motive power, there will be a ago,
and I see no occasion to myearliest
recollections as
host of
little girl are of you^°^?£/kome
Jtess conspicuous develop¬ change a word of it today.
ments
plant and equipment JiAt that time iri^ 1947*Hhe rail- trom the offme andL^ saying that
%'
nnn
the railroads face a time, of crisis
which, in total, will have a pro¬ loads
employed ,1,350,000
men,.

transportation

without

American

of

charges for the
public.
That there will be great changes
in the physical plant and equip¬
ment of railroads as a result of

of what was then the future
in the past. These years
have seen the virtual completion

years
are

now

of the diesel revolution in railroad

only in its
early stages. They have seen the
spread of centralized traffic con¬
trol, the introduction* of automatic
"push-button" freight,! yards, the
wide adoption of the principle and
practice of transporting trucks and found effect upon the art and
trailers on flat cars.
In fact, so practice of railroading.
Equally important changes are
rapid was the growth of this last
named operation that it outran the in prospect in the methods of per¬
English language, and a new use forming trapsportation service, if
motive

for

an

then

power,

the railroads

old term had to be found to

describe

it—"piggybacking." Thus,
railroading continues to enrich our
language as it develops our serv¬
ice—railroading which has a dis¬
tinct jargon of its own—making it
at once the despair of the rheto¬
ricians and the paradise of the

neologists.
.

$12 Billion in Ten Y'ears
In the decade just
have

billion for

past, the rail¬
than $8
22,000 new loco¬

spent
over

motive units

freight

it difficult to offer to the public a

complete service by using the var¬
ious means of carriage best suited
to

each

portion of the movement.
it may be anticipated also

And

that rate-making rules will be so
relaxed in the future

*

roads

relieved of some

are

of the limitations which now make

cars.

more

and for

In the

638,000 new

same years

the

have spent more than
billion for improvements in
fixed plant—for better tracks and
bridges, yards and terminals, sig¬
nals and shops, and a host of other
new and improved elements in the
roadway and structures which are

to make it

as

possible for each form of trans¬
portation to give the public the
full benefit of its inherent advan¬

be in

tages, whatever they may
any particular instance.
In most cases,

the advantage of

the railroads is in cost,

is indi¬

as

railroads

cated by the fact that they haul a

$3V2

ton of freight one mile for an av¬

the

at

foundation

business.

The

of

the

railroad

railroads

have, in
sum, spent in the past ten years
just under $12 billion—an average
expenditure of almost $1.2 billion
year—to help build

better
railroads which are necessary to
meet your needs in transportation.
At the same time, they have
stepped up their programs of re¬
search. Ten years ago. the Asso¬
a

the

erage

cents

of

revenue

haulage

aver¬

an

of

cents

6

by common
reporting

■

trucks

motor

IV2

than

less

compared with

as

ton-mile

age

for

revenue

carrier
to the

Interstate Commerce Commission.
This four-to-one difference in
erage

does

revenue

course,

that

rail

not

rates

mean,

dication
level

of

it do^s give
the

trains of

on

cars

each with its

in¬

diffVynnce in the
goods in

tracks and

ing them in separate unit
own

ness

asn

research laboratory.

Today, the

AAR's railroad research center

on

the campus of the Illinois Institute
of Technology here in Chicago in¬

cludes

three

modern

and

well-

equipped buildings, all completely
devoted to railroad research.
are

under way looking to

ercise
on

a

of

site

the

Association's

for

still

a

Steps

the

ex¬

option

fourth—and

doubtless there will be yet other

buildings with their scientific
*An

address

completing
the

his

Association,

ap¬

by Mr. Faricy, who is
tenth and Ia«t year with
bef-re

of
Shopners Advisory^ Boards
Digitized•nd
for FRASER
the Traffic
Club of Chicago, Oct.
http://fraser.stlouisfed.org/
10, 1957.
Federal Reserve Bank of St. Louis
sociation

you've been saying it ever

__and

who

worked

hours for

a

an

average

of 2,672

-•

.

,

.

problems ar
life of Ameiithe same volume of
railroads wei e
with only 1,042,000 men, a reduc- horn ot the problem of finding
tion
of
over
22%.
These
men
some way to provide cheap and
worked
average of 2,365 hours: dependable
all-year, tianspo t each, a reduction of 11.5%. But-,tion for the interior of this va t
the total payroll had gone up to ar}d richly productive continent,
$5,325
million,
an
increase
of * whose resources then lay fallow
22.5%. And along with this in- for lack of such outlets,
in truth,
nothing new m the
freight traffic pan railroads. The

railand
and
largest item in the cost of oper- determination. And they had need
ating a railroad.
- of
all these qualities of strength
But, fortunately for the rail- to carry out the tasks they had
roads and the shippers alike, the-se* for themselves of pushing out
same
10 years which saw these those thin lines, first of irop and
increases in the major items of then of steel, which made poss b
railway operating costs, saw the -the free flow and mterchange^of
investment of nearly $1,200 mil- products upon which the economy
lion
a
year
in
improvement
^ls £reat nation is built,
projects
which
have
paid
off
" With the coming of other forms
handsomely in better service and of transportation, there is a dis-

crease

in payroll

had

gone

The men who built these
roads were men of faith
vision,
of resourcefulness

com-

parable increases in the prices of
materials and supplies—the next

position on the - part of the uninformed to feel that the day of
have withstood the lapping tidesvthq railroads .may be drawing to
of inflation without the improved-'a close. Nothing could be farther
facilities which this capital invest- from the truth—as you can see
ment provided.
" by looking, with a discerning eye,

reduced
very

costs.

Indeed,

I

doubt

This rate of investment must

train you see
:g°iriSkby. A .freight train is sue
sight that .most of us
to •.-fail to>* see what a
remarkable vehicle it -really is
a vehicle made .up of.as, many as

be^t- ;the ,nex^

continued

and—if the money can
be found—should be stepped up,' a,.familiar
both on account of the increasing >are idtelv
of

of

of

the

railroads

inflation

making

upon

and

the

the cost

a

improvements.

hundred, or more separate units,

loaded

at

different

origins,

con-

to different destinations
I am confident that, the next ten
Two vears a20
at Pittsburgh
flail-assembled for mass movement
vi
^2
years
ago,
at
Pittsburgh,-1.with
maximum
economy in the
years will see, either through ad¬ undertook to discuss the prospects.
islative

The

leg¬

clarification, elastioitv in

the making of rates, provided

Outlook Two Y'ears

for

Ago

financing such a continuing
Depreciation and retirecharges won't do half the
job since we are replacing. cars
which cost $2,500 each, and have
been
depreciated on that basis,

program.

railroads

the

solvent.

.

is

It

to

were

problem

a

remain

of

rate

rigidity, due to the complications
and difficulties in making prompt

to

adjustments
is

It

changing

meet

situations..

-

•

'

,

—

.

«

problem of taxation—a

a

problem which is not exclusive to
the

railroads, by any means, but

to which they are peculiarly
susceptible by reason of the fact
that they own and maintain their
basic transportation facilities and
not

merely the vehicles which op¬

erate

signed

f manpower,
and

in the consump-

^ L lii
in money
tlon ot ±ue1' anafn.I?, f

cost,
.

them.

over

And it is

tion,

problem of competi¬

a

which

of

some

directly

is

subsidized and most of which has
the use, either free or

at noncom¬

pensatory charges, of expensive
facilities provided and maintained

by the public treasury.
Shippers' Relationship

which

I

depend

the

to

solutions

The

-

road

will
resourcefulness

the

upon

men

problems

touched

have

who,

now

upon

of the rail¬

and the determination

and in the fu¬

them in the first

ture, must face

instance. But in the solutions

too, will have

pers,

tell

can

us

wherein

ship¬

part.

a
we

They

succeed

in

meeting your needs,, and wherein
fail. They can suggest to us—

we

.

much that the railroads could

effect

or

if

an

needs

ministrative determination

inflation and not fully
by rate increases. It is a
problem of rate adjustments dis¬
turbed by the necessity for seek¬
ing general horizontal increases
covered

one

*

later, in 1956,
the railroads hauled substantially

mov¬

Next Ten Years

swollen by

cinn#3, »

total of $4,350 million

in wages. Ten years

ciation of American Railroads had
no

—

vehicles,

driver.

_

one

_

the

on

some

of moving

of costs

of

that

are

much less than truck rates
average, but

av¬

earnings, or the prospect

earnings, investment languishes.

as

often done in the past—how

so

improve our ways of do¬
ing business, to make our services

we

may

attractive to the

more

For
sense,

production

of

the

service for which
tomers.
far

as

ness

users.

.

they are, in a verv real
our partners in the efficient

Such

a

I know,

transportation

you are

our cus¬

relationship is, so

unique in the busi¬
is a relationship

It

world.

which has prevailed for more than
a

third of

the

a

century, counting from
of the Advisory

begin nines

It has prevailed

Board movement.

through

throueh
age,
war

in

boom
car

and

depression,
car short¬

surplus and

peace

and in the

tlm wo^d has

greatest

ever seen.

It is

The average freight train
a
relatione^*n which has proved
.coun^n^ way freig^hts antf move- its workability and its helpfulness
in which iq noncompensatory. or
ments which are, in effect, travel- —and one for w^ich we of the
which
discriminates
against
or
switch engines, as well as the railroads are profoundly grateful.
prefers anv shjnnor. anv com mod- with cars which cost
$8,500 apiece, mile-long through freights —- the
To my successor, Dan Loomis, I
itv. anv comrnnnitv or anv region. Two
years ago, some funds could average freight train carries 1,400
predict that during his vears of
In the next 10 vears. T believe be realized from an increase in tons of lading. To rnove the same
wrestling with car supnlv and car
that we qhpn ceo 'h«++er tUvmirfV>_ the amount of equipment obliga- tonnage by motor vehicle, at av^"
service problems. he will have no
scheduling of freight service, with tinps nntstanding. Some can still aSe loadings, would require 140 more undnr°tandincr fronds than
Ipcq
tir*->e
cnant
in
in+err^edii+e be raised that way, but it is be- trucks
and at least that many von men of the Shippers Advisory
yards and with necessarv classifi¬ coming increasinglv difficult and ^drivers — as against the treignt Boards. 1 > ' • -'
cations performed, for the most increasingly expensive. Two years train crew, usually, of five men.

ways

that

no

rate

shall

be

al¬
put

ment

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

2,464,000

Morgan Stanley Group

first

a

-

-

day

for ..the

year

months of 1957, com¬
with 2,449,000 for the full
19561 '

Operations
of
the
company's
subsidiaries, as well as those com¬
panies in which it has substantial

Oil Co. (N.J.) Offer
Standard Oil Co. (New Jersey)
offering to the holders of its
capital stock the right to subscribe
,

investments,

widely distrib¬
uted
geographically throughout
the world. Sixty-nine per cent of

is

at $44 per share for 6,549,124 addi¬
shares at the rate of one

consolidated

tional
share

for

record

each

30

shares

Nov. 8,

on

1957.

held

Dec.

of

(EST)

mailing

Dec.

on

of

the

18, 1957.

warrants

Africa

The

to

nationwide

ing
group
Stanley &

the

ern

by

$803,535,000,

Morgan

offering

the

and

company

purchase

the

the

from

United

and

Europe, North

Of

1956

33%

and

Far

in the East¬

areas

consolidated

derived

was

in

the

Canada,

United

Employees

&

Company,

Inc.,
sugar brokers with headquarters
at 99 Wall Street, New York City,
honored eleven members of their

organization
completed
service

who

have

this

Those

honored

Nov.

were

Grote, Edward H. Lopez-Miranda,
feld,
York

&

Mr.

Novotny, Samuel SchoenA.

With Mitchum, Jones

Donald

Orleans

D.

Cole,

ANGELES, Calif .—Barbara
has joined the staff of
Mitchum, Jones & Templeton, 650
South Spring Street, members of
Hunt

from

from

the

Hemisphere.

Graves, of the
Louis

J.

Detroit

Jacques, of the Chicago

office; Samuel R. Kweskin, of the

Richards

W.

ST.

Hue

is

now

with

East

Fifth

dustrial

than

more

stockholders

DETROIT, Mich.—John E. Saari

Smith, La
& Co., Pioneer Building.

has

become

affiliated

in

the

United States.
The 'latest

previous

financing

undertaken by Standard Oil (N.J.)

by public sale of securities
when

194.9

the

was

international

in
oil

raised $150,000,0000 through
offering of 25-year 2%% de¬

firm
an

bentures due July
Net

proceeds

15, 1974.

from

the

current

offering of additional shares will

replenish the company's working
capital and will be available for
investment
filiated

penditure
The

-

in subsidiary

companies

connection

with

and

af¬

primarily

their

in

capital

ex¬

programs.

worldwide

growth

of

the

Company and its subsidiaries since
the end of World

;<

War

II, in

com-

'mon with the petroleum industry
3 in
general, has required large ex¬

penditures to develop producing
capacity and to provide transpor»tation, refining and marketing fa-

abilities.

In

addition,

volumes have

sales

expanded

substantially

increased the amount of working

capital required.

In the five years ended Dec. 31,
3956, gross additions to the plant

*

1

facilities

of

the

company's

sub¬

sidiaries totaled $3,330,000,000 and
also within this period there was

spent in the search for oil and gas
not capitalized amounting to
$844,000,000.
The total of these
outlays,
$4,174,000,000, exceeded
amounts changed to income for
sums

depreciation and exploration dur¬
ing the period by $1,743,000,000.
Outlays for facilities and expenditures in the search for-oil will be

*

about

of the
:

in

$1,400,000,000
1957 and

•year

same

the

For the nine months ended

30,

Jersey

1957,

total

mated

dividends
;,tofor

full

esti¬

Standard's

revenues

from

interest

and

Sept.

-

ponding period of 1956. Estimated
profits for the nine months were
at a peak $66*0,000,000, equal to
$3.35 per share, compared with

i

on

the stock

were

55

share in each of the first
quarters. A fourth quarter
dividend of 60 cents was declared

mas

been studied by

payable to stockholders
This dividend,
which will not be paid on the new
Oct. 31,

record

stock,
to

Nov. 8.

brings

total

the

$2.25, compared

for

just spic-'n'-span "Christ¬

ades and declared

efficient oil conservation methods,

a

poor

prospect for

oil. Unconvinced, Richfield geolo¬

gists went
.

over

the ground again and

injection,

recovery

for

assure

The Far West—where the

years

gas

brought in. A

later Richfield discovered the

ley totaled

over

petroleum

and

to come. By

tion of crude oil from Cuyama Val¬

was

Richfield stands for

the best in

profitable oil

producing well

120 million barrels.

Today, in keeping with its policy

South Cuyama Field five miles away.

Together the Cuyama Valley fields

1957

water

August 1, 1957 Richfield's produc¬

year

with $2.10 in

including repressurizationby

again. Finally in June, 1948 the first

•

.

trees", pumping units and

geologists for dec¬

cents per

of

this very modern

low-lying tank farms. The latest in

,

three

on

mar

had

Semi-arid Cuyama Valley

period in 1956.
Dividends

oil field...

name

year,

*

a

major oil producer.

$5,375,000,000 in the corres-

$603,000,000 or $3.07 per share last
although profits for the third
•quarter of 1957 were somewhat
lower than for
the comparable

No derricks

oil in California's

Cuyama Valley made Richfield

$6,041,000,000, a record figure
any similar period, compared

with

;

The discovery of

sales,

amounted

v

■

Cuya ITIGU • • biggest California oil strike in 20 years

expected to be

are

order in 1958.

of

years-ahead planning, Richfield

represent the biggest California oil

is helping to

strike in 20 years.

in many parts

develop

new

oil

reserves

1956.

Net

crude. oil

cluding
was

production,

condensates,

in¬

worldwide,

of the world.

.

estimated at 2,172,000 barrels -

nine

months,

compared with 2,056,000

barrels-

daily

in

the

first

,a-day for the full

year

1956. Crude

Digitized
oil for FRASER
to refineries averaged

runs

IRICHFIELD a
/oil

corporation

with

Arm¬

strong, Jones, Lawson & Shite,
Incorporated, Penobscot Building.

offering to

made

ever

to

Armstrong, Jones

$288,000,000
largest in¬

stock

common

added

Stromer, 426

Street.

The sale of the additional shares

represents the second

Calif.—Charles
been

the staff of Jensen &

'shares.

involving

with

(Special to The Financial Chronicle)

PAUL, Minn. —Richard F.

McKown

has

unsubscribed

any.

Boulevard.

(Special to The Financial Chronicle)

With Smithy La Hue

office;

Wilshire
was

MARYSVILLE,

With

of

office; James F.

(Special to The Financial Chronicle)

45%

6505

Gould

With Jensen & Stromer

(Special to The Financial Chronicle)

the New York and Pacific Coast
F. Schwenker, and
Stock Exchanges.
Wheatley, of the New-

office;

the New

Co.,

previously
Shelley, Roberts & Co.

August

Walter

become connected with M. J. Ross

Club.

H.

ANGELES, Calif.—Stanley

J. Gould and Sam Nathanson have

LOS

Arthur

E.

mem¬

(Special to The Financial Chronicle)

LOS

bers of the Lamborn Silver Lamb

year

11.

was

silver bowl and will become

twenty-five years of
the Company, at a

dinner-dance held

Bert J.

zation

organi¬
presented with a large

10

Two With M. J. Ross
•

members of the Lamborn

with

amounting to

Latin America and 22%
Eastern

at

Lamborn

.

Middle

operations

States

Co.

composed of 311
investment firms will underwrite

the

and

Hemisphere.

from

in

assets

25-Yr.

Canada; 18% in Latin

net income for

underwrit¬

headed

was

East and other

422,000 shareholders
.will be completed by Nov. 18.

ift.A

book

America and 13% in

than

.more

net

1956,

States and

The sub¬

scription offer will expire at 3:30
p.m.

31,

are

Saginaw office;
and Emma B.
Wernicke, of the Savannah office.
At the dinner, each of these

Lamborn Honors

nine

pared

Underwrites Standard

barrels

(2119)

leader in Western Petroleum Progress
v

The Commercial and Financial Chronicle

I

(2120)

20

credit.

becomes

Capital and Term Financing
By WALLACE M.

the

Vice-President, Association of Reserve

steps,

most to

funds to meet the demand for

personal loans. Mr. Davis states

the future outlook is for

area

greater needs by loan

problems these days
to businesses of ail

common

are

Purchasers

Make the Banker Interested
I

summarize

to

what

I

saying in this way: the
is doing its ut¬

bring about the stabiliza¬

prices. Bankers work in an
where they have the op¬

to do likewise will bring

we

our

^

but if

you are

panies,

benevolent

to do the sort of

trusts,

have

job for which you
capacity, the facilities
demand, then you cannot

associations,

funds,
and pension
interest rates,
con¬

and

the

sidering the time of sale, vary
slightly from bank rates, plus the
afford to take a chance on my value of reciprocal deposits.
The
being right! I want to let you in funds of such purchasers are seek¬
on a secret concerning lenders, if
ing longer term employment and
by chance you don't already know. by their use to the proper degree,
A hungry lender is a friendlier the
finance company obtains
lender—make him want your busi- longer term funds, fortifying at
and the

life insurance, pen-

of our country and its citizens, and sj0ns and annuities.
many
within our own bordersr
' *■

wrong,

educational

must not make suckers out of

through

might be

of these debentures

have largely been insurance com¬

hemmed in with inadequate funds

savers—and most of us are savers,
-

,

.

k

justifiable costs in our operations;

the
.

our

,

misery instead of bounty, will severely tax our capacity to provide
adequate capital for our respective
enterprises, and will impose un¬

debenture route.
Most of

you? Yes, that is possible, but I simply more funds with which to
\
"
think highly improbable. I ,was: work.
invited to say what I think—and
Purchases of Debentures
that is what I think.

to be in

as

Reserve

economy

companies

of financing through

prevalent

portunity to aid in that objective.
to do our part and the
failure of other segments of our

capital or long-term funds. Declares a finance company
perpetual line of credit has no place in a bank. Explains what
even
small-medium companies can do to obtain long-term
the advantages

the

Failure

for

and

to

tion of

Board's anti-inflation
and examines finance companies' problem of securing

borrowing,

want

Federal

vigorously defends, and suggests all lend¬

even

so

have been

City Bankers

with, Federal Reserve

cooperate

get

joke books, then it is time to

I

Orleans, La.

President, New Orleans Chamber of Commerce

New Orleans banker

people

slow down and think!

DAVIS*

President, Ilibernia National Bank, New

When

point of ignoring over-all obligations and think only in terms of
"how much a month", and that

Consumei Finance Company

ers

Thursday, November 14, 1957

...

i

•'
'.:,/«■»

time its bank lines!

&ive him reasons for
wanting it. Seriously, a finance

the

company

financing can or should be em¬
ployed will be governed by the
earnings record, for the lender of
term money will look to the bor¬

ness .and.
in

line

less
in

desirable

was

in

use

than

which is
place in

no

ten months is
one which
is

six months—that statement

use

was

of credit

perpetually has

use

the bank; one

true in times when money
plentiful and loans in demand,

and even truer today. No type of

same

The amount to which debenture

rower's ability to repay serial
stallments and interest with

a

in¬
safe

margin, but balance sheet propor¬
tions will govern the prospects
and amount of such financing with

know only too well that debt itselfWorking Funds
..
borrower has been more welcome
can be
destructive and we are/'- 0n my second point: while ni&fa is in better grace today than equal weight.
ing cost of living, so-called "tight" greatly concerned about it.
one
can
accUrately predict the the finance company. On the other
Small Finance Companies
money and increased costs of borj would like to deal with two capital needs of the consumer fi- hand, no other type of borrower
rowed money. In a very striking
phases of the general subject in nance business, the small operator has depended as substantially on
Large consumer finance com¬
way, our country has enjoyed a {his order:
will assume that the requirements short term bank credit as the fi- panies have had no serious prob¬
kinds, and to people in all walks
of life—rising prices and the ris-

has

experienced

d).

relative

peace,

piloy^LrWttZlfbela^tagX
If

capital or long term funds with nance

company—and to those who

...

..

the

in-

fact has arisen to haunt

the

cti°/a J"

flation is brought under control.

I have probably belabored this

r|duct^
that

belief that long term

gnd
gradually ifincrease.
Thatof will them.
now that
be true
the threat
even

Reaction to Money Volume
Studies of the trends in population phase of the subject unnecessarily,
misfortune —a filing that pros°ur total money supply is and its composition will support but if I have, it is to lead into or
perity isn't quite as pleasant and closely regulated by our central such a <conviction. If a
Point up a
secure as it should
be and doubt
banking system. The regulation of ir) personal income taxes takes borrowing should become a more
even grave concern
over the fuit is being accepted under-stand- P]ac? in
we may assume
important part of the average
ture
narticulirlv
on
the
short- ingly by some, begrudgingly by the increased take-home pay will company s program.
The very
term outlook
some, and with violent reactions he reflected in consumer debt. The characteristics
of your employMost of our economists,
economists
busi
is unfortunate that estimate
of! $1.60 of new
ment of funds,
busi- by others- 11
known ab0ut money
€acb added dollar available lor ency of so many on bank lines

Jfirrinto

.

....

the^ong^oo^ahMcf

high hopes in
nredict

and

standards

Those

of

money

healthier

than

climates

can

with

some

time

same

of

of

those

nroenostications

probably supply
At the

known

lenders

are

along

go

enthusiastic

business

have

we

who

us

living

Meher

even

and

and

our own

should know

we

people

how il is created and what curious
tricks it can play in our lives. But
H is more unfortunate that even
many who should know deride the
regulations or controls of pur
monetary authorities, and through
their attacks on the Federal Reserve and their own unsolicited
opinions, mislead and confuse

that

national exuberance there

t*

u*

*¥

rr

Debt Has Two

ip

he Obscured
sure.

—. _

Sides

by

other, more

It is unfortunate that we don't of thinking,
Raising the Capital
20/20 foresight—had more
finance companies foreseen a peWhat sort of policy should be
riod of "tight" money and higher adopted and where can money to
rates, they would have raised work with be found? With the
mbre capital in the equity,-markets
or would have arranged for. more equity market limited to the very
debenture financing in anticipa- few and competition for investtion of the present situation and ment dollars so keen, the sale of
the reasonable outlook. Some com- additional capital today is expanies did do that and now point tremely difficult, if not imposwith great comfort and satisfac- sible. Furthermore, many comtion to their very comfortable panies are owned by families or
balance sheet positions and their groups who are reluctant to sell
average low cost of funds.
vstock—not wanting to share ownFor those who didn't do this, or £'rsbiP or dilute their capital inwko must still look for ways of terests.
The more popular and
providing funds, it is not too late possible source of *unds has peen
[0 make plans.
in the lssuance and placement ot

possess

are

dra-

matic headlines, were the cost of
'
living figures released the latter
Finance Companies' Record
look at it from our
part of September. Those figures
i should have no hesitancy in
hand the most useful instrument should give us all pause and talking with you about bank lines
for good, and, at the same time, should bring more supporters be- 0f credit and yet I do, for fear of
a
most dangerous
instrument if hind a strong and determined ef- being misunderstood.
You must
improperly used. This country fort to stabilize the cost of. living.. not misconstrue what I am about
would never, could never, have The Federal Reserve in effect and to say, for no one has more respect
achieved its predominance in pro- in its considered judgment is say- - for "many of you than I, and your
duction and world trade had it not* ing several things to us: (1) the, industry is a very essential part of»
been .for the
highly developed gap between savings and invest- our credit system
I have already
distribution
and
credit
systems ment is too great, the country must indicated that. "At the same time,
which we enjoy.
The kings of slow down its rate of investment I can look back to World War I
ancient, medieval or modern times, or increase its rate of savings; (2)/ wheri' the ^finance company acwith wealth and servants beyond that gap must not be filled by in- count and line was accepted with
description, could not claim the creasing debt, or to put it another many reservations by most banks,
comforts and conveniences of the way, debt should be limited to yet with fine cooperation and in~.
man-on-the street in the United those things which will in turn telligent assistance on the part of
States.
Mr. Ordinary Citizen can result in savings or added produc- certain large banks and commerown his own home, which he pays
tivity; (3) creeping inflation is ciai paper dealers, standards of
for like rent; his meat, vegetables neither necessary nor desirable; (4) borrowing and reporting were deand fruit come from
the
deep the democratic way for the finan- vised and credit lines became more
freeze—he bathes under a pat- cial segment to operate is with readily
available.
Through the
ented shower,
is kept warm or selectiveness and restraint. .For eariy 30's, the finance companies
cool by year round air condition- one, I prefer to operate under the gave a splendid account of theming; he propels his own boat to his present quantitative controls and selves, and with only minor and
favorite fishing place by an out- these implied admonitions.
unusual exceptions, have done so
board motor or entertains himself
The present situation with its to this day.
and his family and friends with alarming rise in the cost of living
Following the banking holiday
We

should

know,

others, that debt,

better than
credit, if we
seats, is on one

or

debentures — term obligations
which are accompanied by protective convenants for the pur-

chaser through related agreements,
These debentures are to be found
in several forms: long-term sub-

ordinated notes; junior subordinated notes and so-called senior
long term obligations. Of these,
the first two have the aspects of
capital inasmuch as their claim on
the assets of the issuing company
is'limited by the related agreementor indenture. The first, the
long term subordinated note is
usually subordinate to debits in
the current classification and the
-second, the junior subordinated
note, subordinate to the long term
subordinated note in addition to
debts in the current classification,
The long term obligations are, as
the description implies, long in
term, but in default they share on
an

funds through
either in

obtaining
of

sale

debentures,

market

open

in

or

private

placement with large insurance
companies—they have had to pay
the going rate and agree to noncallable features, but these borrow¬
ers occupy a unique position because
of their size and diversity. In time,

debt for
the utter dependdebt service is not an exaggeration, would seem to support this sort

others.
0ur Federal Reserve System is
some forces which if left unchecked
very conscientiously trying to help
or if disregarded
can destroy all everyone, for certainly everyone
of us, from what seems to be such will eventually suffer if inflation
a
dynamic position
we
would is not controlled — the fact that
have
what
Mr.
Humphrey de- other segments of our economy do
scribed
as
a
condition
which n°t exercise the same restraints is
"would curl our hair."
a matter for their consciences, to
than most

better

our

in

lems

need of additional credit

which to work will continue high are in

(2).
v /
Our source of working

oeiaoonng me

whuoui

piuymein.

The supply of money gen- for

erajjy

equal footing with current

they

resort to the national
equity capital to fur¬
borrowing base

can

markets for

ther increase their

if needed. Not so with the medium

small

and

companies,

number

great

funds

tained

'though

a

of these have ob¬
at relatively little

placement cost and at reasonable
rates, particularly by the employ¬
ment of a broker, who, for a fee,
will seek out a lender and handle

negotiations for the borrower.

the

there

If

manage¬

company

are

puzzled over
in which such money

ments who are at all
the manner

secured, from whom, and

be

can

whom,

through

been

detailed

more

quite

am

sure

through

will

negotiations

similar
their

I

have

who

others

share

experiences.

type of information required
support an application, and the
in which it is presented

The
to

manner

thoroughly justifies the employ¬
ment of experienced outside help,
I

can

assure you.

There is no easy source

of

lenders

The

term

of funds.

-money,

they are, are being very

wherever

selective, and there is no evidence
of those wanting to buy deben¬
tures—it is

a

a

buyers' market, and

continue to be so for

I think will

or more to come.
There
number of smaller insurance

year

are

a

companies and benevolent or edu¬
cational funds which can be in¬
terested in the type
we

of investment

talking about, however.

are

Advantage of Debentures
As

the income advantage of

to

through the debenture

financing

there can be no question.
Those who have used this device
route,

complained

have

may

over

the

initial

cost and interest rate—but

when

measured by increased in¬

come

equity interest, by the
furnished the

to the

leverage

added

creditors.

common stock, the cost is not high.
It is logical that bank and seIf "misery loves company", you
curity analysts should treat the
might be consoled to remember
subordinated debt practically as
that the banking business is very
and |n the period of great expan- they would a preferred stock—or
much in the same position as many
sion 0f our m0ney supply, finance at least as a part of the "capital"
companies in the consumer fi¬
company
lines were, easily ar- picture, thus broadening the bornance field.
Our source of funds
ranged;
now
the situation has rowing base.
The senior debt, to work with is deposits, which in
changed and lines are not easily however, must be included at its
these days are turning very rap¬
avaiiable.
Does this mean that face in the net worth to debit
idly with excess funds being si¬
when money is "easy" you folks ratio, regardless of maturity. Its
phoned off by the many attractions
are to be comfortable, and when great value is, of course, in the
in the open market. While every
money is in greater demand, you maturity
feature, for assuming resource of every bank is being
are to be restricted, regardless of
earnings are sufficient to meet
devoted to maintenance of funds
your soundness or net worth posi- serial payments, the money derto work with, a saying of one of
1 •
1
-ti 1!
~ J. —.
• _ •»
e
u
AU1!
tion or legitimate demands for vied from such obligations only
of the my former associates is apropos—
credit. I think it does. Isn't it pds- anticipates the building
"you have to run like the dickens
.

best

the

in

entertainment

in

the

living room; he moves himself and
his family rapidly and comfortably by the automobile and sleeps
under

the warmth

blanket.
of

no

of

electric

an

His financial statement is

and he only
nominal
salary, but

consequence,

receives

a

through

our

credit

system,

should make all lenders of money

interested in helping people
curtail debts and increase savings
than in encouraging them to

more

borrow.
There is no time, in my

firmopin-

ion, to do business or meet competition by easing terms; to the con-

he trary, it is a good time to practice
moderation, be willing to make

lives better than the Kings! Grant-

ing that, however, there are many
-Pavai
t*tV»
tirWli
foreigners who view with

grave

concern

triottr

a

/ym

r\

astute

adjustments and temporarily comCAvnA Vinnnc Or\rl rvl ono
TV*
promise some hopes and plans. In

rmntY* lea

t structure that I
the debt

am

not advocating a liquida-

^

tion program, nor do I believe in sible that in the next year, or two, company's own capital funds. The
43rd aSSTCwentfJ Ttbe ffltiomd shrinking from competition, but I
or three, that the situation will choice in the use, therefore, is de
Consuiner Finance Association, New Orsee no reason for meeting tougher change, and that short term money termined more by need of a capiieans, La., Oct. 17, 1957.
competition by giving easier will be more readily available to tal base and working funds or

*a

jj

t

w

p»

•

u

t

*1,

to stand

This
in

/in

still."

is

a

mnro

good time, .however,

tVian

wnrk

nnri

"wish"

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

(2121)
It is

a

good time to improve opera¬

issues, be it private loans.

within

revolves around money.

tions
what

the" framework

have.

you

Several

'

of

finance

people hare very proudly pointed
to currently greater
profits with
increase

no

in

higher cost
That

volume

of

borrowed

to

seems

to

me

be

a

between

the

It all

Close co¬
various

members of this emerging com¬
munity will be required to make

money.

it work in the constantly changing
economic fabric of this 20th Cen¬

worth¬

tury."

despite

—

operation

Blylh Group Offers
Caterpillar Tractor

expected

Blyth

&

Co.,

Inc.

headed

cept
a

group of investent bankers which

offered

record

losses, liquidity and

on

earnings,

have progressed

you

the direction of

more

in

with

money

which to work.

publicly yesterday (Nov.
13) a new issue of $65,000,000 of
Caterpillar Tractor Co. 4J/>% sink¬
BEVERLY HILLS, Cal.— ing fund debentures, due Nov.
1,
Bernard E. Mervel is now affili¬ 1977, at 99.50% and accrued in¬
ated with Daniel D. Weston & Co., terest, to yield about 4.54%
to
maturity.
Inc., 9235 Wilshire Boulevard.
(Special to The Financial Chronicle)

Economic

Impact
of "Mega-OpoJis"

H.

Eugene

economic

Dickhuth
of

impact

indicates

steadily
rising population in the United
States, creating a "mega-opolis"
a

(Special to The Financial Chronicle)

LA

JOLLA, Calif. —Homer L.

Chattin has been added to the staff
of Lofft &
nue.

He

Co., 7825 Ivanhoe Ave¬
was
previously with

Daniel Reeves

&

Co.

for

present

funds

provided

borrowing, will

bank loans,-

•

by

come

-1

Caterpillar, with headquarters
Peoria, 111., is a major manu¬
facturer
of
earthmoving equip¬
ment and machinery. Such
prod¬

in

the

over

the

for

deben¬

5-year period

no

premium

principal, amount.

sinking fund provides for

The

annual

.

ucts account for

There
in

over

redemption at

90% of sales.

are

capital expenditures Another factory is planned in
working capital; the bal¬ Brazil.
.
,
provide additional
The debentures are not redeem¬
working capital. The company's
able prior to Nov. 1, 1967 other
1957-59 capital expenditure
pro¬
gram, of which about $37,200,000
than for the sinking fund as a

par

before Oct. 31,

this

beginning

on or

1962.

'

Net sales of Caterpillar Tractor
in

the

31,

incurred for
ance

called

105%

which there will be

in

mestic plants are now under con¬
struction as is one in Scotland.

and

at

thereafter until Nov.
1,1975, after

apply

will

start

beginning Nov. 1,.1957 and decline

from

the net proceds to the
repayment
of $22,550,000 of short-term debt

Tractor

refunding operation

any

redemption

prices
tures

•

-

.

of

which borrows
money at a rate
lower than that borne
by the cur¬
rent issue.
Optional

the

presently seven plants
country and one each in
England and Australia. Two do¬

Caterpillar

Lofft Adds to Staff

part

approximately
three-year
$80,000,000 will
the

from internal sources and it
is anticipated that the
balance, ex¬

this: if

With Daniel D. Weston

total

come

Debentures at 991/2%

while

goal. You may be sure of
through the period we are
passing you do no more than build
up a good record—even a better

to

$215,000,000.
In
period, about

21

eight

1957

pared

with

income

in

the

Aug.
com¬

for

1956 and $533,038,000 in

year

Net

ended

$483,783,000,

$685,000,000

for

will

months

were

three

the

19551

periods

'

was

$35,217,000,

$55,404,000

$35,953,000, respectively.

and

' -

stretching from Me. to Va.
"Danbury, Bethel, New

„

and

hundreds

ties

will

urban

of

other

become

and

Haven

part

of

suburban

■

■

.

a.:,

*

'••m

i

t-.1

the

part

United

States

which

extend

may

from Portland,

Maine,

to

say

Richmond,
V i rg

in i

within
f

a,

the

reseeable

o

future":

H.

Eugene

Dick¬

huth,:

Vice-

President

of

American
H.

Trus t'C o.,

Eugene Dickhuth

New

York

Financial

Writers

tion, stated recently.
He

-

York,

former President of the New

and

Associa¬
.

..

spoke at the first luncheon

the

Hotel

Conn.

Green

"This is

added.

"Dr.

,

Princeton

just

on

in

Jean

Gottmann

of

is working
project with the

a

tions

in

ment

of this kind

the

country.

constant

lation

from

areas

and

continues,
come

a

cities

indicated

of the

into

by

popu¬

machine

suburban

present

trend

will

be¬

"Mega is a Greek word familiar
from megacycles of hirfi fame. Its
Latin
equivalent
ismulti.
In

it
would
slang
it

be called
is just a

.'Helluva big city'."

•

Essentially,

the

States

future of the
predicated from

is

many

industrial

or no

call

on

flow
to

human attention.

help do this important job they
oil

-

special hydraulic oils that

through complex systems of tubes

actuate

meet rigid

controls.

These

oils

must

requirements.
research

has

pioneered

in

developing this "life blood" of automa¬

'

.

*

United

wizardry of modern

builders,

series of complicated operations with

little

Texaco
Population Assumption
iv

JOB

machines operate themselves, perform

To

:

■*

..

Thanks to the

fact.

colossal. ' In

BOSSES

...

THE

a

the

Mega-Opolis

Hollywood,

;

A develop¬

is

spread

if

% ■'

Danbury,

University

such

THAT

idle dream," he

no

support of one of the most power¬
ful and most well known founda¬

the

LIQUID

...

meeting of the season held by the
Dan bury Chamber of Commerce
at

THE

a

constantly increasing population.
In the early 1960's, the postwar
baby crop will become of mar.riageable age and thus produce

tion,
in

one

of the many ways it cooperates

furthering industrial

progress.

■'

,THE

TEXAS

COMPANY

"great economic pressure for more

*new homes, more new furniture,
'more hew automobiles, more new
roads, more new schools, more
*

new

everything.

-<

"Since this will
deal

of

-

*

§1

require

to

money

-

a

good

translate

m

into

"reality, it is important that all of
us,

you

■New
and

here

in

England,
the

!

Danbury and in
in New York

we

country

-prepared for such

as
a

whole

a

be

development,"

Mr. Dickhuth said.
It

at

comes

only prices
of

inflation

-constantly
-

a

are

time

going

but

when
up

not

because

because

improving

of

the

technology.

"Machines which used to last 15 to
20

years,

know

as

you

in New England

well, are now obsolete
years," he concluded. "Re¬
placement requirements are great
so

in five

indeed.
They cost money.
Ex¬
penditures-for such purposes must
come

ever

bank

out of the savings,

by what¬
they are called, be it
loans, be it stock or bond

name




TEXACO
Progress

...

ji,
'-i

.r.'fi*-'-

.

in

north¬

eastern
of

»

great

a

territory

the

-u.«

...

communi¬

at your service

•

1

•

e

••

i

v

'.v.'L

/

The Commercial and Financial Chronicle

have

approved

The

Co.

News About Banks

Union

CONSOLIDATIONS

C.

William

Bankers

and

OFFICERS, ETC.

NEW

REVISED

CAPITALIZATIONS

He

Bank,

Manhattan

Chase

The

Lyon and
Kenneth J.
Sickler to Assistant
Vice-Presidents in the bond de¬

motions

of

A.

Roger

comptroller. Before coming with
Colonial, he was with the Mount
Pleasant Bank & Trust Co., Mount
if

formerly

They were
Assistant Treasurers.

partment.

if

Co., Lynbrook, N. Y. cele¬
brated
its 50th Anniversary, on

'

partment and Paul A. Volcker, Jr.

has
size

publications

inal

research

and

if

if

honorary

cover

a

of the orig¬
passbooks used by the Bank
when it opened in 1907 and con¬
and

appearance

staff

of

organization

of

pany

Bank

years

or

its annual dinner re¬

held

more,

25

for

union Nov.
William

840 attending.

with

8

J.

Sartor, presided and
as
President by
Louis R. Ince. William E. Bensel
succeeded

was

spoke

the

for

inducted
cludes

members

new

the club during

in

club's

The

19

active

in¬

retired

and

members of the staff in New York

chapters

and abroad. Overseas

in

maintained

are

London, Paris and

Brussels.
if

sjt

sjs

that

announced

York

it

new

on\ Pine Street.
Chemical Corn

head-office build¬
moves
into its
building and plaza

Chase

present

ing

when

Chase

new

60-story

now

under construction.

The

Chbrnical Qorn
fan height

proposed

structure
from 16

the

over

would

stories,

21

to

range

:!('

if

f

flt.

.

of the Bank

on

will

continue

a

Director

executive

the

of

member

as

and
com¬

Trustees

the

of

Company

Nov.

7

United

of

States

York

New

on

elected

N.

Y.

Bank

Burling became Assist¬

Mr.

Chairman

ant

Trust

Plains,

White

in

The

of

President

Formerly
Citizens

The

#

#

given approval by the New York
State Banking Department to in¬

80,000

Capital

the

shares

Stock

the

of

from

$25

;

•

*

if

■

if

■

J,

'*

certificate iw

Merger

from

and for
value of
to $20 per

par

F

share.

of

shares

shares,

100,000

to

reduction

a

of

number

the

authorized

issued

a s

Comptroller of the Cur¬
approving and making ef¬
fective, as of the close of business
Oct. 25, the merger of The Seneca
the

County Trust Company of Seneca

Strong,

who

and

man

chief

will

midon

also

Board

of

continue

officer,

executive

Chair¬

Mr.

re-elected

was

Trustees.

Am¬

N.

with

Y.,

and

Trust

of

$1,895,000.

effected

under

and

title

"Lincoln

Bank

of

and

Trust

Syracuse."
John F.

Lawlor, Assistant Viceof
Irving Trust Com¬
New York assigned to the

Woolworth

Building branch
the age of 64.

Oct. 29 at

%

The

if

annual

Quarter

dinner

Century

New

York

York

was

Grand

died

Trust

held

of

the

Club
of
Company,

The

last

Ballroom

night

of

New

in

the

the

Plaza

Hotel.
Two
and

staff

of

tended
cers

hundred

and

non-officer
the

the

fifty

members

Trust

officer
of

the

Company

at¬

dinner. The

new

offi¬

elected for 1958 were—Elmer

P. Beislie,
President, Joseph A.
Deck,
Vice-President,
Sophie
Shopmann, Secretary-Treasurer.
Adrian M. Massie, Chairman of

At

the

of

common

The

was

President
pany,

Company

the

member of the board.

National

Syracuse, New York with
stock

stock

common

of $100,000, into Lincoln

been

to

had

He

as

merger

the

charter

National

Company

of

v

effective

date

the

of

the

charter

title

and

"The

of

Farmers National Bank and Trust

At

the

effective

date

of

the

consolidated

bank

$412,500,

$25 each; surplus of $775,000; and

Zeckendorf,

Jr.

and

Calder, Jr. have

been

elected

to

the

Board

of

At

the

City.

K.

Horace

Board,

tial

Insurance

In

*

Stockholders at

a

Company,

1901

to
if

if

if

Mr. J. W. Alberts

Vice-President

dustries,

Inc.,

Mr.

on

Bailey,

President

of

Nov.' 7.'

who
is a ViceColonial, has .been

with the Bank since 1941. Earlier,
he
was
Colonial's
auditor
and




j
a

Potter

Bank

Trust

&

if

if

Girard

L.

Warren

President,

prove

2

a

will

merger

Board

special meet¬
asked

to

ap¬

proposal

of

the

Stamford

Conn.,

National

Bank of

Co.,

National

Conn,

■

contract

Work

office will

in

has

The

direct

San

for

its

•

-

Lynn

Cali¬

Washington.

location

will

Nov.

He

Division

Out-of-Town

passed

away

1, following 'a brief illness.
44 years old.

was

is

and Director of the First National

Corn's" specialized

Bank,

Business Development Department

Mr.

Girard

organized

last

under

year

the

leadership of George H. Brown,
Jr., Executive Vice-President, and
Earl
H.
Cunerd, Vice-President.
The
department
also
includes

thre£ Philadelphia Divisions: Cen¬

Vice-President

in

Jj!

1957.

Kenosha.

began -his

in

Commercial

the

held

National

position

Bank

Directors

proved

a

of

with

Illinois

Chicago,

111.

as

the

of the Randalls-

merger

town

Bank,

Trust

Co.,

into

the

Baltimore,

and

the

Stamford,
Bank

in

National

Norwalk, Norwalk, Conn.

Maryland
Md.

If

ap¬

proved by stockholders the merger
will become effective Dec. 2.
*

sale

a

sit

of

Si:

Bank,

Vice-President.

a

the staff of California

March, 1955.

National
Ohio
to

Bank

was

of

the

Wadsworth,

increased from

$300,000

First

stock,

effective

shares,
Union

par

$200,000
Oct.

28,

outstanding—
value

if

$10).

proved

and

Trust

ings Bank of Riverside, Calif, the
Security

Trust

&

Savings

Bank,

San Diego, Calif, and the Security-

National

First

Bank

Calif. They

geles,
under

title

the

National

of

Los

An¬

Security-

the

of

With

Bank.

Allen

Sutherland

Rohr

cf

San

and

been

places in the

chairman of the Coaches' Rules

Committee,
is

a

former

a

With Hill Brothers
(Special to The Financial Chronicle)

ST.

LOUIS,

Smith

is

now

Mo.— Fletcher D.
with Hill Brothers,

Security Building, members of the
New York and Midwest Stock Ex¬

Joins First Securities
(Special to The Financial Chronicle)

DURHAM,

shareholders of the

former

stock,

share

of

C.

—

Frank

W.

Street.

Phila. Inv. Women Meet
PHILADELPHIA,

Pa.

—

T h e

regular dinner meeting of the In¬
vestment Women's Club of Phil¬

adelphia will be held on Monday,
18. 1957 at 6:15 p.m. at The

Nov.

Philadelphia.
The
will

ceived 621,000 shares of
First

N.

Williamson, Jr. is with First Se¬
curities Corporation, 111 Corcoran

Barclay, Rittenhouse Square East,

management.

Security-

two shares for each

or

Citizens,

Security

Trust

speaker

be

who

Mr.

will

"Christmas

for

the

William

H.

evening
Turner

how

demonstrate
Comes

to

Life"

flowers.

with
,

*

holders received 477,000 shares on
the basis of
for

each

nine-tenths of

share

000

the

Angeles

a

share

of

Keenan &

Clarey Add

(Special to The FinanciaE Chronicle)

held.

number

Security-First

Medaryville, Indiana, merged un¬

campaign, served for 25 years

1956

the

Mr.' Fred

have

Diego

named to prominent

Los

Bank,

at

season

opened Nov. 5

Mr. Elden Smith and Mr.
Philip Boyd of Riverside and Mr.

Company, Winamac, Indiana, and
State

Little, who rounded out his
of football coaching
Columbia with the end of the

Mr.
27th

ap¬

merger
between the
National Trust and Sav¬

The

Medaryville

announced.

a

Citizens

The exchange brought

Sit

Bank

The

changes.

authorities

banking

Citizens National of Riverside re¬

new

Club, Sumner

at

Emerson, Bond Club president,

V

The

The

capital stock of The First

Sit

of

ap¬

Bankers

19

B.

Con¬

National

Bank, Los Angeles, as Vice-Presi¬
dent in charge of the Out-of-Town

First

banks

Tuesday, Nov.

Hannahs

#

both

New

of

on

be held

Inc.

associated

Division in

Club

Bond

The

Little is now executive represen¬
Assistant tative of Canada Dry Ginger Ale,

of

1955 Mr.

tinental

joined

lunch¬

guest-speaker at a

of

of New York and

From 1948 to

He

the

eon

the He

Vice-President.

was

be

York to

post he still holds.
president of the
and Football Coaches' Association. Mr.

career

with

1938

Trust Company

psychology employed by

brokerage firms.4

N. Y. Bond Club

as

Hannahs

banking

and

sistant Vice-President in 1954 and
to

in

stock

on

Little, former football,
Vice- coach at Columbia
University, will

Jr.,

Division, is resigning from 7 Mr. Hannahs was the son of
the Girard Corn Exchange at the
Lynn T. Hannahs, Sr.,- Chairman
end of the year to join a bank of the Board of
Directors, Brown
up-state.
National Bank of Kenosha, Wis.,
The

the sales

Club

will speak on

Loeb

Mr.

To Hear Lou Little

Town

part of

14.

Lou

Calif,

Angeles,

Nov.

;

be¬

President in charge of the Out-ofTown Division at California Bank,
Los

'

Loeb

Executives

Sales

if

Hannahs,

T.

York

$562,000,000,

and

Alto

M.

the

on

begin im¬

offices; in

Oregon

Palo

of

excess

.

In announcihg Elwell's,appoint¬
ment, Smith said that Robert R.
Williams, Jr., Vice-President, who
has been in charge of the Out-of-

$

Directors

Trust

First

Greenwich,

if

of

its

California,

Village.

new

fornia,

Vice-

Department, it was announced by
Geoffrey S. Smith, President.

common

Co.
❖

The

be

" if

if

'

of

Bank

head of the Out-of-; come-its 17th office.
'
if
if
of
the
Banking " '. '

as

Baton

of

increased

Palo Alto office in Town and

and

Exchange

Division

Town

"

The Bank of California has total

Elwell,

F.

Company, will address

the luncheon meeting of the New

out¬

mediately with completion sched¬
uled for Jan. 1, 1958.

Co.,

Bank, Philadelphia, Pa. has desig¬
nated

&

Hutton

capital stock from $600.-

resources

Corn

Address Sales Execs."
Gerald M. Loeb, partner in E.

G.

if

Trust

by

>

$1,200,000 effective Oct. 30.
shares outstanding—par value $10).

bank's

7

Pittsburgh, Pa.

-

value

par

Bank

Louisiana

Country

Assistant Treasurers

elected

the

National

new

Cotter and Thomas B. Smithyman
were

realty departments.

Francisco, California has awarded

Norman ^W.

and

if

if

the-'construction

elected

Honolulu, Hawaii elected Clair J.
Vice-President
for
all

Devault

stock dividend the Louisi¬

a

The

,/

was

)

Ltd.

Co.,

(Number of

present

Fidelity Union Trust Company,

if

Trust

,

,

120,000 shares,
/V 'V.V ■' if -;i

banks

the

shares

of

shares,
7:

000 to

if

if

Bishop

effective

stock

new

(Number

American

Bank, Honolulu, Hawaii.

Security

of

Bank

$250,000 to $300,000
of

30.

common

1920*.was

the

form

(Number of shares

announced

to

of

one

merged

30,000

Dec.

sale

Rouge,

Fidelity / Trust

the

by

f

ing

the

ana

moving to the new building
will be returning to a

By
if

from

tf

Company, which is

site which from

$137,500.
❖

and

Oct.

Bank

the

if

standing—6,000

erecting the structure.

Trust

President of
Chesapeake In¬
Colonial's parent,

of

Office

elected

was

the

of

Gerald M. Loeb to

.

capital stock from $150,000 to $250,000 by a stock dividend

By

a

Bank, Lynn, Mass., into the Essex

Jr.,

,■

a

National

"

if

Soong

Ming

Vice-President

Chippewa Falls, Wis. increased its

contract with the Pruden¬

under

MacMillen,

and

-

First

Montreal,1

140th anni-

its

if

if

Kai

Common

$50).

Manufacturers-Central

Colonial

of

*

The Bank has 721
offices, staff of 12,000, and assets
of more than $2,700,000,000.

if

Bank

if

Nov. 3.

versary

The

National

^

•The

President, disclosed that the bank
is buying the land and building

time, Charles F.
Bailey has been appointed Treas¬
urer of Colonial
Trust, William C.
same

if

First

and 21.

Corbin, Chairman of
and
Roy
F.. Duke,

undivided profits of not less than

Colonial

Trust Company, New' York

on

headquarters.

con¬

divided into 16,500 shares of com¬
mon
stock
of the par value
of

G.

Vice-Presi¬

merger,

Company addressed the members
briefly.

Robert

Main

future

its

be

Company of Rome."
solidation

if

Second

were

new
building and Centennial by
having open house on Nov. 19, 20

and

i'fi

will have capital stock of

if

George S. Clough
to

if

Canada celebrated

Vice-

Elgin; Elgin, 111. is celebrating its

|-

West, headed by Ray¬
merger
the receiving association
mond
J.
Euler, Vice - President;
will have capital stock of $1,895,South and Northeast, headed by
000, divided into 189,500 shares of
C. Robert Haines, Vice-President;
common
stock of the par value
and Northwest, headed by M. H.
of $10 each, surplus of $3,470,000,
and undivided profits of not less Callender, Vice-President. Within
each of these city territories, the
than $1,111,895.
Vice-President in charge directs
❖
if
if
a
staff which is responsible for
The Farmers National Bank and
loan
administration,
customer
Trust Company of Rome, Rome,
service and new business develop¬
N. Y. with common stock of $350,-'
ment in the wholesale and retail
000; and The First National Bank
banking fields.
;of Remsen, Remsen, N. Y., with
Mr.
Elwell
joined the Girard
common stock of $50,000 merged.
As of the close of business Oct. 31, organization in 1951 as Assistant
consolidation was effected under Treasurer, was promoted to As¬

the Board and Hulbert S. Aldricli,

if

will

tral

President of The New York Trust

William

Robert

and

named

were

if

the southwest corner of
Bank
Streets, which

on

Broad

of

Trust Com¬
N.
Y.
was

Schenectady
Schenectady,

pany,

Bank

elected

Rastetter

7, page 19.

and Nov.

