The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
NOV 2 2 1946
BRARY
'
ESTABLISHED 1839
Final Edition
New
Number 4544
.Volume 164
--The Effects
By PAUL EINZIG
•
for
Secretary
election results as
indicating there will be no substan¬
mmitment
under
^
Loan Pact
to
return
to
being confined to 70% of prewar.
policy holds both reduction of trade barriers and internationally-induced full employment are mutually indispensable for
eral trade and
and
H
-
ahead ;
,
dollars.
will
spare
concerning
today
of
1
in
all-out
this fact.
effort Britain had, in
war
INDEX
index of
of
Then,
of shipping. We lowered the
standard of living of our people
nage
contents
see
page
2603
3>to surpass
the
capacity
of
producti on,r;
all
mobilized
and
man
our
and
and industrial plant,
for the prosecution of the war. In
addition to all this, as a result of
vast military
' i
-
re¬
established by
rise-in;,
a
pledges honest administration free of vindictiveness, and
application of law. Discloses Commission proposals for
of changes making for simplification of pros¬
While
with
"sensible"
prices.
people
series
fixed incomes
as
pectus requirements, to
abbreviated.
:
concerns
for
must reduce
no
bill
brief.
by Mr. Caffrey before the
City, Nov. 18, 1946.
'
.
their consumption, en-
no
longer maintained
of
phases, the
cost
between
1
J.
tional
Caffrey
margin of
The increasing difference
the price and the cost
creates in
James
at the level
plus a normal
profits.
come
address
♦An
New York
Largentaye
petition among them is lessened
and the price of commodities is
markets
office.
de
.
trepeneurs on the contrary profit
from favorable conditions.
Com¬
health and safety
the
J.
di¬
and
minish
and gone, but
of the
goes on forever.
I am not running for
I have no campaign oratory to make and
of goods to sell. • For that reason I can be
But for that reason too, I will be serious.
The recent elections have
the
class
their real
see
ity and safety of the great market places in which
the American investor trades.
The market is a
our
as
incomes
concern—it is with the vital¬
dynamic thing, it goes through broad
nature of its problems changes. \ *
well
salaried
'
We have a mutual
expenditure overseas
H/ (Continued on page
then
.
is
ments
SEC chairman
•
Vacuum Concrete
h
c
these two ele-
Commission
womanpower,
:/
balance"
h i
exists between
By JAMES J. CAFFREY*
Chairman, Securities and Exchange
•
necessarily
Will Be Relaxed
place, to sell a large pro¬
her overseas invest¬
with the introduc¬
tion of Lend Lease by the U. S. A.
and Mutual Aid from Canada, we
reduced our export trade to under
one-third of its pre-war volume.
The war cost us over half our ton¬
portion
ments.
For detailed
must
accompanied
When the effective demand tends
increase of business profits:
lessen registrants' burdens
speed up processing of registration statements.
The Effects
Of War
'j Tentative plans call for complete scrapping of some
To
sustain forms, and revision of others. Underwriting con¬
six years of tract details and remuneration disclosure to be
Marquand
H. A.
the first
(Continued on page 2647)
;
;
theory teaches that inflation is
and
ing recent weeks there have been
indications that official circles
social, political, and economic j
on
the
very
take account
non-dis-
\ crimination in foreign trade. Dur¬
a
great deal, and
her foreign
trade policy
dertaken in the Washington Loan
Agreement,
an
making profits
lesser evil than deflation which allegedly is chronic
w
Great
Britain
.
of the
Britain the
trouble and indignity of wrig¬
gling out of the commitments un¬
v
as
war.
ally the war
,
it
that
of
cost
victory
Congressional elections Ts
the
at
Decries inflation
Liberal economic
by
concerns now are
4-
Yet economic¬
results of the Republican
.
Reports French
and not self-correcting.
1
States
been favorable to business.
nevertheless suffered losses from inflation during
to.
times
drive brings
ENG. —One
LONDON,
the difficulties
Fund
Monetary
probably be benefited by inflation if this one is gradually j
grounds, but
f
International
the/ troubled
Says
few
?
back
the
to
hark
present export
Paul Einzig
we
-—
loathe
are
privileges
Sterling
Area.
!
problems maybe,' but also to the opportunities which lie
the
abandon trad¬
in
look towards the building of the peace—to
we
r
ing
and will
reduced. ; ^
government controls, imports are
As
concerns
World War II.
h
generally raised living standards.
multilat¬
full
Business
on
his country's historical inflationary expe¬
riences, holding they have
many
British
can
of
Mr. de Largentaye traces
tated
indignity of wrig¬
gling out of
taken
Director
Executive
Delegation at
British Trade official points out six-year all-out war effort necessi¬
large-scale sale of overseas investments, greatly increased
indebtedness, and reduced living standard. Present efforts centered
on
drive for exports, on which surprising progress has been
achieved—their volume already exceeding 1938 level. Under strict
Holds this
co
of U.K.
Preparatory Committee for World Conference on Trade Employment
,
will spare Britain
Trade and Leader
Overseas
Copy
£? By J. de LARGENTAYE
By H. A. MARQUAND, M.P.
Dr. Einzig sees
1
Cost and British Inflationary Experiences in France
V. S. Elections
tial U. S. tariff cuts.
Price 60 Cents a
York, N. Y., Thursday, November 21, 1946
The High Wai
Britain and
Sections-Section
In 2
their favor an excep¬
profit
of
which
scarcity,
(Continued on page 2635)
j
Tonight I want
Association of Stock Exchange Firms,
(Continued on page 2637) ;
.
.
State and
2640) ua
*
Aerovox Corp.*
:
gulf, mobile*
& ohio rr:
Havana Litho. Co.*
ffjj Municipal
STATE
AND
MUNICIPAL
|||w|Bonds;,:-pg.;
iV*r
•
Prospectus on request
COMMON STOCK
J;
v
BONDS
•,*.v f /' '7'5
'v
\^ % r.•
<
$
„
Analysis on request
Hirsch & Co.
A
HIRSCH, LILIENTHAL A
Members
York
New
Established
Geneva
Buffalo
Albany
Dallas
OF NEW YORK
Bond
FINANCE
26, Bishopsgate,
London, E. C.
Dept. Teletype: NY 1-708 ' ;
Paid-Up Capital
Reserve
Fund
'
MARKETS
conducts every description
banking and exchange business
Bank
Trusteeships and Executorships
also
undertaken
90c
N.
Y
*Prospectus on request
Company
Security
New York
1-308
Montreal
THE CHASE
:
Reynolds & Exchange
Co.
Dealers Ass'n
Members New York Stock
NATIONAL BANK
~
OF
England
Public Service Co.
Appraisal of
•
Hardy & Co.
Members New
Members New
York Stock Exchange
York Curb Exchange
45 Nassau Street
Tel.
REctor
2-3600
TVIwhono
New York 5
Teletype N. Y 1-876
«Sntprt»rl*»
6016
120
.
■'
Broadway, New York 5,
N. Y.
Telephone: REctor 2-8600
-Bell Teletype NY 1-635
30 Broad St.
New York 4
TeL DIgby 4-7800
Tele. NY 1-733
Values
available upon request
IRA HAUPT &
CO.
Members New York Stock Exchange
and other Principal Exchanges
111
Broadway
York 6
New
REctor
of
NEW YORK
New
for Banks, Brokers
and Dealers
THE CITY OF
Toronto
Service
~
Conv. Preferred
*Twin Coach Company
INCORPORATED
Members
The
HAnover 2-0986
8T., N. Y.
Bond Brokerage
Conv. Preferred
Gearhart &
£4,000,000
—£2,000,000
£2,200,000
Alloys, Inc.
Solar Aircraft Company
-
In
Subscribed Capital-.,
WILLIAM
^Detroit Harvester Co. Com.
//:
SECONDARY
Office:
52
Conv. Preferred
India, Burma, Ceylon, Kenya
Colony and Aden and Zanzibar
Branches
& CO.
[Bond Department
Dealers Assn.
Bell Teletype NY
the Government in
Kenya Colony and Uganda
New York Security
Syracuaa
•CORPORATE
of INDIA, LIMITED
Head
<
Washington, D. C.
Scranton
Wilkes-Barre
New Haven
Woonsocket
Pittsburgh
Springfield
'Representative)
New York 5
Acme Aluminum
to
»
THE NATIONAL CITY BANK HART SMITH
PHILADELPHIA
BOSTON
Troy
NATIONAL BANK
Bankers
11
Members
Baltimore
Londoa
1927
SECURITIES
64 Wall Street,
Teletype NT 1-21#
Cleveland
OklesKO
INVESTMENT
stock Exchange
25 Broad St., New York 4, N. Y.
2-0600
R. H. Johnson & Co.
CO.
and other Exchanges
HAnover
£
1
'
Successors to
2-3100
10 Post Office Sq.
Boston 9
Hancock 3780
Tele. NY 1-2708
Direct
Private Wire to
Boston
2602
THE COMMERCIAL & FINANCIAL CHRONICLE
Thursday,: November 21,
'.Trading Markets int
The Challenge to
Standard G & E Com.
Hood Chemical*
^ \
Shields & Co. Adds
Leadership
'
*'
By ERNEST R. BREECII*
<
to
The
Doherty has
ing profits trends and uncertainties of business, pro fits.
Defends "bigness"-as essential to mass pro/ (taction, but holds problem arises from loss of personal contact} with employees—a gap organized
labor now fills.
Contends there's too much isolation of business, management ahd wantsnjore consulfation between business, labor and government.
SECURITIES CORP.
1920
■
Members N. Y. Security Dealers Assn.
Dealers,
Securities
of
Ass'n
_
~
BBLL TRLETYPB NY 1-423
we
b 1
a c
'
hampered production have
really been strikes against
employers at all, but maneuvers
in
the internal
political battles
what people
We
look
at times,
as,
are
wars
employer and employee to become
outright attempts to coerce our
dering
led
into
MitcMU Company
Members Baltimore Stock Exchange
Bell
2-4230
The
Farmers, who maintained
s-
results
E.
elec¬
Breech
R.
Historian James
tions ;are. in¬
Stock
terpreted by many as proof of
general dissatisfaction with the
way,
Hathaway Bakeries
New, When
Common
Issued
Savoy Plata
3/6s,
:
1956
Savoy Plaza
j
Class "A"
being
Vanderhoef & Robinson
Members New
York Curb Exchange
31 Nassau Street, New York 5
Telephone
Bell
COrtlandt
;
going.
are
7-4070
Stock
•
misused
create
to
will
a
'
*v i
J
»
A'"'
crash
NY
Adams,
New
3-1223
120
York
the
of
He
former
a
New
James T. Adams
of
Stock
Exchange,
Pulitzer Prize
American
analysis,
which
employs
history as a frame of
reference, traces the patterns of
inflation and depression following
wars from the Revolution to
our
York
World War II.
Exchange
Curb Exchange
placement
or
the
of
accumulation
large
blocks
"•
»V vV?
''.'V
'<?
,
1
1
' r'
when
the
maladjustments
in
practically been
There
A
'
1
'
*
merchants'
Members N. Y.
Bell
Security Dealers Assn.
St., N. Y. 5
Hanover 2-4850
houses
Teletypes—NY 1-1126 & 1127 '
NEW YORK
1
.
-
6, N. Y.
marched
Sugar Corp.
closed
their
that
Quotations Upon Request
FARR
New
120
York
York
New
&
York
Cutb
CO.
Stock
Exch.
Exchange
Assoc.
Member
farms
Coffee & Sugar Exchange
WALL
ST.,
NEW
YORK
TEL. HANOVER 2-9612
could
not
Common
Common
frank C.Masterson&Co.
Members New
Telephone HAnover 2-2400
Private Wires to
Teletype 1-376-377-378
Buffalo—■Cleveland-—Detroit—Pittsburgh—-St. Louis.
York Curb Exchange
;j;f
64 WALL ST.
Teletype NY 1-1140
NEW
YORK 0
HAnover 2-8470
Curb arid Unlisted
Securities
Michael HEANEY^ m'sk l
WALTER KANE, Asst. Mgr.
Joseph McManus &Co.
Members
2643)
on page
■
•
,
.
"*•
••l.s'S
:
^
7 L
Common
.'•
.
■ V,: J
*
^
.
AA
KA: and
;Si||Rights
~
SOLD
QUOTED
INCORPORATED,
Digby 4-3122
Exchange
New York 6
*
Teletype NY 1-1610
Western Union Leased
V
.•
«V.
Line Stocks
-
...
V
*
•
I
.
,
International Ocean Telegraph Co.
Pacific & Atlantic Telegraph Co.
Empire & Bay States Teleg. Co.
bought
-
Tele. NY 1-1815
sold
*
quoted
.
Arnhold and S. Bleichroeder
NEW YORK 5
ESTABLISHED 1890
Tel. HAnover 2-9300
York Curb
Southern & Atlantic Tele. Co.
—
J-G-White 6 Company
37 WALL STREET
New
Chicago Stock Exchange
39 Broadway
;
74 Trinity Place, New York 6, N. Y.
Stock
Hotel Waldorf-Astoria
When the maladjust¬
a
-
York Security Dealers Association
/
Aspiuook Corp.
ELECTRIC & GAS
Member New
Y.
Common
be
1790's when Colonel Duer,
greatest speculator in New
the
Troster, Currie & Summers
Teletype NY 1-1919 y,
got straightened out
had
BOUGHT
Members
H
Central States Elec. (Va.)
early
Trading Market
New
them
a bit,
period of inflationary
speculation which lasted until the
HAILLE MINES
.
court¬
on
CENTRAL ILLINOIS
,
•
/*/.
r
became
Teletype NY 1-672
For Banhe, Brokers & Dealers
-
,
t
Con¬
and
(Continued
Punta Alegre
*
Southern Colorado Power1
so on,
we
^
S,
the
in
so
Members N. Y. Stock
Exchange and Other Principal Exchanges
Telephone BArclay T-0100
all
necticut, Massachusetts, and
Goodbody & Co.
115 BROADWAY
accustomed
shelves
and
farmers
ments
17 Wall
having been
during
the
long
war,
started in to buy. Wages went up,
foreclosed.
&Teene<mdGomparv^
t
New York 4, N.
1781.
prosperity
things
the
Canadian Securities Dept.
'
Broadway WHitehall 4-8120
Bell System
things
we have just been
Then there were two
years, from
1785 to 1787, when
there was intense depression and
of
.
Members New York Stock Exchange
50
witnessing.
* "
'
Members New York Curb Exchange
happened which
Dominion of Canada Internal Bonds
Over-the-Counter Stocks and Bonds.
a
^eem
because human nature
many
,
'.yS
Elec. Com.
Edward A. Purcell & Co.
since
apparent
was
1785
over
of
,
-
,
Central Pub. Util. 5%s
Revolution, peace was signed
1783
although the war had
deprived
*
\
Scran ton.
"For example, after the Ameri¬
can
and
|
/A"'
t<j have been overcome.
itself
'
'
i
the
years.
Then comes a new
period of rather wild speculation
"In my
""
offices
Birmingham Electric
■
all
and
ple of
overstocked
*
to our branch
Northern Indiana P.S.
'
manu¬
factors, get out of kilter and
maladjustments have to be
by a serious general de¬
cline which may last about a cou¬
until
We Maintain Active Markets in U. S. FUNDS
for
NY 1-1557
other
the
1
for
products
asserted
opinion, the pattern of
Exchange
American Gas & Powet
eco¬
year or
His report follows:
5
any
corrected
His
Stock
on
the
York
history for his vol¬
"The Founding of New Eng¬
land," and is a Trustee of the
Bridgeport People's Savings Bank.
'ft4
it is based not
factured
our
maintained
*.'{'
La.-Birmingham, Ala.
Direct wirei
every
prices of farm products and
prices in stocks and commodities
is
•y
HAnover 2-0700
New Orleans,
of sudden prosperity. Then wages,
winner of the 1922
TeL REctor 2-7815
Department
*,)
*,"v- *>.
■
>-
and even occasionally
two, has been that after
a war ends and peace is
declared,
there are a couple of years or so
a
American
the
in
BROADWAY, NEW YORK
piker."
months
to
and
Treasurer and
Members
1-1843
"Special Situations"
Request
25 Broad Str New York 4t N. V.
York
nomic laws, in which I do not be¬
lieve, but on old human nature,
which does not change.
This pat¬
tern, although the periods vary as
piker."
Chancellor
McDonnell&qo.
New
'
cause
ume,
5»,fV
a
■"
after
writer, is the
'
WHitehall
Teletype
v;'
J.'J
'
)t.
Members New York Stock
on
like
...
make
Dr..
American Overseas
y V' «1
*
*
American
Bell
V
on
Steiner, Rouse & Co.
Depression
the pattern remains the same be¬
member
'
s
1929 look like
Bought—Sold-^Quoted
Telephone:
V'1'.
/slv.-y'
V,'. V*
•.
Analysis
2632)
on page
pre¬
historian
Wells
20 Pine Street, New York 5
(Continued
V " ■/;/
J,
,S i'V'
-
155th
"next
labor
monopolies and to strengthen the
personal political power of indi¬
vidual labor leaders. ;Tt is pointed
out that many of the strikes which
Airlines
H. G. BRUMS & CO.
.
Bought——Sold-*—Quoted
'V
great war has been
practically the same, at least since
the American Revolution.
I think
Street,
Common & Preferred
,'Common Stock
*•,»'.
dicted that the
was
A. S. Campbell Company
Struthers
\^
offices, 633
;v
y,
people
more than gov¬
ernment leaders or labor leaders
Exchange, bases statement
Academy.
,
American
past postwar pattern! and
advises getting out of speculative stock within a few years "becausfe L
West
•
• t;'.>; yry• y ;;•
W
.
Bidg.
Manufacturing Co.
and Letters at
Corporation
Common
•' • •
.•
the
Truslow Adams, former member of New
the Academy's
*An address by Mr. Breech be¬
fore the Chamber of Commerce,
Jefferson City, Mo., Nov. 14, 1946.
;
Chronicle)
Rockwell
James Truslow Adams in his Treasurer's Report delivered on
Nov. 19, at the annual meeting of the American
Academy of Arts
System Teletype NY 1-1548
Byrndun
Financial
f A, White & Co., Unioh Cen¬
tral
whole, have done
that
next crash wiH make 1929 look
>*
breaking down public confidence
in organized labor because they
put their own interests ahead of
the general good. In the opinion
of much of the American public,
the
strike—generally recognized
as a legitimate "last resort" tool in
orderly collective bargaining—is
Preferred
&
things
Labor leaders, we are told, are
Rogers Peet
of
think that business leaders, on the
Predicts Severe
recent
our
national
1-1227
NY
Teletype
of
4
The
"Wise has been added, to the staff
and
While
government.
un¬
d i
tb
respect of law
and order. Y
■
WOrth
us
an
healthy
Broadway, N. Y. 5
120
(Specie'
butter and eggs at con¬
orices, have been accused
of: withholding
food from the
American people because of self¬
ish greed.
the field of negotiations between
have
'
•
CINCINNATI, OmdSjosephBl
trolled
reminded that they have,
broken completely out "Of
gover n m e n t
Quoted
ton
between unions.
blun
—
pret-
they could not, without financial
loss, sell their beef, pork and mut¬
not
which mark
upon
was
*
„
have
that
k-mar-
a
McEWEN & KAISER
Bought — Sold
the
<$>-
keteering and
rising tide of
criticism of;
MAY
He"
mmrn
To anyone who reads the daily newspapers and listens to the radio and studies
public opinion polls,
to be a nation working at cross purposes a nd without clear direction.
We are told that respect for our country abroad has declined since the end of the war.
Here at
evidence
V
J.
to
With J. A. White & Col
seem
home there is
:
added
*;
Inc.
HA 2-8778
Exchange PI., N.Y. B
been
Street.
:
KING & KING
•0
v"v
the U. S. Navy..-
-
Nafl
-
Chronicle)
staff *of Shields & Co., 135 South.
Leading auto executive, asserting elections indicate people are waiting for new leadership, says it can
La Salle
supplied by business and industrial management.
Says our economy is a "Profit and Loss System," f
viously in
and business at times must assume losses, citing Ford's loss of $51 million in 1946.
Points out declin- Y
be
Prospectus
Established
Financial
CHICAGO, ILL.—Augustine
;
-
-
(Special
Executive Vice-President, Ford Motor Co.
Expreso Aereo
Taca Airways*
Higgins, Inc*
•With
t'
''
1946
INC.
30 Broad St.
WHitehall
3-9200
New York
Teletype
NY
1-51
Volume 164
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4544
Boom
Page
Inflationary Experiences in France—the Effects
Business—J. De Largentaye
w.........
™
j
on
-
i; H. A.
Marquant
.Cover
Securities Regulation Will Be Relaxed—James J. Caffrey__Cover
The Challenge to Leadership—Ernest R, Breech-—_2602
Predicts Severe Depression—James Truslow Adams.--.
2602
Boom or Bust—S. B. Lurie.
2603
'
:
i
it The Mountain Labored—Result: One Mouse—(Editorial),-2603
Outlook for Austria's
Reconstruction—Victor Kienbock.
j
John W.< Snyder
Business Outlook
;
for
2605
Jr.——-2607
2607
Bread and Liberty—Henry R. Luce.
,_,_2607
Economic Stability and High Output—Amos E. Taylor—-2608
The CIO and Wages—Philip Murray-.—-——-—,2609
World Oil Outlook—J. Howard Pew———
--—2609
Marketing Outlook in 1947—Harvey S. Firestone,
Getting Back to Normal—Claude L, Benner
Increasing Labor Productivity—John D. Gill
i
Restoring Equality in Collective Bargaining—
•
w:
09
-
JlMi '
]KL
500-5th Ave,
91
I H
4s 6i
The Madison
Sidney b. Lurie
3-6 Vz s/57
hay and
grass
for
39
Broadway, New York, N. Y.
HAnover 2-8970
f,"'
New York
>.
|
The Mountain Labored
Com. & Pfd. *
BOWSER, INC.
Com. & Pfd.
r
BOTANY WORSTED
Com.
J
^
——
As Mr.
•"No Deflation Threat in Debt Retirement"—
:
NYSE Wants Securities Acts
Regulation W_
:
Simplified to Aid Listing of
j
Regular Features
Rank and Insurance Stocks.,,
Our Reporter's Report
Paul Einzig
Business Man's Bookshelf...., ..2617
..2608
2622
Securities Salesman's
Mutual Funds
Calendar,
Tomorrow's
Markets
household-appliances, is hardly in accord
the mandate of the American people who voted to end
jthe war-born government controls over our
jwith
(Walter
Whyte Says)
Observations—A, Wilfred May.
economy.
........2654
Government agencies and bureaus
-
?
York, N.
i, 1879,;
published Twice Weekly
The COMMERCIAL and
j
|
FINANCIAL CHRONICLE
•
-.-■•i
;
Reg. U. S. Patent Office
:
" REctor 2-9570 to 9576
DANA
SEIBERT,
.
,
r
when it is
necessary for them to relinquish powers they
have enjoyed.
We have observed a reluctant
scurry to
S.
(Continued
ol
on
page
$25.00
Punia Alegre
.
Lea Fabrics
->•
^
U. S.
Quotation Record-^bionthly,
(Foreign postage extra.).
Earnings
per year.
Record
:
Monthly;
(Foreign postage extra.)
—
Class A Common Stock
of
exchange, remittances for for-,
jeign subscriptions and advertisements must
ibe made in New York
funds,,,
f..
j
Susquehanna Mills
„
*Frospectus on request
135 8. La Salle St., Chi111. (Telephone; State 0613); 1
Urapers? Gardens, London, E, C., England,
*/o Edwards & Smith.
other Offices:
-
3,
\
'Reentered
25,
.
as
1942,
DUNNE&CO
Leland Elec.
Copyright 1946 by-William B. Dana
ary
Sugar
Commodore Hotel 3
^Fidelity Electric Co,
Note—On account of the fluctuations ir
rate
Sugar
Eastern Sugar Assoc.
'
;the
2-0300
Haytian Corporation
2650)
$25.00 per year.
vertising Issue)
rago
WOrth
Teletype NY 1-84
,
Other Publications '
Bank and
}
Monthly
Every Thursday (general news and ad¬
and every Monday (com¬
plete statistical issue -r- market quotation
records, corporation news, bank clearings,
«tate and city news, etc.)
'
\
;
WILLIAM P. RIGGS, Business Manager
t
March
Broadway
Bell System
chronically die hard
of
i
Thursday, November 21, 1946
of
Members New York Security Dealers Assn.
170
Union, $26.00 per year; in
Canada,
$29.00- per yea^
Countries, $33.00 per year.
Other
President
Act
Pan-American
Dominion
28 Park Place, New York'8, N, Y,
WILLIAM
the
'
Subscription Rates-
,
OERBERT D. SEIBERT, Editor & Publisher
;;
1
Subscriptions in United States,
Possessions,
Territories
and -Members
.v.,,
WILLIAM B. DANA COMPANY, Publishers
-I
under
y.,
Billings & Spencer
National Shirt Shops
automobiles and
Corner..'. .2632
Now iii Registration."2655
Securities
New Security Issues
Cover
Public Utility Securities..
National Company
citrant follower of the electorate's mandate. The Hoard's
action of last
Friday in relaxing certain consumer credit
restrictions under its Regulation
W, while maintaining a
firm restraint on such vital
products of our economy as
.2663
Railroad Securities
Recommendations
Thiokol Corp.
unique in refusing
most, in being a "very recal¬
ProspectiveSecurttyOfferins!Si..266l
..2630
TRADING MARKETS
But the Federal Reserve Board is
to follow this
tradition—or, at
Our Reporter, oq. Governments.%.2C28
Britain and U. S. Elections—,
Cover
: Paul Einzig ..i,4..... 1......
Dealer-Broker Investment
said: "The Supreme Court follows
This obeisance to the electorate's ex¬
once
pressed ivill is even more widely demonstrated
today. For
surely Mr. .Truman's display of firmness toward Mr.
Lewis,
jarid GK^rmah Caffrey's announcement of relaxation of SEC
jcontrol, are not unrelated to the result of the
people's
JNov. 5 balloting.
J
.......—
Foreign. Issues-——
Canadian Securities.
Dooley
the election returns."
John K. Langum———
Federal Reserve Board Revises
& Pfd.
Appraisal of the Federal Reserve Board's Revision
of Its Consumer Credit Regulation
;
Broker Wants NYSE to Clear Way for Court Test of 100%
Contract.
Security Dealers, Inc.
-2616
An
TJFE and NYSE Sign New,
Security Dealers Assn.
National Assn. of
Germain..—2619
Impending Crisis in Agriculture—Edmour
—
Teletype NY 1-1203
Member of
AERONCA AIR
———------—,—*2617
Election Effects—Roger W. Babson.
..2619
Margins
customers
Telephone: WHitehall 4-6551
Marketing Official Sees. Need for FQod $tamp Plan to Meet.,
-
many
WALL STREET, NEW YORK
AN EDITORIAL
Col. Herbert G. King
♦
so
actually want those things!
G. Klumpp—---2616
Economic Effects of Longevity—Theodore
has
ob¬
nobody,
(Continued oq piage 2645)
Stock Market Pessimism Not Warranted—
Analyzing
but nobody
that
your
because
•; JR®
Wgm,
•
IP
power as.
—2614
Is tJ. S. Military Government Deserting Economic
Democracy?—Herbert M. Bratter—,—*
better price for
a
securities,
Obsolete Securities Dept.
-
of today. Thus the market itself- raises
'questions; (1) Is the stability achieved within a 15-point
[trading range merely a hiatus before another storm? Or (2)
is the change in
pace, following the post-Labor
Day panic, a
significantly favorable omen?
...2613
—
—-
tBN
HBfe
However,
than fluctuate between
Prospects—
Business Outlook Key to Stock Market
a Y. Biliard
I
more
pay
solete
two
—261S
Hard Money Theory of Interest RatesWilliam Witherspoon.,—
—-——
#
chasing
Business—
A Central Underwriting Fund for Small
Ernest J. Hopkins—.—
—
;
j
,
(6) the reversal in deficit spending.
can
-
;
the past two months. No better
illustration is needed than
the fact that cash obtained from the
liquidatibn; of equities
in recent weeks does not
enjpy a significant increase in pur¬
Ball——--———2611
S.
Stuart
prices;
(3) deflationary potential in continued inventory
accumulation; (4) indicated thwarting of the building boom; (5) declining trend in capital outlays;
4one little
Nobody
But NOBODY
high
Although not borne out by speculative
psychology, the stock market in effect has
—-2609
—,2610
Why the Confusion?—Alfred P. Sloan, Jr.,
against
;will not appreciably break recent bottom; that
stocks may be bought for
strong rallies; but that
!a real bull market is still far off.
.
'
rebellion
we will not have a
major depression but merely a "deflationary gap"; and—
; noting stock market has
successfully withstood suecessive waves of liquidation—that
1946-1947 prices
2605
_
& Curtis
Mr. Lurie concludes
2604
1947—Raymond Rodgers__
consumers'
and
:/ The Production Outlook for 1947—John D. Small—
r2606
Remedial Deflation Needed!—James B. Bancroft—-.,__;-I_2606
'
(2)
2604
f Switzerland's Wartime Economic Policy—Ernest Speiser
j The America of Tomorrow—An Optimistic Outlook—
AND COMPANY
Market Analyst, Paine, Webber, Jackson
Analyst cites following factors unfavorably determining the level of
industrial production: (1) prospective
buyers' market in soft goods;
.t,...Cover
The High War Cost and British Foreign Trade Policy—
.f
.
Bust?
or
By S. B. LURIE
.
Articles and News
Company- , * "»
•
>
second-class matter Febru¬
Members New York Security Dealers Assn.
25 Broad St., New York 4, N. Y.
.
Cleve. Worst. Mis.
at the post office at New
WHitehall 3-0272—Teletype NY 1-956
Private
Collyer Insul. Wire
Plymouth Cordage
TITLE COMPANY
CERTIFICATES
Bond & Mtge. Guar. Co.
Nath.
Lawyers Mortgage Co.
Bottling Co. of Chicago
Coca-Cola Bottling Co. of Los
Angeles
Panama Coca-Cola
Bottling Co.
STRAUSS BROS.
Co.|:
Members
32
Prudence Co.
N.
Y.
Broadway
Red Rock
*
•NEW YORK 4
Newburger, Loeb & Co
« Members New York Stock Exchange
15 Broad St, N.Y. 5
Bell
Teletype NY 1-832, 834
I
■
& Trust Co.
Analysis
upon
Request,
CHICAGO 4
ESTABLISHED
'* Harrison 2076
?'/
City—Los Angeles j.;'
1914
C.E. Unterberg&Co.
Specialists in Soft Drink Stocks
Teletype CG 129
York—Chicago—St. Louis
Kansas
1968
*Public National Bank
Board of Trade Bldg.
Direct Wire Service
New
WHitehall 4-6330
Teletype NY 1-2033
.
6s,
*
-
DIgby 4-8640
Publications, Inc.
Bottlers, Inc. (Atlanta)
Security Dealers Assn.
1 < *
Macfadden
Coca-Cola
Strauss-Dup.
.
Lawyers Title & Guar. Co.
N. Y. Title & Mtge.
Coca-Cola Bottling Co/ of New York
CoCa-Cola. Bottling Co. of St. Louis
Wire to Boston
74
i\;V>
Trinity Place, New York 6, N. Y.
Telephone:
v'
BOwling Green 9-7400
r
;
*
*
Teletypes:
NY 1-375
—
NY 1-2751
Members- N.
61
Y.
Security Dealers' Ass'n
Broadway, New York 6, N. Y.
Telephone BOwliny
Green 9-3565
Teletype NY 1-1666
2604
THE COMMERCIAL & FINANCIAL CHRONICLE
•;>>. ' r-"'"
''"
Thursday, November 21, 1946
BUSINESS BUZZ
Outlook for Ausfriafs
Reconstruction
By DR. VICTOR KIENBOCK
ACTUAL MAflKEIS
1
IN 250
I
ACTIVE ISSUES
■'
-
V--
:!#•- ."v
& V&*
-"-V
y
"'
* ■■v >
'
"<
"
v
^
" ~
•
;
■
s
Amer. Window Glasi*
&
Com.
Pfd.
Automatic Instrument
economic
'S'Sfill#
<$-
barley
1919
to
territory
now
Douglas Shoe4;
ExpresoAereo |f|
General Machinery
the
then,
as
Higgins Inc.
1923,
whereas in 1936 almost no
count is taken
at
of
milk
displaced
and
the occupying
forces — is
probably approxima t e 1 y
the
same.
It
Dr.
Kienbock
Victor
is
that Austria, which,
immediately after the end of the
iirst world war, had been left as
noteworthy
.
Lariova*
remnant of the
a
| Majestic Radio & Tel.
Mastic Asphalt
imports of sugar, in
1 million quintals,
necessary.
and
—
'
Jack & Heintz
is
same
the population
if no ac¬
persons
| Gt Amer. Industries!
Hartford-Empire Co.*
to
in the
mil¬
im¬
ports of potatoes amounted, in, the
year 1923, to 780,000: quintals, in
1936 to only 76,000 quintals; the
1938.
Austria
million quintals;
year 1936 it had .fallen- to; 4
lion quintals,. The necessary
from
years!
amounted
oats)
and
7
The
District Theatres!-
great old state,
found itself in acute
distress, and,
after the first
war, presented hardly an
encouraging picture. If now we
cast a summary glance over the
way in which conditions devel¬
oped since the year 1922, in which
in
the
first
years
world
were
all
were
imports
Of milk and
needed.
products there were neces¬
sary imports, in the year 1923,
amounting to 939,000. quintals; in
the year 1936, there was, instead
of necessary imports, an export
surplus of 180,300 quintals.
Of
coal, there was, in 1923, a re¬
quired import of 4,528,000 quin¬
tals;
in
the year
1936
there
were required imports of 2,550,000
quintals.
The tourist traffic
showed, in 1923, 13,300,000 mil¬
lion overnight bookings, in 1936
there were
19,629,000 overnight
bookings; at the same time the
frequency of travel from Ger¬
"You Businessmen Are Certainly Careless With Your Charts.
many was declining, while jour¬
If You Had Used A Ruler You Would Have A Nice Even
neys
by foreigners from other
Line Instead of That Ugly, Crooked Thing I"
the reconstruction of the economy countries showed an increasing
began, up to the rape by Hitler, number of visitors. The balance
of payments of Austria in the last
we find the following impressive
figures:. years
before Hitler's invasion,
Michigan Chemical
Missouri Pac.
Old Pfd.
Mohawk Rubber*
Moxie
N.Y. New Hav. & Hart
One
Prod.*|p
Richardson Co.
without
The Situation After World
Pfd.
Purolator
>
around
of
Old
-
Austria in the
Diehold Inc.*
I
^
re-
building of
Chicago R. I. & Pac.
0,d pfd-
;
struction
Cinecolor
''
Austrian banker notes improvement in Austria's economic situation
during pre-Hitler period, as evidencing permanent adjustability of
population. Although her problem is more difficult now, Dr. Kienbock cites favorable factors of greater goodwill of neighboring
countries, and increase in electric energy and oil output which enchances independence from coal importing.
Insists Hitler-stolen
property must be returned to original owners.
Anyone who has concerned himself with the economic recon¬
of Austria will doubtless recall the experiences in the
Barcalo Mfg. Co.*
J
Austrian National Bank
Advisor and Former President,
War
the
assumption
of new
Switzerland's Wartime Economic
foreign debts by Austria, had be¬
.
In the year 1923 the necessary
imports of cereals (wheat, rye,
and
stabilized,
come
Policy
exchange
,
(Continued on page 2640)
By ERNEST SPEISER
Swiss State's Councillor; Director, Brown Boveri & Co.;
Former Head of Federal War Office for Industries and Work.
Taylor-Wharton*
Tenn. Products p
^District Theatres
pp;* Upson Corp.*
U. S. Air Conditioning I
*Metal Forming Corp.
*Dumont Electric
*
United Drill & Tool "B"
in imiiinnin
resistance against
u -
FIRST COLONY CORPORATION
Alabama Mills*
Members
New
York
Security Dealers Association
52 Wall Street
New York 5, N. Y.
Tel. HAnover 2-8080
Aspinook Corp.*
than she gave her.
Teletype NT 1*2425
Textron Wrats. & Pfd.
.
the
Hague
Convention of
1907
for
Cent. States Elec., Com.
Derby Gas & Elec.
Paget S'nd P. & L. Com.
,
Spec. Part.
.
f
'
ft
I*.- **
.....
Standard Gas Elec.
tProspectus Upon Request
*Bulletin
or
Circular
upon
•».;-»
*
«■
when
Central National
;
r-i
important
-
...
,
Teletype: NY 1-2940
Telephone: LExington 2-7300
land
of 'the* contents
and
im¬
plications of such agreements, for
Ernst Spelser
on
indeed
-
which
194*0, which:-fixed the
25,
Obligations
these
the
were
Switzerland
tiate with both
had
camps.
basis
to
on
nego¬
Switzer¬
limits within which Switzer¬
land knows from long experience
able to trade with the
that absolute loyalty to treaties is
was
Axis.
request
formed
ement
made with the
exact
Observance of Treaty
>
e
April
Street, New York 16, N. Y.
'
{ It Is obvious that the other bel¬
ligerent party in each case was in¬
was
Allies,
the rulings of the "coun¬
dates from Aug. 9,
; -
ter-blockade"
the War Trade
Corporation
ESTABLISHED 1927.
22 East 40th
■;!•
many on
the
latter the most
issued
be
[ The first agreement with Ger¬
these
Among
Agr
....
.
;
-
Due December 15, 1961
Delivery
Southwest Natural Gas
i
|
■ ■
1940.
powers.
-
2%% Convertible Debentures
Southeastern Corp.
p''
Telegraph Co.
Subscription Eights and
a
years.
b ellig erent
of
should
goods
pormal compass. Of the preceding
she
is'uccessively
signed'* with
some
no
many must be: kept within the
as
Quoted
Sold
American Telephone &
that
re-exported in an unaltered state,
and that the whole export to Ger¬
the
as
treaties
New England P. S. Com.
things
M
wars
land,
on
Bought
"
European totalitarianism.
It should be stated first of all, that in all her trade relations, both
with Axis powers and with the Allies, Switzerland strictly observed
the rulings of
<♦>-
well,
American Gas & Pow.
Points out Switzerland's strict observance of
treaties wilh all countries, a necessity for all weak powers*
Mainbins free democratic Switzerland was vital to the preservation of
Prospectus Available
Vacuum Concrete 5
ii
Swiss official, denying pro-Axis wartime slant by Switzerland, cites
data to show that she obtained considerably more from Germany
*Hungerford Plastics
It
provided
among
other
(Continued
on cage
2630)
~
;.;v>
ACTIVE MARKETS
*Argo Oil Corporation
Stand. Comm. Tobacco
EST
General Crude Oil
■Osgood Co. "B"
^Tennessee Products
120 BROADWAY, N.Y. 5
RErtor 2-8700
'
*Wellman
::rf*
Engineering
Direct Wires To
•
v>
/ r
Robert Reis Common
• Descriptive Circulars
Bos. 2100
;
V
.
Jc
Great American
i Aeronca Aircraft
•
Incorporated
'
Members New York Security Dealers
41 Broad Street,
New York 4
.
4
: 4
Association
*Prospectus
Soya Corp.
on request
j.K.Rice,Jr.&Co.
:
Established 1908: ! '• i-.-;.
-
Members
[ i
HAnover 2-2100
Industries
U. S. Finishing Com. & Pfd.
request
on
Seligman, Lubetkin & Co.
ENTERPRISE PHONES
Buff. 6021
;
•
:
Electrol, Incorporated
N.Y. 1-1286-1287-1288 *
Gblcago, Phlla. & Los Angeles
Di-Noc Co.
"Capital -Records
'
1926
Afembm N.Y. Security Dealers Assn.
Ztartf'd 6111
♦Hoving Corp.
N.
Y.
Security
REctor 2-4500—120
:j
:
Dealers Assn.
SIEGEL & CO.
89 Broadway, N. Y.
6
-
DIgby 4-2879
Broadway
Bell System Teletype N. Y.
1-714 !
\» v.
Teletype NY 1-1942
S
Volume
164
-■
'
■'
'
■-
"
2605
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4544
'
■■
■'
-
■-
"■
_i__;
•
'
■
-
*
The America of Tomorrow
—An
Optimistic Outlook
Hirsch
——1
By A. WILFRED MAY
4
.1
<
"/
on
UNRRA
v
"Neither a borrower,*nor a lender be;
I For lone oft loses both it selfe and friend:
„>
And boirowing duls the edge of husbandry
'
Street,
25 Broad
Co.,
York
York
that. J. Dalton Couig has become
associated with the firm as man¬
;i:'rj-Must UN Play Santa Claus?—
Shakespeare
&
City, Members NewStock Exchange, announce
New
ager
of the institutional bond de¬
partment. Mr. Couig was formerly
,V.•> 1
a
partner in Gregory & Son, Inc.