17

page

The Bank of Montreal,

dents.

by the Prudential Insurance Com¬
pany

Company

❖

Falls,

was

and

The

if

if

C.

advanced

purchase of the new
building, now under construction

County

The

of

when the two
organizations merged in 1950. In
August of this year he marked
50 years in banking.

Hoyt Ammidon,
President, effective Jan. 1. Mr.
Ammidon will succeed Benjamin
who

Maurice

to

place of Peter V. Moulder:

the

9

occupied

rency

Trust

and

Newark, N. J. announced

pany,

He

31.

Dec.

mittee.

by

.

Assistant Chair¬

as

man

crease

takes

Nov. 12

York, announced on

New

plans to retire

is

office building to
present Chase Man¬
hattan bank headquarters building

planning a
adjoin the

of The
County
in White Plains,

Burling

Company

Exchange Bank,

Chemical Corn

New

John
Trust

1957.

roster

present

1,477

if

the

if

if

if

have

who

York

New

the

elected

Fidelity Union Trust Com¬

The

and

Bank

ganization
of
the
history of Lynbrook.

members of Guaranty Trust Com¬

served

data about the or¬

tains historical

if

Guaranty Quarter Century Club,

Pa.

Director

a

'

anniversary pamphlet
that is a replica in

A 20-page

to financial economist in the eco¬
nomic

Edwards

J.

in

Jenks

Sharpe

Reed

' i

if

3,

if

elected

Oct.

peared in the "Chronicle" of

"i*

'*•

,

Presidents and Henry K. Gardner,
Wallace W.
Wilson, Norman W.

Hodgson, Vice-Presidents.'

Nov.

7.

Nov.

the loan review de¬

department.

if

Philadelphia,

Lynbrook National Bank &

The

Trust

New appointments were those of
Charles L. Vohringer to Assistant

Treasurer in

W.

if

if

30.

The Fidelity-Philadelphia Trust

Co.,

Arthur

Y.

Pleasant, N.

Oct.

■

Chicago,' III.

W.

Richard
A.

retirement.

his

Co.,

serve

of

Bank,

Executive Vice-President

•

New York has announced the pro¬

Director
died

City, N. J.

was

before

'4T

Trust

National

First

Company.

A

The Continental Illinois Bank &

Frank

Boyer,

Boardwalk

the

Atlantic

of

Trust

and

ap¬

state

if

if

if

NEW BRANCHES

and

title

and

Bank
A

is subject to

merger

of stockholders
banking authorities.

proval

charter

der

under

merger,

a

the title of Fairfield County Trust

a

Thursday, November 14, 1957

...

(2122/

22

to 5,880,-

shares

National 'Bank

outstanding. A

of

MINNEAPOLIS,

of Pillsbury

pre¬

vious article about the merger ap¬

Minn.

—

John

Banks, Jr. has been added to
the staff of Keenan & Clarey, Inc.,
L. L.

Building.

He was for¬

merly with the Central State Bank
of Duluth.

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

value

Finding Your

kind

provides
to

as

well

be

stock.

numerous

may

inflation, and that such
vestment

is

.

are

own

state

not

only audited by

communities, but also

'Or

national

examiners,

Stockholders

can
at any time get a financial
statement, free of cost. You, there¬
fore, can keep a constant watch

on

your

bank's

financial

certain

of

to

notes

State

National Banks. Most

or

Instead of bank Statements be¬

ing padded, they usually contain
"hidden

assets."

Banks

may

be

Give

Local

Prestige

helps one's credit

Banks,

no

stockholders.

not

or

fear

would

be

secure

a

York

in your

Stock

Exchange, even if
they are of the highest grade. It,
however, does help one's credit
and standing to be a stockholder
in the local bank. I especially ad¬
vise

young

their

bank

stock

every

such

bank

me

say
one

businesses which need
new

competitors.

hard

for

charter

city

or

any

for

(Special to The Financial Chronicle)
,

MARYSVILLE,
Steffensen

E.

with

Jensen

With

Stromer, 426 East

Logan Co.

PASADENA,
of J.

has

Calif.—Robert R.
joined the staff

Logan & Co., 721 East Union

Street.

LOS

C.

ANGELES, Calif.—Luther

Martin

with

has

become

Witherspoon

&

Walston Adds

was

stocks, I have in mind the stock

previously

with

to

popular

very

years

ago

Diamonds"

by

well.

story

The

book

entitled

was

of

The

40

"Acres of

Russell
was

H.

Con-

He

Waddell

Reed, Inc.

the

true

(Special to The Financial Chronicle)

&

ion

FRANCISCO, Calif.—Mar¬
Kelley has become affili¬

W.

ated with Walston &

Co., Inc., 265

Montgomery Street.

mond

has

dia¬

a

expert

had

Oil

Company

of

account

how

Ohio

attracted

than

more

sought

the

entire

world
for
est

*

lover

the

10,000

larg¬

diamond,
it

and

finally

shareholders

new

was

found

his father's

on

farm.
S

:

o

"u

h

in

; 'h

mtm y

readers

the

past .three years

are

today seeking
the

safest

good

yield¬
invest¬

Roger W. Babson

ing
ment
to

me

in

that

it

city.

own

bank

ment.

pleasure for
that < it may be
a

suggest

his

local

is

I

refer to

stock

your

invest¬

an

as

Your local bank will prob¬

ably show
1957

increase

an

earnings,

of

10%

compared

in

with

!956.I';'-"
■Furthermore,
only

an

der

today's

tions.
are

most

banks which

no

their

banks

increase

1957.

are

in

dividends;
planning

dividends

for

■

,

Effect

of

National

Interest

Increases

.

The

showing

in earnings un¬
competitive
condi¬

know of

decreasing

While

the

are

grojp

advance

I

some

'

banks

investment

such

real

the

for

reason

pros¬

perity of banks is tne increase in
the

basic

Federal

Reserve

rate.

Since the middle of 1955, interest
rates of the popular "3-to-5
year"
U.

S.

Government

world's

most

most active

issues

12

and

bonds) have increased

55%; while the rate
months"

creased

(the

conservative

U.

S.

110%.

the "9-to-

on

issues

Rates

has

in¬

prime
have increased
on

commercial

paper

about 90%.

Yet current indices of

bank

prices

stock

Statement of consolidated income

•

Nine months ended September 30

practically

are

1957

1956

$219,129,472

$205,974,569

157,475,498

148,484,802

18,437,229

18,168,317

unchanged since mid-1955.
Local

bank

stocks

have

a

Net Sales and

poor

Other Income

.

and

irregular marketability. If you
to buy 10 shares, you will
probably
have
to
get
them
through the President or Cashier

Cost of Sales and

wish

of

the

find

bank.

likewise

buyer when

a

sell.

He

On

stocks

the

of

you

other

big

must

the

Na¬

Manhattan,

tional

City, and the Guaranty
Company
of
New
York

Trust

City
be

active

are

bought

or

Banks

the

have

very

Their

form

credit

tors

Bank

can

Net Crude

little compe¬

of

up

with

business.
balance

State

which

or

t

new

you

9,025,482

$ 32,007,449

$ 30,295,968

—

Stock

........$

Outstanding
$

Gas

$

2.44

13,126,753

Per Share

Natural

Liquids Produced

—

Refinery—Barrels

Barrels

.

2.31

13,126,753
$

1.20

1.20

29,344,000

29,600,000

11,289,000

11,984,000

Subject to adjustment by independent public accountants upon completion of year-end audit.

On October 30,1957, the Board of Directors

declared

a

dividend of 40 cents

per

share

on common

stock, payable December 10, 1957, to shareholders of record November 12, 1957.

National

doing

are

Also, try to keep

Oil and

Crude Oil Processed at

deposi¬

the

11,209,296

..........

PERIOD

FOR THE

Cash Dividends Paid

It will help your personal
to try to get new

for

INCOME

readily

Inflation

starting

Income Tax

Net Income Per Share Common

competition takes
gettiag
deposits

of

rather than the

banks.

and

for Federal

Shares of Common Stock

sold at any time.

Competition
tition.

and

NET

the

like

First

Chase

the

Provision

.

.......

desire to

hand,

banks

Expenses (Exclusive of charges set forth below)

Depletion, Depreciation and Amortization

a

good

yourself.

THE

Banks do not suffer from infla¬
tion. If money becomes

"cheaper,"
they take in money of declining




*net increase

Producers

•

OHIO

Transporters

•

OIL

Refiners

•

Staff

connected

Company,

community.
A

Leland

affiliated

(Special to The Financial Chronicle)

SAN
to

—

#

Joins J.

to

town.

Inc., 215 West Seventh Street.
refer

I

now

I

bank

Witherspoon Co.

Calif.

(Special to The Financial Chronicle)

year.

When

is

&

Fifth Street.

It

group

new

a

23

Joins Jensen Stromer

Rockefeller

people — men
or
acquire a few shares

local

Let

final thought: Banks are

a

of the few

social standing in the community
to own stocks listed on the New

of

in¬

Savings

as

Stocks

seldom

condi¬ women—to

tion.

ownership of stocks on the New
York Stock Exchange in
building
up one's credit standing in the

examiners

or

Bank

than

an

helpful

more

in

Bonds;
but
wise
buy only short ma¬

perhaps by both.

or

competition, do not suffer from

the

have

by

banks have little

by

"valueless"

as

valuable.

is

Careful Examinations

bank

Claims

treat

the decline of their long issues of

Banks

local

own

compelled

Government

banks

It

investment"

one's

way

Loan

harms

turities.

why the "safest

good-yielding

same

only

Banks
hence

their

Babson

out the

The

Federal

By ROGER W. BABSON

Mr.

pay

Banks, and Co-operative
are
mutually owned and

inflation

bankers will

The Back Yard
reasons

also

money.

collateral; but these are not
destroyed and may again become

that

Diamond in

and
of

(2123)

COMPANY

Findlay, Ohio

Marketers of MARATHON Petroleum Products

24

The Commercial and Financial Chronicle

(2124)

maintain

legal

in the years, changes in these ratios do dates from the Federal Reserve- >
the Federal -not presently constitute a normal Treasu ry "accord" of v 1951 -when y

at

equivalent to spe-v method
of their de¬ trol.
posits, the tofal quantity of bank
■Prior

of

Reserve banks

cified

Upon Commercial Banks
Policy,

Federal

bank

economist concludes that banks should
satisfactorily under modern monetary management

Association's
function

sales

top

fair average level of rates
Dr. Adams ventures the thought, however, that

the years.

shakened confidence in

policy's effectiveness

monetary

their

unique. Typi-; responsibility to see to it that the
cally, our pri- Treasury's new flotations find a
vate and cen- home, or at least lodging for the

banking

-Vfleet heavy
;

b

.

o r

rowings

^ from other
nations, but as
is our custom,
; we have mixed'
2 them into a
new
blend,

v
'

.

adding

some

ingredients of
own.

our

Dr. E. S. Adams

is

element

historic

our

pro¬

pensity for spawning banks. Other
nations may boast older banks,
purer
banks,
or
even
stuffier
banks, but no nation, surely, can
claim to have

been

prolific

more

than the United States in breeding
banks.
Indeed, many of our in¬

dividual

have

states

closed

more

banks than most nations have

ever

opened.
To

banks

hold

fraction of

However,

of

many

commercial

whose

on* trial

still

tiny

explain

and

only
a
small
banking resources.
have some 45 banks

our

we

over

450

$500 mil¬

banks

whose

management has developed
United States and its ef¬

fects upon banking.

present rationale of Amer¬
policy is
based
confidence in the beneficent
monetary

upon

functiqning of the forces of sup¬
ply and demand in a free, or at
least a semi-free, market.
Con¬
sequently, the emphasis is almost
entirely on general quantitative
controls, as against specific, qual¬

back

is

to

»

is

What

the

are

Federal

Re-

about implementing them?

One notable difference is its

with

domestic

conditions.

In formulating their
policies, the Federal Reserve au¬

thorities

can

balance

or

virtually ignore the
imbalance

of

inter¬

national payments.
This is by no means

blessing.

It

authorities

they had

an

obviously

unmixed

gives

latitude

more

tlie

than

if

precarious balance of

a

payments problem
their heads like

a

dangling

over

sword of Dam¬

On the other hand, without

sword, it

may

be

ficult for them to take
effective

more

than

in

for

more

the

of

central

a

di¬

Economy.

the

bank

authority

ample

money

to

sup¬

The thesis is rather that best

likely to emerge from

are

minimum

in the

of

direct

by the

bank.

This

not

does

Federal

types of credit

that

mean

Reserve

the

authorities

developments

nore

interven¬

credit markets

nor

in

ig¬
particular

that they are

unwilling to intervene in specific

The main objective of
monetary
policy in the United States is, in
general
terms, the same as in
most countries;
namely, to help
keep the economy on an even

preoccupation

laissez

questioning

no

with

central

let

serve's objectives and how does it

throw¬

a

and

Planned

regulate the nation's

tion

discussing these effects,
us examine
briefly U. S. mon¬
etary management at the present

Smith

the

of

necessity

a

Monetary Management
Before

means

no

direction

that

rection

ply.

Objectives and Rationale of

by

Adam

faire, though it is certainly
in

dif¬

timely and

action.

credit
clear
an

where

areas

case

there

is

the

United

where,

another

central

bank,

mentioned

in

States
purpose

though
the

else¬

as

one

official

of

the

rarely

of

being their

stock

•An

a

rigid pegging

address

by Dr. Adams before the
International
.Banking
Summer
School,
Garmisch, West Germany




bank

member

borrowing

is

a

sensitive indicator of the pressure
of demands for credit at the mem¬
ber banks and is therefore useful
a
guide for open-market pol¬
icy, Indeed, in recent years, openas

market

^operations

been

have

market

borrowed

total

minus

serves—within

re¬

considered
Suitable- to the -degree of credit
restraint or., ease desired at the

intervention is far less clear, they
are most reluctant to intervene.

of

flexible

open-market

a

range

the

banking system either with a
with a ladle, depending

policy, this talk has just about
disappeared. It is significant that
in restraining credit during 195153
and
1955-57,
the
Reserve

modern

conditions.

authorities have not raised

years

reserve

requirements. Under U. S. condi¬
tions, open-market operations

are

clearly far preferable to changes
in the reserve percentages as an
instrument for restricting credit.
Reserve

reserve

remain

un¬

classic patcyclical boom, including *
heavy demands for bank loans. '
the
Unitqd States that-existing The monetary
authorities have
requirements are ; too high and concentrated their .attention pri*
that if they
remain, unchanged, marily on restricting the growth
j
they will become increasingly in¬ of the money supply. They have j
appropriate as our economy con¬ dribbled additional reserves Into i
tinues to- grow. Over the years, the
rbanking
system
via ; openahead.
There is widespread agreement in
changed

over

years

Federal.

the

Reserve
time
..-requirement

lower

the

ratios.

At

reserve

least

of

some

these

reductions will probably be timed
to

not

are

com¬

changes

even

an

and

regret¬

imbalance be¬

uncontrollable

largely

a

demand

rather

the

as

partially controll¬

a

supply of lendable funds. The

discount rate is occasionally used
accelerate

retard

to

or

movement of interest

rates but is

anywhere

being
important as

regarded

near

as

ket

the

as

open-mar¬

More often than not,
the discount rate are

policy.
changes in

a

central

the

heads

banks

intense not
but

credit

bank

has far

sion

but

are

is

it

aims
and

completely

not

with

the

policy

Reserve

receptive

non¬

bankers

American

sympathetic

appeals for

to

from the monetary
general, however,

In

authorities.

the latter have refrained from re¬

They

appeals.

such

to

recognize that in this competitive

of

actions

the

the

in¬

dividual banker must be governed

Influencing the Interest Rate
Structure

own

keeping with this philosophy,

open-market

operarions

fined

exclusively

almost

short-term securities.

by the interests

primarily

Moreover, it is part of the free

are

con¬

market

to

very-

flowing

The theory

least

how

rates.

is

ment

policies of banks and other

financial

institutions,

are

by

no

lost sight of. In brief, qual¬
itative factors are taken into ac¬

means

count

in

deciding

how

to

apply

Let

examine

us

these

quantitative
applied.

briefly

how
are

that
have

The

consists

Policy Is
Implemented

most

of

important

open-market

control
opera¬

tions in government securities
by
the Federal Reserve banks. Since
all member banks are

required to

impact

important

an

short-term

rates

will

thereby

ence

upon

"the

on

interest

effect

have

the

that

and

some

entire

rate

upon

they

avoids

serve

the

pattern
it

translate
of

of

to

the Federal Re¬

market

forces

to

on

for

guide

pelling

directing

it

credit,

of

is

in

except

payments

clear and com¬

a

the

what criteria

to

use.

occasional exception, pre¬
this task.
That, greatly oversimplified, is
what monetary management con¬
only

an

fer not

to essay

in

the

United

States to¬

first

today re¬
being a fixed

restraint, then during a period of

of

day. Let
affects

as

us

the

during

now

consider how it

commercial
a

period

of

banks,

credit

taken place
in the reserve re¬
quirement ratios over the past 21

effect

of

loan

expan-

the money supply.

In other words,

monetary policy

primarily through its
effects on bank investment poli¬
cies. Instead of being buyers of

has operated

Government securities on balance,

they had been during 1954, the
became sellers on balance

as

banks
on

a

large

very

not

scale. This

only

assumed. Asset growth
restricted:
operating
costs have continued to rise; and
the banks have raised their inter¬
est rates paid to savings depositors.
Intense
competition
has
held
down
bank lending rates much
more
than might be expected in
be

might

been

has

the

of

view

for

mands

a

unprecedented de¬
limited supply of

credit.

bank

the magni¬

banks foresaw

Few

of the loan demand that

did

develop and many liquidated their

a

remaining holdings show

substantial market depreciation.

profits

Security
solation

Credit Restraint Affects

Banking
The

present

manaprpment

in

been

have

re¬

by losses, the chief con¬
being that the losses can

generously shared with the tax

be

collector.

Effects
In

to

these

effects

on

investments, lending policies
been affected as well.
Two

bank
have

surveys

conducted by the Ameri¬

Bankers

can

Bank Lending

on

addition

Association

among

during this period
shed
considerable
light on the
nature of these effects and why
its

members

they have taken place.
With

loans

volume

posit

of

ally

expanding

held

loans

risen sharply.
How

obligations

short-term

of

nuded

and their

ratios

ease.

which the Federal Re¬

serve's control levers rest. Despite
the numerous changes that have

to clamp down on

the

on

to

The
Federal Reserve authorities, with
decide

requirements

are

sion

extremely

wartime,

reserve

garded primarily
fulcrum

provide

banks

to

has clearly
bank
but rather to force the
liquidate Governments to

aim of monetary policy
not been

country where the placed

a

balance of international
does not

allocated.

sists

or

market.

legal

in

be

tightening
the long-

easing

an

short-term credit

member

After all,

difficult,

to influence
interest rates and

should

credit

flow

trying

of

of

tion may be

influ¬

However, by restricting its
operations to the short end of the
government list,

ence

struc¬

ture.

term

Credit

are

recognized, of course,
these operations will in fact

leaves

controls

obligations

thing to money" and that

It

The
How

these

of

philosophy that the results
from these responses of
bankers to the influ¬ portfolios of many banks are de¬

operations in these securities will

naive

that

holdings

individual

have the

faith in an oversimpli¬
quantity theory of money.
emphasis, to be sure, is on
regulating the quantity of money
but in doing so, such factors as
the velocity of deposit
turnover,
the uses to which credit is
being
put, and the lending and* invest¬
a

is

nearest

bank

securities. The chief

lower-yielding short-term securi¬
ties first.
By now the investment

The

approach reflect

in

Government

tude

bank.

fied

this

does

has

of his

quantitative credit regula¬
far better than if the
central bank were to try to decide

Nor

Consequently, the huge increase
in bank loans
been financed largely by a

that has taken place

especially in the capital market.
Bank
earnings have improved
somewhat but not
as
much as

Federal

of
are

average

.

States, moral
relied upon

Most

very

situation,

supply.

In

y.fhan
growjthr

agencies, moral sua¬
less chance of being

So, in the United

existent.

nig- *

curbed the growth of the
money supply; it also transmitted
the impact of monetary policy to
non-bank lenders and investors,

suasion is not heavily

sorting

Reserve-influenced

banks and non-

effective.

result of the

Federal

is

only among the banks

between

also

competition

where

and

cooperation

interplay of demand

the

In

banks.

these

of

United States, however, where we
have
such
a
large
number of

simply a belated confirmation of
changes that have already taken
place in the credit markets as a
and

less.

influence

to

bank

banking policies by means of in¬
formal
conversations
with
the

very

deposits to j
for normal j

demand

increase " in

reduction
countries,

some

in

gardly 2 fashion.
With
deposit *
velocity rising, as it usually does ,
during " a ■ boom, :rthe - Reserve ;
authorities have held down the \

lending

table result—of

not

operations

market

offset

In

,

of

tern

banks to

in
interest
rates are regarded as being sim¬
ply the inevitable result—and at

to

stances.

adhered closely to the

banking system is dominated
mere
handful of private
banks, it is not too difficult for

rates

1954, develop-'?
States have

United

the

in

ments

by

of the economy.

pletely ignored, by any means, but
they are not relied upon to have
much effect either on savings or
on demands for credit.
Generally

able

be discerned

Since the end of

that

mean

will
the

they presently exist *

as

exist in the future, can; J
fairly clearly, -vl

may

now

your

Interest

tween

cial banks

They seek thereby to ad¬

the needs

times

Federal Reserve and the commer-u

States call "moral suasion." Where

at

or

excessive

up

just the flow of money and credit
to

goes

monetary

Requirements
This does not

-

without saying that the 1
developments of these
will not be precisely re- <
peated in the future. Nevertheless,
in many respects the character ofthe
relationships
between
then
It

and

Sees Lowering

to live with
policy under

how

monetary

have

banks

the

and

learning

re¬

conditions,

mopping

serves.

been

monetary

the

Both

operate.

monetary
policy is effectuated to an impor¬
tant extent
by what we in the

economic

on

times

environment in which it must now

flexible

implement
an
easy
money
policy. However, once, the ratios
time.
■:: •.
....2'- have been brought down to a
more
appropriate level, they are
In short, the Federal Reserve
not likely to be changed except
authorities
are
primarily
con¬
under
extraordinary
circum¬
cerned with doling out reserves to

credit.

However, in an area like con¬
credit, where the case for

tion

authorities may from time to

serves

adaptation to the changed

authorities

However, with the restora¬

credit control '

Since that time, the

machinery, rusty from long disuse,
has been m process or renova¬

tute.

therefore,

primarily at keeping the
position of the bank¬
ing system—i.e., total excess re¬

their

tion and

aimed

reserve

authorities were freed obligation to support ?
Government bond prices at par. ,

the Reserve

there was some talk about
on the manipulation of the
reserve
percentages as a substi¬

at par,

relying

net

litera¬

is to assist the Treasury in
financing the public debt.
Since
1951, fortunately, this no longer

matter*,©! fact, the volume

a

regu¬

sumer

ture,

takes the form of

of

con¬

from

requirements

a

quantitative controls.
In

impairing its effectiveness,V: ;
As

credit

to 1951 when open-market
policy was rendered largely in¬
operative by the program of sup¬
porting Government bond prices

rowing is frowned upon, this abil¬
ity to borrow serves primarily to
cushion the impact of open-mar¬
ket policy but without seriously

for such intervention—

illustration

lation

reserves

speaking,

Minimum Intervention
This

course,

increase
temporarily by bor¬

spoon or

The

ican

results

a

of their attitudes

some

of the things they do or

some

do not do.

and

the

such

taking actions that

might jeopardize their continuing
semi-independence.
This helps

tary

ocles.

4hc. ^managers

and

wish to avoid

armed

keel.

United States is

agement in the

There

go

Monetary man¬

13,600

our

are

deposits exceed

and

time.

the

safeguard

to

reacquired.

now

deposits exceed $50 million.
This
largely explains the way mone¬
in

desire

their

is

degree of' independence they have

itative controls.

he sure,

collectively

lion

Finally, another objective of the
monetary authorities, and another
seldom mentioned in the literature,

to

One aborig¬
inal

;VV;;:

night.

institutionsre-*

of

can,

initiative,

own

rowing from the Federal Reserve.
However, since continuous bor¬

management in the of interest rates for Treasury bor¬
United States is a peculiarly Amer-* rowing. • Nevertheless,- whenever
ican
concoction
and
its effects the Treasury comes to the market
upon
commercial banks are in wth its hand out, the Federal Rer
serve
must fulfill its unwritten
some respects

tral

their

on

Monetary

-

reserves

volume of bank

banks

Member

may

for future economic growth.

run

oank

of

and hence of the

permanent partisan

a

operations

chief determinant

credit.

political issue. The Economist
expects: (1) monetary policy to err on the side of excessive
ease with a downturn;
(2) no further credit tightening due to
lack of liquidity, and (3) a lowering of reserves over the long
make it

For many

market

-

the

volume

the

of

open-market

reserves.

open

been

have

earnings will reflect an overall
over

absorb

years

banks'

and, despite public's bias in favor of low interest rates,

reserve

conversely,

d,

a n

banks

Reserve

member

by Banker*

Brief examination of U. S. monetary management

by the
expand
balances

securities

Government

of

the

by

bank re¬
purchases

of
member
Open market

serves.

Deputy Manager,'Department of Monetary
American Bankers Association

determined

is

quantity

ADAMS*

By E. SHERMAN

short-run

percentages

credit

1957

reserves

of. balances

form

Thursday, November 14,

...

accepted

to

of

de¬

banks'

deposits

There is

ratio

and

down,

have

no gener¬

loans

t.o

deposits that American bankers
era
of monetary regard as being critical but many
the United States
individual banks do adopt their

Volume 186

Number 5690.:. The Commercial and Financial Chronicle

25

(2125)
own

standards

in
this
regard, business * customers
who
have resorting to such an
expedient,
usually informal maintained good balances over the Monetary policy in - the United
^often
subject
to revision up- years so they can borrow when Slates operates through many
ward as
bankers become accus- they need to. And in
many cases, channels besides bank
lending and
tomed to
livings with higher ratios, of course, banks .have definite the Reserve authorities have

These criteria

earlier date, but this implies a
greater perfection of prevision and
timing on the part of the monetary

are

and

Nevertheless,
the rapidly
trend of loans
to

past

several

deposits

rising commitments to lend in the form shown
of lines of credit.

the

over

has^

years

caused

uending*

no disposition to discrimiagainst customer loans as

nam

"act "that

i

bee" an inweasing reluctance tries,
ineffective.
In a number of coun- ^"mucV^ffecreithe^on
bank loans have been

to take
t
additional losses from sell-

ing securities to obtain
to lend.

•

.

•

more

most banks have

selective

lending policies.
been

a

indeect
marked

tk>nsC

in

as

their

a

one

special

target

being

reason

for
that

hanks

or

son was

but

over the

total,

money sup-

1955<

othor

well

as

monetary policy become

were

sively

iiquid at the beginning of

point

have efficient machinery for reg-

tion.

may

much

more

^since then.- During 1955,

lending

ulating

ba^l^Prpla^vpdC<their

the

policies

~

* with
respect to
instalment loans. Also,

consui.-er

in
answering our survey taken in
the last quarter of
1955, they em-

-Since

.

been

1955,
a'

however,

decided

1

"

*

"

gome

In theory, the time lag could

and be shortened if restraint

were

to

excuse for be applied more vigorously at
~~
*
;
~~

an

b'dd""^' With Pri™tefborrow|.rs

the

?hfT™fhS'Ielfed heavUy'on

ex-

more

m te banking system.

progres-

restrictive..

Credit°ne

might

■;

wo^d seriously

impair

the monetary authorities

on,

to

have

been

ful to avoid having credit condi-

~~

.

~~

~

~

•

:

■

-*•':

~

.

-

"

•

r

" V

•

toward

greater; selectivity.: in all i
categories of loans. /After a long;

:c^;: *:*

lag, monetary policy really began :
to bite.

V.*^-'f.'<*

.'*-*

This has been
particularly true
for most medium-sized'and

-

•-*•

-

•

!

banks,

especially

large
latter.
In

the

*

certain-* financial

.centers, *. New
particular, loan demands

York

in

have

been

*'.

extraordinarily strong

and at the same

time many large ;
corporations
have
drawn
down
their balances to take
advantage
of the

increasingly attractive

turns

available in

the

re¬

short-term

money market. As a result, some
of the big money market
banks
have been caught in a
squeeze of

"

rapidly rising loans and declining
deposits. To be sure, these banks'
customers

can
frequently obtain
credit they want from other
banks throughout the
country but
this very process
helps to spread
the tightening of credit
through¬

the

out the

banking system.

Small Banks Have Credit
Small
to
to

banks have been affected
lesser extent. In

much

a

our

posits

reply

latest

survey, more than
the banks with de¬
under $50 million
reported

one-third

of

that bank credit in their localities
is

still

"readily

available"'

most

of the remainder
ized the situation as

and

character¬

being merely

"somewhat tight."
About three-fifths of the banks
reporting that they have become
,

selective

more

told

that

us

in

this

their

lending,

involved stricter

review of loan applications from
credit standpoint. Almost as

a

many

indicated

that

they

have

given

greater consideration to their
past
relationships with loan applicants.
About one-third

reported

inite

policy

of

providing

more

of

£ood

are

New

weight to the willing¬

borrowers

balances.

to

Only

in

Honolulu

about

they

ness

Beach

a def¬
faster

repayment schedules, and
the same number stated

giving

Waikiki

underseas

telephone cables

now

link

maintain

about

one

bank cut of four indicated that
was

doing much in the
scaling down the amounts

States

United

it

mainland

and

the

Hawaiian

Islands

way
of
of loan

requests.
To whac extent has this
greater
bank
lending ac¬

selectivity in
tually curbed
loans?

the

Two-thirds

rise
of

in

the

bank

deposits under $500 million,
say "hardly at all," and most of
the remaining third estimate that
loan expansion
since
1955
may
have been held down to the
extent
of
"perhaps 5 to 10%." Even

the

largest banks, only a
comparatively small minority esti¬
mates

that

their

loan

expansion

has been held down
by more than

10%.

This, of course, is not surprising.
Bankers properly feel that one of
their primary
responsibilities is
to meet the

legitimate credit needs
of their communities to the
extent
that they can safely do so.
This

obligation

applies

particularly




munication

service

has

banks

with

among

Another historic advance in

to

just been

phone

completed.

new

circuits,

system provides

For years you have
call Hawaii

Added to the present radiotele¬

com¬

been able to

and

better

the

new

more

service.

cable

and faster

It makes

it

KNITTING
The

possible for

telephone cables have been

and from

to telephone to

the Hawaiian

Islands

28,

as

under the Pacific Ocean, connect¬

clearly

own

States mainland

as you

home

operator

call

town.

your

across your

Just

call.

and Hawaii.

give the

and

1885,

American

Telephone

Co.,

includes

words:

every

February
these

"...

and

pro¬

each

of said cities, towns

each and every

other city, town

or

place in said states and countries,
and also

known

Telephone System

TOGETHER

places is to be connected with

priate

Bell

WORLD

Telegraph

phetic
and

added, stretching for 2,400 miles

ing the United

you

THE

original certificate of incor¬

poration,
and

by radiotelephone. Now

the efforts

case,

Continued

tons tighten too rapidly.

•

the

•••*»•*.'
j

_

this*

although

it ^as admittedly complicated the
task
monetary authon iea.

have to be particularly care-

"

trend :

that

assume

< * -

what-more^ strict, tneir shift in"
that direction hM been
only'Very
has

supply

SSS?^

: ;<

phasized that in the types of lending where they had become some-

moderate.

money

there would be little

J?™!?'

mucn^u*nier inaf
of the Federal Reserve to restrain
present., In tact, iiom this bank credit. This does not appear

.

uuring

1955,

tSt

SLPaqawa oSswT
onf thfl—

could become much tighter than it
r Detom<f

This is likely to be true to

gradual one, very gradual

change has

VMrC

havlalVrti

right to

once

'

'

^as been eliminated, the effects of jncieiore, repeaiecuy neeaea neip

rea-

degree whenever monetary
policy shifts from ease to restric-

'The

'

?eSS1bVe liquidtty i" jbe eC0n0m^ iberefm^repeatedVy'^ieded help

the

One

areas

because not only the banks

corporations

som+e central banks lack effective highly

.control,

in

On the other hand,

Ply* 1** tbe United States, however> tlie Federal Reserve does

many

there

out

restraint,

.

Consequently,
become

sin-

glcd

funds

more

a

Banks

nacf CAxrorQi

Also, fear

&Se<rf^^^Wn°g th6

me

before the Federal Re-

there

have

Reserve overcautious about
apply-

"loans "have eve?" that^coSsidCTab^'t

bank

we

"

'*>■'

n,.w

of stifling economic
expansion will
usually tend to make the Federal

against other types of credit.

T

The

S

managers than

expect of mere mortals.

Treasury Financing and the

v

'

by cable and other

means

world

appro¬

with the rest of the
as

may

become necessary or

hereafter

desirable ..."

on page

26

26

The Commercial and Financial Chronicle

(2126),

Thursday, November

...

14, 1957

\

Continued

from

teresting,

25

page

no

there

but

to be
banks

American

why

reason

seems

will not be able to function

factorily,

Monetary Management's Impact
Upon Commercial Banks

This is all

the

character
of
will not
change greatly over the
years
ahead. Is this assumption valid?

manship,"

very

the

the Treasury to accomplish

undermined

long, could have
whole

interest

of

structure

fectiveness

of

morality," such talk
taken too seriously.
It is really only another reflection
of the queer collectivist ideology
and
"public relations" approach
so characteristic of our
day. Talk
of "social
responsibility" makes
sense
only when we are conscious/
in so speaking, that we are lookr
ing in another way at the humble
and earthy realities to which I
is

policy.
people

monetary

The trouble is that

so

many

with serious consequences, fail to understand two basic facts:
clearly, for the earning power of (1) that in a boom the only alter¬
ciably their pressure on bank re¬ the banking system. Fortunately, native to crediit restraint is infla¬
serve
positions. As a result, the business began to expand again tion, and (2) that credit restraint
banks have soon resumed selling before this process went very far alone cannot be
expected to do
Governments and the expansion of but the portent for the future is the whole
job of stabilizing the
bank credit resulting from the fi¬ not too reassuring.
economy.
rates,

nancings has,proven to be.tempo-

There

rary.
In essence, therefore, the
bank<=! have acted as middlemen in

distributing

credit is less

would

How

the

be

susceptible to shrink¬

than it used to be. Bank loans
to be at least somewhat
less
vulnerable to decline than
appear

Banking

banks

con¬

age

ties among monbank investors.
How Credit Ease Affects

some

solation in the fact that total bank

Treasury securi¬

new

is, of course,

they

af-

years ago
should decline,

were

loans

v

fected by a period of business re¬
cession and easy money. To an¬

and if total
the Federal

In

certainly encour¬

.

of

1953

the

authorities stumbled

ac¬

the

well

supplied

with

that

assured

supply would
continue to be ample. Yields on

.

vinced

that

to

the red into the black.

how

the

tude

toward

help

being

serve

fact

influence

of

Federal

Re¬

policy

was reflected in the
total bank deposits and

that

total bank loans and

investments

actually increased during this pe¬
riod. The chief impact, of
course,
was

bank

on

investment policies.

The banks (used

ditional

some

to

reserves

of their ad¬

expand their

hoi dines of securities. With

lower yields prevailing
term

Governments,

ened

out

the

investments

they

maturities

on a

sharply
short-

on

length¬
their

of

substantial scale.

firmly

are

the

more

interest

rates

influenced

to

could
some

retard

the

rise

in

rates

At
first
blush, this situation
might seem to have ominous im¬
plications for bank earnings. This

namic growth, so the chances are

duration

There

liquidate bqnk credit.

was

our

periods of recession and

low interest rates will be of short

pansion

and

of

periods of

our

long

result

should

no

duration,

in

a

fair

ex¬

which

average

question,
of
level of rates over the years. Also,
course, that monetary policy was
the extent to which the Federal
headed in the right direction but
Reserve can retard rising interest
there was a question as to whether
it

was

perhaps being pushed too

fast and tod far.

Some of

us

who

politely expressed this view at the
time were politely waved aside.

rates

hold

when

down

it

the

is

determined

money

to

supply, is

Future

of

Monetary

com¬
years ahead, monetary policy will
continue
to
have
a
during doubtless
the ensuing boom. But does this major impact
upon
commercial
mean they would not do the same
bank investments, lesser but still
thing again? No one can say for significant
effects
upon
bank

.

growing

econ¬

''• "■

Offered at $1.25

a

Inc.

indicators

Sh.

lending, and, of




of

raise

Teamsters

course,

important

bears

;

no,

ingmen."4

to

Be

ler

strikes

affair.,' No

supplemented

]

witness the Koh- '(

one can

reasonably

\

of the simple
wages—the una- *
domed and pure concerted refusal •
to work.
But when violence oc- ;
to The

object

v*

use

strike for higher

social responsibilities of the "
basic kind are flouted, and
members .of; society "are op-.'

until ^certain ;curs,

most
-

Clean.

a

its

see:

with violence, as

Council'sus¬

corrected.]

are

that

two

the

v

x

•

all

-v

pressed.
Violence is in itself a
evil. In the usual case it ;
involves a physical assault upon 1

Unjou?

of Jersey City, N. J.

questions.

members

Assuming
the

of

entitled to have

sters-are

Team¬

persons

plea n

striking

ay

who prefer not to join the '
union in, the pursuit ofJ

its objectives—a preference which
par-,
Federation's condemnation of ■ is within the rights of every man
in a decently ordered society.
,
some
of the present Teamsters'

union, how effective will the
ent

officers be?

The Ethical

Committee is not
,

Heights, N. Y.; to pur¬
bowling alley at Great

stock, out of an

authorized issue of 5,000,000

shares.
Sports Arenas (Delaware) Inc.
was
organized in Delaware on
Sept. 30, 1957 for the purpose of
acquiring, constructing and oper¬

even

Eraqtices
IF is

Market

No Free

scratching,

the surface of that probleip.

...

-

"

,

3

implicit
beyond the

the''social wrong

But

enquiring into the qrgariiza-t in strike violence goes
interests of
the persons whose
methods of the Teamsters;
methods
which J' are largely - 'ag¬
physical integrity has been vio¬
gressive, compulsory, and:-ci3er- lated. Union violence is intended
not

tional

Nor is it

cive.

enquipipg iAtp :th'e

if

the

Teamsters

demned
one

by

should^ comply

th

rejecting

the union

precluded

violence

Committee/''can

the

more

willing to work; at less pay than
is insisting upon are by

*

' officers : con¬

e

wages
higher

costly than would be
forthcoming in a free market. Men
and

pressive and monopolistic; ^ Everi
by

to, and does often, secure
and
working conditions

■

operational techniques/techniques
which are for the most part ^op¬

society.

expect the resulting situation

from serving
consumers

Workers and

,

higher costs which
extortion exacts —
there will us¬
ually be less employment at the
else remains the same—what has
higher wages; the consumer be¬
been accomplished?
*
From
this
arises - the second cause usually prices will be high¬
Notwithstanding these un¬
question. Is the wide conqern so er.
evident today "with trade-union toward social consequences, I have
practice evoked/only by the. per¬ yet to hear the statesmen in the #
sonal
conduct
of
thepresent AFL-CIO s Ethical Practice Com¬
mittee threaten the expulsion of;
trade-union tdp:Teadership?r. Al¬
most certainly pot.
The focus of unions which use violence in con¬
concern
may '"' differ
somewhat nection with their so-called col¬
the

to

pay

for

this

form

officers

workers,

be materially
different?*
If
nothing changes except' the "top
of the Teamsters;'if all

of

because

.

ating

alleys,
kiddie cities and
amusement areas, at various
chain

a

skating
other

of bowling

arenas,

desirable
munities

sites

in

situated

suburban
near

the

com¬

larger

metropolitan cities in northeastern
states but principally in New York>
New Jersey, Connecticut, Mary¬
land, Delaware and the District
of Columbia. The company intends
to operate through controlled or
wholly owned subsidiaries, which
it may organize, or acquire in the
normal

course

of business.

from

the

one

true

concern

character '*'and

the

KANSAS CITY, Mo.—Rhoda L.
has joined the staff of
&

Co.,

1000

Baltimore

Avenue.

Burke, MacDonald Adds
(Special to The Financial Chronicle)

KANSAS

CITY, Mo. —Ivan D.

of

called collective

bargaining
-

-

.

'
M \

ion

conduct is

the same

a

It is an agency

considerable

today.

both

achieved

extent by coercion,
physical-ahd economic. Un-;
ion
organizers .sometimes,
sell
unionism to workers,. but ^ with
great frequency union member¬
ship is forced, not sold/ Mpst/often

the

coercion

nomic type.

is

of

the

socially harm¬

without

ends

thing to the true, pure monopoly
to be found in the United States

un¬

characterized to

achieves

having to use
violence—at least without having
to use it habitually. The industry¬
wide union is about the closest

Join

organizational stage

other tightly or-.
industry-wide union, it

ful

*

I"

Claims Members Are Forced to

In the

ganized

dustry or of any

proc¬

"
'.

•

position
automobile in¬

union is in the

a

UAW in the

of the

union organization and in the way
in
which unions act in -the so-

Silver
Bache

When

lies in

structure'

bargaining.

lective

but

to another,

person

basis of

(Special to The Financial Chronicle)

pointing effects upon rates of return and Rowe has been added to the staff
downward, »it is- probably only bank earnings. These effects will of Burke & MacDonald, Inc., 17
natural for monetary policy to err surely
confront
bankers
with East 10th Street, members of the
in the direction of excessive ease. enough problems to
keep life in- Midwest Stock Exchange.
are

which

.These findings and declarations, social

City and MacRobbins

common

v

,

Yorktown
a

Executive

.

Inc. at $1.25 per share.

chase

in

of unionization

desires of individual

to the

the

(Editor's Note—On Oct; 24,iJhe

Can There

James Anthony Securities Corp.

Co.,

country

necessary

Committee

clean union/-3

a

abuses

Sports Arenas Stock

&

structure

pended the International Brothei'-:
hood

of New York

eral

.

AFL-CIO

■'

problems

sure, of course, but when the eco¬

nomic

vigorously

our

With Bache & Co.
The

Practices

ess.

carried too far and that this

their

to have

'

obviously limited.

Management
Now, in retrospect, the Reserve
authorities have agreed that their
To sum up our discussion thus
easy money policy of 1953-54 was far, we might say that over the

pounded

con¬

tribute effectively to the stability

omy.

consequence

of these

this
of

declares, that/'thq
that monetary
1,400,000 members of the Tegmvicissitudes, *;'wiU|: ■sters Union want and are entitled

survive and will continue to

during shares of

periods of active business.

Ethical

,

of

I

and

despite

Neck, N. Y.; to purchase land at
also by the magnitude of Stamford, Conn.; to acquire and
the public debt. In any event, the build
bowling alleys at Brewster,
experience of recent years sug¬ N.
Y.; and for working capital and
gests that the Reserve authorities other
corporate purposes.
.../ ''' /
will probably accelerate a decline
Giving effect to this transaction,
of rates during a recession and
there will be outstanding 540,000

bank

pressures to

future

the

such '

.

ogy and

that

forestalled possible

in

policy,

j

and}*

of the wide i
coercive methods, as
have elsewhere said, "is a gen¬
The

use

the Committee

degree by the prevailing psychol¬

freely than during the first part
of
1953.
Ready
availability of
reserves

out¬

even

would be
so
if our periods of
some effect on
recession and recovery were to
lending policies. Although be of equal duration. However,
declining business tended to make the United States economy is now
bankers generally cautious,
many enjoying
another epoch of dy¬

somewhat

the

the .recent

of the AFL-CIO in respecLto

will depend upon the intel¬

policy. Indeed,

bank

loaned

analysis,

this

methods today.

pushing other people
action

AFL-CIO.There y

a

relationship whatsoever.;
workFurthermore it /leads ■
Teamsters Union. ^Findin^ some
to
union practices which cannot/
Teamsters officers guilty of'"cor¬ be reconciled with the free marrupt activities offensive to trade ket upon which we rely, as con- >
union morality,"
the '.committer sumers for protection, from'mo-",
has in effect recommendedvthe nopolistic oppression,. When a un-;,
ouster of the Teamsters \fropr the
ion does .not have -the strangle-Federation, unless in the-forth¬ hold upon -an entire industry that
coming election the offending of¬ -the
Auto Workers have in ; the v
ficers are rejected;: "We. think;", automobile, industry, it is common jthe

cent) of Sports Arenas (Delaware)

There was also

banks

Consider

Ethical Practices-^

large union in
country which has not used
is not using one or more
scarcely

is

•

in monetary
The net proceeds from this fi¬
it is hard to see nancing are intended to be used
Federal Reserve's atti¬ to
complete
bowling alleys' in

extent

some

private

any

of

Committee of the

around.

are
offering publicly 240,000
of shares of common stock
(par one

This bias appears to be reflected

satisfactorily
when
association force

out

refrain from

Today, however, there is a
danger that monetary policy
may become a permanent partisan
political issue. This admittedly
might limit
its
usefulness and
even jeopardize its very existence*.

that, ,
characteristic,,'
unions which have felt

only

work

sponsibility of trade unions is
nothing more than the obligation

con-

level

present

interest rates is very high.

short-term Governments dropped
precipitously and rising bond
prices shifted bank portfolios from

The

monetary pol¬

new, of course.
Credit
always arouses opposi¬

last

it must be understood

social point of view

a

tion.

the

over,

the wrath of the

not

real

In

are

do

■

come

these

such conduct is not

compulsion make up the com¬
mon modes of operation.
To put
the matter briefly, the social re¬

money

Americans

most

and

reserves

the

pulsory

and

standpoint,

cidentally into an easing of credit
partly because they had permitted
the money and capital markets to
tighten too suddenly and partly
because they had to help the
Treasury with a large financing cies in the United States show a
operation for new money. When strong bias in favor of low inter¬
they finally decided, however, that est rates. This is partly a reflec¬
the bloom was off the boom, they tion
of
the
long
period
of
proceeded to push easy credit with extremely
low
rates
that
messianic zeal. Their aim was not developed
during the Great
simply to make sure that credit Depression
and
was
artificially
was
readily available at reason¬ prolonged throughout World War
able rates; $hey were intent upon II.
Although, viewed in longer
really pumping reserves into the historical perspective, interest
rates
in the United States today
banking system and actively en¬
couraging ;an expansion of the are clearly still quite low for a
boom period, and especially when
money supply.
with other countries,
The ban'ks found themselves compared

unionism agreements —
the most usual methods
of forcing unionization upon un¬
willing employees and employers. ,
Outright violence is used when
economic coercion fails.
Those
who
doubt this are simply un- *
aware of what is going on.
More-:

be

have already referred: that things

in

ligence and common sense of the
supply. From this
American people and their elected
the banks are in a
representatives. On issues of this
much better position than former¬
kind, our past record has been
ly, but this will not protect them
by no means perfect, .certainly,
from a sharp decline in the aver¬
but on the whole, quite good.
I
age rate of return on their assets.
believe it will continue to be good
Public attitudes and public poli¬
of

to

of union members and officefs-to

look

us

May and June

Reserve

icy is not
restraint

not

from

.

would

Reserve

age
the banks to expand their
briefly at holdings of Government securities
what happened in 1953-54.
to prevent a serious
contraction

this, let

swer

reaction to

This

eting,
hot
cargo
contracts,
blacklisting, secondary strikes and
other kinds of boycotts, and com¬

responsibility

"trade-union

Treasury issues and the addi¬ implications for commercial
You
have doubtless heard of
reserves required to finance
banks. By early 1954, though ag¬ the storm of opposition that has
these acquisitions have come in gregate
spending
had receded developed in the United States in
part from Federal Reserve open- very
little from its peak, the recent years to rising interest
market
operations and in part Treasury
bill
rate
had
been rates and so-called tight money.
from
increased borrowings by pushed below 1% and the discount
Also, over the past year living
member banks from the Federal rate had been reduced twice to costs have been
rising and this
Reserve. The willingness of banks 1%%. Such a policy, if continued has shaken confidence in the ef¬

these financings without requiring
the Reserve banks to relax appre¬

"public

of trade-union leaders," and even

tional

to borrow for this purpose has en¬

6

page

management

new

abled

from

Compulsory Unionism and
Responsible Unionism

.

the assumption, of

on

that

course,

monetary

substantial

on

better-thanunder modern

a

monetary management.

again the banks have Credit Ease Hurts Banks' Earnings
amounts of
This
obviously has important

Time and
taken

and at
level,

subsistence

Continued

satis¬

a

inelastic.

tively
in

virtually exclusive
resource—human la-which demand is rela-.

of

bor—for

economics

these

Organizational pickr-

which has

through coercive

and has

means

control

eco¬

power

are

Any good
explain

will

text
that

the conditions necessary
*

_

3 The
p.

21.

New

York Times,' Sept. 19,

1957,

'

'

4

the

By

the

Free

author,

Society,

p.

The Labor Policy
112 (1957).

of

Volume 186

Number 5690

.The Commercial and Financial Chronicle

..

(2127)
to

the

kind of social exploitation

associated

highly

with

monopoly.

doubtful

mercial

that

It

any

is

com¬

industrial firm in this

or

country possesses the monopoly
characteristics necessary to ex¬

ploit consumers. We have reached
a
stage, of complex competition
such

that the

demand

for

almost

every consumer good imaginable
is elastic to a considerable de¬

is the situation

which

course

the

this

and

gree,

materially

of

power

of

reduces

business firm,
however big, to exploit consumers.
any

enroll.

ently.

union's
a

'

It

is

true that

human

labor

as

can

get

duction

the
a

of

means

for

pro¬

in specific

tolerably elastic
instances; men in spe¬

cific

can

jobs

placed

to

chines.

But

things,
in

the

extent

in

the

demand

over-all

an

sometimes

some

be

re¬

by

ma¬

nature

for

of

is hard to believe that the
right to
laws are designed, as is so

different kind of

on

the

to

act

work

differ¬

often

the consent and

probably

solicitous

more

tended

"It

compulsory

organizations

know

now

they

will

which

probably

run

in

their

op¬

to

be

an

better;

and

eration

are

defects

likely

corrected.

tant than that,

position

a

More

is

sense

final, ultimate,
relatively inelastic—relative¬
ly, that is, to the demand for spe¬

will be the

material

goods.

And

when

union has secured control of all
the labor in a broad
a

industry, and

keeps this control in the

iron

grip
of force and
compulsion, society
is faced with true
monopoly pow¬
er.^ No
better example of such
power is available than the United
•Automobile Workers.

And

no

it

is

necessary to

policy

of the

or

right to work

or

^x|M

condition

a

shall

No Intent to "Bust Unions"

have

the right-to-work laws.
reads

law,

text

the

the

of

Indiana

the

would

r

HU<
Harry f. Byrd

law

of

it

intent

One

we

destroying

upon

trade unions would

additional

if

President

be

can

doubt

no

are

and

non-essential

some

fields."

little

a

—

reduce

Senator

are

some

scarcely frame

all

union morality overlap

at certain
Both apparently condemn
But. it is evident that a

■stealing.

good many things in trade union
practice which offend ordinary

people seem inoffensive, perhaps
even
laudable, to those guardians
pf trade-union morality, the mem¬
bers of the Ethical Practices Com¬
mittee of the AFL-CIO.
and

physical

coercion

Economic
in

the

or¬

ganizing process, and violence and
monopolistic pressure in the bar¬
gaining process have never been
the

preoccupation

the

Committee.

particularly
•members

right

a

if

the

unions,

is

in

that.

of

The

to

or

RESULTS OF OPERATIONS

<y>W

have

Operating Revenues

limit

Operating Expenses

compelled to

m

0

0

9

9

0

9

Depreciation and amortization

9

0

0

0

0

General

Federal income

The

Corrective

right-to-work laws

served,

As

they

I

have

offer

industry-wide
unionism,
variety of forms which
right-to-work laws do
not

the

to

go

which

the

of

causes

currently

pre¬

ditions.
There

is

of

that strictly

always be

course

guaranty

no

voluntary unions will

run

well

that

or

they

will never pose the grave dangers
to
the
market
economy
which

present

industry-wide unions

posing. Yet, when

present-day industry-wide unions
have

achieved

through the

'economic
ment
one

their

position

of force, violence,

coercion,

assistance

may

;the

use

and

and

reasonably

govern¬

connivance,

believe

that

elimination

of
those
things
help to bring about a health¬
ier state of affairs. A union which
may

is

the

free

and

uncoerced

choice

of its
an

membership is certain to be
organism essentially different

from

an

compelled

organization

unwilling

which
persons




775

1,198

1,403

4,955
4,!

9

3,184

137

879
1

0

9

$
$ 8,397
8,397

$
$

8,009
8,009

$33,543
$33,!

$32,500

Operating income

0

0

0

0

0

$
$

2,615

$ 2,240

$10,065
$10,1

$

8,724

$

43

$

70

$

$

52

$
$

66

$

344

$

2,667

$

2,306

$10,352
$10,

$ 9,068

$

903

$

$ 2,684

taxes

0
9
0
0
9
..........

taxes

9

0

0

0

0

230

—

—

4*
^

9

other income

income

56

98
$

287

1

**

t,

,

«

/

"1
1

,

-

-

first mortgage
expense

charged

to

bonds
.

construction

728

$ 3,296
3,!