Unlike most of Shakespeare,
Polonius' stricture against borrow¬
ing because of its alleged hindrance to husbandry, is not valid today—
as the international- sphere is concerned.
For instance,
the Czechoslovakian borrower not only "husbanded" the funds she
at least as far
got from the United States, but has resold them
she took over valuable property of our
citizens through nationalization technique.
And
measure,
the $490,000,000
of relief that went to Mr. Tito of
Yugoslavia certainly was not wastefully squan¬
dered by that gentleman.
He has used American
food and goods for reinforcing his partisan pol¬
Bto another (Rumania) at a go d profit. For go d
*
Merrill
City, members of the New York
Stock
On
other
the
hand, the other part of the
psychological
analysis
of
the
debtor-creditor relationship, which refers to the
.instillation of hostility in the borrower, is today
:
growing anti-American antip-athy on the part of Britishers. Whereas our
Wilfred May
present critical difficulties with the/Slavic coun¬
tries are caused by their long-term political as¬
pirations, British hostility seems to be engendered and stimulated by
validated' in the
j
her changed status to economic dependence on us.
was
dry on
our
Wm.
Vogler in Cambridge
H.
Volger is engaging in the in¬
vestment business from offices at
254
Massachusetts Avenue.
AMERICAN
has since steadily risen, before the ink
agreement to extend them the over-$3 billion loan.
sectional
association
with
the
Europe.
SECURITIES
Canadian
bank stocks
Similarly .'our perfectly proper cessation of Lend-Lease at the end
additionally fanned the flames of long-term British
resentment. Now, reflecting a widespread "beef" against our de-control and stopping of bulk purchases of food, "The New Statesman"
Canadian
mining stocks
Canadian
of the War has
of
London
in
its
issue
current
the
hurls
United States in its mad rush back to
fINT
CANADIAN
United
States," urged an¬
other M. P., Mr. Warbey.
And William Gallacher in the same House
argued there is bound to be a financial crash in the United States, of
which Great Britain will get the full backwash, if she is tied up with
the Americans, unless she first insulates herself by building up trade
agreements with the Soviet, France and other nations of Eastern
Business Outlook for 1947
%1A&E
MARKETS
And politically also, members of Britain's labor government
seemingly are getting themselves increasingly "needled" by Uncle
Santa.
"I must warn the Foreign Minister,'" said Laborite Tom
one-sided
Co.
CAMBRIDGE, MASS.—William
Such feeling from
Driberg in Commons last week, "the people of this country will cer¬
tainly not follow him to war now or in five years' time against Soviet
Russia, in partnership with the barbaric ■ thugs of Detroit or the
narrow imperial sts of Washington or Wall Street" "Let us drop this
In the past
with F. S; Moseley &
was
British friends began and
our
that
announces
associated with them.
vis-a-vis his political opponents; for direct he
resales; for building an army a million strong;
Shakespearian
Exchange,
William H. Culbertson has become
icy
•
Lynch, Pierce, Fenner &
Beane, 70 Pine Street, New York
following; tirade:
"The
government bonds
Canadian
' C; '
*
*
purely selfish capitalism, has
a
apparently decided to walk out of (sic)
industrial bonds
functional internationalism
it is clear that on the matters that most affect Britain today, the
United States is nearly as hostile to the aspirations of Socialist Britain
as to the Soviet Union
if Mr. Bevin finds that the State Depart¬
...
.
.
.
ment's victory is absolute,
Mr. La Guar,dia's
Public
eloquent ptea to the UN to found a gigantic
•,
International
Fund
Food
feed
to
(Continued
Bought
Europe
on
page
Sold
—
—
in ' lieu
2662)
of
the
"
Canadian*
he will have to look elsewhere for friends,"
^
utility bonds
expiring
Quoted
•
;
Bell
HAnover 2-Q9W
Y. 5
52 WILLIAM ST., N.
Teletype NY
1-395
Montreal)
New York
Toronto
Central Illinois
'
Galveston Houston
Electric & Gas Co
Lake
Jefferson
Common
—
Rights
Sulphur
& Pfd.
Com.
Jonas & Naumburg
Lane Cotton Mills Corp.
Standard Fruit
G. A. Saxton &
70 Pine
WHitehall 44970
Co., Inc.
& S/S
111 11
Street, New York 5, N. Y.
Teletype NY 1-609
■,
T. J. FEIBLEMAN & CO.
Members New Orleans
New York
Bo. 9-4432
Stock Exchange
New Orleans Ift, La.
4, N. Y.
Richards Bldg. Arcade
41 Broad St.
:;v
.■;
VK
Bell Tel.—NY-1-493
FOR BANKS, BROKERS
*
AMERICAN TELEPHONE &
*Air Producti,
TELEGRAPH CO.
Subscription Rights
-
' *
•
-
Conv.
Preferred
Delivery When Issued
Prospectus
'*:
fA"
Raytheon Manufacturing'Co..
Z%% Convertible Debentures due 1961
,
Inc. Com. &
Bought
—
on
Sold
Request
—
'
-
•
'
♦Universal Winding Co.
Quoted
Com.
+Prospectus on request
Reynolds & Co. :ij
Members
Established 1888
MEMBERS
N.
Y.
SECURITY
treet, New York 5, N.
Y.
i
; j ;
120
DEALERS ASSOCIATION
Bell Teletype NY 1-897
New
York
Stock
Exchangey|
Broadway, New York S, N« Y.
Telephone:
REctor 2-8600
Bell Teletype:
NY 1-635'
>
;
-
2606
:the commercial & financial chronicle
BALTIMORE
Starrett Corporation
Frank Andrews Partner
The Starrett Corporation is
Automatic Pinsetter
Baltimore
Transit
All
gaging in
the
from, offices
Co.
New York
Issues
securities
at JS3
en¬
business
Wall
Street,
City.
In Hautz &
...
Frank
T.
National
Sash
Weight
L.
Preferred
Gilbert Stover is~
proprietor
42
STEIN BROS. & BOYCE
Members New York & Baltimore Stock-
Exchanges and
other
6 S. CALVERT
leading exchanges
Proprietorship
Stover
of
Broadway,^ New
sole
now
&
Perkins,
York
•>
City,
Herbert L. Perkins having retired
from
partnership in the firm.
ST., BALTIMORE 2
,•
Bell Teletype BA <393
New York Telephone BEctor 2-3327
Andrews, formerly
;
Mr. Andrews, who has been in
Street
years'
American
V.
Girdler
-
■
'
Products
Saco Lowell
*
.
Inquiries Invited
:
,
.
James
Corporation
New
Winn
&
.;
Lovett Grocery
{
du
^Incorporated
Pont, Homsey Co.
31 MILK
BOSTON
Y.
1st
Floor, Kentucky Homo Ltfe 'Bldg,
LOUISVILLE 2,, KENTUCKY
STREET
Long Distance 238-9
6-8100
&
Street;
offices at
Mr.
15
Broad
Co.*
City, effective Nov. 21.
McKenna
in
was
&
McKenna
Engeman
was
&
Circular
the
materials
.
years
to
employment
with
and
full
duction
in
—
to balance with
production sched¬
and
material
availability;
balancing prices to the markets,
and re-oriehting distribution to
.
ules
that
the shifts in markets that have
m
curred
accom¬
J. D. Small
so
h, "so
<
Quickly, in industrial
u c
Scott, Horner &.
Mason, Inc.
workers who
Lynchburg, Va.;
bell system teletype su 464
Federal Street, Boston 10X
'Tele. BS 128
Company
ESTABLISHED 1899
Salt Lake City 1, Utah
*
LD U
An address by Mr, Small be¬
National Industrial Confer¬
for
;.
Eastern Corporation
BROKERS and DEALERS
Retail New England Coverage
No. Indiana Public Service Co.
UTAH MINING
./:/
•
•
■
Merchants
Memos
Bank
and
Insurance
Inactive
.
Stock
New
Exchange
,
77 Franklin
;
Street, Boston 10, Mass.
Tel.
Portland
Liberty
2340
Providence
Springfield
York,
Philadelphia
Los Angeles Stock Exchanges
Also Member of
F. L. PUTNAM & CO.. INC.
Members Boston
New
York
1420 Walnut
Curb
Established
and
Pittsburgh, Pa.
N. Y. Telephone—WHitehall
Private
Wire
1898
BROKERS
;
Stock Exchange Building
Salt Lake
City, Utah'
Teletype BU 67
'
•
,:
■
DES MOINES
1925.
in
being pro¬
are
duced at peak rates in many cases
and at prewar rates in most cases.
The laggard building materials are
increasing in production steadily,
and
we
have
hopes that they will
(Continued
on page
we are
va
in
2644)
,
/,
k
\
*
/,»./
-
,
;
w.
•
>ry*\
r.«,
an
period is ended, the most profitable securities will
be those that did not advance id recent bull market.
3-7253
and Los Angeles
achieved
Building materials
President, American Institute of Finance
"'
<
reconstrnction
Phone 5-6172
System between
Philadelphia, New York
high
while demand for goods in relation to potential
supply, is over¬
estimated. Sees better situation than after World War I and con¬
tends no justification for forecasting disaster.
Concludes when
Members Salt Lake Stock Exchange
Los Angeles
Hagerstown, Md.
,
all-time
artificial and abnormal period, Mr. Bancroft
sees need of a remedial
readjustment between various segments of
economy.
Says we continue to have much wasteful production,
W.H. CHILD, INC.
Exchange
Street, Philadelphia 2
New York
•
Asserting
Request
BUCKLEY BROTHERS
Members
Securities
prewar
By JAMES R. BANCROFT*
>.
>
Stocks
Industrials—Utilities
:
on
of the
Remedial Deflation Needed!
STOCKS
Distilling1 Corporation
exceeds
;
New England Markets
Secondary Distributions
that
20's and is only slightly below the
Board, New York City, Nov!
19, 1946.
TRADING MARKETS
rate
a
rates and the average level of the
ence
jiiiiiiiiiiiiiiiiiiiiiiiuiiiiiiiiiiiiiiiniii,
PHILADELPHIA
..
at
Most industries
fore
peace¬
New homes
permanent type are being started
have
completed the major plant
reconversion problems. Of
coursej
many" problems remain
to
be
solved, such as incorporating the
history. Construc¬
our
activity is at close to
time records.
displaced
were
160 S. Main street
Tele. LY 83
services in
tion
.
war
oc¬
war
Since V-J Day, we have achieved
the- highest output of goods and
:
transition
from peace to war.
American industry has absorbed
the majority of the veterans who
have
been
released
from
the
armed services and most ,of the
at the war's end.
'
during > the
yearj^.
These are not easy problems, but
they are well within the capacity
of industry to solve.
has
on
flow of materials in balance
a
the limiting material and
component; adjusting labor forces
shortages and
ti
into the peacetime produc¬
adjusting production
tion system;
pro¬
plished
Amalgamated Sugar
techniques, processes, and
developed in the war
new
country
goals of full
21 a
Light
in reconversion since
year
has practically
reached the
ever
&
our progress
to where we are today.
have plagued
us.
No other
edward L. burton
Waller J. Connolly >& Co., Inc.
Tel. Hubbard 3790
our
in troubles
■&/
Request
on
In
as
since V-J Day
Morris.
RR.
i:
briefly
difficulties,
Utah-Idaho Sugar
Bassett Furniture: Ind.
Maine
I would like to review
spite of all the
partner
a
Utah Power &
1 American fFurniture Co.
Preferred
•
a
previously
Dan River Mills
Prior
24
forming James McKenna
SALT LAKE CITY
"
J
are
LYNCHBURG
'iiiiiiiililiiiiiiiiiiiiiiiiiiiiiiiiiiiiiimi
&
Boston
i
Exchange,
Bell Tele. LS 186
Traditig Markets
B
Stock
Reimer & Co.
Teletype BS 424
Telephone CAnal
prices
year,
!
Harry R.
9, MASS.
HANcock 8200
N.
York
partner
•
and
With
Mr.
^ BANKERS BOND
i
or major work stoppages. Says 1947 is likely to be a ;
and full employment will continue although production
; may decline from present level. Cites major problem as labor- \
"management relations, and industrial unbalance as subsidiary
unfavorable factor. Warns there is danger to a free flow of rapidly
/ accumulating inventories, but decries need of central planning or ";
rigid controls. Concludes decontrol will require inevitable economic
adjustments creating jolts and strains to business.
away
good
•
I-. ♦'
«
..
b9th members of the
New York
.
"
.
t;
-
duty.
•:•••«
'
McKenna
Engeman,
Shops
Warren Brothers Class "C"
*
James McKenna & Co.
Ass'n
Murphy Chair Company
Parker Appliance Co.
Mr. Small reports present production at all-time record and prediets it can continue if the industrial boat is hot rocked by run¬
V-J Day and orient ourselves
; Consider H. Willett
Dwight Manufacturing Co.
Purolator
Turf
1
Berkshire Fine Spinning Assoc.
Naumkeag Steam Cotton
re4
was
American Air Filter
v.
Manufacturing Co,
1930,
active
v
Bates
since
Marine Corps after four and one-?
half
•
Co.]
cently discharged from the U. Si
LOUISVILLE
./
BOSTON
'•*'
&
admitted;; to ^general
.
£V-
By J0IIN D* SMALL*
Administrator, Civilian Production Administration
a
partnership-in the firm of Hautz!
& Engel, 57 William
Street, New
York City, and the firm name has
been changed to Hautz, Engel
$
Andrews,
Members
New
York
Curb Exchange;
T
1
Wall
The Production Outlook foi 1947
x
.
member of F. T. Andrews
has : been
Bayway Terminal
Now
Engel
Thursday, November 21, 1946
Foresees
competition, increased business mortality; and considerable
degree of economic instability.
more
SPARTANBURG
m
The current business picture leaves little to be: desired/ Controls
WHEELOCK & CUMMINS
TRADING
Southern
MARKETS
are
being removed, prices advanced, production is increasing, with
"
-
1
.
S'
demand stills
INCORPORATED
American-La France-Foamite
Iowa Power &
Bag & Paper
.
Southern Advance
Light Co.
exceeding tively, is living ibeyond his - means
and
supply. *
hardly any one, • literally,
wants to really iwork.
v The naughty
Textile Securities
AND
and
s
y
,
market
should
cer¬
(The American Institute - of Fi¬
nance
has found and continues to
find it difficult to believe that such
tainly be soar¬ a situation can develop into pro¬
ing. •
,y.
; tracted- prosperity, or that it can
Unfortunat2T be long sustained,
•:
•
• y V V:
ly that is not / It is the natural aftermath of
3.30% Preferred Stock
ti
unruly
stock
Properties
.
Common Stocks
,
"
Bought—Sold-—-Quoted
CO§
BOENNING &
EQUITABLE
DES
MOINES
Phone 4-7189
1606 Walnut St.,
BUILDING
Philadelphia 3
IOWA
PEnnypacker 5-8200
Sell Tele. DM 184
Private Phone
9,
to
PH 30
A.M. LAW & COMPANY
(Established
.,
1892)
all there
it.]We
spartanburg, s. c.
L. D. 51
an
American Box Board
Walt
Disney
/
Common & Preferred
Botany Worsted Mills
Empire
Southern
Empire
Cons. Rock Products
Gas
Steel
Pittsburgh Railways Co.
Cinecolor Corp.
Sterling Motor Truck
X
Warner
OSCAR F. KRAFT & CO.
530
LOS
Tel.
WEST
6th
2529
.
Tele.
LA
675
Telephone
RIttenhouse 6-3717
?!
SECURITIES
For Immediate Execution of Orders
or Quotes call TWX
Sp-43 on Floor j
of Exchange from--10:45 to 11:30 !
A.M., Pac. Std. Time: Sp-82 at
other hours.
STANDARD SECURITIES
Byllesby & Company
OFFICE
Stock Exchange Bldg.
ANGELES, 14, CALIF.
Trinity
H. M.
PHILADELPHIA
STREET
NORTHWEST MINING
James R. Bancroft
Company
Wawaset Sec. Co.
Phila. 2
Teletype
PH 73
artificial
CORPORATION
Members Standard
of
Brokers
-
Stock
-
Exchange
Underwriters
Peyton Building,
Spokane
Branches at
Kellogg, Idaho and Yakima, Wn.
war.
Similar conditions
ous
.
.
segments / o^j economy. This does not necessarily
economy. In many segments mean depression. But, to lay the'
abnormally high and fragile basis for an era of postwar re¬
price structure has been created.! construction, the' distoritions and
The economy is
characterized many of the artificialities in the
/
our
an
by marked'price disparities among current situation have got to be
groups
of commodities. remedied—and they can only be
There
are
psychological malad¬ remedied through a period of re¬
justments reflected in restlessness^ ad justment/iy:/./yvVy'/.,y;v:
:;t '/•
various
industrial strife and low labor ef1
Industrial output, measured by
ficiency. The cost of living is rising the Federal Reserve Board's index,
constantly;
every
one,
Spokane
Dealers
all-out
abnormal
and
SPOKANE. WASH.
an
in have existed following all previ¬
major conflicts!.
» >' >
/.••In the opinion of the Institute
period. A r t i* what we have got to face, before
fic i a 1 props
long, is a remedial readjustment
support / some between various segments of the
Teletype SPBG 17
N. Y. C.
COrtlandt 7-1202
LOS ANCELES
is to
are
*An
before
address
by
Executive
Chamber
of
Mass., Nov.
Mr.
Club
of
Commerce,
14, 1946.
figura- unadjusted for seasonal variation,
declined from a war peak in the:
Bancroft spring of last year of 235 to a low
Bostori
Boston,
of
148
in
coincident
February
with
the
of this year,
steel
strikes
1
(Continued
on page
2646)
h.
.Volume
Number 4544
164
THE COMMERCIAL & FINANCIAL CHRONICLE
Marketing Outlook in 1947
i
Clear Way for Court
Test of 168% Margins
By HARVEY S. FIRESTONE, JR.*
President, The Firestone Tire & Rubber Co.
Holding crying need js production,: Mr. Firestone
"boom and
a
says
*
bust" in 1947 is possible if increased manufacturing costs and lower
V '
man-hour production force retail prices up so high
public cannot absorb output. Contends if re¬
occurs, it need not be either severe or
prolonged, and present marketing outlook is favor¬
able! Cautions against excessive inventories* and
sees gradual return to normal conditions industry
by industry. Cites three essential factors: (1)
efficient production by labor and management;
(2) a favorable environment for business; and
(3) success in developing new and better products
directive
cession
questing
<1;;
H. S.
trading,
way
lest
somewhat
reminded
which goes:
f
■,
■
■■■
I
of
in
called
am
a
the
role
<
v\ !*viIif.*'■' 1:$^.1!../•!'-''V3
oracle
an
to make
upon
written
verse
of
by
and
<
nothing
is
Reserve
to
way
some
fight.
a
a warn¬
For, as a
matter of fact, our economists are
-""An address by Mn Firestone
National Industrial Con¬
before
New
York
City,
fight' mbre often than they
-
rule
the
the
enforcement
Federal
prohibiting
margin
•
f
Therefore, this evening1* J shall
(Continued oh page 2641)
' •
More
specifically, it is his view
member
houses requesting com¬
pliance with the Federal- Reserve
restrictions
'on
margin trading.
The; position: which this gentle-
Back to Normal
.
takes
executive, ascribing rapid rise in life insurance
lower purchasing power of dollar and to war-time
to
^monetary savings" of public,predicts • arreduction
I
in business
-
Holds conditions promoting- recession, are!; ••
(1) unfavorable labor situation; (2) high costs and prices; (3)
mounting inventories; and (4) a; .dark railroad and construction
outlook. Sees possibility of solving present problems, and
*
ing
single exception, and that not an agency one, the re¬
years upon life insurance were all to the good. The
dompensation'3.
. <$>agents
creased;
.
in¬
definitely
their'
should
I
the
future.
I
wish
truthfully tell
thought
this
is
what
you
you
courts, this
be
tested
in
he
ing such' a move. The securities
industry never should have per¬
k result of the
The
jn
.
I
persistency of
war as
Continued
on
page 2642)
•
wide
-
dark
of
economy
per
an¬
I
>
num.
this, in the name
is
lies
whom
the
make it
^
average
to
Stock
receive
margin accounts
;
Exchange
as
came
on
from
its books and
2 3,4%
(Continued onpagev2664)
\
-
favorable.
though the
of
fortuitous
is
the
a
lot of dead wood
agencies
and
it
responsibility
of
ment
to
back
in \again'• too
I
that
see
have
no
it
certainly
:
does
not
soon,
doubt
and
on
a
we
can
continue
1946.
the
Republican
,
Telephone &
that
y-'A-'-
,
^
S
yJ ^1
I \ ^
+
\
i.
on
'
v
3
,
'
*
request
British Securities Dept.
Xu-t
,
!,
^
„v V
V
SOLD
—
«*
^
° '
—
-,1
QUOTED
*>c x1'
\
-
t
* v
^
^
^
-
j
New York Hanseatic Corporation
120
BROADWAY, NEW YORK 5, N. Y.
Telephone: BArclay 7-5660 '
Goodbody & Co.
'
'
Teletype: NY 1-583
Members /V, Y. Stock Exchange and Other Principal Exchanges
115 BROADWAY
NEW YORK 6, N. Y.
Telephone BArclay 7-0100 <i
Teletype NY 1-672
,
Sttllivan-Waldroit Producls Company
get
COMMON STOCK
today,
STATE AND MUNICIPAL BONDS
CORPORATE
Manufacturer & of the Nationally Known
BONDS-
profitable
LOCAL STOCKS
t§
PROSPECTUS
V.'-
'V*,
•;
'S../
,
■
't^ v"
ON REQUEST
1
0;
:,T;.. ' vVs,:':'
-V;
v';-
confidently expect it
somewhat as is, in¬
address
Insurance
sociation,
1943,
Convertible Debentures
BOUGHT
i,
by
Mr.
Benner
Established 1894
Management' As¬
Chicago,
111.,
•
-
Nov.
:
12,
:
■
F. H. KOLLER &
Members N. Y.
before. Annual Convention of the
Life
in
under
the leadership of
Senator Vandenberg and Senator1
Taft, held a meeting at Mackinac,
V;, (Continued on page 2652)
Prospectus available
:
•*.'4 *An
>,4 '
Scopjiony, Ltd.
basis,
ever
before, you are all
hoping that the present situation
can
be regarded as normal and!
that
*
'*
;
easier to put new men in the busi¬
to
1-
manage¬
With the sal? of insurance break¬
ing all-time records and with it
ness,
than
Party,
'
circum¬
is
our
-y
.
had
war
beyond the scope of
this paper to discuss. But, this
much is certain, the war years
in
'
It
How much management was
responsible
for
these
improve¬
ments and how much
they were
did clear out
*
(when issued)
ago.
stances,
\
RHODES-HAVERTY
BLDG.
Teletype AT 288
111
ATLANTA
1,
GEORGIA
Long Distance 108
CO., Inc.
Security Dealers Ass'n
BROADWAY, NEW YORK 6, N. Y.
BArday 7-0570
in-!
American World Participation
t
Gaumbnt-Brilisli
'
;
almost
result
: v
are
Subscription Rights
agency system some six years
the
while itli
Telegraph Co.
the
Claude L. Benner
all the complaints
that the TNEC had made against
our
So,
and
ex¬
seem
poverty.
separable.
of Adver¬
American
Rliodesian Selection Trust
ist, and morfality; was
very
cured
sinks
angry
firm
almost
would
world, in this'
further into sulleni
Due December 15, 1961
until
to
prosperity if
the
of
atj
tising Agencies, New York City,
Nov. 18, 1946.
surrenders de¬
ceased
rest
Back
kind of a fight," he thinks.
Fully 30% of" all the income the
of
children will en-i,
home, the two problems
by Mr* Luce before
American Association
|
got
we
is first of all essential that Amer-j
ican business should succeed
it is only with the aid of the
*An address
ours.-
have
our
and
applied, -in the - fullness of
time, to the world. And believe
good;
lapses and
they
chance
period,
of
For this is the American, dream
:
proportionately
raise
peace or
the
with
now
me,
world
we
must;
of the
economy
joy neither
or
..
more
In any case we
knows that
power
true.
come
$200,000,-!
and
achieving this goal? In the United
States, a good chance. But I think!
every
American
instinctively 1-
this dream
greatest
will either to reject
was
clined
What
not
America
of
than
more
wholly
within your power to achieve this
goal. It is a task, first of all, for
our statesmen.
But, next, it is the
businessmen
S.
$300,000,000,000 for the rest
of the
rest
it.
it
U.
help to raise the
dantly, and in order that they may
have liberty and learn to cherish
course
the
of the world.
that all
order
situation, in
than
peoples of the earth may have
bread, and have it more abun¬
Of
have set the
Roughly itj"
I
me
000,000 for
the
<;
tells
envisions not less than
business
And I ask
of the hu¬
fishly in order that my
man
}
goal too low by half.
sel-,
and yours may prosper.
for
plied;
wine-f
$500,000,000,000!
of
figure
expert
Henry R. Luce
ask
this
-
first
the
across
represents, I confess, no very ex-;
haustive calculations. At least one
$500,000,000,000
Phoenicians
sea.
The
than
more
some
used
real estate or the ease with
triremes
with the 100% rule without
away
is the "boom
business
the
their
mitted the Federal Reserve to get
Of life insurance is just as much
and turnover ;
since
a
create
world
a
to
the
believes, though
not. say his own firm
man
would take' the initiative in mak¬
pot, The present boom in the sale
.
does
■.
•
Sure¬
ly, therefore, this is the most im-|
portant opportunity that has ever
come ta the race of businessmen!
all free enter¬
in
.
American
this
of
nobler future for mankind.
and
resolve
you
dream
that the specter of tyranny,
bru^
tish and squalid, will be swept,
away
from the world and th©
doors opened to a happier and
join
me
to
;
I-
and scale of the Amer-i
tonight is not for
scope
put
power
late
to
not
prohibition, he con¬
view, a 99 % margin
would be legal but a 100% mar¬
gin is not. 1 The Federal;Reserve
pan reasonably expect. But, Lean*
margina 11 producers
dropped out,
the
11 could
that
high;
low.
in
that
average pro¬
duction
was
was
intended to give
one
pf the war
.
Of
is
rule
With
never
tends. In' his
diets if business recession & properly handled, foundation will be
sults
Congress
holds. Regulation of margin trad¬
laid for extended period of prosperity.
;
member
the Federal Reserve Board power
to
abolish
margin
trading,
he
pre-
_
a
Stock, Exchange rule to contend
:
generally in 1947.
.
if
serve regulation
prohibiting mar¬
gin trading it would still have the
'3 Life insurance
sales
even
Seek
Vice-President, Continental American Life Insurance Co.
*
that
house could; through legal action,
release from the Federal Re¬
By CLAUDE L. BENNER*
.
is
I
Willkie, I ask
for
that the New York Stock
Exchange
should cancel itsdirective on its
American capitalism-
on
<S>
spirit
the
you
Reserve
trading.
nomic progress of. our country,
:
as
for
Board's
many" ; important
contributions
which they have made to the eco¬
Nov. 19; 1946. '
acting
agency
proposition
great Wendell
to* remain
are stop
wrong and businessowes: them a
real
debt of
gratitude; for the
the
of
prisers
anonymous
has
come
forth with the suggestion
that the New York Stock Exchange
am
indictment*
Board,
fers
The
billions.
with
get
Holds Britain depends
try not to underestimate the
economy.
i 1 lions but
In
JA broker in one of Wall Street's
largest financial houses who pre¬
so
is, I
sure, meant to be more of
ference
I shall
ican
;
demonstrate that that free
must
we
j
Says struggle is be¬
development.
Advocates American ideas be promoted by our foreign services.
for
power to abolish margin trad¬
ing. Thinks brokerage industry
should, never
have
permitted
world
Russia and U. S. and
enterprise works.
m
Believes Congress
intended to give Board
technical skill to
tween
pave
any firm so inclined to
validity of Board's prohibi¬
kind of
-
',i This able observation
an
Exchange would
•with 100% rule without
every
true as statistics and facts
Except the destruction they leave in their tracks "
ing than
the
margin
for
Federal
prediction, I
T. Hubbard,
a
Samuel
with
on
and
;
"There
„
,
t;
"
re¬
never
The subject assigned to me is "The Outlook
for Business from the Standpoint of Distribution
and Marketing."
That word "outlook" casts me
Firestone, Jr.
always
••
ery,
tion in court.
;
time
am
i >l'.t*
compliance
Reserve Board curbs
>
v!\\J. V.1.
member houses
on
By IIENRY R. LUCE*
Editor and Publisher, "Time" and "Life" Magazines
,
Leading publisher, in urging American participation in world recov¬
advocates $500 billion world economy, of which U. S. should
contribute $200 billion.
Holds peace and prosperity are impossible
in poverty stricken world, and advocates
applying American capital
of V/all Street's
suggestion that by canceling its
that
•
one
v
largest financial houses advances
»
marketed at low prices, f
Partner of
Bread and Liberty
v
,
2607
NY 1-1026
mi*
Thursday, November 21, 1946, (
THE COMMERCIAL & FINANCIAL CHRONICLE
2608
■
ciation, thus sharply scaling down
Economic Stability:
its
High Output
Public
By AMOS E. TAYLOR*
Utility Securities
Director, Office of Business Economics, U. S. Dept. of Commerce
Holding high output and employment is an international problem,
Dr. Taylor points to need of v/orld-wide economic stability to main¬
tain high production.
Says present problem is to see that private
markets absorb goods and services formerly devoted to war,
through promoting higher living standards and expanding markets.
Advocates large volume of foreign trade, and lauds proposals of,
International trade Organization as well as Bretton Woods instituInternational Trade Organization and Eretton
Woods institutions.
significant that in all our efforts to effect an orderly transi¬
tion from a wartime to a peacetime economy we find ourselves
directing pri-3>
:
—
mary
att.en- mind by calling attention to sev¬
eral basic figures.
tion
to
the
Now that we
maxim um have accomplished what several
years ago seemed impossible by
possible pro¬
duction
of gearing our economic machine up
goods and to annual output, which at one
It is
approximately $206
naturally have good
to
economic reason to look upon that as an
The sig¬
stabiltiy, na¬ early peacetime goal.
services
time reached
the
on
billion,
hand, and
one
we
tional and in¬
nificance of such an objective can
ternational,
best be understood
on
that
1940
in
by bearing in
output of
New Utility Stock Offerings
industrial
companies, but because of different profit margins and
growth rates for different industries and different companies.
Thus
U. S. Steel sells about half its book value—while the
of
plant account about 70%) the in¬
dustry has been overly competi¬
ity
for
tive
other
abnormal
low.
are
find
we
book
the
market
railroads
the
to
real¬
that
high
come
Amos E. Taylor
ize
also because
not
us
were
before
of our
more
the
own
war
that 1 the
remains
results
were
a miracle.
.
is however not the whole
has nothing short of
.
conscious than
This
we
the potentialities
of
be
peacetime conditions, the fact still
of the fact that our
during
experience
made
who would
employed under ordinary
included many people
sustained 'production lies at
the basis of a sound economy, but
and
story.
Behind all
•:
achieve
economy.
to
and
our
efforts to
maintain
new
peacetime objectives in produc¬
tion and employment lies the fact
vk*Ari address by Dr. Taylor at that the virtual breakdown of
and
international
the forum of the Economic and both national
I can
illustrate what I have
Business
Foundation
N
of
in
e w
Wilmington, Pa., at Youngstown,
economic systems during the early
30s
has
made
us
continued
O., Nqv. 14, 1946.
especially
on page
2638)
con-
value.
So
far
book
concerned,
meaningless.
deal
one-third
of
dollar
(industrial business).
substantial
It
sions
the rate base.
as
(In
case
conclusions
of last
year,
take
and
regardless
Hence,
cuts
the
are
is backed
of
a
by
dealers
experienced staff—in charge
an
working partner—that is in close contact
invite you to put
we
been
making in
formation
or a
.
we'll do
.
we
under
is
in
or
"No Deflation Threat
In Debt Retirement"
Treasury surplus
checking inflation.
repro¬
a
of
result
Book
Value
Chicago,
told
Mid-Con-;
the
t i
&
of
Bankers Asso-
at
ciation
Chicago on
Nov. 8.
|if I
'
Mr.Langn
John k. Langum
said, "One
m a j or i
problems we have is working out
an
appropriate budget policy.um
of the
36
$18.00*
9.69 k W/mM
36
17.70
53%-
41
Some
10:84**
35%
33
of
17.39f
41 y4
34
surplus,
5.00
.
22 y2
17
business recession and depression
None
$8.50 ;
<
10.00
k
Ohio Edison
27
$Before plant acquisition adjustment of $7.13
**Plant is carried at cost to company and
includes write-ups over cost to previous owners equal to $2.90 a share.
Approximate.
&Gas
and
need to have a deficit."
contended that cur¬
States should
United
the
rently
sharp.
of
times
in
a large surplus as a means
checking inflation. During the
have
;
period of high business
activity, we have had more debt.,
retirement as a means of checking
common
pointed out there are limitations
early debt re¬
to the possible
as
tirement, the three most important :
Light common
being: (1) the cost of the servicing
Southwestern Public Service common
Bought—Sold—Quoted
But he
inflationary pressure.
Light common
Birmingham Electric common
Carolina Power &
affairs
fiscal
current
TRADING MARKETS
Federal Water
the
government we need a big
Mr, Langum
of
Delaware Power &
in
times
our
we may
which is being amortized.
.
t Trust
7.00
>
Electric^-
Dayton Power & Light
part!
11 e n
Conference
the American
connec¬
Market
Price
Re¬
Bank of
serve
very
Offering Recei
-
of the
dent
Federal
operations, to
set aside huge reserves for plant
revaluation and increased depre-
Columbus 8c Southern Ohio Elec—.
teletype
of
means
as
8.00
Gas
of
large unless national
Urges large
reduced.
debt is
tion with refunding
have
one
tributing factor.
from the Public
Commission
require special in¬
just phone, wire
our
result
pressure
Service
Consumers Power
advertisements to the
particular security for
your customers,
.
our
the claims
The next time you
test.
us
implemented by action—
buyers to buy some
issues may have been a con¬
utility common stocks. To
recent instance, Consol¬
this year agreed,
Par
*
Words must be
stitutional
Edison
':i Value
Cincinnati
the reported hesitancy of some in¬
new
even
or
The
Scranton Electric
with all markets.
so
a
idated
were
without
to you
than
substantial decline in book values
bf many
mutual
Few profitable-cooperation between in¬
businesses are built
dividuals. Our offer of service
costs,
reserves.
few cases,
a
tabulation available for rate base
rate
average yield
seasoned issues, and
higher
a
on
the past decade have been written
heavily, both through write¬
offs
and
increased depreciation
figures
public, but
more frequently this is not done,
and there is certainly no uniform
the rate base
whether
sell
down
in the celebrated Pennsylvania
figures.)
previ¬
ously pointed out in this column,
the new issues have continued to
„
plant account is usually
Light
important fac¬
were an
In any event, as
A great deal of the adjustment
paid-in
being made in this country as a
costs to the company, but insist on
result of the increased money sup"original cost when first devoted
ply and public debt may have
to
public k service."
Sometimes
already oc¬
they also require large increases
curred, John ;
in depreciation reserves.
K. L a n g u m,
Thus utility plant accounts in
Vice-Presi-
_
as
definite
longer recognize
no
duction
the public's only convenient gauge
of the mysterious figure known
on
number of state commis¬
a
sions
an
allowed on a fixedformula rate base—but neverthe¬
Power &
market
general,
because
conditions
will remain
capital. Formerly, the
could occasionally be re¬
valued at "reproduction cost new
arithmetic—a fixed percent¬
net
mine,
plant
return
less
"going
less depreciation," but now, at the
insistence of the Federal Commis¬
true, of course, that rate
regulation is seldom based on def¬
age
is¬
new
John K. Langum of Chicago Re-'
serve Bank holds
liquid assets
the
on
of
amount
down to a moderate allowance for
is
inite
of these
some
received is difficult to deter¬
working
sales
base, book value becomes
important factor.
great
to what
In
as
years
value," but this has been whittled
Because of
return"
basis of "fair
recent
a
the commissions per¬
engineering appraisals of
utility plant accounts to include a
profits, is rather closely regu¬
lated by the State Commissions on
rate
in
narrowed
mitted
the fact that residential business,
which contributes heavily to net
the
have
the old days
of
utility stocks?
Here
we
have a closely regulated in¬
dustry, yet one which enjoys a
constantly increasing sales vol¬
ume, with competition limited to
about
tion which
constitutes 'tangible" property.
important is book value in
case
rate
concession
a
A
factor in the rather poor recep¬
a
sues
basis
Ideas
,
ing that "fair return" might be insufficient in the future to sustain
the
dividends
and the
current
market values.
Whether this was
tor also.
the
as
the
—
frequently
important; and in the great
maj 6rity of cases our best guess
of such a figure is net plant ac¬
count, excluding intangibles.
Central's
\
that some institutional buyers have been disturbed f.
by the very low book values of
some of these utility stocks, fear¬
mains
nine times
or
are
are
How
eight
new
of these issues:
by the company to obtain com¬
mission approval of a refunding,
recapitalization or merger — the
theoretical rate* base figure re¬
periods) earnings
that New York
value is
lowing for some rise in prices and
for the fact that the labor force
be¬
have
cut being
Thus, in spite of gov¬
regulation of accounting;
ernment
commission
the
and
same
true with respect
stocks, as transporta¬
tion is a highly competitive in¬
dustry and (except in wartime or
values
cause we
The
years.
seems
voluntary concessions by util¬
companies, or the result of
bargaining between the company
railroad
to
goods and services stood at only
about $97 billion.
Even after al¬
simply
many
situation
mind
our
company's ac¬
considered^-
are
for
It is reported
general the Wall Street analyst does not regard book value as
important factor in evaluating common stocks; this is not
merely
because of the wide variations in accounting standards for
is
not
Handicapped
In
counting methods
evident in
figures
utility stocks offered to the public
this year.
Following its compari¬
son of par value, book value, offering price and current price for
very
conservative (it has written down
value
book
some
the other. This
true
the
|||'' By Low Book Values?
a
stock book value.
common
This situation is also
the debt;
of
.
and (3)
j
(2) aid to .veterans*
the military and naval ex¬
penditures.
'
Paine, Webber, Jackson & tens
ESTABLISHED
1879
o
"If
good business ac¬
have
we
tivity, we can have a substantial
retirement
of
?
the
debt
with
no
;
deflation," he said. .Mr, Langum
added
68 William
Street
Telephone HAnover 2-1700
*
NEW YORK 5
Teletype NY 1-993
201 Devonshire
Street, BOSTON 10
that problems in the
cur¬
rent
sult
Consolidated Elec. & Gas Pfd.
monetary situation will re¬
from
the
policy-which has
departmentaliz¬
been followed of
Federal Water & Gas Com.
ing the debt into government se- |
.
Members New York Stock
Exchange
Hallicrafters Common
New England Public
GOVERNMENT,
PUBLIC
MUNICIPAL,
curities for different types
Service Pfds.
RAILROAD,
INVESTMENT
STOCKS
short
maturities
commercial
UTILITY, INDUSTRIAL BONDS
AND
vestors, saying: "The low
Gilbert J. Postley & Co.
29 broadway,
:
*
.
■"•••
!*'.V;
*
•
v.*
view
ments
of
new york 6. n. y.
Direct Wire to Chicago
in
of
placed
with the
the
nation,
alternate
invest¬
banks
the
of in¬
yields on
of
possible in other obligations
political divisions of the gov¬
ernment and of business, may cre¬
ate
difficulties."
•
;
J }■
Volume 164
•#v- ■'
t, /"j.
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4544
-i*v;v'' '■•
/'
The CIO and
Y'Y
;
.
'
.
.
;YYY'';
V'-.';/'
,
By J. HOWARD
President, Congress of Industrial Organizations
.
_
World Oil Outlook
Wages
Ry PHILIP MURRAY*
after reviewing recent strikes, which he ascribes
of price controls as nullifying recent wage
increases.
Refers to government report, repudiated by the Commerce Department, in which it was
held industry could advance wages 24% without requiring price increases, and asserts corporation
profits are now higher than ever before and are a menace to a free economy.. Decries fears Repiib- "
fi lican victory will lead to "crucifixion of labor" and
hope Powers v/ill
expresses
'
by United Nations will put American industry and foreign trade
strait-jacket of government control.
Denounces inter-govern¬
mental commodity cartels as destructive of free
enterprise, and criti¬
cizes AngiooAmerican Oil Agreement as
leading the camel's nose
Peace.
agree on
give expression of heartfelt appreciation to the delegates attending this convention for
the warmth of your greeting here this morning.
This, to my mind, will undoubtedly prove to be one
of the most important conventions ever had in the history of this great movement, and it will prove
a
fied
gard,
conven¬
a
certain
organizations
must
Industrial
Organizations.
t : The
tion
doubt,
it
in
are
(Continued
on
page
Philip Murray
manifold
problems which will undoubtedly
be presented to it in the
course
Holding
of
convention
a
Congress of Industrial
of
the
Organiza¬
the greatest parliamentary
body of workers anywhere in the
entire universe. The record of our
organization,
together
with
its
constructive considerations to the
questions which have pre*'
many
themselves
to
it
in
the
of its career, demonstrates
the fitness of our organization to
course
arise to the needs of any occasion.
And, of
this Eighth Con¬
course,
our
stitutional Convention of the
Congress of Industrial
we are
in
necessarily
V- ;;
Organiza¬
considerations
concentrate
In
that
of distance
matters
through
of
it may not
juncture
state to the convention that, with¬
out
doubt, the most important
consideration
to
be
presented
at
me
in
peace
and
It
\
is
of
We, like¬
wise, can re¬
?
wage as¬
pects of collective bargaining de¬
liberations that
bound to
are
conferences
of
many
fabric
a
being
for
f 1 y
Strikes
his
might point out, in that re¬
strait-jacket !for
]
a
world trade.
Not
all
threads
the
are yet in
place, so none can speak with as(Continued on page 2636);
ap¬
the
In¬
James G. Holland Joins
S. R. Livingstone & Co.
J. Howard Pew
better
(Special
to
to
The
Financial
DETROIT,
Holland
with
and
great
and
S.
become
associated
Livingstone & Co.,
Bldg., members of the
New York and Detroit Stock Ex¬
changes.
Mr. Holland in the past
was
with
McDonald, Moore &
technology has advanced to Hayes, Inc., and conducted his own
heights undreamed of a dozen investment business in Detroit.
years
ago
and
promises
even
greater achievements in the years
forseeable future.
-
Our
ahead.
Our
With Charles E.
show pros¬
markets
(Special
pects of steady expansion as long
as
,we
continue to provide con¬
Soma
with top quality products
reasonable prices.
Most im¬
sumers
at
to
The
is
Bailey
Financial
DETROIT,
MICH.
Chronicle)
—
with
now •
Anthony
Charles
Congress of Industrial Organiza¬
ambition.
viding units
and
of
indirectly to
intensifying
directly
revolutionizing
destruction
members of the Detroit Stock Ex¬
portant of all, our initiative
and
spirit of competitive enter¬
prise burns with undiminished
change.
our
•
.
\
i
(
...
...
.
at
(Special
to
The
Financial
Chronicle),
Mr. Pew before
to possible by a superior technique
always and a more effective production
We have effort. Thus we see how different
power
of
(Continued
2622)
on page
♦An address. by Mr. Sloan be¬
fore
great
26th
Annual
Meeting
and at low first cost and expense
iil.,
Chicago,
of
H. HENTZ & GO.
Institute,
stocks—bonds—commodities
Nov. 13, 1946.
Established
■
November 15,1856
t
s'
OFFICERS
,<
•'
y '
Y.'
•
<•
«
H
•
■
,
V;V
V.
■
After
American Securities Corporation
?<
V
* yo.fy
^ ) • •'
k,
•
'
,.4.'
'
-
to
Y
:Y.
(1
/
YcYY
yv./.y'1'1-''
'i
..
s'
/k'
i
-
V
^
"
t'
Frederick
x*-
;
'-v*
"
'
rY
x
'I
v
1
/ '
'
M
v 1 ■'
'•
,r\
'
•
*
*
opening of its
new
New York Produce
i
25 Broad
i(
his fellow
>
,
as
,
\ -'Y Y'
N '
v
.,
•'Yv
V Y-
it could be done
to
have the
men f9
■
•
i
New York' Cotton Exchange
New Orleans Cotton
Exchange
Ex., Ioc
Exchange, Inc.
Winnipeg Grain Exchange
■}
Chicago Mercantile Exchange
Canadian Commodity Exchange, Inc.
Liverpool Cotton Association, Ltd,
Wool Associates of N. Y. Cotton
New York Cocoa
Exchange
Chicago Board of Trade
Chicago Stock Exchange
;Detroit Stock Exchange
Boston Stock Exchange
Street, New York 4, N. Yt
New York Cotton
David Malzman
;
mil
by others, better if possible, and
Hanover
,
as
Commodity Exchange, Inc.
New York Coffee & Sugar Ex., Inc.
offices at
Vice President
Secretary
Y Y
" ^
MEMBERS
r
y
}
New York Stock Exchange
New York Curb Exchange
.-■■■*
fi. Terry y
Emdon Fritz
'
k
Vice-President J Treasurer
Y--'V
*'
Announces
the
;
'
•
Executive Committee
1.
**»
'
Elmer O. Diefenbach
Chairman,
'
respect of
President1
a
steadfastly
H. Hentz & Co. hold
"To do business
CORPORATE AND MUNICIPAL SECURITIES
y
of continuous operation under
name,
the fine tradition of its founder:—
Y
of the. 'Board'*-.
Charles G. Terry
vru
90 years
single firm
'
Underwriters and Distributors of
William Rosenwald
Chairman
Exchange Building
Square, New York
,
.
Telephone: WHitehall 3-6454
;
■'■y
'"""I
-
■
-
With Herrick Waddeli
♦An address by
man
flexibility and broad application American. Petroleum
vention, Atlantic City, N. J., Nov.
18, 1946.
T!
<
E.
Bailey & Co., Penobscot Building,
—
available to man every¬
where mechanical power in sub¬
stitution for human effort by pro¬
tion's Eighth Constitutional Con¬
1
t- G.
R.
Penobscot
Chronicle)
MICH:—James
has
We have contributed both
im¬
made
by Mr. Murray at
vy■ ;y^
and
woven
November 21,1946
.
TAMPA, FLA.—John W. Chamof making
it sea, on land and in the air in times the American Petroleum Institute, berlin is with Herrick, Waddell
& CO., Inc./:;A;:
possible of war. But we have made victory Chicago, 111., Nov. 14,1946.'
YV
Alfred P. Sloan, Jr.
convention.
♦An address
tact
portantly
to
the technique
of
-organizations
following the adjournment of this
Recent
become
may
tory. • We have, without doubt,
ample crude supplies to meet all
domestic
requirements
for
the
operation.
We have widened
the horizon of observation, con¬
trans¬
tributed
en-
international
Reviews
by
agreements
,
.
or
cast
now
in discussions and proposals which
fulfill the opportunities of the fu¬
ture than ever before in its his¬
of
indi¬
that
shadow
a
international
undertakings,
the
over
industry cherishes; for
our
many more
years
of continued
service to the American
people.
-
this
will be the economic
in
which
both
war.
the
our
V.: Y>
."tJJBBI "
■'
I
understanding of our
Our heads are unbowed.
With Garrett-Bromfield ■
portation. ^As people.
We have stimulated the fervor.
a
>'
by-product redistribution of peoples with re¬ We remain unconquerable rugged V (Special to The Financial Chronicle)
of our efforts sulting social and economic gain. individualists, and of that, we are
DENVER, COLO.—Rexer Berndt
and our tech- We have created employment for proud.
;
I
is now with Garrett-Bromfield &n o I
g i c a 1 millions at high wages.
Hardly
Appearing also on that horizon, Co., Security Bldg., members of
progress over any
individual, industry, com¬ however, is a shadow with po¬ the Chicago Stock Exchange. •
the years, we munity or nation has failed to feel tentialities of evil that threatens
the impact of the automotive age. to destroy all the bright hopes
have con¬
vidual
regard
for
years,
equipped
-
outstanding importance;
amiss
50
is
Through our industrial efforts and their effective coordination
of industries has made man, for the first time, largely
V Y independ e n t ——
—1
it5
upon
world of great confusion, Mr. Sloan stresses
a
group
tions, like preceding conventions,
will
take justifiable pride in the
progress,
the record of public service which
ternally our
industry today
Says pressure
groups, supported by political considerations, now prevail, and loss
of economic freedom threatens our political freedom. Contends
management should no longer limit itself to production, but should
accept challenge of broader leadership.
Reviews conditions in
auto industry, and predicts present year will be profitless. Holds
attainment of sound economic relationship between wages and
prices is principal problem, and unless settled, business uncer¬
tainty and recession are likely to continue. Views recent election
as opportunity and not a victory for business enterprise.
as
Rented
can
last
.
morrow,
need for1 political statesmanship in economic affairs.
its deliberations.
regard
men
relations and
horizQn .of to¬
Chairman, General Motors Corporation
.
for Americans
has
the
over
pears von
By ALFRED P. SLOAN, JR.*
the
to
industry
joice
2650)
Why the Confusion?
consider¬
I
fields.
human
demonstrated
try
construe-;
ation
American oil
good
aright outlook
and
our
the
Wants equal opportunity
foreign oil development.
for our indus¬
tive
isue
in
the
statesmanlike
tions
mills, factories, shops, offices and
give
past,
I
of
part of 1945 and the early
part of 1946.
Following the ending of Japa¬
no
as
has
doing
latter
conven¬
will
in
nese
privileged to rep¬
resent our organizations in this titudes of men and women who
convention about the history of had during the course of the war,
the
CIO
wage
struggle in the been gainfully employed in mines,
Congress
f
so
memories
the
refresh
who
those
hostilities in August of 1945,
industry in the United States, for
the most part at least, was re¬
quired to meet its peacetime re¬
conversion needs—to lay off mul¬
brief historical resume of
things that come to my
at the moment. In
mind
affiliated with
o
into tent of cartelization.
4>-
uni¬
tion of repretatives of all
the
Mr. Pew contends dark shadow
hanging over bright future of
petroleum industry is trend toward vStatism and bureaucratic con¬
trols, both national and international. Fears trade proposals made
in
I can't but
be
PEW*
President, Sun Oil Company
jj In keynote address at CIO Convention, Mr. Murray,
Y to managers of basic industries, denounces removal
to
2609
r;:
-
Uptown Office: 610 Fifth Avenue
CHICAGO
—
PITTSBURGH
—
DETROIT
—
GENEVA (Switzerland)
2610
THE COMMERCIAL & FINANCIAL CHRONICLE
'
Thursday; November-21y 1946
Detroit Brokers' Bowling League Resumes Post-war Activities
DETROIT, MICH.
ment
has
been
—•
made
Announce¬
of
the
re¬
pended operations during the war,
has now again taken up the
just to make everything strictly
official, the League has fulfilled
requirements for American Bowl*
ing Congress sanction.
>
sumption of bowling activities by 10-point sport, with the largest
the
Detroit
Brokers'
Bowling number of bowlers in its history.
The League; compos
League, under* sponsorship of the
of 114
Securities Traders' Association of five-man 'teams,
and Aplenty I of
Detroit and .Michigan.
lar
Griswold
Street
The
popu¬
league
sus-
capable
since.
It
operates on
Member, National Association
of Securities Dealers
Wholesale
Middle West
for
the
affords
low
an
;lhe
opportunity
bowler ;to
average
compete with the boys who
centrate
It
nstrikes.
o
Trailers' Association, as sponsors,
have appointed /&,: bowling com¬
mittee -composed <of Hay P. Ber-
j
Griswold Street firms who gather
cashiers, and bookkeepers of •nardi,
men,
'
together
:
For
once a week, on Monday
night .at 5 o'clock, .at the-Cadillac
UNDERWRITERS
SECONDARY
"Recreation
MARKET-
Bowling Alleys, and
a good time bat¬
ups-and-downs
CHICAGO 3
LOS ANGELES 14
135 La Salle St
650 S. Spring
Cfi 99
St.
'
State 6502
Michigan 4181
..y
LA 255
:
for match .games
bank
Wells-Gardner
&
Co., Com.
the
market.
Plenty of enthusiasm is always iin
evidence, and soLie of the .local
boys are even putting out "feel¬
ers"
*
of
with !riyal
challenges
to
Ray
P.* Bernardi,
Charles
C.
Second Team
While it
as
for
season
in
;
as
300 games
any
bowled, yet
to
creditable
already been turned:
—Cbe,
(Miller) 221.
•: Second Individual
High Game-Kuhnlein, Goodbody & Co.; 215.;
individual
HigH .3
C.
C. Roney & Co. (Wallace) 834.
Second
Team
High Game.
Goodbody & Co., 834.
Team High 3 Games—Goodbody
& Co., 2379;
tjv
-Second Te&m High, 3; Games^,
Wm. C. Roney Co. (Wallace) 2302.
.
High Game—:Wra.
.
,
labor
productivity, and points out the economic: problems created
by resulting larger output; of industrial products. Sees need of
:
to maintain equilibrium of distribution benefits
between labor and capital and adrocates preserving a balance
management
.
.Individual High Game
Wm.
^between values ■ of production and total effective buying\powert
Lays down prophylactic measures for avoiding maladjustments of
'
depressions, and urges changes in wages when needed to absorb
productive capacity.
Holds, though
;wage Increase may imr1:
piyarily reduce profits, in llong ruii it may increase profits by
enlarging markets.
■*
;
Games ^
Kuhnlein, Goodbody & Co., 589.
*SeismographServiceCorp.,Com.
mPro8pectus Available
Request. '
on
Paul H.Davis & Go.
Established
1916
Members Principal
Stock Exchanges
Chicago Board of Trade
Team
Captain
Wm, C. Roney & Co. (Wallace)
.
-
.
.
W.
Wm. Cv Roney & Co. (E. Miller)
McDonald-Moore & Co, (D. Miller)
L.
12
_
3
_
"
-
•
14
8
7
J3
12
11
10
'
Teletype CG 40S
Indianapolis, Ind.
Rockford, 111.
Cleveland, Ohio
___
________
SINCE 1908
been increased
621
tries
746
past.
10
''641
8
9
661
ination
8
.9
700
subsequent
8
701
embracing
facilities
7
593
8 >
"8* ' "
9
*
10
6
665
11
6
654
gr eatly- in
-indusr
s o m e
691
in,.: the
The
' .riodie
'
and
' '
'.i
" i
i
i
'
of
"
im¬
Central Public y
Utility
for
our
.DEEP ROCK OIL CORP. Common
-
-
r,
'
208
SOUTH LA
CHICAGO
Bell
H. M.
f
4068
CG
587
New York
r—:
State
8711
Philadelphia
Teletype
p1ttsburgh
273
speed
and
of
plant conditions
to .provide for maximum physio-l
logical welfare of workers, and
other known methoas of
address
Minneapoli'
by
Mr.
Gill
be¬
icdlly,
by
byj
Iron-j
the-employment
so-called
ciation, New York City," "NoV; 14,
workers to study ways to
(Continued
-.
*.«•»
». *.*•
*-'*
on page
acceler-
2625)
7
•
*-!»■
*•>
f.-f
?.',&$■
of
non-productive
more
.
byj
improv4l
.ng wor^er m0rale. In general
fore American Management Asso¬
%.
■
increase
consideration
•
*An
CG
to
by more oquitable grading of joc-;
cupations through job analysis;]
training of workers in superior!
methods
of
manipulation;
due-:
research and more research.
\m
i.: * » !
>.«
y-:.
fixtures
135 So. La Salle Street. Chicago 3
Telephone
Wire to New York
System
Byllesby and Company
Incorporated
4, ILLINOIS
1 Telephone Randolph
Direct Private
ST.
to
d u c e "
(productivity) wherever such
practices are applicable. They in¬
clude: enlarged use, of mechanical,
power; - development of processing
machines
toward
automatons; {
greater use of templates, jigs and
Brochure
SALLE
;per^
p r o
analyzing these Bonds.
raw
by
v
6% & 7% Preferreds
of
products;-
by subdivision of labor,
assignments •'more nearly in¬
line with natural aptitudes, and
achieve
power
-
INTERSTATE BAKERIES CORP. Common & Preferred
NORTHERN STATES POWER CO.
5^'s of >52 ,;y'|
Write
"
i
.finished
forrnance
ihent
"
■
movements
and
,
better handling equipment; stimu-;
lation to
greater personal.
tunity-: for
technical
and
materials
oppor¬
every
.
pe-
Texam-
p r a c t i c ally
limitless
We Maintain'Active Markets in
;-vy " *
f-,.
indicates
answer
which overall labor Ipro-'
10
7
8
700
711
• >
will
ianCo.L
Part of the
an-extension of those technical practices by
prove
Fred. W. Fairman Co
productivity?
{
prtecision of efforts, and unifbrmit^ of results; better design of
product, involving simplification,
and
elimination of/, uneconomic
varieties; the grading of raw ma¬
terials; (greater use of electronics
for the reduction of human effort,;
improved organization of plant,
7
8
Chas. A. Parcells & Co. (Quay)
8
Goodbody & Co. (Kauhl)___i..^->l__L-»7
Mercier, McDowell 8c Dolphyn (Walker)—7
Sattley--Baker (Bechtel)
L__.
7
First of "Michigan (Horn)
1
7
Crouse-Moreland j(Bader)
:_i,
7r
Cray, McFawn & Co. (Sutherland)
-6
C. G. McDonald & Co. (Stanko)
5
C/ G. McDonald & Co. (Allerdyce)
4
labor
'
.675
5
___
8622
712
6
-
How increase
Avg.
15
10
__
10 So. La Salle St., Chicago 3;
Tel. Franklin
Pts.
9
_____
Mercier, McDowell & Dolphyn (Porter)——
Paine, Webber, Jacksbn & Curtis (Buckley)
.
"
.
*Jessop Steal Pfd.
j!;
Mr.: Gill stresses .importance of technical Tesearch inincreasing
.
indicated below:
Wm. C. Roney & Co.
—
5•'
Economist and Director, Atlantic Refining Co.
be
some - very
have
scores
early in the
Game
Co.
•
By JOHN D. GILL*
.
hit
a
&
Roney
'i
Increasing Labor
Productivity
TEAM STANDINGS NOV. 5, 1946
Snap-On Tools Corp,, Con?.-
High
C.
Roney & Co. (Miller) 863.
Bechtel, and
Born, First of Michigan
Corporation.
trade groups (address all
or
Team
Clarence
Iiave'a whale of
tling ,each.other and forgetting the
DISTRIBUTION
this -group, -the Securities
to
com¬
is
Distributors;
Pacific Coast
tion
con¬
posed of partners, traders, sales¬
—
Cray, McFawn & Co., Treasurer;
Charles C. Bechtel, H. V. Sattley
& Go., .and Hay den Brown* W*/C.
Roney & Co., Secretary. In addi¬
handicap
a
—Brown, Wm.
(Miller) 552:
"Officials for the current seasbn
are: President JEtqy P.
Berhardiy
current season op .Sept. 16, and
has been going great guns vever
'basis and
CARTER H. CORBREY & CO.
commenced
subs,
Second Individual High 3 Games
Cray, McFawn & Co.). Then, too,
but
T;V<
-
t «T i-A St'l.trj
.Volume 164 v; Number 4544
THE COMMERCIAL & FINANCIAL
CHRONICLE
2611
Co., Inc., 40 Exchange Place, New
York 5, N. Y.
Dealer-Broker Investment
v
I Also available
data
are
:
Diebold, Inc.—Study of the sit¬
.
uation
—
on: Bar-
and
Ward
brochure
&
Co.,
Manufacturing Co.; The Com¬
Shearing and Stamping
Co.; General Machinery Corpora¬
New York 5,
tion;
Golden Crown Mining Co.;
Iliggins, Inc.; Highlights of Wall
Street;
O'Sullivan
Rubber
Co.;
Plastics
Recommendations and Literature
.i.:-t'
'V--
V
r'•v'•'v
T."V
It is understood that the firms mentioned will be
pleased
>v» rTto send interested parties the follotving literature: ') •'
American
\
Drug:
Industry—De¬ •—Merrill. Lynch, Pierce,- Fenner
& Beane; 70 Pine Street, New
tailed study in "Fortnightly Mar¬
ket and Business Survey"—E.F,
HUtton &
New
on
N. Y.
*
•-
-
i
V-*V
Petroleum
of
visions
on
Industry
—
Earnings
of
Memorandum
in
outlook
several
First
Utility
the
Fortnightly Investment Letter
•
brief
with
interesting
California
data j on
situations
;■
Company,
Inc.,
j Rangely Deposits
,
lenge to the barrage of pessimis¬
with
*
South African: Gold Mining In -
dustry—Detailed discussion—Hayden, Stone & Co., 25 Broad Street,
,and
capital appreciation—Strauss
Bros., 32 Broadway, New York 4,
N; Y.
—
National
Memor¬
are
memoranda
Northern Indiana Public Serv¬
ice Co. and Merchants
Corporation;
Corpora-
Distilling
Corporation.
New York 4, N, Y. \>
Co.
■-yv
■.-yyyy;;;v
'
'
■■
on
Argo Oil Corporation—Descrip¬
tive
circular—Seligman, Lubetkin
& Co., Inc., 41 Broad
Street, New
York 4, N. Y.
circulars
are
Public
N.
Y.
Co., 120
New York 5, N. Y.
V j Also available are
on
are
Chicago
Bank
Trust
&
:
.
;
National
Bank
Trust
&
•
and
The-
Gulf, Mobile & Ohio Railroad—
Analysis—R. H. Johnson & Co.,
on
National
memoranda
Corp.
Ralston Steel Car Co. — Circu¬
Lerner & Co., 10 Post Office
lar
—
Square, Boston 9, Mass.
f
Rockwell Manufacturing Cd.—
Street, New Y6rk 5, N. Y.
Rouse & Co.*
^
r Analysis—Steiner,
Hamilton Manufacturing Com¬ 25 Broad Street, > New York 4,
64 Wall
Asplnook Corporation—Circulai
&
available
The
Grand.
Company of New York—Analysis
—Geyer &
Co.,
Inc., 67 Wall
Street, New York 5, N. Y.
Muter-Co.
Tennessee Products and Wellman
Engineering. -' r '
1
—Ward
Street, Chicago 4, 111.
Also
Vv.
;
Building,
Co.—Analysis—C.
E.
Unterberg
& Co., 61
Broadway, New York 6,
Public
Salle
Street, Chicago 4, 111.
''r : "
Bank
Rapids 2, Mich.
'>•
Greyhound Corporation—Circu¬
lar—Hicks & Price, 231 South La
Cir¬
—
'
a
iisfc of suggested stocks for income
Salle
Recent de¬ J Also available
—
velopments^—Anaos C. • Sutler; &
Co.* First National vBank Buildihg,
Denver 2, Colo.
Guide to the Perplexed—a chal¬
statements—bulletin
I Also available
Co., 231 South
La
—:
,
New York 4, N. Y.
'
Eastern Corporation
Brothers,- 1420
Walnut Street, Philadelphia
2, Pa.
Precision
f American
Service
cular
Adams &
Outlook—Discussion
300'Montgomery Street, San Fran¬
cisco 20, Calif.,
* K
—
Fred B. Prophet
Company—De¬
memorandum—De Young,
Larson &
Tornga, Grand Rapids
tailed
n
H; Hentz & Co., 60 Beaver Street,
:
Materials
Creek
J
York 5: ,N. Y.
Effects of 1946 Income Tax Re¬
tic
Silver
Company, 61 Broadway,
York 6,
Broadway,
N.;Y. v;
mercial
;j.
products
andum—Buckley
calo
;\v;
of
120
pany—New memorandum—Loewi
& Co., 225 East Mason
Broadway
N. Y.
V-'-M,
Street, Mil¬
waukee 2, Wis.
memoranda
W. L. Douglas Shoe
Co.; Ilart-
Schenley
Distillers
—Brochure
! Hydraulic Press Manufacturing
fprd Empire; Lanova Corp.; Mo¬ Co.—Detailed Analysis—Comstock
! Abilib! Power and
Paper. Com¬ hawk Rubber; and Taylor Whart¬
The Market and the Railroads—
Co., 231 South La Salle, Street,
pany, Ltd. —• memorandum — Do¬ on Iron &
Steel; Barcalo; Haloid; Chicago 4, 111.
•
•
Excerpts from h talk by Arthur C.
minion Securities Corp., 40 - Ex¬ American Window
Knies
{Also available ai*e analyses of
Glass; I Puroat"}the B os t o h Public
change Place, New York 5, N. Y. lator Products: Upson
-Bell
Lumber
Corp.; Ala- Long
Library Under the auspices of the
Co.,
and
bama Mills; Diebold,
Miller Manufacturing Co.
Massachusetts" State Department
,Inc.;
of Education—Vilas & Hickey; 49
jAcro-Chemicai Co^—Ne^ memWall Street, New York .5, N.. Y. orahdum-^Greenfield, Lax & Co.,
(Automatic Alarm —•'Membr^ni
jlndiana Steel Products {CoV -L
Inc.; 40 Exchange Place,
New dumt-—Mitchell & Compariy.; 120
Memorandum on interesting situ¬
Ybrk 5, N. Y.
Broadway, New York 5,rN.! Y. '
!
ation — Brailsfprd &c Co., 208
Petroleum — Detailed study of
Also available is a new memo¬
South La Salle Street; rchicago
the, industry analyzing from the randum on United Utilities -Spe¬
'Boston & Maine Railroad
viewpoint of those whose empha¬ cialty
4,; 111.
Corp.
Circular -A Walter j." Connolly &
Also available is a circular on
sis is primarily on our nation se¬
Ch., 24 Federal Street,-Boston 10, Queen Anne Candy Co.
curity and the viewpoint of those
-American Insuiatorr-Memoran- Mass.
who approach a discussion of pe¬
.
.
~
been
write
Corporation
articles
Mark
to
Schenley
350
of
they have
running in the Chronicle—
•
Fifth
Merit, in
Distillers
>
Avenue,
care of?
Corporation*
New York 1.
Y,;fe^
N.
;
•
_
>
>
Texas
tions
the
technical
dijim—Peter
and
way,
economic standpoint—summarizes
future prospects of the industry
and contains individual 'surveys
of 38 of the leading oil companies
.
Barken, 32
New York 4, N, Y.
Broad¬
'Central
of
American Phenolic Corporation
-Memorandum—J." F. Reilly &
,
?
»
.
'
/
-
a
.
"
/
T-
»
\
-
\
,
'I V'" 9<
i * ^
-
4
*
°
'
Long Bell Lumber Company;
Revised brochure including earn¬
ings for nine months ended Sept
30,
1946—Comstock
&
Co., 231
•
Analysis
•
Peltasohr Tenenbaum Co., Landreth Building, St. Louis
2, Mo.
South La Salle Street, Chicago 4,
tion
K
W
(,),v
41*,
-
a solution of the labor problem is to'keep gov¬
put - management and organized labor as nearly as
possible into positions of approx-<»'"- ' • • • ———1 '
'1 - - v"
imate equality, take from each' sider how much the^husihes^ will
the power to destroy the other, probably be damaged: by-a ? re¬
and rely upon collective bargain- fusal of concessions, and whether
the1 damage will offset the sav¬
zing,,/ If you strip the ordinary labor ings. When neither side can hope
dispute of its political or ideologi¬ to be Jrescued by governmental ac¬
ernment
and
—
Chesapeake & Ohio-Pere Mar-
The approach to
•
v
4, 111.
out,
Musicraft. Recording
arid appraisal of Investment
.
;
,
,
■
■
-.
outlook—Brailsford
& Co.; 208 South La Salle
Street,
Chicago 4, 111.
>
,
,
-
;
-
South " La
3,
Gas
\
:
Nathan
&
Co^ 50 Broadway,
Co.,
Street,
;
—
12(1
Chicago
I
,
Also, available is a circular
on
Hardware Foundry Co.
Chicago
j
mi
New
Cti. ■-«. —
:
[ {(SpeclaL-; to Thr Px^ancial Chaqniole)
i ILL.
CHICAGO,
Plennert
has
joined
;
% '• 2
J^reet.
•
the {staff, of
Co.,- 208 South
*
' t,:yV"
*
•
■
Active Traditig Markets in
•,.,•
England
Public
.-••
:
•';:■'c r---V
■
*:■?.?• v*:."
Common Stocks
Service
lias
Service
declared
the
Company
full
regu¬
dividends of $3 on its
preferred and Class A stocks
lar
Haupt & Co., Ill* Broadway, New
York 6, N. Y, '
its
:
has
declared
$1.73
on
common
stock, all pay-!
able January 2 to holders of
record December 10.
Fred W. Fairman & Co., 208 South
La Salle Street, Chicago 4, 111.
.
Company
Pfd., Class A and
American
Circular
oil
Request
ADAMS & CO.
231
}
SOUTH
LA SALLE STREET
}?
CHICAGO 4, ILLINOIS
TELETYPE CG 361
■'
PHONE STATE
(Ml
.
•
•
—
^
Aeronca Aircraft
Corp.
;
Baitimore{Transit Co--Pfdl.
Chgo. Auro. & Elgin Ry. Units
Howard Industries,
-
Inc.
•
Hi
Hamilton
Manufacturing Company
COMMON STOCK
"'Long-Bell Lumber Company
A New Memorandum Sent
Mastic Asphalt Co.
;
MIDLAND UTILITIES
|
•
*
MIDLAND REALIZATION
{gig!
^Hydraulic Press Mfg. Co.
Old Ben Coal Corporation
-7T
MUNISING PAPER
Miller
Manufacturing Co.
Seven-Up Texas Corp.
-jrr> ' •
Request
'*
;
v.;
til
Chicago:
Trailmobile Company
*Detailed analysis available on
i
Members Chicago Stock Exchange
DOYLE, O'CONNOR & CO.
•
v.
f
INCORPORATED
r;
^
request.
Comstock & Co.
"
225 EAST MASON ST..
PHONES—Daly 5392
St. Louis Public Service Co.
**.'
;
>y
MOSINEE PAPER MILLS
KALAMAZOO VEGETABLE PARCHMENT
on
,.-;'yy
State
0933
MILWAUKEE (2)
'
'Teletype MI
135 SOUTH LA SALLE STREET
v
'
CHICAGO 3, ILLINOIS
488
«
«
.
.Telephone:. Dearborn
&161«
«r
-
^ '>
....'
.
-
T,l^r ^
>
>
-
Teletype! CG 1200 "
}
£
J.
American Service
-
i-:
-
Frank
—
Linkr Gormaq &
Appraisal} of values*—• Ira
cal-irrelevances, the issue will be tion, and both sides know that the
reduced to two sets of considera¬ issue'will be fought out On purely
Columbia Gas & Electric Corp.
Pan American Airways Corp.tions: The members of the union economic grounds, the debars and —Analysis — L. F. Rothschild &
Study—Sills, Mintori & Co., Inc.,
must decide how niuch of a sac¬ cents balance will be peacefully Co., 120
Broadway, New York 5, 209 South La Salle Street, Chicago
rifice of wages they'will probably reached far more often than it is N. Y.
4, 111.
:
have to make to attain their de¬ today. When both sides
:»■»/
ar#fr^e
mands, and at what point an ad¬ toqfight, but both, 'know the otheb
Columbia Gas & Electric Cor¬
Parker-Appliance Co*—Descrip¬
ditional sacrifice will not be worth is j willing- to do battle, a - strike
poration—Detailed
memorandum tive
analysis—du Pont, Homsey
the'probable gain. Management on or) lockout wilT rarely 'occur. A —Bear; Stearns &
Co., \ Wall Cp., 31 {{Milk
Street, Boston 9,
the other hand will have to con- substantial balance of power; .es¬
Street,1 New York 5, N. Y..,,,
Mass,
*pecially on. the- purely economic U'-:k
1 'M "Part of. an address by Mr.? Ball questions - of - wages,: - hpursj Vand
'Connecticut Railway ^ Light¬
PettibOne Mulliken Corp.—Bul¬
at 49th Annual -Meeting of Na¬ physical
working • conditions,
ing, c Co, — Circular
Adams
&
tional Founders' Association, Chi- would 'therefore be. d Submit; ^the
letin—Doyle, O'Connor • & ; Co.,
Peck, 63. Wall Street, New York 5,
Inc., 135 South La Salle Street.
^ago, 111., Nov. 7, 1946.
*
' "
(Cohtinhiedbn page 3639)
' "
" N * Y
Chicago 3,11b1'
'
I
i•;
,
.
With Link, Gorman & Co.
Straus-Duparquet, the;
& : Electric—
New York 4, N. Y.
Salle
&
v
;
Northern Indiana Public Serv¬
Study*of the situation—Edward ice : Company-—recent
analysis—.
Al Purcell
Caswell
m-,
and
Columbia
N
Universal Zonoiite Insulation
Analysis —
—Stjudy of history and outlook—
Troster, Currie & Summers, 74
Ttinity Place, New; York 6, N. Y.
Chicago North Shore & Mil¬
Railway Co.—Brief mem¬
on
-—
Street, New York 5, N, Y,
.
waukee
orandum
stocks
Corpora¬
kih & CoirinCi, 41 Broad Street,
New York 4,, N. Y. {
Also available is a review of the
reorganization of Central & South¬
west Utilities Co.
public- utility
common
tion—Analysis—Seligman, Lubet-
opportunity offeredr-Kalb,. Voorhis & Co., 15 Broad Street, New
York 5, N. Y.
and
Saxton & Co., Inc.,. 70 Pine
La! Salle
.qijette Merger—Review of situa¬
,
'v
situation
developments—Penington,
.
so
*■
•->
recent
of
"
that there will be a balance of power between contending
Says historic goals of organized, labor are Incompatible:
With success of private* enterprise jand r asserts establishment of
labor tribunals will result merely in further increase in bureaucracy."?
Asks for a minimum amount of government interference in collec¬
tive bargaining.
)
Canada—Study- of
5^s
Electric
Co.
Pfd.v—
•
Secretary and Counsel, Montgomery Ward & Co.
gaining
parties.
Gas
Chefford Master
Mr. Ball urges stripping-labor strife of political and ideological
irrelevances and the establishment of basic rules for collective bar¬
\
Utility
Consolidated
——
Collective Bargaining
r
Public
and
Nickel
Comprehensive Colket &_Co., 70 Pine Street, New
study and analysis in brochure York 5, N. Y.
•Also available; is a
form—Fred"
Fair man & Co.,
study of
208 South La "Salle
Street, Chi¬ Westinghouse Air Brake Cui^y
aiid
'
By STUART S. BALL*
•
'52
cago
Restoring Equality In
*
International
Co.
outlook in
on
unlisted
on
preferred
G. A.
'
from
Service
the: current issue of "Public Util¬
ity Stock Guide" giving quota¬
—
troleum
Public
Brief memorandum
CHICAGO 4
231 So. La Salle St.
Dearborn 1501
Teletype CG 955
tfrrr
r^,p'••;'• r-
i;„ •
.._,:.
hV'.
'
1
I
I
''
1
1 11 * ■
I
'(•
'
I
■'
IV '
''
I
,
THE
2612
"
.
'
.
preferred to be offered publicly by an investment
syndicate headed by Morgan Stanley & Co., of New York. Proceeds
will be used for modernization and expansion program, including ad-*
ditions to new manufacturing and assembly units. .Offering price,
dividend rate and redemption will be filed by amendment.
*
*
*
vv
/ ^
——— ""
matically be exchanged for two
Borg-Wamer
has
announced new shares. Listing applications
the purchase of the physical assets
for the new shares have been
of
Superior
Sheet
Steel
Co.
made to the "Big Board'* and
Canton* Ohio, to become a di¬
the local exchange.
vision of the corporation.
no par
.
'
*
*
sjr
Mercier, McDowell Co.
1
MICH.
DETROIT,
McDowell
Mercier,
Dolphyn, mem¬
and
the
of
bers
—
Stock
Detroit
Ex¬
change, have announced that Nick
J. Allman is
them
associated with
now
customers representative.
as
previously with
Baker, Simonds and Company and
other brokerage firms on Griswold Street, except
during the
War, when he aided the War ef¬
fort at the Chrysler Tank Arsenal.
Mr. Allman
He
will
was
now
Trading on the Detroit Stock
Exchange during October totaled Buhl Building.
391,912 shares, valued at $4,679,Kenover & Co., purchased $70,000
747^ as against September's total
Village of Richmond sewage dis¬ of
467,856 shares, valued at $6,posal system revenue bonds. .•
674,745.
A./ Ac:
* Sw
1
located
be
at
'
|
,1
stockplan
a
capital
authorized
500,000 shares of common,
shares of $1
Present shares will auto-
*
$2 par, to 1,000,000
par.
Call Us On
Any
New York Stock
812 BUHL
A'K.:
Exchange
BUILDING
Teletype
.
:y
•
*
•
DE 167
:
olic
r
A,
SEC
The
DETROIT 26, MICH.
'
until
extended
has
municipal issues, Cath¬
institutional
Crane
*
Phone
capitalization of Michigan Gas &
Electric Co, may be completed
The SEC also approved Michigan's
proposed issue of V-k% $300,000
unsecured serial notes.
Co.
Cfaarles A. Parcells
Established 1910
Members Detroit Stock Exchange
was
Glas &
be
sold
DE 206
New
at
"over-the-
in
prices
in
counter"
will
time"
to
York
and
De¬
*
*
sociates,
Co., / Paine,
,
Webber,
Curtis, Crouse
.Company
&
Gilbert
Common Stock*.
have
Vt '.
Request.
& Co., Donovan,
Co., and H. V. Sattley
purchased
Mich.
a new
State
2%
DeYoung, Larson & Tornga
Phone 98261
:
the
tuted
GRAND RAPIDS, MICH.
'
issue of $1,-
Normal
2%%
and
revenue bonds.
of
ipal
The issue is part
financial
to
standing
funds for
College,
dormitory
retire
program
all
tutional
to
provide
,
INDUSTRIAL BROWNHOIST
:VTS:
stockholders
9.
,
casualty
stocks. R. Jer¬
Glas will
emy
be
sole
pro¬
Glas,
Mr.
R.
former
treasurer of
a
the National
Jeremy Glas
,,
(
of
record
sociation, was previously a part¬
in Glas & Crane, Hyams, Glas
& \
Carothers,
Hyams.
and
Moore jA and
\
Mrs. Lee Blocker will be
ciated with the firm
as
;■
.
asso¬
represen¬
tative.
stated i that the
earnings
IsIsS*iSv
was
*«?/■*
The City of Stamford sold
from
Mutual
Company
ance
Life
of
Insur¬
New
York.
The proceeds will be used to re-
current
substantially
above the prewar level.
tire
the
v
and
j to $ provide
funds for
additional
working
capital and plant facilities*
*
$700,-
13, 1946, due
April 15, 1947, to the First Boston
Corp. @ .639%. Other bids ranged
* "'•
%
* :• x'.. *
$1,500,000 loan dated Nov. 6,
1946, and maturing June 20, 1947,
to J. P. Morgan & Co. at .666%.
Other bids ranged from .67% to
Floyd D. Cerf Co. Heads
Group Offering Com.
Stock of Oxford Radio
a
the
For
nine
months
elided
Sept; 30, 1946, Hartford-Empire
showed net earnings of $2.15 per
dividends of: $1.25
paid.
■'
!.
Floyd D.
headed
a
vestment
Cerf
Co; of
Chicago
nation-wide group of in¬
dealers which on Nov.
20 publicly offered 60,000 shares
of $1 par common stock of the
Oxford
Radio*
Corp. of
Chicago,
of the country's largest manu¬
facturers of loud
speakers and
one
-v
The coihpahy also manufactures
communications loud speakers and
reproducing equipment
which is sold to leading radio,
Railway & Light¬
inter - communication, sound - re¬
ing Co. for the first nine months
of
this
year I showed
operating cording and sound reproducing
revenues of $4,603,469 against $4,manufacturers, among them RCA,
769,661 for the corresponding pe¬
Zenith, Stewart-Warner, Motorola,
riod a year ago. Net income for
these periods was $915,759 and Sylvania Electric Products, Dicta¬
$757,098, respectively. Over - all phone Corp., Radiomarine Corp.
charges, after income taxes, were and Canadian MarcQni Corp.
covered 2.62 times and 2,01 times,
Q With the: exception of certain
respectively.
metal
parts, ?alh manufacturing
operations are Carried on in the
Torrington Company had net
company's plant.' Its backlog of
sales of $22,781,282 for the fis¬
orders ; on ; Sept.
15 this - year
cal year ended June 30, 1946,
compared
income
Chhonicle)
of
$2,729,910, respectively.
*
With King Merritt Co.
Financial
with $29,510,151 for
fiscal year. Net
$2,670,732 compared
the preceding
.a
a m o u n
t
e
d V to
approximately;
$2,500,000. /
/. :
*•
jProceedsf of- the financing Will!
be
*
*
City of Meriden awarded
Wood Struthers & Co., $75,000
The
used
to *pay
off
bank
loans,
purchase of additional machinery
and equipment and. for general
LOS
ANGELES, CALIF.—Jo¬ to
seph^ C.Pusateri has joined the sanitary and storm sewer bonds at corporate purposes. There is pres¬
staff of King Merritt & Co., Inc., 100.0473 for 1 % interest rate.; The ently outstanding 175,000 shares
;
bonds are dated Nov. 1,
1946,;arid of
common,
"V.
v.