164
164

12
12

444

142

368*

71*
71*

1,<
1,054*

377;

4*
4:,s

Other

1

'

on

interest

28*

1

27

Total income deductions

$

695

$

670

$ 2,658
2,<

$

Net income

$

1,972

$

1,636
1,63
6

$ 7,'
7,694

$ 6,592

216
216

j
860

1,420

$
$ 6,834
6,i

Preferred

216
216

Dividends

has

to

2,476

860

mzmM

Earnings

i

on common

Common Shares

$

shares

outstanding

at

Denotes red

S
S

end of period

$

2,651

2,651

$0.66

$0.54
S0.54

s

2,651
2,<
S2.58_$2

figure
This is
time

its

an

interim

financial

statement.

The

statements

are

COLUMBUS AND

Company's fiscal > ^ar ends December 31, at which
by independent public accountants.

examined

SOUTHERN OHIO

215 North Front Street

5,732

~

(in thousands)
EARNINGS PER COMMON SHARE
*

1,756

are

realizes that

one

0

0

Interest

1

/

'f' *'

iiil

'

0

0

Other

-

occupy us; they do not divert at¬
tention and energy to the super¬
ficial results of basicaly bad con¬

0

3,130

0

Interest
V

-tions of the Ethical Practices Com¬

conditions

0

8,738

4,761

Income Deductions

Nevertheless, the right-tolaws, unlike the fulmina-

mittee,

1,226

Total operating expenses

Gross

a

reach.

1,273
947

$ 6,673
6,
9,338
9,
3,
3,153
5,012
5,<
3,533
3,!

$ 6,412

767

2,149

5,783
492

Total

gerous

work

$ 1,552

711
'

Transit Company, less expenses
reserve for deficit of

corrective; compulsory
unionism, leading to socially dan¬

the

$ 1,707
2,331

Transit Company
Other

mentary

takes

$41,224

Reduction of

frag¬

a

$43,608
$43,

Rentals, dividends and interest income from

already ob¬

only

$ 10,249
$10,249

Other Income

to¬

are

day the most striking responses of
•society to the threats posed by big
unionism.

taxes

Deferred Federal income

required.

Fragmentary

1956

1957

$11,012

'

that something more than
help of the Ethical Practices

A

•

9

9

the

is

•
•
•
•
......

f

•

Maintenance

clude

Committee

production

Other operation

con¬

!•••(

•

Fuel used in electric

interest

are

ended September 30

1956

(000 omitted)

responsibilities of trade

we

For the twelve months

ended September 30

1957

they will. How¬
is in fixing

as

For the three months

nothing

Committee

broaden

our

the social

concern

There

wrong

of

to

their interests
ever,

or

domestic

Harry F. Byrd.

strongly in favor of reducing "spending in

non-essential domestic fields."

ordinary morality and trade

points.

spending

puzzled about "the pattern of

or¬

at

Eisenhower

Congress

during the 19th century, has ever
building up
and
exercising monopoly power
more sihgle-mindedly, more skil¬
fully, or more ruthlessly.
V- >
There

expenditures

in

gone about the job of

.

Con-

just follow the pattern of

ganization in this country, includ¬
ing
the. Standard Oil Company

that

program

sure

appropriation reductions made by Congress," but

organizations. ..."

such

1957,

We

assisting labor

or

am

appropriation reductions made by

'

joining, continuing

membership in,

When one
latest

"The

budget

the

assist labor organ¬

from forming,

additional

would not have to unbalance the

equally have the right to refrain

Such, I think, is the rationale of

an

do in that particular field.

BMM

to become

izations; and that employees shall

gainer.

law.

will do what it is asked to

gress

to continue in

or

employees

or

a

non-

labor organiza¬

a

appropriate

going full blast, I

*

and

cific

public

membership

bership in,

to have such

$2,000,000,000 to get this

right to form, join, continue mem¬

and in that respect society

power;

"If

coercion.

right of self-organization and the

monopoly

exert

sary
for
its
own
preservation
would, I believe, be well advised

On the Right Track

as

coercion

the employment of any employer;

more

impor¬

they will not be in

to

the

employee of

that

speedily

choice

employer

tion shall not be made
to the

be

On the other

tightly drafted to

employee

membership in

trade unions. As

as

law in such terms.

specifically in¬

trade-union

that

giant

the

of

labor

is

state

than

unions."

a

hand, a free society intent upon
expressing the conditions neces-

The Indiana law declares that:

likely to bo"smaller and less
dispersed

"bust

are

are

free

against

as

Strictly voluntary unions, again,

widely

to

against

honest

more

in relationships with its members.

are

and

protect

and

much

great deal

a

charged,

All these laws

the

membership,

leadership is likely to be

great deal

such,

demand

a

likely

Resting

•

volition

we

True Monopoly Exists

Being

it* is

thing,

•

ELECTRIC COMPANY

Columbus, Ohio

27

2,651
$2.16

j

23

The Commercial and Financial Chronicle

(2128)

Continued

from first

\'As We See It
to

military

affairs

of

uses

The

Were

men.

problem, the
derision, and
make

science, the application of pure science
and in the longer run to the economic

certain

this

becomes

denounced

could hide

we

of

clearer

when

one

the

work

of

as

From Oar
costs

minds
engaged in other things as
warped

wells must
be drilled and to greater depths;
and
lease
operating costs will
keep on their upward trend.

the

competition of other peoples or even from destruc¬
by them. Another indication of the nature of our
position is found in the fact that so large a proportion of
the scientists who have kept us abreast—and until re¬
cently ahead—of most other nations are of foreign birth
and training.

tion

A

We

toward

vides

this

alternatives

two

either

income

as
a
people have developed a strange attitude
intellectyialism and toward science in particular,

permeates the body public pro¬

prices or by cutting down
penditures
per
unit of

our ex¬

Since

the

we

are

the

best

tures
the

much

as

But

they have

continued

good

a

at the

those

and

—

the

where

areas

possible. One of
to reduce expendi¬
reve¬

same

velopment methods.

These

be

can

accomplished

primarily by more
and
technological ad¬

research

vancements.

Expenditures in the oil produc¬
ing industry are essentially di¬
vided between its

exploration and

producing functions.
of these

lent
cal

Fortunately,

fields

offers

excel¬

opportunities for technologi¬
progress.

search,

re¬

have made great prog¬

we

in

ress

subsurface

recording

analysis

improved

techniques such

and

seismic

magnetic tape

as

variable

and

intensity
film interpretation. The geologists
and
geophysicists have been
working closer together than ever

to go still for the most part.
which will assuredlv keep us

before

continued probing into nature's
probing cannot be limited merely to
practical results can be foreseen.

in

considerably

requirements
will

also

reduce

investments

and attendant facil¬
Operating costs may be fur¬
by improvement in
lifting methods, workovers, and
in stimulation techniques.
tankage

ities.

ther

reduced

Petroleum

searchers

and

engineers

toward

standing
types of
where

of
oil

they

However,

better

a

the

under¬

possible

many

accumulations
are

more

likely
and

to

and

progress

methods

efficient

of

occur.

better

re-

search

natural

has

servation

sions

the

and

tive nature of
leads

often

resulted

the

But

work.

land

course,

the truth of all this

well recognized
of the day, as attest the
is

progressive business men
now spent for abstract research and the gen¬
erous
contributions to various types of institutions for
this purpose.
But such recognition of the need for re¬
search and even
willingness to pay for it will not alone
provide the solution. Already there is a dearth of able,
well trained scientists.
It is, moreover, evident
enough
that the necessarily
dwindling existing supply of such

among

sums

able to follow the

were more

same

practices at home, we would ap¬
preciably lower our producing
costs per barrel.

Unitizing Results
Last year in

the state of Texas,

for example, 13,082 oil

completed.

Had

wells

were

doubled

we

our

well

spacing, we might have re¬
duced
expenditures
by
some
$360,000,000

saved

and

addi¬

an

is not

men

being replenished in the degree needed.
Many have in recent months and even years

forward
.

,

with

varied

"programs" for correction of this
state of affairs. These proposals usually deal with the
organization of our school system, alterations in the course
of study offered, the allocation of greater sums to the
education of the youth, and various schemes
designed to
make it easier for students to turn to the
study of mathe¬
matics and science.

for not

ness

liberally
factor

as

in

course,

Some observers add criticism of busi¬

rewarding the scientist

or the engineers more
compared with the salesman or some other

the

who

production of goods.
seem

to

feel

that

There

the

are

infirmitv

training is expensive, of

course,

need for rearranging the

courses

secondary schools, colleges and universities.
fundamental than all this is,
are to
move ahead
vigorously,

more
we

tively in this
Somehow
our

we

We

our

find

strati-

be

may

of

geo¬

our

oil

new

not

must

only im¬
finding tools

existing

but, in addition, evolve completely
new- approaches to
oil finding to
increase our wildcat success fre¬
reservoirs

the quality of
discovered.

materially reduce the

per

cost of discovered reserves,

is, of
•

course, our

have saved

ducing

industry

the

in

talk¬

develop

oil

U.

the

and it may

while
S. pro¬

order

of

$130,000,000.

matter
shall

of

have

digging
to

make

There well

of study in

Something

however, required if
steadily and competi¬
into nature's secrets.
drastic

alterations

in

thinking about science and scientists^ honoring them
scorning them, rewarding them rather than

rather than




we

see

that it

covers

a

broad
range of industry activities. These
include research

those
not go

13,000 wells in Texas .did
to increase our production,

chance

in

drilling 10% fewer dry holes. This
would

entire U. S. industry's cash
expenditures. We should also con¬
sider that the drilling of many of

a

could

be

the

already drilled.

am

and

have

reduction in

like the farmer who turned down

same

of

would

5%

a

rating the production from wells

us

discover

alone

which

.

amount

Texas

brought about

year.
Or,
this saving

barrel

ing about has impressive dollars
and.cents value.. Suppose we had
been able .to improve the effi¬
ciency of our geology and geo¬
physics in 1956 by enough to per¬
to

in

way,

but rather resulted in further pro¬

objective.

The kind of research I

putting it another

oil

New Type of Research

•

barrel of crude oil

produced in Texas last

will

new

This

Turning to production research,

might be.

a

prove

oil.

for

the'

well be that the financial rewards of those who follow its
arduous course is not as large as it

be

physical methods to
graphic traps which
most prolific source
reserves.

crude

mit

learning.

f
Scientific

of

exists

those, of

quickly cured by the application of huge public funds to
education in public schools and other institutions of

may

cents for each

heed

quency and

come

tional

and

accumulation

very

lease operat¬

drill them

to

In

take

a sense we

a

college

are

course

scientific farming "because

already knew how
better than he

We

where

was

excuse

can

to farm

he

lot
farming now."
a

ourselves in

areas

haven't found the right

we

.;
Better Drilling

made

have

We

decade.

cient

units

for 'drilling

rate

improvements.

constant

obtained

the

through the

use

be

the: rotary drilling

sure,

however, there is no insur¬
mountable reason why we cannot
able;

develop

hew and

a

000,000 in trying to find ways to
this work faster and cheaper.
This is less than one-tenth of 1%

do

of total

expenditures. In

many re¬

spects today's drilling methods are
the same as those we were using
the

in

should
S.

U.

1900's,

early
be

a

a

fact which

constant challenge to

producers.

It

.

plain

seems

that future drilling research must

increasingly examine the charac¬
materials

of. earth

teristics

the most efficient means of

and

bring¬

ing about rock failure. We must
also
work on concentrating the
necessary energy so

est

plished.

is

accom¬

'
completing

;•

>

.

.

cost

The

that the high¬

of penetration

rate

of

.

'

both

dry holes
has increased even more rapidly
than the cost of drilling. This is in
wells

productive

spite
tion

and

of progress in pur comple¬
practices through ^develop¬

ments such as multiple zone com-

hydraulic - fracturing,
permanent;type. well completions,'
reduction in casing requirements,
use of portable work-pver rigs to
eliminate stationary derricks, and

.pletions,

new
testing, cementing and per¬
but I do think we should
forating
devices, y- T he s e
new
better
advantage of
methods haveytended both to keep
what we already know.
our
costs down and to increase
Secondary Recovery
production
aridX reserves;
they
In the field of secondary recov¬ have actually enabled us to com¬
ery
information is also accumu¬ plete as producers wells which a
lating which, if put to proper use, few years ago; would have been
could result in enormous benefits
dry holes.

be

taking

.

to the nation and to' U. S. oil pro¬
ducers.
You
are
familiar with

estimates

which

indicate

that

of

then,

These,
main

areas

need

for

in

place

ultimately

be

more

in

known

States,

able

to

reser¬

will

are some of the
where there is urgent
research

we may
recover

than one-third with

known

techniques

with oil at its current price.

and
It is

application
to

try

new

stantial fraction of this

failures

would

grams

of

far
the

more

than

research

return.' the

required

to

approaches

the

producer
The answer to
making full

our

technical
willingness
without being

our

ideas

afraid of failure—because

quently

cost

of

knowledge and in

apparent that getting out any sub¬

oil, which

bring

all these needs lies in

ment

equip¬
metering facilities. In
well as other states, arid

efficient

year,, our

industry will spend less than $5,-

cesses.

as

more

method.1 > This

drilling

will otherwise be left unrecovered

and

im¬

from

system is simple and highly adapt¬

of automatic lease transfer

Texas,

of

answers,

presently

good possibil¬

terms

producing.industry.':

To

-

scarcely

a

In

proved technology have been off¬
set by deeper drilling, but still the
very fact that there has been this
offset has represented savings to

practices—all

reduction

<v

dollars, jthe;-benefits that

been

have

po-.

for V further y' penetration

greater efficiency.

of

Air

experience, 'suggests.;

drilling
tential

inally

ity

goods,

and bits have been improved.

voirs of the United

expenses,

offshore.

■

components,/, tubular

Rig

methods, reservoir behavior
performance, secondary re¬
covery,
drilling, and completion

for example, offer

during' the

We are now using
lighter, more portable rigs. . We
are
skidding rigs wherever pos¬
sible; and have1 developed4 effi¬
past

and

mize recovery
Our lease operating

'

great strides in

technology

drilling

ing

maxi¬

in¬

dustry."

which

designed to
and profit.

To drill

cheaply.

cheaper is vita! to

the 290 billion barrels of oil orig¬

on

two

are

dry hole

drill fewer wells

more

wells

the

maximum extent and drill

efficiently produce a field at
optimum economic rate. If we

an

there

—

decrease these

to

costs—either to

intensely competi¬
leasing activity
excessive drilling

to

com¬

to developYhe same reserves or to

These difficulties can
be and
are
being overcome by
unitization in a large number of
instances.
In foreign operations
where large areas are leased by a
single lessor — the government—
and where such areas usually are
developed by single companies,
we are able to use our knowledge
the

is for the
This sum,

expenditures

locations

better

this

most

find.

we

excluding the cost of

ways

practices.

to

other

pletions, represented about 20% of
our total producing expenditures.
Half of the drilling costs may be
laid to dry holes; and—aside from

divi¬

standing of the source, migration,
Particular

when

our

to

recovery,

and

actual drilling of wells.

con¬

from

small

oil

in

burning,

largest single item of pro¬

ducing

The

energy

$10,000,000
per
year
in
operating costs. This total saving
would have been equivalent to 35

will

Of

large

programs by the industry
further improve our under¬

The

supplement¬

devices.
whole concept of modern oil

ing

'

More Is Needed

the oil

re¬

remarkable

made

have

the minimum number of wells

Looking first at exploration

ahead will depend upon
secrets

ways

expendi¬

our

price level — is
through
improved
finding
and
more efficient producing and de¬
nues

way

progress

find

to

as

best ways

correlations,

but

reason¬

tures—and thus increase net

making full use of existing
knowledge in the production and distribution of the good
things of life. There are others who are catching up with
us

is

answer

and means to reduce

still far in the lead in

experimental

an

the approval of local

producing reservoirs; and the most

economic

We

are

basis, with
conservation
regulatory
bodies.
Wide¬
spread adoption of automatic sys¬
tems will not only reduce man¬
on

water

approaches to be worked on will
bring us closer to the ultimate
goal of producing substantially all

and

continually rising prices, certainly

potential

idle

numerous

are

limitations to

maintaining

each

be

course,

ad¬

able prices for consumers, and of

merely to blame the
younger generation for this state of affairs. It would be
unfair and unrealistic and certainly quite unproductive.
The blame must rest upon us all if presently we find
ourselves underlings in the march of human progress.

of

output.

of

aware

there

solvents

of

use

in-

maintenance,

pressure

underground

in the field of reservoir
engineering...They haye acquired
knowledge about the proper spac¬
ing of wells; efficient methods of

in

vantages

youth of the country with an added incentive
for shunning the arduous tasks which mastery of mathe¬
matics and science requires. Traditionally we have beermore interested
in practical things than in those which
are
commonly termed "theoretical" or academic. More
recently our educational philosophy has turned more and
more to
vague generalizing about current events which
is supposed to "educate" the youth and make them "wellrounded" citizens. Despite the fact that more and more
evidence is accumulating that the future belongs to those
nations whose peoples master nature best, and notwith¬
standing that those who master nature best must devote
long and arduous study to what is known as science, there
is a serious, not to say alarming reluctance of youth to
seek the training required for careers in these fields.
would,

We can raise our
through
higher

ducing industry.

the

It

to us, there are
facing the pro¬

being presented

techniques, par¬

research

Continued

flooding,

automatic systems now operating

but

circumstances

of

set

Canada

in

power

Alternatives Facing: Us
With

Strange Aititude

that attitude which

and

are

difficult to find; more

heads in the sand and be safe from

our

by primary means was 200,-

barrels, or 50% of the oil in place.

Untapped Oil Reserve

climbing; sizable oil re¬
becoming increasingly

are

servoirs

ery

ticularly water flooding, will in¬
crease
oil recovery to 400,000,000

Land acquisition

continue to rise.

nuclear

hears

example, indicated oil recov¬

ondary recovery

3

Achieving Greater Efficiency

our

"egghead" would not convey such
so many of our youths would not so often
that they do not become an "egghead."

which would have been better
if

nature

term

situation

discoveries

basic

the

not

Illinois,

of

Field

Loudon

for

000,000 barrels, or 25% of the oil
in place.
The application of sec¬

Continued from page

the matter of pure

method.

recovery

new

a

the

In

behind.

Kremlin and those who do its bidding in

ahead—of the

evolve

begrudging them what we must pay them. We must
somehow pass on this new spirit to our sons and daugh¬
ters. Otherwise, no matter what else we do, we shall fall

page

1957

.Thursday, November 14,

..

learn
as

we

as

we

much from

do

Revitalized

from

fre¬
our

our

suc¬

research

pro¬

and new blood to help them
certainly result in greater

fvill very

Volume 186

Number 5690... The Commercial and Financial Chronicle

(2129)
returns for the
ments.

industry's invest¬

' *•-

-

;v\;-v^v-

-

,

•

\Vhose;Eespensibility?

.

Probably -one of the big ques¬
tions before the producing indus¬

points,

there is no doubt that
crude oil imports into this country
reached too high a level.
I

-

try is. "Whose job is it to carry
this

out

present

essential

research?"

At

than 60 % of all the

more

think

it

is

unfortunate

imports reached such
a

result,

into

our

the

By JOHN DUTTON

It
and
in the United States is performed* wisely, this did not take the form
Time and again I have observed
by 30 major oil companies, and it of government control. I regard
this as a sign of confidence that that
many
salesmen
seems logical that the real burden
(including
for research in this field should each importing company will rec¬ myself) will say, "Oh, that fellow
is
not
in
the
fall on them. The major companies ognize
the
market, there is no
importance of this
have also undertaken the largest problem and act accordingly. But use calling him on this new issue",
share of production research to I think it is quite clear that no and we pass him by only to disdate, but it is the responsibility one can expect to continue to en¬ cover later that someone else got
of the industry as a whole to par¬ joy
this confidence unless the the order we didn't think it worth¬
ticipate in and to help supply the problem is handled in a manner while to try to obtain. I had this
*

necessary effort.

Also, in the field

qf drilling it is obvious that it is
the producer who stands to gain
the most by reduced drilling cost
—not

the

manufacturer

of

consistent

with

the

guides
gested by the government.

sug¬

demonstrated

To my way

the

conclusively

last

week—-on two counts.

All Producers Are Affected

After

several

months

of

con¬

perative that each individual and

to aid the

industry.
The Federal Govern¬
ment already has a foot in our This sounded
very convincing, so
back door by way of the Supreme that
subsequently when two very

processes
one

to

see

able to the

that when

new

developed

are

company

small—that

a

It is up

common cause.

us

or

by any
group—-large or

they be made avail¬
industry as a whole on

reasonable

basis.

Eight now ' the total money
spent in all phases of exploration
and

production research is only
about $40,000,000 a year, or less
than

one-half

We

money

technical

of

with

effort
or

year's

,be

relatively
compared

economic, social' and defense im¬
plications for the public that I do
not believe We have any choice
but to mount a larger and more
comprehensive oil industry re¬
We

effort.

other

forms

laws of economics

can

of
or

be certain

energy, the
some other

outside force will act upon us
do

we

not

creative

press

research

Certainly

if
with

forward

open
soon

it for them—our house will
no longer be our own.

Too

often

in

what the U. S. producing in¬
dustry has accomplished to date.
If the same spirit of bold initia¬
tive which is a major characteris¬
tic of the oil producing business
can be
generated in the field of

research and technology, and thus

improve recovery and efficiency,
America's oil producers will have
come a long way toward meeting
their full responsibility to the
nation.

Actually the need is more
than a social responsibility—it is
a sheer economic necessity.

lem

the

offers

from

I would like now to
supply situation — a
subject which I know is both in
and on your minds. The industry
is presently suffering the pains of
oversupply. We have been aware
of it in all directions. Texas has
had to work to a 13 day allowable

able
seen

month and

a

12 day allow¬

for two months; we
have
purchaser pro-rating and all

of its attendant headaches in

eral

areas;

inventories

sev¬

too

are

high and the industry's cash gen¬
eration too low.

As often happens at such times
have lost ground in public es¬

we

teem—ground

ingly

which

difficult to

essential

to

have

talked

and

is

increas¬
and

recover

if

we

are

prosper as an industry.
I think that our present

is
to

over-

supply problem has its roots in
three things. First, the consump¬
tion of oil in this country this year
has not fully kept pace with ear¬
lier estimates. Second, we prob¬
ably did not readjust our output
fast enough following the reopen¬
Digitized
ing for
of FRASER
the Suez Canal. And final¬

ly, considering these first


two

good

a

other

several

Suppose for

directions.

moment that the
government were to decide to exr
a

ercise full control

said

he

relations

our

economic

and

on

ties

with friendly nations.
set

To
eral

the

would

future

have

demand

to

for

This could well lead

the government into inquiry into
the how and the why of certain
end
to

uses

of oil.

inquiry

It could also lead

to the relative share

as

of

financial

dition

and

economic

con¬

the domestic producing

of

The price

industry.

of domestic

crude oil could be a matter of ex¬

haustive
tion.

A

government
investiga¬
next step might be at¬

establish

to

government

of production

between
the several oil producing states.

else would be playing two
expensive
games — poker
and
politics—with our money.
I sincerely believe that it is in
of

our

nation and

of

for granted—but be tactful about it.

variations of
this procedure and it pays to try
and not take anything too much
for granted in this
business.
I
many

With Reinholdt & Gardner
(Special to The Financial Chronicle)

ST.

Robert B.

LOUIS,

Mo.

ders because I did not make my

Werner, Jr. is

now

telephone call

Reinholdt & Gardner, 400

have

lost

soon

bank

or¬

enough, and

obtained other orders be¬
tried.

I

cause

sizable

some

Creating

sales

—

affiliated with

Locust

Street, members of the New York
Midwest

and

is

Stock

Exchanges.

Douglas Aircraft head
,"V '

'

<

'

<-

*

,

>»

V

<

tells how missiles

something exceptional in
that category to show it to him.

attractive

bonds

offered

were

communities located in

our

state

I did not think I should
a

call.

After

give him
all, the man told me

clearly that he wasn't interested
(I felt that I might annoy him by
not taking him at his word). Just
last

week

another extremely at¬
was offered within

issue

state

and, since it

was

shape America's future

by

priced

right, I decided to take a chance
on the telephone.

Overhead another Russian satel¬

Find out how many

lite streaks at lightning-like

in each

speed through outer space. How
did these Sputniks get there?

and how many

By rocket-powered missile-the

dends unchanged

exclusive

vital subject of an

ar¬

At

a

was

in

thousand miles from

residence)
were so

and

he

a

city

our

over

mutual

thought

they

attractive that he decided

about this unusual turn of events
was

that this

man

is the long time

a

thousand miles from where

both

we

live, and I am the fellow
who is trying to obtain some of
now

But it does prove a

point—when

I mentioned that the reason I did

not offer the other two local issues

that

was

he

emphatically

had

more

bonds in this state PROVID¬

ING THEY ARE OUTSTANDING

VALUES." Sometimes people say

things in all seriousness one day—
and a month later they either for¬
get

it,

THEY
AN

or

change

WERE

EXCUSE

a

ONLY

policy,

OR

OFFERING

Sputnik" Donald Douglas ex¬
plains the real significance of
the Russian satellite, tells how
our

armed forces

Not Out of the Market

the
in

and then takes a

look ahead at America in an age
of rockets

...

to science and

what it will mean

industry and how

everything from
our table to the size

the food

on

information

since

the

yourself

for

the

amount of the recent market

de¬

cline with "sell offs" in the

past.

Magazine

con¬

exchange

trasts

eight' specific periods in
stock market history from
November 1929 to the present.
This important

Sidelight to com¬
analysis is just what

mon

stock

you

might expect from the
Magazine-just what

affect

will

it

exchange

of

our

cities and towns.

Supplementing this look-ahead
is a spot check on how the recent
commom

readers want, too.

How

These two

reports illustrate the

comprehensive coverage of ma¬
jor

shaping

developments

our

that you will find in
exchange Magazine. Along

economy
the

with other articles
pany

diversify?

by top

com¬

officials, financial column¬
analysists, they explain

buying

a

stocks in different industries

program.

But the exchange

Magazine asks: what about the
small investor

If

issue

In

the

to

Industry by industry, the
exchange

Magazine shows how

companies listed

on

the New

York Stock Exchange

piled

up

they diversify?

ment Trusts'."

won't

article
Cash dividends set new record

can

you're wondering, you'll want
read "One Company 'Invest¬

You

...

the person in¬

through the Monthly Investment

why the exchange Magazine is

alike.

or

vesting only $50 or $100 a month
Plan? IIow

investors

—

wise investment

is the key to a

ists and

popular with new and experi¬

diversification
number of common

Some experts say
—

program.

small investor

can a

stock of 14 listed com¬

panies engaged in the missile

same

issue, was to pass him by. But
something told me that at least
I could telephone him and give
bonds

how bad has it been?

Compare

the

enced

him

integrat¬

are

ing rocket .power into, our de¬
fense systepi

so

NOT TO BUY.

divi¬

compared with

last year.

interest in missiles has affected

his business.

have increased,

maintained

or

The break in the market—

Much to my surprise he told me
that he had bought the other two

(when he

decreased

for November.

In "A U. S. Missile Maker Looks

issues

companies

industry paid dividends,

ticle in the exchange Magazine

and call him

question were priced
our industry that we guard against
right and the issue was one that he
and vigorously resist any steps in would like if he had funds. When
the direction of government con¬ I told him I remembered he had
trol.
It is because of this that I told me he would not likely be
interested in any more invest¬
am hopeful that all concerned will
give a fair trial for a reasonable ments for a while but that I just
wanted
to keep him up to date
period of time to the individual
voluntary approach wbic^
has on what was being offered, he
been set forth by the government said he was glad I called, he had
in an effort to solve the imports some additional funds that he was
problem.
holding for another investment
the interest

was com-

if I had

You may say it is fanciful to
Several weeks ago I sold a few
imagine such things.; Maybe it is.
bonds to a client who once in a
On the other hand, controls breed
while favors me with
a
small
controls. History is full of such
order. The day this attractive issue
cases. And any amount of govern¬
referred to in the foregoing was
ment control is subject to political
considerations and political pres¬ offered, I took a look at this man's
card in my file and I noticed that
sures of every sort. If there is one
he had bought five bonds only a
industry where
politically in¬
week ago.
At the time he said
spired interference could raise
he would not have any more funds
havoc, it is an operation charac¬
for
quite
a
while. My first im¬
terized by a high degree of risk
such as the oil business. We could pulse, as I went through my list
get into a situation where some¬ of telephone calls on the new
one

are

good grade out-of-state bonds and

the total energy market sup¬
drawn
the line because of the
plied by oil, gas, coal, oil imports
geographical diversification needs
and so on. Acting under Section
of his portfolio, he replied, "Well,
7 of the Reciprocal Trade Act, the
once in a while I'll still buy some
government would inquire as to
the

There

you

investment sugges¬

tions to people who can BUY, the
better will be your sales results.
Keep trying—don't take too much

he

bonds

pletely unexpected,

only in¬
offerings of

customer of the broker in that city

import quotas the Fed¬

Government

estimate

new

and

10

SELL

often

more

was

over

which this would have abroad

of the

materialize

order for
issue which

an

told me
bought

petroleum he could'use them
despite the fact
imports. Let us look then at what that he had tbld me that he al¬
could happen here at home to our
ready had too much invested in
producing industry, ignoring en¬ his home state. Now
you figure
tirely the very serious effects it out. The
only thing I can see

allocation

If I may,
discuss the

one

have

example, but
consequences could flow

same

tempts
Today's Oversupply

for

we

oil in U. S.

projects.

should take heart

we

ernment should pry open our from
door—or worse yet, if we should

he

terested in attractive

so

com¬

field of research are so enormous

that

letting it out has turned into a
long, uphill struggle. If the gov¬

He

try only in general terms. I would
like to speculate on it in more
concrete terms. The imports prob¬

are

for the producer; they have such

search

gas.

reside.

our

provision for next
The stakes in the

no

seed.

natural

on

not

me

all of the bonds that
he could
handle in the state where we both

ernment control of the oil indus¬

wheat farmer who makes

a

little

could

action

securities,

other
research ex¬

all

any

In many ways our

small

Court's

our

did

gave

YOU

run

the

expose sound

month ago he had

a

tractive

penditures of 2% to 5%
mon.

government control of

more

exempt
about

thought about this specter of gov¬

of

In

industry

company which is affected
by the imports problem—be they
domestic producers, importers, or
both-^be fully aware of the risk
it is running in not handling the
problem satisfactorily—and doing
it voluntarily. I mean the risk of

long

and

qualified investor in tax-

a

the

1%

spend.

each

tacting

that

I have

Took Him Too Literally

of thinking it is im¬

the

r

equipment or the contractor, in
spite of the fact that he-actually
drills 90 % of the wells. All seg¬
ments of the producing industry
must aid development of new and
improved
techniques.
Smaller
operators, contractors, and manu¬
facturers can through individual
and cooperative action do much
to all of

In

IDEAS

Pays to Try!

Happily,

program.

persist¬
exposing

constantly

their needs arid their MOODS.

'

guidance to each company in its

geological and geophysical work import

and

yourself to business with quali¬
fied investors, meanwhile show¬
ing them investments ' that suit

Securities Salesman's Corner

As

government stepped
picture and provided

matter of tactful

a

ence,

that

level.

a

often

29

in

exchange

to

to

want
any

miss

issue

of

any

the

Magazine! Begin

now

enjoy and benefit by this

crisply written magazine—for

year-by sending in the

only $1

a

coupon

below. Your subscription

record cash dividends in the first

will start with the November is¬

nine months of this year-more

sue.

than six billion dollars.

azine is not sold at newsstands.

Sorry, the exchange Mag¬

TBS
the exchange

11 Wall

Magazine, Dept. 7

Street, New York 5, N. Y.

Enclosed is $1

(check, cash, money

order). Please send me the next 12 issues
of the exchange Magazine.

NAME.

ADDRESS.

CITY.

.STATE.

I
I
I
.-J

Financial Chronicle

Tke Commercial and

30

..

Thursday, November 14, 1957

.

(2130)

turn

Bank and Insurance Stocks
This Week

would

a

support

Bank Stocks

—

Originally named the Massachusetts Bank, this institution re¬
ceived its charter in 1784, the same year in which New York's
first chartered bank started business. The capital was set at $300,-

Boston individuals of substance financially
of the $500 par value shares.
The small group of Boston merchants "and men of influence
behind the organization of the bank issued a circular stating that
they had been "Taught by the experience of many nations that
well regulated banks are highly useful to society, as they promote
punctuality in the performance of contracts, increase the medium
of trade, facilitate the payment of taxes, prevent the exportation
of, and furnish a safe deposit for cash, and in the way of discount
render easy and expeditious the anticipation of funds at the ex¬
pense only of common interest."
The banking needs at that time were taken care of by wealthy
merchants, men who accepted deposits, made loans, issued drafts
on
their cftirgspondentS* overseas - and sent out goods from the
proceeds of which their promises to pay were fulfilled.
The Massachusetts Bank prospered, and by the end. of the year
of fts organization it had paid its stockholders a 4% dividend, and
000, and a number of
subscribed to $253,500

will be considered here—first the
individual

stood at $450,000.

other banks

Its success brought two

1792. In 1865 the bank surrendered its State charter
Massachusetts National Bank, the National Bank
Act having been passed by Congress. Shortly after the turn of the
into Boston by

and

became the

National purchased the First

century, Massachusetts

National Bank

merged institution. The
three ensuing decades brought the bank's greatest growth.
Old Colony Trust Company, the stock of which is held in trust
for the benefit of the First National shareholders, conducts a well
established trust business. First National operates 26 local offices,
15 in Latin America, and has a representative in London.
The
bank for years has emphasized the lending of funds, its security
investments having been of less size.
In the past several years
security holdings were reduced so that funds would be available
for the heavy demand for loans.
There are over 22,000 share¬
holders.
Capital now consists of 2,800,000 shares, of $12.50 par
value, for a total of $35,000,000, while surplus stands at $95,000,000,
of Boston,

and adopted that name for the

profit $26,407,000.

and undivided

investor, and then the

Resources

$405,905

Cash in Banks

Obligat's
State & Munic. Bonds
Fed. Res. Bank Stock

259,192

U. S. Gov't

3,900
14,591

,
'

Other Securities
Loans and

59,273

970,717
6,252

Discounts

Banking Houses
Cust. Liab. on

27,300

Accept.

12,310

Other Assets—

Capital Stock
Surplus

$35,000
95,000

Reserve for Conting.__i_
Reserve, Taxes, Interest,
etc

Acceptances
Deposits

profits and losses go
baskets, based on
the length of time the securities
Security

in

of

one

A breakdown of
the following

these assets into principal

U. S. Gov't

Loans and Discounts

14.7
3.3
1.1

Banking Houses
Other Assets

Obligations

State and Munic. Bonds
Other

23,514
30,376
1,537,169

Securities——

55.2%
0.4
2.2

accounted for about 62% of gross
coming from securities interest and divi¬
dends.
The average maturity of the bank's government holdings
at the end of 1956 was four years and three months.
In 1956 loans and discounts

income, with but 15%

six months
month

Statistical Record—F tr Share

Book

Operating

Invested

Value

Earnings

Price

Assets

Dividend

High

Low

1947

$44.01

$3.13

$377

$2.09

48%

43%

•1948

45.05

3.13

364

2.09

47 y4

411/s

1949

46.08

3.12

461

2.09

46V4

421/4

482

2.09

1950

47.30

3.31

511/s

41%

1951

47.22

3.12

433

2.09

51%

41%

1952

48.30

3.30

449

2.09

501/s

423/4

49.77

3.76

451

2.69

523/4

43%

1954

51.28

4.06

474

2.40

593/4

48%

1955

54.68

4.38

486

2.70

66y4

541/2

57.15

5.47

483

2.85

701/4

591/2

_____

1953
"

1956

_____

In this decade book value was

higher by approximately 30%;

earnings just doubled; invested assets were up about 28%; and
dividends were 53% higher. At the end of 1956 the stock, then

selling at about 66%, was priced at only eleven
book value.
In 1956 approximately 10.5% was
(up almost 17% from a year earlier); and
earnings were disbursed in dividends.

Each

basket

one




differ¬

net profit in
loss

in

the

If

net

a

two

leaves

a

the

that
profit is reportable in full, in the
regular way.
If it leaves a net
profit
in
the
over-six-month
basket, there is a two-way play,
whichever

basket,

gives

lower

the

tax:

flat tax of 25% of the profit
or (2) reporting half the profit in
the regular way.
(1)

a

25%

limit

wife

than

combined return.

a

with

People

lower^ incomes
oVerall

25%

a

If

involved

are

only half the

over-six-month

pay

profits

basket

is 20%,
in the

need

be

reported, the tax on those profits
for people in the 20% bracket is

only 10%.
How

Security Losses Are Treated
in the under-

six-month

basket

and

six-month

basket

taken

show

a

what

basket

is

loss,

over-

together

regardless

then
it

the

from,

comes

of
the

deductible, within certain

illustrate:

the net
$10,000

Suppose

of all trades for

1957 is

a

Only $1,000 of this loss
in

deducted

1957

the

can

return.

The other

$9,000 goes in the un¬
der-six-month basket for the five
1958

years

to

to

1962,

apply

against the first $9,000 of any net
security profits in those years. If
there
in

are

net

no

those

security profits
$1,000
can
be

years,

taken

as

other

income

a

regular deduction from
in

each

of

the

five

That absorbs $5,000. Noth¬
ing can be done about the other

years.

$4,000.

Security

losses
of
any
be carried forward only,

year can

not backward.

losses
in

1952
if

for

losses

be

can

not

for

effect

that

means

carrying for¬
five
years
has

used

some

far

as

in

previously
are

whether

run

pose,

91%

always

figured

in

under-six-month

or

as

high

91%.

as

Sup¬

for example, Jones is in the
bracket and that in

takes

$1,000

a

profit.

His

1957

he

under-six-month

tax

that

on

a

However, if he then
$1,000 loss on securities,

whether

over or

under six

months,

with

him

leaves

That
$2,000
of

the

under-six-month

profits

to

re¬

If he had taken his loss be¬
six-month period
had

port.

the

fore

it would have been applied
the $2,000 of under-sixprofits.
That would have
left him with the $2,000 of overrun,

profits, of which only

(with

reported

need be

$1,000

a

this

alertness

means

To wait un¬
til the end of the year, as is so

frequently done, may let the sixmonth mark slip by.

Between

Spacing

How

Years

Saves Taxes

there

'Where

profits and
month profits, it is
the

from

in

losses

take

to

over-six-

are *

month

under-sixadvantage

no
an

different year

a

profits, it is

advan¬

an

from the profits.
For ex¬
ample, suppose Jones has $2,000
of
open
over-six-month profits
and $2,000 of open losses.
If he
year

takes

-

loss

91%'in
\

he

he

1957, the result is

.both in

went

profit,"
he

short

less-

for

stock

same

If when he went'
the

owned

stock

more-

Dividends

Convert

to

How

Interest Into

the

of

Because

25%

over-six-month

on

natural for
to

ets

and-

Capital Gains

-

limit'

tax

profits,

it

is'

people in high brack¬
to

try

profit

rather

come.

Here

that

get

is

a

of

sort

in¬

regular

than

to

way

accom¬

plish this:- Suppose Jones, in the91%-sjDracket, has, 100 shares ofhim

cost

is

stock

worth

now

of

because

preferred
stock
a share.
The;

$100

S160

share

a

accumulation

an

of

$60 of dividends which are about
cleaned

be

If he receives

up.

of dividends, he will
part with 91% or $5,460

$6,000
to

less $240

(4% of $6,000)

or

$5,220.

the stock
at
160, before the ex-dividend
date
(that is, at least four full
business days before the dividend
"record" date), he gets the same
$6,000, but it is now in the form
of profit from the sale of overby selling

However,

six-month

stock.

Hig tax

the

on

is therefore only 25% or
$1,500, instead of $5,220—a sav¬
ing of $3,720. If he still wants to
maintain his position in the pre¬
ferred stock, he
can
step right
$6,000

into

back

market

the

the

after

dividend date and buy 100 shares.
That

puts him back to where he
stock-wise, but ahead of

started

the game

by $3,720 tax-wise.

zero.

>•*: If

he takes the $2,000 losses in
the

and

profits in
1958, he is ahead of the game by
a $500 deduction.
It is figured in
this
way:
For 1957, the $2,000
losses give him a $1,000 deduc¬
tion and $1,000 to carry forward
into 1958.
This $1,000 is applied

If

$2,000

sells

investor

an

stock

at

a

and then buys the stock
back, the profit is taxed.

profit

right
Not

Sales Are Treated

Wash

How

with

so

allowed

on

There

losses.

rule that says

that

is

a

loss will be

no

if

sale

a

within

30

days before or after the sale

the
This is

security is bought.

against

the $2,000 of over-sixprofits in 1958, making a
net profit for 1958 of $1,000, onehalf of which, or $500, is report¬
able.
Jones,
therefore, -has
a

same

month

known

$1,000 deduction in 1957 and $500
income in 1958, or a net deduc¬
tion for both years of $500.

purchase not only of the same se¬
curity, but also of substantially

Jones's best bet,
switch

the

however, is to
the other way

thing

and take the $2,000

around

profits in

over-

1957 and to

take the

In 1958, he has a deduc¬
tion of
$1,000 of the $2,000 of
losses. In 1959, he deducts the re¬
The

losses.
three

is

$2,000
for

effect

net

years

the

of

$1,000

the

deduction

a

its

losses

and

was

merely

in

the

same

To Tax

cause

Can

a

to

identical

pos¬

losses

or

or

for

This

of the rule that

be

of

chase
the

is

under

loss

same

will

no

reported on

that

is

be¬

the pur¬

ban.
if

stand
one

or

vice-versa,

However,
the

sale

company

the

of

is

and

the

purchase is of stock of another,
even
though the two companies
are
in the same line of business,
their stock sells at the same
and

market-wise

moves

same

price,

in

the

way.

The

law

confines the disaliowr

to "securities" but some de¬

nnce

cisions hold that for this purpose,

commodities

are

securities.

Identify Securities Sold

Suppose Jones buys 100 shares
of

stock

sells

five

in
100

1956
at

point
It

1955, at 70, and an¬
at 80.
In 1957 he

in

75.

profit

all

Does
or

a

depends.

he

have

a

five point
If he de¬

livers the 1955 certificates costing

70, he has a five point loss.

If he

or

delivers the 1955 certificates cost¬

short

ing, 70, he has a five point profit.

gain
a

stock,

the

of

stock

a

Accordingly,

stock and

a

to

voting trust certificate

a

of

applies

securities.
of

sale

the

loss?

1958,

disallowance

The

other

profits

indefinitely.

need

Used

Be

short sale it is

shift

tax

if the sale never took

as

place.

How to

Advantage

Through

loss

Sales

The

sale.

wash

a

year

stand-off.

a

Short

How

as

effect is

of

$1,000, whereas taking the losses
first, resulted in a net .deduction
of only $500, and taking the prof¬

1957

$1,000

when

the

over-six-month profit

an

other

throughout the year.

covers;

months, the profit on the'
close-out of the short position is

have

way

Jones

than six

the

matter

or

short

to

All

return-

under-six-month

an

with $2,000 of

from

$910,

is

because

maximum tax of $500), compared

regular income the
around.

1957

,'0;

when

matter

that

In

has saved Jones

No

over-six-month;

six-month

his

of

out

i

Thati

puts it in 1958.

month

profit and wipe out the $910 tax.
the

off

against

to

tax.

against the $2,000

apply it

sible

words,

it

takes
and

he

passed,

been

of over-six-month profits.

that will exactly offset the $1,000

other

hold

sale until sometime in 1958.

$1,000

will be $910»
takes

must

has

line

month

$1,000.

The tax savings from losses

over.
can

loss of $2,000 on newly
bought securities. If he waits to
take the loss until after the six-

maining

Losses

1958, all he need
covering the short

profit into
is

do

open

back

profits.
full

profit and $2,000 of overHe also has an

six-month profits.

time, it

1957 returns,
absorbed
by

500

they offset the heaviest taxed
profits.
For
example, suppose
Jones
has
$2,000 of under-six-

$2,000 losses in 1958. By
doing this, he reports in
1957
one-half
the
$2,000
profits, or

as

profit.
figures he is better off from
standpoint to push the $2,-

tax

than six months.

month

de¬

That will result in

watching on losses, to make sure

six-month

As this rule about

been

needs

of his

and

under-six-month

owned

1957

limits.
To

also

line

six-month

The

broker.

out

1957,

December,

$2,500

If he

it

91%.

tage to take losses in a different

If the net results

loss

to
six

stock

the

the short sale.

months, the range is from 20% to

As

tax.

the lowest regular tax rate
and

be¬

$32,000

becomes

and

they file

less

the tax

on

meaningful to individuals
more
than $16,000 income.

figure

earned on book

dividend

profits)

taxed
a

under-six-month

ward

Selling at present at the 62%-63 area, the present

(here

are
netted.
net
profit in

and

the

other,
this

is

basket

If there is

ently.

times that date's

only 51% of operating

less

or

into the second basket.

go

be
Range

securities

on

months

basket.

one

under-six-month

called

than

more

in

go

losses

and

six

held

for

the

losses

and

(here called over-six-

profits)

Profits

loss.

Ten-Year

Profits

securities held

on

and

categories gives

23.1%

line.

is

months

Six

owned.

are

dividing

distribution:

Cash

two

10%

Before

25%.

of

maximum

a

little as

from as

ranges

curity Profits

That

$156,407
11,974

Investor

25% Rule Works on Se¬

husband

$1,759,440

$1,759,440

Individual

The
How the

with

Profit 26,407

Undivided

obvious advantage

is an

There

in

his

with

stock

take

broker to close out

a

taking profits after a
sixmonth holding. The tax rate than

comes

Liabilities

Six-Month

the

in

The

September 30, 1957

Statement of Condition,

that he bought in

liver it to the

a

Line Saves Taxes

the

can

box

Watching

How

investor.

corporate

He

Security Market

Present

„

resources

short

Income Tax Pointers for

NATIONAL BANK OF BOSTON

accom¬

August, 1957 at 60. In December,
1957, or four months later, and
when the market is 85, he goes

'

page

is

plished: Jones has in his box 100
shares of stock

from first

position

Here is how the shift is

higher dividend comfortably.

a

short

the

actually closed out.

of the country's best managed

one

Continued

By ARTHUR B. WALLACE

THE FIRST

plus

on

until

sale

25-cent extra, yields about 4.34%, a generous re¬
banks. With a deposit
ratio of about 9.6 to 1 (consolidated) First of Boston's earnings

of $2.80

Number 5690

Volume 186

The Commercial and Financial Chronicle

...

can make, his own selection of
certificates, and so he can con¬
trol whether to have a profit or

;He
*

.loss. 2*'V ;
r,The same

a

■

•

V

he

:

••

result

instructs- his

holds

at

to

yto sell the: 3956 block or the 1955
His instructions

block.

be taken by sales
to the end of the

amounts

nical

the

on

basis.of cash

^.distinguished

as

the

for

basis

distinction

against the
crual basis. V Taxpayers on the
crual basis can.,;take
profits

apply
taxpayers who make their re¬

ing..: in

owing to them, The tech¬

name

cash

the

turns

the

time of the sale whether he wants

,

up

rules just described

The

good if

broker

can

year.

*.•• -v,.-.

-

.

losses, they
made right

,

(2131)

as

com¬

establish losses for

from

right through Dec. 31.

1957

Attend Coast

is

31

Exchange Anniversary Lunch

ac¬

ac¬
or

by sales

-

cori-

will

troi;

%:/'/;If mie

•says, nothing,; and the cer- >
-v/( tificates cannot be identified, the,.

rule is that the 1955 block is

-

■'

-

>Jirst, because: it

was

sold}

bought first

V aw

II

Union Pacific Railroad"Go.

The

Corporate Investor

''fc

_

_

There "

fr*

.

+-j

/

■

special
provisions; >v:Union Pacific Railroad; Co.,; as ::^Uni6n'-Pacific":has been granted
apply, only to ■ corporate .in-/ one of the strongest: railroads fi-. permission •. :by
the
Interstate
For example, in the case"... nancially in the country,' has been -Commerce Commission to acquire
ofover-six-month securities in-V able to maintain net income de- ^'cQptrot;;,of;:.fhe>: Spokane Internaare

.

that

-

vestors.

dividual investors have the choice

spite a drop-in operating-incomes tionaL: Railway Co. through an
paying .25% of - the profit or; "Other income,'! which is earn- ^exchange } of ^stock.
This should
reporting:one-half ■/the/ profits as \ ings'Trom investment and its oil {further,add to. operating earnings
regular?*"income. - Corporate & in- J and • gas properties, -have shown through. consolidation of the favestors have the choice of paying
a gain this yean as compared with
cilities of the two railroads. The
25% or reporting the full profit^; 1956.-.■■■■ •£.*•' % ■;... n..
Cotpmission granted this merger
as regular income.
••/;> i' ?,For the first; nine - months b£»oyer the objections of the Great
Also, while in the case of. in- ', this
year,
other income aggre-'-fJJrrthern Railway and also the
dividuals, Up to $1,000 of net se¬ gated'' $59,241,786 w as
compared ^Canadian Pacific,
curity losses; can be. immediately with a total of $58 680,758 in the
As .of
July
31,
1957,
cash
deducted from any other income, • like
period of "last year.
On the ' amounted to $42,659,829 and temof

■

,

.

'.

' F

.

such

no

deduction

be. taken / other

can

hand, net operating income "pordry
cash investments were
$27,700,363 as 'compared With $61,765,195.% This compared with
poration'■/can do with the net $31,666,730 in U the first three--;cash; of $40,240,492 and tempolosses: is -to carry them forwardv
quarters of ; 1956.
The big in-" rary cash investments of $55,314,for five years until absorbed by
crease in income came from a net
714 at the end of July, 1956. Net
profits. 'If there are no security from oil and gas which in the current assets (current assets less
profits in the five-year period, no period- this year amounted
to current liabilities) at the end of

by- corporations. •: All. that

cor-,

a

was

.

benefit

tax

derived

is

losses.

v

.

the

In

of

case

the

from

$22,198,619 against a total of the
period
totaled
$85,532,388
$19,176,822 in the year ago period; against a total of $90,729,886 at

.-

individual,

an

L.

to It.:

William H. Agncw, Chairman of

the- Board

of

Governors, Pacific Coast Stock Exchange; Robert A. Magowan,
of

Chairman

the

Board

Ferdinand

corporated;

and

President, Safeway Stores, In¬
Smith, Resident Partner, Merrill

C.

income enabled the P1® en<J.
Lynch, Pierce, Fenner & Reane, leaving floor of S. F.
^
was made
of the desir¬
road to report a total net income
Division, Pacific Coast Stock Exchange.
interesting to note that funded
ability of converting dividend in¬
of $55,425,643 for the nine months
debt
W1thin six months
come
into
security profits, be¬
SAN FRANCISCO,
Calif. —In nia makes half the progress fore¬
which was equivalent to $2.36 a
amounted to only $1,977,000 as
cause
an
individual may have to;
cast for it in the next 20 years,
common
share on the 22,229,100
c°mpared
with
the
same amount recognition of the 75th anniver¬
pay 91% tax on dividends (less
a year previously.
This indicated sary of the founding of the Pacific the Exchange will occupy a truly
shares outstanding.
This
com¬
a 4%
credit). Corporations, how-=the '.road
does
not have
heavy Coast Stock Exchange's San Fran¬ imposing position in the financial
pares with a net income of $54,ever, generally pay less than 8%
world.
799,233 or $2.33 in the like period equipment
trust maturities to cisco Division, Safeway's Presi¬
tax on dividend income.- A cor¬
dent
and
Chairman
Robert A.
President Magowan, having spent
of a year ago.
This net income me?t in fhe future for which the
poration is therefore better off
attended the anniver¬ 17 years with Merrill Lynch, in
is after all taxes and charges and 4 majoritythe railroads are li- Magowan
with
dividends
than
any
other
sary luncheon at the San Fran¬ which he
became a partner, is
p'referred dividend requirements a£le, over..the coming years. Most
type of taxable income, even in¬ for thP nprinri
of its new equipment, excluding cisco Commercial Club and after¬ naturally familiar with the oper¬
cluding capital gains.
>
ward
visited
the
floor
of
the
^
~TT .
motive: power, has been conations of stock exchanges and the
Accordingly, while in the case
.,9arli)a /ngs ?!
5: Union Pa-.structe^l in-its own shops and exchange in company with Wil¬ work they do ii) providing a mar¬
cific
of individuals, there is an advan¬
System, like those of thq wjbiie $'ome
has been capitalized, liam H. Agnew, Chairman of the ket for securities and in speeding
tage in selling stock before the other carriers serving the tern- the .majGrity has been charged Pacific Coast Exchange and Fer¬
up the financing of large corpo¬
were
down
during
the off to
dividend date and buying it back tory
dinand Smith, Resident Partner of rate
operating expenses,
enterprises.
month of October. For the week
afterwards, in the case of a cor¬
Merrill Lynch, Pierce, Fenner &
Oct.
26
revenue
freight
n
11
poration it is just the opposite— ended
Cl^0„
AJJ.
Beane.
This

mention

other

.

-

.

there

is

and

carloadings recorded

advantage in buying
the dividend date

an

before

stock

loadings amounted
to
as compared with

that in 1957, a
preferred stock i? about to pay
off $60 of dividend arrearage.
It
is selling at 160.
A corporation
buys it the day before it sells
suppose

dividend.

is

dend

tax

The

It has

it

offset

can

under-six-month

of

which

the

be $31.20.

of

$60

against
profits

$60

from

Timing of Year-End Sales
to take
is

profits

familiar

a

will

whether

selling,

tax

is important, or else a transaction
intended to affect 1957 taxes may
turn

out

to

be

the

interesting

are

not

on

the

to

other

the

deemed to be sustained

is

sale

made

profits

that

realized

on

the

buyer.

hand,

the

New

York

floor

of

delivery

day

a

four

means

that the latest day to take

inclusion

for

Dec.

and
a

1957

profits

returns

sold

on

the

to

be

Union Pacific

its

&

the

Co.,

■

holdings of
property in Wyo-

Gersen is engaging in a securities

Gersen

West

is

offices

at

110-45

Quee„s Boulevard under the firm
name of Gerard Securities Co. Mr.
Faroll

fairly short
also

and

ore

the

serve

-o

from

was

&

formerly with Joseph

Co.

and

Henry Montor

Associates

roles in the West's economy.

Both,

too, have grown from very small

beginnings,

the

been

in

born

Wohl

slow

Pollitz

&

in

exchange having
the

of

backroom

basement

office

exchange's

in

early

progress

and

years

did

exchange in the United

States.

The

Exchange

Coast

Pacific

is

with

was

74.5%

last

73.4%

transportation
against
the

and" the

year

ratio

34.1%.

control

compared

as

A

34.6%

was

large

part

operating

over

of
ex-

has been to a stepped up
of dieselization as well

.

Joins Paynter Staff

/".(Special to The Financial Chronicle)

the installation of

gas-turbine

new

has

brought

a

number of

engines.

about

a

better

This
util¬

ization of power as well as a sub¬

renders

a

definite

This

public service

in providing a wider and more
Colo. — Edward
h. Heidbrink has joined the staff stable market for those why buy
0f Paynter and Company, 114 East qnd sell.

Paine, Webber Adds
(Special to The Financial Chronicle)

already is the source of an esti¬
mated 10% of the total volume of

registered national securities
the consolidated Pa¬
Coast Exchange approaches
the end of its first year of opera¬
all

CLEVELAND,

Ohio—M.

Allen

Ruby has been added to the staff

Westheimer

Walnut

New

Another major factor
the
modernization
of

°f ,Pai"e.. Webber, Jackson &
Curtis, Union Commerce Building.

(Special to The Financial Chronicle)

tion (the San Francisco and Los
Angeles Stock Exchanges were

regular

shippers and at the same time reducing operating costs.
Further

DENVER, Colo. — Maurice M.
Swank has been added to the staff
of Mountain States Securities Cor-

$329,405,948, which

poration, Denver Club Building.

of

of

new

electronic

planned for the future,

with

formerly

was

Cosgrove,

Whitehead & Gammack.

With Eastman Dillon
(Special to The Financial Chronicle)

CLEVELAND, Ohio —Raymond
W.

Rooney, Jr. is now affiliated
Eastman Dillon, Union Se¬

with

curities & Co.,

consolidated

Jan.

$630,000,000

with Gottron,

With Goldman, Sachs
(Special to The Financial Chronicle)

TOLEDO,
Johnson

is at the rate

If Califor¬

is

Ohio

now

—

Robert D.
with

connected

Goldman, Sachs & Co., Mr. John¬
was
formerly with Hayden,
&

Co.,

as

Toledo

repre¬

sentative.

With June S. Jones Co.

2,

a year.

National City East
He was formerly
Russell & Co., Inc.

Sixth Building.

son

sold for

are

and

CLEVELAND, Ohio—Joseph H.
Ternes
has joined
the staff of
Lawrence Cook & Co., 1940 East
Sixth Street, members of the Mid¬
west Stock Exchange. Mr. Ternes

Miller

1957) with
great confidence in the future.
The Exchange's transactions for
the first six months of 1957 totaled

installations

Company, 322
members of the
Cincinnati Stock

Joins Lawrence Cook

cific

(special to the financial chronicle)

yards

&

Street,

York

exchanges,

With Mountain States

delivery, and in that
profits can still be estab¬
of

CINCINNATI, Ohio—Robert A.
Conger has been added to the staff
of

Serving the fastest growing area
in the United States and one that

Kowa Avenue,

stantial reduction in fuel costs.

has been
freight

instantaneous communication.

ft; MORGAN,

progress
as

Staff

to

(Special to The Financial Chronicle)

^

about better and faster service to

four-day

Westheimer Adds

'

months

H.

Opens

Brown
simultaneously two trading floors
: MIAMI, Tla.
Gordon F. Brown 400 miles apart (San Francisco
year
than last, this carrier has ;ls engaging in a securities busi- and Los Angeles). This is made
been able fo keep expenses under ness ^.om, °Jflce® a
North- possible by a remarkably complex
a high degree of control.
telephonic
installation
w h i c h
The op- west Sixth Street,
brings the two trading floors in
erating ratio for the first nine \
Despite higher wage rates this

Ohio-David

with W. E. Hutton

now

& Co., First National Bank Build¬
ing.

hot

really get rolling until the 1920's.
Today, the Pacific Coast Stock
Exchange is the second largest
regional

Carter is

was

^ovemenfhof^Ped^„gLhg


lished:
for 1957.
In the case


(Special to The Financial Chronicle)

CINCINNATI,

Exchanges.

1882.

unique among the world's finan¬
cial institutions in that it operates

ex-

Gordon F.

products of the West and both
daily assuming more vital

The

FOREST HILLS, N. Y.—Gerard
busjness

are

institutions

Both

business.

its

are

back

Forms Gerard Sees,

be-

vast

recognizes the usefulness of
the exchange and the exchange
recognizes this company's shares
as an increasingly important item

way

in

VVltn IVlarsnall L.O.

well

is

shares have become
increasingly important invest¬
ment medium in the West, Safe¬

profit will therefore be
item.
Between
Dec. 26

31, securities can be
instead
of
the

"cash"

way

is
the

business

1958

and

in

Securities

day, Dec. 26, will
be delivered until Jan. 2, 1958

next
not

24.

to

Sloan

(Special to the financial chronicle)
MILWAUKEE, Wis.—Edward J.
Mau is now with The Marshall

Utardum? be a valuable S°urce °f
<-

penses

in

business-

this

rule,

the

time

exchanges

various
have

are

when the

exchange, regardless of the
of certificate delivery.
As

for

until the securities

delivered

are

Losses,*

rule

considered

purposes

sold

and

The reason for this is

vice-versa.

tax

item,

1958

a

continue

able

iron

haul

Timing

added

He was formerly with First Securities Company of Manitowoc,

Coast steel mills with

establish losses,

or

occurrence.

be

C.

However, it is
revenues from other

have

on

been

Willi Marshall Cr%
*

ming,
according to preliminary
explorations
When this property
is
developed it should add conIt
sideraMy to earning power

closing up this possibility retro¬
actively for the year 1957.)

Year-end

to

ore

has

Donald

of

C.

Kent

Cascade Building,

year.

will

lieved
iron

Dorwin
staff

—

Company, 765 North Water Street,

maintained.

on

(Congress is considering

the deal.

aggre-

Oreg.

November

of

month

that

sources

The corporation there¬

fore stands to be anead $26.52

the

last

likely

on

otherwise

would

tax

in

ues

loss

under-six-month

which

/PORTLAND,

period of 1956
Currently rail traffic in the district served by Union Pacific is
believed to be running under a
year
ago,
which probably will
mean a decline in freight reven-

$60

As Safeway

an

1,422,000
an

With W. E. Hutton Co.

/\aas

(Special to The Financial Chronicle)

gate of 1,459,000 cars in the like

corporation

then sells the.stock at 100.
an

cars

divi¬

the

on

The

$4.6*8.

the

collects

and

ex-dividend

week.

1956

oioan

i^onaia

decline of

a

like

For the first 43 weeks of this year

selling afterwards.

Thus,

the

from

4.3%

,

(Special to The Financial

Chronicle)

Oreg.—Dennis R.
O'Neel is now affiliated with June
S. Jones & Co., U. S. Bank Build¬
PORTLAND,

ing.

32

The Commercial and Financial Chronicle...

(21;

Continued

from first page

up

alter Wfe 1954 recession proved

to

be

minor

as

standards

not

were

1949.

as

timistically.

more

op-

financing well in

range
the

of

lowered, given six

prospects' were viewed

(bi Economy's Performance

Where

advance unusually high level of some $4
outlay—oftett from' billion at annual-rates. This level

actual

months to
Both

For these and

traordinarily

creased their

abroad

outlays and in state and local capital.
The pressure of these demands
government expenditures.
Consumer spending has pretty much on existing facilities and materials
being produced—our Gross Na- tagged along. To be sure the $44 supplies was so great that prices
tional Product measured in con- billion increase in consumer goods moved up sharply in these sectors.

for well

greater than has been the largest single item in
over-all
expansion
in the
seasonally ad¬ the
justed basis employment and out¬ Gross National Product, but this
put per man hour—the productiv¬ only reflects the basic place of the
ity of labor—are also at record consumer in the economy. Apart

It is clear the

is operating at the highest
levels
in history. The total
amount
of
goods
and
services

«tant

prices

—

On

before.

levels.

The

is

This

a

ancj

declines

small

in

in¬

from

dustrial production since the

sumers

of the year have been
made up by increasing

tion

first
more than
output' and
employment in other sectors. The
additions we are making to our

brief flurry

a

in 1955, con¬

have about the same frac¬

national

the

and
the increase in their spending has
of

over

these lead

related reasons, business

economy

ever

well

a
year largely reflected a set of unusual
times, as /circumstances, notably the backthe gradual tightening of wash of the Suez crisis and ex-

ahead.

other well as
firms in- the money market, are reflected in
capital budgets sub- the gradual tapering off in the
stantially even when this would rate of growth in capital spendrequire large amounts of outside ing which has been occurring now

—Today and Tomorrow

output,

just about matched the growth in
their incomes percentagewise,

in

increase

prices

product

profits that normally follows
increases in demand and
insistent push for still more

major
the

satisfy these demands
led management to be willing to
grant wage increases greater than
increases
in
productivity. These
output

to

worked

What

year.

Economic

Picture

of business prospects

now

business outlays on
plant and equipment will not pro-

ness

investment for expansion

other

pends

increases in wages and
prices then gradually

This

in
de¬
the rate of increase in
of the

sectors
on

outlays,

level

itself

not

specific

the

on

Such other important measures as

for

orders

new

machinery

and

very

much smaller. In view of the

great public debate and frequent
misleading statements over the
last year, we should particularly

equipment, and contracts for note that Federal outlays on cur¬
tieavy construction have been fall¬ rently produced goods and serv¬
ing sharply.
Profit margins have ices are up only .3% as against
narrowed, and quarter by quarter, three years ago and are actually
the

rate of increase

in real gross

products and in business capital
•expansion have been declining.
: At the

same

time,

the number of

new

smaller

if

allowance is

made for

rising prices. (The much booted
increases in Federal expenditures

has

bave been on other outlays which
have a much more indirect effect
of on business conditions.)

know that
products be-

we

introduced, the number
being opened up—and
frtill more basically, the pace of
business outlays on research—are
accelerating
rapidly.
We
also
lenow that the size of our popula¬
ing

markets

tion, and consequently the size of
our potential market, not only has
{been growing by increasing
amounts each year but is almost

An increase of about

$5 billion

This same primary pressure to third and fourth quarter now con¬
firm this expectation. The accu¬
expand our stock of plant and
equipment and other real capital mulating evidence of the same
similarly goes far to explain what kind over the last year now justi¬
has been happening |in the money fies a judgment that capital
market. The up-surge of business spending will continue to decline
at least through the first half of
capital expenditures following
1958, and this judgment is again
1954 started with business firms
generally in a very liquid position confirmed by the National Indus¬
and with

1955,

ment, also provided

were

stimulus
other

in

sectors

the

last

important

year

when

slowing their
advance, but contributed little, in
the earlier stages of the upswing,
were

both

re¬

accruals

in

markets

in the rate of' net foreign invest¬
an

trial Conference Board's most

profits and depre¬
rising.r' The in- cent survey of capital appropria¬
This survey for the first
outlays was so great, tions.
however, that liquidity positions time shows a decline both In the
progressively tightened and in¬ dollar volume of projects cur¬
drains on the capital rently being approved and in the
creasing
ciation

crease

had

while

to

be

made

internal

even

fund

in

flows

ations.

booming and inflationary- pres¬
growing, the Federal Re¬
serve properly retarded growth in

Governmental Spending
Unless the

federal

possible increase in

military spending in the

countries

these

high

would

levels

reasonable

be

that

our

is

likely

investment

be

can

A

judg¬

net for¬

de¬

to

cline (at annual rates) by some $2
billion.
Any such decline would
be

just

depressing to the econ¬
similar size of decline in

as

omy as a

domestic capital outlays.
Business

investment

tories has been at

this

pace

than

year

inven¬

in

much

a

slower

last

—

an

annual rate of about $2 billion in
contrast to $4 or

$5 billion. Under
pressure
of re¬

the

continuing
availability
of
credit,
stable or declining sales in the
manufacturing sector, and progressively smaller backlogs of orders,
some moderate liquidation of inventories must probably be expected .within "the
next
year,
assuming no serious war scares,
In most industries- current inventories are not greatly out of
line with sales, and the extent of
the absolute reduction should be
moderate. Nevertheless the shift
from accumulation, of inventory
stocks at a rate of plus $2 billion
to
a
position where inventory
stocks were merely being main¬
tained
would
have
a
primary
stricted

depressing effect on general busi¬
ness
equal to that of a full $2
billion decline in final purchases.
Expectations

Consumer

The most recent survey

evidence
buying
high
level in over-all terms. Expecta¬
that

indicates

for

tions
of

consumer

remain at

intentions

purchases
do

course

-

not

a

very

durables

of

match

those

shown in the

buying spree of 1955
more moderate levels of
1956 and 1957 are generally being

but

backlog of unexpended appropri-

still favorable. With business

sures

that

maintained.

if

even

stimulus

economy

of the

many

maintained.

eign

activity during this
stimulus from busi¬

The

in

which provide our principal mar¬
kets abroad, it is very unlikely

eral

—

sustained and has generally been

efforts to control internal in¬

ment

business

our

light of the growing balance of
payment problems, currency dif¬
ficulties, and increasingly strenu¬

vide any further stimulus to gen¬

period.

large demands
exports. In the

for

flation

for the next six to twelve months?

themselves through other

primary

a

ous

Pending

such

materials

over

clearly been
plant and equipment and capital while it has fallen behind in dol- sectors, where the pressure of de- weakening for a period of over
lars. Contrary to common impres- mands was not as
stock generally, and consequently
strong and the a
<
year under the delayed impact
to our ability to handle future in¬ sions, consumers have been saving increases
in
productivity
were of credit restrictions, thinning
creases in demands for output, are
more,
not less.
But while con¬ substantially smaller. In this way liquidity positions among firms of
sumers have been increasing their
the largest on record.
a
strong "cost-push" pressure for all sizes in most industries, nar¬
dollar spending only 17% in the
But while the over-all levels of
price increases spread throughout rowing profit margins, and in¬
last three years, business spend¬
the
<e c o n o m ic
economy.
The
big upward creasing evidence that capacity
activity have been
breaking new ground, signs of ap¬ ing for plant and equipment has push in industrial prices came in was reaching—and in increasingly,
increased 35% and state and local 1954 and
1955, wholesale prices in numerous instances substantiallyparent weakness have been ap¬
pearing in increasing number. I outlays nearly 30%. Not only have general followed in late 1955 and- exceeding—desired levels in relathe increases in these sectors been
1956.
Consumer prices were vir- tion to current demands for out-.,
need only mention a few. Manu¬
facturers'
sales
generally
have relatively very large, they have tually stable until about the mid- put. Indeed, the evidence on these.
continued,
to
provide
a
die
of
last year but since then things a year ago was sufficiently
stimulus
been falling not rising since the
(first of the year. Industrial pro¬ throughout the upswing: capital have gradually moved up under clear that many of us were even
duction has been cutback by about outlays of business and state and the pressure of increasing costs, then—allowing for the lead times
local expenditures have expanded These increases in the cost of liv- involved
2%, but inventories have contin¬
predicting some small
in every one of the last twelve
ued to rise almost without inter¬
ing—the price index at the con- decline in capital spending during
sumer level—are
still continuing, the latter half of 1957. Recently
j;
ruption.
New orders have de¬ quarters.
In contrast the support from
released surveys of business plans
clined more than current sales and
for
Money Cost Increase
order
backlogs
are
dwindling. other sectors has not been so well
capital expenditures in the

Hour? of work and overtime have
been falling, particularly among
durable goods manufacturers.

Thursday, November 14, 1957

the

,

maintained, and total spending on
soft
goods and services should
continue to increase roughly in
line with any further increases, in
incomes and population. In addi¬

light of Sputnik and other recent tion to the evidence from surveys
bank credit, and interest rates
...
.•
■■
progressively increased under the
»L,.
ahead smartly for a time under pressure of demands for funds in changes the outlook for these ex¬ may note the continuing strength
of
retail and
department store
certain to continue to do so for the stimulus of the 1954 Housing excess of currently generated sup¬ penditures, it seems probable that
the current rates of capital spend¬ sales and the continuing growth
teome time to come.
legislation, but for nearly twO plies. 1956 and 1957 have seen
in total consumer spending this,
In the face of these cross cur¬
still larger increases in the costs ing by business firms will be per¬
years has been progressively fall¬
haps $2"billion lower a year from year as weir as last, as Incomes
rents it is entirely understandable
ing behind. Inventory accumula- of money as capital outlays con¬
now than they ace currently. The
tave continued to rise. Oyer the
that there is a big question in tions provided a
major stimulus tinued to increase in the face of
over-all declines in capital spend- rest of this year consumer spend¬
Everyone's mind whether we have to the expansion until about
-*—j
a
narrowing profit margins, stable
really reached the crest of the year ago, but this increase was or weakened internal flows of ing are not likely to be much ing should show some further
present upward movement with largely a secondary response to funds and a consequent sharp in¬ larger than this because the vol- increase in total and help to^susume
of current work in process loin
general levels of business
cm imminent decline in prospect—
the increasing volume of sales and crease
in dependence upon
the
is very large and runs off slowly, through the fourth quarter.
and if so and for how long and output generated elsewhere, and capital markets. During this pe«evere

the

whether

will be

decline

we

have

—

or

simply reached

plateau that is a pause in a
basically continuing upward
movement. A quick review of how
far we have come in the present

Residential

has

construction

.

,

.

surged

f,™? «rge anu runs orr srowiy.

weakened

notably

since

the

first of the year.

riod,

incidentally,

it

noted
ted that
that the
the federal
tedeial

£

should

Alsosomeimportant capital

been happily running a
surplus and has been a net

The fact that this has

come

Conflicting „£orcess^ll?"J™!

using

into play in 1958. some increase
creasing their outlays and others in consumer incomes will come
cash
will be cutting back less than most from increases ill wages that have
supmanufacturing industries.
It
is already been: negotiated and are.

government industries like utilities will be

has

Capital Spending Boom

be

vnvernrr.ent

in-

primarily plier of funds, apart from sea- worth
noting that in both 1949 and
a
boom in business
capital sbrial movements in and out of the
upswing of business activity and expenditures and state and local market. The federal debt held by 1954 capital spending did not fall
by
as much as
10% in; any less
especially what the basic stimu¬ outlays goes far to explain the the public was $9 billion lower
than 18 months. Sharper: cutbacks
lants have been will provide a changes
in prices and interest at the end of June 19$7. than it
are
of course possible, 'but they
tiseful background for consider¬ rates that have
occurred. Popula¬ had been two years previously.
are
not probable at the present
ing these questions. It will also tion pressures and the
pressing Nonetheless, in spite of this assist time.
belp to explain important move¬ demands for new
schools, high¬ from the fiscal operations of the
ment in prices, interest rates and ways and other local
State and local outlays, how¬
facilities, to¬ government, the net result of this
money markets which have caused
gether with the backwash of ris¬ surging demand for funds to fi- ever, are almost certain to in¬
much concern.
crease by about this same amount
ing wages and
costs
generated nance capital outlays has been one

in

been

have

In

the

Have

three

We

years

Come?

since

the

creases iii state and local

drafts

increased

the

by $80 billion or over
20%, before allowance is made for

increasing prices. Even at stable
prices the increase has been about
$54 billion or more than 15%. In¬
dustrial
production
alone rose
from

an

index of 123 to 147 at the

beginning of this year—a rise of
nearly 20%—and is still up nearly
17% from the previous low. Overall, this stands as one of the
largest and one of the longest upswings on record.




These

was

projects

required

outlays,

heavy

the capital markets, and
pressure for
these facilities
on

so

great most

projects went
rising costs,
At the same time
many firins still
needed more
capacity to satisfy
through

m

spite

of

demands for their

existing prod¬

ucts, and much additional invest¬
ment
was
needed to open new

markets

and

supply

new

money on record.
:
These increases in the costs of

being generated by the
declining volume of expenditures
in the other sectors already dis¬
cussed.
The
pressures
for
in¬
creased
expenditures
on
soft
goods and services, however, re¬
main very strong and total con¬
sumer
spending should be well

.

A

availability of
capital
have
clearly
slowed the rate of capital spending, but as usually happens, they

Residential construction has stabilized over the last half year and
should show some moderate im-

have taken hold with

provement within the next twelve

outside

able

tirfte

lag.

a

consider-

There is always a

months. Terms

on

on

their

the

in

not

FHA loans have

recently been made more attrac¬

three

tive

tures on durable

outlays.

ers,

made

Approvals of appropriacapital budget will be

a

from

three

months

to

as

and even if there is

in the over-all

anticipated

borrow¬

no

change

in

the

de¬

crease

time

capital

first half of this year was at

the

times

as

large, as expendi¬
goods other than

housing. Expenditures on services
have shown a more persistent in¬

credit picture the

reduction

of 1958.

other things we should
note that outlays on non-durable
goods have been running about
four times as large, and con¬
sumer outlays
for service indus¬
tries
have
been
running about

substantial lead time between de¬
cisions to spend and the actual

both to lenders and

somewhat 'in¬

first part

Among

much as two or three'years before mands of business firms for funds
budgets, the actual expenditures get made should improve the supply of
through fear of. a serious postwar and the. facilities are in place funds for mortgage credit.
unwillingness to Equally important, most large
Net foreign investment in the
rein

if

main tained
creased

..

Housing Outlook

money and reduced

promising tions "in

products. It also appears that
many firms which had held a tight

the next year is likely to be small.
Ir

depressing effect, as will

sumers

elsewhere* led almost inevitably to of the sharpest and longest main- and the net effect of changes in
relatively large and continuing in- tained increases in the cost of these two sectors together within

trough of the 1954 recession our
output of goods and services has

a

the reductions in incomes for con¬

„

Far

reduced hours of work and

smaller amounts of overtime will

_

How

present contracts.; At the same

time

series

over

than
we

other

period

of

economic

know of—these outlays

have increased
.

longer

a

any

quarter, by quarter

in every one of the last 18 years

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

(2133) 4 33
—and

there

is

Teas6n-,tp

pp;

The

ex¬

effects

of

change

any

in

pect them uotyto

Federal

next

business prospects within the next

SimilairlyV nbn-durafide
goods expenditures are strongly
affected by population increases,
year.

and

these

related

that

are", also
secure' for
ahead.? For these and

time

some

I

reasons

total

am

consumer

expecting

expenditures

will be

reasonably stable or some¬
what higher than in the next few
quarters even it consumer incomes
not

are

fully maintained at their

present levels.

-

...

1

r;

■

may

First

of

on

eliminate

far leads to

the level

of Federal

goods

on

rates

and

a

level

of

expenditures

services

tax

and

unchanged from present

are

levels,

conclusion :that if

a

moderate decline- in the
real

Gross

National

Product and total business activity
would
have
to
be expected
in
1958

if

other judgments are
Since past increases in
wages, labor costs and material
prices have not yet been fully
my

accepted.

reflected

at

the

further i

some

prices

sumer

increase'^!^con¬

must

this period

over

general

consumer-level,

recession

is

in

the

Gross.'; ^National
somewhat; ?less

Product

will

than

drop in rfeal tefems; but

the

the

decline

be

in

FRB

inde&}<bf in¬
dustrial
production can'^b^pxpected to be somewhat ^greater,
(because of the increasing'impor¬
tance ;of
ther service
industries

and

is

in.

cuts

business

in

would

of

such

business

before

have

be

Federal

on

felt

funds

spent. This much

alone would improve prospects for
business conditions for next year.
There would also be
in

actual

some

Federal

increase

spending

on

goods

and services which would
further stimulate business
activity.
I note these effects because
are

immediately

germane

they
the

to

of
subject
my
analysis,
even
though it is clear that the purpose
of such
changes in the Federal
budget lies in overriding grounds
of
national security and not in

shortrun

fiscal

action

to

offset

a

change
in
business
conditions.
Apart from security considera¬
tions, the latter, purpose could be
served certainly as well and
prob¬
ably very much better by, tax
the

which

are

now

question.* "r

out

of

;

reasonably

a

end

of

downturn

keel through

even

this

Up

sectors

with
in the

year,

probable

some

first

until

whose

few

a

weeks

would have said that

Federal

services

outlays

would

goods

on

have

I

ago

decline

some

to

and

be

ex¬

pected, and

any such development
would have been a further
depress¬

ing factor

in

the

outlook

in

the

absence of prompt and

completely
offsetting tax reductions.
Until
very recently there could be little

step-ups in Federal spending, over
levels contemplated only re¬
cently. There will, however, be

the

off-setting
trends
in
different
sectors,
and
consumer
prices
should

for

funds

doubt of the vigor and seriousness

some

mands

the

Adminis¬

to

rise

frac¬

tionally. There is no prospect of
major changes in the supplies of
savings or in over-all demands

of determination

of

continue

this

over

reduction
for

period,

in

outside

with

business

capital

de¬

being

tration and the Congress to reduce

offset

these

mortgages and perhaps Treasury
borrowing. The Federal Reserve

outlays. In the quarter just
ended, for instance, defense
spending was running at an an¬
nual

rate

of

between $40 and

by increases

be

can

roughly

in

expected

residential

credit

whole

fiscal

July

at

1

duction

ending

year

only $38

in

the

billion.

current

next
A

would

have

been

required

in

target

seemed obtainable to

never

of

Somewhat

us.

reductions.> of
seemed

more

Changed
The

perhaps

smaller

$2

awesome

Position

spector of Sputnik

international position and the in¬

creasing threat to our military
position has substantially changed
the picture. A firm determination
to recover lost ground is
going to

vigorous leadership,
imaginative and realistic planning,
more

less

inter-service
rivalry
cluttered administrative red
•—

and

when

more

we

The

money.

afford

can

to

and

tape

days

cut

our

provision for national security and
to particular nice round

survival

numbers for debt

particular

ceilings
set
by

figures

and

to

budg¬

etary considerations under exist¬
ing tax rates, are over—if they
existed. I

ever

to

judge

sure

that

and

the

strong
sinew
our

as

the

so

is

ST.

LOUIS, Mo. — Charles J.
joined the staff of I. M.
Simon & Co., 315 North Fourth
Lcrner has

Street, members of the New York
and Midwest Stock

American

to

am

economy

people
provide

are

the

haps I have

Exchanges.

not

more

weaken

ATLANTA,
Braswell

is

Ga.— Reuben
connected

now

First Southern
tree at Ponce

A.

with

Corporation, Peachde Leon.

confidence

in

Krumbein

Ga.

has

—

Herbert

become

rate

i The Chase

Bank

is

syn¬

York
and

City School

Con¬

Various

Municipal
(serial)
bonds,
Nov. 15, 1958 to 1972, inclus¬

Purposes
due

ive.

3.60%

The group won atvard of the
on
its bid of 100.4549 for

bonds

:

the

Government

market

continues

funds seeking a

more

to

be

on

3.60s, representing a net in¬
terest cost of 3.54859% to the city.
The bonds are priced to yield

the

temporary haven in the

expected that the refunding and

from

2.60% to 3.54%, according"
maturity.
J
' ; f
'
Participating in the offering are
—Chemical Corn Exchange Bank;
to

new money

Manufacturers

Trust
Company;
Brothers; Blyth & Co., Inc.;
Harris Trust and' Savings Bank;
Barr

Bank Loans Continue Light
Federal

New

struction

rais¬
ing terms and the securities to be used in this operation will be
made public very soon.
' ;

The

-

offering $36,500,-

000
*

Treasury obligations. Last week the Treasury Bill
under the discount rate for the first time in more
than

•...

City Bonds
Manhattan

manager of an underwriting
dicate which i£

liquid
was

two months. It is

Reserve

System, last week,

•

Hornblower &
was
a
substantial
Weeks; 'Carl M.
considered to be pretty much
Loeb, Rhoades
& : Co.;
Merfill
of a normal seasonal
development., In November and December^ Lynch, Piercej Fenner and Beane;
the Central Banks are
usually very sizable buyers of Government
J. P. Morgan &
Co., Inc.f The
obligations in order to provide the member banks with funds, •Northern Trust
Company; Phila-to finance the needs of
agriculture, commerce and

buyer of Treasury bills, but this

was

industry. As
against this, the loan demand of the New York
City member banks
continues to be light for this time of the
year. Moreover, for the

week ended Nov.
6,

business loans registered a decline of $27 mil¬
Since the first of the
year, these loans have increased only
million, whereas for the same period of 1956 they rose by

lion.

>'•'

-

•'•

■

;

-

The loan trend is

ket

being watched very closely by money mar¬
specialists, because the failure to register any material increase

could mean that the decline in business is
being accelerated. More¬
over, such a development, most certainly will in time bring about
not only ease in the
money market, because of the lessening de¬
mand for funds, but also a

policies of the

powers

change
that be.

"Professional" Buying Based

in

on

the

restrictive monetary

Expected Credit Ease

strong in some quarters of the money
money policy of the monetary authori¬
ties will be relaxed
gradually, and this means a favorable climate
for fixed income
bearing obligations. It is being reported that the
volume and activity in all bond markets has
increased, especially

in the Government
sector, where some of the professionalism has

given
but

to what is being termed "real" investment buying. So
purchases have not been made on a "wholesale" basis,

way

far these

they

larger than lias been true for quite a period of time.
there have been no glowing indications of< position
building in Treasury obligations, although there are evidences that
are

Up to,now,

selected issues in the list

are

being looked

upon

with considerable

favor among traders and dealers in these securities.

New

■

••<

.

delphia « National " Bank; R; W.t
Pressprich & Co;; •
./
•
..r
Jlallgarten & Co.; Swiss Amer¬
ican Corporation; B. J Van Ingetr
& Co., Inc.; Baxter & Company;
Ernst & Co.; Federation Bank &
Trust
Company;
First National
Bank' in Dallas; Gregory & Sons;
E. F. Hutton & Co.; Wm. E. Pol-N
lock &
Co., Inc.; City National
Bank & Trust Company, Kansas
City; '
v."
• A"
U:"
.

"The

Robinson-Humphrey

Co.,
Inc.; Sterling National Bank and
Trust ' Company
of New York;
Stern Brothers &

The opinions are
very
market that the very tight

Co.; Trust Com¬
of Georgia; Robert W. Baird
Co.; Blunt Ellis & Simmons;
Burns, Corbett & Pickard, Inc.;
Courts & Company; Fahey, ClaTk
& Co.; Folger, Nolan-W. B. Hibbs
& Co., Incorporated; Mason-Hagen,
Inc.; Pacific Northwest Company;
Peoples National Bank of Char¬
lottesville;
Piper,
Jaffray
&
Hopwood;
Ryan, Sutherland & Co.; Schaffer,
Necker
&
Co.; Schmidt, Poole,
Roberts & Parke; Singer, Deane &

pany

&

Scribner;

Money and Refunding Terms Awaited

Wachovia

The optional call obligations, namely the 4s of 1961 and
1962,
continues to move into strong hands, and this is in spite of some

reports that there might be an offering of a similar type of obliga¬
tions in the impending refunding and new money
raising operation

Treasury. As against this, there are those who believe there
no offering of optional call obligations in the new
money
raising and refunding venture by the Government. It should not
be long before the answer is known to this
one, because it is ex¬
pected that the kind of securities that will be used in this opera¬
tion

will

be announced

Harris, Upham &
Pryor Street, Northeast.

either late today or tomorrow.

Reports continue to indicate that

is still being taken
out of the eauity market and being reinvested in short-term Gov¬
ernment issues, mainly Treasury bills. Some of this money is also
being put to work in Treasury notes.

Stein
Bank

Bros.
&

&

Boyce;

Trust

Com¬

Yarnall, Biddle & Co.; Con¬
tinental Bank & Trust Company,
Salt
Lake
City; First Security
Bank of Utah; Prescott & Com¬
pany; Stone & Youngberg.
pany;

money

overhang of the unsold part of the American Telephone and Tele¬
graph bonds. Recently offered new issues of corporate bonds have,
in most instances, been well received. This means that the institu¬
tional investors are being attracted to issues that have a
yield

Co.,

meets

more

(Special to The Financial Chronicle)

Colo.—Roy R. NewJohn B. Sandstead and H. IX
Thompson have been added to the
DENVER,

som,

staff of Mountain States Securities

Corporation, Denver Club Build¬
ing.

their

needs.

Measured

bonds, the yield

on

against the return

non-Treasury

new

on

long-

Specialists in

;

U. S. GOVERNMENT

issues is

favorable.

and

A.

With A. G. Becker

Rejoins Clayton Sees.

(Special to The Financial Chronicle)

(Special to The Financial Chronicle)

26

l

CHICAGO,
111. — A.
Robert,
BOSTON, Mass. — Arthur V.
Mages is now associated with A. G. King has rejoined the staff of
Becker &
Co.
Incorporated, 120 Clayton Securities Corporation, 79
(Special to The Financial Chronicle)
South La Salle Street.
He was Milk Street, members of the Mid¬
PEORIA, 111.—F. Ward Culver, formerly with Arthur M.
Krensky west Stock Exchange.
Mr. King
Jr. has been added to the staff of
& Co., Inc.
who has been in the investment
A.
C.
Allyn and Company, In¬
business in Boston for many years
corporated, First National Bank
was recently with New York HanWith Webber, Simpson
Building.
seatic Corporation.

A. C.

Three With Mt. States

The corporate bond market is acting well in spite of the
large

affiliated

with

FEDERAL AGENCY
SECURITIES

Allyn Co. Adds

(Special to The Financial Chronicle)

Joins Allan Blair

CHICAGO, 111.—Harry L. Sauer
has

(Special to The Financial Chronicle)

CHICAGO,
Walsh

has

111.
joined

Allan Blair &

—

Robert

the

staff

G.
of

Company, 135 South

than

some

Jackson

&

firm

judgment.

Salle Street.

added

to

the

staff

—

Benjamin V.

writh Paine,

Curtis,

209

Webber,

South

Joins R. B. Sideckas

of

Midwest Stock Exchange.

(Special to The Financial Chronicle)

SHREWSBURY, Mass. — Ingrid
formerly with Gibbs &
Co., has joined the staff of R. B.
Sideckas & Co., 47 North Quinsigamond Avenue.

La

LOUISVILLE, Ky.—Clarence G.
Taylor has joined the staff of The

8c Co.
INCORPORATED

20 BROAD

STREET

NEW YORK

With Corey

Nelson

(Special to The Financial Chronicle)

DENVER,

Bankers Bond Co., Inc., 237 South

Nesbitt is

Fifth

Investment

Street.

Aubrey G. Laxston

Cannon,

(Special to The Financial Chronicle)

(Special to The Financial Chronicle)

CHICAGO, 111.

been

Webber-Simpson & Co., 208 South
La Salle Street, members of the

Joins Bankers Bond

Paine, Webber Adds

now




most

still

(Special to The Financial Chroskcle)

ATLANTA,

Finson is

my

short-term

term Government

Harris, Upham

the soundness and
strength and
vitality of the American economy

others, but that is

The

strong side, with

which

Joins

the

long haul. Per¬

New York

Corporate Bond Market Acting Well

be required for
La Salle Street.
security, and that

will

Group

Offers $36.5 Million

-

First Southern Adds

may

economy over the

Governments

on

been buyers of the intermediate and
longer-term Treasury obligations in not too large
amounts, but in siize enough to have a notice¬
able effect on
quotations in a still rather thin market. The fact,
also, that owners of these issues are more reluctant in
letting secu¬
rities out. at the current levels of
prices is important in the favor¬
able market action of Governments.

(Special to The Financial Chronicle)

really

economist I

American

national

doing

position

no

much

an

enough
that

in

am

how

needed, but

(Special to Thi; Financial Chronicle)

billion

overhead and the growing realiza¬
tion of the deterioration of our

require

Joins I. M. Simon

likely to be realized.

International

'

of the

more

rates

•

will be

of

order to realize this target for the
entire
year,
even
though
the

many

probable.

are

re¬

rate

spending
of
considerably
than
$3 billion at annual

rates

-•

considerably improved with reports that volume and activity has
expanded in a moderate way. ; Investors,
according to advices, have

maintain

to

7

V

the

existing degree of
Yet
restriction
the
revised
through
this
budget
estimates released early in Octo¬ period and no major changes in
ber showed expenditures for the either short- or long-term interest
$41

billion.

r

By JOIIN T. CHIPPENDALE, JR.

$1,822 million.

On balance then it
appears that
business generally will continue
on

Reporter

4

.

It is evident that the tone of the
Government bond market is

$129

Summary

the

"

;• *

oc¬

increases

would

the

were

' *

r

will

personnel, materials
plants. A large part of

effects

' **.

•

activity

for

even

the

;

Our

and

curred.Issuing new contracts will
lead, to new. orders by private
and

-

outlined.

contracts

reductions

Chase Manhattan

upon

.

half of 1958. v In over-all
terms,
activity these declines should be moderate,
included in that index.)
however, in the light of probable

other

not

in

briefly

.otherwise

iri prospect.
cdrreAU money reductions

The decline in the

value

..beexpected
thoUgh some

even

programs

rescinding

cancellations
that

themselves

GNP

So far I have not mentioned the
Federal budget. What I have said
so

be

all

private

;

-

year

even

Fiscal Impact

security;

Colo.

now

—

Richard

B.

with Corey-Nelson

Co., 1575 Sherman.

CHICAGO

BOSTON

The Commercial and Financial Chronicle

(2134)

M

•'

Continued

Public

Pipe Line Debentures

Utility Securities

Kansas Utilities We

of $20,000,000 of

1,1978,

6Vs% debentures, due May

'

1,000,000 shares of common
of
Transcontinental
Gas

stock

Line Corp. is being made
today (Nov. 14) by two under¬
writing syndicates, both jointly
managed by White, Weld & Co.
and Stone & Webster Securities
Pipe

The debentures are offered
at 99.50%
and accrued interest,
while the common stock is priced

The company estimates

that

approximately

will spend

it

completing

in

$60,000,000

con¬

scheduled

work

struction

of

as

Aug. 31, 1957.
Upon completion
of this work the daily allocated

capacity of the company's system
will be increased from 753,550,000

cubic

to

feet

cubic

969,917,000

feet.

additional

the

of

Purchasers
common

shares will be entitled to

receive

a

which

10%

voted

was

dividend

stock

the

by

com¬

pany's directors at a special meet¬
ing on Oct. 16, 1957. The stock
dividend is payable on Dec. 30
to holders of record Dec. 16.
Transcontinental Gas Pipe Line

and operates an in¬
ter-state pipeline system for the

Corp.

owns

transportation and sale of natural
gas. Its main pipeline system ex¬
tends 1,842 miles from the Texas
Louisiana

and

Gulf

coast

the

to

Jersey-Philadel¬
phia metropolitan area. Applica¬
tions for increasing the present
allocated capacity to 969,917,000
cubic feet per day, exclusive of
gas available from storage have
been filed with the Federal Power

Commission.

application
FPC

with

the

further

ex¬

filed

October

in

another

addition

In
was

for

pansion of facilities designed to
ultimately increase the company's
total allocated capacity to 1,145,000,000

daily.

cubic feet of natural gas
It is estimated that the cost

of this

proposed additional expan¬
be

will

sion

The

$139,000,000.

company's gas sales, including de¬
liveries

from

ended

months
taled

for

storage

Aug. 31,

the

12

1957, to¬

approximately 247.1

billion

cubic feet, of which amount sales
totaled

resale

for

approximately

billion cubic feet and direct

235.5

sales

to

industrial

around

taled

11.6

customers
billion

to¬

Approximate Price

12 months

ended Aug.

31, 1957 the company had operat¬
ing

revenues

net

income

of

of

$92,587,880

26-22

$1.32

$1.30

Approximate Yield

5.6%

5.1%

5.6%

Recent Share

$2.93

$2.34

$2.08

5%

9%

6%

area

offers

a

to

chest

m
~

so

serve

much

opportunity

treasure
M

we

industry.

Earnings

Dividend Payout

12.6

11.1

11.1

70%

56%

63%

Approximate Common Stock Equity

34%

29%

31%

Moody Mortgage Bond Rating

Aaa

A

Aa

Kansas City Power &

tion.

Politz

which

Write for

growing

FREE

COPY
Box 899,

The

greater than the previous winter peak.

40%

is anxious

company

to reduce the spread between summer

A

peak and demands in other seasons.
has been placed in
for space

residential service rate

new

effect to encourage increased

heating, etc. The company suffered

a

use

of

elecjricity

brief strike over

a

issue this summer, but operations were maintained without

wage

interruption.

central

Kansas,

excellent transportation

where

650,000 in

259

communities

Wyoming




it should be obvious

cus¬

like

bank

This--was

confirmation of what1

a

already

believed.

We

if one would undertake an em¬

so

ployee sales campaign there must
be appropriate rewards to the em-?

also

ployees who bring in the business.:

On the basis of what

undertaking

are

we

;.

compensation,-

without

hard

too

we

that salesmen,

else, will not work:

anyone

important consideration.Tt-J*• Our experience has been that these*
campaigns are quite productive in.we 1 darned

most

a program•

■proportion to their cost,

of

employee training which is -designed to i m p rove the way * in
which

Now

personnelVthat

contact

our

others

who

bank's offices.
a

but

we

will

hope

never

to

public,

are

create

to

toward

us

organization are quite differwhich apply ml the,

ness

tWe'eyds

erit from those

of

ease

friendly feeling
institution.

officers. This was a mis-,:
principles which govern,
of credit to a busi-,

take. The

"the bank'?>khow

a

an

as

,

the extension

competition

meet

unless the people who, in

two about per¬

years ago

bv credit

through

with it, as we believe that wet can

of the

or

other instalment loans.>

most bank nia1}""
thought that since tkese
loans were a form of credit t
y;
should be made or administered,
A few

take ;&orne

going

are

/

agem ents

We know thaf dt is

which

process

time,

word

a

and

sonal

into'?cm-

come

!

'

-.

Personal Loan Changes

is, tellers, floormen, platform' Of¬
ficers, etc., treat our customers

construction of

gan

company's
plant,

area

new

Three major companies be-""

multi-million dollar installations in the

this year, including

a

cellophane manufacturing

jet and guided missile fuel refinery, and

a

a

ribbon factory.

The

company's revenues are about two-thirds electric and
nearly one-third gas. Electric generating capacity at the end of
1956

loans

»y..-

however, the

placed

company

a new

90,000 kw unit in test

tion in September after a considerable
Kansas

Power
over

for natural gas

Personal*

personal loan.

a

are

special form of bank-,

a

retail

are

&

most

kind

of

Thus

it

advertising

we

Light's

recent share

earnings

have

shown

heating, which

was

down nearly 18% in the second

and

communities

12

at

wholesale

in

southeastern

being about 466,000. Principal cities

area

Wichita, Newton, El Dorado, Pittsburg, Independence
City.

The

is mainly agricultural, buf coal, oil

area

the

is

that

learned

pay" for.

important.

direction

tion

of

its

of

broader

officer
his

learned

research

important
through

was

that

Since

a

our

bank

substantial

can

Boeing, Beech and Cessna—are currently expanding their opera¬
tions.
(While the "stretch-out" of the Air Force contract for the

but not

all, of

our

airplane will

into this

area

of electricity

no

gas

mean

a

slight reduction in recent peak

longer period of high employment under

contract.)

The chemical industry, which has

in recent years,

is reported to have increased

rapidly.

revenues

has

a

business)

were

8% higher than for the

(the

rate

raised

its

that

was

by

the fact

20% Pf our customers
(based on the, sample which was
studied by the Politz Organiza¬
tion) said they had been greeted

namewheri' transacting

their

number

name

the

116,000 kw will go into operation in the spring of 1959, increasing

their
the

The

people reported that 46% of

period of 1956 despite rather unfavorable weather conditions for

capacity about 24%.

busi¬

at our tellers' windows.

air-conditioning and water-pumping.

generating unit of

disclosed

only

ness

Trust

last

were

time

drug store.

greeted

fiduciary services.
Department it was

well-known

individuals

information

Same

new

•

-

market research

our

our

wealth and income

Among the other miscellaneous
of

discussjng

distinguished from

redistribution ot.
v-diich has occurred during the last *>-30 .years,
so'that the prosoects of develop
ing estate and trust business of.

the

3%, our savings depos¬
increasing by leaps and
4

as

recognized that the pension trust
and profit sharing trust were our,
big markets for future growth
Large estates have been £reat*y
reduced by taxation and also by

keep¬

to

are

same

A

In

payipg a substantially
of,.interest than we

bounds.

^

trust and other

Some,

Now that our rate has been

were.

by

for the first eight months of this
year

were

City has increased

expanding market for

services

customers who
were

York

New

the

customers. We have done

using other banks

were

bits

B-52 Boeing

in

other bank

something about that also.

corrective

nersonal loan business

not

percentagewise.e

render

it was obvious that we were
overlooking a rich market among

our own

necessary

our

.

and

only expanded, but oui.
share of the total of this business
has

can,

higher

Three important aircraft producers-

steos,

overhea

learned these tacts

the

took

fact—which
market

our

proportion of our customers were
also using the services of another

them

years.

tnc

platform where,

on an open

conversation will be

Since we

.<

tions because at that time some of

development in recent

company

r

ing their savings in other institu¬

ob¬

that

experience

cultiva¬

undeveloped markets.

Leading indus¬

The metropolitan Wichita area, from which the
company
tains about 60% of its revenues, has

by

of

improvement

aircraft, light metals, chemicals, cement, flour milling and

are

at-,
We

personal loan borrower wants pri¬
vacy to discuss his needs and sim¬
customer relations is the most im-;
ply will not come to the bank at.
portapt step any bank can take in
all if he has to talk to the.loaning,

we

packing.

use

a

most of them occupying

branches

private offices which are open
ter regular
banking hours

bank can. haye| -and
valuable supplement to the
any

Another

delay in getting parts.

last year despite relatively unfavorable weather

producing and processing

are

come

vertising

all the services that any

and Arkansas

meat

sormel who are

bank

tedly, this is the best kindvOf ad-t

bank.

gas

ing and should be

much of

any

Higher Savings Deposit Rate

Kansas Gas & Electric supplies electric service to 143 commu¬

tries

that

of

opera¬

quarter.

and

known

business

new

379,000 k;W, compared with peak demand of 352,000 kw;

was

served

well

is

It

(including

facilities have resulted in rapid growth oif

industry in the postwar period.

new

Electric

-

another.-

one

campaigns. But

rience in employee

far; the

why

found out that the- way id Which
are treated was-the nbxt

the

the current Air Force

Idaho

is by

reason

' >>/

I mentioned that it'

handled by perespecially trained,
Emporia, Topeka and Leavenworth) are served with electricity,.
in that field. 'Our bank lMrwd
/ comes in as the result of a'ykind this the hard way, and■ "°w we.
63 with gas and 49 with both. There is also a substantial amount
word or recommendation
spoken have trained personal loan spe¬
of wholesale electric service. The area has been largely rural, but :
for us bv one of our. customers to*
cialists at more than halt °f our.
a friend
or acquaintance. Admit-'
the development of oil and natural gas resources together with;
and

eastern

its

-

of location

of-

instead
had

how

Kansas Power & Light serves a population of over

Salt loke

& LIGHT CO.

Among the rhany
found out was that con¬

we

werg^

personal^
solicitation to o b t a i n so-called -v
consumer banking business except r
to a limited extent. An exception
to this role might be noted. Our
own employees are the best sales- :
men of special checking and sav-».
ings account s, and we have..
learned this through actual expe¬

looked to

we

we

not economic to use

was

were

way

important

and

Utah

Serving in Utah

the

merely

company's kwh sales were nearly

713,000 kw was reached, an increase of almost 17% over the 1956

peak and

A while ago

-our

found

we

again confirmed that
right in our judgment.

customers

experienced a
further substantial increase in peak loads this summer due to
greater use of air-conditioning equipment. A temporary load of

summer

;

a

of getting
questions
Out

course

tomers do business with

not very favorable, the company

employment, it insures

UTAH POWER

so

venience

last year despite some loss of business as the result of sale
company's Iowa properties on May 29, 1957. Iowa properties
over 10%
of revenues. While on an over-all
was

for

offices on Monday :

evenings, but the market research

customer.

most

accounted for

Dept. K
City 10,

not
and

over

basis weather

make

at these

acted

<

some

were

'

7%

so-called consumer business trans-

tivo

pleasant
things which
pleasant about our

and

bank

things

1960, increasing capacity about 48%.

of the

to

various

things which

hear

did'

we

study

posed,

we

some

-

the

to

answers

Electrieity contributes about 93% of revenues and gas 6%. The
company's three power plants have an aggregate maximum gen¬
erating capability of 728,200 kw. A 175,000 kw unit will go on the
line around mid-1958, and another is scheduled for operation in.,

had

very

>.*

We retained the Alfred

research

bank, and in the

,

evenings was shown to be
popular with the public. We
already were fairly certain of this*
because of the large volume ot,.

That also could iday

Organization

market

our.

opening neigh¬

Our practice of

at Manufacturers Trust

ago

Company.

•

In the first half of 1957 the

Open Monday Evenings

own

assumption.

And that is what

years

Light, the largest of the three companies,

ments.

ou^

,

be

good-be¬

are

-

.

have loyal and able em¬ borhood branch. offices between
and they know how to the hours of 6 and 8 p.m. on Mon-

erroneous

an

to

supplies electricity to a population of 750,000 in Kansas City, Mis¬
souri, and neighboring communities in Missouri and Kansas. Kansas
City, a rapidly growing city, supplies over 80% of the business, it
is estimated. In recent years the city has benefited by new bridges
across the Missouri River, new highways, and other civic improve¬

of courtesy and

The only way I know to find out
the truth is to engage the services
of an outside research organiza¬

64%

65%

55%

1951

likewise

small points
friendliness.

sonnel to observe the

cus¬

we

ployees

enjoyed substantial industrial

in

Colorado

,

Price-Earnings Ratio—

nities at

[explains why the
i

23

33-25

Kansas, population of the

AREA RESOURCES BOOK

26

$2.00

and

$14,599,01$.

P. & L.

36

40-33 Vz

improvement

For the

G. & E.

our

what they

that

relations

Kansas

Kansas

City

Dividend Rate

cubic

feet.

to say

us

be

York-New

New

cause

would,

handle customers.

Increase in Share Earnings since
-

for

easy

It

table.

Percent Increase over 1956

to be available for con¬

company

struction.

be.

not

are

price-earnings multiples which are quite reasonable as
compared with the industry average around 13, as indicated in the

Approximate Price Range

funds of the

added to the general

should

at

Recent

will be

balance

ttee

customer

P. & L.

share.
Net proceeds from the financing
will be used by the company to
repay all notes outstanding under
a
credit agreement with six

and

of the State. While these companies have shown
better-than-average gains in share earnings in recent years, they

Kansas

at $17.75 per

spite of the fact that

tomer relations

the greater part

Corp.

banks,

in

theless, the State has prospered in the postwar period with a sub¬
stantial gain in industrial development, and this is reflected in a
favorable record for the three electric-gas companies which service

sell

■ -

Business Development

"growth" area, never¬

noted as a

*

•

Cuit an er Relations and

Making Good Showing

While Kansas has not been

•

15

page

By OWEN ELY

And Stock Offered
Public offering

'

jrom

Transcontinental Gas

and

14, 1957

Thursday, November

...

.

by

they went to

This points out

necessity of training bank per¬

would

not

aPpe^,

those for the develop- [
pension or profit shar¬
ing trusts.-Our problem there was.
to extend our service to the smallbusiness organization and to
ways and means of reducing
cost of administering the invest¬
ments of small nension trusts. Wereached a solution about 2 veais
aeo
with
the
initiation of ou

bright

as

ment of the

"Group Trust Program,
which

the

funds

of

througn
small

many

pension trusts are co-mingled
investment purposes.

for

The last hur-

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

(2135)
die

had to

we

clear

tax

was

ex¬

Service that

The

Group Trust

our

exempt from income taxation.

was

The result is that

small

a

business,

or

Continued from page 4

Continued from page 2

emption, but after months of ef¬
forts and negotiation, we obtained
a
ruling from the Internal Rev¬
enue

so

to be tax

as

ly, and enjoy

ex¬

strong local

a

empt of itself, its investments
be managed

without

through

tax

can

trust

a group

additional

In conclusion

,

The

mar-

iforniaemba?ked

indicating that the market for this

explaining

the

which

bank

our

but

of

ways in
endeavored

kggt»

need.

times

At' the

have
time

same

which

they might need
they might be un¬

We have decentralized the

work of

making calls

on

our cus¬

tomers to the point where in 1956
our
branch officers made a total
of

43,000 "goodwill" calls

customers
total

a

in

of

addition

33,000

useful tools

small

the

we

making
calls

on

One.of the

have develoned is

pocket-size folder listing

68

services

renders

to

which

bank

our

the

public. This is a
reminder
to
the
officer

handy

making the call and
memorandum

a

their

on

to

more

prospective customers.
a

in

may serve as

the

hands

of

the prospect, who may or may not
know of all the

things

we

can

do

our

now to

summarize—here is

philosophy

and approach to
Development and Cus¬

Business

tomer Relations:

(1)
their

To know

markets

our

and

characteristics.

can

it

our

competitors do

so.

to handle customers and

produce

bank.

others

goodwill

for.

the

\

maintain

customers

contact

through

with

personal

calls.