Fifty-fifth Year of Dealing in
Members New' York and Boston Stock
Exchanges
Hi
Associate Members New York Curb
Exchange
Connectic ut See urities
Primary Markets in
Primary Markets—Statistical DiformatioBt
•
Information
Hartford and
Moreland & Co.
1051 PENOBSCOT BUILDINGL
^
Copnecticut Securities
CHAS.W; SCR ANTON & CO.
Hartford 7-3191
MEMBER DETROIT STOCK EXCHANGE
-
.
Members New York Stock Exchange
New York:
New Haven 6-0171
BOwling Green 9-2211
DETROIT 26
New
•
•Bay. City
^
*
,
•
..•Lansing'''' I
-
'
-- -.
Muskegon
•
outstanding'
presently
>1 funded ? debt
000 notes dated Nov.
With
,
loan
quarterly rate
President of the
The
;
,
-
Security Traders As¬
ner
-
~
record
14 to stock¬
Nov. 30.
This
V-'. *'••
vvy r«
;.A;Markets
of
common,
Dec.
Connecticut
insurance
THE C. H. DUTTON CO.
■
holders
the
on
payable
brings total payments for 1946 to
$4 per share, 500 having been
paid in March and June, and $1
in September. . \
*
1 This compares with 500 a quar¬
ter paid in 1945,. or a total of $25
Previous
100.
Tifit Brothers
RESISTANCE WELDER
dividend
stock
sound
Chamber of Commerce Bldg.
LA. DARLING CO.
to
far this year
corporate
(Special- to The
building.
are
the second quarter.
have»been
and
previous out¬
bonds. and
a new
insti¬
company
associated acoustical reproduction
which
compares
with
equipment. The stock was offered
$2.53 a share for the entire
at $5 per-share.
• '•
-< ■■
>
foitr-year period 1942-1945. ^ So/;
munic¬
issues,
& prietor.
Jackson
030,000 State. Board of Education,
1%%,
GR 84
McDonald-
Moore & Co., Watling Lerchen &
Ered B. Prophet
on
including
the
share /
Catholic insti¬
and
*
-
First of Michigan Corp and as¬
Circular
in
bonds and fire
troit.
of
The Town of Stamford awarded
NEW
t
Shares
time
"from
prevailing
Teletype
Randolph 562$
stockholders.
the
to
President
/•/t
Company Is
Formed in New Orleans
,
shares^ of $1 par common to be sold sippi
DETROIT 26, MICH.
The
from .64% to .75%.
Shatterproof Glass Corp. has Louisiana and
Missis¬
registered with the SEC 280,000 and/
Building
:
'
*
e
$2
a
■
Mr.
partner
a
,
Michigan Markets
Telephone
corporate
previously
in Glas' & Crane.
traders
639 Penobscot
and
ORLEANS, LA,—R. Jer¬
emy
Glas has formed Glas &
McDonald-Moore and H. V. Satt
Company with
offices ? in
the
ley have purchased the Village Whitney
Building to' act as underof
Lowell $48,000 ; 1 % % ' bonds
writers, redue serially Oct. 1, 1949-1972.
tailers
and
*
Weeder-Root, Inc., has declared
?'ago;::^f::::;;^
rate of
bonds and insurance stocks.
\
.
'
Nov. 30 the time in which the re
Cherry 6700
,
V
company
G." Price Crane
term bank loans and add to work¬
*
the
ago.
'
was
Louisiana
*
excluding its unconsolidated sub¬
sidiary, reported net profit of $1,710,017 compared to $671,474 for
*
Nov.
Society of U. S.
president said pro¬
»
assets
For the -first nine months of
this year, Bristol Brass
Company,
corresponding period a year
On a per share basis, earnworking capital $18,525,600. In-; ings were equal to $1.73
cohipared
ventories at the end of Sep¬
with 630, respectively.
tember, 1946, stood at $18,132,*
%
530, against $12,694,117 a year
30
Assurance
ing capital.
'
to the public.
Pitney-Bowes, Inc., declared an for the "year.
dividend of 100, together
with an increased quarterly divi¬
The Silex Company has obdend of 12V20, both payable Nov.
| tained a $1,250,000 15-year 3Vz%
ceeds will be used to retire short-
Members
The preced¬
current
offered
extra
'
Wm.C.Roney&Co.
30,
■*
Wood, Inc., has placed $5,issue of 3% debentures,
Oct. 1, 1961, with Equitable
firm's
of
of 90% over the first quar¬
ter of the year and a 34% increase
Gar
The
assets
crease
000,000
Life
,
1946, net profit
1946,
currently running about $990,000
week, which represents an in¬
Mich., has publicly sold an issue
of $30,000,000 of 2.35%
15-year
debentures,
due Nov.
1, j 1961,
through a New York firm. '
(
:i$. :S:'^\/i:£■■#S,Iv'
due
com¬
30,
totaled $20,661,705, current Ina¬
bilities
$2,136,105,
and
net
oyer
MICHIGAN
Sept.
current
recently stated that net sales
■
UNLISTEDS
Sept.
Midland,
of
Chemical
Dow
total
a
*
*
<
of
as
showed
Opens
'
•
■
,
The balance sheet of the
pany
ing
financing included $5 mil¬
lions from Metropolitan Life and
$5 millions from a bank group
headed, by the National Bank, of
Detroit/
1
a
ital of $22,809,241.
said the
t
Corp.
approved
have
A increasing
1 from
<
Steel
Detroit
1 holders
$
a
.
Thursday, November'- 21^1946
a
($1.55
.
at
.
was $423,04S
share) against $597,567<^—
—
—•
■/
corre-t
share) for the corre- due $8,000 each year Nov.
1,1947
sponding period last year. Earn¬ through 1951, and $7,000
annually
ings per preferred share were November, 1952,
through 1956, in¬
$16.02 and $22.63, respectively.
clusive. The bonds were not re-
(980
Own Investment Office
^
'~\''*//>'7'i<KVk
period in 1945.
1012
; Continental
Motors has bor¬
Noble & Co., Grand
NEW ORLEANS, LA.—-G. Price
Rapids and Detroit, offered 30/- rowed $10,000,000 to finance mod¬
ernization and expansion of man¬ Crane has opened offices in the
000 shares of Sperti Foods, Inc.
facilities,
purchase Whitney Building to act as under¬
(Ohio
Corporation)
cumulative ufacturing
convertible 5% preferred, $10 par, new equipment and add to work¬ writer, distributor and dealer in
ing capital. President C. J. Reese
at $10 a share.
jis
;'m
.
$27,225,230, current liabilities of
$4,415,989, and het working cap¬
G. Price Crane
White,
..l / -V-U's
/ftn/or the nine months ended Sept. 30,
Donald-Moore
•
l':;V' A . "A-
Bigelow-rSanford Carpet Co." reported net sales for the third
quarter of $8,368,839 against $7,952,883 for the
three months ended
bept. 30,1945._ In the same quarter this year the
company reported
net profit of $204,249 or 530 a
share, against $65,285 or 90 a share for
the like
V. Sattley & Co., Inc., Mc¬
& Co. and Miller,
H.
1'rf('".
N. J. Allman Is With
with the SEC 1,000,-
General Motors Corporation has; registered
?
'!"
1'
COMMERCIAL & riMVNCIAL CHRONICLE
Michigan Brevities
000 shares of
r'"
''',,iv'
;v
Bell System ^Teletype:
HF 265
■
London 2-4301
Hartford 7-2669
'
New York Canal 6-3062*
Telety ie NH 194:
Waterbury 3*3166
Danbury 8600...
•_
'
Volume 164
A
Number 4544
THE COMMERCIAL A FINANCIAL CHRONICLE
share was also paid on
per
Missouri Brevities
Central Underwriting
Fund for Small Business
preferred Stockton July 1,
year/
The Kansas City Pow,er & Light Co., Kansas City, on Nov. 1 filed
registration statement with the Securities and Exchange Commis¬
sion covering $36,000,000 of first mortgage bonds, due 1976, and
100,000 shares of $100 par value cumulative preferred stock, the pro¬
ceeds of which are to be used to redeem $38,000,000 of 3%% bonds,
a
due
1968, and 40,000 shares of first preferred stock, series B.
underwriters
are
by competitive bidding.
increase of 25.2% over the $4,-
;
-.
month last year.
same
An issue of 41,327 shares of
cumulative
5%
participating preferred
10-months
(par $25) and a total of
20,000 shares of common stock
(par $1) of George Muehlebach
against
as
Oct.
ended
the total was $53,054,383,
year,
stock
for the
For the
31, this
reported
sales
427,009
^
The
to be determined
$42,928,975
the
in
income after Federal in¬
for the nine months
Net
taxes
come
$593,421, equal to $3.84 per cpm^
mon share, which compares with
a
net of $517,950, or $3.19 per
At
meeting
special
a
the
of
and
correspond¬
share, in the
common
For the 12
ing period last year.
ended Sept. 30,1946, net
months
$630,495,
totaled
taxes
after
or
$3.80 per common share, as against
share,
stockholders of Ely & Walker Dry
Goods Co., St. Louis, held on Nov.
amounted to
ended Sept; 30, 1546,
$584,323,
first 10 months of 1945,
Brewing Co. were offered on Nov.
7 by a syndicate headed by Stern
Brothers & Co.* of Kansas City,
the
this
$3.38
or
Net current assets
Sept. 30, 1945.
at
Sept.
amountedto
1946,
30,
common
per
months ended
12
the
for
including, among others, Bar¬
$1,681,266, as compared with $1,'ret, Fitch &" CO.,"Inc., arid Burke 14, amendments to the articles of
& MacDonald, also of Kansas City, association of the corporation were 085,784 on the same date last year.
common
the;-preferred priced' at par arid adopted changing the
dividends and the common at $5.75 stock from $20 par value per share
to no par with a stated value of
per share. All of the common stock
and 6,500 shares of the preferred $10 per share and authorizing the
Primary Markets
stock are for account of the com¬ exchange of the present common
Bank & insurance Stocks
for the new common on the basis
pany, the net proceeds thereof,
.of two shares of the new for each
together with other funds, to |ae
^
909) of
Following
proposed expansion program and
working capital.
stock
common
in the authorized
being offered
to its officers
key, employees at $4.75
from
the
fund to
a
in
use
seeking
It
creased shares
bution
1
and
Thompson had about
$64,000,000 in cash on hand, and
that after all, required deductions
have
been
Hard
Money Theory
still
at
purchase
se¬
rial gold bonds, Cairo & Thebes
RR. Co.
and
Branch
cent
Bros.
on
Stores,
Dec. 12, next,
stock
of
an
Jan. 25.
extra
on
Nov.
early this
-
year on a
was
split;
& Common Stocks
was
to
2-for-l basis.
holders
1946.
on
were
was
of
Kansas
of
Like
clared
$5,541,676, which
also
received
Locust Street
a
1. Mo.
Central 8250
Saint Louis
American
City,
on
of.
dividend
stock, all payable Jan. 2, 1947,
up
which
to
Convertible Pfd.
COMPANY
Co.,
Sales of Edison Bros, for the
ed
interested in
June 10 and 500 on
14 declared
month of October, 1946, amount¬
-
ave
$3 per share on the preferred,
$3 per share on the class A and
$1.73 per share on the common
the present $1 par com¬
which
year
on
directors
Service
brings total
to $1.75 per
stock, as against $1.50 per
share paid on the old $2 par com¬
stock
A
an
record
amounts
Nov.
paid
17,
on
last
*CHEFF0RD MASTER
10,
Dec.
were
de¬
year,
MICHIGAN CHEMICAL
Jan. 2, 1946:
♦Analysis on
Peltason Jenenbaum Co
BUILDING:
*
LANDRETH
Dazey Corp. Com.
-
Bequest
participating dividend of 640
MARKETS
'•t
;,r
Teletype SL 477
-
Payments in 1945 totaled
The
mon
mon
We
718
share, both to stockholders of
share
of
as
the
record Nov. 30:: This
year
record
750 per share.
its
on
in addition to
payments this
of
split-up (which
this
371/2 cents
pay¬
usual quarterly dividend of 37 %0
per
2-for-l
shares
St.
Inc.,
dividend of 500 per share
common
Angeles
Telephone CE 0282
approved by the stockholders on
Sept. 7, 1946). The old $10 par
Louis; have authorized the.
ment
Los
•
stock
souri; Pacific RR."
New
Chitago
"
,
private wires—
York, Kansas City, ^
and connecting
Co.,
Sept. 10, last, on the old $10 par
outstanding before .the re¬
-
to the best interest of the Mis¬
Edison
Direct
Nov. 30, 1546. This is equivalent
to the 500 per share dividend paid
Union
Pacific Ry. 4% bonds, at fair
I and reasonable prices, would be
directors
of
Louis- Stock Exchange
Members St.
ST*. LOUIS 1. MO.
special
a
stockholders
to
4% first mortgage bonds
Central
stock
quarterly of 400 and an
Fuller
and
time
this
At;
board
$4,000,000 needed for the
through tenders of Mo. Pac.
common
of
meeting of the
of Stix, Baer
St. Louis, held
Nov. 15, a dividend of 25 cents
per
share was declared on the
new $5 par common stock of the
company, payable Dec. 10, 1946,
:
Mr. Thompson told the Court:
SllilllifO£: Interest Rates
*Statistical Information on Request
$1.20 annual
extra of 100 were paid.
fund.
"The
jwould
he
iriade
*CIyde Porcelain Steel Corp*
for each
outstanding
quarterly of 500
a
extra
an
year a
Mr.
have the
Gruen Watch Co.
common
The last distri¬
the
on
;;f
250.
In each
of the first two quarters of this
of
as
t
consisted of
:
one
stockholder^
on a
dividend basis.
authority
& Preferred
Common
and also voted to place the in¬
$4,000,000 purchase
acquiring outstand¬
pointed out that
was
of
share
common
of the 47,146 shares
ing securities, bf the railroad.
Nov.
to
of
issuance
|
Trailmobile
100,000
Nov. 14
of record Dec. 1, 1946,
a
RR.'Co.,
^Pickering Lumber Corp.
stock
to
stock
hearing set for Nov. 22
on a petition
by Guy A. Thomp¬
son, trustee of the Missouri Pa¬
cific
common
on
additional
14, Federal Judge
George H. Moore,, at St. Louis,,
^Mid-Continent Airlines
i;
increase
an
shares
50,000
authorized
Nov.
to establish
the
shares, the directors
per
share.
ordered
by
Meyer-Bianke
of
of St. Louis of
Co,
are
by the company
approval
stockholders
>
*
An additional 20,000 shares of
On
*Stromberg-Carlscn Co.
bank loan, to finance a
a
to increase
and
i A
share of the old:
one
used to pay off the balance ($181,-
g
*.
j
ST. LOUIS 2,
.
Dazey Corp. Conv. Pfd..
M0.
L P-240
Teletype—SL 486
.E. Funsten
Hilton Hotel
Kansas City Public
Service Com.; & Pfd.'
Taca Airways
/
*
>
Southern Union Gas
f /
|
Berkshire- Fine; Spinning
:■
.
Barker Dome Oil & Gas
■
Delhi Oil
INVESTMENT
Universal
SECURITIES
Match
500 OLIVE
SCHilU:^ RICHTILXOMPANV
.
Bell Teletype
Landreth Building
St.
i
Louis
SL 456
^^
n
.
M
'
.
TfTyfl'1¥ $ % f *jr* ■■*-0 ? •*
2.
^
1
Mo.
STREET
S^Lbxjisl.Mo
"
Member! Bt.
Louie Stock Exchange
Garfield 0225
L D. 123
t' ¥ ,!jgf& v.* c
P *
' '*
f
?614
THE COMMERCIAL & FINANCIAL CHRONICLE
.
J. S. Fox Opens
(Special
to
The
Financial
MONROE, LA.—John S. Fox is
engaging in the securities business
from offices in the Ouachita Bank
Building.
Associated
with
Business Outlook Key to
Stock Market Prospects
By G. Y. BILLARD
the
Partner, J. R. Williston
-
;
and
probably
settlement
stock -market
hand
climax
will
at
with
the
during; all this:
going down. If this
pattern is to hold, the stock mar¬
period kept
crisis is
of
and didn't begin to deterior- v
seriously until late 1920, Yet
the
Crisis
Postwar labor
coal
Co.
&
ate
year
get them until 1948 at the earliest.
the
{
.
Thursday, November 21,1946
leaving six who would not
year;
].
Chronicle)
f
should
ket
threatened
on
be
going down right
now.
strike,
*
,
,
being dogmatic,* there
.Price d e c q n t r o 1 will mean
are some very good reasons why
In view of many uncertainties,/market analyst contends prices will j /• within the. near future a consid¬
the 1919*21-period will probably
erable decline in
not substantially change in near term, since removal of price
andj Items making up* many important not be repeated except in • min¬
the, cost of liv¬ iature form. In the first place?,
wage controls creates additional stresses and strains in economic
ing ■ index, Moreover,: the prom¬
system.
Says market has already discounted foreseeable/con-j// ised 20% reduction in income commodity prices, other than ag¬
ricultural, are nowhere nearly as
traction in earning power and reduced dividend payments, and that
taxes next year should mean rel¬
j
inflated as in the period folio wr¬
atively larger real incomes. These
a
primary recession can come only/through prolonged labor
ing World War I. In the second
.
firm is Mrs. Blossom S. Butler.
>
.
y
-
j
Without
.
,
Ay res, Barley & Assoc.
Ayres,
Inc.
Barley
&
Associates,
is engaging in the securities
business
from
offices
165
at
.Broadway, New York City.
/' troubles.
Cites expansion
programs
two
of leading industrial
concerns
/
market recovery in next year. !
;•./
"•
bor's
.
for
f
:,o
"
.
tainties
far
securities!
in
the
as
so
near
any
and
w.i 11
it
take
time
ual
a
be
t ed
un
evalu-
This
vent
Y.
Billard
,
?
,
security prices from moving
far in either direction dur¬
ing the near future. The dominant
very
over-all
Membert Newf York Slock Exchange
-
factor
is
the
labor
situ¬
ation, and until; the rapidly ap¬
proaching crisis is resolved, cau¬
tion is likely to continue in mar¬
ket dealings.
v
Members New York Curb Exchange
40 EXCHANGE PL., N .Y.
Dlgby 4-4950
Removal of the wage and price
spark plugs from the
/Washington
Belt Teletype NY 1-953
propaganda machine is merely
initial though important
step,
the dismantling .process. Y -
A
Firm
/Beneficial
Trading Markets:
ation
to. q
of
additional
business
//.//
field.
or
tivity
-
'/,:
to
expand
months
after
the
for
stock
ber, 1919. Actually, business held
around .peak-
levels for nearly
i Knickerbocker
more;
soon
news,
Lott
prime
1919,
bonds
was reached last May, prime
equities yield about 4.5% vs. 2.7%
for prime bonds. Unless there is to
be a slaughter of dividends-^-and
of
fairly
nature—
flight
from equities? Any major
delib-f
erate liquidating movement from
equities presupposes that /there is
a
permanent
what basis is there for
other
some
mass
of
form
investment
providing superior return.
;
,
Y'-
vjs
t
"y
^ V
/1'
,
V- vS
>•
sI
£
' ■*
Recovery Prospects
Regardless of whether the post*
down trend has run its course;
war
the
probabilities' appear to be that
the lows "for
the
most
for
year
stocks have been seen and that a
formidable
be
is likely £t<y
carrying at least
recovery
witnessed,
(Continued
a
Y at present,
obviously discounting is
on
2616y
page;
-
By JOHN CARTER VINCENT*
.Yv
Land
Trust
Ctfs.
Central 4424
/
.
obtain
a
stranglehold
on
high
State
Department specialist after reviewing development of U. S.
our role in Far East is to bring about
Far Eastern trader asserts
mutually beneficial commercial and cultural, exchanges which prointernational welfare and understanding. Sees also ^ need for
come only through prolonged arid
a strong national defense, and though admitting overall picture for
serious labor disturbances.
Ade¬
./expanded trade is not encouraging because of disturbed political"
quate testimony of the confidence
in-the future outlook is found in Y>afid economic conditions, concludes Far Eastern trade is essential
the expansion plans of industry, ;
to our raw materials supply. ( Contends notwithstanding present
with- General Motors alone con¬
difficulties, potentialities of expanded trade exist.
sion within the visible future can
mote
,
,
templating a -.postwar outlay in¬
volving some $590 millions, to say
-
American business with the Far East began
can
and construction
being two of the
obvious fields where
major read¬
Chicago 3, 111. /
/Tele. CG
cre¬
justment will eventually be wit¬
660
nessed.
Price
dilemmas
however
"Empress of China," out of New York, put into Canton on Aug. 30,
eral
1 7 8 4; after
making: q, tpr-
Electric,
$50/millions
Bethlehem Steel,
for
etc. Then there
schedules
six-
many
age
around
the
Cape ,of
I do not
prices
fo
r
tuous
months >v.oy-
;
and.
mar¬
was
"factpbne/re¬
cent survey in the.
persons
indicated
autpmpbile/ inY
that out. of 12
wanting to buy automo¬
cotton,
having
I am safe/in
next
Broadway Barclay 2s 1956
Ambassador Hotels
■
<
Grant Bldg. 2%s 1957 WS
2
Hotel Waldorf Astoria Common
National Hotel Cuba 6s 1959 WS
New York Majestic 4s 1956 WS
Park
ware..-The to¬
of the Far East: Japan, Korea,
tal investment
trade
/
John
Carter
Vincent
•
$120,000.
Philippines,
areas
The
promoters
/
,
Pittsburgh Hotels Common
51
East 42nd St.
/
•
79
'
,
870
870
Roosevelt
FOR
Hotel
1956 WS
.
7th Ave.
41/2s WS V.
7th Ave.
Corp. Common'
5s,
1964
r
:
'
out
y
*
HELP WANTED
•
POSITIONS WANTED
*
V
,B
to
other
Siam,
and
of Southeast Asia.
this
East
Far
for
was
;
the/
adjoining;
Through//
American
period
the
portions
trader
based
on/
considerations.;"VV€;]:
concessions
or spe-j
cial rights; nor were our business
no
exploitation,
dealings based
upon
associated with
-
Realty 5s 1948 WS
3s,
extended
sound business
/«/;
,Av?. 4s 1946
y /
*•' ;|
19th Cen-Y
tury American business with, the
Gradually our
asked
}| '' •'
Westinghouse Bldg. Part, Ctfs, CBI
;
Lexington Units
,
Far East expanded.
/£
Savoy Plaza Class
Savoy Plaza 3-6s 1956
Units;
>
that the bene-?;
saying
the course of the
In
,
in the venture
more
ginseng, / but
knowledge of
;
for / tea,. > silk
and china-/
was
four
and
some
fit was mutual.
ed.; at. Canton
this
about
lead
had
Chinese businessmen, I still think
ginseng,
exchang¬
biles, about two would get them
year;
actually know how much
the Chinese made out of the furs,,
Goo
cin.g top cotton,- lead/,
customers out of the
ket. As 'a4 matter of
dustry
good
was
t operating
Corp;
what the company could; build pr
automobile
—
This
substantially i beldw
c u r r e n
are
—
cleared/ $30,000..
business; it was private /enter¬
prise; and it was mutually bene¬
ficial./ I hasten to say here that
is the head of the Chrysler
stating that
^—
'
<
with
OFFERINGS WANTED
The
162 years ago.
nothing of $200 millions for Gen¬
.
be visualized in? almost
every seg¬
ment of the
economy, agriculture
FIRST LA SALLE CO.
So. La Salle St.,
items.
as
other
Distortions which have been
ated by a monstrous
machine
Units
Trust
Director, Office of Far Eastern Affairs, Department of State
dr; Hope,,,.
goods will have to come from
The /vessel's /
higher producf ion efficiency, sell if it could get the /material; cargo, mad.e.
lower labor costs or
lower taxes. This does not look /like higher up of furs,;
Transportation Bldg.
Voting
and
Obviously raw material
commodities, < particularly metals,
are up to
stay for some time, and
any cheapeping in • automobiles,
tractors, ».* refrigerators or other
Hotels
'•;.•<
goods such
radios,
prices.
Hotel Co/
100 North La Salle
Hotel
reached
Trade Potentialities in Far East
thati.6%v/;///.•}
/ What / the
v market
levels is
Price
eventually blast many scar¬
cities and ultimately
bring lower
prices. Booming production will
Sherman 5/57 W. S.
Eastern
was
ket
down in; Novem¬
turned
November,
after
months
six
still>yielded 6.3% vs. 5.2% for
prime equities. Today, nearly Six
months after the peak of the mar-*
'' ://
equities.
continued
several
market
in
come
will
—
ESTATE;
SECURITIES'
Tei.
and
/The decontrol deluge, however,
IN
REAL
11
stresses
especially Y ad¬
vances in
copper^; brass and wire
products, steel scrap, tin,, zinc,
etc., as well as price increases on
EXbrook 851^
SPECIALISTS
.
-
still to
are
goods
automobiles,
../
to
already, a marked; contraction in
earning
free ; price economy/ but ad¬ power. and
substantially
lower
manufactured
t-
gradually..and in
resulting improvement
run,
many manufactured
•••/.'
a
1920,
top of the market
diminish
inspiration-
the dividend
payments
within, the
rises, foreseeable future. On the othbr
for instance, in
many lines during hand, practically every industrial¬
the
y/past : week .highlighted the ist admits that a primary depres¬
Montgomery St., San Francisco 4
Tele. SF 61 & 62
•
Cur¬
the
.
J. S. Strauss
•
At.
As/a matter, of /fact/out pf
mpre.
throughout the economic
system. Most non-durable goods
lines have been adjusted.'
durable
Y
in
substantially;
prices/ it isn't, difficult
find many issues yielding 6 %
In
third
now; fears in
May,
problem! shoiild the
t
increased
conditions
favorable.
more
union
Main inspiration for the bearish
argument stems from, certain sim¬
summer, predictions of widespread
ilarities/between the 1919-21 pet
business:; deterioration bordering
riod and ther present.
:
on a seriouss recession, if not de
//Such similarities, however, are
pression,' have come
from
all
more apparent,: than real. It must
sides. Yet, the simple fact is that
be admitted of course that the fact
while it is; now nearly six months
that .business today,' is. at a/ new
since the peak ; of. the /postwar
peak,, six ; months.. after the top
stoCk market was reached, busi¬
of. the market was reached in May
ness activity. instead of
receding; of this
year, is' in itself a,woak
has climbed to a new peak. Over¬
argument in contending that there
all earning power is at a very
won't be any major postwar busi¬
high level. DivicScnd payments, ness
relapse. As a matter of fact,
which -have been held at a very
in the corresponding period fol¬
Conservative level/during/the war
lowing World War I, business ac¬
years, are on the verge of being
rent
market
money
much
are
be averted
labor
Y /
^scrapping will be
as
longer
justments
Hotel
an
strains
Real
155
with it
a
tabulation of sdme
170 issues
the immedi¬ slated to pay extra year-end div-f
ate consequences will be /the cre¬
idends, /approximately 41% yield
the
over
California & New York
-v
.
to
labor
,
Gordon
doubt
no
place,
la¬
wage
.
certainty
will
:
another
since the stock market broke last
tend to pre-
SHASKAN & CO.
tend
Key to stock market .prospects
is still the business outlook. Ever
/wit h
clarity.
QUOTED
■,
the
in demand for
Discounting
be-
situations
can
/ SOLD //|S
*
-
can
over
aggressive investment demapd
,
for
the
under
place, deferred demand is
vastly greater—there were n<?t, for
leaders, as well as the «man in the instance, 24 million automobiles
street,- no doubt recognize the fact on the road as at the
present time,
that While a Republican Congress
75% of which, are over 10 years
will hardly place labor in a straitold. Finally, equities then were
jacket, it will insist upon fairness not in as
relatively a favorable
on both^ sides in- collective bar¬
position as today. That this is true
gaining; If a prolonged and costly
may be seen from the fact that
s/: concerned,
fore individ¬
BOUGHT
a
for * the present.-
term outlook
i
as
remove
from
Furthermore,
torment .for a further
and,; together ./ with re¬
newed demands; by .labor, which
strike'
are fast taking
shaipe!/will restrain
many uncer¬
real estate
corporations; will/ Coti'-
many
period
creates
wages
1
tinue
/and
prices
should
props,
demands
boost,
•
i
/ Spotty conditions again prevailed during/the past week, with tax
sOlUng continuing to:play a dominant role.
*
,
R a p i d- de-
control
factors
principal
symbol of confidence, and foresees likelihood of formidable
as
political privilege/
or
',}
pressure.
During
the
basic factor in
Y OTHER CLASSIFIED ADS
the Far East
19th
our
was
(Continued
Century
£
the
close ties with-
trade/Our
on page
early/
2634)
Amott, Baker & Co.
/*An address by Mr. Vincent be-
Incorporated
150
Tel.
Broadway
BArclay 7-4880
New York
7, N. Y.
Teletype NY 1 -588
SEE INSIDE BACK COVER
-
fore Far East Session of 33rd Na-t
tional
Foreign Trade Convention,.
New York
City, Nov. 12, -1946.
'/};
Volume 164
••
*.
■
•
-
v
,v
Number 4514
/
!..
.
.
■
...
"
_,A
....
,
,
THE COMMERCIAL & FINANCIAL CHRONICLE
■
r.
UFE and NYSE
Sign New Contract Extending to
Jan. 31,1948, Providing 12% Rise in Pay |
Other contracts covering the New York Curb Exchange and affili- '
ated groups, Clearing Corporation and Realty
,
;|§ extending to Jan. 31, 1948, and practically
,
,
New York Stock Exchange, are expected to be signed early next
week. Union convention to settle question of affiliation with some %
national labor
.
Association, also
contract with
same as
body
opens
today.
dreamed' of
half-dozen or more? of Wall Street's major brokerage
by fall so that when its*1
—
houses
a
contract with the New York Stock
that the union had considered Mr.
Exchange
expired
Keefe ill from overwork and had
would-be
in
to
15
it
•
■
•
.
ordered him. to take
v
iAn
a
election
a
two weeks'
■Metty With Fewel & Co.
rest,
held
!
LOS
cial Employees Guild, CIO, among
the employees of the People's In¬
dustrial Bank on Monday left the
of
cided.
21
persons
with
Fewel
&
Co., 45c
Spring Street,, members oi
the Los Angeles Stock Exchange.
ceived only 9votes. Ten
cast
were
Mr.
formerly
was
with
The
to
Financial
more or
SPRINGS, COLO.
—George Hopkins has opened of¬
fices
in
the
Mining
Exchange
Bldg. to engage in the securities
business.
Prior to serving in the
U. S.
Army he
was
Lewis &
baliots
D. Hopkins.
Co.
<
'V;
'
:■.
;
■
.
challenged.
The
itself
(Special to
The
Da^TON,
for final determina¬
tion. "v?
With Faroll & Company
With Slayton in Dayton
case
Financial
Financial
Co., 208 South La Salle Street.
section of the securities industry;"
While ; the union's:1 hopes have
not'
exactly materialized as plan¬
ned, it. can't be said* the union has
exactly Ipst any: grounds either;
tfie
New York Stock Exchange signed
a Contract retroactive to Oct.
15
and ' extending at the union's re-r,
<quest 15
months to Jan. 3 ly 1948/
.
"JJnioft
^members at the New .York
;Curb*- Exchange
' ktidc Affiliated
the Clearing Corporation
and Realty? Association—Tuesday
approved the proposal relating to
f new lS months contracts; also extending to Jan. 31, 1948, advanced
bodies
—
'
;.by/tteCurbai^;'th^e^affiliated
bodies -and it is expected^ that '"cort?
-
tracts
will
.
be
^
signed -covering
these -institutions early next week.
Both the^uaiow^iahdl^Uiel Curb
groups speak
ing
confidently of reach*
agreement so there appears'
an
to be little doubt but that every-
.thing will
along wery smoothly
go
^between them, v
Xz The^Stbel^^
" :
r
-
*
provided
for
pay
about
e'd^.e s
n*c r
t amounting to
12% - double
timiie .for -more;than;!2- hours - of
,
I work in any one day," time-anda-hhlf: for hours-beyond the *40-
;hdur;weefc,vthree^weekst^vafeatibh
;
yvith -
for employees^ witlv~;15
pay"
viyear^ofr
anditrtr;
proved grievance machinery. Cohcessions aren't all ia the direction
•
;; of i- the
union 'since; the;* contract
^alsq-contains
clause outlamn^
theU-ef usal of unionized Exchange
employees to handle business of a
struck firm and permits4he can¬
cellation' of the contract
by either
30-day -notice; It-is un^
de'rstood, that ;al repetition of last
summer's^ two^bour^ walkont:^;,byi
>'the employees, df; the Exchange is
party
on
■
barred • by- the new, contract.
~
%
t In general, the ".Curb contracts
will be approximately, the same as
the
one with the Stock' Exchange*'
it h'as been announced by both the
onion and the Curb, The only dif¬
ference
it it really is one— is
—
that the pay raises to be provided
for in the Curb contracts will' be
about; 11V2 %. The union has
nounced it will
an¬
-negotiate further,
next Tuesday> f(^ a Contract with
A. M. Kidder & Co.
The-
mind'
or
.
union
Will
make
its
up
the question of whether
not to affiliate with one of theon
national
which*
labor
one
scheduled
—
bodies
at
—•
and
a " convention
to
get under- way at
Schwartz's today 'at 3:30 p.m. The
"For two cents,
I'd entrust my
my
mittee. is
:
and produce goods. ~
industry."
what :the
tion
next
Wednesday
issue will be
\ ' In
one
nounced
;
part of the convene
;
when
>
the
finally decided.
it ^was---an¬
quarter
prior
to- the
signing, of
the NYSE contract that .M. David
Keefe,
union
President,
had
re¬
signed. The union, however, said
this
announcement
mature,
that
effect; turned
Mr.
in
was
Keefe
his
prer
had
in
resignation
but that it had not been accepted,
MARKET PLACE. FOR INVESTORS
„
American
be precisely
investor
the United Mine. Workers. It will
as
"
"This
industry With the
This may not
Scheduled
,
funds needed to create jobs
recommending affiliation
probably not be until the general
meeting of the entire membership
,
ownership,
...and share in the
With the A. F. of L. .but considera¬
tion will also be given.to possible
or
.
the risks and the rewards of
affiliation.with either the CIO
.
Commerce
the American investor
surplus funds in securities
first order of business will be the
selection of representatives to the
convention.. The, executive -com¬
ment
savings to business. I'd invest
thinks
even
...
pays,
or
but it is what
he does!
on
such
a
puts the people's savings to pro¬
use.
Countless investors
entrust their
basis is
ness
striking indication M
our
people's faith in business effi-
surplus funds to busi¬
enterprise only because they
know there is
always
slightly less tlian two
cents
come
out of the corporate indollar
.
■
.(I7V S. Departi
»
'1
.
ciency
...
of their, confidence?
in the future of
its
enterprise.
business
,
ready market
facilities, the Exchange offers
this ' advice:
money
Do not invest your
in securities,
other
or, any
until
you
v
have
the: facts—all the facts. Tips and ;
rumors
our
a
for their securities. To those who
form of property,
For
essential part
ductive
use
a
an
\
The ability of-industry to obtain funds
Exchange' is
of the financial mechanism which
;
have
Chronicle)
has become associated with Faroll
&
j.nird National Bldg.
The
CHICAGO, ILL.—T. T. Mooney
OHIO —Carrol
E.
with Slayton & Co., Inc.,
Larfdis is
;•
(Special to
Chronicle)
and working conditions in
general throughout an important
and
partner in
against the union and
position
less similar
{■■■'£On ivfonday*the: ?umOn
a
the investment business of Charles
wages
J' •
Chroniile)
COLORADO
Nelson Douglass & Co. and M. If.
re¬
how goes before the State Labor
Board
Metty
eligible to
vote cast ballots but the union
two
ciated
South
bargaining agent unde¬
All
ANGELES, CALIF.—Ber¬
S. Metty has become asso¬
nard
2615
a
George Hopkins Opens
(Special to The Financial Chronicle)
(Special
by the State
Board at the request of the Finan¬
issue
f
strategic
a
bargain for
Oct.
on
•
vacation for
were
Back last summer* the United Financial Employees
,
organizing
-i
no
place in
investment decision.
a
sound
'
'
•
2616
.THE COMMERCIAL' & FINANCIAL CHRONICLE
Safe Harbor Pwr. Bonds
Is U. S.
Military Government
Deserting Economic Democracy?
•
Safe
¬
•
was
at
'
^
The sale of the
bonds
new
i<Ta
part of the corporation's refinanc¬
ing program which also includes
tionism and discrimination. While
the
issue and sale of
a $5,000,000
The^-combined pro¬
ceeds will be applied to the re¬
the British claim that this is not
10-year note.
necessarily true of cartels under
their control, it is difficult for
many in U. S. Military Govern¬
ment to agree with this British
102 Y2 and accrued
interest of the outstanding $19,131,000
first
mortgage ■■ sinking
\,
fund gold bonds, 4V2% series due
to
follow
position.seem
demption
Giving effect to this financing,
the corporation's outstanding capi¬
talization will consist of the $14,-
enthusiastic
.
at
1979.
pretty closely the U. S. line on
decartelization, although at times
too
issue
underwriters
basis.
One,®'
not
The
the
to
competitive bidding Nov. 19 on a
bid of 106.2199, or on a 2.723%
BERLIN, GERMANY (delayed).—Officials of the Decartelization
their mission actually has a two-fold
seem
2.70%.
;;
awarded
Branch state that they believe
they
Water Power
at 106.76% and accrued interest to
-
French
Boston
Harbor
yield
Such form of economic organization
The
First
Economic Effects of Longevity
:
Corp.
first mortgage bonds, 3% series
due in 1981. The bonds are priced
unnatural to Germans.
purpose.
Market
on
Corp. and
Hayden,-Stone & Co. are offering
to
the public
today $14,000,000
economically /
privately-owned, medium-sized and
into
workable and efficient units.
appears
The
By HERBERT M. BRATTER
Special Correspondent of the "Chronicle"
Correspondent reports difficulty of establishing democracy in eco¬
nomic a#airs. This is principally reflected in obstacles encoun
tered by Decartelization Branch of OMGUS in reorganizing German
economy
Placed
Thursday, November 21, 1946
By THEODORE G. KLUMPP, M;D>
„•
'■
■■■)
President, Winthrop Chemical Company
Noting tendency toward more old people in our population, Dr. Klumpp
analyzes question of what to do about the aged and infirm. Decries
compulsory retirement of aged persons as uneco¬
nomic, and cites cases of continued activity and
productiveness of retired professional workers.
Says employment of competent aged workers in
industry
bring about reduced working hours
Impeding progress
can
and lower tax burdens without
of1 young.
Sees need for further advances in old
and study of disease of old
age care
age.
A
century and a half ago, Horace1 Walpole wrote these lines: "About the time,
or
little later, I die, the secret will
a
be
Feeling that
enough time had passed to Vouchsafe a \
reply, Helen Bevington answered:
'•<
found of how to live forever."
Theodore G. Klumpp
"Horace, be comforted to die.
One century has meandered by
is concerned.
And half the next
largely preoccupied with the
diseases of youth and childhood.
Our chief endeavor was to learn to f
run the
gauntlet of infections so
that we might be able to raise a
reasonable number of our children
to adult life. We have not yet fin- |
ished this job and we never will
since, it
In the past we have
been
was
British Zone. There, the national¬
true,:
The temporal state eluded
you. /
being offered, the
Now as I read your pensive
$5,000,000 10-year note and 300,000
Decartelization and Potsdam
letter, >
shares of capital stock, all of which
Officials of the Decartelization
I wish myself that times were
is
owned
by Consolidated Gas
Branch
of
OMGUS
insist that
better
Electric Light & Power Co. of Bal¬
their program parallels and is a
And I might boast how man
timore and Pennsylvania Water &
part of the over-all United States
altogether—but mortality statis- t
y-^v/eontrive/////;^
international policy as set out in Power Co.
As you foretold, to stay alive. ;
The new bonds are
tics show that we
have made;
the Potsdam Declaration," in the
By now we should possess the
great advances for .which our
redeemable at 109.76 to Oct. 31,
Atlantic Charter, in the Lendkey
physicians, research workers, and
Lease Agreements, and as imple¬ 1947, and at prices declining to
To fleshly immortality
v
public health officials, can feel
mented by the International the principal amount after Oct.
And, if we wanted to, endeavor
justly proud.
To live forever and forever.
Monetary Fund, the International 31, 1980. They are also entitled
But as a result of our success
:
Bank for Reconstruction and De¬
in conquering infections and some
This, to my infinite regret,
>
to the benefits of a sinking fund
velopment, the reciprocal trade
Is not a custom with us yet.
; : of the most deadly diseases of
beginning in 1957.
treaties, etc.-.
j
V \
I write you Horace for good cheer childhood, we now have an adult
Safe Harbor Water Power Corp.
The Soviet position seems to be
population that is larger in pro- ;
Life is about as usual here."
owns and operates the Safe Har¬
portion than it has ever been be¬
emphatically on the side of deUnfortunately, life is about as
fore; It promises' to grow fcven
concentrating the German econ¬ bor Hydroelectric Project at Safe usual here so far as our knowl¬
greater as the years toll by. This i
edge of the nature of the aging
omy, also, into medium size and Harbor, Pa., on the Susquehanna
poses
new
public health prob¬
The project has. an effec¬ process and many chronic diseases lems, and hitherto neglected dis¬
small individually operable units River.
ization of Coal and steel, and the
and
using of cartels to serve British
stand they have taken on decon-
The-corporation does not supply
Military Government functions, it
centration and decartelization. The
electric
is
Soviets, however,
public but is operated as an integ¬
v
about it.
'
.
bonds
000,000
Herbert M. Bratter
possible in
as
form
the
small-
or
medium-sized
of
efficient
competitive units. This policy, they
point out, is simply in a manner
of speaking a little bit of Americarnsm
of
fit
Quick to point out that this pro¬
gram means actually that German
,
production will not lose thereby
but, in fact, is likely to gain,
This
American
decartelization
policy, of course, is contrary to re¬
Berlin
reachirig
ports
the
from
pointed out by certain Ameri¬
can
Military
cials
serve
hands
of
be
offi¬
Government
cartelists
and
system which
turning
as
as
can
ral;
to emphasize
seem
over
well
tive capacity of
the
in
of such units to
to
seem
national
•
230,000 kilowatts
services
part
power
of
directly
an
ties
agencies.
to
the
system comprising the elec¬
of
the
and facili¬
corporation
to the formation of stock corpora¬
Consolidated
during the 30's. The word "car¬
tions in regard
and Power Co. of Baltimore and
te^ of
course,
many
of these
Gas
connotes restric-
(Continued
on page
Electric
Potomac Electric Power Co.
.2647)
Light
•
,
,
.
an
offer to sell*
nor
a
solicitation of
an
offer to
securities, The offering is made only by the Prospectus.
buy
•
;
any
,
of these
'
fore
part
|
technical
r-
.
the
has
been
in
large meas¬
viously with Cruttenden ^ & Coi,
margin accounts. Despite
Samuel B. Franklin^ Co. and the
three distinct selling drives during
the past few months, no appre¬ Bankamerica Comi\|i\y. C
/
————*j;^
ciable downside headway has been
for
ure
43A% Cumulative Preferred Shares
par
i
however,
that
balance
29,192
($50
,
position. In¬ Buckhout With Livingstone
point to the
(Special to. Tmb Financial Chronicle)
present position is
LOS ANGELES, CALIF.—Gor¬
strong. Practically all of the buy¬
ing for some time has been on a don E. Buckhout has become asso¬
strictly cash basis'/ so far as can ciated with Livingstone & Co., 639
be observed, whereas selling on
SoUth Sprine Street He was pre-;
assailable
dications,
Paper Mills
2614)
(Continued from page
fact
Morris
/
of next year, any further temporary adversity
barring unexpected calamitous de¬ so that adequate cash reserves will
be^vailable tp participate in what,
velopments..
t
the
It must be conceded of course may very well be one of
that it cannot be proven statistic¬ greatest of all major upswings. ; t /
ally that the market is in an un¬ )H-:i.?'&-■<^,:■;'v-SS;,
the
v
This announcement is neither
(Continued on page 2620)
•.
Key to
Stock Maiket Prospects
into
.
The care of the
Business Outlook
Pennsylvania Water & Power Co.,
to subscribe completely
compelling impor-i
aged and
chronically ill must not be left to |
assume
eases
tance.
tion, Cleveland, O., Nov. 14, 1946.
itself,
repossessed by those who ran it
to
% *An address by Dr. Klumpp be¬
fore the Annual Meeting of the
Aiherican Public Health Associa¬
interconnected
trical power resources
governmental agencies, not,
however,
readily They
be
can
emphatic
are
determined,
local
monopolists and simply preserve
a
they
the
only to strengthen the
the
.
,
brought over for the bene¬
Germany. They are also
r
made. Prices still stand above the
value)
lows of the year and at about the
mid-September
Price $50 per Share
level.
Pure 1
(Special to The Financial
y
and
quality
magnitude
of
/
Chronicle)
CLEVELAND, OHIO—A. Julius
technical studies indicate that the
(Plus accrued dividends from October 1, 1946)
—-—
With Merrill Lynch Co.
the Weidenkopf has become associated
bpying during, these, three , dis¬ with Merrill, Lynch,
Piercg,rFentinct selling climakes could hardly
ner &
Beane, 216 Superior Ave¬
be
predicated upon the prospect
relatively limited recovery nue,
of the
that has occurred thus far.
54,486
.
Ultimately
Common Shares
l"i"
($10
par
value)
1
Such
-
•"*
be
"Price $18 per Share
"
'
L
,
.
u-j
*
\
can
validly upon the thesis
based
that (1)
Hi
'
contention
a
in
the
army
of
investors,
previously
& Co.
Slayton & Co.
(Special to The Financial Chronicle) >
the money base is far big¬
and broader than ever before,
(2) the war created a vast increase
market
was
McAdam Joins
OHIO
TOLEDO,
ger
«
Copies of the Prospectus are obtainable from only such of the undersigned as may
legally offer the securities in compliance with the securities laws of the respective states.
He
E.
in the
postwar stock market (not neces¬
sarily in 1947) will no doubt be
t
recorded.
1
high
new
a
N.
with Hawley, Shepard
—
Wilfred
J.
McAdams, is now connected with
potential stock Slayton
and (3) the Avenue.
8^.Co.,
Inc., 520 Madison
•-
world-wide demand for goods and
services
-
Hallgarten & Co.
of
edented.
all
kinds
•
■
/-■-
'/
is
unprec¬
It is not our intention to
Hornblower & Weeks
November 21, 1946
Shields &
Company
gest
that
difficulties
interim
should
P, R. Smith & Co. Adds
' •■•]
(Special to The Financtal Chronicle)
sug¬
readjustment
be minimized,
,
ELYRIA, OHIO—William Aker
has become
associated with P. R.
Elyria Savings &
Rather/it is stressed that all port¬
Smith
&
folios should be in a more or less
Trust
Bldg.,
impregnable position to withstand
Cleveland Stock Exchange.
Co.,
members
the
of
•
•
■
THE COMMERCIAL A FINANCIAL CHRONICLE
Number 4544'
.Volume 164
2617
Stock Maiket.
This is not
Pessimism
x-
Offering Prospectus.-The offer of these stocks is made only by
an
of the Offering Prospectug.
means
These securities, though registered,-have not been approved or disapproved by the Securities and..
'
Exchange Commission, which does not pass on the merits of any registered securities.
f
■
Not Warranted
By COL; HERBERT G. KING
James Lees and Sons Company
Member New York Stock
Exchange
'
Stock
'
Exchange member points
brighter outlook.
30,000 Shares 3.85% Cumulative Preferred Shares
<
out factors for
($100
'
-
f.
The present
wave
in the stock market has greatly
expec
what
t
is
'''-"y:•> *•:'
The Preferred Shares
.
($3
value)
par
;
..
are
.
v.
-
r
i
"""
_
An annual sinking fund payment equal to the lesser of (a) $60,000 or (b) net income for the preceding fiscal
year after
,v.preferred dividend*is itrbeapplied to the retirement of Preferred Shares through purcliase'or redemption.
\
that
one
-
redeemable, at the option of the Company, in whole or in part, at any time on 30 days' notice at
$107.50 a share on or prior to November1,1951 and thereafter at $105 a share, in each case plus accrued dividends, •
'■
P:
and are also redeemable through operation of the Sinking Fund on November 1 of each year,
beginning , *
1948, on like notice, at $105 a share plus accrued dividends,
.....
V''^>:*- -.V'%.*1 *'• -V *» v
N '
°
A'*, 'V*' V'-"' '
*'•'A ;V
V'V,'' .v; ■ '"i*,? 'i'. ' -H •:.
"• ••••.'»' •/*f'.'
r.
h o u 1 d con-
vince
v'' ' : ■';■'■■■
be
about
-s
■■■'.: A
14,399 of these shares)
as to
203,833 Shares Common Stock
ex¬
ordinarily to
little
thought
impending events
<
A
:
•
"
d. A
e
exchange offer
an
A.•
v:;;;;
of pessimism
that has resulted from the decline
ceeded
[The Company is making
;
value)
par
.
the
gloomy.
Aprognostica- ?
tions of many '■
stock
traders
not
are
In the opinion of counsel, the Preferred Shares and Common Stock
vania, and the Preferred^ Shares
New Jersey, New York, Ohio,
I
is
;
should
to be a
Col. Herbert G. King
pleasant^ *
;
surprise to many" of pur presentday Cassandras.
'
.thk
*
we
'-1
.
*•"
' ^
'
'''(T*
-
^
..
CommonStpckomthe New York Stock Exchange,
"
.v.,
f
'
t
.
-r''
;
' '
"
*
L
;
,
"
--
a
Outstanding
•
„
A
.
u
-
'
f7% Cumulative Preferred Stock ($100par) (authorized 19,337 shares)
\\3.85% Cumulative Preferred Shares ($100 par) (authorized 30,000 shares)..
'Common Stock ($100par) (authorized30,000 shares)
Common Stock ($3 par) (authorized 1,000,000 shares)
t7*o be exchanged or redeemed and ccnceUed.series of Cumulative Preferred
50,000 shares
are
authorized. 14,399 of the above 30,000 sha
des are
to thiar
30, 1946
(shares)
.
i
i
~
Citing effect
•
vava- September
i
.
"
^
.
financing
'
;
"
(shares)
14,399
None
None
24,525
None
t;
30,000
;
V
Shares
.
None
817,500
V
(tlOO par) of. which '■1
•'
.
being offered by the Company in exchange
e-shars^for-share basis for the 14,399 shares of 7% Cumulative Preferred Stock. 'Since September SO, 1946,
the Common Stock (f 100 par) has been split qn a 3314 for 1 basis.
on
'
At
The net proceeds
j: " op issue
se¬
,
September 30,1946 the Company had short term bank loans outstanding in the amount of $500,000.
purpose
se¬
(estimated at
maximum of $2,972,500 and
a
minimum of $1,514,601.25 after
a
expenses) from the sale of 15,601 Cumulative Preferred Shares and such Cumulative Preferred
1
Shdres
taken in exchange under the Company's Exchange Offer will partially reimburse
working capital for expenditures made and to be made in the erection of a new mill at the Glasgow plant and will
be used to redeem the unexchanged shares of 7% Cumulative Preferred Stock. The Company will receive no
part of
-
curities
outright and are inter¬
only in their income, can¬
not be frightened into sacrificing
them. The current selling prices do
not worry the holders when they
feel certain that eventually they
will see much higher prices.
that
»
.
The Company operates four plants, including its yarn plant at Bridgeport, Pa.,arid its carpet plant at Glasgow,Va.
ested
evident
The Company has no subsidiaries.
CAPITALIZATION
lower.
is over and the twenty million
curity holders who own their
-
•
yarns; The Company sells carpets, rugs and. hand knitting yarns directly to
retail outlets, carpet yarns to other carpet manufacturers and worsted
knitting yarns to manufacturers of knit-
wear-
True, the
Dow Jones averages have dropped
from 212 to 163, but there are a
great many factors that should
not be
disregarded. Corporation
earnings are high, dividends are
large, the future of business is
very bright as it will be sometime
before pent-up demands can be
satisfied, and controls are being
lifted. -Forced liquidation of stocks
go
Compahy's brief outline of certain information contained in the Offering Pros-
| worsted knitting and hand knitting
hear it said that
;we are in a bear market and that
is
-"»
pile carpels and
'
It
——
company,James Lees and Sons Company, incorporated in Pennsylvania, in 1895, succeeded to a business■ >
" ■
originally established inl846. The Company is now engaged in the manufacture and sale of wool -J?
rugs of Wilton, Velvet and Axminster weaves, and wool yarns, including woolen carpet yarns and
-A
:
very
will
Shares and
The following is the
-
prove
prices
' y
Company will make:application for the listing of the Preferred*•>
,pectus and is subject to the more detailed stateMpiits iti the. Offering Prospectus and the Registration.
Statementf which also include important information n,ot outlined or indicated hereini. The 'Offering,
yprospectu&should be read prior to any purchase of these stocks.
bright-"'
On all sides
Virginia and Wisconsin and for trust funds in New Jersey.
'*•
\
*
lifess and cheer
and
"
'
^
1
"
The
of consid-
erable
„
'v l/J'
/
|
war¬
the outlook
a
"
|
ranted. In fact
one
are
exempt from personal property taxes-in Pennsyl¬
legal investment for life insurance companies in Connecticut, Iowa,
are
•
■
as are not
the proceeds from the sale of the Common Stock. The Common Stock, which is issued and outstanding, is
being
sold
by certain Selling Stockholders.
EARNINGS.
,
.
}
The following condensed summary of earnings of the Company and its former subsidiaries has been
;
: •
prepared by the Company and has been reviewed by George K. Watson & Company, independent
public accountants. This summary is subject to the financial statements and summary of earnings in the Offering
Prospectus together with the notes thereto.
f
1
.
.
Income
the political
'
tax pictures are much
brighter for security holders and
the prospects for a period of pros| perity for this country lasting sev¬
eral years are in sight. Labor has
reached a point where it must co¬
operate with management for the
good of all. International trade is
being stabilized which will permit
long term contracts and credits to
be made and arbitrage with for¬
eign markets resumed. Europe and
Income and
tm
'"Net
Year
$15,285,064
1937
14.024,929
1938 ' 11^347,464
1939
14^792,253
1940
16,835,817
1941
26,684,922
1936
873,922
$
$
I\et
1,631,578
1942
^
.
.
Provisions
'$1,161,840
'
-
,
Provisions for
for.
Contingencies 'Contingencies
Sales
1
Net Income
.
' v.
•'
149,023
1943
72,750
1944
$22,413,170
25,890,441
25,375,954
1,690,758
1945
22,525,i73
1,985,799
665,079* $
603,692
1,740,985
1,016,028
21,647,604
4,832,287
1,976,000** 2,856,287
'
36,937
687,859*
924,398*
1,602,220*
2,695,960
Net
Year
on
Income and
Income and
on
■
^
632,175
29,220
109,687
1,778,617
'
.
' Income'
$
241,747
178,243
-
1
for
Contingencies
Contingencies
.
.
,
Taxes
Before Taxes
Provisions
Provisions for
Sales:
*
Income
on
.Income and
Before .Taxes
*
and
Taxes
707,180
,
'
$
1,300,521
2,615,587
496,761
696,829
.
874,602
909,771
\9mos.)
1,093,740
1946
*Includes Provisions for1 Contingencies: 1939, $300,000j 1940,
$$00,000} 191)1, $150,000; and 1942, $150,000, **EstimOted,
dividends
The-Company has paid cash dividends varying in amount on its Common Stock in each year
since 1895, inclusive, except 1938. The President of the Company intends to recommend at the
January, 1947 meeting of the Board of Directors of the Company that an initial quarterly dividend of 35c a share
on the Common Stock be paid on March 1,1947.
y
have
Asia
to
of
the
be
rebuilt
and
the
preferred and
efects
the
British
The Cumulative Preferred Shares have
common stocks
and
Loan,
as
credits of the Import-Export
Bank and the International
have
voting rights except certain special voting rights
specified in the Articles of Incorporation. The Common Stock has one vote per share.
no
The Preferred Shares and Common Stock will be fully paid and non-assessable,
except for
statutory liability for salaries and
Bank,
to
be felt. To the
thoughtful investor, the future
looks very bright indeed. *
yet
.
'•
not taken
i
.
'
f{/,
wages*)
•
.
-
,
.
VNDERWRITING
,,Subject to certain-conditions the Underwriters named in the Offering Prospectus have, severi
ally agreed to purchase 15,601 Preferred Shares and such of the 14,399 Preferred Shares as are
in exchange under the Company's
Exchange Offer at $100.25 and $102.50, respectively, a share and accrued
..
dividends and the Common Stock at $24 a share. The aggregate offering price to the public of the Preferred Shares
is a maximum of $3,075,000 and a minimum of $1,599,102.50 and accrued interest, and of the Common Stock is
$5,299,658. The aggregate underwriting discount on the Common Stock is $407,666 and on the Preferred Shares is
$67,500 maximum and $49,501.25 minimum, dependent upon the number of shares taken in
exchange
II
under the
.Company'sV:;.
*
Business
'
's
i-
-
'
'-•<
v
■'
''
•:
-
'
''
"A*'
*
"■
'""■■■■*"
v
i
■*. wi "■ ."■ * I..* ■ ■'i
■■
v.'
'* «' i;,,1 '■?'v;
•
%
!r,>
Price of the Preferred Shares $102,50 a share
and accrued dividends
,
-
-
Price of the Common Stock $26 a share
-
Bookshelf
TJie Underwriters have agreed to purchase Preferred Shares when, as and
if issued, and the
Common Stock, both subject to the approval of Davis Polk Wardwell Sunderland fr Kiendl, counsel for
ence
to
the Underwriters and Montgomery, McCracken, Walker 8? Rlioads, counsel
for the Company and the
Selling Stockholders, and bo certain further conditions. It is expected that delivery of certificates for the
Preferred Shares and Common Stock will be made on or about November
1946fagainst payment
therefor in New■ York funds,
<
.
1
"
•
and
resources
to facilitate
South American Handbook, The
♦
—1946
Edition—Guide and refer¬
countries, products, trade
of Cuba, Mexico,
Central
and
South
America —
Ltd.,
don
Travel
and
Trade
••
C.
3,
offering.
it is intended
to
stabilize
this statement is not an assurance that
UV.-
Publication,
14 Leadenhall Street, Lon¬
E.
the
prices
of
if commenced, may not be discontinued at any time.
7;
,v
Further information, particularly financial information, is contained in the Registration Statement on file with the
'
V
England—Distrib¬
that "pub stabilizing,
* ;
'
Commission, and in the Offering Prospectus which must be furnished to each purchaser and is obtainable
from only such of the undersigned as may legally offer these securities in compliance with
'
+
"
utors: H. W. Wilson Company,
950
the securities laws of the respective States.
^
•
,
,
>
,
-
University Avenue, New York 52,
N.
Y.—Fabrikoid—$1.25.
MORGAN STANLEY & CO.
;
BLYTH & CO., INC.
Transport
Coordination
in
United States—P. Harvey Middle-
ton,
Railway
Business
DREXEL & CO.
THE FIRST BOSTON CORPORATION
HARRIMAN RIPLEY & CO.
the
Associa¬
EASTMAN, DILLON & CO.
,:4
v.
■
~■
Incorporated
'
vA;-;-v-'*" A-'
KIDDER, PEABODY & CO.
'
MERRILL LYNCH, PIERCE, FENNER & BEANE
SMITH, BARNEY & CO.
tion, First National Bank Build¬
ing, Chicago 3, 111.—Paper,
.
r
V
Dated November
21,
1916
.
-
•»>
,
the preferred shares and common stock.
the prices of the above securities will be stabilized or
the
>
.
■
.
'
(
-
•
u
•
.
'
1
1
substantial
Federal Reserve Board
workable.
W
credit is
Board
be
general be in the
in
the
past
form and scope of this revision in
"order to be an effective influence
1941, which
any
controversy
various groups affected by
among
it.
or
in
sharp
of
subject
to
as
should
continued
of Con¬
whether
should not
form is a
action
by
issue
regulation
by the
revocable
is
or
The
gress.
be
Order
Executive
an
rests on
of Aug. 9,
now
The Board feels that the issue
should
be
decided
the
by
Con¬
and that the present revi¬
gress
household appliances;,
phonographs, sew i n g
machines, furniture, and softsurfaced. floor
coverings, but
time, however, the expansion
and
subsequent
contraction of
consumer credit have gone so far
to-
as
to accentuate the
exemption for any ar¬
less than $50>. "
2. Restrictions on charge accounts
with
upswings and
downswings of the business cycle.
is
There
and
of preventing
way
no
ulation
-
the
of
terms
shall
credit
consumer
on
or
required
all
made
permissible
time
length
the
or
provisions for refinancing,
with
including consolidation
instalment
for
arise from sales
loans.
4. The
of
credits,
instalment
new
whether they
instalment sales
on
and
financing
established for
of 15 months is
available, such as the down pay¬
ment
are
maturity
3. A uniform maximum
which
be
single-payment loans
eliminated.
such excessive expansion and con¬
traction except governmental reg¬
credits, are simplified, and
new
contracts."
of
The
Regulation is now revised
refinancing credits may have a
bringing before the Congress the
in the
light of the foregoing con¬
maximum
question of whether the Executive
siderations.
sion
is
an
appropriate
should
Order
vacated
be
whether authority for
specific legislation.
•
In
its
last
gress
ommended
whether
that
regulation
be
by
'
/
■
,
Con¬
major
in
the
accounts
a n
of
dollar bulk
single
Charge
payment
-
small,
are
elimi-
the nated from the scope of the Regu¬
of
15
are
down
transferred
iiave
payment
scribed:
as;
.
to
the
.20%
a
the items re¬
payment,
tained
for
calling
category
coverings
floor
for
Except
which
the widest ex¬
in which fluctuations are
loans,
comparatively
5.
goods, which
great
d
in¬
categories
durable consumers'
of credit subject to
consumer
factor
loans,
of pansion and contraction.
continued on a
contributory
12
cluding
instalment
instalment
and
sales
focused on in¬
both
constitute
peacetime basis as a subordinate
but
credit,
stalment
rec¬
question
of
the Regulation is
maturity
months.
revision,
Under this
give
Congress
the
to
credit should
;
Board
the
June,
consideration
4
f
Report to
Annual
or
such regu¬
continued
be
should
lation
means
the
same
^ny
an
offer to sell, nor
a
such
ment
Haiseyr Stuart Offers
Suction Cleaners
Down:
Weatherhead Debs.
Furniture
Soft-surfaced Floor Coverings.
Halsey, Stuart & Co. Inc. head-*
ed a group Nov. 20 which offered
$3,000,000
serialdebentures of
The Weatherhead Co; due annual;?
H. Heitfz SeSebrales
ly from Oct. 1, 1952 to 1966 .at
prices yielding from 2.35 % to
Ninety years of brokerage serv¬ 3.50%,
according
to
maturity1.
ice under the sams name was cel¬ Proceeds from the sale of the de¬
ebrated. Nov. 15 by H. Hentz & bentures are to be applied to pay¬
ment of the company's outstand¬
Co., 60 Beaver
Street,'.
New
ing bank: indebtedness, purchase
York
; City,
of machinery and; eqi^mentjad^
members
of
ditionaL working capital and pos¬
thq New York
sibly for acquisition and rehabili¬
Stock
Ex¬
tation of a plant which is current¬
change,
the
ly being operated tinder lease and
New :
York
the leasing and equipping of an
Cotton
E xadditional small plant.
change
and
Net sales of the company in
nearly a score
1945 were reported as $26,847,133
of other com¬
and net profit before interest and
modity
ex¬
taxes on; income was reported as
changes in the
$1,320,315; maxhnuni annual
United States
terest requirements on the de¬
and abroad.
bentures will be $92,650, For- the
The
Ninetieth
Anniversary
skyline
financial
trict
dis- :.
in
sides
by towering masts and the
of clipper ships when
Henry Hentz put -up his sign, H.
Hentz & Co., at 5 Hanover Street,
New
York,
as
the
state¬
York
The ' New
then
was
a
,
Company
£-v':S
Henry
around
sified its
:
of
•'Hentz'
which
cotton,
aviation, refrigeration, liquefied
petroleum gas and other indusjtries. Its principal products injclude high and low pressure fit¬
tings,; valves, carburetor parts,
drain
and; shut-off cocks, dash
controls, hose assemblies, miscelr
laneous. parts for mechanical re-and air conditioning,
he frigeration
pressure
as
President
screw
'
/j;
from
1874 to
Exchange
the Board of Man¬ New York Stock
Was oil
and on various committees
which were instrumental in ef¬
years
ganization of the New York Cot¬
Price $24.50 per share
ton
Exchange
Weeky Firm Changes ! ^
Exchange
in
1870, arbitrage
circulated from only such of the undersigned and other dealers as
ers
lawfully offer these- securities in such State,
of the' Coffee Exchange .of the;
New
City of New York, now the
York Coffee and Sugar
Exchange,
Hentz
securities, business
Co.
&
was
given
of
H.
the New
York
Stock Exchange firm of
Baruch
Brothers
was' merged
with it.
This union, which fol-f
(Incorporated)
Paine, Webber, Jackson & Curtis
lowed
the
Hentz by
November 20,
1946
i
M
t, I' fl «
»1
M >.*
11 it u <» / ii.U i t
#
if
i * ■,, ' ■». /»
y •;* « t \ *
•;>
>»+|r
■
* ■ « i l.tiHf* >•» w >•»,>■ » «.» >.»
f* .»
retirement
of
Henry
three, months, made Dr.
Herman B.
ner
a
Rudolph Reimeiy limited par|J
in Reimer &
Co., will become
general partner effective Nov.
on
along
Baruch
with
a
senior part?
Jerome
geman
which date Harry R.
Lewine,
En^
wiR retire from the firm. !
Thomas Jordan & Co. retired
special
emphasis in 1918! when
Central Republic Company
«
ner
,
The
Kidder, Peabody &Co.
Incorporated
William J. Banigan retired frorb
partnership in Cohu & Torrey on
21*
Inc.
A. G. Becker & Co.
.The New York £tock Exchange
announced
the
following
weekly firm changes:
has
operations between New York and
Kenneth
F.
Dietz
Liverpool. then, became an imporrj
withdreV
tant part, of " the business. , Mr. from partnership in Halladay &
!
Hentz also \yas one of the found¬ Company on Nov, 15.
The Prospectus may be obtained in any State in which this announcement xV
Corporation
-r-
■■p— '
and for many
1876
fecting • improvements and reforms
in trading practices. After the or^
Lee Higginson
turbine engines, and special
machine products.
gas
served
Hentz
of the New York Cotton
ager s
may
and flow regulators for
II. Hentz & Co. ^diver¬ liquefied petroleum gas equip¬
commodity operations in ment, fuel: control mechanisms for
the next 20 years.
($5 Par Value)
,
the sole proprietorship by
J.
Albert
manufactured for the automotive,
Mr.
i
a sue-*
business established in
OntV A wide range?of products is
of Drew and
era
Built
251,340 Common Shares
*
as
a
Van-
the
Orleans,
,•
to
derbilt, of Gould and Fisk.
A
building boom was under way in
New York and in that period it
was:i measured in terms of 3,009
dwellings erected in a single year.
The panic of 1857 was just ahead
and. not far beyond loomed the
disastrous Civil War.
Keg. U. S. Pat. Off.
•.
Weatherhead Co. is
The
cessor
President
had learned from an uncle in New
;
income.
Weatherhead, Jr., the
of the company.
Its
covering the transaction booming port handling 35% of the
country's exports, discount rates principal manufacturing pliant is
were 9*%
to 1Q% for * first class in Cleveland, Ohio, with other
paper, call money was "easy" at plants in Columbia City/ Angola
7% and speculation was heavy. It and Warsaw, Ind., and St. Thomas,
matters
knowledge
:'... '
available for interest and taxes on
1919
Nov. 15, 1856.
on
sales of $17,-
three 824,896, with $619,390 net profit
on
which is riggingsimplified
reported net
pany
.
.
hemmed
\yas
first nine months of 1946 the com¬
Jerome Lewine
of New' York's
pre¬
of these shares. The offering is made only by the prospectus.
1
*
Sewing .Machines
20%
solicitation of offers to buy,
Felt and Tarrant Manufacturing
Rotterdam.
Radios and Phonographs
.
was
This announcement is neither
portant European cities, such as
London, Paris, Amsterdam and
'
in the 20 % category.
6. Procedural rules are
1
firm
maintained branches in other im-*
.
;
Air Conditioners
33 Y3 % for all articles
other than furniture
in
1
•
down
presently
and
Hesse
conduct? branch of¬
fices at Detroit, Michigan; Chica¬
go, Illinois; and Pittsburgh, Penn¬
sylvania, as well as at Geneva*
Switzerland.
Before the war, it
an
ticle costing
Clayton, John
Kaplan,A Stanley
The
'
major
radios,
Chicago, stated:
President
.
consumers' .durable
ly to the mass production of con¬
sumers' durable goods. From time
important and strate¬
an
-»
Dishwashers
gic place in the national economy.
Such financing is essential to the
mass distribution and consequent¬
occupy
H<
Jose M. Covo.
follows:
as
Refrigerators
Cooking Stoves and Ranges
Washing Machines
Ironers,
j
'
.
goods to which* down payment
and maturity requirements ap¬
ply is reduced from 36 cate¬
gories to 12, the remaining
items
including
automobiles,
stability in this sector of
the economy.
<
'
Commenting on the new ruling,
the
Federal
Reserve
Bank
of
Regulation
The
1. The list of
30 years consumer in¬
financing has come to
stalment
toward
This
"
the revision are as follows:
Bijur, E. Milo Greene, Lewis D.
which
to
•
Automobiles
present
Raabin, Wilbur H.
articles
33V3% down:
would
% • •
principal changes made by
of
are
<
quirements apply is
need to be modified further.
As the report stated, "Over
con¬
a
should
tion
to
peacetime basis, the
believes that the Regula¬
on
ity.
Regulation
the
of
list
sections
\
down payment and maturity re¬
When present inflation¬
pressures have subsided, the
terms
technical
..
members of the'
are
Jerome Lewine, Robert'
P. Baruch, Edmund W. Fitzgerald,*
Arthur J. Neumark, Sherman M.
retained and
as are
simplified.
8, The
direction of
>
firm
.
certain
ary
The
Minor ■ changes reconcile the
hew provisions (with such re¬
quirements
praised.
Dec.
consumer
tinued
the
the only member of
firm" of H. Hentz & CO.
now
required" that a state¬
the f transaction
be thq present firm.
given to the customer.
-
7/
is
"old
of
bilizing influence in this area > of
the economy.
In this form, the
Board believes the Regulation can
be
better
understood
and
its
merits
and defects. ..betterap¬
System
If regulation in the field
goods.
longer
con¬
the
It
borrower,
who is .active in the
ment
vv''V..•/rV -••"Crl'.
to what
minimum
who
obtained
is no
statement
the
sistent with the exercise of a sta¬
1, 1946, the Board of Governors of the Federal
has revised Regulation W by confining it to in¬
stalment credit and centering it^
on
purchases of major durable maintenance of economic stabil¬
Effective
Regulation
the
Board considers a
the
from
:
-5-.^.v**:• -VJ'«»&•
This revision' harrows the scope;
of
durable con¬
sumer goods, including automobiles, refrigerators and large house¬
hold machines.
Reserve Bank of Chicago calls attention to efforts
of Federal Reserve Board to have Congress grant it permanent
power to regulate consumer credit.
Say present revision narrows
scope of regulation to what Board considers consistent with a
stabilizing influence on national economy.
Reserve
;
*'
instalment sales, except certain
on
fl
Regulation's provisions and will
make
it
administratively more
Revised Regulation
Controls released
and
revision effects a*
simplification of the
The
lation.
of
Thursday, November 21^ 1946.-
THE COMMERCIAL & FINANCIAL CHRONICLE
2618
a
member firm
on
Nov. 14.
as
^
Transfer of the Exchange mem¬
bership of Frederick N. L. White
to Sylvester F.
Hennessey will be
considered
the
Nov. 27.
tinue
by
Mr.
as a
Exchange
Hennessey will
on
coiv-
partner in T. L. Watson
Volurtie -164
THE COMMERCIAL & FINANCIAL CHRONICLE
.Number 4544
Ass'n of Stock Exch.
Analyzing Election Effects
■
By ROGER W. BABSON
Marketing Official Sees Need for Food Stamp
Plan to Meet Impending Crisis in Agriculture
Firms Elect Officers
James F. Burns, Jr., partner in
Harris, Upham & Co., was elected
•
had their faults
"I and virtues, says all will not be rosy for new Republican Congress.
Holds people demand revised labour legislation, but labor opposition
may be effective, and concludes, if labor behayes, half Way decently,
} there ought to be a couple of years, of good business.
Babson, asserting both political parties have
Mr.
.
'
Everyone
t i
•
•
of
o n
Stock
Exchange firms at the an¬
meeting of the board of gov¬
nual
Mr.
ernors.
of
the
results.
-
Burns
its
reor¬
aopointed
tion
to the
new
that the
If labor" now behaves half way
Republicans decently, we ought to have a cou¬ Elected to the board for their first
better ple of more years of good busi¬ terms were: Wilburn G. Hoye,
m e nv
a n d
ness.
Furthermore, it should be Chas: W: Scranton & Co., New
women
than in the interests of the Democratic Haven, Conn.;. Albert D. Farwell,
j? arweil, Cnapman & Co., Chicago;
are the Demo¬
Party to have good business in
crats.B o th 1948.
On the other hand, labor Benjamin H. Griswold 3rd,. Alex.
parties have leaders could easily throw a "mop* Brown; & Sons, Baltimore f Lyon
rendered use¬ key 'wrench^into ; thosituation;
if Carter, Estabrook" & £o.; Boston;
ful and patri¬
so,
last week, the Republican Harold P. Goodbody,1 Goodbody &
otic services.
Party may have been given a Co.^vNew :-tprk; i and: fHarl < L,
"headache" instead of a "victory." Bache, Bache & Co.^ New York.
Importance of
Wm. Wymond Cabell, Branch,
Most people believe that the
A Change
.Cabell & Co., fHichmond, Va., the
recent- victory assures /the /elec¬
The
retiring President, was presented
simple tion of a
,
fact
is
that
change
Republican President and
a Republican Senate, as well as a
Republican " House, in November,
a
is al-
~
ways, helpful
afteir u; certain number of years^
Based On pre¬
this will; Comu true.
The Republican Party, owing to
On the other hand, let us remem¬
its strong hold on the people,
ber /that /there; are /exceptions- to
abused its trust. A reaction was
all rules.
It may be that the Re¬
inevitable in 1932. Presidents do
publicans would have a better
3pot make conditions, but condi¬
make
never was
presidents.
r
better
a
man
1948.; -Perhaps so/
vious history;
crats had been forced to carry
■
have
been
defeated
thing
One
just
certain,
is
namely,
^ould hav# the
most ' letailers
greatest Christmas in th^ir his¬
tory. "During the past few weeks
rendered
trade
Christmas
outlook
has
valuablerervic^Itgaye
been'fa:''Rttte,,4UiuJe^ain:;dn^6iUo
"Washington a house-cleaning communities because of the fac¬
in Its
greatly needed. $ More¬
tory layoffs and the stock market
break.1 I am sure that this will all
<'New-.vDeaf,^^ai-inuchi
favor:and for many years
only a fair deal/ The
forgotten for the next two
months.
The election should re¬
tion owes a lot to the Democrats
vitalize
every
community
and
Tor their courage in giving prompt
most consumers.
The only ones
aid to England and in the waging
who will economize on Christmas
Of the; war^ The Roosevelt ?Adn
purchases will be government em¬
ininistration was very wasteful;
ployees who know they are to lose
but a Republican Administration
it
was
be
their
iyith;, its strong isolationist s elb^
rment
(Special to
The Financial
Let
might have been too late in
add that it may not be
me
too much of
getting into the conflict and too
^OOnomioaliWhen waging the war.
who
a
misfortune to those
these
lose
government jobs.
viously
prior
in
the
thereto
S.
Navy
and
Brailsford,
with
*-y •
..:v:v.^^C'i'
News that
be had free for the asking by the
in
tions
of
York
area
again
on
the
metropolitan
throws
problem 6f surpluses becomes,
sense, as important as it has
ever been. He bases his opinions
New
upon the presence of the
three factors:
the
spotlight
aspects of .the
national farm problem which, ac¬
cording : to Chester A.
Hainan
himself, marketing director; for
the Department of Agriculture in
New. York, threatens to assume
certain
1. UNRRA is
which
the
coming
proportions
year
Federal
or
so.
Financial Chronicle)
Hart has
Bosworth,
—
Robert M.
become associated with
Sullivan
&
Company,
cials
Seventeenth Street.
formerly an officer of Welsh,
Davis & Co. in Chicago.
Working for the government, as a
rule, is not good for most people
What, of the Future?
as they become stale, and ineffi¬
All will not be rosy for the new cient//, Employers 'do not like to
Republican Congress. /The people hire people who have worked for
«demand a revision Of the Wagner the govefnrhent too long.
Hence,
-Act and legislation whereby labor it may be "a kick upstairs" to be
jmust be Subject to the anti-trust kicked out of a government; job
laws.
Whether
the
Republican even as a. Christmas present!
Congress Will have the courage to Everyone should try to get into a
Onact such legislation—especially business whereshe/c^mdu his^ut^
««ver the President's veto if necesmost and get rewarded for his re¬
aary-*-is uncOrtairf/ It IS also'un* sults.; This may best be accom¬
Jknown* how as to/whether labor plished/by getting a position ip a
>
of
the
various
countries
signed to maintain farm prices at
90%, of parity (figured as the
average for the five years pre¬
vious) and destined to continue
uted
of American aid
for two years following the offi¬
cial declaration of the cessation
of the war "emergency," as Mr.
a
in agriculture,
a
feed
to
armies
their
bent
on
adventures of all sorts.
Agricultural production which
in
some
countries,
such as
France, fell to approximately
25 to 40% of normal during the
period of military occupation in
the war is now up to about 75%
of normal, and increasing, Mr.
Hainan estimates, ...
2.
in
crisis
depression of sizeable proportions, should one develop as
some people fear^ would like¬
3. A
.
nevertheless,in
Mr.
Hainan's
view, since the make-up of Con¬
gress
has changed / considerably
and its views on such subjects as
subsidiaries, and/parities are any¬
thing but clear.
Mr.
distrib¬
have
the
supplies to political
favorites or have used the food
crisis could be de¬
of somewhat Uncertain dimensions
rather
perhaps }; but
portentous
Mr. Hart
660
wan
of
which have been the recipients
veloping
The
ardor
committed to the purchase of sur¬
plus farm crops in a program de¬
the nature of
(Special to
the
Hainan, has been cooled
by the revelation that the offW
is
prognostications, I something
DENVER, COLO.
but
:
to Mr.
r
Government
earth
eagerness ; to
ship
food to other lands, according
within
;
seeking funds with
on its task; ol
carry
American
.
tremendous
to
following
feeding the hungry peoples of
with William Blair
'
'.
a
Hainan points out. If Mr. Hanlan
is anywhere near correct iii his
Robert M. Hart With
Bosworlh, Sullivan Co.
•
the
hospitals, orphanages," schools and
other non-profit-making: institu¬
Rodger & Co. Mr. Mahoney was
& Co.
-v.""
•'z
came out
of the New York marketing office of the
U. S. Department of
Agriculture last week to the effect that literally
tons of Long Island potatoes
may^
_
The
H,
U.
;
/"V'-V.
Chronicle)
CHICAGO/
v;/;/,
Agriculture office in New York, threatens to assume tremendous
proportions. • Believes farmers1 market today is a shrinking one
and that as a consequence, questions of
surpluses becomes as
important as it has ever been. Feels matter of parity - will also
become complicated in
years just ahead, because of a general
reduction in production costs from wider use of
machinery and
introduction of mass production methods on a rather broad scale
by farmers.
the
J.l.O'Brien & Co,, 209 South La
Salle Street, members of the New
York
and
Chicago
Stock
Ex¬
changes. Mr. Kershaw was pre¬
Chrstmas Outlook
the
which it
Mahoney
With J. J. O'Brien So.
have become affiliated with John
not now.tell»
The Democratic Administration
over, the
Kershaw and
the
Even if Franklin D.
Roosevelt/ and his friends had
campaigned for Mr. Hoover/ he
■would
silver service..
a
We can¬
bag for two more years.
bertHoover; but conditions de¬
feated him.
with
opportunity in 1948 if :the Demo¬ Kershaw andt John; S,/ Mahoney
There
/
than Her¬
:
of executive Vice-President,
are any
tions
1
nosi-
was
mean
i
.
President
was
association after
Sidney L. Parry, Vice-President
Business Outlook
This does not
Roger W. Babson
By EDMOUR GERMAINE
Presence of surplus stock of Long Island potatoes throws spotHgrht on certain aspects, of national farm problem which, according
to. Chester A. Hainan, marketing director in U. S.
Department of
,
ganization in 1941 until he entered
welfare of the country
the armed forces in May 1942.