'

(6) To be constantly
to

so

being developed and tested
will in future years be found in

now

discover

our

weak

points

Gamble

minimum

of

emphasize
neve

Company

famous

statistics and

such
P

maKe

stock

G

&

try to

a

I

aa

with

added

an

Crisco

fortune

top

and

to

to

know

management

observe the

of these

of

years

high qualities

and efficient office building. Consis,tent Tyith the far-sighted policies

of;this company they provided in
structure, expansion

S^°n^tieSelopjj

every

man

ment group

S88

Dvl?

the

in

has

labor

had

a

relations

labor

major

their

■

the

modity — money — is worth more
today in terms of interest rates
than it has been in 25 years. This
situation
calls
for
alertness
on

today

has

twp'plans pioneered by P & G
only

pait

its

ol

program

do

go

for¬

we

shall

we

SEBRING,
Morgan has

Mass. —John P.
affiliated

now

Middlebrook

&

with

merjy

with

Incorpor-

He

was

Barrington

for-

Invest-

,

Fla.

—

W.

joined the
McRae, Inc.,

George
staff

of

Haskins

p/& G opeiates

highly

in a

com-

has spent and

exoenditlirps

according

'

each

other.

and

and, with

'

.

TWO With Illinois Mld-Cont.

to

-

of

been

added

to

San¬

the

staff

Company, Ingraham

&

Three With Sutro Bros.

realizes

50%

of

BEACH, Fla.—Raymond
Barren, Earl R. Elliott and Fred
W. Hagar have become asociated

F.

Co., 316 South

-

have

and

its

one

,'

,

and

•

g.

Edwards

Ei

hth

New

products that were
in,fexistence 15 years ago.
-

become

^T6

present

from

June tfO

(Special toXfiE Financial Chronicle)

_

October.

five times

It

the number produced

compares

with

104,987

117,583 in the like week last

in

year's
was

Pas¬

pace.

127,991 units,

in the first week

the

preceding week

of

and

year.

Automakers

are still taking about the same
tonnages as they
recently, but steelmakers are prepared to give quick delivery
orders. They are handling inquiries in less than 60 mintues.

on

Mills
all
not

opening books for first quarter orders on virtually
But incoming .business is light, and producers are

are

products.
too

confident

a

this quarter.

pickup of substantial proportions will
/

come

Sheets and bars have been in easy supply for months.

Shapes
plates, which have been in critical supply, are getting into
better balance rapidly.
The move reflects seasonal slackening
and

activity, including highways and bridges.

inquiry for sheared plates is leveling out, with
capital expenditures dipping. They still hold substantial backlogs,
but pressure is off the market.
Heavy shipyard needs are ex¬
pected through next year, but utility work is down. Chemical
requirements are not as active as they were a year ago and railroad
car

needs

say

are

off.

The

publication said imports of structurals and tubular goods
are declining, but wire mill products, and especially the merchant
items, continue to cause headaches. Foreign barbed wire sells for
as much as $3 a spool less than the United States product; fencing
is $20 a ton cheaper and nails are $30 a ton under the domestic
price.
imports of steel mill products are equal to only 1.5 or
States production, but competition depends upon
the product and geographic area it is concentrated in. It estimated
1957 imports would average 115,000 net tons a month, compared
with monthly averages of 112,000 tons in 1956 and 181,500 tons in
the record year of 1951.
'
2%

of

United

In

reporting

.

,

the place of small business in our future,
"Steel" estimated that small plants would do $47,000,000,000 in
metalworking business this year out of a total of $138,000,000,000
metalworking volume. It said that small metalworking plants of
20 to 499 employees have about doubled in number since 1946.
In 1946, there were 12,720 plants compared with 23,962 in 1957.
on

Disinterest of consumers
the

twelfth

consecutive

has forced scrap prices down again
week.

"Steel's"

$2, putting it at $33.33

a

composite dropped

gross ton,

the lowest

Mo.

—

George

_6_

.

Jasper

American

Iron

and

Steel Institute

announced that

the

_

A.

of steel companies, having 96.1% of the steelmaking capacity for the entire industry, will be an average of
operating

E.
.

DePaul

associated
&

street,
'

York

Sons,

with

409

rate

77.5% of capacity for the week beginning Nov. 11, 1957, equivalent
ingot and steel for castings, as compared with

to 1,984,000 tons of

78.0% of capacity, and 1,996,000 tons (revised) a week ago.

members

of

Midwest

Stock

Earnings Per

Divs. Per

Retained Earns.

Sales

Common Share

Com. Share

Per Com. Share

190,523,237

*1.13

*0.633

*0.497

1940

213,729,797

*1.46

*1.00

*0.46

632,886,270

*3.17

*1.625

*1.545

1,157,389,726

3.44

tb85

1.59

was

cash

stock

dividends raised

splits:
to

S'J.OO

P/i-for-l
per

year.

in

1950;

2-for-l

in

lf).">(j.

tCurrent

production rate for the weeks in 1957 is
of 133,495,150 tons as of Jan. 1, 1957.

capacity

the rate was 80.9% and pro¬

A year ago )the actual weekly production
placed at 2,466,000 tons or 100.2%.
tons.

operating

rate

is

not

comparable because

capacity

is

higher than capacity in 1956. The percentage figures for 1956 are
based on an annual capacity of 128,363,090 tons as of Jan. 1, 1956.

Electric Output

Extended Its Gains of the Previous Week

The amount of electric energy

and
was

for

annual

For the like week a month ago

The

Dollar

*-1950_:

^Adjusted

on

duction 2,070,000

Exchanges.

1930

1957

based

the
.

and

The industry's ingot

A.

North

was

formerly with Goodbody & Co.




that

are

Fiscal Year End.

PALM

Elliott

production is already ahead of last
output in the week ended Nov. 2

car

than

The

'

_

LOuiS,

TT._,

products

new

is shown in bold relief when

not

Mr.

*

(special to the financial chronicle)

ST

Hibbard

G's ability to produce

successfully market

sales

Road.

laboratories,

however, topped the
seasonally-adjusted

the

on

since December 1954.

street

_

inventories,

goods industries,
major segments.

*

D.

Building.

Sutro Bros. &

Co., 676 St.

Two With A. G. Edwards

households.
P

Fla.—George

more

last week another

housewives

and

September

ob¬

agency

Operations This Week Scheduled to Yield
77.5% of Ingot Capacity

Continent investment

steady flow of prod-

in

The

basis, while falling from August levels.

for

:

sales

period

ac]ded (0 the staff of Illinois Mid-

C1

provides^
products,
tailored
to the
changing
needs
of
American

(Special to The Financial CHroNicLE)

(Special to The Financial Chronicle)

chicAGO, 111. - Art Smith Jr.
arK[ \yard G. Saunders have been

its

needs

ti

formerly
Coburn &
Incorporated,
was

loca[ repi.esentative for

marketing, the
recognizes the varying

company

tastes

In

He

street.

jynddlebrook,

mai-kets its

a

,

associated

become

wUh Hemphill, Noyes & Co., 340
jyjajn

spending millions

is

has

sher

g

company

year.

It said

(special to the financial chroniclf)

petitiye industry and is geared for
strong competition. The

ucts from its research

Silk & Co. Add

..

Scher With Hemphill Noyes

man-

™any.
products
as
individual
brands which often compete with

Building.

County

is

WORCESTER, Mass.—Franklin

j

With Lincoln McRae

with

1

ments and Gibbs & Co.

aged business enterprise in Amer-

m-g.

(Special to The Financial Chronicle)

and

1

Mlddlebrook

-

In'February, 1957, the American
of Management named

Procter & Gamble "the best

Manufacturers'

year-earlier

in structural

**.111

ated> 390 Main Street.

total

leading advertising trade journals.

of-Sills

.

c0hurn

today.

try,fohyears and ranks 1-2 among
domestic corporation in advertis-

if

not

has

.

Albetski

are

banks,

ward, it is very likely that
go backward.

ders

the

to

(special to the financial chronicle)

These

0ll\l,r0s[''irc,i
a."c' manufacturing
skills^ In sales it has led its indus-

MIAMI,

justifiably look

can

WORCESTER,

plan.

$200,000,000 below September of last

served that the bulk of the
drop came in durable
where lower
rates--of-ordering occurred in most

Makers

_

guar-

couise,

has

pattern

future witll confidence,

com-

fronts by all those who particinate
in
the
management
of

many

E.

growth

re-

Institute

Competition in banking is keenertoday than it has been for a long
time, because our principal com¬

Lincoln

products through

*hf
United States and in 1923 put
mto effect its well-known

employee benefit

drive for new

management

been set and investors in P & G

a

and

otye«ntaS pS

With Loburn

employment

August

and

Auto

seeking both constrong growth

party* has. the oldest profit sharing
plan in continuous existence in

anteed

Government agency reported new orders were
$26,800,000,000 at the end of September, down $500,000,000 from

have

j^ter

ailcj

enjoyed

The

■

This

They will have to buy any steel they use since their inven¬
are abnormally low.
Currently, they are at a 12-to-15-day
Normally, they are 30 to 33 days.

difficulty

for njore than 60 years.

Manufacturers' new orders in September on a
seasonally
adjusted basis fell'from August and from
September, 1956, the
States Department of Commerce stated.
i

United

steadv sales growth and

eo«cy

grown up in the

n.

s

sources there.
At the same time,
Mercury's Mahwah,
J., factory, strike-bound since Oct. 9, went back to work on
Monday of last week.

magazine of metal working said automakers are
cars for dealer stocks and to prepare a backlog against
possible labor troubles at midyear.

ior die defensive character of an
investment stock.
Coupled with

manage-

i
i
u
Procter & Gamble
has

..

assembly

N.

senger

pVo's

?5aCl1Ce °
leadership from with-

its

g

seen

Pin-It Home Permanent
Charmin Paper Products

and

buying in September-October combined exceed

The

level.

servatism

the industry's 1958 models
successful 1957 model clean¬

cleanup period reverses the January-August trend which
sales merely run
parallel to last year.
reporting service further noted that labor unrest con¬
tinues to cloud the
factory production outlook. A strike closed
Ford's Louisville
assembly plant last week, hitting Ford and Edsel
had

tories

are

auto

saw

a

The

trends.

its own organization and virtu-

m

that

Lilt Home Permanent

vestors who

of

The weekly

accompanying table should
most revealing to potential in-

be

for many years.
They
closely knit group, modestly
proud of their leadership in industry and fully conscious of their
a

578,000

building"

The

facilities

that

High production schedules for the automotive industry over '
the next several months will nudge
up flat-rolled steel demand,
but ingot production will remain at a somewhat
modest level,
"Steel" magazine stated on Monday of this week.

Shasta (shampoo)

moved

this beautiful

up

Steel

Duncan Hines Baking Mixes
Big Top Peanut Butter
Crest (toothpaste)
Gleem (toothpaste)
Prell (shampoo)
Drene (shampoo)

Just within the year
into their new

men.

they have

most

for

added

like 1956 by 92,000 units.

are:

(shortening)
(shortening)

Fluff o

My1 home is Cincinnati, O., the
executive headquarters and birthpiace of P & G.
It has been my
good

"Ward's"

already have been built, climaxing

be-

growth potential seldom found.

their

name

on
their sales,
top quality ^ Among these products

factors

investment

Ivory Soap, the most
in soaps, P & G also

mato and markets many products
classified as soaps or synthetic
detergents which account for about

1

and

them.

for

households
throughout America
In addition to

The Procter '&
Company I will use a

a tune of 63%
by the two producers, Ford and Chevrolet, is
largely attributable to this year's light-duty truck sales and tneir
strength in this reviving market."

...

with a b o u t 200 highly tiamed
chemists and technicians. Products

In'; discussing

of

the alert

on

Gamble

.

mdfs fl/om F\^£atlU11S ®Ja.ffed

'

The Procter &

,

.

P & £ s1n1ew *nd modern basic
research laboiatoiy, located 18

•.

'

.

ally

(4) To train-our personnel how-

correct

_

oppor-

State of California to your
of "securities you like

excellent

our

unusual

an

■"+ ALFRED R. HILL

do for it.

To

is,

been great]y reduced,
J

list

not

(5)

„

?ii bo!?ds Wl11
SUPP?V and will, of necesbe priced to appeal to in-

them before

to

;V

5

(3) To analyze the needs of the
public as they develop, and serve

as

Pr°A

h

Partner, Hill & Ce„ Cincinnati, Ohio

\

(2) To let the public know what
we

are

.

are

for him.
And

sity,

select

various

changing

which

aware.

■

of the

we
have not neglected our pres¬
ent customers in terms of the new

services

k

synthetic detergents. As a result of
virtual revolution in
the industry, new and more stable
sources of raw material are used
and the hazards of inventory have

'

-

fox..which
a

1957

l3 *1

-

marketed by

was

Procter & Gamble. Today approximately 80% of Packaged washing
Products, used in American homes

tunity to add general obligations

to develop its business by tapping
new markets in
offering services
created

?*

detail in

some

has

ia

holcl detergent,

iq?r

vtaiors.

Calls

into

lS

principles of soap
not changed from

had

Industry

to

Biblical times until 1933 when
Dreft> the first Packaged house-

financW

a

<R?nn nnn nnn

cimimr

really there.

*

Goodwill

on

basic

making

Cat

of

t y

eff

I have gone

State

program starting in January

HiippH

service is

the

burdens.

This plan has proved to be very
popular indeed and our advertis¬
ing of it has brought in a surpris¬
ingly large number of inquiries,

The State of Trade and

Security I Lihe Best

nonprofit organization for that
ket.
matter, can proceed with the set¬
(13) Bonds are rated Aa by
ting up of a pension or other em¬
ployee benefit plan, and if the Moody's and A1+ by Standard &
Poor's.
plan complies with the Internal
Revenue code

35

power

distributed by the electric li^ht

industry for the week ended Saturday, Nov.
at 11,914,000,000 kwh., according to the

estimated

Cnntrmipd.

nn

9

1957,

Edison
nnnp

36

36

The Cormnercial and Financial Chronicle

(2136>

Continued

from

Demand for

35

page

The State of Trade and

Industry

Output the past week increased above tne itvel
o£ the previous period.
The past week's output rose 54,000,000 kwh. above that of
the previous week and advanced by 392,000,000 kwh., or 3.4%
above that of the comparable 1956 week and 1,036,000,000 kwh.
Electric Institute.

the

over

Car

week

ended

Nov.

12, 1955.

1957, totaled 713,994
a decrease of 86,373 cars, or 10.8% below the corresponding
week and a decrease of 90,267 cars, or 11.2% below the cor¬

cars,
1956

for the week

responding week in 1955.

Automotive

ended

Nov. 2,

'

Operations Rose 9% Last Week Establishing
Eight-Month High for the Period

An

output for the latest week ended Nov. 8, 1957,
"Ward's Automotive Reports," reached the highest
level since the March 18-23 period this year by a 9% gain in
passenger car assembly. The past week found 50% of the indus¬
try's assembly plants still on a Saturday overtime basis.
Last week's car output totaled 137,404 units and compared
with 126,139 (revised) in the previous week. The past week's pro¬
duction total of cars and trucks amounted to 159,821 units, or an
Automotive

according to

12,458 units above that of'the preceding week's out¬

increase of

"Ward's."

put, state's

Last week's car

i
output advanced above that of the previous

11,265 cars, while truck output advanced by 1,191 vehi¬
cles during the week. In the corresponding week last year 132,087
cars and 21,190 trucks were assembled0.
Last week the agency reported there were 22,417 trucks made
in the United States.
This compared with 21,226 in the previous

week by

week

21,190 a year ago.
Canadian output last week was placed at 6,610 cars and 1,576
trucks.
In the previous week Dominion plants built 6,205 cars
and 1,324 trucks and for the comparable 1956 week 7,245 cars and
1,609 trucks.

Shipments 5.1% Above Output in Week
Ended Nov. 2nd

Lumber shipments of 485

reporting mills in the week ended

Nov. 2,

1957, were 5.1%o above production, according to the Na¬
tional Lumber Trade Barometer. In the same period, new orders
4.0% below production.

were

stocks.

Unfilled orders amounted to 28% of
Prpduction was 1.0% above; shipments 3.0%? above and

orders were 1.3% above the previous week and 0.2% above
production for the like week of 1956.

new

Business Failures Rose

Moderately for Week and
Substantially Above a Year Ago

Commercial

and

industrial failures

to 266 in

rose

preceding week, Dun & Bradstreet,
This increase lifted casualties considerably above
a year ago and the 207 in 1955. How¬
total remained slightly, 1%, below the 269 failures

reported.

the 219 in the similar week

the

ever,

which

in the comparable week of pre-war 1939.

occurred

Casualties

involving liabilities of $5,000

to 222 from 2Q7

last week and 194 in 1956.

Little change appeared

failures with liabilities under $5,006, which edged to 44
from 43 in the previous week, but they exceeded the 25 of this
size a year ago. Twenty-one businesses failed with liabilities in
excess of $100,000 as compared with 18 last week.
Week-to-week upturns prevailed in five of the nine major
geographic regions.
In the Middle Atlantic States, casualties

among

climbed to

92

from

77, in the South Atlantic to 25 from 19, in
New England to 18 from 12.
Mild dips were reported in four
areas, including the Pacific States, off to 67 from 73 and the East
North Central States, down to 27 from 35.
Failures exceeded
their 1956 levels in most regions; only three reported totals be¬
low

last

year—the East North Central, East South Central and

Pacific States.

Rise of the
Another

moderate

Preceding Week

advance

Bradstreet wholesale food price

compared with $6.16

a

last

values

the

Dun

&

index for Nov. 5 to $6.18.

This
gain of 3.9%
The 1957 low was $6.08
a

figure of $5.95.
May 14, while the high point was reached on Aug. 6 at $6.39.
Moving up in wholesale cost during the week were flour,
wheat, rye, oats, lard, butter, milk, coffee, cottonseed oil, cocoa
and hogs. Lower were corn,
sugar, eggs, steers and lambs.

on

The index represents the sum total of the
price per pound of
31 raw foodstuffs and meats in general use and its chief function

is to show the general trend of food
prices at the wholesale level.

Wholesale

Commodity Price Index Declines to
Lowest Level in Two Years

The

general commodity price level dipped

again

last week

commodity price index,
compiled by Dun & Bradstreet, Inc., finished at 276.68 on Nov. 4.
was

ago.

It compared with 234.32
Grain

down

from 277.07

Trading

active with some of the buying based on bullish
prospects. Warehouse stocks at New York at 204,593

was

African crop

week

earlier

and

281.90

a

month

on the corresponding date last year.
generally, except for wheat, trended lower
Export demand showed little if any improve¬

and

buying for domestic account was disappointing. A
strengthening factor in wheat was the heavy movement of wheat
'from interior points to terminal elevators to make storage space
available for new crop grain sorghums and soybeans. Cash corn
markets were sharply lower as the result of pressure from new

'crop marketings.

(prices

were

Although marketings of oats

were

very

easier in sympathy with other, feed grains.




small,

Co., Carew Tower, mem¬

irregular a week ago. Trading
in the early part of the week was stimulated by fears of further
crop damage due to cool weather and rains, particularly in the
Southeast. In line with trade expectations, the mid-October cot¬
ton parity price held unchanged at 37.06 cents a pound.
Cotton
loans in the week ended Oct. 25 increased to 135,344 bales from

Cincin¬

bers of the New York and

nati Stock

Exchanges.,

;

]$

%

Form Southern Planning

*

4

(Special to The Financial Chronicle) -

Fla.
—
Southern
Planning
Corporation
has been formed with of fides at
FT.

LAUDERDALE,

60F Gorial
as

Shopping Center to act

dealers in mutual fund securi¬
Officers

ties.

are

G. A.

J.

P.

Coffin,

Vice-

CV Coffin,

and

President

Cotton price movements were

Chronicle)

CINCINNATI, Ohio—William F.
Reid has been added to the staff

President;; M.

bags compared with 338,368 bags a year ago.

Treasurer;1

and

Dickinson, Secretary.

%

101,905 the week before. Withdrawals from the loan in the latest
period were given at 8,500 bales, leaving 532.331 bales of 19o7
cotton in the Government loan stock on Oct. 25.

crop

Despite adverse weather conditions over the past month, the
crop appears to have held its own.
A preliminary esti¬
the "Journal of Commerce" as of end-October placed the
yield at 12,500,000 bales compared with last month's United .States
Department of Agriculture estimate of 12,401,000, and the 1956
production of 13,310,000 bales.
cotton

mate by

A

of forward buying involving tens of

wave

millions of yards

developed in the primary cotton cloth market late in the week.
Interest centered around cotton print cloths with most transac¬
tions

reported at

lower price level.

a

Trade Volume Aided

by Election Day Sales Promotions

And Good Weather in Past Week
Stimulated

weather

in

%f you're feeling

very

well

by Election Day sales promotions and favorable

buying rose appreciably last
week and volume edged somewhat ahead of a year ago. There
were moderate gains from both the previous week and the sim¬
ilar 1956 period in sales on men's and women's apparel, furniture
and floor coverings, while purchases of major appliances, tele¬
vision sets and linens remained sluggish.
A further rise in the
buying of 1957 model passenger cars cut again into dealers' stocks.
many

areas,

consumer

of retail trade in the period

ended
below to 3% higher
than a year ago, according to spot estimates collected by Dun &
Bradstreet, Inc. Regional estimates varied from the comparable
1956 levels by the following percentages: Middle Atlantic States
+3 to 4-7%; West North Central 0 to +4; East North Central and
West South Central —1 to +3; East South Central and New
England —2 to -f2; Sctath Atlantic and Pacific Coast —4 to 0
The total dollar volume

on

Wednesday of last week

Furniture

was

from 1%

stores

orif you're feeling queerlg)

week
earlier in the buying of dining room sets, case goods and uphol¬
stered merchandise. Retailers registered substantial gains in floor
coverings, electric blankets and slip covers, but interest in linens,
draperies and towels dwindled. Sales of refrigerators and dish¬
washers lagged again last week.

of

noticeable increases from

reported

a

slight gain in the call for frozen foods, fresh produce
goods, overall food volume remained close to that
There were moderate declines in volume in

Despite
and

a

canned

the prior week.

most dairy

products, poultry and fresh meat.

Wholesalers in many markets reported a slight rise in orders
for women's Spring wear and volume was close to that of a year

However, bookings in Spring dresses were sluggish. There
moderate gain from a week earlier in the call for men's
Buyers somewhat stepped up their buying of
women's fashion accessories and sweaters, anticipating the Christ¬
mas season.
Slight year-to-year decline? occurred in purchases of
ago.
was

a

Spring clothing.

children's
A

merchandise.

tifjt'sMving.yomvantmotQ ]■
>'

increase was reported in wholesale buying of
during the week, but interest in draperies and
linens was sluggish. There was an upsurge in orders for lamps,
lighting fixtures and decorative lighting equipment for Christmas.
and

noticeable

coverings

a year ago.
Purchases of
furniture slackened during the week.

major appliances

Although transactions in carpet wool, woolens and corduroys
appreciably, trading in worsteds lagged. Despite some
scattered orders for print cloths, bookings in cotton gray goods
were unchanged from the level of a week earlier.
Some Southern
mills plan shutdowns during the Thanksgiving and Christmas
holidays, as a result of sluggish orders. Several dyeing and fin¬
ishing plants in New England reported a slight improvement in
advanced

new

JHe

....

orders.

have

Increased

buying of flour,

rice

and some

dairy

products

a

'

;

V

checkup-yearly

> ••

boosted total volume in food at wholesale.

Department store sales

on a

country-wide basis

as

taken from

the Federal .Reserve Board's index for the week ended Nov. 2,1957

period last year. In the preceding week,
Oct. 26, 1957 a decrease of 1% was reported. For the four weeks
ended Nov. 2, 1957 a decline of 1% was reported. For the period
Jan. 1, 1957 to Nov. 2, 1957 an increase of 2% was registered above

Many

cancers can

Retail trade sales volume
rose

about

5%

in New York

City the past week

above that of the similar period

in

1956, trade

observers estimated.

Election

Day

provided

it's important for you to have
a

thorough checkup, including
a

chest x-ray for men and

a

pelvic examination for

impetus

for

tin?

week's

good

According to the Federal Reserve Board's index, department
store sales in New York City for the weekly period ended Nov, 2,
1957 increased 6% above that of the like period of last year. In
the preceding week, Oct. 26,-1957 an increase of 1% was reported.
For the four weeks ending Nov. 2, 195.' no change was registered.

For the period of Jan.

women,

each and every

year ...no matter

the

showing.

a

be cured if

detected in time; That's why

that of 1956.

markets

during the week.
ment

a

Inventories of roasters in the United
1,150,000 bags, the lowest in two years.
moderate gains during the period.

declined 2% from the like

to reach the lowest level in two
years. Contributing to the decline
were
lower prices for hogs, steel
scrap, gasoline, hides, rubber,
cotton and wool.
The daily wholesale

This

mar¬

further

made

Sales exceeded those of

brought

week previous and marked

the comparable 1956

over

week

in both the actual and futures

up

demand broadened.

as

Cocoa

floor

Wholesale Food Price Index Extended Its Moderate

'

prices firmed

14,1957,

Hill & Co. Adds
(Special to The Financial

of Hill &

Trading was
small and the tendency among most buyers was to
draw upon balances as long as possible.
The downward pull in
the domestic raw sugar market was still in evidence as prices
softened in slow trading.
World sugar was lotver although the
market was somewhat more active as the week closed.

increased

more

or

* '

'

and Mountain States —5 to —1%.

the week

ended Nov. 7, from 250 in the

Inc.

i

extremely

and

Lumber

-

4

.Thursday, November

fair, with offerings light and

Interest in the domestic flour market was dull.

States were estimated at

Loadings of revenue freight for the week ended Nov. 2, 1957,
10,306 cars or 1.5% above the preceding week, the Associa¬
tion of American Railroads reports.
Loadings

markets.

kets

were

was

prices holding steady. Despite a noticeable decrease of primhry
receipts ar.d producer marketings cash soybeans continued their
downward trend reflecting weakness in the soybean oil meal

Coffee

Loadings Rose 1.5% in Latest Week But Were
10.8% Under the 1956 Period

malting barley

..

1/ 1957 to Nov. 2, 1957 the index recorded
gain of 3% above that of
tli^ corresponding period of 1956..

how

well you may feel.

AMERICAN CANCK c:::-TY

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

(2137)
Continued

jrom

5

page

the condition is defined
market.

successive
ket
•

II

wars.
But, ? even though he was
right in his economics and busi¬
ness
forecast, he was neverthe¬

the current market decline.

less wrong

of Standard

for

regarding the market;
market dropped 22% in

the

and

J 946

continued : its

until

behavior

late

completely

ning

business

boom.

bearish

1949

run¬

—

to

the

Outbreak of

war

counter

furnishes another, example of the

difficulty of drawing the correct
conclusion

market

from

the

cor¬

rectly predicted outside economic
or

political event. Throughout the
eight months of 1939, those

first

expecting the outbreak of

World

a

sold

War

stocks, but the actual
occurrence of the event was fol¬
lowed

by an immediate market
rise, averaging 20%. On the other
hand, the Korean outbreak in 1950
greeted by

was

market drop of
•: v.

a

15%.

.

Uncertain

Now,

Inflation

word

a

Impact

about

inflation's

uncertain market impact.
flation

also

factor

The in¬

manifests

the

difficulty of making short-term
market assumptions from a correct
economic

long-term

prediction,

particularly when stocks

out

are

offline from value criteria. There
instances of

are many

severe mar¬

ket falls in the midst of

tionary environment.

infla¬

an

During the

war-time inflation of 1917
nevertheless broke 50% in

stocks

a seven

stock buyers, for years
ratio

of

end

the

really

hold

took

commodity

and

economy

War

World

second

inflation

the

prices rose by 40% and the cost
living by 30% — stock price

of

nevertheless, fell by 10%
Likewise, over the longer

average,

ne'tv

from

term
there

was

1929

to

when

1950

52% rise in commod¬

a

ity prices, nevertheless, there was
net decline of 40% during that

a

Even

overall

-

corporate

profits

constitute another example where
correct

prediction
changes in even

element

itself

in

achievement

a

short-term
quantitative

difficult

a

—

of

enough
not

do

—

necessarily supply the key to the
of the market

future

action

whole.

From 1946 to 1947 the per-

share earnings comprising

average

tant

the is¬

the

"IIow

The

a

Then there is the process where
cause-and-effect
relationship

between outside factors and
ket

performance

leaves

the time
of

terms

does
of

mar¬

exist;

such

but

effect

in

market performance

in¬
determinable. In other words, the
"how high is really high?" prob¬
lem. Thus several of the expert
witnesses at the Fulbright Com¬
mittee's
Stock
Market
Inquiry
back in March, 1955, cited fac¬
tors both qualitative and quanti¬
tative, to show that the market
was too high.
But, although the
demonstration

of

these

ly went
ing

up an

the

1955,

to

tered in

17

its

peak

March,
initially regis¬

August 1956.
collapse

the unfavorable dividend yield of
stocks
compared
to
bonds
has
been cited

important contri¬
and, correctly so.
highlights the constant
impossibility of determining the
buting

as

cause

an

—

this

But

time

when

come

effective in terms of market

such

factors

will

be¬

performance.

For.
significantly
dangerous narrowing of the stockbond yield differential went on,
but

disregarded or explained

away
by the avid bull market

was

(the

still

an

not

latter

presumably

anachronism)

must

the

wind

will

continue

Not

to

blow

that

way.

tual

whether

even

most

the

yield.

years, the
popular dividend paying

operate

on

overall decline

an

Although 13 of the

popular

issues

were

most

railroads,

nevertheless the industrial as well
the rail components contributed
to

the record, and a full one-half
of all the issues shrank
by 50% or

In

going

other

words, while the

market

as

whole

a

half the issues
down, and by over 50%.
as

480

whole

a

last

over

was

mar¬

year—

Standard & Poor's Index of

stocks

with

the

showed

rise

a

of

industrial section

4%,

gain¬

ing 6%. But the rails concurrently
lost 8%

1%%.

and

the

the

in

error

mathe¬

matical

principle of the maturity

of

chances

ing nhases—but the

Steinmet.z called the most mischie¬

the

data

and

the

on

the

public loves

Internal

vents

Market

Analysis

time limitation also

Now,

pre¬

from making more than

me

brief reference

to

of

some

the

fundamental fallacies embodied in
the

curent

pate

of

effort

mass

stock

means

the

there

complete

was

price

antici¬

to

movements

so-called

internal

by

mar¬

which

Professor

in

run

series, the

a

mere

of

"technical"

stock

in

is the

to the great

common

so-called

market

mass

methods

forecasting

implied major premise that

the future price course can be de¬
from

disregarding

its

past

the

behavior,

hard

fast

and

market

severe

breaks

there striking market

diver¬

6%;

32

ended

unchanged—while

368 issues lost up to 6%; 222 de¬
repetition by
clined from 6 to 10%, -and 306
itself
alters
the
mathematically
fell
by more than 10%.
correct odds concerning the prob¬
able outcome of the next event.
So, showing all these diver¬

fallacy
used

was

midst last month's

even

of

more

than 50%

probable to be followed

by

The

tail.

a

exists

in

misconception

same

most

systems

for

out¬

and

gences

going

in

contrary
several

movements

directions

(again in quotation marks) as a
whole.
Again referring to a parlyed bet, we see that those trying

witting the inexorable mathemati¬

to forecast the
must win two

bets—first,

on

right

market

a

red

turns

dice,
the

on

of black and

or

roulette

wheel.

at

onqp, certainly proves how impos¬
sible it is to predict "the market"

cal facts

of

the

on

market,

between

The

the

Now,

Dow

for

the

and

past

the

Theory

basic

technique

of
systems

definition

the

—

these

of

one

leading
more

as

being
whole

Theory.

It

holds

that

at

any

time the stock market is the

com¬

posite

three

resultant

of

The roulette

these

trends, to be charted and studied:

of

trend whose

a

course

over

the

next ticker quote or day, or week,

month, is evident from its past

direction.

Incidentally, when
beating

the

stock

a

system for

market

or

a

latter

identification

is

the

primarv ob¬

jective of the Dow Theorists, is
determined
by successive highs

Relying

of

lows

trend: and

the

converselv

—

Suc¬

averages.

The Market's

Divergence

secondary

solutely

Difficulty
egory

of

obstacle

weather

so-called

to

forecasting

market

as-a-whole.

of

the

stock

unit,

as

a

a

so-called

market

considered

reversals,

and

—

sucres-

termed

"the

market,"

(and

tal

long

each

as

stock

of the

trend.

successive

average

auotation

advance

First let

carries

showing

used

than

As

before it, and each successive sec¬

The

record

higher

]Qft1

higher

peak

ondary reaction stops at
bottom

trend

than t^e last, the

is

assumed

to

be

the
a

one

primary
and

up;

as

over

ui

the

shows

1Q3C

measured

aver«fec

say

around

it)

give you an example
this divergence within

market

a

marks

I

men¬

me

the

to

managed

by

the

of New-

York; Continental Illinois National
Bank &

Trust Co., First National
Bank, Harris Trust &
Savings
Bank, and Northern Trust Co., all
of

Chicago, made public offering
Nov., 12 of $20,700,000* Cook
County,
111.,
various
purposes
bonds, at prices to yield from
2.60% to 3.60%, according to in¬
terest coupon and
maturity. The
financing included $11,400,000
on

3%%
1958

bonds, due
to

1977

Dec.

on

300,000 3%s, maturing
from

1958

1

from

inclusive, and

to

1977

on

$9,-

Dec.

bonds

the

inclusive.

1

The

general

are

obligations of
payable as to both

County,

principal
valorem

interest

and
taxes

all taxable

to

be

from

levied

ad

upon

property therein with¬

in the limit provided

by law.

Also in the

underwriting group
following: Chemical Corn
Exchange Bank; C. J. Devine &
the

are

Co., First National Bank

of Port¬

land

(Ore.); White, Weld & Co.;
Shields
&
Co.; Paine, Webber,
Jackson & Curtis; R. W. Pressprich & Co.; City National Bank
& Trust Co. of
Chicago; City Na¬
tional Bank &

Trust

Co.

of'Kan¬

City (Mo.); Dominick & Dominick; Hirsch & Co.; Shearson,
Hammill & Co.; Trust
Company
of
Georgia; American National
sas

Bank

&

Trust

Co. of

Chicago;

Reynolds & Co.; First National
Bank in Dallas; Andrews &
Wells,
Inc.; Robert W. Baird & Co., Inc.;
Julien Collins

& Co.; Fitzpatrick,
Co.; E. F. Hutton &
Co.; King, Quirk & Co., Inc.; Shel¬
by Cullom Davis & Co.; DempseyTegeler & Co.; Rodman & Ren-

Sullivan

&

shaw; C. S. Ashmun & Co.; Ditt& Co., Inc.; Farwell,
Chap¬

mar

other

the

nothing.

Just

gives

vane

future

no

indication

direction

wind, charting of the past
bears

no

Advertising

is

one

of

the most useful tools in

the

as

securing

new

customers

the

of

course

relevance

So

it's

smart

to

place

to its future direction.

at least

or

that t^rm "the market" with

market

County Bonds

syndicate

your

advertisement in

THE

COMMERCIAL AND

very,

define

bear

A

First National City Bank

"patterns," they commit the basic

Now, here's another major cat¬ of

sivplv lower highs and low^r lows
a

Cook

on

as containing
Fortunately there is available
trend, overlook the
a way of avoiding the difficulties
very
fundamental obstacle
involved in timing market fluc¬
cessive higher highs and higher resulting
from the constant di¬
lows
constitute
a
hull
market vergences within that overall tent tuations that is fruitful as well as

and

$20,700,000 Issue of

resistance points, explosion points,

trend, whose T^ose trving to time movements of the market

The

Banking Group Offers

of chance goes awry, its fallacy of disregarding the hard
practitioner is quick to blame him¬ and fast line between the
past and
own faulty
interpreta¬
the future.
The popular
Dow
tion and excuse
the
Sacrosanct

1he

movements.
latter major

ary

second¬

bad value.

a

self for his

(3) The major trend, lasting
a period of years, and made
of a succession of higher or
and

ANY time is a good
buy a good VALUE; with
being a good time to hold

game

over

thrusts

that

time

no

essentially substitute hind¬

sight for foresight.

(1) The minor trend; or dayto-day fluctuations, forming lines system—a masochistic somersault Theory, the leading example, is
in either direction.
i. e., self-abuse as a device for useful for definition of the mar¬
(2) The secondary trend; last¬ maintaining one's emotional se¬ ket's
past and present action (as
ing for several weeks or months; curity through unshattered con¬
a bull or bear market), but
con¬
made up of a succession of higher fidence in the system.
or lower minor movements.
cerning the future it signifies ab¬

lower mabr

ciple

time to

man
& Co.; Fulton Reid &
Co.,
Inc.; A. E. Masten & Co.; John
along with other systems, follows by the internal market analysts.
Small & Co., Inc.; Dreyfus &
Co.;
the principle that the chances of
While offering the appeal of order Eddleman-Pollok
Co.; Federation
a succession of identical results are
Bank
&
Trust
out of uncertainty through pastCo., New York City;
other than even, thereby assum¬
and Frantz, Hutchinson & Co.
ing either extension or reversal performance pictorialization, the

or

At this point let me remind you
of the basic definition of the Dow

He will thus conform to the true
and constructive investment
prin¬

once more

and
second, on being right on
player often thus be¬
future. This error of the techni¬ comes bankrupted by an extra¬ some particular stocks within the
market.
cians
applies not
only to the ordinary run of the same color
til
chartists of Dow theory, of Ratio against him. Now if you will stop
to think you will see that the Dow
Conclusion
systems. Action Reaction signals,
Explosion points, Toneometers, Is¬ theory is based on the same fal¬
Actually,, valid signals are pro¬
land Reversals, sun spot cycle the¬ lacy, regarding the projection of
vided neither by economic indices
a
so-called trend from past be¬
ory; as well to the highly respect¬
nor by
technical factors adduced
able formula-timing practitioners. havior. Essentially the Dow theory

line

chases and sales.

v

reoccurrence of that

series of successive heads is

very

Again,
period

I

.

peated

This is the foible which leads
boys
who gamble on coin
tossing to vary
their bets in the .belief
that/ a

a

40%.

gambling superstitions. gence between the net changes.
For
This principle embraces the
during October, six stocks
psy¬
chological fiction of which Dow actually gained more than 10%,
seven
issues
rose
by 7%,
133
thinking is a variation. Namely,
that when there has been a re¬ stocks registered advances up to

analysis—but this being such
popular activity, we should
spend a little time on it. The basic

ket

to

of

vous

forecasting.

On

a

other,

30

tinuing disparities of their price
recurring oppor¬
tunities
for
advantageous pur¬

from value offer

the utilities declined

And

Let him further
the premise that con¬

went

up,

And take the record of the

ket

along with adequate

income

as

more.

of his capital

same

issues suffered
of 39%.

at

same

will

it

abortive results in their forecast¬

from

In the market's current

averages

up

additional 35% dur¬

months

and 20

low,

new

condition is called a hear market.
The final premise is that the
per¬
formance of the industrial and rail

commit

excesses

valid, the market subsequent¬

was

fact

one
and
becoming
ever
popular; the Dow Theory.

High Is High?"

a

each temporary rally ends at a
joint under the previous one, the
primary trend is down and the

constructive usefulness of the fac¬

technical

Obstacle

to

Nevertheless,
during the

disparity within industry groups!
Fulbright Committee in warning continue to blow for another day, American Cyanamid rising 18%
of the "high" market—when the that is, for another up-ticlc on the while Allied Chemical was falling
Dow-Jones Average was down in stock exchange ticker. Remember, 15%,
Continental €atr,,upr'20,%V'
the 380's; after which it registered the weather vane does not insure American Can down 12%; and so
on
continuation
of
all
its furtherf. big rise to 523.
the
wind.
Simi¬
through the list.
380
This year—from Jan.-1 through
recording of' a past-price
may have been high. But 523 was larly,
much higher—and after 17 months "trend" in stocks should not imply Oct. 25, while the market as a
of discomfort, if not embarrass¬ its continuation.
Stripped of its whole, composed of the 1,000 im¬
ment, to the would-be market surrounding copious jargon, the portant issues, was declining by
Dow principle is a logical absurd¬ 13%—the
timers.
drug, cigaret, and office
equipment groups were rising by
Small wonder then, that in the ity.
as
much
as
In effect, I am convinced that
13%; while, on the
output of the economic and statis¬
other
hand,
aircrafts,
airlines,
tical services there is a sharp con¬ essentially the market
technicians'
aluminums,
and
coppers, fell by
trast between on the one hand the assumptions about trend behavior,

and

time fell by 7%.

same

In

cited before the

was

the

yet

40%,

by

rose

signal.

danger
yield factor

of their market price range,

mean

at

a

carries

tripled in price from $64 to

time

1956.

the Dow-Jones Industrial

on

sues

as

mar¬

.Surely, at least at any time after a weather vane that shows which
October, 1954, when the ratio de¬ way the wind has been and is
scended
below
the
historically blowing, whether up or down the
significant 1.60 mark, it could hill. Actually it does not thereby
have been regarded as an impor¬ give any clue as to how long the

termined

period in the price of stocks.

& Poor's fifty indus¬

$184.

downsurge of the

a

so-called

in the midst of the 1937-38

on

This

most

each

as

index) after years of stability confirm each other. ;
began, starting in December, 1950,
Now, as a description of the past
a
change from 2.92 to a riskier and present this is useful, but as
relationship, gradually declining prediction it signifies absolutely
all the way down to 0.94 last July. nothing. It functions
merely like

period. There was also a
"halving" of stock market prices

when

preceding

the average yield

on

trial stocks related to the yield on
its
high-grade
industrial
bond

month

period
of monetary expansion. Similarly
in the post-OPA price decontrol¬
ling period of 1946-48 after the

(based

hull

when

Conversely,

37

long

that

logical.

as

by

the

industrial

t*"10

the

part owner of

lieu of

investor

stock¬

a

business.

dealing in changes in

In

mar¬

term. ket quotations, let him concentrate

between
on

whilp

Let

holder discharge his true functions

rwo-k«»t

Dow-Jones
stociva,

ai

evaluating individual issues
stake

in

a

purpose

of

securing

a

property, with

as

the

preservation

FINANCIAL
25

CHRONICLE

Park Place, Nevr

York 7

»

The Commercial and Financial Chronicle

...

(2138)

38

Thursday, November 14, 1957

ADDITIONS

* INDICATES
r

'

Now in

Securities

National Life Insurance Co.

Alabama

(letter of notification) 37.783 shares of common
stock (par 25 cents).
Price—$3 per share. Proceeds—
To selling stockholders. Office—Bessemer, Ala.
Under¬
writer—Joe S. Hanson, 794 Navy Bldg., Pensacola, Fla.

Oct. 2

stock
to be sold

(par one cent), of which 233,000 shares are
for account of the company and 23,300 shares

for the
President of the underwriter.
Price—$1.50 per share. Proceeds—For working capital
to be used in realty financing activities.
Underwriter—
Midland Securities, Inc., New York.
account of Ben Degaetano,

Hardware Corp.,

American

New Britain, Conn.
Nov. 5 filed 125,000 shares of common stock (par $12.50)
to be offered in exchange for not to exceed 250,000
shares of common stock of Savage Arms Corp. on the
basis of one-hall' share of American (plus cash), for each
Savage Arms share. The other is conditioned upon ac¬
ceptance by holders of not less than 100.000 shares of
Savage Arms stock not later than Dec. 17, 1957. Under¬
writer—None.
•

Israeli

American

Paper

Oct. 29 filed 6,000,000
Israel

(11/25-29)

Ltd.

Mills,

series B ordinary shares (par one
Price — $1 per share, payable

pound per share).

either in cash or in State of Israel bonds.

expansion

Proceeds—For

Office — Hadera, Israel.
Under-,
Higginson Corp., New York, on a best ef¬

program.

writer—Lee

basis.

forts

Provident Investors Corp.

American

shares of common stock (par one
Price—$2 per share. Proceeds — For working
capital and general corporate purposes. Office—Dallas,
Tex.
Underwriter—Peoples Securities Co., J. D. Grey,
of New Orleans, John S. Tanner, of Dallas, and C. L.
Edmonds, of Houston, three of the 22 directors, are
Chairman, Vice-Chairman and President, respectively.
Feb. 15 filed 50,000,000

cent).

AMI, Inc., Grand Rapids, Mien.
4 filed 114,323 shares of common stock (par $3),
with warrants, to be offered for subscription by common
Oct.

stockholders at the rate of
shares held
Nov.

15,

as

one

new

share for each four

of record Nov. 1, 1957;

1957.

Price

—

rights to

$9 per share.

empire on

Warrants entitle
share

holder to purchase one additional share at $10 per

each share subscribed for.

for

Proceeds—To retire 5%

mortgage note, 5% unsecured notes and to reduce bank
Underwriter—None.
Cage Trust, a trust organ¬

loans.
ized

the laws of

under

agreed to purchase

any

the State of Liechtenstein, has
unsubscribed shares.

Ampal-American Israel Corp., New York
$5,000,000 of five-year 6% sinking fund de¬
bentures, series F, due 1962. Price—At 100% of principal
amount.
Proceeds—To purchase machinery and equip¬
Oct. 14 filed

ment.

Underwriter—None.

Anita Cobre U. S.

A., Inc., Phoenix, Ariz.
Sept. 30 filed 85,000 shares of common stock. Price—At
par ($3.75 per share). Proceeds—For investment in sub¬
sidiary and working capital. Underwriter—Selected Se¬
curities, Inc., Phoenix, Ariz.
Artesian Water Co.
Oct.

15

(letter of notification)

3,404 shares of class A
par) to be offered for
subscription by common and class A common stockhold¬
ers of record Oct. 2, 1957 on the basis of one new share
of class A common stock fcr each eight shares of com¬
non-voting

common

mon

stock

Dec.

2, 1957.

stock

(no

Blacksmith

Shop Pastries
Sept. 17 (letter of notification)
tures dated Sept. 16, 1957 and
40,000 shares of capital stock

Inc., Rockport, Mass.
$100,000 of 6%% deben¬
due Sept. 15, 1972 and
(par $1) to be offered
in units of one $50 debenture and 20 shares of capital
stock.
Price—$90 per unit.
Proceeds—To retire mort¬
gage notes and for working capital. Underwriter—Mann
& Gould, Salem, Mass.
Brockton Edison Co.

Sept. 18 filed 30,000 shares of cumulative preferred stock
(par $100). Proceeds—To repay bank loans and to ac¬

quire securities of Montaup Electric Co.

Bids—Had been

Underwriter—Glick

trust bonds due 1987. Proceeds—To repay bank loans

more

than $7 billion. Stockholders here

own

amount to

than

more

$20 billion in securities. In this rich market, both the

professional investor and the general public read the
Chicago Tribune more than any other newspaper. To sell
Chicagoland, see your Chicago Tribune representative today.

CEtjicago QTribime
THE

WORLD'S

CRIATEST


America's most widely circulated


NEWSPAPER

market table

.

pages

•

(11/20)
$12.50).
Proceeds — To

debentures

working

Oil

*\

Refining Co.,

Inc.

(12/9-13)

additional facilities and to
Office—Ponce, Puerto Rico.
First Boston Corp., Nevw-York. ♦

capital.

240,000 shares of 5%% preferred stock and

4,000 shares of 4% second preferred stock.. Price — At
par ($25 per share).
Proceeds—To be added to general
funds.
Oliice—Kansas City, Mo.
Underwriter—None.

Caiiada Mortgage Bonds, Ltd., Englewood, N. J.

For purchase of mortgage bonds.

Continental

Underwriter—N one.

Oct. 10 filed

Canadian Prospect

Ltd., Calgary, Canada
Sept. 27 filed 4,851,810 shares of common stock (par
16% cenfs) to be offered in exchange for capital stock
of Canadian Export Gas Ltd. on the basis of 2% Cana¬
dian Prospect shares for each Canadian Export share,
subject to acceptance by holders of at least 80% of
Canadian Export shares outstanding. Underwriter—None.

Insurance

Co.

1,700,000 shares of capital stock (par $5) be¬

ing offered in exchange for capital stock (par $7.50) of
Firemen's Insurance Co., Newark, N. J., at the rate of 17
shares of Continental for every 20 shares of Firemen's
The offer,

stock.

which is subject to acceptance of not

of the Firemen's stock, will expire Dec. 2,

less than 80%

1957, but may be extended to Dec. 31, 1957.
Statement effective Oct. 31.

Underwriter

•—None.

4.
•

Corp. of America

Continental Screw Co.

(11/19-20)

Sept. 24 filed 300,000 shares of common stock (par $1).
Price—To be supplied by amendment.
Proceeds—To¬

July 12 (letter of notification) 120,000 shares of common
stock (par 10 cents). Price—$2 per share. Proceeds—For
machinery, equipment, inventory and working capital.
Office—701 Monroe St., Hoboken, N. J.
Underwriter—
Paramount Securities Co., One Exchange Place, Jersey
City, N. J. Offering—Now being made.

gether with funds from sale of $1,500,000 6% bonds (with
stock purchase warrants), to purchase
assets of old
Massachusetts corporation and of Hy-Pro Tool Co. Un¬
derwriter—Lee Higginson Corp.,

Boston and New York.

Cooperative Grange League Federation, Inc.

Carter-Jones Drilling Co.,

Inc.
Sept. 27 filed 300,000 shares of capital stock (par 10
cents. Price
$5 per share. Proceeds—To repay bank
loans
and
other
indebtedness; to participate in the
acquisition and exploration ol oil properties in joint
venture arrangements with other companies in which
the company does not propose to retain more than a
25% interest or assume more than 25% of the risk; and
for general working
capital.
Office—Kilgore, Texas.

of 4% subordinated debentures
10,000 shares of 4% cumulative pre¬
ferred stock par $100; and 150,000 shares of common
stock (par $5). Price—At principal amount or par value.
Proceeds—To finance inventory purchases, to make cap¬
ital loan advances to retail subsidiaries; to reduce bank
Sept.

due

—

filed $600,000

27

Jan.

1,

1966;

lpans; and for working capital.

Office

—

Ithaca, N. Y.

Underwriter—None.
(i

Underwriter—None.
•

Underwriters—The First Boston
York.

Cooperative Association

Consumers
Oct. 23 filed

Sept. 3 filed $1,000,000 of 8% mortgage bond trust cer¬
tificates.
Price — At par (in units of $250, $500 and

Mokafe

1977.

filed

Underwriter—The

Caramba

1,

short-term debt, to construct

bank loans and for construction program. Under¬
writer—BIyth & Co., Inc., San Francisco and New York.

•

/

senior notes due Nov.

$20,000,000 of convertible junior subordin¬
due 1972. Price — To be supplied by
amendment. Proceeds—To liquidate deferred credits and
1

ated

Price—To be supplied

effective Nov.

'

Commonwealth

Nov.

repay

Statement

York. Statement

New

Offering—Indefinitely postponed.

provide

—

Sanford, Me.

Co., Inc.,

working capital.

Oct. 30 filed 250,000 shares of common stock (par

by amendment.

-

and Kidder, Peabody & Co., both of New

Corp.

porarily postponed.

Proceeds

&

filed $50,000,000

10

crease

Corp.; Blair & Co. Incorporated. Bids — Had been ex¬
pected to be received up to 11 a.m. (EST) on Oct. 30 at
49 Federal St., Boston, Mass., but offering has been tem¬

California Water & Telephone Co.

ISSUE

Price—To be supplied by amendment. Proceeds—To in¬

securities of Montaup Electric Co. Underwriter
—To be determined by competitive bidding.. Probable
bidders: Halsey, Stuart & Co. Inc.; White, Weld & Co.
and Shields & Co. (jointly); Stone & Webster Securities

Daybreak Uranium, Inc., Opportunity, Wash.

filed 631,925 shares of common stock (par 10
Price — At market (approximately 53 cents per
share). Proceeds—To selling stockholders. Underwriter
Herrin Co., Seattle, Wash.

Caruso

May

7
cents).

Foods, Inc. (11/25)
Oct. 3 (letter of notification) 150,000 shares of common
stock (par one cent).
Price—$2 per share. Proceeds—
For working capital, etc. Business—Spaghetti, macaroni,
etc. products. Office—2891-99 Nostrand Ave., Brooklyn,
N. Y.
Underwriter
Anglo-American Securities, Inc.,

DeLuxe

Check Printers,

Inc.

—

New

York.

Aug. 28 (letter of notification) 25,000 shares of common
stock (par $1) to be offered to employees and present
stockholders. Price—$11.80 per share. Proceeds—To ac¬

i

Central Mortgage & Investment Corp. Sept. 12 filed $5,000,000 of 20-year mortgage bonds and
500,000 shares of common stock (par five cents) to be

quire

business.

Office—Miami

Beach, Fla.
writer—Aetna Securities Corp., New York.

of

Under¬

which

& Sons Stores Co., Inc.

110,000 shares of common stock

100,000 shares are to

(par $5),

be offered publicly and

shares to employees, officers and directors of
Price—To be supplied by amendment. Pro¬
reduce bank loans, to equip new stores, to
increase
inventories
and for
general corporate pur¬
10,000

company.

ceeds—To

May 14 (letter of notification) 600,000 shares of common
(par $1—Canadian). Price—50 cents per share
(U. S. funds). Proceeds—For exploration costs, etc. Of¬

stock

Underwriter—Kidder, Peabody & Co., New York.

poses.

Disc, Inc., Washington, D. C.
400,000 shares of class A common stock (par
$1). Price—$2.50 per share. Proceeds—For investment.
Business—Purchase and development of real property,
and acquisition of stock of business enterprises. Under¬
writer—None.
Irving Lichtman is President and Board

fice—5616 Park

Ave., Montreal, Canada. Underwriter—
Jean R. Veditz
Co., Inc., 160 Broadway, New York.
Offering—Expected at any time.

Oct. 10 filed

Chicago Title & Trust Co.
24

12 filed

Nov.

Chess Uranium Corp.

Oct.

(J. S.)

it Dillon

Price—$100.50 per unit. Proceeds—For purchase of first
mortgages or to make first mortgage loans and for con¬
struction

machinery and equipment. Office — 530 N.
St., St. Paul 4, Minn. Underwriter—None.

new

Wheeler

offered in units of $100 of bonds and 10 shares of stock.

filed

23,907 shares of common stock (par $20)
exchange for common stock of Title In¬
Corp. of St. Louis at the rate of five-eighths of
one share of Chicago Title stock for each Title Insurance
share.
The exchange offer is subject to acceptance by
30,600 shares (80%) of the 38,250 Title Insurance shares
outstanding. Initial expiration date of the offer is Dec.
to be offered in

Chairman.

surance

20.

Sept. 26, 1957
five

shares

Okla.
•

Doctors' Motels,

Oct.

on

held.

the basis

First

and

to

of

Price—$20

payable;

5,600

stockholders

one

per

drilling

National

shares of
new

share.

for

oil

record

wells.

be

privatelv placed; and warrants
to purchase an undetermined number of shares of Mc¬
Lean

Industries, Inc., class A common stock at market,
the exact number of shares to be established at a later

date.

Price—To

be

supplied by amendment (expected
at 100% for debentures).
Proceeds—Together with other
funds, to purchase five C-2 freighters to be converted
into trailerships.
Underwriters—Eastman Dillon, Union
Securities &
York.

Co. and

White, Weld & Co.,1 both of New

per

share).

Price
Proceeds—For construction
Un¬

Chemical
filed

Co.

200,000

shares of common

stock

(par S5)

4

through Nov. 22. Price—$42.25 per share. Pro¬
general corporate purposes. Underwriter—

ceeds—For

1968

to

3

Nov.

Sept.

shares

($15

being offered for subscription by employees of the com¬
pany, its subsidiaries and certain associated companies.
Subscriptions will be accepted by the comoany from

Underwriter—Ncne.

20.000

30,850 shares are presently outstanding.

par

operation of motels and to repay bank loans.

Dow

Coastal Ship Corp.

and

dend and

Oct.

Building, Oklahoma City 2,

(11/18-22)
13 filed $6,000,000 of 6% debentures due Feb. 1,
(with warrants to purchase 80,000 shares of common
stock of Coastal, of which 60,000 shares are included in
the public offering and exercisable at
$1 per share;

shares of common stock, of which

derwriter—None.

Proceeds—For
gas

Inc., Kansas City. Kan.

—At

and

share for each

and

filed 500,000

debentures, 3,085 shares are to be issued as a stock divi¬

common

of

25

426,497 shares are to be offered publicly, 39,568 shares
are to be offered in exchange for $432,055 outstanding 6%

Underwriter—None.

Cleary (W. B.), Inc.
Oct. 3 (letter of notification)
stock (par $5)„ to be offered

Office—272

Savings deposits in Chicago and Mid America

Oct.

and

to acquire

$1,000).

REVISED

Commercial Credit Co.

and collateral

filed $3,000,000 first mortgage

18

ITEMS

effective Aug. 10.

Edison Co.

Brockton

accounts

$7 Billion Savings!

banking

the sale to a

negotiate

to

PREVIOUS

July 5 filed 248,132 shares of common stock (par 10C)".
Price—At market.
Proceeds—To selling stockholders;

group.

and

class A common stock; rights to expire
Price—$30 per share to stockholders; and
$32 to public. Proceeds—To purchase assets of Collins
Park Water Co.; Willow Run Water Co. and Sedgely
Farms Water Plant; also to purchase additional storage
tanks, water mains, etc. Office — 501 Newport & Gas
Pike, Newport, Del.
Underwriter — Laird, Bissell &
Meeds, Wilmington, Del.

seek

to

Company

•

SINCE

Colonial Aircraft Corp.,

expected to be received up to 11 a.m. (EDT) on Oct. 23
St., Boston, Mass., but none were received.

at 49 Federal

Sept.

New York

Allstate Commercial Corp.,

Sept. 16 filed 256,300 shares of class A common

Registration

^

,

None.
^ Dura'oy Co., Scottdale, Pa.
12 filed 69,000 shares of common stock (par 81).
Price—To be supplied by amendment.
Proceeds—For
modernization and improvements.
Underwriter—Mor¬

Nov.

timer B. Burnside &
Durox of

Co., Inc.,. New York.

Minnesota, Inc., Denver, Cole.

Sept. 23 filed 750,000 shares of common stock (par $1).
Price—$2 per share. Proceeds—For capital expenditures
and

working

capital.

Underwriter—American
Colo.

Business — Buildihg material
Underwriters, Inc., Englewood,

Volume 18S

Number 5690

The Commercial and Financial Chronicle

..

(2139)
1

Precision Corp.,

Electro

Oct. 30

Arkadelphia, Ark.

(letter of notification) 60,000 shares of

General Automatics Corp., Atlanta, Ga.
May 23 (letter of notification) 100,000 shares of common
stock (par $1).
Price—$2 per share. Proceeds—To es¬
tablish production facilities for manufacture and assem¬
bly of controls; and for other corporate purposes. Ad¬

common

stock (par $1). Price—$4 per share. Proceeds—For office
and

laboratory equipment;

etc.

Underwriter—Nunn-Groves

inventory, working capital,
Co., Little Rock, Ark.

it Famous Virginia Foods Corp.
?
'
Nov. 6 (letter of notification) 5,000 shares
Price—$6.67

stock.

share:

of

dress—c/o Positronic Corp., 2572 Ridgemore Road, N. W.,
Atlanta, Ga. Underwriters—Armstrong & Co., Atlanta,

common

Ga.

Proceeds—To

selling
St., Lynchburg, Va.
Underwriter—Whitney & Co., Inc., Washington, D. C.
stockholder.-

Fine Arts

•

per

Jefferson

Office—922

Acceptance Corp.

.

(11/25-27)

corporate purposes. Underwriters—Woodcock, Hess,
Moyer & Co., Inc.; Boenning & Co.; Suplee, Yeatman,

Aug. 26 (letter of notification)*1100,000 shares of

C

common

Proceeds — For
capital and surplus and for first year's deficit. Office^—
3395 S. Bannock St., Englewood, Colo... Underwriter —
American Underwriters, Inc., Englewood, Colo;/^/.
First National Life Insurance Co.,

Phoenix, Ariz.
Stock (par $4),
of which 90,000 shares are to be offered publicly and
;16,500 shares to employees pursuant to stock purchase
-options. Price—To public; $12 per share. Proceeds—For
expansion and other, corporate purposes* Underwriter—
.

common

?

None.......
•

;v

.!

•

:

■;

- yr-'.-r.

„

Florida Power & Light Co;

.

( 11/20)

300,000 additional shares of common stock
Price—To be supplied by amendment; Pro¬
ceeds—For construction program. Underwriters—Merrill
'Lynch, Pierce, Fenner & Beane and Kidder, Peabody &
•Co., both of New York.
'
s
(no par).

it Florida Steel Corp., Tampa, Fla. .(12/2)
Nov.

.of

filed

12

offered

be

80,000 shares of
for

Nov.

record

subscription

common

stock

(par $1)

by common stockholders

1957, at the, rate of one new share
held; rignts to expire on Dec. 16.
Price—To be supplied oy amendment. ,: Proceeds — To¬
gether with bank loans, to construct new steel mill.
Underwriters—McDonald & Co., Cleveland, Ohio, and
for

each

29,

shares

10

Proceeds—

stock

notes and for drilling and working capital. Office—207
Newhouse Bldg., Salt Lake City, Utah.
Underwriter—

Birkenmayer & Co., Denver, Colo.
Great

Parking, Inc.
June 18 (letter of notification). 240,000 shares erf common
stock (par $1). Price—$1.25 per share. Proceeds—To re¬
tire outstanding debt; for expansion of subsidiary cor¬
poration and for working capital. Office—c/o Edwin
F„ Clements, 5312 Glenwood Ave., Youngstown, Ohio.
Underwriter—L. L. LaFortune & Co., Las Vegas, Nev.
General
;

Telephone

Co.

of

the

Southwest

(11/21).

--

Northern Life

chum, Jones & Templeton, Los Angeles, Calif.
Genie Craft Corp.

(letter of notification) 44,400 shares of common
(par $1). Price—$6.75 per share. Proceeds—For
capital stock and unassigned surplus. Office — 119 W.
Rudisill Blvd., Fort Wayne, Ind. Underwriter—North¬
western

Investment Inc., Fort Wayne, 'Ind.

Guardian Insurance Corp., Baltimore, Md.

Aug. 16 filed 300,000 shares of common stock, of which
200,000 shares are to be publicly offered and the remain¬
ing 100,000 shares reserved for issuance upon exercise

S"

debenture and 20

shares of common stock. Price—$100
unit. Proceeds—To discharge short term obligations;
purchase merchandise inventory; and for working cap¬
ital. Office
1022 18st St., N. W., Washington, D. C.
Underwriter—Whitney & Co., Inc., Washington, D. C.
per

—

Giant Petroleum

to

to be sold at 25 cents per warrant

are

organizers, incorporators, management, and/or direc¬

tors.

PHce—$10

share.

per

Proceeds—For working cap¬

ital and general corporate purposes.
Gulf States Land &

(letter of notification) $100,000 of 10-year 6%
convertible debentures and 120,000 shares of common
stock (par 10 cents) to be offered in units of one $50

Insurance Co.

7

stock

of warrants which

Nov. 1 filed 250,000 shares of cumulative preferred stock.
Price—At pax ($20 per share). Proceeds—To repay bank
loans and for. new construction. Dealer-Manager—Mit-

Aug. 8

Oct. 24 filed

'to

unit.

Divide Oil Corp.
(letter of notification) 300,000 shares of common
(par 10 cents). Price—$1 per share. Proceeds—
To pay balance on oil and gas
properties, and unsecured

Oct. 11

Oct.

(par $T) .K Price$3 per sharei;

ijiily 29 filed 106,500 shares of

per

General

J;* First International Fire Insurance Co.
stock

stock of Kulk^i Electric
Manufacturing Co., Inc. Office
—Elizabeth, N. J. Underwriter—Amos Treat & Co., Inc.,

Application is still pending with SEC.

Mosley & Co., Inc., and Paul &.iLynch, all of Philadel¬

:

Price—$500

For expansion and working capital. Underwriter—None
named.
Offering to be made through selected dealers

eral

.

25

Great

warrants to purchase 160,000
shares of participating
preference stock, to be offered in units of $500 of deben¬
tures and 40 warrants.

chase warrants), due Nov.T, 1977. Price—95% of prin¬
cipal amount Proceeds—For working capital and gen¬

phia, Pa. :

Credit, Inc., Washington, D. C.

Aug. 17, 1956 filed $2,000,000 of 6% subordinated sink¬
ing fund debentures, due Sept. 1, 1971, with detachable

-

»

r

Seal

Dairy Products Corp. (11/25)
filed 175,000 shares of class A stock (par 10
cents)
of
which
15,000 shares are to
be
reserved
for
prior offer to employees.
Price — To
be
sup¬
plied by amendment. Proceeds—To acquire outstanding
Oct.

New York.

General

:Och 25 filed. $525,000 of 6V2% subordinated sinking fund
debentures. (with nop-detachable common " stock pur¬

Gold

39

Underwriter—None.

Industries, Inc.

Sept. 25 filed 316,814 shares of common stock (par 50
cents) and $2,754,900 6% first mortgage sinking fund
bonds due 1972 to be offered in exchange for the out¬
standing $4.50 prior preferred stock on the following
basis: For each preferred share (a) 11% shares of com¬

stock,

mon

(b)

or

$100

of

bonds,

plus

1%

shares

of

stock.

The offer is conditioned upon its acceptance by
holders of at least 85% of the 27,549 outstanding pre¬
ferred shares.
Exchange Agent — Howard, Weil, La-

bouisse, Friedrichs & Co., New Orleans, La.

Corp.

July 22 (letter of notification) 150,000 shares of common
stock (par 10 cents). Price—$2 per share. Proceeds—To

outstanding debt and for working capital. Office—
225 East 46th St., New York, N. Y. Underwriter—A. G.
Bellin Securities Corp., 52 Broadway, New York. N Y.
Offering—Temporarily suspended by SEC on Oct. 18.
pay

Hampshire Nickel Mines Ltd.
Aug. 23 (letter of notification) 600,000 shares of common
stock (par $1-Canadian).
Price — 50 cents p<*r share.
Proceeds—For development of property and for general

Continued

on

page

40

'Kidder, Peabody & Co., New York, N. Y.
-

Florida

March
the

Trust, Pompano Beach, Fla.

filed

4

850

certificates

beneficial

of

interest

in

Price—$1,000 per certificate. Proceeds—To
.acquire by purchase, lease or otherwise, and to hold,
.own, subdivide, lease, mortgage, exchange, bargain, sell
and convey lands and every character of real property
.

45

Underwriter—None.

\

».

it Fluorspar Corp. of America
Nov.

\

ceeds—To

finance additional

exploration work

ing properties and to provide working capital.

on

it Food

(Kidder,

Idaho Power

*

to be offered for subscription by common stockon ' the
basis of one new share for each two

holders

be

supplied

Pierce,

Fenner

by

date of
amendment. Pro¬

ceeds—To repay

bank loans and for real estate operations
financing.
Underwriter — Eastman Dillon, Union
& Co.; .New York.
Food Fair Stores, Inc.,
-owner of about 45%
of the outstanding common stock,
-has indicated that it intends to exercise its subscription

Olin Mathieson Chemical Corp
—Debentures
(Dillon, Read & Co. Inc. and Eastman Dillon, Union
Securities & Co.) $60,000,000

&

November 21

Co
EST)

November
Oil

15

Fuller

Co.)

&

Read

Co

Caruso

Foods,

$1,125,000

$20,000,000

Inc. and The First Boston Corp.

:

200,000 shs.

it Food Fair Stores,

Yeatman,

Debentures

filed 200,000 shares of

12

common

stock (par $1)

Stock

Option Plan.

Underwriter—None.

Forest Laboratories,

motion

Powell

.Bonds

(Bids

a.m.

11

EST)

$40,000,000

and

1,537,500 shares of

ceeds—To

common

B stock

(no par)
(par $1). Pro¬

the

Attorney General of the United States.
Underwriter—To be determined by competitive bidding

1—Debentures

Co., Inc

(Stroud

&

Inc.)

Co.

.Bids

Securities Corp.)

735,000

Hawaii

shares

10

Bonds
EST)

a.m.

(Bids noon

Common
451,894 shares

EST)

EST)

a.m

'Bids

Commonwealth

t25.000.000

Pall

Corp.

(The

Common

-

(Schuster &

Inc.)

Co.,

$100,000

California Water & Telephone Co
Florida

scheduled to be received up
13 at Room 654.

101

(jointly). Bids — Had been
to 3:45 p.m. (EDT) on May

Indiana Ave., N.

W., Washington 25,
D. C., but bidding has been postponed.




Common

Power & Light Co

11

Service

(Robert

Lieberknecht

W.

30

a m

-.Bond*

$40,000,000

Co
Baird

11

(Monday)

$30,000,000

EST)

a.m.

Boston

11

Corp )

'Bids

January

<

Wednesday)

Bondi

Co
a.m.

$4,500,000

EST)

(Tuesday)

1958

14,
to be

Bonds Debentures

22,

invited) $50,000,000

1958

(Wednesday)
Equip. Trust Ctfs.

Norfolk & Western Ry
'Bids

Debentures

$20,000,000

nooD

EST)

$4.140 000

Common
&

Co.,

Inc.)

100,000

shares

(Karl), Inc

(Bids

9

Refining Co

11

January

Common

EST)

$7,000,000

Commonwealth Edison Co.

(Merrill Lynch, Pierce, Fenner & Beane and Kidder,
Peabody & Co. > 300,000 shares

'Bids

First

(Bids

250,000 shares

Bonds

Corp

EST)

a.m.

11:30

Oil

Electric

(Wednesday)

(Blyth & Co., Inc.)

10

December

Suburban
November 20

(Thursday)

Chesapeake & Potomac Telephone Co. of
Maryland
..--Debentures

Bonds
11

$4,140,000

F»»uip. Trust Ctfs.

December

$7,000,000

Co
'Bids

Equip. Trust Ctfs.

Service

(Bids

Middle South Utilities Inc

Ohio Power

(Wednesday)

EST)

nooD

(Bids noon EST) $3,435,000

.

(Tuesday)

(Territory of)
(Bids

—Bonds

$20,000,000

Baltimore & Ohio RR

Wisconsin Public

19

Johnson

Co.

EST)

a.m.

December 5

Common

^

and

&

11

Norfolk & Western Ry

150,000 shares

United States Coconut Fiber Corp
(Southeastern

(Tuesday)

Class B Common

Co., Inc

Houston Lighting & Power Co.-. —!

Forgan

3

December

(Bids

Ritter Finance

(Monday)

$3,500,000

Probable bidders: Blyth & Co., Inc., and The First Bos¬
ton Corn (jointly); Kuhn, Loeb & Co., Lehman Brothers

Glore,

2

December

—

Jan. 14 filed 436,988 shares of common A stock

—Common

Virginia Electric & Power Co

(Stroud & Co., Inc.) $900,000

—

New York

shares

(Tuesday)

Co., Inc

—Bonds
EST)

a.m.

November

General Aniline & Film Corp.,

175.000

Kidder, Peabody & Co.) 80,000 shares

Colo.

City Steel, Inc., Omaha, Neb.
Oct. 17 filed 30,000 shares of 6 %% cumulative sinking
fund preferred stock, series A (par $20), with common
stock purchase warrants to buy 60,000 shares of common
stock; and 100,000 shares of common stock (par $1).
Price
At par for preferred and $5.50 per share for
common.
Proceeds
To retire outstanding preferred
stocks and short-term bank loans and for general cor¬
porate purposes. Underwriter—The First Trust Co. of
Lincoln, Neb. Offering—Expected this week.

Inc.)

26

December 4
Ritter Finance

Co., New York; and H. Carroll & Co., Denver,

Gate

Class A Common

Corp

Co.,

&

Florida Steel Corp.'
Common
(Offering to stockholders—underwritten by McDonald & co. and

Debentures

Michigan Bell Telephone Co—

of

company's products, working capital, addi¬
tional inventory and accounts receivable, for research
and development and for other general corporate pur¬
poses. Office—Brooklyn, N. Y.
Underwriters—Alfred L.

&

(Bids 10:45 a.m. EST) $2,000,000

Mystic Valley Gas Co

Inc.

& Co.; Suplee,
$525,000

(Hemphill, Noyes & Co.) 210,000 shares

Common
400,000 shares

Co

Lawrence Gas

(Bids 11:30

Aug. 28 filed 200,000 shares of capital stock (par 10
cents). Price—$2.50 per share. Proceeds—For sales pro¬

Ketchum

Boenning

.Debentures

$6,000,000

(Dempsey-Tegeler & Co.)

to be offered to key employees of the company and its
subsidiaries under the company's Employees' Restricted

Treat

November

Ship Corp

_

Mosley & Co., Inc.; and Paul & Lynch)

(Monday)

Hycon Manufacturing Co

Inc.

Common

Gold Seal Dairy Products

(Eastman Dillon, Union Securities & Co. and White, Weld & Co.)

Offering—Expected early in December.

rights.

Nov.

Coastal

(Monday)

Inc

Fine Arts Acceptance Corp
(Woodcock, Hess, Moyer & Co., Inc.;

(Amos

18

November

200,000 shares

inc.)

(Anglo-American Securities, Inc.) $300,000

Preferred

and

Securities

Co.,

November 25

Gas, Electric Light & Power Co.—Common

(Blyth & Co.,

& Co.i

Common

(Blyth &

$90,000

Inc.)

Debentures
by Kuhn, Loeb

Ryder System, Inc

(Friday)

Common

&

Templeton) $5,000,000

&

to stockholders—underwritten

Common

D.

Jones

(Thursday)
the Southwest Preferred

$7,675,300

Texas Eastern Transmission Corp
(Dillon,

Royal McBee Corp

(Mitchum,

(Hal) Productions

Tucson

Bonds

(Offering

Co

(S

General Telephone Co. of

$6,000,000

(Wayne Jewell Co.)

Roach

Bonds
515,000,000

(Bids 11 a.m. EST)

shares held; rights to expire in two weeks from

Price—To

and Merrill Lynch,
225,000 shares

A? Co.

(Bids noon

Illowata

Fair Properties, Inc.
2,499,116 shares of common stock (par one

offering.

Common

Savannah Electric & Power Co

Office—

12 filed

cent)

(Thursday)

CALENDAR

Beane;

'

-

14

Co

Peabody

min-

Portland, Ore.

-Nov.

November

,

Idaho Power

ISSUE

<

12 filed

$1,400,000 aggregate market value of com¬
mon stock
(number of shares to be supplied by amend¬
ment). Price—Also to be supplied by amendment. Pro¬
:

NEW

Trust.

a.m.

EST)

158,025 shares

(Thursday)

February 13, 1958

,

Common

Indiana

&

Michigan
•

Electric

(Bids 11 a.m. EST)

Co...

$25,000,000

Bonds

•

40

The Commercial and Financial Chronicle

(2140)

Thursday, November 14, 1957

...

'

,

Continued from page

Suite 607, 320 Bay St*,
— H. J. Cooney
& Co.,

and

Electric

Light Co.
Oct. 8 filed S2.400.000 of 3% secured debentures, series
A. due Aug.

i'irst

1967. being offered

1,

one

in_ exchange for 3 %

•

Johnson

Nov.

—None.

Life

Insurance Co.

stock to be

public at $5 per share and 116,366 shares
common stock to be offered to stockholders

B

•

Horace

June

Underwriter—None.

Lauderdale, Fla.

III.

Fund, Inc., Springfield,

Mann

100,000 shares of capital stock (par $1).
Proceeds—For investment. Distrib¬

filed

27

market.

Price—At

Manager—Horace Mann Investors,

utor and Investment

Inc., Des Moines, la., of which Charles F. Martin is also
Office—216 E. Monroe St., Springfield, 111.

•

^President.

Houston

bonds due 1987.

bank loans and for new construc¬
Underwriter—To be determined by competitive

tion.

bidding.
Eoui table

(11/20)

stock

common

—

—

be

&

Indefinitely postponed.

Lawrence

18

Co.

Gas

repay

Probable bidders: Halsey, Stuart & Co., Inc.;
Securities Corp.: Lehman Brothers; Eastman

be

cent).
tion

Dillon, Union Securities & Co., and Salomon Bros. &

10:45

a.m.

at

(EST)

(jointly); Lazard Freres & Co. and Blyth & Co.,
(jointly); Kidder, Peabody & Co. Bids-—To be re¬
Nov. 20 at Two Rector

A'"?

up

Underwriter—Hay den, Stone & Co., New York. Offer¬
ing—Temporarily postponed because of market condi¬
tions.

Oglethorpe Life Insurance Co., Savannah, Ga.
13 (letter of notification) 26,932 shares of com¬
stock (par $2.50), of which
17,932 shares are be¬

to

Sept.

18.

it Louisiana Pure Milk Producers Association, Inc.
4 (letter of notification) 5,000 shares of class A

ing offered to present stockholders and 9,000 shares are
employees. Price — $11 per share.. Proceeds —To increase capital and surplus. Underwriters—John¬
son, Lane, Space Corp. and Varnedoe, Chisholm &
Co.,both of Savannah, Ga.

common

stock

to

be

sold

affiliates

to

other

or

offered to

milk

producers corporate associations. Price—At par ($3 per
share). Proceeds — For working capital. Office — 628
Florida St., Baton Rouge, La. Underwriter—None.

Co., Hutchinson, Minn.

(letter of notification) 1,697 shares of common
be offered for subscription by common stock¬
holders on the basis of one new share for each five

Aug. 21

as

of Aug. 20, 1957.

Price—At

Ohio Power Co; (11/19)
Sept. 30 filed $25,000,000 first mortgage bonds due 1987.
Proceeds—To repay bank loans and for construction
pro--

Mascot

Mines, Inc., Kellogg, Idaho
June 3 (letter of notification) 800,000 shares of common
stock.
Price—At par (17V2 cents per share). Proceeds
—For mining expenses.
Office—Sidney Bldg., Kellogg,
Idaho, Malcolm C. Brown is President. UnderwriterStandard Securities Corp., Spokane, Wash., and Kellogg,

($10 per

par

Underwriter

Proceeds—For expansion of plant.

—None.
•

(11/18-22)

Hycon Mfg. Co., Pasadena, Calif.

Oct.

18

filed

shares

400,000

of

common

stock

(par

10

Price—To be supplied by amendment. Proceeds
bank loan, for capital improvements, re¬
search and development costs and working capital. Un«flerwriter—Dempsey-Tegeler & Co., St. Louis, Mo.
•

repay

Idaho

Oct.

16

1987.

Power Co.

filed

(11 14)

$15,000,000

Proceeds

—

of

first

mortgage

To reduce bank loans.

bonds

due

Underwriter—

Eastman, Dillon, Union Securities & Co. (jointly);
& Co. Inc., Lazard Freres & Co. and The First
Boston Corp.
(jointly); Kidder, Peabody & Co. and
White, Weld & Co. (jointly); Equitable Securities Corp.
Bids—Expected to be received up to noon (EST) on
-

Idaho Power Co.

:

•

(11/14-)

Oct. 16 filed 225,000 shares of

"

•

Merrill Lynch.

Illowata

Oil

Co.

V

International

•

\

Staple & Machine Co.

Oct. 14 (letter of

notification) 20,000 shares of 6% cumu¬
lative preferred stock of which 10,000 shares are
to be
offered to the public and the remainder to
common

Oct.

—For

exchange for

for each share of preferred.

and tenders for

Nov. mi,

10, 1957 in

seven

Both

exchange must be rec^ved

sha^-eS of

subscription
on

or

before

195J. Lnee—AT

Working capital.

ing, Pittsburgh 19; Pa,

par ($T0'per share). Proceeds
Office—497 Union Trust Build¬

Underwriter—None.

ln«rS State Telephone Co.
Sent. 27 filed 4.900 shares of common

being offered

lor subscription by common stockholders on the basis
"Of one new share for each two shares held of record Oct.

18, 1957; rights to expire on Dec. 16, 1957, Price—At par
($100 per share). Proceeds—To reduce bank loans. Of¬
fice—Galesburg, 111. Underwriter—None. Statement ef¬
fective Oct. 23.

Israel-Mediterranean Petroleum, Inc. of Panama
6ept. 27 filed voting trustees covering 1,000,000 shares of
common stock (par one cent).
Price—At the market on
the American Stock Exchange. ^Proceeds—For explora¬

•

Old American Life Co.,
Seattle/ Wash.
•July 22 filed 15,825 shares of class A stock, (par $10) and
3,165 shares of common stock (par $10i>. to be offered in
units

Utilities

Co.

subscription by

rate of

new

one

(with

•

stockholders at the

common

share for each 12 shares held

:

of Oct.

as

an

Underwriter—Edward D. Jones

&

^

.

class

A

shares.

For'working capital

Underwriter—None,

Corp.

(11/20)

i

Co., St. Louis, Mo.

by

16

$3,500,000

.PalfiiivrtfF Economic Corp., New York^
Sept. 26 filed 130,000 shares of common stock.
-

At par

(11/18)

first

mortgage bonds, series B, due
Proceeds—To repay bank loans and for construc¬
tion program. Underwriter—To be determined
by com¬
petitive bidding.
Probable bidders: Halsey, Stuart &
Co. Inc.:

investment in stock of two companies; and for
working
and other corporate purposes.
Underwriter—^
Nflne.
-

capital

•

r

• Pall

11

a.m.

(EST)

on

Nov. 18 at

St., Boston 16, Mass.

Nassau Fund, Princeton, N. J.
May 8 filed 250,000 shares of common stock. Price—At
market.

Proceeds—For

St., Princeton, N. J.

Hoisington, Inc.,

investment.

Office—10

Investment Advisor

same

address.

.

—

,

Nassau

Harland
.

.

•

W.
.

Corp.

(Formerly Micro

Metallic

Corp.)

*

11

19-21)
}
(letter of notification) 20,000 shares of common
(par $1). Price—$5 per share.- Proceeds—For in¬

Nov.

1

ventories.

working capital, etc.

Business

—

Filtration

equipment.
N.' Y.

Office—30 Sea Cliff Ave., Glen Cove, L.
I.,.
Underwriter—Schuster & Co., Inc., New York.

Pan American Tool

441 Stuart

to

Price—

($25

per share).
Proceeds—For participation in
further-development of Israel industry; for capital im¬
provements; for extension of cooperative and other
banking credit; for financing of export to Israel; for

stock

1977.

up

Pacific.'
Underwriter—None.

'

•

(N. Y.)
May 9 filed 5,000 units of undivided interests in Munic¬
ipal Investment Trust Fund, Series A. Price—At market
Proceeds—For investment. Sponsor—Ira Haupt & Co..
New York.

stock

^Merrill, which options will be assumed by

Office—Calgary, Alberta, Canada.

is President.

Mystic Valley Gas Co.

Pacific Petroleums, Ltd. " ;
' :
Oct. 11 filed 1,603,998 shares of common stock
(par $1),
of which 1,588,998 shares are to be offered inexchange

shares; the, remaining 15,000 shares are to be issuable
exercise of presently outstanding options granted

•

Municipal Investment Trust Fund, Inc.

debentures,

D, due 1987 (guaranteed unconditionally as to
principal and interest by the Province of British Columbia). Price—To be supplied by amendment Proceeds^—

upon

Aug. 19 filed $1,000,000 of participation" llnits in second
mortgages of real estate to be offered for public sale in
units of $100, plus tTSales commission of
$10 per unit
tQ
CCTnpany. Proceeds—To be invested in small loans
"Secured by second mortgage on home
properties. Office
—Springfield. Mass. Underwriter—None. Charles Hersh-

Oct.

Ry,
sinking fund

of

Merrill

'

Mortgage Clubs of America,, Inc.

$30,000,000

for outstanding Merrill
Petroleums, Ltd. common
at the rate of one Pacific share for each two

processing and selling of gravel. Office—203 Broad way r
Monticello, N. Y. Underwriter—Walnut Securities Corp..
•• •

filed

,

:

expenditures, including construction of motel,,
roadside restaurant and gas station. Business—Has been

•

-

bank loans. Underwriters—Morgan* Stanley &
Co., Harris & Partners, Inc. and Burns Bros.. & Denton,
Inc., all of New York. Offering—Indefinitely postponed.

capital

•

25

writer—None.



three

—

series

•—To

Miami. Fla.
(letter of notification) 300,000 shares of com¬
Price—$1 per share. Proceeds
—To purchase a ship and for working capital. Under¬

writer—Anderson Cook Co., Inc„ Palm,Beach, Fla...

and

To repay

'■Moirticello Associates, Inc.
Feb. 18 (letter of notification)
300,000 shares of common
•tock.
Price—At par ($1 per share). Proceeds — For

Philadelphia, Pa.

Pacific Great Eastern

Oct.

Bids—To be received

stock (par 10 cents).

share

Proceeds

supplied by

tory drilling and development of presently licensed acre¬
age and for acquisition of additional acreage. Under¬
Isthmus Steamship & Salvage Co.,

unit.

Proceeds—For expansion and working
cap¬
Underwriters—Dillon, Read & Co. Inc. and Eastman
Dillon, Union Securities & Co., both of New York.
v,

Oct.

Jftay 21

common

per

ital.

White, Weld & Co., and Kidder, Peabody & Co.
(jointly); The First Boston Corp.: Lehman Brothers.

mon

one

Olm Mathieson Chemical

oversubscription privilege); rights to expire
on Nov. 25.
Price—$19.50 per share. Proceeds—Together
with funds from private sale of $800,000
5%% first
mortgage bonds, series C, to be used to retire bank loans
and
pay
for -property additions
and
improvements.
{

of

Price—$260

and other corporate purposes.

up to noon (EST) on Nov. 19 at
2033, Two Rector St., New York, N. Y.

offered for

man

stock

stocks of

amendment.

stockholders

of record

(par $10).

Room

15

Inland Western Loan & Finance

tracts issued by Commercial Life Insurance Co. Price—
50 per share. Proceeds—For
operating capital for two
subsidiaries and to finance expansion program. Office—

stock

common

:
Oet. 31 filed $60,000,000 of convertible subordinated
de¬
bentures due Nov. 15, 1982. Price — To be

Missouri

Corp.
Aug. 16 filed 2.500,000 shares of class A non-voting com¬
mon stock
(par $1) to be offered for subscription by
holders of special participation life or
endowment con-

exploration,
etc. of oil properties.
Underwriter— Mineral Projects v
Co., Ltd., Madison, N. J.
"

(11/19)

common

-

Madison, N;.J,

Oct. 7 filed 25,135 shares of common stock
(par $1) being

writer—Wayne Jewell Co., Denver, Colo.

Underwriter—None.

451,894 shares of

Ventures—First 1958 Fund* Ltd; and
Ventures—Second 1958 Fund, Ltd.,

Gas

Bids—To be received

Pierce, Fenner & Beane.

ceeds—For exploration and operation of oil properties.
Office—1509 Mile High Center, Denver,- Colo. Under¬

by competitive

Halsey, Stuart: & Co." Inc.;
Corp.; Blyth & Co., Inc.;: Eastman,

Oct. 29 filed $2,500,000 of participations in
capital as lim¬
ited partnership interests to be offered in
$25,000 minimum
amounts.
Proceeds—For acquisition,

curities & Co. and

(11/15)

determined

Nov. 19 at 30 Church St., New York 8, N. Y.*

& Gas

Oil &

(jointly); Lehman Brothers; Eastman Dillon, Union Se¬
Equitable Securities Corp. (jointly).

stock

Oct. 24 (letter of notification) 900,000 shares of common
stock (par one cent). Price—10 cents per share. Pro¬

Phoenix, Ariz.

filed

Utilities, Inc.

on

Oil

operating companies; to repay bank loans and
for other corporate purposes.
Underwriter—To be de¬
termined
by competitive bidding. Probable bidders:
Blyth & Co., Inc.; The First Boston Corp.; Kidder, Pea¬
body & Co. and Merrill Lynch, Pierce, Fenner & Beane

(par $10).
Price—To be supplied by amendment. Proceeds—To re¬
duce bank loans. Underwriters—Kidder, Peabody & Co.
«nd

(EST)

system

*:

common

9

Boston

be

bidders:

•Dillon, Union Securities & Co. and Salomon Bros. &
(jointly). Bids—To be received up to M a.m.

up to 11:30 a.m. (EST) 011
Broadway, New York, N. Y.

Proceeds—For further investments in

Blvth

'•

be received

Middle South

«nd

14.

Bids—To

Nov. 18 at Room 2315, 195

Oct.

Probable

First

-Hutzler

Michigan Bell Telephone Co. (11/18)
Oct, 25 filed $40,000,000 of debentures due Nov. 1, 1992.
Proceeds—To repay advances from parent. Underwriter
—To be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co. Inc.; Morgan, Stanley &
Co.

To be determined by competitive bidding. Probable bid¬
ders: Halsey, Stuart & Co. Inc.: Salomon Bros. & Hutzler

Nov.

bidding.
The

,

-

Underwriter—To

gram.

Idaho.

cents).
—To

Engineering Corp.

Sept. 20 filed 100,000 shares of common stock (par 25
Price—To be supplied by amendment. Proceeds
—To prepay indebtedness to
Norden-Ketay Coip., to
purchase additional equipment and for working capital.

•tock to

•hare).

be amended.

to

Nuclear Science &

Nov.

St., New York 6, N. Y.

•hares held

ore

mon

ceived up to 11:30 a.m. (EST) on

Hutchinson Telephone

one

acquisi-r
testing program; for assess¬

a

pected

Hutzler
Inc.

properties; for

(par

Proceeds—For

cents).

St., Boston 16, Mass.,

Nov.

on

share.

per

work on the Yellowknife
properties; and for cost /
concentration plant, mining
equipment, etc. Under¬
writer—Gearhart & Otis, Inc., New York. Statement ex-*'

(11/18)

Stuart

441

Price—$1.25

of

ment

of

filed

received

^

National Lithium Corp., New York
Feb. 19 filed 3,120,000 shares of common stock

Inc., New York City

Co.,

Inc-

—

$5).

(par

$2,000,000 first mortgage bonds, series A,
due Nov. 1, 1977. Proceeds — To repay bank loans and
for construction program. Underwriter — To be deter¬
mined by competitive bidding. Probable bidders:
Halsey,
Stuart & Co. Inc.; The First Boston Corp.; Kidder, Pea¬
body & Co. and White, Weld & Co. (jointly). Bids—To

(11/20)

Lighting & Power Co.

Proceeds—To

—

Ketchum

Oct.

Oct. 24 filed S4O.9O0JOOO first mortgage

To

Mifwaukee, Wis.

shares of

100.000

Co.,

National Cylinder Gas Co.
Aug. 28 filed $17,500,000 of subordinated debentures due
Sept. 1, 1977 (convertible on or before Sept. 1, 1967). '
Price
To be supplied by amendment. Proceeds
For
expansion and working capital. Underwriter
Merrill
Lynch, Pierce, Fenner & Beane, New York. Offering —

(11/26)
Sept. 27 filed 210,000 shares of common stock (par $1),
of which 43,000 shares are to be offered for account ol
the company and 167,000 shares for selling stockholders.
Price—To be supplied by amendment. Proceeds — For
general corporate purposes, including carrying of larger
inventories. Business—Wholesale drugs. Underwriter—
Hemphill, Noyes & Co., New York.

$6 per share at the rate of two new shares for each
five shares held. Proceeds—For working capital. Office
at

—Fort

Houston, Tex. Underwriter—Scott Taylor &
York, N. Y.

New

supplied by amendment.
Proceeds —To
selling stockholder.
Business—Pneumatic temperature
and air conditioning control systems.
Underwriter —
Piobert W. Baird & Co., Inc., Wilwaukee, Wis.

to the

class

of

Service Co.,

filed

1

Price

Home Owners

$100 debenture

provements; for retirement of present preferred shares;
and for working capital, etc. Underwriter—None.

bonds, series D, due May i,
1982, of Connecticut Power Co. on a par-for-par bas»i«
The exchange offer expires on Dec. 27.
Underwriter

offered

a

or

.

stock

mon

Price—Par for debenture, plus

share of stock.

.

Sept. 10

$2 per share for each 10 shares of Stock. Proceeds—For
construction of a shopping center and other capital im¬

and general mortgage

Nov. 1 filed 50.000 shares of class A common

of stock,

10 shares

debenture and

New Yoi'k.
Hartford

Biochemicals, Inc. ^ 4
(letter of notification) 100,000 shares of com- 1
(par 10 cents). Price—$3 per share. Proceeds
—For cost of plant and
inventory and for general cor¬
porate purposes. Office—Room 202 Houston Title
Bldg.,

Inc.,

Julv 30 filed $10,000,000

corporate purposes. Office —
Toronto, Canada. Underwriter

•

National

Washington, D. C.
of 512-8% sinking fund deben¬
tures due Aug. 1, 1972 and 100,000 shares of common
stock (par 20 cents) to be offered in units of a $1,000
Janaf,

39

1

28

filed

Co., Houston, Texas

165,000 shares of

common stock
(par $1),
3,000 shares. Price
supplied by amendment. Proceeds
To dis¬
charge trade accounts payable, to buy tools and equip¬
ment and for working capital.
Underwriter—None;* "
Pan-Israel Oil Co., Panama
*

to be offered in blocks of not less than

be

—

-

,

Sept. 27 filed voting trust certificates covering 1.000,000
shares of

common

stock

ket on the American

(par

Stock

one

cent).

Exchange.

Price—At
Proceeds

mar¬

—

For

Volume 186

Number 5690

.

..The Commercial and Financial Chronicle

.

(2141)
exploratory

< drilling
• and
^development x>f presently
licensed acreage and for
acquisition of additional acre¬

Underwriter—None.

age.

'

*

Pearce-Simpson,lnc.,Miami,

Nov.jTvliled

cents).

415,450

Price—$1

shares

penditures; to retire loans

and notes

inventories, tools, and "other corporate
Underwriter—Christopher Corp., Miami, Fla.
Oct. 28

'

Suite

stock

outstanding;

for

Peoples

■' ■%-

(par 50
Proceeds—For capital ex¬

share..

per

w

1,000,000

stock. Price—At par ($1 per

1957,

i

Rule

types of programs for accumulation

Investing {.Programs, in the total
.

stock.

ceeds

Price—At

par

(five cents

expenses.

Office

508

Great Plains Life Bldg.,
Lubbock, Tex. Underwriter—Sterling Securities Co., Inc.,
Odessa, Tex.
—

Ramapo Uranium Corp.

Aug. 13 filed! 125,000 shares of

stock

common

-

(par

one

cent). Price—$5 per share.'Proceeds—For
exploration
and development of
properties and completion of a ura¬
nium
concentrating pilor mill. Office—295 Madison Ave..
New York 17, N. Y.

with

Rapid Electrotype Co.,
Cincinnati, Ohio

mon

$40 of debentures for each Colortype common
share. The
offer will expire Nov.
19, 1957, unless extended, and
shall become effective whenever it
has been accepted by
holders of 40,000 Colortype common
shares, but may be
declared effective as to all or
any lesser number of such

Underwriter—None.

Statement

125,787
Oct.

shares.

30.

ir Reda Pump Co., Bartlesville, Okla.
Nov. 12 filed $1,000,000 of
participations in company's
Thrift Plan for eligible
employees of company and its
subsidiaries, together with 55,556 shares of common
stock which- may be
purchased under said plan. Under¬
writer—None.

Reichhold Chemicals, Inc.
10 filed 200,000 shares of common
stock (par $1).
Price—To be supplied
by amendment. Proceeds—For
expansion program and working capital. Underwriter—

Oct.

Offering

—

Temporarily

convertible
stock
and

debentures

and

$125,000 of 10-year 10%
12,500 shares of common

(no par) to be offered in units of
shares of common stock.

one

$100 debenture

ten

Price—$200 per unit.
Proceeds—For equipment,
working capital and inven¬
tory. Office—7962 S. E. Powell Blvd.,
Portland, Ore.

Underwriter—Campbell
Resolute Bay
Oct. 29 (letter of

& Robbins, Inc., Portland, Ore.

Trading Co., Ltd.
notification) 30,000 shares of common
share). Proceeds—For work¬

ing capital, etc.

Business—Purchase and sale of commo¬
Office—St. John, N. B., Canada. Underwriter—
Irving Weis & Co., New York.
dities.

•ir Revenue Metal Mines Corp.
(letter of notification) 9,140 shares of common
stock
(no par).
Price—$10 per share. Proceeds—For
mining expenses. Office—2656 4th St., Boulder, Colo.
Underwriter—None.
Oct. 31

Finance Co.,

Inc.

(11/18-22)

Oct. U filed $900,000 of 6%
debentures due 1977
class B

240,000 shares of class
the debentures and
be offered

publicly

shares

attached), together with
common stock, of which all of

B

150,000 shares of class
and

the

•

Underwriter—Stroud

Reach

(Hal) Productions
Aug. 8 filed 375,000 shares of

Price-r—$3
'duction of

B

stock

remaining 90,000

reserved for exercise of stock

To be supplied
by amendment.

capital.

(with

stock warrants

common

warrants.

,

B

Price—

Co., Inc., Philadelphia,

(11/15)
common

stock

(par $1).

^hare. Proceeds—For expansion
filmed television commercials and for
per

will

class

Proceeds—For working

&

of

pro-

working
capital. Business—Produces^ films for television. Office
—Culver City, Cali£ Underwriter—S. D. Fuller &
Co.,
^New York.*'
r
*

.




to

be issued

in

share

exchange

share of preferred stock and
for each White class A or

stock

held.

Texam Oil Corp., San Antonio, Texas
May 29 filed 300,000 shares of common stock (par $1),
to be offered for subscription by common stockholders
on

B

for

•

and

Inc.

notification) 400,000 shares of com¬
Price—25 cents per share. Pro¬
ceeds—For milling expenses. Office—Room 205, Indus¬
trial Arts Bldg., E. 802 Pacific, Spokane 3, Wash. Under¬
par).

1

on

Nov. 18. Price

—100%

of
principal amount.
Proceeds—For expan¬
working capital and other corporate purposes.

Brothers, New York.

Southern Colorado
Oct.

Power

Co.

filed $1,780,780 of convertible debentures due
1, 1972 to be offered for subscription by common
stockholders of record about Nov. 13, 1957 on the basis
of $100 of debentures for each 40 shares of stock held;
rights to expire about Nov. 27, 1957. Price — 100% of
principal amount. Proceeds—Together with funds from
private sale of $1,500,000 5%% first mortgage bonds, to
repay bank loans and for new construction. Underwriters

•

Standard Oil

Oct.

15

Co.

Paine, Webber,

(New Jersey)

filed

6,549,124 shares of capital stock (par $7)
being offered for subscription by stockholders of record
Nov. 8, 1957, at the rate" of one new share for each 30
shares held; rights to expire on Dec. 18, 1957. Price—$44
per share.
Proceeds—To increase investments in sub¬
sidiary and affiliated companies. Underwriter—Morgan
Stanley & Co., New York.
Standard

Products Manufacturing Co.
notification) $165,000 of 7% 10-year
debentures and 11,000 shares of common stock
(par
$2.50) to be offered in units of $30 principal amount ol
debentures and two shares of stock. Price—$45 per unit.
Proceeds—For equipment and working capital.
Office
—2836 S. 16th St., Milwaukee, Wis.
Underwriter—The
Milwaukee Co., Milwaukee, Wis.
Oct.

3

Steel

(letter of

Suburban

Electric

Nov.
due

5

filed

1987.

Co.

(12/11)

$4,500,000 first mortgage bonds, series D,

Proceeds—To repay bank

struction program.'

Price—To be supplied by amendment. Proceeds—
bank loans, to repay all or part of an out¬

Union
.

Sept.

loans and for con¬
Underwriter—To be determined by

12

South

of

Africa

filed

$15,000,000 10-year external loan bonds
1, 1967. Price—To be supplied by amendment.
Proceeds—For transportation development program. Un¬
derwriter—Dillon, Read & Co. Inc., New York. Offering
—Postponed temporarily.
»
•
due Oct.

,

•

21

—Stone & Webster Securities Corp. and
Jackson & Curtis, both of New York.

Al¬

standing 5% term loan and/or provide additional work¬
ing capital. Office—Roanoke, 111. Underwriter—Whit®
& Co., St. Louis, Mo., on a best-efforts basis.

the

basis of $100 principal amount of debentures for each 20

Underwriter—Lehman

corporate purposes. Underwriter—None.
Owens of Waterloo, la., is President.

E.

To reduce

Smith-Corona, Inc.
11 filed $4,235,700 of 6% convertible subordinated
subscrip¬

sion,

other

stock.

Oct.

on

Pro¬

Underwriter—Dillon,

and 30,000 shares of class A common stock (par $1) to
be offered in units of $500 of debentures and 25 shares of

Theodore A. Tester is President.

rights to expire

Price—To be supplied by amendment.

Ulrich Manufacturing Co.
Sept. 24 filed $600,000 of 6% sinking fund debentures

of

shares held;

(11/15)

writers—Blyth & Co., Inc., San Francisco and New York;
and The First Boston Corp., New York.

layed.

common

Corp.

• Tucson
Gas, Electric Light & Power Co. (11/15),
Sept. 25 filed 200,000 shares of common stock (par $5).
Price—To be supplied by amendment. Proceeds—To re¬
pay bank loans and for construction program.
Under¬

selling stockholders. Underwriter—Merrill Lynch, Pierce,
Fenner & Beane, New York. Offering—Temporarily de¬

(no

Transmission

ir Trans-America Uranium Mining Corp.,
Waterloo, Iowa
shares of common stock (par on®
mill). Price—25 cents per .share., Proceeds—For land
acquisition, exploratory work, working capital, reserves,

fred

(letter

Eastern

Nov. 6 filed 3,000,000

drilling of oil wells.' Office—Suite 14, 1500
Ave., N. W., Washington, D. C. Under-

writer—None.

Texas

(par $100).

Simplicity Pattern Co. Inc.
10 filed 155,000 shares of common stock (par $1).

1

shares for each share held. Pries

ceeds—For gas expansion program.
Read & Co. Inc., New York.

Oct.

stock

new

be

Oct. 24 filed 200,000 shares of cumulative preferred stock

com¬

Price—To be supplied by amendment. Proceeds—To two

Nov.

basis of two

supplied by amendment. Proceeds—To repay
indebtedness, for acquisition and exploration of oil and
gas leases, for drilling and completion of wells, and for
other corporate pumoses. Underwriter—None.

IV2 shares of
class

a

—To

Underwriter—None.

Uranium

and

Underwriter—N one.

writer—None.

ir Skookum

—r

Tex-Star Oil & Gas Corp., Dallas, Texas

Massachusetts
.

Proceeds

Oct. 14 filed 600,000 shares of common stock (par $1) t®
be offered in exchange for leases on certain
properties.

holders; then to public. Price—$1.25 per share to stock¬
holders; $1.37 Vz to public. Proceeds—For expenses in¬
cidental to

supplied by amendment.

ing—Indefinitely postponed.

Laboratories, Inc. (which is to be merged
Corp. effective Sept. 19, 1957) on the

■

-

$1)

be

retire short term bank loans and for working capital

general corporate purposes. Office — Rochester, N. Y.
Underwriter—The First Boston Corp., New York. Offer¬

Dec.

stock. Price—At par
($5 per

-Ritter

(par

$10) to

offered for subscription by common'"stockholders on
basis of one new share for each four shares held.

Price—To

(11/14)

debentures due May 1, 1978, being offered for
tion by common stockholders of record Nov.

Research Instrument
Corp.
7 (letter o£
ftotification)

Oct.

the

Oil Corp.
Sept. 11 (letter of notification) 40,000 shares of common
stock ((par $1) to be offered for subscription by stock¬

mon

Blyth & Co.,,Inc., New York.
postponed.
.-Vir

be

Shacron

shares

common

effective

one

common

$4,854,600 of 7% sinking fund subordinated
debentures due Nov. 15,
1967, being offered in exchange
for common stock of American
Colortype Co. at rate of

Electrotype
already
owns
(52.66%) of the outstanding Colortype

Schering

basis of

Oct. 2 filed

shares.

stock

common

Underwriter—None.

•

Taylor Instrument Companies
Oct. 1 filed 99,195 shares of common stock (par

—

stock of White

common

Congress.

Schering Corp., Bloomfield, N. J.
Sept. 19 filed 278,983 shares of 5% cumulative con¬
vertible preferred stock (par $30) and
418,475 shares of

(New York)

t

Equitable Securities Corp., Nashville, Tenn. Offering—•
Held up pending passing of
necessary legislation by

for

bidding. Probable bidders: Halsey, Stuart & Co.
Inc.; The First Boston Corp.; Merrill Lynch, Pierce, Fenner & Beane;
White, Weld & Co. and Kidder, Peabody
& Co. (jointly).
Bids — To be received up to 11 a.m.
(EST) on Nov. 14 at 90 Broad St., New York, N. Y.

,

mining

(par,

Tax Exempt Bond
Fund, Inc., Washington, D. C»
June 20 filed 40,000 shares of common stock. Price—$28
per share.
Proceeds —- For investment. Underwriter—„

tive

Oct. 24 (letter of
notification) 236,000 shares of common
(par $1). Price—$1.25 per share. Proceeds—For

stock

stock; unsubscribed shares to be offeree!
employees and officers. Price—$2 per share*
Proceeds—To pay outstanding obligations to Ogden Corp.
Underwriter—None.

Construction Co.

Savannah Electric & Power Co.

common

Proceeds—For explora¬

certain

to

Oct. 16 filed $6,000,000 of first mortgage bonds due 1987.
To repay bank loans and for construction
program. Underwriter—To be determined by competi¬
Proceeds

Pyramid Mining & Metal Corp.

stock

20

Offering—Indefinitely postponed.

For

—

i

each

—

Pro¬

geological studies, reserve for contingent
liability, for machinery and equipment and other re¬
serves.
Office
616 Judge Bldg., Salt Lake
City, Utah.
Underwriter—Steven Randall & Co.,
Inc., New York.
—

for

Price—$97 per share. Proceed*
—To R. M. Realty
Co., who is the selling stockholder.
Underwriter
Yates, Heitner & Woods, St. Louis, Mo.

com¬

share).

per

debentures

St. Louis Insurance
Corp., St. Louis, Mo.
March 27 filed 1/250 shares of class C cumulative
pre¬
ferred stock (par $57).

'

Valley Oil & Mining Corp.
;
Sept. 30 (letter of notification) 2,000,000 Shares of
mon

Ogden

of

—None.

Pleasant

.

$100

working capital and investment in addi¬
tional equipment.
Office—Nashville, Tenn. Underwriter

amount... of

.....

(C. F.)

loans and

the

Philadelphia Fund, Inc., namely Sys¬
tematic Investment.Programs With
Insurance, System¬
atic Investment
Programs Without Insurance and Single
Payment

of

Sept. 13 filed 127,289 shares of common stock (par $10).
Price—$13 per share. Proceeds—To retire outstanding

★ Planned Investment Corp., New York

$2,000/000.

of

share.

four shares held and to holders of
options on the basie
one share for each
option to purchase four shares oA

1, 1977 to be offered for sub¬
stockholders of record Nov. 20,

common stock
held; rights to expire on Dec. 4.
Price—To be supplied by amendment. Proceeds—To reduce bank loans and for working capital. Underwriter—

President.

of

basis

per

Syntex Corp. (Republic of Panama)
j
July 24 filed 1,165,75Q shares of common stock (par $2)
to be offered for
subscription by common stockholders
of Ogden Corp. on the basis of one new share for
each

Kuhn, Loeb & Co., New York.