Democrat—should be happy, about the elec-
whether Republican or
-
Association
the
the
interested in
is
who
of
President
2619
.
wise
aggravate the farm prob¬
lem
by. further reducing; the
ddmand for agricultural
prod¬
ucts fronr consumer inability to
Hainan^ believes that
farmers' market today-is a
the
shrink¬
to
maintain
ing market and that, consequently,
levels
present
because
purchases
(Continued
of
on page
of
unem-
2649)
-
will
lor
get into
buy
Tight. ;ihore/ bitterly
as an
any
only and is under
offering of these securities for sale,
of such securities.
or as a
Shares
securities
cifctpn^nqes to be construed as tin offering of thm
for'salef
securities; The> offei' is -made only by
means
of the Prospectus.
(Par Value $100
t
tq buy, or as a, solicitation■ of dn^offer
or as an offer
to buy, any of such
rj.4.
■■
A% Convertible Second Preferred
no
circumstances to be
Kimberly-Clark Corporation
or
-
This u finder
no
solicitation of an offer to
The offering is made only by the Prospectus.
70,000
cellar" small/ community in a homewill owned concern Where it will not
than ever be/ necessary for you, to belong
to a labor uniom *.
'
\
^efpr^SSiM^
s ■
construed
"cyclone
a
next two years,
the
This advertisement appears as a matter of record
per
;/
"■
;;
Stock (Cumulative)
Share)
</;
■■
•
NfcW ISSUE
November 21,
1046
Price
$14,000,000
$101.50
per
Share
(plus accrued dividends from November 1, 1946 to date of
delivery)
Safe Harbor Water Power
'
-
-
Corporation
'
<
'
i
/-*
First Mortgage
pated November 1,
: u:
Copies of the Prospectus may be obtained in any State from
Bonds, 3% Series Due 1981
Uoe November 1,
;.i a;
1949;
.
Price 106.76% and
:
•
}■ >:
■<
-
:■
i
.
*■'/:
'
k*-,;
V'j.w i
W;
-•
\
\
.
T*
-A'; £:> V
•
i r
.
only* in-States in which"SttcJ]k underwriter is qualified to
in
V.\
v
^
^
r'/: "7'.
V-,rv-.
'-*T
v;.
'
1
;"'*"/■*
:
•*;
-v.'.' "
'■•T/'r
The First Boston Corporation I;
The Wisconsin Company
*
Hallgarten & Co.
,i'■ l--iv
;V'y;'
Tf
Lehman Brotto
act as dealer
securitiptrandi in which,, such Prospectus may * legally • be. distributed,
r
f-
V 7,1.'I* iv,*''1
k
;>"•
Copies of the Prospectus may be obtained from either of the- underwriters /
y
r. J*
accrued interest
fc v.•* ■«'.
*
such of the several Underwriters,
such State.
including the undersigned, as may lawfully offer the securities in
;,S
1081
-vj
■■■■> 1 -A '3
Hayden, Stone S; C».
1
November 21, PHdu
r-nrwiiBii-f T.'."rrwi'*^nnnfr^
-nr—T,r,
5.
2620
peak year was 1929,; ;ag might be
.expected;- ,:y-;7
'7y;.1 ....
Turning
now
to
individual
companies, some Very interesting
comparative records are found.
They can roughly be divided into
three
classes,
viz:
companies
whose records are behind that of
Bank cmd lnmrcmce Stocks
5
By
E.
VAN
A.
DEUSEN i
This Week—-Insurance Stocks
!
"
■
Two
weeks ago
the
group,
approximate
the relatively inferior
of Security Insurance
also of Franklin Fire
this column pointed to
market performance since 1942 of the stock
compared with that of Fidelity Phenix, and
compared with Insurance Company of North
.that
Anyone who has studied Cannon's
This ideas on homeostasis will recogjmeans that by that time there will 'nize this.11. V".:
-1;^
ibe not less than 60 million 45
Illogical Attitude Toward Older
years and over and over 21 mil¬
lion
65- and over.
Think, of it
million persons 65 and over!
These figures have special signif¬
icance in the light of the all-time
and those whose record excels the
group
employed.
less than
In
^
operating
profits of" the 21 companies, on a
"parent" basis, aggregated $23,770,000; in 1926 they aggregated,
$28,711,000 and in 1927, $46,055,of these three years
v
—Class I (Laggards)(Average) ;
Prov.
Gt.
Spring¬
Am.
field
Home Boston
Wash.
Group-
.
Year
1925-7
100
100
100
100
138
134
154
134
191
171
172
213
151
.163
151
190
209
264
104
196
•100
170
V
100
219
123
119
57
99
148
90
136
134
83
216
78
113
115
52
1933—
147
164
216
89
1934—
159
222
189
114
1935—
183
206
206
118
profits and 1927 one of exception¬
ally good underwriting profits.
1936—
150
217
114 $
1938—
142
?It seems fair, therefore, to con¬
1939—
150
;
43
one
1931—
'
"normal" year, 1925 being
a
was
of
one
of
one
underwriting losses, 1926
moderate
underwriting
average of these three
viz: $32,845,000, as rep¬
resenting a "normal" year for
that period and then to compare
the earnings of subsequent years
with this as a base. It is of inter¬
est to state at this point that in
1945 their aggregate net operating
the
sider
years,
profits amounted to $49,401,000.
*The record is
•
as
•
"
' ?
Index of
follows:
>''
:
"i;.; ^V;. ^Yo^rrTotalNet
_
f Year
'■'*
-:
Operating
,
Profits
'
1925-26-27 Average
'
—§.100.0
(32,845,000)
/■
1—170.9
—195.9
1928
1929
1930
*1931 ^..^.—-—^133.7
V 1932
77.6
—
.——
y
11933 ———.146.9
1934
•
■
182.7
1935
1937 —1—.—....i...166.3
11938
,1939
.
•'
.141.7
-
l
1943
....—.^.....166.4
1944
136.5
.150.4
The
:.\"Y
-v;'.
116
■.
191
190
163
248
214
204
193
234
272
93
109
.106
40
98
100
?
133
164
94
103
106
137
95
54
90
98
52
Y??
150
114
127
88
98
49
"<■-
the
above
on
54
-
in order. Aetna's
relative growth trend was better
than that of the group
up
to
are now
k
52Y?
62
v?
169
187
:
207
I Andnow let
turn
:
Y
196
251
319
225
277
291
Arthritis
91
272
?$ 164
189
follows
•
In
man
a sense we are now
the
branch
infectious
of
For
have followed the
diseases.
It
has dwindled in size, but we have
not
that
of
in
other
the
the
the
direction
diseases.
any
Department)
of
life and
afcjjout
know
we
pie
3,700,000
" >77;
We can't
plow them under as we used to
plow- under corn, potatoes, to¬
bacco, and little pigs. And I am
equally certain that we can't just
turn them out to pasture and ex¬
pect them to enjoy life. People
are not happy when they are idle
and this is particularly true of
'4 Y;-,£H":'.7-'V"V/fl
Increase in Older Age Groups
Some indication of the increas¬
ing
to
of the
importance
problems
which I have alluded may; be
gained from figures on the per¬
centage of our population in the
older
older individuals.
has
a
which
$50 every
most other
j
Our research has not scratched
the surface of such problems
of,
20,8 I?
.2615y "
wJ
1960
When
we
consider
Sold >—Quoted
those
65
tain
65 years of age, 12 or 15.3%
61 to 65 years of age, in other
over
are
words, over 56%
are over 60, In
the House of Representatives, 57
or 21.3% are over 65
years of age,
36
and
representatives
or
13.4%
61 to 65 years of age. A study
was made of top business execu¬
tives as listed in Poor's Directory.
are
Taking
500
contained
that
143
were
consecutive
therein
28.6%
or
over
it?
was
names
found
of those listed
65 years
of age, 78
between
were
or
and
61
65
inclusively. Here again, over
44%;are over 60 years of age.: I
am
certain that a study of the
leadership of the various profes¬
sions would reveal the same large
proportion of individuals in the
older group.
file
of
have
,
workers
is
cocerned
we
no
REVIEWED
a. m.
to 5 p.
m.
(P. C. T.)
Inquiries invited. Orders solicited.
210 West 7th St., Los
—-
14.4
The
Y"--
tion
Angeles
will
seventh
San Frsscijeo
L. A. 289
—
"
Seattle
time
be
over
the
over
45,
65.
At
that the
and, onethe, s^me
total, number
of
.
possibility '■ of - voluntary retire¬
ment on a pension should always
remain open for these. But, if the
premise is that all individuals over
65
our
people is aisd' increasing.- ■ It has
been
conservatively estimated
70 are not worth their keep
or
then least of all should we permit
individuals above those ages to oc¬
cupy the top and critical positions
in our social structure. If we ac-'
is ; certainly; true
and some aren't
fit and pulling their weight at
those ages then we should use our
intelligence to devise methods of
determining which are and which,
aren't fit for all workers, not just
the upper
crust. As the great
physiologist, A. J. Carlson stated
"The
physiologic
age rot
the
worker is not synonymous with
his chronologic age, owing to the
individual variables in heredity,
knowledge
that
some
its kind. Have
baniTof
you
as
new south wales
~
(ESTABLISHED 1817)
Paid-Up Capital
that
£23,710,0001
about it
sometimes makes me think
Aggregate Assets
Sept., 1945
that it would be kinder to shobt
the old fellow. I believe I under¬
Any
biological
organism
.
without
untoward
consequences.
>£223,163,622.
jo
-
Head Office; George Street, SYDNEY
;
-::YY.l/Y
i.
that
denly be! shaken: from its orbit
■
30th
THOMAS BAKER HEFFER,
:
;
General Manager
stand
has beep accustomed to .a set rou¬
tine for 40 or 50 years can't; sud¬
6,150,000 '
^
Reserve .Liability ' of Prop— 8,780,000•
sadness
why so
often they die
shortly after retirement.
-:jj
,j
.
———£8,780,000'
Reserve Fund
an employee "retired"?to the
boneyard by some blind compul¬
sory retirement scheme. There is
unutterable
as
are,
Australia and New Zealand
wants to continue? Have ypju seen
an
important facts- to be .de¬
are
den, inevitably, of siipporting'hiri*
as well as himself. Some individ¬
uals welcome retirement and the
such
weight of our population is shift¬
ing toward the older group and
by 1980 two-fifths of our popula¬
PRIVATE WIRES
TELETYPE L. A. 279
4
I
years
worker his successor has the bur¬
I have, a faithful em¬
ployee who has been working at
this job for .20, 30, or 40 years and
>
10.0 ;
rived from these data
BUTLER-HUFF & CO.
OF CALIFORNIA
1960
1980
v
Special Bulletin and Booklet Service to Dealers & Brokers
4.7i
6.8 f
—
in this life of ours is use¬
for which we are paid
in money or
4.i:r- :• j
1940-;_„^.^U-..
COMPARED
—
3.4
1900->^_.—
«
us
seen,
1880
1920-^
Age plays for real stakes
It wants something
us.
of experience have
well and
are willing and able to continue
to do so faithfully. Training and
experience can only be replaced
by training and experience and
when we retire a competent older
through
learned to do their jobs
ful work
the following per¬
centage distribution is reflected:
:
Simi¬
to do and it must be real. And the
imost real thing we have to sus¬
I860—2.7%
r—.
future ^qhieyeipqpts.
nied
years and over,
Insurance & Bank Stocks
we
hot pastime.
'
40,3
—-
as
larly the diversion of participa¬
tion in sport and exercise are de¬
33.3
..
1980
.
as
i
17.84
:
answer.
But
older the realities of life
are
more
clearty seen and less
easily denied and as we approach
50 and 60 we can no longer de¬
rive solace from the pipe dreams
13|.1%
1900—;
loaf
can
grow
medi¬ ture, the following represents the
the State, proportion of our population 45
thought out years of age and over:
16.0
achievements.
ture
estimates with respect to the fu¬
Only
Youth
content with opiate dreams of fu¬
groups.
According to
U. S. Census figures, and reliable
age
'i860.*.*.....
■
What to do about the aged and
denominator of most of the
/
individ¬
the partially disabled?
disabilities of the aging process.
?'
of older
our
,
nor
carefully
plan
aboiit
more
pathogensis of arteriosclerosis
probably the least com¬
mon
the
heart disease and coronary throm-
'$
population increases,
tHis problem too will become ac¬
centuated.
"ni;
Neither
industry,
Townsend
know
uals in
can¬
which is
that
stream
geriatrics. A whole new field of
knowledge I is
waiting
to
be
nor
We
cer.
yet really started the explora¬
tion
Y
Chicago
rheumatism 9,700,000
disease
As the number
bosis, nephritis, arthritis, and
;
BArclay 7-3500
—
responsibility in government,
business, and the profession.
For instance,
in the present
Congress 32 Senators or 41.3% are
-And yet as far as the rank and
longevity
standing planet Mars than
divides.
stream
we
doctors feel is not the
Teletype—NY 1-1248-49
New York
est
follows:
v'■ '•
with the long white
beard and the scythe.
the old
Friday
N. Y.
.Trading daily 7
worker.
is
'
Economic Effects dl
Dr.
Stock Exchange
~
&
was as
mately; Home's trend follows that
of .the group closest of all the
r
1935,
but
has
since
lagged; companies;
Franklin's was generally
better i Outstanding growth trends are
exhibited by Hartford Fire, In¬
up to 1939 but has since dropped
behind;
Great
American's has surance Company of North Amer¬
been behind except in 1930; Prov- ica and Security of New Haven.
idence-Washington's trend has However, it will be noted that
also been consistently behind ex¬ Hartford's trend until 1932 was
cept for 1931; Springfield Fire & erratic, but has been strongly up¬
Marine's growth trend has not ward since. North American ex¬
only consistently been behind that hibits the most consistent uptrend
the group,
of the group, but in nine years of
while ^ Security's
its earning's index has beerTbelow trend is very irregular, but gen¬
100.
erally keeps well ahead of the
from the same cause. Add to this
Boston's trend has been some¬ group trend.
9,700,000 individuals partially or
totally disabled from accidents
11
'*•
:-V-;-(*'"*:•
'«• r-v;rs'V.*";y-y'•- ..u
and it may be seen that we have
a
problem on our hands that is
greater than most people realize.
has
Laird, Bissell & Meeds
ANAYLZED
older
objection to the imposi¬
tion of blind, and unselective com¬
Hay fever & asthma— 3,450,000
Chronic bronchitis— 1,700,000 pulsory retirement rules which
Nephritis & kidney dis._ 1,550,000 automatically eliminate those in
Nervous & mental dis.__ 1,450,000 the ranks who have reached the
same age regardless of their fit¬
These are only a few of the
ness, ability, and contribution to
chronic diseases.
The list would the
group for which they labor.;
be too long to mention them all. More
precious than oil or fertile
We have not taken into account
soil, than ore and minerals, than
such seriously disabling diseases trees or
an equable climate, are
as
diabetes, thyroid diseases, the human resources of a country.
blindness, tuberculoses, and other All other
things were here when
chronic infections.
It has been Columbus discovered
America/but
estimated that in 1943 there were it
took
intelligent,
industrious
25,000,000 suffering from chronic men to make our country what it
ailments with a disability rate of is
today. We may not fully realize
1 billion man days, and approxi¬
it, but we cannot afford to waste
mately 1 million deaths a year the contributions of those who
Heart
group trend more or less approxi¬
program of what to do about the
vast population of older persons
Bought
in 1937
eases
143
144 /
but
.moment
in the United States suf¬
fering from certain chronic dis¬
303
,
Y165;':k
erratic,
a
chronically ill, Ac¬
cording to the United States Pub¬
persons
112
what
for
us
the
to
the
hand it
ono
years
lic Health Service the number of
191
:
166
:
,
164
189
70
:
>
120
ir 254
180
65
,
Chronically IU
153
241
196
115
108
163
over
129
229
/
133
that is rising in our midst.
A. Qlbbe. Manager Trading
285
176Y
166
cine,
STOCKS
L
,
;; 147
1945—
chronic
INSURANCE
Telephone:
249
164
begun to think seriously
about the sociological and public
health aspects of old age and the
and
Bell
199 : m 221
274
151
even
180 BROADWAY, NEW YORK 6>
149
134i
studied and mastered. We haven't
BANK
Members New York
232
173
83
141.
comments
Y
169
;
1943—
Some
206
197
161
?
1944—
figures
196
shall have
•
92
underwriting chronic diseases of adult
heavy
106
207
.
toward
the
15.6%
88
206
151
135
160
133
114
97
Y
201
58
158
129?.
107
^
:109
198
93
65
70
126
121
60"
107
135
109
1942 was another poor year flows
which
83
88
■
125
i
157
1942—
101
35
we
potential labor surplus of
30 million workers by 1980.
238
129
90
;;
206
162
"Y.
91
120
132
121
136
generations
t|elow the 1925-27 average.
in
I
'
M43V;Y
Y
157
1940—
■1941—
where
1932, did earnings fall
year,
year
1937— 166
,
It will be observed that in only
one
270
'
never
a
(Continued from page 2616)
.157.3 - :V.—109.1
,1945
•.
150
,
—.157.3
;•1940
r 1941
41942
i
;
........149.7
....
Y
:
v-
150.0
1 1936
i
1932
79
scale
The technolo¬
ards and conditions
225
-
II
—158.5
—
ity
100
214
on a
saving
On
.
121.7
—
—
V
labor
gies recently developed, particu¬
larly in electronics and the up¬
swing of interest in science gen¬
erally should provide for that. If
we do nothing about it and main¬
tain present day working stand¬
Secur¬
v
perhaps
new
dreamed of before.
"
1930—122
87
000. Not
100
100
224 ?
171
1929
N. A.
100
100
1928—
Ins.
ford
titude
dividuals to positions of the great¬
introduction of
Class III (Leaders)
Hart¬
Aetna Franlclin
Index
logical and inconsistent in its at¬
Which means that in
34 years we shall have
individuals over 45 years
of age than the total number em¬
ployed at the present time. We
must also anticipate the continued
devices
.Worker' ;r,'l
I,
Society has been quite il¬
■
Our
apparent
that we
have
no
objection ;to
electing and appointing older in¬
more
:
net
total
1925
record
Y''\
which has
announced
by
the
58 million gainfully
just
been
President as
.
,
7
21
those whose records
that of the group, employment
record. Strangely, the first
America. It was then class is the largest, and comprises
thirteen companies;
three com¬
pointed out the reason*for such differences in market performance
panies comprise the second class,
was obviously to be found in the respective earnings records of the
viz: Boston, Home and Phoenix;
companies during the past; four $
—
and four companies comprise the
years*
'
(losses were experienced, particuthird class, viz: Fidelity-Phenix,
It may be of interest to go back lariy in marine risks; notwithHartford Fire, Insurance Co. of
several years further and trace standing, the earnings index was
well
above
100. The following North America and Security of
the trend of total net operating
New' Haven.
:*v'ilv■' -:
earnings of a group of 21 repre¬ year, 1943, was a good year with
The following tabulation gives
the index at 166.4, a figure which
sentative
stock
fire
companies,
has
been
exceeded
only
three examples from each of the three
and to study this record, first of
times during the 21 years. > The classes:
the group and second of selected
individual companies.
will have not less than
we
,150 million people by -1980.
29
■'
Threadneedle Street,
47
f
LONDON: OFFICES:
v V
;
E. C. 2.
Berkeley- Square. W. 1"
■
:v'1
:
*
j-4
Agency arrangements with Banks -.\t
,
—'tbrooghont the U.
•'
S. A.- y' ./'!
.Volume 164
Number 4544
THE COMMERCIAL & FINANCIAL CHRONICLE
of
living;
J: sequelae
of
accidents
disease."
"All age changes
and
Likewise,
come
gradu-
on
aUy" according to Carlson, and
.know
that
now
in
we
individ¬
some
uals
j
changes
characteristic
of
senescence begin even in child¬
hood. And biologically we all start
to grow
old the moment
stop
we
growing. That such changes may
proceed very gradually and
slowly
is illustrated by the
fascinating
and
possibly authentic story of
Christen Jacobsen
Dragenberg
re¬
ported in the Journal of the In¬
stitute ; of Actuaries.' His manner
of
life
may be .instructive for
who
seek
longevity.
those
Dragenberg
was
Dane
a
who
lived to be 146 years of age from
1626 to 1772. He went to sea when
he was 13, took part in the wars
of
three
kings against Sweden,
served many nations in merchant
navies, when nearly 70 was taken
prisoner by Algerian pirates, was
sold
as
slave,
a
escaped
slavery
after fifteen years, and at 84 again
went to
111
war; against Sweden. At
he
married
a
woman of
60,
her, proposed at 130 to
several women but was rejected.
Mastering his disappointment, he
voutlived
lived
for
on
scribed .as
sixteen
beiqg
De¬
impetuous
years.
of
temperament, he lived
from
blameless, but
five years, from 141
hibited
a
table."
life far
a
in
his
last
to
146,
.We choose and select when
hire, and I
can't do the
retire
reason
same
workers.
our
the basis of
we
why
thing when
see no
In
we
we
1930
on
compulsory retire¬
a
ment
rule, the most distinguished
neurological surgeon the world
^
*
has yet known, Harvey
was
retired
from
the
faculty, at
Cushing,
was
at
the
peak
of
his
ability.
He
promptly accepted a full time
academic, appointment
at
Yale
* where he continued his
| ing
contributions
to
outstand-
medical
,;
science. What
was.
*
was
Harvard's loss
Yale's gain, but for Dr. Cush-
ing the retirement rule meant
only the waste of time and incon¬
venience
of pulling
up
stakes,
-
■1
moving, and finding
a
new
home.
When Dr. Milton J. Rosenau
;y retired from the
{
'
was
faculty he
same
too moved to another University
where the rules were not so blind.
From a sociological standpoint the
whole thing is ridiculous, and a
reflection
the state of
on
in-
our
telligence in solving what ought
to be a simple problem. Whenever
society adopts a rule that elim¬
inates the fit with the unfit, de¬
stroys the good with the
bad, or
the innocent with ,the
wicked, it is not a good rule.
Society progresses by changing
rules of this kind. In an imperfect
society human beings are pushed
punishes
"
:
■
*
around
as
faceless
a
mob.
But
social progress may be measured
in the last analysis by the degree
of
skill
which
discrimination
and
Younger
;
The
older
of its members.
Men
Not
.argument
vanced that
% the
with
society solves the individ-
% ual problems
we
workers
younger
been
has
make
men
ad¬
so
room
that
for
their
"
progress
r-
{
tion will
On
the
upward in an organizanot be unduly stymied.
of it this line of
face
,
*
reasoning
;
appears
to
have
some
merit. But it is only-another way
statingthat there are more
of
t workers than there
ing
i
the
are
jobs. Dur-
when there was a
shortage, no one was
war
manpower
afraid that the old, the lame, the
:.f blind, and the halt, were taking
{
■
J jobs
away
younger
workers. - At
similar arguments
able
j more
j times
v
from
and
other
have
been applied against the employ-
ment of women in business, gov ernment and the professions. Cerj tainly there is no arbitrary age
l
at which older workers begin to
repress
the
advancement
of
j
■f
individuals. In a sense,
older individual higher on
i
younger
;
the
every
i
_
ladder
of
advancement,
whether he be 65 or 55 or 45 is
holding a job that a younger in¬
and
only
tinue
aspires to and feels he
fill. That is always true and
it will be
just
45
as
if
force
ment
or
as
even
such
will have to do by 1980
we
don't
we
find;
logical
way of reducing the disparity be¬
tween jobs and workers. We must
not lose
sight of the fact that
must
someone
retire
we
workers
to
more
support those that
idleness.
The
more
retire
and particu¬
should lower the re¬
we
larly if
a
we
tirement ages, the greater will be
the economic burden we will place
those
on
who
work.
They will
have to produce enough to sup¬
port themselves and their families
well
as
of
the increased numbers
as
those
who
must
we
true if
everyone to retire at 50
become
emeritus
realistic retire¬
more
benefits
be
plans must be
problem of transferring
tirement
when
benefits
■
is
job to another remains to be
one
solved.
Under
present
employer
those
not
contributes.;
be
opinion,
old 'age
serve
workers
the
to
available.
of
jobs
To attempt to strike
balance
workers
number
by
over
one reason or
to
earn
on
this end:
1.
and
lower
a
who, for
another, have failed
their share
of
2.
Through workers compensation
and health accident and disability
unfair penalty on
age land ex¬
perience. In a refined and delicate
insurance
we
'
•„
"
where
pack
tially
or
younger
again
we
the
survive
leaders
only
of
until
of
the
the
the
beasts
There
totally
disabled.
have only made
is
ization
we
end
less
are
violent
but
the
able. We
ing
their
beds
filled
with
"chronics," but we will need an
ever increasing number of insti¬
hours for all workers rather than
tutions
by
cases.
reducing
older to
state
a
and
more
of
,
more
devoted
While
parasitism. I
social
solely
venture to say that you and I will
direction
live to
thirty hour; week in
industry.-;
Another
view
that
is
widely
fare
I
and
indicated
have
happiness
that
is
to
Here
progress.
such
again
there
widevariations
in
one
can
eralizations
human
ual
see
lpgically draw
that will
cases.
gen¬
individ¬
fit
Certainly
man
are
reaction patterns that I don't
how
and
of
Even
this
Wallace
have
servative
become
permitting
less
or
more
This is under
con¬
as
be
paid
in
proportion
This
com¬
paper
should
taper off
health
offered.
If
this
disappear:.
soon
tirement if he
can
5.
!
capable
we
The
re¬
greater and more intelligent
overcome
postpone
the
old
suffering
age.
but
Death
it
these
and
has
can
final
in
come
as
it
late
to my
came
-}*Jd V C^\'
I V V/': \
'. '*
President,.
Rosenau.
Dr.
as
v
V\
"
V1/-*''* w Ar1'";
VA
I*; w-r.l<;
0;
>
»r
;
vV/
-
HIRAM WALKER-GOODERH AM & WORTS LIMITED
others that
any
may
■;'
-; ■■■'■
•
Jobs For
The
■
■
■
HIRAM WALKER &
Disabled
SONS, INC
has given us a slight
stimulus toward finding jobs for
war
disabled
We
workers.
Twenty Year 2%% Debentures
have not yet developed this as far
as
the German ulcer battalions
are
concerned, arid
of educational work remains to be
done
with
ment.
:
industry
When
a
and
tends
to
"
v*
^1'
*-v:
v
*V'
?*'-,
1966
,>
*
govern¬
is physi¬
worker
cally handicapped in
he
\k\ 1
*
Due November 1,
great 'deal
a
respect
one
compensate
for
this
handicap by development in other
directions. »This
biological mech¬
anism of
compensation serves to
make such workers perhaps even
more
valuable" t h a n
normal
-
workers in the tasks which
are
vast
Price
it
'and
those who
they
to
seems
are
that
me
interested
in
in-!'
dustHal health and welfare should
lead'in this endeavor.
V
100% and accrued interest
fitted to perform. We have a
educational job to perform
here
Copies of the-prospectus
may
be obtained frorn the undersigned.
During the past decade industry
and
our
ernment
Federal
and
State
havemade
Gov¬
great
ad¬
vances
in provisions for the
care
of
aged.
the
complished
What
is
only
.
we
a
have
start
SMITH, BARNEY & CO.
ac¬
and
•
much
am
more
hopeful that the major burden
of this can be carried
by the ex¬
tension of voluntary retiremerit
plans in which the employer ^and
"rt'
V-7.'
;\--s"
remains to be done. I
..
*
■'
4,
>'' •">**' -\li
<'
November 19,
1946
-
.
/
>
old
even
Milton
'
'
function to correct this develop¬
ment, as well
arise.
of
victory
peace,
circumstances to be construed as an
offering, of these Securities for sale,
offer to buy, or as a solicitation of an offer to buy, any of such
securities. The
offer is made only by means of the Prospectus.:
A
defeat
teacher and
$30,COO,000
or¬
retirement board op¬
a' selective basis cafr
only
not
we
sorrow
its
NEW ISSUE
a
en¬
"
we
but
age
no
conservative with age or even too
reckless as they sometimes do, to
ganization,
erating on
may
,
Industry,
governmental
and
private institutions must make
a
(
we
this
in
disabilities arising from it are. As
doesn't like the
idea.
that
Old age is not a disease but the
be¬
choose
welfare
leadership
deavor.
general practice, the
foolish pride
which
worker
and
expect
other
In
society. It
public
our
is from those interested in
as
positions become too
meet the best interests of the
to
To
conservative.
uals in key
institu¬
his production.
or as an
individual grows more
If iridivid-;
an
will
-
they have grown
older, As far as the great mass of
jobs nqw subject to. compulsory
retirement' are
concerned, ; it
makes no diff erence at, all
whether
and
stands in the way of this
older
be
can
{
a
*would
negligible.
tax {burden
lessened1 by
Bernard
Baruch, 76 years of age, is no ob¬
stacle in the path of progress, and
neither Senator Pepper nor Henry
•
is
each
weav¬
Under
answer.
person will have
a
tailored to fit his ability
aptitude and for which he
job
"
ingenuity- should be capable
it
be
of
now
armaments, which hu¬
eliminating,
basket
as
the
tionalized
recommenda-
remuneration.
aura
war
un¬
not
conditions
of unfortunates in
worker
industry, just
comes
Compared with the tax burden of
over-conseiyative^ and
ideal
there
retirement board
a
should
of
come
ing is
opportunities for down
grading in position and salary
greater • fundamental importance.
make progress we must eliminate
these
obstacles in
the path
of
less work such
Words
will
held is that older individuals be¬
and
of occupational ther-„
must not be forgotten. Use¬
pose:
and
cost money, there is no contribu¬
tion we can make to human wel¬
see a
the
on
convenience
spiritual comfort. The im¬
apy
the young
apprentice
gradually
works
himself up in skill, performance
the
in
and
can't do
we
and
portance
other.
based
in
to these
advances
on
one
every
older
eral hospitals wish to avoid hav¬
One of the most important steps
in solving this problem is the suc¬
cessive
reduction
in
working
do
<
aged
has only one pur¬
emphasize the growing
members as well as adminis¬ importance of the problem of the
trative officials." <
aged and chronically ill. It is a
4. In accord with Carlson's idea,, plea for the; devotion of more
if wage in proportion to per¬ thought, more research, and more
formance is recognized; as; a funds to improve the lot of the
fundamental
principle,
the largest and most neglected group
understand why gen¬
can
based
can
why
reason
tion of
and institutional care made avail¬
same.
Reduction of Working Hours
where
posed of medical and psychiatric
only in the provisions made
approximately fortunates, but also in the medical
result' is
and
them.
the
for
scientific development is avail¬
able for their physical, mental
is
we
and fit must learn
a
greater measure
patience,
tolerance
and
asylums to modern institutions
>
selective and
fitness to do a given
on
strong
exercise
Institutions
Compulsory retirement should
be
for the economic care, of these un¬
the
hiring
no
the
3.
start.
improvement
for
-
institution
an
kindness. toward
'■
selective
is
a
not
room
Since
fitness. If
Here
grow
fierce
enough to
eliminate them. In modern civil¬
~
than
disabled must be changed from
guide toward
'
work
better
of
7.
physiological age is not.
synonymous with chronological
age, compulsory retirement on
a calendar
age basis should be
be
have also taken im¬
jungle law of the fang and claw
perpetuation
a
my
job, retirement should likewise
portant steps in caring for those
who are chronically ill and par¬
it is
way
is
Since
based
ment burden.
an
is
a
abandoned.
the retire¬
all
eliminating
certain age
a
a
assistance
as
will,in
' ■
disabled
t
and
if',' for the aged and disabled and
chronically ill. The following
principles
scale provided for those
The whole problem is
adjustment of the number of
man¬
to
general
For
increased,
workers.
greater
a
happiness for all
,
a
the
and
covered
must
than
more
of
employ partially dis-
to do they are less
burden, financially, socially, and - spiritually to-the
folks
at
home.
Other
things
being equal home environment
of
_
to be done for those that are aged
by adequate
voluntary: retirement
programs,
the present token social security
benefits
have
kind, there is much that remains
his retirement accumulation which
the
nothing
measure
day prac¬
tices a worker who changes from
one
job to another to advance
himself, or for any other reason is
penalized by loss of the portion of
to
,,
6.
As we progress to a more per¬
fect civilization, the goal of which
loss
from
moves
effort
abled persons.
When the aged
;
.
Guiding Principles
re¬
without
employee
an
industry
in
and govern¬
ment for those partially disabled.
provided
more widelyadopted by employers generally.
The
willing older workers to con¬
working, and finding more
but, places
the
partially
Impeded
must clear out the
to
the employee share the cost. Not
can
Harvard
time when he
a
dividual
ex¬
conducted "quite respec¬
;:r
2621
\
-t
mode
KIDDER, PEABODY
CO.
our
;
*
J.
,
THE COMMERCIAL &
.2622
areas
Thursday, November 21, 1946
the [ft mountainous
in
operation
ft'
FINANCIAL CHRONICLE.
of the company's territory.
Along with debt retirement and
plant improvement the company
had ample surplus earnings dur¬
ing the war boom to build up an
exceptionally imposing financial
strength. ;Net working capital as
of the end of August was in ex¬
•
Atchison, Topeka & Santa Fe common is among the better grade
rail equities that many analysts have been recommending lately. It
cess
of $128 million.
has not recovered very sharply from the year's low and is still more
It is this
than 30 points below the 1946 high.
The present dividend rate of financial strength that leads to the
$6.00 a share, which has now been maintained for five years, affords expectation in many quarters of
a
dividend increase. All of the
a particularly generous income return, ft Rail analysts consider this
dividend rate well protected for«»
company's callable debt has alf
quite some time to come and, as to see how the company can avoid ready been redeemed and even the
preferred
stock
is
a matter of fact, there are many
earning considerably more, perhaps outstanding
who consider it quite likely that close to $15 a share. For the nine non-callable so that it seems un¬
through September the likely that any further funds will
a more liberal
disbursement may months
amounted
to
around be used on the capital structure.
be in the cards over the reason¬ earnings
able future. Certainly such a move $10.35 and seasonally the closing The treasury position is certainly
would appear fully warranted on quarter is generally pretty good ample for any emergencies that
the basis of the financial status for this property. On the average might -arise. Therefore, it seems
and
earnings prospects for the for the past ten years the last only logical that from here on
could * expect, ihO
three months have contributed stockholders
road. • 'ft-. ': -ft - ' '''' Aftft;:ft.ftft
just under a third of the year's net lion's share of any current profits.
The
management
itself esti¬
operating income.
For next year
For the ten years 1936-1945 agr
mated in connection with the rate the
management estimated that if gregate earnings on the common
case that earnings this year would
the rate increases were granted amounted to $185 while dividends
-
to $11.52 a
amount
without benefit of
stock
common
share on the
On the
tax carryback credit.
any
basis of results
so
far it is difficult
or
were
general
severe
a
out oil
depression.
And how
Physically and financially Santa
a-different proposition
On6
thing to remember about the road
is that in its 50 years of existence
than that right now.
sustained
a
deficit.
Although its capital
structure has always been considf
ft-A"
Of J. B. Roll & Go.
ered, sound the management has
-:.Aft A.-.A
Preferred
•
prevailing
maximum effect.
elected
ported by sound economic and so
quired both Teadership and co¬
operation. Leadership in the na¬
tion as well as of all economic
cial reasoning.
we
must look
forward—not backward.
We must
Republic Pictures
Debenture
4s, 1965
ft
1
Co.,
Wall
New
York
City,
d
'
MEMBERS
York Stock
Exchange and other
leading Security and Commodity Exchs.
New
120
Broadway, New York 5,N.Y.
231 So.
LaSalle
St., Chicago 4, 111.
our, own self-interest, as a group,
but in the broader interests of the
differences
community
which
500
tal
little
was
than
more
put into the property in capi¬
improvements in ftthe preced¬
penditures
Canada Southern 3%
Stock
Howell Electric Motors Co*
Harris-Seybold Co.
;;
Selected
Situations
at
All
willingness .to adjust ft
on * a highM level ft of
understanding and patriotism ih
requires
superimposed on
liberal maintenance outlays. From
were
the interest of the economy as a ft
Whom whole. Such are the components
must in¬ that must exist if we are to make
For it is
at large.
those whom we serve upon
opportunities, or
to preserve in
the Amer¬
ican way of living in the form of
the competitive system of enter¬
prise. Such are the circumstances
as
I see them today as affecting
the field of opportunity as we
move forward
into the postwar
era.
It Is clear that the facts do
not
support
such observations.
We have not * brought to bear on
our problems, leadership at such
a
level.
Quite
the
contrary.
We have not succeeded in obtain¬
ing the cooperation so essential.
On the contrary, the interests Of
individual pressure groups hup-ft
ported by the -political considerstiori have become the controlling
the most of our
further—if
not
an
to
news
you.
important part
I speak of it because it is
of
the
pattern
illustration
evolu¬
industrial
whole
our
Science, through research,
discloses the possibilities.
Indi¬
vidual
the
develops
effort
com¬
ponent parts.
Coordination fits
the parts together in a complete
progressive whole.
and
We some¬
forget there is woven into
times
He has
bonds.
since 1939. Mr.
Th
o m
formerly was
with Goldman,
£ Sachs
&
Co.
'
the
and
Cen¬
Hanover
tral
-Bank & Trust
Company.
Andrew F. Thompson
Prior
The greatest war
A Year of Confusion
p s o n
be successfully challenged but,
what this country was the domi¬
that nating force that led to final vieexpresses it too mildly.
Perhaps, tory. It was made possible by
our
know-how in designing and
we should say, we live in a world
of great confusion—political, eco¬ producing more and better instru¬
The year 1946 will go down on
the record as one of great eco¬
nomic
confusion.
Perhaps
nomic
and
In
social.
industrial: mentalities of
that
to
duction
the
purchase of diesel
was
for
power
to
fices
in Bernhards Bay.
Mr. Le¬
continue to
the
pas't he
was a
to exercise our
ents, capitalize our willingness to
work and to utilize our national
resources in such manner as we
creasing importance—whether we
like it or not—as the economic
Pai^-
ley-LeVeillie Co. of Syracuse.
Times
Both
effect
vitally
side influences; • And by
largely determine the nation's
ability to produce with its impact
on job opportunities and the trend
of
living standards.
Both con¬
stantly in the process of evolu¬
importantly
of future wars.
ican system
changing pattern of the
economy.
It is no exaggeration to
Railroad Bonds and Stocks
Telephone BOwling Green 9-6400
ft
Teletype NY 1-1063
polieyr and; its
will-
administration by enterprise,
,
.
influences
at
economic
ft
"... I
ft
j.'-
»ft
""
Lehigh Valley
4
^
,
x-t
;
•
ftftft'vftft'"'
;ft
t'
'
'J ft-, ft'.' ftV
ftftft'ft
},
ft1,..
.
.^
,
rM\
;
?
t
"/i
^
.j* 11
}
vftftft; 61 Broadway
|§Sftft-ft
*
M
'
ft
ft''ft ft
ft
.
,
-
)i • -ft
/
"'"'.ft
vft ft-'
•
New York 6
; ft-,
war
of
peace;
/
forces that exist,
Bell Teletype—NY 1-310
•
■
'
'
.
v
.
Income 6s-60
.
•
ft'-
,
'
ft
<'
•
1
we
know
fully. appre¬
people
the
loss
are
I do" not
of
their
eco-ft
the
political and personal
freedoms as well".'
They are in¬
separable.
When one falls," all
fall. The only, uncertainty is the
factor of time, ft And
one
false
inconsequential as to itself,
step,
the next step
makes
more
logical.
ft '
'
/
as
Change: it.
our
that
positionj much
UNITED
Adams & Peck
.
.
.
-
PUBLIC
v
.
UTILITIES
.Common --ft ft
*Prospectus
on
ft
appear th^t
X do not un-«
...
,
ft. ft
ft
ft
Dealers,
Inc.
;
■»
Lady of Victory Church
rft
•
•
*•'
.
*•'
-.A'-ftil ft•.
A War Mernorjal
in
i
•>', *
'
-ft.
> ' ft
ft
ft;v'.ft->•
ft'ft'/ft,?' "ftftftft ftftft'V ft V: ftVr
ilio Financial District:
ft
ft-'." ■■ .ft- \' '"ft;--; ! :ftft.ft'ftftftft ■''ft-:' "ft vft:ftft ftftftftftft/ftftft :ft v
Your Contribution \is Earnestly Solicited?
ftft
ft ftftv ft ft
for the Building Fund
.
>ft
-
;
request
!
1. h. rothchild & co.
of Securities
ft ft
'v.
:
Member of National Association
Hartford
v-«
ift.ft ftftft
.■ftft:. ft'ftft
Wall Street, New York 5
Tele. NY 1-724
'•
ft'ftftft
THOMAS A. EDISON, INC.*
Philadelphia
V *
Our
-.
ISLAND AIRtlNES
LONG
Boston
:
DENVER, SALT LAKE
Registered
BOwling Green 9-8120
'
,
and the uncer-
the long-term *
tainties in
opje
volatile
theft highly
believe
such
to
AA
.