—

13 filed three

on

common

Price—$1

ton, Tex.

shares of

—

shares

share). Proceeds—For work¬

ated debentures due Dec.

by
the

cent).

tion and exploitation of
oil, gas and sulphur properties*
Underwriter—T. J. Campbell Investment Co., Inc., Hous¬

common

Royal McBee Corp. (11/21)
Nov. 1 filed $7,675,300 of 20-year convertible subordin¬

—

of

one

Office—705 South Husband St., Stillwater,
Underwriter—Richard B. Burns Securities Agency,
Stillwater, Okla.

scription

Dec. 11 at 441 Stuart
St., Boston 16, Mass.

Surinam Corp., Houston, Tex.
Oct. 21 filed ID,000,000 shares of

Okla.

preorganization

bidding; Probable bidders:- Halsey, Stuart
Kidder, Peabody & Co. and White, Weld &
(jointly). Bids—To be received up to 11 a.m. (EST)

Co. Inc.;

on

Colo.Under-

ing capital.

subscriptions to
250,000 preorganization
subscriptions to class B non-voting common stock to be
offered in units of .four class A shares and one class B
share, the purchaser agreeing to donate each class B
share to the Peoples
Security Foundation for Christian
Education, to be incorporated as a non-profit corpora¬
tion. Price—-$2 per share. Proceeds
For capital and
surplus to finance a proposed insurance
company to be
named Peoples
Security & Endowment Co. of America.
Office
Montgomery, Ala. Underwriter
None. T. J.

Nov.

800, 655 Broadway Bldg., Denver,
riter—R. B. Ford, Memphis, Tenn.

Records, Inc. •
'. J
July 22 (letter of notification) 11,022 shares of

class A voting common stock
and

Patterson is

&

Co.

Rose

and

purposes.

Security Investment Co.

filed

competitive

stock./price—At par (SI per share). Proceeds—To pay
existing indebtedness and for working capital. Office—

Fla. ! |

common!

of

ir Rocky Mountain Quarter Itacing Association, Inc.
(letter of notification) 300,000 shares of common

Oct. 31

*■

^,|I"

.

-

41

United

States

Coconut

Fiber

Corp.

(11/18-22)'

Sept. 30 filed 735,000 shares of corhmon stock (par $1>.
Price—$4 per share. Proceeds—For expansion program
and other corporate purposes.
Underwriter
United

—

Office—Washington, D. C.
Corp., New York.

Southeastern Securities

States Sulphur Corp.

Oct. 8 filed

1,500,000 shares of common stock (par one
cent). Price—$1 per share. Proceeds—For plant rental,
etc.; to retire corporate notes; for core drilling; for
working capital; and for other exploration and develop¬
Office

work.

ment

—

Houston,

Texas.

Underwriter

—

None.
Universal

Oct.

31

Drilling Co.,

filed

400,000

shares

Inc., New Orleans, La.
of class A common stock

(par $1). Price—$5.50 per share. Proceeds—To pay ob¬
ligations incurred and to be incurred in connection with
and for
working capital and other corporate purposes.
Under¬
writer—Kohlmeyer & Co., New Orleans, La.
construction and equipping of a drilling barge;

Uranium Corp. of America, Portland, Ore.
April 30 filed 1,250,000 shares of common stock (par 10
cents). Price—To be supplied by amendment (expected
to be $1 per share). Proceeds—For exploration purposes.
Underwriter—To be named by amendment. Graham Al¬
bert Griswold of Portland, Ore., is President.
Victoreen Instrument Co.,
Oct.

9

filed

$1,000,000

of

6%

Cleveland, O.
convertible subordinated

debentures due Nov. 15, 1967 to be offered for subscrip¬
tion by common stockholders at the rate of $100 o£

Continued

on

page

42

•

42

The Commercial and Financial Chronicle

(2142)

Continued

from

each

for

debentures

Price—To

be

page
100

supplied

Blyth

41
held.
Proceeds—For

shares of common stock

amendment.

by

expansion and working capital. Underwriter—Saunders,
Stiver & Co., Cleveland, Ohio.

Virginia

Electric &

Oct. 29 filed $20,000,000

Power Co. (12/3)
of first and refunding mortgage

bonds, series N, due Dec. 1, 1987. Proceeds—For con¬
struction expenditures.
Underwriter—To be determined

competitive
bidding.
Probable
bidders: Halsey,
Stuart & Co. Inc.; Kuhn, Loeb & Co. and American Se¬
curities Corp. (jointly); Salomon Bros. & Hutzler; East¬
man Dillon,
Union Securities & Co.; Stone & Webster
Securities Corp.; White, Weld & Co. Bids—Expected to
be received up to 11 a.m. (EST) on Dec. 3.
Warwick Valley Telephone
24 (letter of notification)

Co.
4,708 shares of common
stock (no par) to be offered for subscription by common
Oct.

on

shares held.
struction of

the basis of one new share for each two

Price—$20 per share. Proceeds—For con¬
telephone plant. Office — 47-49 Main

new

St., Warwick, N. Y. Underwriter—None.
Washington National Development Corp.
Oct. 2

(letter of notification) 50,000 shares of common
stock (par $1) of which 34,280 shares are to be offered
publicly at $1.20 per share and 15,720 shares are to be
offered to certain individuals under options. Proceeds—
For general corporate purposes. Office —* 3612 Quesada
St., N. W., Washington, D. C. Underwriter—Wagner &
Co., New York City.
Western
Oct.
Price

Chrome, Inc., Salt Lake City, Utah

filed 300,000 shares of common stock

10

(par $1).
Proceeds —To

To be supplied by amendment.
develop chromite mines in Siskiyou County in northern
—

Underwriter—None. J. Bracken Lee is Presi¬

California.
dent.

Co., Inc., New York.

reported

was

issue $4,500,000

may

company

mortgage bonds.
Underwriter — To be deter¬
mined by competitive bidding. Probable bidders: Halsey,

and Coffin
(jointly). Bids—
Tentatively expected to be received in January.
Stuart

Co.

&

Central

Inc.; The First Boston Corp.;

and F. S. Moseley & Co.

& Burr, Inc.

Public Service Co.

Illinois

April 9 it was reported company plans to Issue and sell
$10,000,000 of 1st mtge. bonds.Proceeds—To reduce bank
loans and for construction program. Underwriter—To be
determined

by competitive biddtog.
Probable bidders:
Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler;
Equitable Securities Corp.; Eastman Dillon, Union Secu¬
rities &

Co.; Blyth & Co., Inc.; Kidder, Peabody & Co.;
and Merrill Lynch, Pierce, Fenner & Beane (jointly);
Kuhn, Loeb & Co. and A. C. Allyn & Co., Inc. (jointly)
Offering—Expected late in 1957.
Chesapeake & Potomac Tel. Co. of Md.

(12/9)
July 30 it was announced company plans to issue and
sell $30,000,000 of debentures.
Proceeds—To repay ad¬
vances from American Telephone & Telegraph Co., the
parent. Underwriter—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
White, Weld & Co.; Morgan Stanley & Co.; Kuhn, Loeb
& Co.; The First Boston Corp.; Harriman Ripley & Co.
Inc.
Bids—Expected to be received up to 11:30 a.m.
(EST) on Dec. 9.
City Investing Co., New York
July 30, Robert W. Dowling, President, announced that
the directors are giving consideration to the possible
issuance

future

which

debentures

of

could

be

used

largely to acquire investments producing ordinary
as well as those with growth potentials.

Wisconsin Public Service

Corp. (12/5)
$7,000,000 of first mortgage bonds due Dec.
Proceeds—For construction program and to

1,

1987.
repay bank loans.
Underwriters—To be determined bycompetitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; Kidder, Peabody & Co.; The First Boston
Corp.; Merrill Lynch, Pierce, Fenner & Beane; Salomon
Bros. & Hutzler and Eastman

Dillon, Union Securities &
Dean Witter & Co.; Lehman Brothers;
White, Weld & Co. Bids—Expected to be received up

(jointly);

10

(CST)
Chicago 4, 111.
a.m.

on

Dec.

5

at

231

So.

Salle

La

St.,

Woodbury Telephone Co.
Sept. 23 (letter of notification) 3,533 shares of common
stock being offered for subscription by common stock¬
holders of record Oct. 25, 1957 on the basis of one new
share for each three shares held; rights to expire Nov.
22,
1957. Price—At par ($25 per share). Proceeds—To repay
all short term bank notes and for construction
program.

Office—Woodbury, Conn.

Underwriter—None.

Wycotah Oil & Uranium, Inc., Denver, Colo.
July 29 filed 375,000 shares of common stock (par $1).
Price—$4 per share. Proceeds—For acquisition of prop¬
erty and for other corporate
Teden

&

Co.,

Inc.,

New

Underwriter —
Statement effective

purposes.

York.

Oct. 24.
Zale

Oct.

25

Transmission

Coastal

Colorado

sell

Fuel &

was

Corp.

about

$25,000,000

Commonwealth
Nov. 4 it
000

Iron Corp.

reported company now plans to issue and

Underwriter—Allen

Edison

Co.

1977.

due

(1/14)

announced company plans

was

of mortgage

construction

first mortgage bonds
Co., New York.

&

bonds

or

to sell $50,000,Proceeds — For

debentures.

Underwriter—To be determined
Probable bidders: Halsey, Stuart
Inc.; The First Boston Corp.; Glore, Forgan & Co.
Bids—Tentatively expected to be received on Jan. 14,
program.

by competitive bidding.

Registration

Planned for

—

about

the

middle

of

Connecticut

Ljght & Power Co.

Feb. 18, it was reported company plans to sell not lesi
than $20,000,000 of first mortgage bonds, possibly thii
Fall, depending upon market conditions. Proceeds—Foi
construction

Underwriter — Putnam & Co.,
Hartford, Conn.; Chas. W. Scranton & Co., New Haven.
program.

Conn.; and Estabrook & Co.. Boston, Mass.
•

Crucible

Sept. 18 it

Steel

was

Co.

of

announced company planned to offer to its

share of preferred stock for each 36 shares

one

filed

Stockholders

stock

common

held, but offering has been postponed.

100,000 shares of common stock (par $1).
Price
To be supplied by amendment.
Proceeds
To
expand operations and for working capital. Underwriter

At par ($100 per share). Proceeds—Together with funds
from sale of additional mortgage bonds, to be used for

—Eppler, Guerin & Turner, Inc., Dallas, Texas.

expansion

Nov. 7 approved the new issue.

on

program.

Underwriter

—

The

Price—

First

Boston

Corp., New York.
Darco

Prospective Offerings

Atlantic

later

City Electric Co.

!'■ ®ayard L. England, President, announced
this

that

the company will probably issue about
$5,000,000 of convertible debentures. Proceeds—For con¬
year

struction program.

Underwriter—May be determined by
competitive bidding. Probable bidders: Halsey, Stuart &
> Loeb & Co., American Securities Corp.
Wood, Struthers & Co. (jointly); White, Weld & Co.
(jointly); The First Boston Corp. and
Drexel & Co. (jointly); Eastman
Dillon, Union Securi¬
ties & Co. and
Smith, Barney & Co. (jointly); Lee Higgmson Corp.; Blyth & Co., Inc.

j
and

T?rC''

and Shields & Co.

•

Baltimore & Ohio RR.
will be received by

Bids

New

York

5, N. Y.,

™*.J?urJha"i
certificates. Probable

up

(12/5)
the

to

company

noon

(EST)

of $3>435>000

at
on

2 Wall St.,
Dec. 5 for

equipment

trust

bidders: Halsey, Stuart & Co.
Inc.;
Salomon Bros. & Hutzler.

Brooklyn Union Gas Co.
and sell
first
bank

17??

second quarter of 1958.
Proceeds —To repay
loans and for construction
program.
Underwriter

or

bidders.

determined by competitive

Halsey,

bidding.

Probable
Stuart & Co. Inc.; Lehman
Brothers;




reported registration is expected of ap¬
proximately 275,000 shares of common stock, of which
about 225,000 shares are to be sold for account of com¬
pany and 50,000 shares for selling stockholders. Business
was

—Manufactures

products for commercial and military
Underwriter—William R. Staats &

aircraft and missiles.

Co., Los Angeles, Calif.

$100 of

April 3 it was announced company may need additional
capital of between $25,000,000 and $35,000,000 during the
next two years.

Underwriter—For

any

bonds to be de¬

termined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; White, Weld
& Co., and Kidder, Peabody & Co.
(jointly).
Eastern Utilities Associates

April 15
and

it

sell

was

announced

$3,750,000

Proceeds

—

of

company

25-year

For advances

to

to

proposes

collateral

Blackstone

trust

issue

bonds.

Valley Gas &

Electric

Co., a subsidiary. Underwriter—To be deter¬
mined by competitive bidding. Probable bidders: Hal¬
sey, Stuart & Co. Inc.; Kidder, Peabody & Co.; Blyth
& Co., Inc.; White, Weld &
Co.; Stone & Webster Se¬
curities Corp. and Estabrook & Co.
(jointly).
Falcon Seaboard

Oct.

28

it

was

110,000 shares of
—Lehman

Sept.

12

Drilling; Corp.

reported

that

a

common stock is

secondary
expected.

it

shares held

6,

crease

offering

of

Underwriter

Brothers, New York.
was

announced

the right to subscribe for
capital stock at the rate of
Dec.

(C. F.) Co., Waterville, Me.
- >
announced company plans soon to offer
stockholders some additional common
Underwriter—Probably H. M. Payson & Co., Port-

•;

Hathaway
it

June 24

its

to

was

common

stock.

Me./:

land,

V'.. .,v'

(Territory of)
(11/19)
The Treasurer of the Territory, at the Bankers

<

:

Hawaii

10

-

Trust Co., f

York, N. Y., will up to ^
bids for the purchase public improvement y

1515, 14 Wall Street, New

Room

(EST) on Nov. 19 receive
Territory of $7,000,000

a.m.

the

from

bonds, series B, dated Nov.,15, 1957 and due annually ^
Nov. 15, each year, to and including Nov. 15, 1977.,

on

&

Indiana

Michigan

Electric Co. ■(2/13/58)
vy ?
plans to issue and sell V,

Oct. 2T it was reported company

$25,000,000 of first mortgage bonds due 1988. Proceeds
—For
reduction of bank loans and for construction

<

Underwriter—To be determined by competi- ■
tive bidding.
Probable bidders: Halsey, Stuart & Co. y
Inc.; Harriman Ripley & Co. Inc.: The First Boston
Corp.; Eastman Dftflon, Union Securities & Co. Bids—
Tentatively expected to be received up to 11 a.m. (EST)
on Feb. 13,
1958;y
"
: ' '
; fx'^. - - 'y-- /.
program.

Laclede Gas Co.

plans to raise up to

$11,700,000 new money this year through sale-of new
securities. Proceeds—To repay bank loans and for con¬

program.7 Underwriter—For bonds, to be de- :
competitive bidding. Probable bidders: Hal- :
sey, Stuart & Co. Inc.; Lehman Brothers, Merrill Lynch,
Pierce, Fenner & Beane and Reinholdt & Gardner (joint¬
ly).
•
... N'-v. V..
•
--V
.
■
,
Lieberknecht (Karl ), Inc. (11/29)
:
Bids will be received up' to 11 a.m. (EST) omNov. 20 at >
the Office of Alien Property, 101 Indiana Avenue, N. W., »
Washington 25, £>. C., for the purchase from the Attorncy General of the United
States," as an entirety, of .
158,025 shares of capital stock (no par) of this corpora- ,
tion.
This represents 63.21% of the total number of >
shares
outstanding. -On Oct.* 17, 1956, ' the .Attorney .
General rejected'all bids received for the stock, including a high bid of $3,005,100.

struction

termined by

Long Island

,Lighting Co.

plans to sell later
$40,000>000 of first mortgage bonds, series J. "
$12,000,000 of series C Uonds due >

16 it was announced company

April
this

year

of

1957.

record

vJan. 1, 1958 and for construction program. Underwriter ;
—To be determined by competitive bidding. Probable^
bidders;7 Halsey;!Stuart* & Co/Inc.; The First Boston /
Corp. and Blyth

Oct.

Price—$21

capital and surplus.

& Co. Inc. (jointly); W, C, Langley &
& Co.-Tjointly)^/<■■//v.*-;

Go. and Smith,-Barney

are

expected to be received by the company some
Fall for the purchase from it of $14,400,000

V

Hal-

>

jtfust certificates. Probable bidders:

of equipment
sey,

Stuart & C6. Inc.;' Salomon Bros.

& Hutzler.

Mangel Stores Corp.
v/'V'Y1'
19 it was reported company plans registration
issue of

$3,QOOvOOO of convertible debentures due

Underwriter—Lee Tligginson Corp., New

v

/.-•

..

of

June
an

•

RR. ;./*

& Nashville

Louisville

1972./

York.

^Power;Co.:'

Montana

May 20 it was reported company may issue and sell in
$20,000,000 of debt securities. Proceeds—
For construction program and to reduce bank loans.

the fall about

Probable

competitive bidding. >
Stuart & Co. Inc.; Eastman/

* Montreal

118,900
one

new

will

be

given
additional shares of
share for each three

18, 19.57; rights to expire
per

share.

Proceeds—To

Underwriter—None.

on

in¬

it

8

(City of)

debentures in
marketing the issue
five weeks.

voted to sell $18,000,000 of

was

v

States." Initial steps in

the

United

are

expected in four or

'

Montreal

Metropolitan Commission

Sept. 26 it was reported an
licly offered in the United

jected

a

issue of bonds may be pub- States. The Commission re-,

bid of 92.64% for an issue

of $6,376,000 of 20-

year bonds with an interest rate of 5%%. Underwriter
—May be determined by competitive bidding. Probable
bidders: Lehmah Brothers, White, Weld & Co., Eastman

Dillon, UnionSecurities

& Co., and Blyth &

Co., Inc.
Sav-

(jointly); Shields & Co., Halsey, Stuart & Co. Inc.,
ard '& Hart and Salomon Bros. & Hutzler (jointly).

•

Orleans Public Service Inc.
Nov. 5 it \va§ announced company plans to offer to its
common
stockholders the privilege of subscribing for
New

at the rate of
Middle South
holder of 1,215,089 shares (96.22%) of
outstanding eonimon stock, proposes to acquire its
rata share of the additional stock. Price—$25 per

157,851 additional shares of common stock
one new share fpr each eight shares held.
Utilities, Inc;y-as,
the

share.

(N. Y.)

White, Weld & Co.; Kid¬

Smith, Barney & Co., and Blyth &
Co., Inc. (jointly);. Merrill Lynch, Pierce, Fenner &
Beane and Stone & Webster Securities Corp. (jointly).*
der, Peabody & Co.;

pro

stockholders

bidders: Halsey,

Dillon, Union Securities & Co.;

Nov.

Eastern Gas & Fuel Associates

Federation Bank & Trust Co.

announced that
company expects to issue

$18,000,000 to $20,000,000 mortgage bonds in the

1, 2056 in exchange for the
standing $5 preferred stock (no

Dec.

Underwriter—To be determined by

Industries, Inc.

Sept. 23 it

Aircraft, Inc.
July 9 it was reported company plans to issue and sell
up to $12,500,000 common stock, following spin-off
by
California Eastern Aviation, Inc.
of its subsidiaries.
Land-Air, Inc. and Air Carrier Service Corp. into Air¬
craft, Inc., a new company. Underwriter—Cruttenden.
Podesta & Co., Chicago, 111.

"

<

ICC for permission to ■

debentures to mature •'
283,438 shares of outpar) on the basis of *.
debentures for each preferred share. ; ;/ ; >'

issue

Bids

stockholders the right to subscribe for 101,153
shares of cumulative convertible preferred stock on the
of

—

Gulf, Mobile & Ohio RR.
8 company applied to the
$28,343,800 of 5% income

Nov.

time in the

America

common

basis of

plans to issue some v

Proceeds—To refund

December.

Jewelry Co., in Dallas, Texas

—

+

& Co.

1958.

company

bonds, the amount of which has
determined. Proceeds — For construction
program.
Underwriters—Carl M. Loeb, Rhoades & Co.
and Merrill Lynch, Pierce, Fenner & Beane.
yet been

Aug. 5 it was announced company

Allen & Co.. both of New York.

Oct. 3 it

May 3 it was announced

in¬

July 1 it was reported the company plans to offer pub¬
licly about 191,000 units of securities for about $20,000,000 (each unit expected to consist of a $25 debenture oi
$35 interim note and five shares of $1 par commoD
stock). Proceeds—Together with other funds, for con¬
struction program. Underwriters—Lehman Brothers and

Nov. 5 filed

to

it

22

14, 1957

additional first mortgage
not

first

.Thursday, November

Gas Co.

Interstate

Gulf

(jointly);

come

(Canada)
Aug. 30 (letter of notification) 300,000 shares of common
stock. Price—At par ($1 per share). Proceeds—For de¬
velopment and exploratory work, drilling costs and sur¬
vey, and for working capital.
Office — 1205 Phillips
Square, Montreal, Canada. Underwriter—Jean R. Veditz

Co.

Moseley & Co.

F. S.

Cambridge Electric Light Co.
Oct.
of

Western Copperada Mining Corp.

•

Inc., and

Lynch, Pierce, Fenner & Beane; Harriman Rip¬
ley & Co. Inc. and The First Boston Corp. (jointly).

by

stockholders

Co.,

&

Merrill

..

Proceeds

writer—None.

For

—

v/

.

•

1

Norfolk & Western

Bids

are

construction program.

•

Under¬

•

Ry.

(12/4)

(1/22)

expected to be received by this company up

to

(EST) on Dec. 4 for the purchase from it of $4,140,000 equipment trust certificates (second instalment)
to mature semi-annually from May 1, 1958 to and innoon

Volume 186

Number 5690

eluding Nov. 1, 1972.

...

The Commercial and Financial
Chronicle

Bids for the remaining
$4,140,000

of

000,000 additional funds this

certificates of the same issue (third
instalment) are
expected to be received up to noon
(EST) on Jan 22
Probable bidders:.
Halsey, Stuart & Co. Inc.; Salomon
Bros. & Hutzler.
Northern

Aug. 29
until

Illinois

this

the

$8,000,000

Gas

company

first

half

and

1958

$10,000,000

has been made

-Ar Republic National Bank of Dallas

its

plan

early

its

that

it

to

this

has

deferred

raise

between

fall.

No

decision

any
bonds, to be
Probable bidders:

determined

by

competitive

stockholders

For

bidding.

Riddle
Oct. 21 it

Gas

Co.

Airlines, Inc.

bank loans and for construction
program.,

•

Ryder System,

in

Underwriter

.

;—To be determined .by competitive* bidding. Probable
J. bidders: The First Boston Corp. and Halsey, Stuart & Co.
Inc. (jointly); Blyth &
Co., Inc. Offering
Expected
either in

•

f

December, 1957

the Fall

Shell

Permian Basin
Oct.

23

it

Northern

lating

a

was

Pipeline

announced

Oct. 3 it

Co.

c o m

p a n

yj!a subsidiary

000

of.

Gas Co., is in the
process of formu¬
financing plan. Proceeds—To repay ad¬

parent, and for

new

construction.

an

Inc.

(11/21)

and

capital stock

$154,000,000).

conditions

Price

prevailing

Under¬

capital expenditures.

writer—Glore, Forgan & Co., New York.

Underwriter—

Public Service
-

,

Electric

&

Gas

be

governed

Jan. 14 it

was

determined

in

due

serially to 1974.

provements.

Lehman

issue of $3,000,000 bonds

Proceeds—To

finance

Bids—Expected to be received

Eastman

public im¬
on

Nov.

(jointly);

ering

was

reported that the company

may

Probable

Kidder,

Peabody

Dillon, Union Securities & Co.

sell

proposal to raise between $30,000,000 and $50,-

a

to

Despite

for

1958

high
pared

capital

and

planned

now

reduction in busi¬

sonie

plans
in

for

expendi¬

1959, the level
that

period

is

The

most

for

This

is

the

preliminary

crease

now,

of

survey

1956.

There

is

some

evidence, too, from the plans of
manufacturing companies for two
years ahead, that capital expend¬

bdlow

1957.

Of

now

those

reporting

77% plan to maintain or in¬
expenditures in 1959, com¬

siness'

pared, with 74% in October, 1955,
and, only 68% of those reporting
last year, whose plans were hold¬

New

ing

u

and
m

Plants

years

ahead.

e

t,

n

r

e

Nov.

Research

-

Most

-

and

Keezer

M.

Dexter

Keezer,

Vice

Presi¬

Director

of

the

Mc¬

Graw-Hill

Publishing Company's
Department of Economics which
conducted

the

during

survey

October.

the

plans

to

reduce

itures

in

1958

is

.

by

7%

20%

more

on

year.

and
small increases
by
petroleum industry, and by
transportation and communi¬

cations industries (excepting rail¬

&

All

Plan

to

Development

drop is the sharp increase

in

manufacturing capacity, while
production has been levelling out.

the

on

the

of

ca¬

survey

programs,

result of these research

including

companies

weight
Most

than

actual

spending in 1955 and only slightly




and

manufacturing
reduce capital

every

industry plans to
expenditures in 1958.

An excep¬

Capital spending is holding up
relatively well in the chemical

as a

total.;

But the 1958

increase

research

Almost

1959;

heavy

as

or

they

increases
paper,

the

frequent
research

of the

have

a

spending
reports of

are

in

the

electrical,
chemical
and
industries^* which
also
especially strong intentions

rubber
show

in

in

many

that

is

the

electrical

industry, which plans

machinery
13% in¬

a

crease.

process

1958

ing
cals,

will

Wisconsin

come

industries, with plans for
5%

in

and

off

only

seven

petroleum

4%

in

to

be

Southern

was

reported

the

market

early next

refin¬

chemi¬

in rubber and nine in

large
declines
are
re¬
ported for the basic materials in¬

include

may

year,

public fi¬

new

deben¬

some

Co., all of New York.

Gas Co.,

of record

company

Nov.

about

Inc.

plans to offer to stock¬

15, for

14-day standby,

a

additional 16,566 shares of common stock on a l-for-7

basis.

Underwriters—The

both of Madison,

be¬

Milwaukee

Co.,

Milwaukee,

dustries: 24%

Wis.

for steel, 38% non-

ferrous metals, and 24% for paper
and pulp.
In metalworking, as

foreshadowed

by

the

recent

mining
10%

iron

which

ore,

plan

a

increase.
Railroads

de¬

Cutting

"

cline

in

machine

tool

orders,

planned

spending is off sharply.
industry plans to spend
30% less next year. Other trans¬
port equipment makers (includ¬
ing aircraft) are cutting invest¬
ment 16%; machinery, 17; other
metalworking, 28.
The auto

10 to

industries
more

show

than 20%.

Railroads plan to cut back cap¬
ital spending by 27% in '58; in
the

Non-Manufacturing Industries
electric and gas utilities,
spending more than $6 bil¬
lion on new plants and equipment
The

after

in

are planning a
in '58.
This, the

1957,

crease

3%

in¬

report,

poinls
out,
may
reflect
rising
costs.
In 1959, almost half the
reporting electric utilities plan to
reduce capital expenditures, com¬
pared with 31% reporting plans
for
the
same
level,
and
24%
planning an increase.
This may
indicate that some original plans
for 1959 are now being stretched
into

1960.

The

petroleum

industry, which
six billion in '57,
increase in '58.

a
small
slightly
larger
drilling
ex¬
penditures,
more
tankers
and
more refinery expenditures (some
carried over from '57) account for

plans

the step-up.

Mining

expenditures

show

a

sharp drop, except for companies

"other

transportation

communications"

group,

a

and

small

increase results from

overall

the

planned deliveries of merchant
ships and new airliners.
Commercial

duced

their

business

firms

re¬

expenditures sharply

in 1957 and plan some further re¬

duction

next

year.
Indications
probably will not be
off as much, but there is no sign
as to when expenditures will start
up again.
Almost twice as many
of the big commercial firms plan
are

stone, clay and glass.

Very

into

Wis.; and Harley, Haydon & Co. and Bell & Farrell, Inc.,

also spent about

up

the sale of $5,000,000
expansion program. "Un¬

Co., Inc., San Francisco and New

ex¬

declines of

tion

finds,

overall,

report

Co.

Co. and Laurence M. Marks &

&

manufacturing

Curtail

Manufacturing industries,
average, operated at 82%

Gas

authorized

Proceeds—For

all

major
industries,
and all size groups of companies,
are now planning to spend less in
1958 than they reported earlier
this
year,
in the McGraw-Hill
Spring survey. The main reason
for the

Natural

directors

Food, textile and miscellaneous

Almost

certain

Co.;

convertible

roads).

development in 1958. About onethird say they will make substan¬
tial ' capital
expenditures
after

expend¬

survey

capital

compared with 1957.
total

and

companies
to
maintain

plan
expenditures

larger

Business,

next

this is a planned in¬
of 3% by electric and gas

were:

8

by Dr. Dexter

dent

capital ex¬
concentrated
in
where plans call
1958

pacity in September.
Other findings of

Equip-

leased

M.

for two

up

the

Only

Plans for

B

in

reduction

16%

a

crease

the

less than in

principal
finding of a

Price—Expected

Offsetting

plan
a /further
reduction
in
capital
spending for 1959.
At this time
last year, 32% planned to cut 1958

years.

cumulative

utilities

23% of those reporting

previous

drop

penditures
is
manufacturing,

drop 7%; but

itures may stabilize in 1959.

co in-

to

$10).

of

—Kidder, Peabody & Co., Blyth & Co., Inc., White, Weld

Oct. 17 it

capital spending based on re¬
search, in the years after 1959.

opment reported.

tures

(t>ar

payment

bidders:

an

70-cent

of

Valley

tures. Proceeds—For construction program. Underwriters

Bids—Not

for

remaining 20% above the level of 1955, and only slightly
below 1956. Increased expenditures on research and devel¬

ness'

the

nancing, mostly in bonds, but

announced company plans to issue and

shares

preferred stock

McGraw-Hill Survey Projects Small Decrease
In Capital Expenditures for 1958
Capital spending by business in 1958-1959

was

150,000

of

8, Kensey M. Robinson, President, stated that the

holders

July 26 it

part

as

ol

stock

be

20.

be consid¬

receive

to

stockholders

common

common

probably in January, with $30,000,000 of

pected to be received until the Fall.

Quebec Hydro-Electric Commission*>

of

Washington Water Power Co.
Oct.

Superior Tool & Die Co.
Oct. 7 it

18

debentures.

at time of issue, proceeds—For
Underwriter—Morgan Grenfell &

competitive bidding.

Brothers

is

derwriter—Blyth &

Halsey, Stuart & Co. Inc.; The First Boston Corp. and
(Capital of)

and to

$2,500,000

York.

reported company plans to issue and sell

by

parent)

Washington

by market

$10,000,000 of first mortgage bonds. Underwriter—To

York.

an

Co., it

Oct.

£55,000,-

South Carolina Electric & Gas Co.

writer—May be Merrill Lynch, Pierce, Fenner & Beane,

Nov. 12 it was reported that

the

latter

company

1 it was announced company anticipates it will
sell in the Fall of 1957 or in
1958 $25,000,000 of preferred
stock.
Proceeds — For construction
program.
Under¬

ic Puerto Rico

its

the

plans to offer to stock¬

Co.

Aug.

New

Associates

Dealer-Manager—May be Kidder,
Peabody & Co., New York.

(equivalent to $112,000,000
To

—

assets

to

securities mentioned in this

Gas

Co., Ltd., London, England.
,

certain

Blackstone properties.

announced company

additional

year,

one

of Blackstone.
The latter, in turn,
dispose by negotiated sale the first three
paragraph.
April 15 it was also announced Blackstone plans to offer
to its common stockholders (other than Eastern Utilitiet

Transport & Trading Co., Ltd.
was

within

proposes

announced company plans to sell publicly
additional 200,000 shares of its common
program.

announced

was

Valley Gas &

for

Underwriter—Mor¬

holders early in 1958 between £40,000,000 and

.

Natural
new

from

vances

in January, 1958.

or

was

it

15

Blackstone

new

stock. Proceeds—For expansion
Blyth & Co., Inc., New York.

—

-

prevailing at time of issue.

Stanley & Co. in U. S.

Aug. 28 it

working capital and other

company, a subsidiary ol
Electric Co., plans to issue,
$4,000,000 of bonds, $1,100,000 of note#
and $900,000 of preferred stock to its parent in ex¬
change for $6,000,000 of notes to be issued in exchange

•

Pacific Gas & Electric Co.
m
16 directors authorized the .sale
of $60,000,000 first
and refunding
mortgage bonds. Proceeds..— To retire

Proceeds—For

purposes.

Valley Gas Co.
April

announced company plans
between
Fls.800
million
and

—

gan

future.

near

corporate

was

Proceeds—For capital expenditures.

Oct.

.

Engineering, Inc., Arcadia, Calif.

6, Harry Oedekerk, Chairman of the Board, an¬
nounced corporation plans a public stock issue in the

,

erned by market conditions

debentures/,-Underwriter—McDonald V& Co., Cleveland,
; Ohio,; Registration—Expected in near= future.

'

Tuttle
Nov.

early in 1958 to
Fls.1,000 million
(equivalent to $211,000,000 and $263,000,000) through a
"rights" offering to stockholders.
Price
To be gov¬

Ohio Water Service Co.- ;/Vvru.r. v."
.Sept, 26 it was reported company to..issue and sell in
.November ail issue of $1,500,000 convertible subordinated

n.l•*>'•

stock has been

Royal Dutch Petroleum Co.
Oct. 3 it

; ;

v

Transocean Corp. of California

May 21 it was announced company plans a public offer¬
ing of securities to provide about $6,700,000 of new
working capital.

7,500,000 to 15,000,000 shares. Proceeds
finance route expansion and for working
capital.
Underwriter—James II. Price & Co., Inc., Coral
Gables,
Fla. and New York, N. Y., handled previous
public
offering of 500,000 shares of common stock at $3.25 per
share in July,-1956.

Underwriter—McDonald

Registration—Expected in No¬

vember.

increased from

raise

•'

common

stock.

common

Co., Cleveland, Ohio.

i

The authorized

additional

some

&

—To

Northern Natural Gas Co.
Nov. 5 the directors authorized the
issuance of additional
iShares of common stock
(par $10), to be offered early in
1958 to common
stockholders on the basis,.of one new
.share for each eight shares
held.,;Underwriter—None.

-

Toledo Scale Co.

Sept. 26 it was reported that, following merger with
Houghton Elevator Co., Toledo Scale Co. plans to issue

announced company
issue of new common

yet determined.

reported company plans to issue and sell
?$2o,OOO,OO0 of debentures due 1977. Proceeds—To
repay
'bank loans and for construction
program.- Underwriter
-—Blyth & Co., Inc., San Francisco and New York.'

.

plans to offer to

record

223,125

plans to register with
the SEC an
stock, the number of
shares and the price at which
they will be offered not

was

..;>•••

quisition of Bethlehem Foundry & Machine Co. common
stock and for working capital and
general corporate pur¬
poses. Underwriter—Van Alstyne, Noel & Co., New York.

(11/25)

was
.

Northern Natural

Bank

capital and surplus. Underwriters—Walker, Aus¬
& Waggoner, The First Southwest Co. and Dallas
Rupe & Son, all of Dallas, Tex.

.

Sept.'9 it

of

that

tin

Halsey, Stuart & Co. Inc.; The. First
Corp.; Glore, Forgan & Co.; Blyth &
Co., Inc.

.Boston

announced

was

crease

no

—

it

share, depending upon mar-

ket conditions. Proceeds—To discharge a note of $1,160,500 held by City Industrial Co. in connection with ac¬

Nov. 25, 1957, the right to
additional shares of capital stock
(par $12) at the rate of one new share for each 12
shares held.
Price—$45 per share.
Proceeds—To in¬

to the

as

12

subscribe for

form of the
proposed financing,
consideration is being given to sale of
common
stock or securities convertible
into common stock.' Pro¬
ceeds— For construction
program.
Underwriter

'but

tween $11.12 Y2 and $11.50 per

Underwriters—The

year.

Corp. and A. E. Ames & Co., both of New

York.

Co.

announced

of

First Boston

Nov.

43

(2143)

that 1958

to
reduce
spending
plan to increase.
For

the

first

time

in

1959

since

as

1955,

manufacturing industry is
a lower rate of
generally pre¬
fers, but there are no industries
reporting really depressed levels
every

operating at
capacity than it

now

of business.
Effects

of

changes

in

the

de¬

fense program are

showing up in
planning by the aircraft industry.
Only 18%
of the aircraft and
parts companies plan higher re¬
search spending next year,
and
27% are cutting back.
This is
twice the proportion of any other
industry.
A little more than one-third

all

of

manufacturing companies say

they expect research to create
significant opportunities for cap¬
ital spending by the years after
1959.

„

44

The Commercial and

(2144)

With Thill Sees.

Financial Chronicle

Mutual Funds

— Edwin S.
connected with
Thill Securities Corporation, 704
North Eroadway.

MILWAUKEE, Wis.

has

become

Net Income Up

Twice Their Sales

For Los

In October

Mutual Fund

By ROBERT R. RICH

study of open-end investment
company
activity in the stock
market during October shows that

Boston Fund's Report on

(Special to The Financial Chronicle)

More

LOS ANGELES, Calif. —Meyer
Berner

have

and

been

Jonathan

S.

Cutting

the

staff of

George

added
&

to

Co.,

6399

this

55%

The

figures

/

r

Wil¬

Institute

chusetts

shire Boulevard.

of

-J

of their total assets in

50%
(Special to The Financial Chronicle)

60%

LOS ANGELES, Calif.

invested.

or more so

similar

a

:

study

On

(Special to The Financial Chronicle)

overall

an

in

Joins French & Crawford
i

(Special to The Financial Chronicle)

•ATLANTA, Ga. — Theodore W.
has joined the staff of

Rochester

mutual fund

stocks and

13

of

they turned in
for
redemp¬

over

them

tion in the pe¬

had

riod, accord¬
b.

"In

the

realization

that

stability of income and capital.
diversified

for

and

of

group

one

stocks

common

to

provide

growth potential which will partially offset

losses in
also constantly watching for signs
of changes in long-term trends which may indicate the desirability
of adjustments between different types of securities."

Street, Northwest.

a

purchasing

They

power.

are

It

New

FUND

England

The

ment

of New England
l'ully-managed invest¬

a

trust

with

its

assets

cur¬

rently
over
40%
invested
in
defensive-type holdings — on Oct.
made

25

1

public

their

report

to

FREE INFORMATION

shareholders for the nine months

FOLDER AND PROSPECTUS TO

ended

YOUR INVESTMENT DEALER OR

NATIONAL SECURITIES &
RESEARCH CORPORATION
Established 1930

120

Broadway, New York 5, N. Y.

cents

6'0

cents

Trustees
—■

total

dividends

to

80

per-share dividends from income
have increased 33V:»%r.from the

Only 5.3%
Fund

brings

cents per share, thus equaling the
all-time high set in 1956. Actual

Fund Declines

WRITE FOR

declined 8.0%
but regained more than half its
loss by month-end.
For the entire month,

in

paid

paid in

1948

1957.

the

to

80

Adjusted

to

reflect the reinvestment of capital

distributions

gain

during those
crease,
on

totaling

same

would

$5.96

the in¬
been 81%%

years,

have

each share owned

continuously

while

000

stocks

30M

the

effect

common

portfolio

was

Investor purchases of new mu¬
fund shares for the month

tual

totaled

while
re¬
$35,648,000.

$135,125,000
demptions came to
October

the 23rd consecutive

was

in

investor

which

pur¬

chases of shares exceeded the $100
million

mark.

"These
market

bear

figures

the

out

Airborne

Instruments

La¬

of open-end
investment companies during pre¬
vious periods of market decline,"
Mr. Burr said, "and corroborate
the fact that investment company

managements buy securities
as
long-term • investments
in
line
with

the

financial

objectives

the nine months

—

as

.

f

about
most

1%

because it

was

for the-

part concentrated in highly
short-term securities.

liquid

invest in

.

.

.

.

during the ninemonths period, as compared with
20.1 cents net income per share
similarly computed (on 8,935,274
shares) for the comparable 1956

period.

r.

Total net assets

\

of the fund as

kept. 30, 1957 were $94,196,462,
equivalent to $8.55 per share for
each of the 11,021,669 shares out¬
standing at that date.' This com¬
pares with net assets at Dec. 31,
1956 of $95,033,012, or $9.43 per
share for each of the 10,074,300
of

shares then outstanding.

current

the

During

year

the

of cash
and short-term governments from
a
low of 4.3% of .total assets at
March 31, to a high of 18.8% in

fund increased its holdings

mid-July, according to the report.
subsequent market decline,
the company made selective pur¬
chases of common, stocks, with the
result that cash and government

On the

equaled 11.2% of assets on
: ' :
;;
L-.

30.

Sept.

;

Mr.
Lovelace,
available, to take
advantage of further buying op¬
"According- to

these funds

are

portunities which may develop in
periods of market unsettlement
and business

readjustment, while

being created for a re¬

base is

sumption of the upward trend.
management of the fund con¬
regard the long-term in¬
vestment outlook with optimism.

The

tinue to

Tri-Continental

"

Opens

on

Buying

investor interest in
share of a broadly di¬
versified cross section of securi¬
at
30
Broad
Street, New York
ties under full-time professional
City. Mr. Plummer was previously
management is evidenced in the
a
partner in Cutter, Plummer & sharp increase in the number of
a

securities business from

offices

to

Gerard

offices at 8 Sandpiper

engage

He
R.

in

was

securities

a

formerly

Jobin

with

Investments

and

closed-end

the

common

has

stripped
all
other
companies' shares in

Limited.

Two With Merrill

(Special to The Financial Chronicle)

BOSTON,

Mass.

George

—

National Investors' Sales

Gatchell, Jr. and Ross B. Kenzie

Sales of shares of National In¬

are

with

affilited

far

out¬

investment
popularity.

Tri-Continental
common
an increase of- 506 plans
in the first nine months of 1957,
G. increasing the number to 1,721.
In the third quarter alone,
132

Lynch

.

now

a

nation's largest diver¬
investment
company.
The number of share¬
holders
investing in Tri-Conti¬
nental common under the New
York Stock Exchange's MIP has
increased by about 41% this year,
sified

Williams

Fla.—Jerry

TAMPA,
has opened
Road

owning

Corp., the

Jerry Williams Opens

business.

Growing

Monthly Investment Plans in the
common stock of Tri-Continental

Bennett.

measured

.

to/19.8

the average
(10,656,018)

on

shares

of

:

outstanding

Up 41%

"

.

share

per

number

MIP

James A. Plummer is conducting

common

shares Sonotone Corp. $1.25 con¬
by the Dow- vertible
preferred;
100
Climax
Jones
Industrial
Average were Molybdenum
common; 101 P. R.
down 8.6%; Standard &
Poor's
Mallory & Co. and 400 N. V.
Preferred Stock Index was
off P h i
11 ips Gloeilampenfabrieken.
3.4%; and the Dow-Jones 40- Securities sold in the
period in¬
Bond Average was off 13.6%. The
cluded 1,000 shares of Columbia
Trustees comment, in part, as fol¬
Broadcasting A common; 300
lows
on
the
fund's
relatively shares Minnesota
Mining & Mfg.
limited decline;
$4 preferred; 875 shares Stanroclc
In contrast to the sharp Uranium
common,
and 2,000
(13.6%) drop in the cited bond shares Consolidated Denison
average, the bond portion of the Mines common.
fund's
portfolio
was
off
only
stocks

cents

equivalent

was

of

their investors."

boratory 5%% convertible notes;
general decline in security prices 50M
Spartan Air Services 6s; 400
over

This

a

experience

J. A. Plummer

the

of

of

value

from

$66,346,000.

Portfolio Changes

Nucleonics, Chemistry & Elec¬
tronics Shares made the following
the 23 cents paid from net longterm capital gains on Jan. 30, the portfolio changes during the third
quarter of
1957:
Purchases
in¬
adjusted value of $19.28 compares
cluded 20M Pansteel Metallurgi¬
with $20.35 at the 1956 year-end,
cal 4%% convertible debentures;
a 5.3% decline.
reflects

the

sold

since 1943.

Sept. 30, 1957. The fund's
per-share net asset value was
$19.05 on Sept. 30. Adding back

This

open-end

investment company purchases of
common
stocks totaled $136,327,-

month

A MUTUAL

INVESTMENT

of the indus¬

assets

Investment

,

*

Industrial Average

income

current

Oct.-21;period

79%

on

During October the Dow-Jones
'

"They hold bonds and preferred stocks to provide relative
They hold a carefully selected,

Anderson

covering

-

showed an
almost
identical pattern," Mr. Burr said.
try's

type of security is suitable
under all conditions and that it is impossible to predict the future,
the managers of college endowment funds have employed policies
and methods very similar to those used by investment companies
like Boston Fund and other 'permanent' institutional investors to
attain satisfactory long-term results.
no

survey

1 through

based

and

the figures, Boardman Bump, a director of
Holyoke College, observes
•

previous

the Oct.

Boston Fund and Treasurer of Mount
in part:

"A

j

Company of America, Los An¬
geles, during the nine months
ended Sept. 30, 1957, excluding
realized gains on sales of secun-.
ties, was $2,106,121 as compared
with $1,794,111 for the same pe¬
riod in 1956, it was revealed today
by Jonathan B. Lovelace,: Presi¬
dent, in a third quarter report to
the stockholders# r.-i 1. '
•'

Burr, Exe¬

cutive Director of the Association.
v

in other forms of investment.
on

ing to Edward

Edward B. Burr

the great majority

when

than

shares

and

"Brevits" notes that this contrasts with

French & Crawford, Inc., 68

Spring

investors

bought more

basis, the present survey indicates that the
cash, 3.3% in preferred stocks,
stocks, 8.4% in real estate or mortgages and

common

Commenting

—
Cecil G.
with Francis I. du
Pont
&
Co., 1286 North Palm
Avenue.
He was formerly with
Goodbody & Co.

of

of the endowment funds had

common

10 years ago

market

and that their

institutions had 32.0% in bonds and

1.2%

now

com¬

buyers

balance in

on

stocks.

common

55.1%

SARASOTA, Fla.

were

1956

the survey range in size

University

anies

C omp

endowment

of such
endowment funds had less than one-third of their investments in

neth du Vail and

F. I. du Pont Adds!

aggregate

V'.V

,

The figures show that 31

With Bennett-Gladstone

Bundy is

-

of

Investm ent

the

Technology,

Cornell.

As¬

i\auonal

sociation

,

in

the

open-end members of

the 141

study

Lewiston, Maine.

affiliated

Manning Company, 8417 Beverly
Boulevard. *

1957

from $500,962,260 for Harvard to $3,793,241 for Bates College, in
Among endowments of more than $100,000,000
are those
of Yale, University of Chicago, Northwestern, Massa¬

LOS ANGELES, Calif. —Murry

now

with

Individual endowments included

— Ken¬
Joseph J. Conlin
with Bennett-Gladstone-

prominent
June 30 of

A similar tabulation as of June 30,

stocks.

mon

with M. J. Ross & Co., 6505

42
on

;also showed approximately 55% of the endowment funds in

(Special to The Financial Chronicle)

become

of

in common stocks

institutions

cover

funds of $2,4.94,198,930.

has

funds

endowment

were

year,

Wilshire

M. J. Ross Adds

are

the

of

according to a preliminary report of the
being made by Boston Fund.
,

Boulevard.

Bramson

than

colleges and universities

College Funds

Angeles

Net income for The

A

Two With Jonathan

Thursday, November 14,195%

Funds Purchases

(Special to The Financial Chronicle)

Day

...

Merrill

vestors

showed

plans were

added.' The other nine
stocks rank¬

closed-end company

Corp., the growth stock
Lynch, Pierce, Fenner & Beane, ing among the most popular ten
History has shown time and again mutual
fund, in the month of
that
the
in this field with MlP investors
18 Milk Street.
strongest
inflationary October, were the
largest since
had a combined total of 24 new
trends may be interrupted or even
February 1956, it was reported
quite sharply reversed for vary¬
plans in the same period.
by Francis F. Randolph, Chairman
Frank B. Whittemore
ing lengths of time.
In addi¬
and President.
Among the stocks of more than
tion, the fund's sizable defensive
Frank B. Whittemore, formerly 1,000 of the nation's leading cor¬
Proceeds
to
the
21
year-old
position provides money that is
investment company from 78,300 with the old Stock Exchange firm porations
available under
the
readily available to take advan¬ new shares sold
Exchange's Monthly Investment
during October of
Watson, Armstrong & Co., has
tage of more favorable buying totaled
$692,277.
This compared
Plan, the only ones leading Trilevels for common stocks when¬
with
Continental common in number
$505,983 in the preceding passed away.
...

ATOMIC SCIENCE

through
ATOMIC

ever

DEVELOPMENT

general

nomic

MUTUAL

business

conditions

and

more

propitious. ..."

FUND, INC.

The

GET THE FACTS AND FREE

PROSPECTUS

104th

Atomic

Development Securities Co., Inc.

1033 THIRTIETH STREET, N. W„

Dept. C-

WASHINGTON 7. O C.

Tel. FEderal 3-1000

-

report

shareholders

<

will

be

together

consecutive

mailed
with

t

i-l-t




to

the

quarterly divi¬

dend from net investment income
on

Nov.

dividend

1.

The fourth and

from

income in

final

1957

at the rate of 19 cents
per
<

eco¬

appear

is

share.

month and with the all-time high
for the company, set in February

1956, of $744,570.
Redemptions of shares also in¬
creased

in

amount

was

total

the

less

than

received from

Total

tors

October,

assets

of

but

the

half

the

sales.

National

Inves¬

approximated $60 million at
end

of

October.

W. N. Neil

Opens

of
plans are those of General
Electric,
General
Motors, Dow
Chemical, Standard Oil of New

William

H. Jersey, Sperry Rand and Radio
Corporation
of America.
New
Tri-Continental plans opened in
business
from
offices
at
Mer¬
the
third quarter were greater
cantile
Securities
Building. He
than for any of these companies
was previously with North Ameri¬
except for Standard Oil, whic
had nine more.
can Securities Company.
DALLAS,

Neil

is

Tex.

—

conducting

a

securities

~

I

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

(2145)

Continued jrom page 16

we

T

to

are

win

at least obtain

the

Cold

or

array

of "Syrias" it

the upper hand in

nized

as

war,

may be recog- clock of the coming Dreadful Parinfinitely more provoca- ity. No, we must and can hasten
tive than it looks right now.
the
processes
of
disintegration

it, this must be done before man¬
kind is overwhelmed by the holo¬
caust of hydrogen war.

The Importance of Allies to
U. S. Strategy and Policy

.

and

spirit—they are nevertheless part
of a single challenge. : The penalty
for ignoring or underrating the
ideological end and concentrating
almost entirely on dhe technolog¬
ical end of the great span, can be
total defeat.
The surest way to

prevent it is to win the Cold War.
For we can freeze to death as well
burn to death.

that

could

we

have

commodity only

on

that

It

„

.

With every

,

,

Vital Principles
to

seems

vital

me

at our dispsychological, political, diplomatic, economic. We
posal

-

that

—

resource

moral,

And this brings me back to the
technological pole in that arch of grasp two principles: First, the must make common cause with
more "unthinkable" a final showthe millions of Communist victims
power. The Kremlin recently an¬
nounced a successful test of an down becomes, the more success- already our allies and draw tens

blessed

strictly Com¬

Since the launching
artificial
satellite,

munist terms.

xru^

Two

ful

before

both

sides

have

an

Soviets' will

rifying

be

of nibbling

of

Second, the

in

and

re-

of millions

We

into the alliance.

more

must

increase

inde-

against the Soviets
ter- possible direction.

more

become, the

weapons

we

their

what

on

freedom

our

pendence.

more

effective becomes the Communist

pressures

from

every

There

is

a

NATO for combined Military Defense. Is it too much to hope that

strategy of intimidation.
a NATO
can be formed for comThe dangers inherent in both bined
operations on Political Deihese strategies have
been im- fense?
mensely enlarged by the Soviet
Sees But Five Years

fJfv.1?1?*1satellite.
iJ1

the first ar-

Its

military

im-

ni°^ lmm^ia?e
is immediate

oper¬

psychological impact

ational
mass

the

strategy
mains

-

domain of mind

-

m,.

War—in political offensives, prop¬ bility of purpose. The temporary
Intercontinental Ballistic Missile,
aganda duels, psychological cam¬ balmy weather has not melted the and
claimed that it had reached
paigns, wars of nerves. Taken to¬ ice of the Cold War. Soviet for¬ its
target area "a huge distance"
gether, these are changing the eign policy just now is as tough
away.
patterns of human society more and aggressive, its blasts against
The Moscow announcement on
deeply than did any shooting war the free nations are as chill and
the I. C. B. M. may be exaggerated
in our recorded past.
blustery, as in some of the nastiest
but it is not safe to rely on that
*
/Technology and ideology—these Stalin seasons.
assumption.
The crucial fact is
span
the fields of tension now
Gromyko at the United Nations that the
perfection of this weapon
prevailing : everywhere. / Though Assembly still made some of the is now
inevitable. Both sides know
so different in character—one be¬ familiar
noises
about
"peaceful its
principles and techniques. It
ing in the domain of matter,, the coexistence," but he left no doubt is
only a matter of time, therefore,
other in the

as

45

\

.

missile, after which its
production will become as

j believe that
five

years

we

within

have possibly

which

to

take

the

necessary steps to head off
catastrophe for the human race.

But, the perils we face and the
production
RYiSSia +-ca" urgency of the situation, admonpacity to frighten small nations jsb us not to
waste
even
five
Here, again the into
neutralism
or
submission
by suggesting a Two-Power deal, time element is
minutes'of this fcrfteious time. The
all-important.
and to exact political
over the heads of our allies.
Red
^blackmail free world under American leadfrom some big nations. More than
propaganda • - continues
to
play
Dangers of "Dreadful Parity"
ership must concentrate its best
ever before, a world with its eyes
variations on the theme of "relax¬
Because electronics
is
at
the
energies and resources on the sulixed
upon
the
Soviet-made
ing tensions" but it is only back¬ heart of this
preme task of weakening World
weapon, I have been
moon
will be inclined to yield
ground music
while the Com¬ close
Communism
from Within and
enough to its development
on a piecemeal basis rather than
munists go on steadily blowing up
from outside—to the point where
to believe that this climax will be
risk war.
little troubles into big ones. Mos¬
it ceases to be a peril. When this
reached within five years, and
Let us
grant, for argument's is
cow, in short, exploits our yearn¬
possibly sooner. At that point the
accomplished, the United Nathat
a
military stalemate tions will have the first real
ing for peace, as the best way of prime rivals will have achieved sake
opwould cancel out the chance of a
destroying any sense of urgency, the stalemate that
portunity to achieve agreement
figures in my
decision by a Hot War, as so many
on our part, in relation to the
po¬ own mind as
between
nations
on
a
practical
Dreadful Parity.
believe it will.
Doesnt this, in
litical struggle.
program of disarmament and to
of

Russia's

Khrushchev has joined this chorus

routine

as

•

»

the present

of atomic bombs.

—

The alarming fact is
free

world

where

that, in the
there is no¬

today,
the

near

concentration

on

the ideological front that there is
the

on :

technological

front.

At

the immediate postwar
ignored both sections
of the span.
We dismantled our
magnificent military machine and
at the same time gave unimpeded
right of way to Communist mis¬
chief in both Europe and Asia. It
took a series of major disasters—
the conquest of Czechoslovakia,
the
fall
of
China, the Korean
aggression—to splinter our smug¬
first,

in

years,

we

ness.

>

'

i

■

-.■Belatedly and reluctantly we
recognized the reality of the Cold
War and the danger of a Hot War.
So

went to the aid of Greece,

we

launched

the

Marshall

Plan,

un¬

the building of defensive

dertook

alliances,

and

large-scale

started

<

An

Soviet
world

first

Russia's^ influence

affairs

time

is growing.

in

in

For the

edifice

of

wishful

has been erected

Parity.

But

on

I, for

history, Russia has vinced

thinking

that Dreadful
one,

con¬

am

a

anti-colonial
movements
in
organize and sacrifice of
hour of Dreadful Parity.
and
Africa.
Even
while
The ideological chal¬ Asia
What if Red China, with a So¬
lenge seemed somehow too vague brandishing its ballistic? missile viet
gift of missiles in its posses¬
and esoteric to galvanize us into and its space satellite, it is ac¬
sion, chooses to end the impasse
full action. The pervasive fear of cepted by millions the world over
in Formosa or Korea at one blow?
nuclear war, in fact, fostered the as the noble champion of peace and
What if a Nasser, or some new
delusion that we were enjoying nuclear disarmament. The spokes¬
pocket-edition Hitler who may
peace, though in truth our world, men of freedom and genuine peace
emerge in the interim, has a nerv¬
are still on the defensive.
our interests,.our system of human
ous
finger on the pushbutton of
to

were

under continuous

as¬

The

sault.
Not

without

bruised

egos,

we

have gone through several binges
of

wishful

thinking.

Recall how

recently, after Stalin's death, some
people hailed the end of the Cold
War because of a supposed New
Look and a Diplomacy of Smiles
in Moscow. Then something called
the "Geneva spirit" was born on
a Swiss summit. That blithe spirit,

alas, had already departed by the
time

"

sense, imply that the dewill be sought by the Comon

another

Critical

Time for

Time

adequate Cold War
a mere holding ac¬

offensive—not

What starts

thermonuclear doom?

Element

blackmail

as
an

No

doubt

end

can

it

is

as

but

offensive

an

geared

to

and
Bulganin concluded a recent address in San
England to celebrate its Francisco with these words: "The

London, talks that

soon

thereafter

petered out in the usual futility.
One

perate

after

another

hopes

have foundered

these

deson


the rocks of Communist inflexi

.

T

...

.

,

.

body wants

true

Moscow

is

a

too

wise

tunities to obtain an education in
these fields. The effectiveness of
The moral prestige
of Soviet m9dern industry, as well as modCommunism-after the disclosures ein
weapons
depends upon an
tensions, yet his
vastly greater.

own

tensions

are

of Stalin's crimes during 25 of the

on

the

most

important

"if"—the

For the shadow
grows

the horizons

Soviet

and after the barsuppression of the Hungarpeople — is lower than ever

ian

before.

It

especially

taken

has

a

within the

nosedive

Communist

The Soviet intellec-

world itself.

to

risk

a

of the ultimate

more

ominous

of human affairs.

on

If

could
for

defeat

When the current
for

instance,

years

is

amount
the

to

West.

Syrian episode,

evaluated

a

hence in the mosaic of

States must preserve and

/Y

1

^

-

j

,

•

interce(ie

mfnaC~
«£ situations short of general war.
P£eserye ?ur economic
,

tuals, whose number is growing
larger all the time, are reaching
out more courageously for some
mental

creative

and

Students

and

freedoms.

®*r?ngf
?

maintain our finanJ
; P\°tect
the sources of vital

5S?

people genalltes
erally are ever bolder in asking unies
questions and rejecting party-line
S
answers.
The peasantry still reTo
mains

young

unreconciled

tivized

The

fate.

its

to

collec-

people's

ele¬

still

being met with promis¬
sory notes that are being repeat¬
edly renewed rather than fulfilled.
Meanwhile, the murderous strug¬
gle for power among the hierarchs
are

goes on

without abatement.

Khrushchev

and

henchmen

his

caught in a dilemma. Their
economy and the rise of a newly
educated managerial class require
are

This

that

we

certainly
can

the

That

time

does

not

mear

sit back and wait for

Communism

few within.
an

SAU+P1vLy
tiained nianAt tlle same time, the

Q

barous

so

victories

absolute

time element.

weapon

challenge
ing that

a^f^a

40 Soviet years,

bombing. mentary needs for food, clothes,
that "no¬ housing, everyday consumer goods

third world war."
It is the kind of generalization,
victory—is running out. If we are
that breeds dangerous
to prevent defeat in this area we however,
must intensify our efforts in the complacency. ■ In effect it enables
the
Communists
to operate with
field
of
psychological
warfare,
which I prefer to call psychological impunity as long as their aggres¬
sions are too small in scope, and
peacefare.
well enough
spaced in time, to
Mr. Allen W. Dulles, Director
avoid the showdown.
of the Central Intelligence Agency,
tion

Khrushchev
to

~

.

some degree of personal freedom
immense and alarm¬
and initiative. But when the ter¬
free peoples will
be
birth.
people of Russia, if given the time shocked into armed resistance. In¬ ror is relaxed, all the pent-up
hostility of the people breaks tr
Only this July, when old-timers to
continue
their
evolution
to stead it
spreads its challenge thin
the
surface
in
demands
tha*
like Molotov and Kaganovich bit
freedom out of the narrow bounds —in a series of moves, no single
the dust,
threaten the survival of the re
»our mood was one of
of
Communist dictatorship, will one of which would provoke or
gime. So their policy swings ir
hopeful speculation. The hope ap¬
plied in particular to the talks on themselves help to find a peace¬ justify war. Yet the sum-total of panic between gestures of mod
disarmament then under way in ful solution."
He put his finger seemingly
minor and unrelated eration and renewals of terror.
came

establish
effective
safeguards
against nuclear devastation.

level, by other
importance of the

foothold in the Middle

in this area.

values

cision

munists

that it rests on shifting means?. The
Even in this period of grace besands, not on the granite of real¬ Cold War would actually be mul- fore the advent of Dreadful ParEast
and thereby in the
entire
ity. The argument goes that with tiplied a hundredfold.
And this jty, physical force will, of course,
Mediterranean.
Its
naval
ships each side
weigh heavily in the scales.
The
capable of annihilating makes
the
struggle, by means
prowl the Mediterranean and the 1he
other, war will have become short of total war, our paramount
Red Seas, while Soviet arms and
before
bread
and
shoes, despite
"impossible" — "unthinkable" is concern.
planes and submarines pour into the
the serious risk to their political
consoling word most often
Egypt, Syria and Yemen. Com¬ used.
stability
involved
in
The Great Need—To Win the
depriving
munists have won control
in
a
their people of bread and shoes.
Cold War
The argument makes logic. But
key State in India and in British
We must exert our best efforts
The
stakes
are
too
high toi gam¬
unhappily logic is not the final
Guiana; pro-Western leaders have
ble survival on the thin margin
or even the main ingredient in the
lead, and in all events not to
been ousted in Ceylon; Moscow's
conduct of men and nations. Emo¬ of hope that logic will prevail, full behind in the race for weapon
influence grows apace
in Indo¬
We must maintain
tion, raised to a pitch of hysteria For even sheer accident may wash ascendancy.
nesia; Red China has intensified
We well - balanced"forces
for
air,
by the very magnitude of the out hopes geared to logic.
its
pressures
on
Burma, South
We must resolve
menace,
may
vanquish
reason. must do all we can to prevent a ground and sea.
Vietnam and other neighbors.
inter-service conflicts
Catastrophe could be touched off Hot War and I firmly believe that whatever
Only two weeks ago, the British by miscalculation. The temptation the surest way to prevent it is to there may be in the field of ballistic missiles and related weapForeign
Secretary, Mr.
Selwyn to strike a sudden knockout blow fight and win the Cold War.
Lloyd,
publicly voiced
anxiety may prove insuperable to madmen
After all, we are not without ons> ,aPd speed "P
developabout the continuing Soviet in¬ in
places of power, to paranoiac opportunities for taking the in- me
0 operational foims.
filtration and subversion "in most
The Soviet empire is
fanatics, to dictators in a mood itiative.
We must stimulate our promisof
the
countries
of
Asia
and of
desperation. We cannot know racked by inner pressures, prob- jnS young people to pursue courses
Africa." He said: "This process is who will be Khrushchev's succes¬
lems and dangers.
The enemy in science, engineering and related
going on. How far it has got varies. sor in the Kremlin, nor how soon
expertly
exploits
our
internal subjects and increase their opporobtained

military programs.
Sputnik—the Soviet-made satel¬
lite—streaking through our Amer¬
ican skies, is significant proof that
Russia
is
making greater
and
faster progress in technology than
was expected even by some of our
experts. We have seen, too, how
cleverly and swiftly the Com¬
But the Communist forces are at he
munist leaders exploit their tech¬
may appear.
nological advances' to create a work, eating away—an implacable,
Secretary of State Dulles makes
psychological impact upon people unrelenting onward movement."
an ominous observation in an ar¬
Most serious of all, in the con¬
everywhere.
ticle in the October issue of For¬
text of the war of ideas, the Com¬
eign Affairs. "Such weapons," he
Cold Facts of the Cold War
munists retain substantial initia¬
writes, "might in the future get
Because
military
forces
and tive in the propaganda duel, often into the hands of irresponsible
weapons in the hands of ruthless to the point of monopoly. Despite dictators and be used as a form of
dictators represent a more familiar its barbarous behavior in Hungary, international blackmail."
They
type of menace, our people over Soviet Russia still gets away with may, indeed, and that opens up
the years have been more readily the outrageous pose of champion another vista
of danger in the
aroused

common

to

disintegrate fror

would

element

—

be

to

the

forget
ticking

^m™8 hp^ith
and

friends

and friends.

This

nf

SUS~

/s

in

This is in

attain all these objectives,

we must have an informed public
whose
be

interest

and

determining

criticism

factors

Continued

on

can

in ; the
page

47

The Commercial and Financial Chronicle
46

(2146)

...

.Thursday, November 14, 1957

■

i

The following

Indications of Current

latest week
week

Business Activity
INSTITUTE:
operations (percent of capacity)

steel

SteeY^o^and

Previous

Month

Year

Week

Ago

Aim

§77.5

*78.0

Nov*

castings (net tons)

17

§1,984,000

•1,996,000

gallons each)
stills—daily average
Gasoline output (bbls.)
Kerosene output (bbls.)

(bbls. °*

fuel oil

output

-Nov.

---—•—■-

terminals, in transit, in pipe linesunfinished gasoline (bbls.) at
Nov.

Stocks at refineries, bulk
Finished

and

(bbls.) at—

Kerosene

Distillate fuel oil (bbls.)

oil (bbls.)

fuel

Residual

~„ov"
Nov.
Nov.

•———

at—:
at

ASSOCIATION OF AMERICAN RAILROADS:
Revenue freight loaded (number of cars)

NEWS-RECORD:

,

(J. S. construction

—Nov.

,—.—

—

Private construction
municipal

and

State

nov.
n°vNov.

.—ill

construction

Public

Federal

(U. S. BUREAU OF

COAL OUTPUT

MINES):

lignite {tons)—
anthracite (tons)
—

coal and

Bituminous

Pennsylvania

AVERAGE

SYSTEM—1947-49

.—Nov.

—

=

—

Nov.

PRICES

Electrolytic

(E.

Nov.

Nov.
Nov.

———Nov.
Nov.

Zinc

at

Louis)

(East St.
tin

York)

(New

BOND PRICES

MOODY'S

Nov.
Nov.
Nov-

at

pig. 99%) at

Aluminum (primary

Straits

Nov.
Nov.
Nov.

at

(delivered)

fZinc

at

corporate

**
II

I

Public Utilities Group
Industrials Group

..Nov. 12

Nov. 12

corporate
:

Aa

-

—

Industrials

Group

Group

received

Production

590,734

592,853

620,045

$147,911,000

$370,736,000

$323,874,000

$281,014,000

77,323,000
70,588,000

223,819,000

150,417,000

146,917,000

173,457,000

168,082,000
112,932,000

58,622.000

124,741,000

120,251,000

97,772,000

11,966,000

22,176,000

53,206,000

15,160,000

9,770.000

9,880,000

9,950,000

10,550,000

393,000

430,000

556,000

504,000

122

127

127

124

11,914,000

11,860,000

11,709,000

11,522,000

266

250

244

219

Unfilled

Commercial

5.567c

5.967c

5.967c

5.622c

$66.42

$66.42

$66.42

$63.04

$33.33

$34.00

$39.33

$59.83

26.200c

26.475c

35.700c

23.400c

22.700c

23.700c

34.825c

13.500c

13.500c

14.000c

16.000c

13.300c

13.300c

13.800c

15.800c

NEW

MERCE

(Millions of

GINEERING

Total U.

construction

Public

and

CONSUMER

short

94.26

94.86

101.64

91.62

91.62

92.06

100.49

88.81

88.81

89.37

98.25

80.93

81.42

82.77

92.79

88.13

96.54

Other

3.86

3.97

4.51

4.51

4.47

3.85

4.38

4.38

4.31

385.0

385.5

358,296

243,205

403,701

292,063

204,159

298,603

388.f

94

97

97

Nov.

481,299

414,615

547,046

Nov.

109.55

109.89

110.13

Nov.

,

Non

AVERAGE

1949

ROUND-LOT

=

TRANSACTIONS

ACCOUNT

FOR

OF

FEDERAL

To

Short sales
Other
Total
Other

...

_

sales

sales

transactions initiated

Total

on

sales

;

sales

transactions

Total

initiated off the

purchases

Short sales

Other
Total

sales

sales

round-lot transactions

Total

for

—

(DEPT.

OF

month

of

Other

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT
LOT

DEALERS

EXCHANGE

Odd-lot

sales

Number
Dollar
Odd-lot

AND

SPECIALISTS

SECURITIES

—

dealers

by

ON

EXCHANGE

Stocks Sept.
Cotton

short

Customers'
Dollar

(customers'

other

total

sales

value

Round-lot sales by dealers—
Number of shares—Total sales.

109.48

U.

—

crop

(DEPT.

1,058,420
185,960

POLICYHOLDERS

22,600

Oct. 19

313,170

390,910

231,380

279,910

Surrender values

Oct. 19

406,270

478,050

263,280

302,510

Policy

676,510

395,600

406,350

Oct. 19

576,645

Oct. 19
Oct. 19
Oct. 19'

116,360

148,240

65,290

79,090

574,937

655,995

367,065

504,230

691,297

804,235

432,355

583,320

2,603,025

3,372,010

1,635,640

1,718,960

ROUND-LOT

FOR

Total

STOCK

AND

Total

Annuity

.

THE N.

Commodity
All

U.

1,066,245

1,044.342

$48,894,082

$57,470,360

782,621
9,074

755,729

S. DEPT.

Oct. 19

1,114,294

1,337,486

773,547

Oct. 19

$49,034,626

$63,011,222

$36,867,319

$37,294,134

209,830

304,730

186,480

205,480

209",830

304,730

186,480

205~480

825,990

837,240

•Revised figure,

other

than

farm

and

food3

;

a

427.1

448,610

dividends

2—,

—

-

—

:

:

:

-—

—

—

(DEPT.

OF

Month of

—

972.060

446,520

379,100

Oct. 19

13,242,310
14,204,060

15,363,520

8,103,190

8,201,770

8,580,870

OF

117.5

117.5

117.6

90.9

91.3

87.9

Nov.

105.1

105.0

102.6

Nov.

90.1

•90.5

91.6

80.8

Nov.

125.6

125.6

125.7

123.6

;

capacity of 133,495,150 tons as
of orders not reported since introduction of

on

new

annual

146

$233,400,000

$203,900,000

55,400.000

54,700.000

49,500,000

9,700,000
44,700.000

9,600,000

46.500,000

41,900,000

105,700,000

107,500,000

9,300,000

87,700,000

99.500,000

84,100.000
89,600,000

$525,300,000

$551,200,000

$478,300,000

$29,120

:

$31,760

*$31,696

—

22.382

*22.397

21,258

$54,142

*$54,033

$a0.3 13

28,571

*29,030

27;588

$31,133,000

$30,933,000

$30,757,000

$2,824,130

$2,862,412

:

—

IN CIRCULATION—TREASURY DEPT.

As

of

Aug.

YORK

30

31

(000's omitted).

STOCK

_

EXCHANGE—As

Credit extended
on

.

margin accounts—

customers', net debit

Total

Sept.

of

(000's omitted)-

Member firms carrying

balances.,

—

customers

to

2

listed shares

Member value of listed

29.749

331,684

837,727

816,374

201,622,023

217,897,831

210,014.923

98,481,183

98,529,855

400,587,883

.

credit balances

free

Total of customers'

bonds

s

Member borrowings on U. S. Govt. issuesMember borrowings on other collateral
ESTATE
OF

FINANCING
U.

S.

—

_

Savings

33,478
327.842
'

866,356

96,190

139,053

84.481

2,192,797

2,164,355

2,228,618

$883,097

S852.032

$920,744

NON-FARM

IN

HOME

$2,815,501

34.955

339,142

^

hand and in banks in U. S._

LOAN

BANK

(000s omitted):.

and loan associations

132,379

129,578

163,466

Bank and trust companies-

378,221

390,108

507,563

Mutual

136,769

141,959

310,316

3*4,968

319,126

367,677

371,916

452,092

Insurance

companies

savings banks
—

institutions

$2,208,459

UNITED

STATES

GROSS

GUARANTEED—(000's
As of Oct. 31

§Based

144
'

SERIES—

NEW

115.4

90.7
104.9

144 !

1

1

Individuals

Nov.

145

146

.

.

COMMERCE)

Durables

481,950

961,750

144

$222,100.01)0

-

Oct. 19

8,549,710

,

August (millions of dollars):

Nondurables

AREAS

16,335,580

'422.0

LIFE

OF

:—

Market value of

tlIncludes 905,000 barrels of foreign crude runs,
tNumber
of Jan. 1, 1957, as against Jan. 1, 1956 basis of 128,363,090 ons.
Monthly Investment Plan, tPrime Western Zinc sold on delivered basis at centers where freight from East St.- Louis exceeds


http://fraser.stlouisfed.org/
one-half cent
pound.
Federal Reserve Bank of St. Louis

.418.4

c

.

August:

Total

REAL

Nov.

j

commodities

payments

Cash

Group—

Meats

i.0,678.000

TO

:.

Miscellaneous lending

foods

il8.7B0,000

8,368,000

Sept.-:

...

Inventories—

6,587

(1947-49=100):

products

Processed

of

.

BOARD—Month of August

commodities

Farm

All

—

21.688.000

18,079,000

8,441.000

Total

749,142

Oct. 19

PRICES, NEW SERIES

—

1,972,780

STOCK TRANSACTIONS

^

21,192.000

18,147,000

GOV-'

PAYMENTS

1

(SHARES):

sales

LABOR

287,650
1,685 130

1,802.785

STOCK

Y.

21,161,000

MANUFACTURERS' INVENTORIES AND SALES

sales—

sales

WHOLESALE

336,020

1,466,765

3,363,905

32,680

Oct. 19

Short sales

Other

benefits

Disability-payments

,

ON

-

Sales

Oct. 19

SALES

ROUND-LOT

ACCOUNT OF MEMBERS

round-lot

603,680

2,760,225

2,975,917

1,370,166

13.309,827

12,401,000

of

INSTITUTE

—

INSURANCE—Month
Death

MONEY

Oct. 19

EXCHANGE

623,820

2,352,097

30,134

•871,671

13,780,000

•

1:

1—..._i_

*.l~.

INSURANCE—BENEFIT

LIFE

31,900

1,144,528

129,526

724,454

18,079.000

OF

_i

87,140

Oct. 19

9896,125
14,336,503

104,455

100,170

Oct.

—

93,100

Oct. 19

825,303

993,041

RESERVE-

FEDERAL

THE

OF

323,270

;

666,549
9.326.845

COMMERCE):'

OF

•SYSTEM—1947-49=10(>—Month

Oct. 19

1,857,790

5,523,648

490,515

Oct. 19

$80,770,972

2,226

711,503

Active,.spindle hours, (000's omitted) Sept. 28 ~
Active spindle hours per spindle in place Sept. -.

254,190

1,791,226

3,780

2,320

1,079,895

Spinning, spindles in place on Sept.. 28
Spinning spindles active on Sept. 28—

193,650

$73,447,547

3,361

3,910

2,310

18,147,000

;

SPINNING

3,606

3,898

9,651,766;
—

of

485,270

Oct. 19

TOTAL

9,367

—

DEPT.

900.990

Other

Round-lot purchases by dealers—
Number of shares

9,836

659,651

28.

as

1,086,950

Short sales

sales

6,919

9,852

of Sept. 28

as

PRODUCTION

COTTON

282,327

sales)—

sales

7,876

of Sept, 28—

as

S.

NEW

sales

1,758

7.913

-v..

COM¬

OF

—

•AGRICULTURE—1957

868,320

Get. 19
Oct. 19

orders—Customers'

of

Customers'

1,846

COMMERCE)—

Production 500-lb. gross bales—

(customers' purchases)—t

purchases by dealers

Number

7.497

1,860

month of September

28.

spindles active

COTTON

OF ODD-

shares

of

7.868

2,498,552

of Sept.

as

Linters—Consumed

372,488

N. Y. STOCK
COMMISSION:

value

14,533

7,867

BALES:

public storage

1,107,150

Oct. 19
Oct. 19
Oct. 19

2

sales

sales

30,707

15.455

September.——

In

1,713,320

of members—

$40,074

33,045

15,519

„.

DEPT.

—

consuming establishment

2,081,620

°ct-19

Short sales

Total

account

purchases

$42,881

33,159

3,644

—

MERCE—RUNNING

-

Total

$43,011

RE¬

credit

term

loans

In

1,463,990

floor—

129,253

—

Matured endowments

purchases

Total
Other

238,830

368,300

76,459

-

LINTF.RS

AND

1,878,350

the floor—

Short sales
Other

19

Oct. 19
Oct.. 19
Oct. 19

607,499

129,886

(running bales)

l

Conftnned

BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:

1,046,390

526,609

—

GINNING

Oct.

Unadjusted
2,210,230

736,752

703,356

—

—

Seasonally adjusted'.;

1,703,110
414,360

.1,141,589

603,06S

•

payment

COTTON

MEM¬

specialists in stocks in which registered—
Total purchases
Oct.

$1,878,341

644,028

833,242

SERIES—Esti¬

INDUSTRIAL PRODUCTION—BOARD OF

Transactions of

$11,247,09G

866.630

goods

consumer

ERNORS

100

$1,699,872

instalment credit

COTTON

3.78
423.0

^

"

OIL, PAINT AND DRUG REPORTER PRICE INDEX—

$86,600

,

Personal loans

3.86

4.22

*$91,000

Repairs and modernization loans.

3.25

4.55

$91,200

<

_

94.12

4.96

12,500

23,700

of

i_—

accounts

4.46

12,700
24,100

'

Automobile

credit

4.61

$50,400

fJ2'

30:

credit—

Service

5.07

$54,100

24,200

I

THE

OF

of Sept.

as

Charge

4.50

$54,100

:>

"12,800

——

credit

98.25

4.64

Nov.

-

millions

Instalment

90.83

5.11

(tons) at end of period

in

Total consumer

89.64

4.50

\ $39,313,000

'

—

intermediate

antl

86.67

Nov. 12

$43,514,000

AUgUSt

Month

—

i—T.

SYSTEM—REVISED

88.81

3.65

2,058,000

$45,420,000

OUTSTANDING—BOARD

CREDIT

GOVERNORS

86.88

3.72

7,840,000l;

10,426,000

2,331,000

—___.2i_—2—i_—

88.67

4.08

15,656,000

14,752,000

•,.»

'

.

87.63

4.27

Of

municipal.

112.125c

4.44

4,220,000

.

COM-

%

_

construction

92.625c

4.12

Month

omitted):

91.000c

4.50

OF

construction.

89.500c

4.51

•DEPT.

NEWS-RECORD

(000's

S.

25.000c

3.68

932 ;

$9,539,000*•? -

3,158.000

4,554,000

i__

26.000c

3.65

1

CONSTRUCTION—EN¬

ENGINEERING

26.000c

99.52

■

Total

26.000c

98.41

-

5,618,000.-

Retail

13.500c

91.48

13,653.000

—_

—

Wholesale

10.000c

89.23

1,145

—_—_

10.000c

90.48

91

$12,847,000

j

SERIES

10.000c

88.67

94

dollars):

Manufacturing

10.500c

90.48

146

7,690,000.'

_

INVENTORIES

BUSINESS

10.500c

88.67

165

ni

10.500C

87.32

164

1,071

liabilities—

14.000c

86.91

85
489

$13,901,000

liabilities——.

Total

OF

26.175c

97
588

i—

liabilities
service

140

96

535

i—-——-——

———„——

Retail liabilities —L

State

4.30

Nov.

activity

orders

liabilities

Wholesale

Private

4.13

Nov. 12

INDEX

(tons)

(tons)

Percentage of

800,367

662,299

NATIONAL PAPERBOARD ASSOCIATION:
Orders

747,647

3.58

204

——,.——

liabilities

Manufacturers'

Construction

703,688

182

—~

—.—-

Total number

35,235,000

4.30

—Nov. 12
12
Nov.
12
Nov.

-

COMMODITY

MOODY'S

58,103,000

$167,154,000

——

Commercial service number.—

158,685,000

Nov. 12
Nov. 12
Nov. 12

'

Railroad Group
Public Utilities

59,465,000

'

Aaa

A

48,071,000

•175,469,000

59,343,000

$190,529,000

———A————

Construction number

Single

YIELD DAILY AVERAGES:

Baa

35,486,000

NovNov. 12
—Nov. 12

—

U. 8. Government Bonds

Average

34,264,000

Nov. 12

.

Railroad Group

MOODY'S BOND

7,835,000
172,626,000

12
12
12
12
Nov. 12

Aft
Baa

7,659,000

Nov.
Nov.
-Nov.
Nov.

.

Aaa

A

6,981,000

179,288,000

DAILY AVERAGES:

U. S. Government Bonds

Average

7,354,000

174,772,000

$189,297,000

number

number

number

Retail

2,507,000

mated

copper—

Louis)

12,305,000

12,477,000

Wholesale

SERVE

Export refinery at
Lead (New York) at
(St.

26,620,000

177,383,000
35,775,000
171,291,000

Ago

..

of September:

Manufacturing

QUOTATIONS):

J.

Domestic refinery at—

Lead

27,793,000
1,651.000

181,410,000

,

PRICES:

M.

&

12,126,000

INC.—Month

6,981,100
7,853,000

'•Federal '

Pig iron (per gross ton)
Scrap steel (per gross ton)—
METAL

2,007,000

DUN &

(per lb.)

steel

27,350,000

1,902,000

Year

Month
.

BRADSTREET,

FAILURES—DI N &

October

Nov.

.

INDUSTRIAL)

(COMMERCIAL AND
BRAD,STREET, INC.

FAILURES

Finished

27,024,000

Nov.

100

INSTITUTE:
Electric output (in 000 kwh.)

IRON AGE COMPOSITE

7,779,000

Previous

OF

(in thousands)

September

CIVIL

ELECTRIC

EDISON

6,811,550

7,649,000

INDEX—FEDERAL RESERVE

STORE SALES

DEPARTMENT

Nov.

——

6,765.675

713,994

-—Nov.
Revenue freight received from connections (no. of cars)—Nov.
CIVIL ENGINEERING CONSTRUCTION — ENGINEERING
Total

6,711,570
J! 7,580,000

12,077,000

—r^ov-

(bbls.)——
(bbls.)
-

fuel oil output

Distillate

Nov.
Nov.

(bbls.)

'

of that dater *

FEDERAL RESERVE SYSTEM—Month

BUSINESS

42

Residual

of

2,466,000

GOVERNORS

either for the

are

are as

Latest

AMERICAN

Crude runs to

of quotations,

cases

OF

DEBITS—BOARD

BANK

THE

2,070,000

in

or,

Month

100.2

80.9

that date,

on

production and other figures for thfi /

cover

Dates shown in first column

month available.

Week

Nov. 17

PETROLEUM INSTITUTE:
Crude oil and condensate output—daily average

or

month ended

Latest

AMERICAN IRON AND STEEL
Indicated

or

statistical tabulations

General funds balances
Net

debt.

Computed

annual

rate.

DEBT

-

$2,210,561

181,326

.

$2,544,317

DIRECT AND

omitted):

$275,372,172

$274,170,055
4,306,587

$274,526,547
7,334,772

4.704,070

$269,863,468
2.891%

$767,19i;775

$270,668,102

2.876 %

2.630%

Volume 186

Number 5690

The Commercial and Financial Chronicle

...

(2147)

47

(•
Continued

from

45

page

With Johnson & Geisler

■■

POMPANO

The

U. S.
struggles
dom

criticize

is

The

free¬

basic

is

It

face up to
Cold War.

be

constructive

destructive.

"

with

agree

Where

their

and

we

not

or

ac¬

policies

minds, Soviet

successes

due

the

to

Kremlin

the

same

views

time,

Government
load

of

we

to

must help

reasonable

than

West.

We

of

*

The

patriotism "of

people,

our

the ingenuity of our scientists and

engineers, the skill of our labor,
the efficiency and productive ca¬
pacity of our industrial plants,
and the dedicated

the

can

lethargy of

still

turn

other branches of

Boettcher

power

the

as

lead¬

ing nation in the world.
But

is

physical

not

itself,

by

power,

enough.

:'

It must be

ing.

and- human

They

that

the

moving
in

be

must

ideas

R, Colo.

and

Seventeenth

accom¬

This

has

been

any

in

true,

varying degrees, throughout his¬
tory. Today that truth is all-im¬
portant.

^

*

COLE

the

Board

906

of

Stock,
1957

payable

December

stockholders of

to

16,

record

December 5, 1957.

is

DREWRYS
<

/

..

A

else and
lie.

Secretary

Harry W.

—

of 1957 has been declared

Company,

Street,

mon

828

members

quarterly

on

the

share

indications

ness

on

one

of

corner

prosperous,

Robert P.

—

Lowther and Charles C.
are

now

you

are

with

Phythian

First International

141st

DIVIDEND
The

Two With R. D. Standish
t

following dividends have been
by the Board of Directors:
Stock—A

Preferred

(Special to The Financial Chronicle)

regular quarterly

dividend of $ 1.0625 per share

BOULDER.

Colo.

H

on

the

per

the

the

on

1957

to

the

18, 1957.

have become affiliated with R. D.

Standish

Investments,

close of

business

of

record

November

on

of $0.25 per

quarterly dividend
on the Common

November

various

payable January 10, 1958 to stock¬
19,

1957.

DIVIDEND

The directors also declared regu¬

dividends of $1.18%
the $4.75 Sinking Fund Pre¬

ferred Stock and $1.25 on the $5.00

of business

Sinking Fund Preferred Stock, both
able January 10, 1958 to stocklers of record Dec. 19, 1957.

on

December 9,

1957.

IBM

STOCK

EDWARD L. JOHNSON

October 24,1957

DIVIDEND

Secretary

CORPORATION

share

on

the

stock of this

common

Corporation

has been declared
December
Eisenhower

14,

payable

1957, to

The

Board

quarterly cash divi¬

dend of $.60 per

A dividend of $1.00 per

<§>

Corporation has today
a

December

declared

share, pay¬
10,

DODGE

PHELPS

Board of Directors of

chines

1957, to

dend

oj Directors has

fourth-quarter divi¬

a

of Seventy-five Cents (754)

stockholders of record at the
close of business on November

per

share

13, 1957. The Board of Direc¬

of

this

tors also declared a 2 V2 % stock

on

the capital stock

payable

Corporation,

December

10,

1957

to

stock¬

dividend, payable January 28,
holders of record

1958, to stockholders of record
on

January 6, 1958.

1957,

C. V. BOULTON,

stockholders of record at

in

November 19,

total

dividends

1957 of

three dol¬

making

declared

Treasurer

close of business Novem¬
ber

goes.

lars ($3.00) per
590 Madison Avenue

29, 1957.
Fee,

October 29, 1957

IBM

BUSINESS MACHINES
COBPOBATION

MFG. CO.

further should the

DIVIDEND

RICHFIELD

No. 134

A

regular quarterly dividend of fifty
cents (50c) per share on the issued and
outstanding common stock, $10 par
value, of this Company has been de¬
clared payable December 23, 1957 to
at

the close of

business November 27, 1957.

busy corporations

and organizations executives
Frankly, we cater to the individualist
the person who wishes to
give distinctive Christmas gifts that will he remembered long after
the holidays season is over. Florence Pearl Associates with direct
.

backlog of experience in gift baying, will purchase
this type of gift for you
to suit your personal requirements
within your budget. Samples submitted. Call MTJrray Hill 5-5913 or
write cto Box C116, Commercial & Financial Chronicle, 25 Park
a

.

November 6,1957

vfo ALIIS-CHALMERS
COMMON

»

4.08% PREFERRED DIVIDEND No. 14
A

regular

quarterly dividend of one
dollar and two cents ($1.02) per share
on the 4.08% Cumulative Convertible
Preferred Stock, $100 par value, of
this Company has been declared, pay¬

dividend notice
The Board of Directors, at

a meeting held November 7,
regular quarterly dividend of seventyfive cents per share for the fourth quarter of the calendar

1957, declared

year
on

1957 and

a

special dividend of fifty cents per share
Corporation, both payable December 14,

a

stock of this

1957, to stockholders of record at the close of business
November 18, 1957.

Norman F. Simmonds, Secretary

able December 5, 1957 to shareholders
of

record

at

the

close

of

business

November 22, 1957.
Transfer books will not be closed.

RICHFIELD Oil Corporation
Executive Offices

Checks will be mailed.

>

555 South Flower Street,

.

W. E. Hawkinson,
Vice President and

November 6, 1957

Los

Secretary

value

Treasurer.

INTEBNATIONAL

November 7, 1957

par

M.W.URQUIIART,

Vice President and Secretary

But the President

.

$12.50

share.

New York 22, N. Y.

AN UNUSUAL CHRISTMAS GIFT SERVICE

Place, New York 7.



of record Dec.

PREFERRED STOCK

on

shareholders of record

...

declared

Common Stock,

QUARTERLY DIVIDEND

and see
to—what is the best thing

.

on

stockholders of record at the close

Common Dividend No. 152

.

share

171st CONSECUTIVE

of one
another

for

a

Stock, payable January 1, 1958 to

declared

philosophy of the Employment Act require it.

and

cents

International Business Ma¬

Administration would go much

contacts

The Board of Directors of Sea¬

6, 1957

occasions has let it be known that his

...

DIVIDEND

Quarterly Payment

lar quarterly

J. W. Reilly, Secretary

side.

it

STOCK

regular quarterly dividend of 25

a

Secretary

share

The

Pres.

COMPANY

board Finance Company

holders

GEORGE SELLERS,

Common Stock—A

at

December

9, 1957.

Wal¬

1227

on

of

December 2,

on

stockholders

$4.25 Cumulative Preferred Stock
the close of business

Common Stock

Company, payable

payable to stockholders of record at

g

Board decides to do, plus the rate of Federal
spending and the taxation policies., and so on."—
President Dwight D. Eisenhower.

on

1957.

91st Consecutive

share

Hitchcock and John W. Weinhardt

u

of the

as

1957.

a

regular quarterly dividend of 60c

h B.

—

a

per

1957

Dividend

Common

The Board of Directors has declared

declared

•

C. Allan

far

6,

COMMON

NOTICE

serve

so

15,

FINAN^L

"And government generally speaking in the fi¬
nancial world, is confined to what the Federal Re¬

enough

cents

DAYTON, OHIO

government can do.

Good

declared

13,

SERBORRD

AND LIGHT COMPANY

Corporation, Denham Building.

another isn't. So all you can do
is to get the very finest brains
you can

has

fifty-five

THE DAYTON POWER

(Special to The Financial Chronicle)

DENVER, Colo.

isn't. One class is prosperous,

together that
exactly what

of

December

South Bend, Indiana

this, I point out, is *
again indicative of our kind of

One

on

November

on

November

Orewrys Limited lh S. A. Inc.

"And

economy.
section is

dividend

payable

D.H.ALEXANDER,
Secretary

able
are

Manufacturing

Directors

to

stockholders of record at the close of busi¬

com¬

stock, payable December 10,1957

Exchange.

nut Street.

all

of

stockholders of record at the close
of business on November
22, 1957.

do

not

Board

to

Appraisal, Anyhow

is

Dis¬

Company
The

some

or

Dividend

Frederick D. Strong, Secretary

The Singer

dividend of forty (40)
share for the fourth quarter

anything
get it out to the pub-,

So there

Checks will be mailed by the Old Colony
Trust Company of Boston,
bursing Agent.

by The
Bank, Divi¬
Disbursing Agent.

quarterly

cents per

day I have complaints brought
to my office why don't I
print
money

of record at the close of business November

8, 1957.

November 12, 1957

disappointment I think in the
seasonal upsurge of fall
buying. There is some in¬
creased unemployment.
"On the other hand, the demand for
money is
just as great as ever, and every

some

regular quarterly dividend of Seventy(7oO per share has been declared
payable November 15, 1957, to sl ock holders

Manhattan

Transfer books will not be closed.

"There

NOTICE

A

five Cents

Checks will be mailed

Chase

Checks will be mailed.

A Calm

DIVIDEND

per

Secretary and Treasurer

emotions

determining the outcome of

conflict.

of

No.

Boston, October g5, 1957

Join First International

become vital factors

men

per

payable

cents

COMPANY

ITabpic"

T. E. JEANNERET,

employed

and' the

20c

($.40)

share and
year end dividend
of forty cents ($.40)
per share
of
$12.50
par
value
Capital

dend

understand¬
so

declared

of

can

panied by spiritual faith, political
wisdom

has

Stock,

SYLVAN

against
we

Directors

Common

29,

Dividend

has

JOHN W. HAMILTON,

the New York Stock

Govern¬

our

the

Chairman

Lloyd, Jr. has joined the staff of

make it possible for us to
accomplish all these tasks and to
our

•

Boettcher Adds

D E N V E

ment,

maintain

the

(Special to The Financial Chronicle)

:

serving in the Armed Forces and
in

of

quarterly dividend

Directors

additional

an

1957 to stockholders of
record
November
20,
1957,
Transfer
books will not be closed.

and women

men

on

65

of

'

"

>•)

\

Board

regular

share

declared

forty

INC.

NO.

Board

PEPPERELL
MANUFACTURING

Dividend No. 906

genuine strength.

for

requests

-

The

the

November

to

DELAWARE,

[p&pptRtyj

MINING COMPANY

our

appropriations that may be neces¬
sary to increase our Natinal Se¬

curity.

1

NOTICES

DIVIDEND

DIVIDEND NOTICES

HOMESTAKE

2631

lead not from weakness but from

its heavy
We should

carry

responsibility.

support

them. At

upon

OF

have been

genius

tions, we may criticize our re¬ Kremlin's own weapons
sponsible officials in Government World Communism—and
and urge our

Geisler,

NATIONAL SHIRT SHOPS

a

less

the

affiliated

now

and

OIVIDEND

In the battle for men's

not

do

Voss is

Atlantic Boulevard.

late, but not too late, to
the imperatives of the

and

a

L.

Johnson

DIVIDEND NOTICES

Fla.—

The

right of American De¬
mocracy. But criticism, especially
in
the
perilous times we face,

precious

should

with

Strategy and Policy

confront.

we

to

Bernard

Importance oi Allies to

BEACH,

Angeles 17, California

The Commercial and Financial Chronicle

...

Thursday, November 14, 1957

(2148 J

1?>

BUSINESS BUZZ
on...
BeVimJ-the-Scene Interpretation#
from the Nation's

WASHINGTON, D. C.

be

one

the

Virginia, appears
of the busiest spots.

that

time there is

a

each

government.
Washington
to be undergoing a truly

recommendations
.

awakening because of the

rude

great

Russian

-dramatic

and

country are

various parts of the

being summoned to the Capital
for consultations.
In President
Eisenhower's first of a series of

the

of

ahead

is

States

United

that

said

he

speeches,

our

competitor in the nu¬
field.
This
belief ap¬

foremost
clear

by

parently
is shared
qualified people.

most

States
dollars
I work

is

It is

apparent this coun¬

now

is in

try

headlong race with

a

Russia in various fields of

Red

much

So

endeavor.

so

that

people in unofficial posi¬
in Washington are talk¬

some

tions

ing about "if and when we get
into another war."
If there is

nuclear weapons
all. certainly it would not
a
drawn out conflict like^

all-out
and
be

war,

II

War

World

Korean

the

or

War.
No

knows

one

long

how

World War III would last. How

at

ever,

the

meeting

person

representing

whole of free

enterprise in

sponsible
the

¬

private
luncheon
other day a re¬

a

this

made

country,

his

in

observation

provoking

Said he, "World War

remarks.

HI could be

in

over

but

weeks,

three

thought-

a

week, or

a

stands

it

to

too

could not

horrible

Scientists

to

longer

last

It really is

three months.

contemplate."

that

the
role of scientists and electronic
is

It

obvtous

now

engineers has increased in im¬
night.

and
stature
over;-;
Some of the best elec-;

tronic

brains

portance

ton

future

is

role

mendous.
.

the

country

being; called to Washing¬
for
consultations.
Their;

are

.

in

The

going to be tre¬

..

...

House "'is'

White

defi-;

xiitely alarmed at the scientific:
shortage. Dr. Howard L. Bevis.
Chairman
of the
President's
committee

scientists and

on

en¬

gineers. predicts there will be
a
continued shortage for
an¬
other six
Dozens

or

eight

of

Congressmen

has

Russia.

Red

from

been another

Despite

are

This

big traveling

for members of Congress.
Most of them always return be¬
the

three

Thanksgiving.
New

Year,

so

major holidays.

Christmas
they

turkey, dressing
pie at home.
JEllender

the

can

and

and
have

pumpkin

Allen

States

is

Senator

J. .Kllender. of Louisiana.

Perhaps no one on Capitol Hill

»wouldfdispute the fact that he
travels

than any member.
on
the trips, as a

more

Digitized forHe
FRASER
w6rks
http://fraser.stlouisfed.org/
linefiffzi pf the Senate Appro¬
Federal Reserve Bank of St. Louis
■

ment

is

are

now-

electrified.

REA

1,400,000 miles of line in 45
Puerto Rico and

Coopera-

received
and

1

Administration, along,with
of Defense
shoulders the responsibility for
the
foreign aid
programs
and for they actual
conduct of mutual security pro¬

coordinating

p]e.

State

Department, it is
organized on a regional basis
With Supporting technical and
management staffs.
The four
regional offices are Africa and
Europe: Latin America; Near
East and South Asia; and Far
East.
"*-».■*
!
which TCA either
coordinates
em¬
braces these major categories:
military assistance, defense
support, technical cooperation,
development assistance, mutual
defense

nical

has

control

.

says

the

directive

important

is

clear the

in

the Army

to

the

to

<

and

groups,

are

forces

in

anced

free

r

in

cooperation, this
sharing 1 its

overseas

projects"

for¬

eign aid funds.

known

setting

as

be

ICA

spent.

issued

A

few

is

Carl Marks

&

States.

forth
The

the- asserted
directive

eco¬

declared

D._ Lascoe

Society

of Tool En¬

gineers, 10700 Puritan, Detroit
38, Mich., $4 to members; $6 to
non-members.

Vitamins

and

Health

lets,

22

York

East

—

William

Affairs

Pamph¬
Street, New

38th

16, N. Y.—paper—25c.

TRADING MARKETS

Campbell Co. Com,
!

i

FOREIGN

Co. Inc.

SECURITIES SPECIALISTS

Riverside Cement

Flagg Utica

'
..

,

20 BROAD STREET

TEL: HANOVER 2-0050

•

NEW YORX 5, N. Y.
TELETYPE NY 1-971

'

LERNER ft GO.
Investment

"Policy Directive 9." "■

nomic philosophy of the United

4

Test

Orville

National Co.

been

what

—

111.—paper).

Shrinkage

Morgan Engineering

countries to
assist
development

to

Method

-

United States Envelope:

,

ago

Tooling

Indian Head Mills

<

spent and additional huge sums

likely

Street, Chicago 32,

Fashion Park

j

raise their standard of liv¬

weeks

Topo-Diagnostic
Luscher—Trans¬

by

Botany Mills

ing.

are

Mod¬

Its

and

A. S.

country
knowl¬

already

for Intensity

Rubin—Public

indus¬
with

Book

116

Efficiency—E.

American

enterprise economy.

economic

have

..,

aiding our military
a
bal¬

and

Billions

.

[This column is intended to re¬

trialization

Limen

Plastic

flect the "behind the scene" inter¬
pretation from the nation's Capital
and may or may not coincide .with
the "Chronicle's" own views.]

undertaking

and

Gale Re¬

establishing

and

edge,. experience, > techniques
skills with peoples of less

in

so¬

of

Club

—

Beltone Institute for
Hearing Research, 2900 W. 36th

cialization most confining when

atmosphere

of

Houses

Company,

lation

the

corporate

Directory

ulation of Pure Tones, Its Val¬

permitted

dividually

42nd Street,
N. Y. (cloth).

Our Determination of the Differ¬

idity

enterprise

economy

Action

Century

West

Plan

search

Okinawa has em¬

its

Twentieth

Tower, Detroit, Mich.—$15.

said,

Under tech¬

been

Party

under occupa¬
tion by U. S. military forces.
He added that Okinawians, in¬

-

1

develop

limit

atmosphere.-. He said

the past engineers have

he

330

National

helping this Far Eastern Island

particu¬

"found

on

hand,

private

phasized

helping "to

that in

other

the

—

York 36,

New

.

On

_

larly

Fund,

ownership and opera¬

tion.

supple¬

in

Aid

American

1947-1956

ence

A Wash¬

with

compilation

ments, 95.-Swiss francs).

manufacturing

scale

ernment

/

.

Many millions of

Set-

Switzerland—

Basle,

15.-Swiss francs (complete orig¬

plants, all under Korean Gov¬

voicing endorse¬

; ; *

He cited Korea as

example.

supplement

International

for

tlements,

seeking greater

countries

large

favorable.

been

*

American dollars have gone into

Mr. Burrus, Illinois-born aud

or

assistance

commendation

Alabama and Georgia educated,

Programs

special programs.

are

,

to

United States

the

ican dollars.
an

rective is receiving, commenda¬
tion among the technical peo-

A semi-autonomus unit

of- the

has

Engineers

Exchange Regulations in

enterprise philos¬

free

of

occasion

on

Great Britain—14th

industrialization through Amer¬

criticism, but most of the

comment

Book

Greece:

Received

both

150th

—Bank

point out and empha¬

to

the

size

en¬

ington consulting engineer, who
keeps his fingers on the en¬
gineering pulse, said at a small
private luncheon that the dif

Department

grams.

to

spokesman said a few

ment of the directive.

tive

the

Well

of

bank

inal

failed

days ago that the directive has

consumers

International

exceptions

be

He
past

have

Government

American

course

ophy

An ICA

the Virgin Islands.

.

Of

Kansas

Shop, Wilmington, Del.

representatives of the

the

that

City,

mortar

also maintained that in the

indus¬

owned

private capi¬

factory, mill or plant.

a

Kansas

anniversary—Greenwood

of

Foreign
of

enterprise

publicly owned foreign

Directive

states, Alaska,

The

publicly

of

aware—Commemorative history

under¬

to

tal behind the brick and

develop¬

the

fail

stand the need for

the

some

of the Nation's

4,945,000

of

terprises.

Department of Agriculture,

serving

District—Federal Reserve

Farmers Bank of the State of Del¬

directing the ex¬

funds

sistance

and not be prepared to

would

there
the

in

private

enterprises.

trial

year ago.

aid

the

economy

The Rural Electrification Ad¬

farms

to

of

finance

policy

the

be

agency

about

population is now listed
compared with 57,-

that 95%

Agricul¬

Commercial

of

City, Mo.—Paper.

penditure of United States as¬

Thus, ICA said it

growth.

shall

ministration, lending agency of

and

eled member of the Congress of

United

ital

at 60.677,000

says

Loans

Bank

representa¬

foreign

tives who are

increased employment and cap¬

$20,396,000 fewer than a year
ago.
On the other hand, the

the

A study of

Farm Loans:

that

declared

engineer

often

too

prices,

lower

control,

quality

The

means

research,

management,

better

living in communities of fewer
than
2,500
are
classified as
rural.
The new estimates place

a

Insti¬

quest.

page!"

serve

ownership

private

that

Population Growing

985,000

United

Banks in the Tenth Federal Re¬

Although the farm popula¬
tion is declining, the rural pop¬
ulation is increasing.
Persons

rural

presume,

tural

shrinking. On the other hand,
chain
department
stores
are
providing more outlets and are
expanding generally.

their

"Champ"

Sir, you'll be kind enough to tell me when

you're through?—I'm rather anxious to turn the

at

—

tute, 488 Madison Avenue, New
York 22, N. Y. (paper), on re¬

population

population

the

in

States—Health Insurance

and
prosperity, the
independent depart¬
stores in this country is

farm

Press,

cloth

—

.

Coverage

ance

"I

the

Alfred

Extent of Voluntary Health Insur-

number of

Rural

Manage—

Maritime

•

.

indefati¬
colleagues

growth

developed

Without doubt the most trav¬

the

the

Traffic

Forwarding

Cambridge, Maryland
$7.75.
'
'
:

agree

year

fore

the

and

'

with his statements
about his traveling.
will

operates

years.

returning home from abroad,"
some

of

16, N.Y. (paper), 25c.

Murr—Cornell

Stresses Free Enterprise

Pedestal

on

most

Louisianan's

gable

on

it

reason

than

ment

.

junketeering on my trips."

no

Perhaps

ment

Headlong Race with Russia

New York

Export/Import

United
Government millions of
as a result of these trips.
when I go abroad. There
the

saved

have

Affairs

^Pamphlets, 22 East 38th Street,

priations Committee.
"I

27, N. Y.

James F. Crow—Public

usually

are

Fall
Univer¬

Columbia

—

I

...

Effects of Radiation and Fallout—

approved by the Senate Appro¬

ecientific achievements.
Scientists and engineers from

York

of his

Most

cuts.

.

.

Press

sity Press, 2960 Broadway, New

he makes a series of rec¬
ommendations
suggesting
ap¬
trip

propriation

University

Catalogue

II.

War

History.— Rand

Chicago 80, 111., $6.951;
Columbia

since the end of
Following each

year

World

World

of

McNally & Co., P. O. Box 7600,

long
abroad

trips

flying

strenuous

urgency" at the Department of
other departments of
the

Atlas

near

He has been taking

East.

State and

seems

countries

Street, New York 18, N.Y.

paper.

and

three /Weeks
of the

for

all

then

1

39th

back

Russia

»

At
the
"sense of

corridors.

of

he

from a flying trip
started Sept. 1.
He visited

across

Engineers—1957—American So¬

embassy and

just

There seems to be a quick¬
both among the mil¬
itary'and civilians along the 27
miles

ciety of Civil Engineers, 33 West

the

country

ened pace

same

tion of American Society of Civil

consulate in
visits.
He is

of

each

in

Potomac

Annual Report of Board of Direc¬

Committee,

Committee.

the

building,

office

to

even

and

Senate Agri¬
He visits

priations
Chairman
culture

adjournment.
the World's larg¬

The Pentagon,

*

The

Congress in

with

est

days,

autumn

late

these

—

And You

CapiUl

busy place

Nation's Capital is a

LOCAL

Securities

10 Post Office Squirt,
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