63
and pass on to
.economy
Trading Markets-in—-
4%s, 1950 '
or"-
today, as we liquidate. the
exist
ftftftiftftftv
£ffec«f
loss of their
greatly 'ihvolVed t 'pMbiem^ - that
of New York
•
■
j*/
1
Members New York Stock Exchange
ftTelephone—DIgby 4-4933
•
f
PFLUGFELDER, BAMPTON & RUST
'ftJftft *V;-.:lftftv. 'ft*.•%ft!
so
both in war
that there should be
nomic freedom carries with it
The
pattern itself.
work
ciate
determine the character of the. fu¬
ture economic
of competitive enter¬
and in peace,
tional
I
' J ;)
.
tively demonstrated
.
say-that the determination of na¬
New York 4, N. Y.
ft;/.
It is incomprehensible as we re-*
view the evolution of the Amer¬
thp prise^ with its end result
influence
always
25 Broad Street
desire—unhampered by out¬
the threat
may
and
tion
freedoms—the opportunity
initiative, our tal-f
all our
connect¬ systembecomes more: and mdre
partner in
obj ectives
of peace, as applied to our domes¬
tic affairs, as the preservation of
in¬
assume,
ability to win the peace, £ I
our
would define the prime
of
will
and
well as our
war as
ability to organize the forces of
combat.
I never lacked faith fn
our ability to win the war.
But* I
have always had reservations as
goods and services.
BERNHARDS
BAY, N. Y.— Political statesmanship in the eco¬
George N. LeVeillie is engaging* nomic area likewise is assuming,
in the securities business from of¬
in history has
The statement can not
been won.
v
operating and future earnings
intensified.
standpoint probably the most im¬ ed with: Herrick, Waddell & Co. In
portant part of the program
we are
the world of tomorrow,
•
;
this is
in
er s
Veillie has recently been
an
a
factor. I submitftthat such are th^
every technical development the
hopes, ' ambitions, the successes reasons, in part/ why we are in a
of
such
great confusion;
and the failures—the very lives,' state
been with the
as a
matter of, fact—of a great And, at a most critical point in
organizat i o n number.
our history.
Thus we progress!
ea
LeVeillie Opens
ing six years. Moreover, these ex¬
D. L. & W.-M. & E. 4-6s 2042
courage
management, statesmanship has
420,000 of equipment obligations time he was with the old Chatham become and must in the future as¬
outstanding as of the end of last Phenix National Bank and Trust sume, a more and more vital part
year. As a matter of fact, the enJ Company,
in the policy phase of enterprise.
tire funded debt at the close of
We, i of industry, can no longer
1945 amounted to only $230,575,limit our efforts to the mere pro¬
was
Analyses On Request:
1
must exercise intelligence,
and faith.
Cooperation
groups
govern ment
on1
Ernsj&Co.
B.
Street,
six; years 1940-1945 gross capital
expenditures topped $221 million
of which some $156 million was
equipment and $65 million on
way and structures.
In contrast
with the heavy equipment pur¬
chases the company had only $27,-
J>
_
8c
Inc.,
j
;
In addition1 to
But
accept,individually and
collec¬
tively, the responsibility of pro¬
tecting that franchise, not only in
of
Roll
.
For, under such
less
in a state of flux.
The dangers
dre'theh the greatest.
And, con¬
versely, the opportunity for con¬
accomplishment
the
the fundamental needs and desires structive
of people everywhere. And sup¬ most far-reaching. / There is re¬
tion.
Vice-Presidents of
the
develop
forces
circumstances, ail is more or
in it.
Andrew F. Thompson has been
aggressive debt
retirement the company has spent
lavishly on the properties. In the
v
>
You have taken
Y.-P
of great adjust¬
rapid evolution that the
It is in periods
ment and
It is Clear, I believe, that our
group of industries have created
an
industrial franchise, valid in
war and in peace, and founded on
an
leaders in tha in¬
dustry in recent years in, debt re<tirement. Since the beginning of
1941 the non-equipment debt has
been reduced by about a third,
leaving only about $203 million
still outstanding represented b^
the two issues of non-callable 4s,
1995;
people
of
daily living.
]
into bold relief.
power.
our
importantly
prices.
A. F. Thompson
been among the
Marion Power Shovel
of
means
a
would be affected in their manner
AH
it has not in any year
Arden Farms
as
During that pe¬
held to $31.
than it Was a few years ago.
Common & Preferred
with4 bf Industry, Will bring these facts
of heat and its
source
a
utilization
Fe-is quite
Chicago
as
we
must depend.
We
tensify and expand our research.
We must promptly and
effec¬
riod the reduction in debt and in¬
tively capitalize our research in
crease in net working capital has
advancing technology in all our
been equivalent to more than $72 functional activities. Hence, more
a share of Santa Fe common. The
Offectivemerchandise in terms of
stock does not sell for much more consumer
needs; at lower real
earnings would amount to
$7.46 a share.
This, also, will
presumably turn out to be quite
conservative barring serious crop
hrfull
failures
(Continued from page 2609)
the world of today would be
52 wall street
HAnover
2-9072
n. y. c.
■
5
Tele. NY 1-1293
ft
'
-
ft
"ft'. !
r
,'ftft'' "ftft.ft/ftft,ft
Mclaughlin, reuss & co.
.
*'
»
Volume 164?. Number 4544 .7
'
THE COMMERCIAL & FINANCIAL' CHRONICLE
,
'2623
derstand why, with -the record so
ord..!. This,
likewise,- has been
clearly Spelt out on the pages of validated by subsequent-events.
history, some fail to see" that it -These "two sets of circumstances,;
I
until
man
was
free
to
to
my way of thinking, offered a
real challenge to American indus¬
that trial leadership and an outstand¬
economic progress in the world ing opportunity for expanding job
really began and our modern civil-; Opportunities with rising living
ization commenced to take form. standards.
And all ;this with a
his talents in his
to
'
his
own
way
advantage,
own
j
Northern Pacific
.
difficult
to
accept the phi¬
reasonable
Serial
,
.
•"
.
;/•''/"'r,'■/
-
:
/ V'
•
tages of capitalism and to super¬
impose upon same the alleged vir¬
tues of a planned economy.
jresult.
'
.
i' These
in
of
economic
power
the
political. area and carries
with it increasing danger of the
subordination of the enormously
constructive influence for ^progress
>
///v;
Auto Industry. Situation
'■
V1
V-
'
•
.
; ,/■*
to
■:
:
*'.
•
.
'4
-
•
.
..
1956, inclusive
/.:
■
■
;
.
.■
y
by the Northern Pacific Railway Company
,
•
•
as of December 10,1946,
provide for the issuance of $6,880,000 principal amount of Certihcates to be;,
secured by -new standard-gauge railroad >equipmefit to -cost not less than #8,632,579.
which will
;MATURITIES AND YIELDS
(Accrued dividends
-
\
to
;
.,
/*','
t[
t
j
I
1.60#
1954
1948
-
f
1950
1.50
1
T951
1.70
1955
■
1952
l.£0
1956
1953
j
1.15#
'
„
1.95
19<9-, 1.45
.
,
/
,
.
be added)
1947
2.05%
'2.10
2A25
Issuance and sate
■
j
r/'
4
>
oftkeseCerttfcates dre subject to authorization by the Interstate Commerce Commission; /
The'Offeritig Circular may be obtained in any-State in which this announcement is
'/'I;
Icitculatedffomodlythe undersigned and such otherdealers asmAy *, : / ,'4;
;.'4•
lawfully effer these securities in such State, ■*
*
r
and: circumstances, there : appears; <
be little mystery in the sharp t
to
decline
in
the
value
of
and their readjustment at
WALLGARTEN A CO.
R. W. PRESSPRICH
goes
The adjustments essential to pass-
OTIS A CO.
HARRIS, HALL A COMPANY
THE ILLINOIS COMPANY
.CORPORATION
CORPORATION
MA$ON| MORAN &.CQ.
McM ASTEf* HUTCH INSON &. CO.
ALFRED O'GARA & CO.
The year 1946 will be one of ing from a controlling war econ- !
great disappointment as well as omy to a free peace economy Nwere ; I
Of i greats confusion' to' hs of ? the, before/us^ Bpon ^sound nationals {[
automotive industry. We had ex¬ policy, courageously and intelli- ;
acted .that with the -process!! pf gently administered In the interest :
the economy/whole,; -t,
reconversion well along toward! pf
^completion in the latter part ol everything Z14epen(ied.'-/,ItHrwas /
.
BACON, WHIPPUE & CO.
THE FIRST CLEVELAND
i
■; ■
4
THE MILWAUKEE COMPANY
JULIEN COLLINS A COMPANY
MULLANEY, ROSS & COMPANY
our
confustion
HORNBLOWER A WEEKS
L. f. ROTHSCHILD A CO.
,
MICHIGAN
PUTNAM A CO.
existing economic i
back to Oct. 30,- r
1945.. At that time industry was
moving out of war production. It /
was in the process -of reconversion. ;
genesis of
A.CO.
incorporated)
FIRST OF
; M
£ 5 greatest! nation - ;on earth; ^ have oi pending events;
-But what are the underlying
here a real responsibility, One that'
we
have not as yet adequately causes?/ It appears to me that the; i
of goods and services.
'*
each December 10, 1947
on
These Certificates are to be issued under an Agreement to be dated
equities j
consid¬
erably lower levels.
It is a re¬
of individual initiative and effort, appraisal downward of the oppor- t
t hold that/ you! and' I and; all> tunity of enterprise and its ability 1 !
to earn profits under the existing f
others who believe iri those things:
circumstances and in the shadow j
that have made this country the
determined. ; I repeat: It is clear,
management can no longer limit
its efforts to the mere production
:'V-
/■
1
•
concentration
'!•
v.f
j
clear.
;
To be unconditionally guaranteed as to payment of principal and dividends by endorsement
i
t
,
facts--stand- out
crystal
They have created an atmosphere of great uncertainty as;
I speak of this experiment be¬
to the immediate forward position
cause,
Whether it succeeds or
of industrial activity and the abilv fails, whether the aims are
at-,
tained or iibt/it Is certain to have i ity of business to earn adequate
And this has happened
k profpund influence on ^economic; profits.
'/^''trends'^thKoughout'^th^pworM^'dti notwithstanding that the national
income is/ being-maintained -at.
large. * And its impact on our
'American position can not be ig¬ high levels and the physical volume of production is in all probanored.
We must accept the fact
that the world moves on/for betr; bility in excess of peacetime recter or worse, toward a far greater brds.; In tthe /light bf ?isuch Exacts!
-
.!/
■-
•
$688,000
mature
■'.•
'
'
•
a
,
(Philadelphia Plan)
'*
To
// /
Equipment Trust Certificates
!
blueprint ?of the world's semi-' as the barometer of our economic !
socialistic, semi-capitalistic state. well-being—will >in the aggregate, 1
In other words, a proposal to em- ! in all probability, earn little or no j
ploy in the same economy, phi-; profits (during the year. And all ;
lpsophies inherently in .conflict this notwithstanding that all ap- j
with one another.
forces were i
An attempt to plicabla economic
maintain the established advan¬ movirig to insure just the opposite }
P
,
Railway
lipment Trust of 1946
expectancy of mairi- |
losophy that the economy can be taining that high level over the j
long-term position when ence at- •!
stabilized, except in limited degree, half free and half slave.
It Itained—an opportunity that could J"
must necessarily move one way or not be Expected to repeat itselfJ
the other for ah economy is al¬ But events have demonstrated that !
ways in a state .of flux.
It is, in: in important sectors of the econ- !
part the attempt to do this very orny, more particularly in the \
thing that has intensified our Semirdurable and durable goods >
existing confusion. Yet we see in: industries, this is just what:has ;
the recent announcement of 'the. hot happened.
The automotive 1
British Government what is really industry—frequently looked upon! 1
It is
KEBBCN, McCORMICK &. CO.
SCHWABACHER A CO.
E. W. & R. C. MIL LER & CO.
SINGER, DEANE & SCRIBNER
,
,
vl945v there was reason to expect
in,1946 ,a; high level of pr.oduc-!
tion; large payroll disbursements;
generous support of our suppliers
and
distributing
organizations;
good profits for our stockholders,
'and an expanding output of goods
from our assembly lines ^ badly
^needed asa result of the shortages
of the war.
had
In the aggregate we
expectation : that
it
Would be possible for us to make
an
important contribution to an
'expanding peace economy,
t
-
every
This expectancy was/ I believe,
based
ing.
on
sound economic reason¬
Modern history records the
fact that after all
,
,
,
wars
clear that the
mined
would
Short-term
course
then deter-
vitally
concentration
such
of
a
great
industrial effort
protracted period di¬
rected toward the single objective
over
a
of destruction.: In no former wars
/has there been
such
.
,
the
affect
/•'
-
i
,T<3l be dated December 10,1946. Principal and eemi-anaiial dividends ( Jupe 10 and December 10) payabie in New/
\,
York-City. Definitive Certificates, With dividend warrants attached, in-the denomination of$l;000, regi8tefableas;to ';■///.:
.^principal. Not redeemable prior to .maturity. These Certificates rare offered when, as and if -received -by us. It is ' ' /
"expected that Certificates in temporary or definitive form will be ready for delivery "at the office of Halsey, Stuart
& Co. Inc., 35 Wall St., New York 5, N, y. on or abontpecember 12, 1946. The information cohtained herein has
y//./been earefuUy^ompiled fromf-sotijjces considered reliable and. while not guaranteed as jto completeness or accuracy,
{
we believe it to be correct as of this date.
*" - '
»
•
..
/
F. S. YANTlS & CO.
,
.
-
«,
and /importantly; in- 4
fluehce the lOng^t^m/posihohPf
.
j
American enterpriss.
On that-day
came a pronouncement of national
policy; And in two parts; -.
■!
,
1.
Wage increases
2. We
j 1
are
imperative.
This announcement is foot andffer to sell or
the/line
on prices.
that wages,
The concept
'
1 :•
$3,000,000
•
*
creased
efficiency, constitutes an
amazing misinterpretation of eco-
V
And that is true irre-
There appears to be
a solicitation of an offer to buy these:securitiesv
offering is made only by the Prospectus,,
/
a ma¬
jor component in prices, could be t
substantially raised / Without/ af-t
fect'ing .prices.unless!offset by in-,
homic law.
The
^
must, above all else, hold
much
con-
The Weatherhead
*
:
Serial Debentures
•
i'
:
/.'"v >' ''
v
v'.-Vv V'*:'
v
///.
,'.V•
••.,/
/
'J''
•>
"i":.'/-
-v.
-'yV'V.7/u;
"vv
;6-'/v*''•"/4/
•
$160,000 due each October 1, 1952 to 1965, inclusive
$760,000 due October 1,1966
i*
fusion in the general thinking on '
this whole/subject.
In an eco- r
homic sense, wages, salaries and
other forms of compensation! <pn-
Company
'
:
there fol-
has there been such
4
*
/
spective
of!! time and cii'cum-/lows a period !!bf ! great business Stances.
And, likewise, whether
v activity.
Only in duration and in- the economy is moving either into
tensity does it vary. In no former a state of inflation or deflation,
wars
THOMAS & COMPANY
.'•
yr''v!,/Q* f;;X •; 'V*' -C
*
-'
V
.great ca¬ stitute, in the/aggregate-, f more •
It was cleat; than three-quarters of what the v •
that i; an enormous potential de-i consumer
pays for goods and serv!j raand for all kinds of peacetime ices. When wages/rise in an im-; ■! r\ goods and services would neces-: portant sector of enterprise—and v
sarily develop.,-/This has been especially as & result of declared; 4 •
: i validated by subsequent events.
?
national
policy — the .V increase!
I 7. There was also reason to expect spreads through evolution and in 11
[ that the wartime savings of 'indi- the coprse of time affects- wages ,r!
] viduals and business; liquidation in other sections, in degree.- Sal- f
| of consumer -indebtedness; -reser- dries and other forms of compen-! I ■
i voir .of * instalment finance—in-6* Sation .necessarily follow, to main- J tain
|sured an ! enormous backlog of Pricesthe- essential, relationships.- begin to - move up; and ;!
; potential purchasing power supersoon reflect themselves in
/•;
•
1 V" •' ■•••;
!-' ' V-
'['■
•'
f>
*<>•;'
:• V/"
••••,••
*|* 'H*>-''■'*'/■ '/?,/•/;'• ■*«':'■: pv
'V-V'
-
'
' 7
v
-
P
RATES, MATURITIES AND YIELDS
a
pacity to produce.
"
1952
2.35%
2%%
1957
2.90%
3%%
1962
3.30%
1953
2.45
m
1958
3.00
3%
1963
3.35
,1954
2.55
3'/i
.1959
3,10
'3%
1964
3.375
1955
2.65
3%
33/«
3.40
2.75
314
1960 '3.20
314.-.,1961.-3.25
1965
.1956
i
1966
3.50
,
,
,
..
.
■
.
.
'
v
an
i imposed upon
that created through
| current production—to capitalize•
the
deferred
possible
;: level
of
to
demand to make
raise
the
it
peactime
economic activity to
a
point higher than any prewar-rec¬
crease
in the cost -of living,
more
-
there,
dollars,
(Continued
are
more
available
on
page
from such dealers
be obtained in any State in
which this .announcement is circulated only
may-lawfully offer these securities in such State* ' ,
.
as
in-
end result is that most things cost,
And
v.
That
Stimulates wage increases in ,other
areas not previously affected. -The
more.
The .'Prospectus way
/■>*
and
to, pay
2624). r
4
>
•
HALSEY, STUART & CO. INC
?
-
November 20,1946.
/
;
,
1
*?—
THE COMMERCIAL & FINANCIAL CHRONICLE
m4
small
minority. In addition, the
savings of previous
years are being reduced in value
by the depreciation of the dollar
(Cpntinued from page 2623)
in terms of these higher prices.
The second point in government
more.
But the increase in the
Further demands, now apparently
dollars available to pay the higher policy—holding the line on prices
in the offing and rapidly taking
prices is hot spread out equally. —has had a destructive impact on
definite form on the part of labor
Some can pay.
Others can not. expanding production due to the
for still further wage increases,
Still others, only in part. There¬ fact that prices of many products
will lead to another wave of pro¬
fore, the ability to purchase on a in our highly complex economy duction in t e r r u
p lion- through
national basis becomes restricted. are closely
inter-related.
The
strikes, hence, further shortages,
Production falls and employment, policy of attempting to control
and another advancement in the
likewise.
There is no real gain prices has intensified further ma¬
prices of goods and services. This
to the community in a spiral of terial
shortages and interfered
will
accentuate the unbalanced
increasing wages and prices. The with the completion of finished condition of
present wage-price
Control of prices, in fact,
only real gain in living standards goods.
relationships and make the. adjust¬
in the system as a whole, is when has taken the form of regulation
ment just that much more diffi¬
efficiency is increased so goods of industry's profits. Again it is cult.
We continue to follow
and services can be sold at lower clear that wages can not be con¬
dangerous course.
~
sidered without prices. And prices
real prices.
»
Apparently two possible solu¬
The wage content in cost varies involve the question Of profits.
tions present themselves—First, a
greatly in one industry as against The peacetime • effort of stabiliza¬
another and between different tion has failed not only because of gradual adjustment of existing
producers in the same industry. its unsoundness, but because of its wage-price relationships, if the
administration. / Its time factor under existing circum¬
Materials, supplies, transportation, ineffective
stances permits, or second, a more
services and other components of major and continuing effect has
cost are largely wages expended been to act as a deterrent to the rapid adjustment"involving a more
Why the Confusion?
.
accumulated
prejudice ' these
important de¬
gree and to an extent difficult to»
appraise. But, irrespective of this
limitation, I still am of the opin¬
When collective bargaining ion that a period of limited active/
breaks down and a strike is business lies ahead after this ad¬
r
threatened substantially preju- justment takes place.
society must find
nomic
settle wage
possibilities to an
a better way to
disputes, when its in¬
terests are substantially preju¬
diced, than economic warfare.
Here is the question:
A' dicing the public interest, what
/ is to be done about it?
;' Here is the
parts;^? v
1. Collective
,
the part of other producers. In
the. automotive industry it can be
stated in general" terms, that an
expansion of production,
/A/;/z
Without entering into the argu¬
ment as to the theoretical justi¬
increase in wage rates
fication of price controls, in
of what has happened the
tional
basis
will,
on
a
through
•
na¬
the
a
factor
;
other economic
And that involves the
time.
of
The
some
confusion
existing
today
fits exactly the economic pattern
It is the logical
jUSt described.
Outcome of an effort to ignore
economic law supported by the
group pressure of individual in¬
terests. It is clear that the two-
the prelude to stabilization
as
sounder economic basis,
on
a
immediately eliminate all wage,
price and Other controls involved
in production and return to a free
competitive economy and the law
not greatly different, increase
in costs and hence selling prices
unless offset "by increased effi¬
ciency or
influences.
con¬
The latter appears
at the moment to be unavoidable
employment.
thing to do—and prob¬
ably the only way out of the mess
we
planned for ourselves—is to
dustry, I am concerned with the
upward trend of costs and selling
prices./ As applied to General
Motors, if we. assume the effi¬
structive
process of evolution, reflect itself
In
view
or less violent, though temporary,
shrinkage of business volume and
of
.
Applying the above set of cir¬
cumstances to the automotive in¬
Let the ciency; of production of the - last
judgment of the market place be prewar year—say 1941—and. ad¬
substituted for the directives of just our selling prices on a com¬
(the bureaucrats.
We are trying parative basis, we find a $1,000
to operate- both in a regimented prewar car must sell for $1,500 as
as well as a free economy, at one
a postwar car.
And, in all proba¬
and the same time.
The incon¬ bility, costs have not yet fully re¬
in
sistency of such a course is making flected the recent increase
supply and demand.
POint program laid down by the
governmentone point in di¬ itself manifest and will continue
re^ conflict with the other— to do so as long as it exists. ;
served as a political justifica¬
Wage and Price Relationship
tion .for wage demands on the
The attainment of a sound eco¬
part of labor. Gome and get it!—-'
SO to speak.
The increases] de¬ nomic relationship between wages
manded as to amount, were un-. and prices is the real problem of
sound and uneconomic, as subse¬ the moment. The fact can not be
quent events have proved. They; ignored that costs and hence sell¬
uould not be supported by a cor¬ ing prices, in many lines of pro¬
responding increase in produc- duction, have advanced to a point
tjyjty. They were, of necessity, in where they are moving out of
rt^e general interest resisted by reach of important sectors of their
mauagenient.
There resulted a potential markets. Prices are fur¬
WVe of major and then minor ther inflated by the inefficiency
of operations under existing con-,
spikes on a broad front still conWhile
the
jl^nuing to a lesser degree. This ditions.
purchasing
a^jously interfered with the pro- power of some may have in¬
hence
wages,
are
subject to fur¬
ther
adjustments.
Another wave
of increases will, over the course
of time, reflect' a still
further
and
corresponding increase
in
selling prices above that indi¬
cated.
How a readjustment is to
be effected with such a large pro¬
portion of costs (wages) frozen, is
difficult to contemplate.
The al¬
,
permitted to follow the full
:
without
course
from
and
interference
outside influence
irrespective of the eco¬
any
nomic
consequences
on
the
contending parties;
the public interests are
substantially involved, they
2, When
A
must
be
protected
'AaA limiting the
scope
by law
of strikes
creased
in
relation to
the
might be possible.
facts we face.
Such
are
the
!
,
Labor Monopoly
The
advancing
strong and effective as to offer an
irresistible force against encroach¬
ments
the competitive system
of enterprise on the part of any
outside influence, be it govern¬
on
ment
otherwise,
or
Collective
bargaining is that bulkhead,.
There
some who /Advocate
arbitration, compul¬
sory or otherwise, or some such
course.
Wages so adjudicated,
sooner or later will necessarily
involve 'the question of profits.
And profits can not be considered
without establishing all the im¬
portant operating policies of the
business and assumptions as to the
future trend of the economy.
The
full responsibility of management,
are
fact finding,
so
essential
prise,
ceases
to
successful
enter¬
to exist in fact.
The
government, directly or indirectly,
becomes the dominating power in
such determination.
The political
,:
ago, business in some in¬
stances,; was becoming monopolis¬
tic, both, jn form and policy. And
something was done about it, To¬
day, labor is becoming a monop¬
oly and something will be done
about it.
Monopolies lead to dic¬
tatorships.
Labor today is exer¬
cising a dictatorial influence ovjer
other groups, and even on govern¬
ment itself, and prejudicing* -the
progress of the economy because
consideration
becomes
the
winter at the time of the General
Motors strike.
Consider it in the
light of the then and subsequent
circumstances. * Then ask them¬
until
better balance is effected.
a
As things stand today, there ap¬
There must be evolved
events.
frank discussion of
an
industry of
paramount
setter
importance in the
Nation's economic and strategic
development.
INCLUDES: A detailed analysis
nies
..
Discussions of prices,
other factors
■
each of 38 leading compa-]
affecting the industry.
Your copy
quest
on
demand, methods of refining and
with
of "Petroleum—1946" will be mailed
no
of Investment Securities
*
Uptown Office: 730
'
NEW YORK 5, N. Y«
fifth avenue
of
the
community
as
a
This
Brokers in Securities and Commodities
70 PINE STREET
that
not only in the
interests of labor itself,
whole. And it must be done with
full justice to all; including labor.
The implications of continuing the
present course are too serious to
contemplate.
it
: >
Merrill Lynch, Pierce, Fenner & Beane
Underwriters and Distributors
sut
a
balance,
long-term
on re*
obligation. Just address Department "F-2"
highly important influence on
the
economic af-'
fairs.
It is certain to result in a
far more favorable climate, and
on many counts, in which businessr
is to operate.
It will go a long
future trend of our
re-establishing the com—-
to
way
business career again becomes an
honorable vocation.
It should be?
of great,
source
a
to all of
toward
recently
ing
encouragement
We have been mov-A
us.
greater,
a
importance of
production in our scheme of things ;;
and an appreciation of the fact/
that production must be encour-.
aged in all legitimate ways—not
discouraged and penalized. With i
this support that trend is acceler-realization
of
the
ated and solidified.
But
must not fool ourselves.
we
verdict of last week should?
The
be accepted as an opportunity—I
not as a victory.
It is a protest"
against—not an endorsement for. A
As a matter of fact, there was lit-'
tie to endorse.
It will be a real
victory only if we make it such*]
The same problems remain to besolved.
Economic statesmanship
in industrial management is even1
little we can do to correct
We must pay the price.
Cir¬
cumstances differ materially today
is
problem is as difficult as
consequential.
In may re¬
marks I
not do
justice to such
a
stupendous situation, even if I
had the capacity to do so. How¬
ever, in view of the impact of the
problem on the course of the
economy, which I have been dis¬
cussing, I shall suggest a question
and venture a reply in terms of
the generalities, directed to the
single point, viz., that economic
can
And let
us
BEWARE,
The forces
that tend to destroy will continue'
their efforts. They will look/upon;
the verdict of last week, not as a A
defeat, but as a challenge. Amer¬
enterprise must continue to A
demonstrate to the world at large, A
and to our own people in par- •
ican
a free economy pro- A
always an expanding vol¬
of goods and services made/
available across a widening front A
through lowering prices, thus in- A
suring higher; living standards A
ticular, that
duces
ume
and
life—a
abundant
more
a
• ■
everywhere, according to A;
my belief—if we are to establish
and maintain peace throughout
•'must"
the world.
I'v
'
•
-
A
>; t
pears
it.
from those of the same period of
War No. 1 in that this adjustment
Comes in the face of
satisfied
Services,
demand
more
a
for
large un¬
goods and
particularly in the
durable
area.
•
aqd, semi-durable goods
Following this period of
political considerations in¬ adjustment, there lies ahead, I be¬
volved. /All this is plearly evident lieve, a limited period in which
will
be
sustained at
in the moving picture of current industry
a
which the de¬
rendered will have a
cision was
moti¬
of the
"Petroleum—1946" provides investors with
definite answer in
vating policy.
most
Years
newest survey
a
sense
It was
common
eco¬
,
Our
of
petitive system of free enterprise/
as the keystone of the American ;
nomic power of labor to the
economy for some years to come.;point where the publio inter:
It completes an era.
It ends a:
A Aests are not substantially ef¬
political regime that developed its •
fected.
power by discouraging and dis—
Expressed otherwise, we must crediting, both economically and ;
erect and maintain a bulkhead so
socially, business A enterprise. AAA
decentralizing
or
selves whether it constitutes an
significant problem
economic crime or a political com¬
manufactured products and fur- prices,-that is not true as to others. that this country faces today is
Such is too likely
the position of labor with its po¬ edy, or both.
tfygf intensified shortages of es¬ And in all probability the favored
\
litical,; economic and social im¬ to be the pattern;
sential materials and supplies. -A; • group
represents
a
relatively plications. Monopolies can exist
Summary
in .a democracy in certain public
I summarize my remarks this
services, hut as such must be sub¬
. A
A
ject to complete regulation. Mo¬ evening oil two counts:
First~We can expect, I believe;
nopolies can not exist otherwise
a decline from
present levels of
in an economy of free enterprise
because such an economy is based activity, increasing in intensity to
the extent that there develop fur¬
on competition
and the elimina¬
tion of all restraints on trade, ther increases in wages and hence,
whatever form they may take. prices. • Such recession continuing
raw materials and
Day,
Election
Second—On
wave
more greatly needed.
The need of
Let those who be¬ cooperation Aamong
economic
ternative appears to be to. accept lieve in such an approach of this
groups, remains unchanged.
The/
a
smaller volume of production vital problem, read the report
necessity for constructive leader-/
with reduced employment and liv¬ submitted by the General Motors
ship, nationally and of all eco¬
ing :/ standards
than A otherwise Fact-Finding Board issued last nomic
groups,
is
accentuated.
.
^cfion of both
prices
swept;
badly
answer,
And in two across the country.
needed.
The people answered a^
highly
consequential
question:bargaining must be
"Yes, we have had enough!" The
<
■
on
Thursday, November 21 >194?
Halsey, Stuart Offers
Northern Pac. Equips.
An underwriting group headed;
by Halsey, Stuart & Co. Inc., were A
successful bidders Nov.
issue of
19 for
an.
-
$6,^80,000 Northern Paci- A
tie Ry. equipment
trust
certifi-,
cates.
The group bid 98.718 for a
1%%
coupon,
:
net. interest cost
of
1,983 %.
The issue "wag relevels higher in relation to pre¬
offered at prices to yield fromL
war as measured by physical vol¬
1,15% to 2.125% according to ma¬
ume.
We must remember that
turity. The certificates issued un- :
the status of the durable and der the
Philadelphia plan, ma¬
semi-durable goods industries im¬
ture $688,000 each, Dec. 10, 1947 r
portantly influence the state of to 1956 inclusive. The
offering is
activity of the economy ;,as; a made subject to the approval of
whole/
Production has beph so
the Interstate
Commerce
Com^>
limited in some instances, thht de¬
mission.-/. ; A A':,A Av A/
mand has increased rather ' than
through the influence
depreciation and obsolescence.
Expansion and rehabilitation pro¬
grams have been both delayed and
a
decreased,
of
deferred due to limitation on con¬
struction
After
the period of adjustment this de¬
and
high
costs/
mand will in turn further encour¬
age
production in consumer per¬
ishable goods.
accepted,
The fact must be
however,
that
uneco¬
Regan Resumes Duties
'
At Barrett Associates
Barrett
York
Associates,
investment
nounces
that
Inc.,; New
counsel,
William
J.
an¬
Regan,
has resumed his association with
the
firm
Director.
as
>
Vice-President
and
.Volume 164
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4544.
one
increase in the values of
tion.
so-called
shares
productive workers. /■
The
practices enumerated are
all within management's control,
though, of course, inventiveness,
resourcefulness and capacity to
specialize vary greatly with Indi¬
viduals and organizations.
Resulting Economic Problems
But while technical production
problems are being solved, and
,over-all
labor
productivity
is
being
increased, difficult
eco¬
nomic problems are being created.
The very act of increasing over¬
all labor productivity — of re¬
ducing labor unit costs — sets in
motion forces which change the
relationships between basic eco¬
nomic factors, which have been in
state
of
rium.
approximate equilib¬
Unless
prompt readjust¬
ments
of
a
these
lationships
fundamental
re¬
effected to make-
are
full allowance for changes in pro¬
ductivity, a state of threatening
disequilibrium develops.
Every
often the cumulative
growing disequi¬
librium precipitates a decline in
production. An immediately ob¬
so
tensions of the
servable result is lessened over-all
much,
of
When and how, in a free econ¬
omy,
to adjust the basic factors-
wages, prices, profits, production
—to re-establish equilibrium is
our
most
perplexing
problem. For too long
economic
time it
nobody's
business.
In this matter the old
adage must be reversed so as to
has
been
state,
a
considered
"That
which
is
nobody's
business is everybody's business."
It is axiomatic that growth in a
free enterprise economy requires
that the values of total production
must be distributed to all who
con¬
tributed to the production in such
a way as will clear the markets of
all supplies and provide stimula¬
tion to larger achievement. Other¬
wise the forces
tending to
cause a
decline of production become op¬
erative. To illustrate: -
the
recipient
has been such as to leave
of the hundred years
in about as close an approach to
at
the end
equilibrium as they were at the
beginning. But between the ter¬
minal dates there have been many
periods of disequilibria, which,
in my opinion, have caused us to
forego much production we might
otherwise have enjoyed; and have
retarded economic growth.
v
Assume. that
practical
a
depressions,
of
as
changes
corrective
many
of
wages,
production and
other factors as would be neces¬
prices,
to
maintain
equilibrium.
Moreover,
remedial
corrections
are much
more costly than prodiscussing the mechan¬
adjustment I offer for your
consideration
some
preparatory
generalizations:
industrial
Our
:
For more than one
hundred years productivity has
been growing at a generally inrate.
creasing
before
Just
of
all
the
Now
income
balance will
be
of
fundamental
economic
tries and especially in industries
1;' whose demands change rapidly,
i
are, by nature of the forces in/volved,
greater than in the
service and hand-craft indiis-
dustries.
4.
"
.
moment
unrealistic to
act
on
I think that the total change in
wages
whole.
technical efficiency
a
within the control of-manage-
)
/
'
an economic
The former can be
practiced to varying degrees by
ment, and there is
efficiency;
various
within
V
industries
industries
units
and
to
end
the
that
they experience differenYys tial growth without any general
a
increase
wage
7
cy
on
the
bargaining. unit
How the total wage increase of
the
the other hand requires
bargaining
prices and production and profits
order to retain employees.
must be
taneously
by adjustment through
long
it should increase his
profits by enlarging the;
run
dollar
market for his goods, even paving
the way for profitable expansion
of
plant capacity.
The business unit which experi¬
dicates
of
one
the
provinces
-
\
*
.
,.
I have stated a few
simple facts
of economic history and their im¬
plications as consequences of the
operation of the laws of competi¬
tive enterprise.
These laws must
be observed if the economy is to
remain substantially free.
Yolande
Corp. Stock
Offered at $10 Per Sh.
Public offering
of 50,000 shares
value common stock of
Yolande Corp., New York, Was
made Nov. 19 by a banking group
headed by E. F. Gillespie & Co.
Inc., and Childs, Jeffries & Thornof $1 par
dike, Inc. The shares
at
$10 :each.
were
may then be
by additional
credit, repeating the cycle at the
higher level of production —
larger over-all labor productivity,
such
Simul¬
industries
may
Proceeds from
the sale
of Island
Needlework, Inc.; to
tire 625 shares of 6 %
definite
called
reimburse the company
for
be
ance
will
be
added
capital.
to
.
working,
.
production
and
must
between
buying
be
{Without Par Value)
can
by
Price $36 a Share
is indicated
as
a
in which such
77.
8. Industries with
ing
rapidly increas¬
productivity could price
themselves
to
an
of
articles
■
,
uneconomi-
cally small share of total pur¬
chasing power if they were to
pay wage increases in propor¬
tion to their own productivity
increases, or even if they were
to
pay
substantially higher
wages than the general average
for the class of work performed,
9. Prices
may be obtained from any of the undersigned only in States 7;
of the undersigned are legally authorized to act as dealers in
:: ; .
securities and in which such Prospectus may legally be distributed.
<-
Copies of the Prospectus
reduc¬
tion in prices.
effective
power.
labor
productivity,
increased
indefinitely
course
of
total
Common Stock
particular companies or
experiencing above
average increases in produc¬
tivity could pay more than
a v e r age
wages • at
existing
prices, or could lower prices at
average wages, their economic
re¬
values
has
industries
values, one of two things must
happen: either, economic demor¬
alization; or an immediate up¬
ward adjustment of workers' real
balance
tasks
7. When
incomes have not risen
incomes. A
routine
whose
MORGAN STANLEY & CO,
MERRILL LYNCH, PIERCE, FENNER &
the very great net increase in re¬
improvement in over-all labor
productivity, and the prices of
WATLING, LERCHEN & CO.
LAURENCE M. MARKS & CO.
HORNBLO WER & WEEKS
duction is not subject to much
Oyer
the
past hundred
ceipts of the parties to production
has matched
the
very
great net
most
K
personal
services must
rise with increases in over-all
November 15,1946.
7 7 y
•
••
Vy.
GLORE, FORGAN & CO.
PAINE, WEBBER, JACKSON & CURTIS
BEANE
CORPORATION
FIRST OF MICHIGAN
■
pro¬
years
EASTMAN, DILLON & CO.
BLYTH & CO., INC.
'
y-7"':
mon¬
spent in the purchase of prop¬
erty and equipment, and the bal¬
eys
methods announced earlier.
to absorb increases in production
established
in
energy and manipula¬
re¬
preferred 'stock, $100 par value,
at $110 per share
plus accrued
dividends from July 2, 1946; to
The offer is >M<sdaohly:byih$PrpspectU8.
limitations; but the over¬
all productivity, which is often
-'YYyy^-y:
above-average profit. When the
time arrives, as it must inevitably,
for repayment of that part of pur¬
chasing
power
represented by
loans; or, when the part of pur¬
chasing
power
represented
by
profits, which is used for new
capital facilities, can no longer be
employed profitably because
workers'
engaged
this
cumulative
Consumers Power Company
productivity of individuals
of
stock, together with other funds
to be received by the company,
will be used to purchase 10,995
outstanding shares of capital stock
tive
,
offered
-r-:v;-777 yYy
500,000 Shares
.
stimulated
But remember that part *of the
total purchasing power is repre¬
sented
by credit and part by
of
economic forecasting.
This announcement is neither an offer to sell nor a solicitation of an offer to buy any of these shares,
and comparably useful
productivity measurements of
similarly classified workers in
different industries are practi¬
cal impossibilities.
Production
lower unit costs.
may
tional income.
Economic efficien-
dislocation.
for
should be proportional to the total
change in real income of the gain¬
fully employed workers of the
country, estimated as needed to
absorb the output of proven pro¬
ductive capacity, thereby making
way for further increases in pro¬
ductivity. The proven productive
capacity is reflected by the new
high level of (peacetime) real na¬
*
5. Exact
con¬
from
6. The
tained.
in
temporarily reduce profits, in the
•
Except in the simplest occu¬
pational operations, changes in
productivity attributable direct¬
ly: and
solely to individual
workers, cannot be measured.
main¬
further
law
free economy.
He must act on
the belief that while at a given
a
;
.
factorily-profitable capital goods,
economic
.
employer, must hold and
exercise a strong conviction re¬
garding the inexorable operation
current economic situation. In any
event appropriate action may re¬
■
ap¬
the sale of products can be utilized
for consumers goods and satis¬
Changes
■
production;
workers* compensation remaining
constant. Total output is increased,
is reflected by greater over-all
labor productivity and lower unit
if
general dislocations.
an
.
stimulating
Profits increase;
of Wage
'
offered, enlarging total purchasing
costs.
ous
or
The wage change initiator, if he
employer should
y
growth of real per capita inthat each operator perform his be distributed among his workers
come was about ten times the
is a secondary economic problem,
role with due consideration to
rate of the decade of 1850. Con¬
the effect on the entire econ¬ as distinguished from the funda¬
sequently, maintenance of equi¬
mental economic problem of re¬
omy.
librium
now
requires
much
lating the total wage increase to
C. Prices of commodities at whole¬
more
frequent adjustment of
total increase in national produc¬
sale collectively move generally
basic
economic
factors
than
tion, and may be the subject of
v
side wise.
heretofore,
further collective bargaining.
2. The change in over-all labor D. The cost of living moves gen¬
Once
the
pattern
of
wage
erally
upward
even
while
productivity Varies significant¬
change has been set, other indus¬
prices at wholesale collectively tries
ly, even greatly from plant to
may follow either on the ini¬
remain constant because of the
plant and from industry to in¬
tiative of business statesmen or on
inclusion in the cost of living
dustry.
Some industries' ex¬
the initiative of labor. Industries
vi of the values of human services
perience much more than the
experiencing only relatively small
not susceptible to. any or much
yy: national or average increase in
increases in productivity, or even
increase in productivity.
productivity; some less than
declining productivity, may defer
In free enterprise economy the
the average; some experience
the making of wage increases but
avoidance of serious disequilibria
;
declining productivity,
;
sooner or later, they too will be
3. Changes in productivity in the resulting from the accumulation
mechanical
(powered)
indus¬ of maladjustments between wages, forced to follow the pattern in
.
sider:
ity-
B. There is
dynamic.
World War II the annual rate of
over
center
due consideration to the econ-
-
is
economy
and
economy may
at least approximated with the avoidance of seri¬
;
opinion, by the employer who
has the greatest stake in maintain¬
ing economic equilibrium. How¬
ever,, under today's conditions, if
an employer of vision and influ¬
ence
cannot be found to begin
corrective measures, the initiative
will
pass
to
organized
labor,
which is quite well informed on the
objective
base d fundamentally u p o n
changes in national productiv-
is
ism of
1.
that
my
rational
a
; omy as a
Before
Problem
the assumption that any busi¬
ness can be conducted without
phylatic measures.
-
should
end
the
If wages are to be changed, the
movement should be initiated, in
especially in
bargaining
increases
are
equilibrium in the
be maintained
be
often
seems
move¬
find it necessary to increase prices
for their products. By such means
ences a declining productivity, but
quire both employers and labor to which must increase wages to
;; , - .V
operate through the
collective hold
workers
while
increasing
j Then there are a few corollaries:
bargaining
process.
The
chief prices to prevent immediate fi¬
A. Free enterprise
continues to question then is:
nancial loss, faces gradual forced
provide the greatest stimulus
How much should the wage
liquidation and must be guided
to economic growth yet known,
accordingly. This eventuality in¬
change be?
"
:'••• but it
sary
proach to economic equilibrium
exists. Assume credit is now freely
power,
10. Collective
If
increased
effected, to
incomes
markets cleared.
periods when wage controver¬
sies prevail.
around
,
*
economics, which
to be overlooked,
wage
which in the end necessitate fully
real
statement expresses elementary
Avoiding Maladjustments of
,> a,
Depression
maladjustments
ments
This
result of loss of demand.
Turning to the present and pre¬
paring for the future our problem
;v
is how to avoid or minimize the
the
enumerated.
several
in
increases
the
the basic factors of the economy
improvements
laboriously made by the applica¬
tion of the specific technical prac¬
tices I have
net
of
groups
labor productivity, which for an
indefinite period cancels out all,
or
The
or
combination of such
some
national
productivity,
or
else financial losses, or inabil¬
ity to enjoy current living
standards, will cause cessation
of operations.
If the commodi¬
ty or service is non-essential,
operations may decline to the
Vanishing point anyhow as a
produc
of these factors.
more
productivity is rising, wages also
must rise or prices decline,
or
Increasing Labor Productivity
(Continued from page 2610)
ate the growth of productivity of
or
2625
.
THE COMMERCIAL 8c FINANCIAL CHRONICLE
has become increasingly aware of
the useful seryi.ee which invest¬
ment companies
'"Among the
its
thoughts and base
ment,. polipies. .
,,
ciary
and
accounts.
More
particularly
for; fidu¬
and
the
has been abandoned to the search
for undervalued securities.
" The
seldom
the cost of the
dividual
of these
lieves
in¬
of confidence
oq;
in a fidu¬
ciary capacity is encouraging, riol
but
it
the
men
increased
means
because
of
the
involved.
;
of
sales
character
Traditionally
in
accounts
the
small
and
early
in;
of
in¬
years
time
its, shareholders,.
,
market, the company
cation
his
on
trustee
finds
for
investment
prob¬
-
of
company
small
accounts, and
else who lacks either
anyone
or
account, for the
which
losing money - on a
own
trust
or
itself
time
experience, the open-end
management company can provide
a much-needed service.
"*.
.
.
Dividends
Wellington Func,
car.
commitments in advance.
no
to
for the small investor who
cannot obtain adequate diversifi¬
lems,
iric^A
year-
end/: dividend / of 70 cents per
share, payable Dec. 27, 1946 to
any
set formula and while it
may re¬ shareholders of record Dec. 11;* 12
peat itself,- the pattern contiftua Uy cents being from ordinary
incojne
changes, old sequences are -re¬ and 58 cents from net realized se^
versed, and now the tempo has curities profits. All or part of the
been quickened under the stress total dividend"
-may" be taken' hi
of the atomic age;
stock at the holder's option at the
"Owing to the .emphasis placed
small
much
real
a
History does not develop in
conservative. of allr investors.
To
pass the rigorous -test of his ap•proval is very gratifying. " ,' "
j
vestors
the
make
of
the trustee is the most careful and
on
for
perform
can
i
considera¬
investor of today has
ample worries to plague his days
and make sleepless his nights. For
the busy man who cannot devote
to, the' detailed methods ol
executing these policies, and thc
anticipated timing of cyclic moves
part of persons acting
because
it
these
tions,-the
"As
the
from
policies, the company be¬ multitude
that
service
required.- This dem¬
care
onstration?
of
'
./"Aside
framework
The small percentage
each* of -these accounts
covers
retention
fear.
other-people's doctrine of
'buy and hold' 'was
have placed a part of their discarded in
the early thirties aiid
the company now attempts to" as¬
This, of course, has been especial¬ sume a cash
position when it feels
ly true of trustees and institutions that the market is
too high. Capi¬
handling many small accounts be¬ tal;
appreciation, has always been
cause it
frequently happens that a cardinal aim of
Incorporated In¬
even' if sufficient diversification
vestors, but even greater impetus
is possible, the costs/of handling
has been given to this aim in re¬
these accounts is distinctly un¬
cent years. Within the
on
the
economy,, without too great in*
roads by socialization.- Any other
accounts with management -trusts.
economical.
international
our
the profit system ,in the country's
money
charged
and
early conception oi assumption/ would be based "on
buying- only
the « largest
and fear—and no progress or profit
strongest companies in each field can ever be made on the basis- of
of
care
of
differences
vestors. ' The
more,
years, trustees; trust, companies,
and various institutions charged
with
abatement
1
"The development of an invest¬
ment policy has been described in
the
case ,."of
Incorporated
In¬
in the last few
so
invest¬
-
more
in orders placed
crease
its
;^; ;:
perform. /
recent mani¬
festations of confidence is the in¬
.
Thursday, November 21, 1946
"The most immediate problems
of; this point of time that fate the
vestment trusts, a feeling grew up
that /the; field; was unsuitable
asset value of the shares at
close of business Dec. 16.. /:*;.;/ .f
Massachusetts Investors Second
net
'
investor- are-reconversion^ labormanagement conflicts, and infla¬
for
Fund, Inc.
A special year-end
tion.
There are doubtless many dividend of $2.40 per share out of
gradually losing force./ Even
other questions that need
net realized security profits pay-answers
though a management trust is an
today and the events- of tomorrow able-Dec. 24, 1946 .to holders of
obvious
vehicle v for
such
larger ;accounts.
*
This
.idea
has
c
been
?
small
will
funds, many large accounts have
recently come under the care; of
"
problems of equal record Nov. 22.
y "
/
International relations,
Eaton & Howard Balanced Fund
pose
new
urgency;
the
ever-present menace of the
atomic bomb, and even the uncer¬
tain direction of our federal
gov¬
investment ..companies. Incor¬
porated Investors, for example,tin
—A dividend of 30 cents per share
from capital gains payable in stock:
Dec. 24, 1946 to holders of
recprd
already much on the Nov. 29.' Shareholders have op¬
country's/mind; ® The^ Impact • of tion ta receive cash or stock; |
over
$100,000.; This develop¬
such external forces on
invest¬
ment is encouraging for the same
Group Securities, Inc*—The fol¬
ment values is sure to be
reason
decisive, lowing dividends have been de¬
astthe increase in order!?
but no one can predict with con¬
clared payable Nov. 20, 1946 to
for fiduciary accounts, since these
the
12 months ending
June 30,
1946, received 18 individual prders
ernment are
of
large investors
with their
...
/
"Men who
the
are
funds,
-I.
know
it;
that
fidence
the
eventual
issue
of shareholders of record Nov.
4^ In
equally careful
V
1
i f these, the most pressing probl ems the case of Agricultural Shares,
.*-'Vyr.
of
..
used to handling
affairs
of
others
are
financial
tinued
-
,w#,.
v.-,.
no
of
guarantee
success
can
ever
our
times.
vestment
rated
con¬
the
Nevertheless the in¬
General
Bond
eventual
solution
at
or
be made.
least
payable in stock
The records of the past may
give
some'indication> of the ability/of
the management, but the investor Agricultural
must not be too
dom
of every
;
The wis¬
investment cannot
Aviation
ture.
It
is
on
this
elusive
.40
.01,
.14
.05
.05
—___
..
.46
a
.
4)7
.19
.05
Equipment
Fully Administered
•/
Bond
Industrial
Machinery
Institutional Bond
__
Investing Company J
Preferred
Low
Priced
Merchandising
Mining
Stock Fund
//:////://;/
';/
Food /....
mhst fix
General
Union
/
...n......
Electrical
future
cash.
.06 ;
.
Building
established, until an uncertain
Chemical
date in a continually receding fu¬
or
.06
...
:
be
that an alert management
Merchan*?
For Fourth Quarter
Regular Extra .Total
i_..
Automobile
hopeful.
Shares,
philosophy of Incorpo¬ dising Shares and Railroad Bond
is; predicated on Shares the extra dividends are
Investors
Petroleum
/"V-/S.■■ V V/*':-l|S
upon request
Bond
Railroad
Equipment
Railroad
Prospectus
Railroad
Stock
..i..
Steel
r-....
Tobacco
Prospectus from your Investment Dealer or
Utilities
.
...
J
.
.
.1
_
.
HUGHW. LONG& CO.
INCORPORATED
iNCORrORATeo
.
48 WALL STREET,
NEW YORK 5. N Y.
lO$A«iGUt>
Chicago
—
Los
SHARES OF CAPITAL STOCK OF
lThe vi&ws .expressed
in this artiple ,do notJneCessarily coincide
of the "Chronicle .?/, They, are presented as those of the
author only.\ -.
j
, .
„,
,
/
/////v?.'
*
p-
r
ivith
Angeles
CHiCAGO
those
I
INVESTORS
j
selective puho inc.
INVESTORS SELECTIVE
FUND,
/
Prospectus
Prospectus
from
pour
map
local
i
The
he obtained-
investment
;
dealer
or
>i
Keystone Company
of Boston
A
local investment dealer,
or
INC.--i/;/i
request from Principal Underwriter
INVESTORS SYNDICATE
Prospectus may be obtained from
your
on
.
v
R. E. Mocgregor, President
-
;
.
;
Minneapolis, Minnesota
.
;
/-
••;
'•
"
50
Congress (Street, Boston 9, Mass.
THE
PARKER
CORPORATION
ONE COURT STREET. BOSTON 8, MASS.
representatives
in
the
principal
cities
of
the
united
states
j
Volume
*.
•>>.
1
V
Number 4544
164
A Central
i
\i
THE COMMERCIAL & FINANCIAL CHRONICLE
guaranteeing plan, covering com¬ original lender free and utilizes
mercial loans up. to 75% ol their his
fupds alone unless and until
Undezwritihg Fund for Small Business
face
without
amount
individual
the
transfer
of
risk
is
needed,
Corpora¬ their term loans to large bofrow¬ examination of the risks, but with should bri the prevailing plan of
'.-;!.*■'to preference or to. nonaccess to; tion.4; The assistance, limited to ers, from an estimated $217 mil¬ certain standard requirements. operation of the central fund. The
with,-- maturities
of
not lions made in 1938 '.. to an' esti¬ Neither of these differently lim¬ types
external funds is debatable. When credits
of business
situation
fi¬
-f small business voices a demand for more than five years# and, in the mated
$1,352 millions made in ited central fund plans has been nanced, the relations between the
fully tested as yet.
V
; Y
/external funds, it is likely to be case of the Federal Reserve# to 1940.6 * / •:. ;/
guarantor and originators of the
>(x\. ;;
v (Continued from page 2613)
•>:,
construction
Finance
-
,
•
<
.
.
Yan. imperative
v-
demand,
\
...
k i
w o r
n
capital
g
■
took i
credits,
three forms: direct loans made by
'•|YY
The problem, primarily, reflects the
agencies
from
their
own
;
ii.v;5'ari'*dnstitutional gap in that it in*'
i:;if volves a form' of risk-taking to funds;, loans shared by them in
participation with banks or other,
rYV/Ywhich the existing structure and
■
-
the
prevailing standards and prac-
commercial
institutions;
lending
and loans made solely by the
pri¬
•Y^tices of the nation's investment vate lenders
% with- an i agency's
y.';
and • credit. >J institutions
are
ill
underwriting or- guarantee. The
-YY*
,
•
adapted.; The rijeluctanee of funds
•to flow into venture enterprise is
amounts
so
loaned
guaranteed
or
During the Second World War
,the
financing
problem
business took the form of
This
a
was.
of
leases
cash
.
in
through
part
equipment
and
direct
loans
Plants
less
met
1
*'■••
;v
previous times the individual guarantee emerged oyer an eightcapitalist placed his funds year period as the- best of the
on
an
ownership basis, three forms of credit support, be¬
i:
)»;
•;
local
directly
in small but
promising enterprises came the fundamental plan of the
YY with which hp was iii touch. He
large-scale financing of war pro¬
shared their risks and profits out- ducers by the commercial bank¬
right, ordinarily not burdening ing system in the Second World
/them with hypothecation Of^assets,
fixed charges, and debt obliga•
tions.
His
ally was often the so"personal", banker of the
locality# who also supplied the
called
\.r'
principle
permaneint solution for the
ternal
ciently
upon
;
credits.
shortrterm
and
that
so
ex¬
be
can
sources
risk
the
extended
financing problems of small longer term as well
It is generally
agreed term loans, into the
as
into the
the short-
by the Smaller War
area of small
Corporation to firms with that direct Government lending to business, and into the finariCing *
500 employees, and in business, involving dangers of sub¬ of the important venture sector
than
sidization and of Federal invasion
of
of
private enterprise both in in¬
dustry and finance, should be at
most
business
enterprise.
•
•
-
ing capital and fixed capital needs
emergency measure. Also
an
of small business. It may be sum¬
accepted that the marized
from
three
points
of
commercial banking system, with
view.
From that of the business
its 14,000 outlets, its unparalleled
that
needs
external
funds, the
guarantee of loans under Regula¬ ability to make contact with the endorsement made
by the central
tion V drew on. the commercial smaller
enterprises everywhere, fund amounts to a
supplementa¬
bank as the source of funds and and its abundant financial re¬
is
it
generally
f
.
tion of the loan collateral
reemphasized the effectiveness of sources, would provide the best
a
central guaranteeing plan be¬ possible solution. of. the institu¬
security that it
War, -and is the' central plan ad¬ War
Plants
Corporation
author¬
vocated today for a lasting solu¬ ized $504 millions in loans and
tion* of
the
external* financing leases, all to small concerns.'The
V loan guaranteeing system au¬
problem of small business.
,
difficulty if an adequate
portion of its credit capacity could
be
enabled
to
ventures.It
onstrated
will-
.
finance
has
that
finance
been
commercial
difficult
built,
is
protected
earnings
increased by
"new business," which it other-»'
banks
-
liquidity
its
its
and
dem¬
and
other
or
supply. From
institution, the
behind its loans is up¬
security
business
well
can
<
that of the lending
hind credit risks in enabling bank tional
credit funds to flow. The Smaller
,
This plan applies to both work¬
wise
off-
could
that
not undertake.
the
of
central
From
fund
itself, a
"pool of risks" is created, and the
operation is essentially that of an
thorized
$10.3 billions in bank standard business situations if in
primary form of guaran¬
developed * by this 12-year predit to war contractors of all so doing they do not jeopardize
|^"These two traditional figures were experience is the "take-out agree¬ Sizes, and was an outstanding their responsibility to depositors
J" small business* appropriate fit ment" or "deferred participation." feature of the financing of war rind stoqkholders. The obstacles
;
nancial source.!
/
large maj ority are mainly twofold: the need for
The commercial lender makes the production." The'
yy 1 " Both. have, largely disappeared, original loan to a business with of borrowers were. of medium a modification of credit standards,
•vS/Ythe one in favor of the investor its own funds and services the sizO or small; loans authorized for which are somewhat entrenched,
an securities of listed corporations
loan throughout, but it does so firms having not more than $500,- and the necessity that the indi¬
total
assets
i
and of Government, and the other under an agreement entered into 000. in
aggregated vidual bank
primarily the
bank
—
be
/ minder the influence of the modern
at the start whereby at any future $835 millions up to March 31, 1945, smaller
protected
objective standards of loan secur- time the commercial lender may ! Since ^thc-waf, -groups 'of- the against undue loss of liquidity
seasonal
■
liberal
margin of credit from institutional
business.
are
'
1
summarized
which current thinking centers as
.
were not large, but provided re¬
greater part through the guaran¬
lief
in
individual' instances.
A teeing of commercial bank loan
institutional, and the)
risks
by the war procurement
YY Ventures small and personal, this primary significance of the ex¬
1*
perience was in developing the agencies through the agency of
v
problem becomes more acute.
■
guarantee or particular case/in¬ the Federal Reserve System under
surance of commercial loans by a Regulation ;V; ;of / the
Board of
Historical Basis of Problem
-'v 'V*';? '-; /
central underwriting agency. The Governors, The-arrangement for
X \
'•**<
y V»Y'-
•
experience
above points to the
of conversion and expansion cap¬
ital for the small war producers.
the underlying problem. When the
funds
;
The
lack
a
credit,
and
the
percentage
of
risks contingently assumed by the
central fund, should all be suffi¬
.Central Principle of Solution
small
of
The
tee'
;
*
insurance
system,'" though, less
rigid than formal insurance. The /
plan is not new; its features have
been tested in other connections;
it merely requires adaptation as a
permanent feature of the banking
system.
Y./Y Y >■/ Y:Yy,
.
,
.
•
—
.
i
-:
Application
to
Working
'
ity and Of the avoidance of risk sell part of the loan to the central larger commercial banks have of¬ and undue financial- risks on the
Y
an bankings The unsolved problem
/
guaranteeing, agency. If all goes fered central \ protection ta the credits it extends,
is that of. their replacement. Va- well with the loan, the option to
smaller
banks
There should be established, as
through a form
1 1 ' rious attempts have been made to sell is never/exercised, and the
of credit pool that offers outright a permanent feature of the com¬
^/ devise1 some form of institution guarantee fee—stated as a portion loan participations rather than in¬ mercial banking system, a central
that will finance the fluctuating of the interest rate on the loan, surance type guarantees. Also, the fund to be used for the under¬
v| enterprises and ventures. In the and paid by the bank as a premi¬ Reconstruction Finance Corpora¬ writing or guaranteeing of busi¬
T
years prior to the First World um for the contingent protection tion, backed with Federal Govern¬ ness loans, particularly of those
i
^War, when the problem first be* —goes into the central guarantee* ment tunds, has offered a blanket credits that an individual bank
cannot extend if it must assume
jgan to emerge,- some communities ; ing fund. But if in the commercial
6 Neil H. Jacoby and Raymond J. Saulraised local funds to provide cap- lender's opinion loss is threatened,
the entire risk. The deferred par¬
nier, Term Lending to Business, National
uX ital for local enterprises. About : or if the • commercial- lender de* Bureau of Economic Research, pp. 2-3.
ticipation plan, which leaves the
V'
20 such funds exist today and in sires to become more liquid, the
lender exercises his option and the
some cases their work has been
-valuable, but the movement has previously agreed-upon portion of
t mot become general.2 A revival of the loan is bought by the central
/
this type of organization, with guarantor.
Thus
the
"deferred
d
Government backing, was recom- participation" becomes an actual
v
friended in 1945 by the Investment one, and from then on the loan
^/Hankers Association of America.? is a partnership transaction be¬
:
.
'An
•
the
number of
increasing
started in
small businesses
mew
the later 1920's were financed in
considerable part from big busi-
•
.
which needed new
tparts suppliers, outlets, and sersources,
fiess
>
While
-vices.
marked^ develop-
a
tween the
originator and the guar¬
American Telephone and
both the profits and the
losses being shared pro rata on the
Small
businesses,
* volume
sales
tively large
users
agreed,
has
their current
nancing
v
r
i/ i*'
'Y-Y,
^
*
t
...
*'
-
»
"
'
the
(Continued
/
,7 Tfcution of petroleum products.
Telegraph
>*
'
1'■
*
*
"
"vV
<
X
sY"
-
<<•
t
>
»
.*1
,
>
■< >
\
cussion Vof
j
-
In
1939-40,
when
YYiV
;•./
Y'..
«_V.
.Y
.Y-
7-\ -•' >'•
Warrants representing Rights
this plan.
jJ..;',:
small
the
,
;
to
subscribe
the above named Debentures
to
of the
A copy
principal
of the Prospectus
with resulting business flourishing development of high.discontinuances that added to the cost lending institutions. The sur¬
tal credit,
I
'f';
the depres1: :Sion. Congress met this situation
^
part by inaugurating m 1934
Y direct financial, assistance to pncumulative effects of
amount
u"
i;
at
ioo%
thereof
;
■
f
V.
2 Chamber
flans
Commerce
into
the
capital
small
field,
business
also
the
finding
caused
of the United
at the
time, although
Financing
banks
were
Industrial
Community
states,
f
of
(in mimeograph). Also, Ernest J.
The Louisville Industrial Founda-
undersigned
emphasized the need of a
greater entry of commercial' banks
This
li
he obtainedfrom and orders may
vey
working
need
that
Blyth & Co.,: Inc:i||
Y
should
make
long-term
business through the Fedcapital loans to small business.5
cral Reserve System and the Re-
■
may
be executed with the
/
banks
-vate
j
controversy
14 Wall Street
y.,vyY
New York 5, N. Y»
;
commercial
currently increasing
.
•
'
-
|
1
-
-
-
,
REctor 2-1900 '
■>, :
\
'
'
' ■
Honkins
i
tiorc
?.
"Bank
tion
Vt
'
A
Study
in
Caoital
Business
i Bankers'
for
4
Community Cdpitaliza-
ol Local Enterprises,
of Atlanta, 1945.
on
•
1
and
r;
.
'
2628)
(Convertible April i$, 1947 through December 14, X9S8
unless called (or previous redemption)
better. There will be further dis¬
the depression of the 1930's not business situation was investigated
YyS -only drove venture capital into by the Temporary National Eco¬
Sliding, but also brought- the ex¬ nomic Committee of Congress, it
ternal financing problem of small w&s found that the restrictions of
Ibusiness to the acute stage where the 1934 legislation had prevented
J working capital supply was re- solution of the : equity ; capital
t :®tficfed/ Lending concerns m problem of small business, while
•search
of
liquidity terminated the period of working capital
"
had contributed to a
short-term lines of working capi¬ shortage
■
on page
"
especially among
engaged in the distri-
advancing
:is
concerns
;u
'
«
■
:~rrX
■
variety
Despite the variety,
particular situation is often
sources.
Due December 15,1961
•
Federal- Reserve
Small BusinessA. State•
Policy by the Small
National
Committee
Association*
of
to
Through
the
tion
the
Federal
5d
to
addition
Reserve
the
e„
the
Investment
•;
Corporation
5-
-
of
Act
Section
and
Reconstruction
Act.
Temporary National Ecdnomfc
of
Congfess, Problem* ■ of
Business, (Monograph. Ne. 17),
mittee
13b
NEW YOftK i
BOSTON
SAN FRANCISCX>
SEATTLE
of' Sec¬
Finance
Com¬
Small
CHICAGO
'
PIIlLAOEtPIIIA
LOS? ANGELES
cap¬
operations
obtain it at present from a
of.
Fifteen Year 2%% Convertible Debentures
"pool o£ risks"; some indi¬
a
•
"
of working
ital. Those that need credit for fi¬
Company
t
higl*
rela¬
are
It may be observed that under
this plan the central underwriter
problem of the vidual transactions will make a
pseudo-independent or ' Satellite return while others will incur a
i ismall business also rose, and the loss; This is fundamentally the
YY/f, danger of increased financial de¬ principle of insurance, and it is
pendence of small business upon regarded as the key to the insti¬
"the large corporation was driven tutional ' financing
of
business
; • 3iome. A current inheritance from
ventures whieh cannot be under¬
;
.*the 1920's is the movement for taken singly but can be under¬
'YYY the attainment of true indepen- taken in aggregates or groups; the
;
and more diversified the
/ .dence by such enterprises, which larger
.
their
ment resulted, the
:;
•
as
implies,
antor,
basis previously
•
This plan applies, first, to credit
for working capital purposes.
,
'
'
2/Y/
Capital Credits
Y^Y-'Y
PORTLAND
/
;
/
[iw.w>iiiii>iWi>iiw?^i^^rm^<f'''*it^'^Mma wMMkw -
THE COMMERCIAL & FINANCIAL CHRONICLE
2628
Whether there will be
Consumers Power Co.
dependent
"Our
Issue Oversubscribed
Morgan
a
which
ers
fered
31
Nov. 15
on
has
of
scribed. These shares
ed
the
to
Nov.
13
share.
$33.5399
stock
the
shares
owned
of
its
will
thus
parent
12.1%
nancing
fering
constitutes
of
public
.
Consumers Power
became
holding
the
from
cided
not
include
anticipated.
of
it
the taxable 2s
too favorable
rumored
reception.
the
of
some
offered for sale
were
a
that
after
seeking
the
shorter
despite
a
somewhat higher return with
range.
market
on
a
maturities
adjustments
construc¬
still
are
a
that
will
generating
A Central
have
to
be
.
Underwriting
Fund for Small Business
with
as a prac¬
tical matter to shift to
any other.
What is most needed with respect
not
be
turn
exactly
out
had
as
been
pacity of the clients. The charges
are
inevitably somewhat higher
than the charges of a
correspond¬
ing service to large concerns; the
.
.
.
This should
temporary
Panhandle
but it will have
an
the technical position of the
on
...
transmission
gas
contact and be unable
offerings of
some
to working capital is a greater
competition among credit sources, interest rate includes not
only
market, until it has been
as a control
upon rates and upon true interest, but
also the unit
cleared up.
•l
credit practices. Also greatly
cost of handling and servicing
Dealers with longer-term obligations, which they were expect¬ needed
is
a
firmer
assurance the small
transaction, plus a mar¬
ing to sell to institutions, may have to hold them for a somewhat against sudden reduction or ter¬ gin for protection against loss.
,
,
longer period, because funds for their purchase will not be immedi¬ mination of the credit, particu¬
ately available.
War loan calls will be heavy, but most of the larly in times of depression.
commercial banks are well prepared for this development, with
The principal forms of working
some institutions expecting to lose as much as 90% of their govern¬
capital credit to small business at
ment
V'V
Immediate
^VW'-JV-V"
firm
•
.-V4 4
,
bids
"V.-'V
.
on
instances in their
>*''■
V.•1
-i
■
^K.Vv'
«•
with
1■
:
^
;
.
Experience and system, however,
reduce
the;% handling cost,
can
while
*>v.
in
.
.
entirety by non-bank investors.
the Treasury
' ;
i-
...
should do has not always been in
in
what-eventually takes
place.
.
.
With the recent change
.
political
some
Gladly furnished
request;,..
line
parties and a new group in power in Washington,
uncertainty has been injected into the situation.
None¬
theless, is is not expected that there will be noticeable changes
Weekly List
.
in financial policy from that
upon
.
I "r ■-;-:v
currently being followed.
.
,
.
-
.
Semi-Annual
.
issued each June 30 and
December 31.
fi
-
customer
This
than upon the capital assets of the
business. 1
„„„
,«
-
Problems
these
in
forms
expected by most economists.
institutions
lieved that
Appraisal
still
they
are
more
likely to
rather than into other investment
ities at your
this situation.
in
the
for
go
investment
into
^
individual
cases
is
doubt continue
no
switched for restricted
;
-
,
as
to
some
small
NEW YORK CITY
fttictor 2-6528-29
private wires—
New
retirement
extent
PEnnypacker 5-7330
Philadelphia,
debt
York
Teletype—PHLA m A 897
.
.
.
the
From
program,
a
a
one
phase of the
considerable
turning back of funds raised during the Victory Loan.
now
arising from
on,
debt repayment will have to come from surpluses
an excess
of
revenues over
expenditures.
.
.
.
that
must
carry
excluded
from
this
form
of
;'
very
close
which has been to
concerns
their customers' ac¬
se¬ counts; many that do so, however,
*
bring to
con¬
exists,
accommodation
The December financing will
often
be¬
efit
The trend
lack of con¬
fidence in their credit policies on
the
part of financing concerns,
and it was in this general field
that the TNEC investigators in
1939-40 found instances of unduly
high charges. Neither the mer¬
cantile credit
by
nor
the discount of
receivables is
subject to adequate
of revenues will depend upon business conditions, while expenditures
legal regulation in some States,
will be affected by international economic conditions. .4
a
situation that emphasizes the
need of increased competition.
A balanced
.
budget with lower taxes would be
and would seem to indicate
no
very
.
beneficial;
need of financing by the Treasury
to continue the policy of debt retirement.
.
.
.
of most of
be "rolled
1947 maturities aside from
over."
.
.
certificates, which could
'
»
*
»
Jf
*
Such
Sufficient funds
Should be available from Government Trust Funds to take care
'
at
*
.
a
r
-
?
of
central fund for under¬
a
banks.
'
1
-
Application to Long-Term Capital
Needs
It is often stated that the main
.
cealed in the prices of commodi¬
ties and are difficult to calculate;
are
;-"v
DEBT RETIREMENT
are
ment of
writing the working capital loans
with
of receivables also is of much ben¬
;. Shifting of obligations will
.
it
and
channels, pending clarification of
past, with bank eligibles being
curities.
9
credit
also,;'where no> alternative source
"tie-in sales," price dif¬
ferentials, and other creditor con¬
trols may occur. The discountnig
government securities
the other hand, these
On
...
have funds available
Our experience and facil¬
PHILADELPHIA
connection
of
times when
in
tyep^ is, Jiqwever,. not expected to assume substantial propor¬
a prolonged period of poor business which
not
is
Special
INCORPORATED
rather
.
tions unless there is to be
STROUD & COMPANY
accounts
.
deposits, which has affected their attitude toward the market.
-
disposal.
•
.
.
Complete dollar appraisal
or
upon
arise at
sufficient, competition
issue of long-term high-coupon obligations will be dependent upon
is absent. Thus, while mercantile
business conditions.
4 What this trend will be may not be clear
provides most small; re¬
for some time yet, which would seem to indicate no immediate credit
tailers and wholesalers with in¬
offering of new securities.
)
\
|
ventory on a deferred-payment
SAVINGS BANKS INACTIVE
basis
and, is the mainstay
of
Savings banks in some instances are reported to have been losing countless such concerns, its costs
Valuation and Appraisal
Monthly
narrower
limits, has the credit that is based
,,
time to go yet before they will be out of the picture. . V . Therefore,
it seems to be the opinion of many money market followers that an
:T-■
central guar¬
(
also, within
.
Also it should be remembered that the authorities which have
been' administering the finances of the government still have some
:|l.'
the proposed
anteeing fund, costing only the
present are mercantile credit, ex¬ premium fee, would replace the
tended to trade concerns by the loss coverage factor. More funda¬
mentally, the guarantee, being
suppliers
of
their
inventories;
collat¬
cash credit, or the equivalent of tantamount to additional
credit, supplied by factors, fi¬ eral, would enable loans to be
made
in
higher
ratios
to
the
nance
companies, and small-loan
companies that purchase accounts equity size, in which, as has been
receivable at a discount; and lines seen, the smaller businesses are f
deficient.
The
of credit based upon accounts re¬ characteristically
guarantee also would stabilize the v
ceivable
as
security, >;orshortshort-term credit against discon-:
term credit upon other security,
tinuance on the basis of temporary
supplied by commercial banks.
or cyclical fluctuations in business
The mercantile credit has the ad¬
earnings. In this way it appear^
vantage qf being directly,,related
that the major needs of the sihall
to'the size of a business in volume
business working capital situation 5
of sales, rather than to its cap¬
would be met by the establish¬
ital size. So
,
•<.
What
V,
.
.
•
•' {""• .4
.
Phychology is also an important element in the present situation,
with reports indicating that some of the money market experts be¬
lieve that the Treasury should issue long-term obligations in order
to make use of savings bank and insurance company funds, at the
earliest opportunity.
There may be a shortage of government
obligations that these institutions can purchase at 100 to yield 2%%,
but at the present time there are at least some Treasury issues
available at yields that seem to be very attractive, when compared
with certain of the corporate issues that have been taken on in some
practically all issues.
W./•-•V-.4
deposits.
TREASURY POLICY
Offerings Wanted :§■
Two
.
.
result, it is believed that there will be
a
coming financing which did
effect
CERTIFICATES
jj
.
by non-bank investors without
new
anticipated.
TRUST
'i
.
changed because low money rates
necessity because of the large debt.
v
Accordingly im¬
are expected in the not distant
future.
.
.-v
doubt
no
.
of
securities by those who will have to adjust their positions to the
EQUIPMENT
•
into the year end.
we move
proved market conditions
a
As
Pipe Line Co.
•
con¬
s
$53,000,000 and will
natural
;•\
may
-:i0X
-
jj ;
fl J";
that
demand for available issues, the supply
...
P
conditions
Dec.
as well as
surprise to the financial district, it seems as though certain
dealers and some of the commercial banks were expecting a partial
(Continued from page 2627)
redemption of the certificates as well as an exchange offer for some monopolistic; an individual small field, with results that have
gen¬
concern may have a
of the iy>s.
single credit erally benefited the earning ca¬
'
,
is estimated to cost
of
connections
•/.
a
...
1'-.f- :o
certificate for the December
the cash redemption of the 1V2S, was by no
maturity,
ural gas storage fields and addi¬
;
:
by many of
Basic fundamentals have not
&
...
a
unsettled
financing
This should create
;
stantially
•£.!3
Although the exchange of
means
steam-electric
Eastern
is
until
made.
DISAPPOINTING
capacity, the development of nat¬
tional
are
on
of which has not been
large, and is not expected to increase sub¬
de¬
was
../'
.
Likewise
170,000 kilowatts of addi¬
tional
withdrawn, when it
was
:
to
..
excess
'
...
.
additions.
tion program
that
doubt be taken
no
squeeze" should be eliminated, as
buy these issues immediately because of the soft¬
ness of prices and a minor increase in offerings.
{. , By sitting
back and waiting, it is indicated that most of these restricted
issues have been picked up at prices that were better
than
769,950 will be used for property
-'The company's current
,:
;
,
15, or even until near the
end of the
year, there seems to be ample support for the
opinion that
periods of weakness should be good
buying opportunities.
It is
believed that technical conditions will
improve and the "money
into the market through
come
sale,
this
-
|
_
1956/59 will
Despite somewhat
...
the purchase of the ineligibles
a
Proceeds to
company.
company
line
completed.
was
Co.
subsidiary
a
due
institutions
tinue
in the process of
side of the shift
amounting to approximately $16,-
in
the
Dec.
switching from the longer bank eligibles into
the restricted bonds, and with the market uncertain the selling of the
eligibles pushed down the whole list, with the result that only one
the
to
•'
.
...
The 2^4%
.
.
were
of¬
first
stock
common
by
it
the
.
IMPROVED MARKET EXPECTED
minority interest. This fi¬
represent
that the
means
a
maturity still within the 10-year
com¬
and
15
Dec.
on
.
3,-
pany,
the
.
attitude among buyers, which resulted in a thin
With the announcement by the Treasury that the
The support that would have
Corp.,
,
vT*
yield of 1^% these institutions will have
to move out into the 1952/54
area, with the 2% due June and
December the most favored issues.
by The Commonwealth &
Southern
since
due
.
In order to obtain
maturity of %% certificates would be "rolled over" and the
notes
notes
more investors took to
sidelines, as dealers let out a few securities,
which further depressed prices because of the thinness of the market.
About that time, it was reported that the insurance companies
a
stock
common
.
,
.
'
15, would be paid off in cash, prices were
quoted down with volume very light.
.4 Cautiousness increased and
common
outstanding
presently
1
iy2%
being issued in addition
are
623,432
Dec.
4
shares of
500,000
cautious
a
inactive market...
award¬
v
The
to
of
bid
a
created
oversub¬
were
.
.
banks, the largest holders of this security, will have to
the.income that will be lost
by this cash redemption.
temporary and largely technical.
Failure to penetrate recent
tops, along with the minor turn down in prices after the. elections,
Stanley group
Morgan
on
to be
common
been
commercial
.
extend maturities in order to make
up
Prices of government securities have given
ground, as the mar¬
seems to be adjusting its position to
developments that appear
ket
at $36 per share.
(no par)
Governments'9
on
acceleration of debt retirement will be
an
commodity prices'and business conditions.
on
EXTENDING MATURITIES
The elimination of the 1%%
By JOHN T. CHIPPENDALE, JR.
bank¬
publicly of¬
shares
offering
Reporter
headed
Co.
investment
500,000
stock
The
&
Stanley
of
group
Thursday, November 21, 1946
requirement of the small business
is
a
greater
availability
of
"equity" or capital funds. But as
to - the
method
by which such
funds should be raised confusion
exists.
Small businesses not in¬
frequently have been advised to
sell some portion of their owner¬
ships in order to raise equity cap¬
ital.
Proposals have been made
for-solving, the fin^pcipg problem
of small business by establishing
a private
or a governmental in¬
vestment corporation, to purchase
and
hold
ownership shares in
small business, usually with the
privilege of reselling them.
Such
proposals
appear
unten¬
The primary characteristic
business, and the one best
worth preserving, is its independ¬
ence of ownership.
The manage¬
able,
of small
ment
of
the
great corporation
usually does not care and seldom
knows who has acquired stock in
the
be
corporation, unless the block
large as to convey a con¬
so
centration of control.
case
of
sale of
the
small
ownership
But in the
business,
conveys
any
a con¬
siderable degree oi control. With¬
competition can best be
furnished
by
the
commercial
banks, in the form of cash credit.
Banks have increasingly. entered
the closely held or family corpo¬
the small business working
ration,
capital
in the intimate and personal rela¬
tionship
among
or
stockholders
between
partners
in
in
j
*tAHi 3; E
.Volume 164
Number 4544
THE COMMERCIAL & FINANCIAL CHRONICLE
unincorporated
small businesses, i the small business is ordinarily
minority share has a voice,' reliant upon one man; its proprie¬
even a
.
and
difference of opinion read¬
ily becomes dissension
a
tor, and that the longevity of that
man, and his continued
associa-
^mal1 business proprietor, Jtion
has
•*
lf
he
faith in his
wants to retain the full
that which he has
is
business,
the
control.
trading
The
for
post
lack
of
see
small
to
a
selling
assumes an
4.
iary.
If,
has been proposed,
as
private investment company
siderable
is
a
were
a
eral
For small
its
cogent
business to raise
needed
capital by forfeiting
its independent status would be
to
abolish
that
which
marily sought to
comes
it
is
A
the
Postwar
such
of
purposes
well as working capital
is contemplated in a
as
purposes
unfamiliar
That
these
,
Central Guaranteeing of Term
Loans
recommen¬
dations involve
a
a departure from
long standing tradition in bank-
To
obstacles
the
above*
stated
?
credit practices is of less vital im¬
prac-
tical
diffi¬
exist.
when the risk
The
must be
in advance for
a
period of
banking
years.
likely
has
of
business.
this
In
terms
of
war
pro¬
through
i;he agency of the Federal Reserve
System, with
a
loss ratio of only
would
coverage
cline.
the
centers
that
numerous
ible efficiency.
depend in practice
administration
of
of
the
If
The noimal quota
aids
business
however,
has,
been lacking and the business en¬
has
vironment
too
unfavorable
been
vided they were up to standard; a
selective, small
would, remain
inade¬
quately financed; if recklessly ad¬
ministered, the fund would have
an unduly
high loss ratio and the
premium rates would rise.
The
higher loss
requirement that the lending in¬
business facilities, com¬
the operative limita¬
tions of smallness,
has been to
restrict competition, reduce ven¬
stitution retain
turing,
0.06%. i?
business
This
was
exceptional situa¬
an
tion, since the sales of
ucts
were
be
ratio
anticipated
market
prod¬
war
assured in advance pro¬
is
doubtless
under
to
peacetime
conditions, especially if
depression
should
stabilize the
access
a
To
ever,
have
an
would, how¬
important effect in
counteracting depression.
The
proposed
extend
banks.
It
is
questionable whether the usage of
any form of voluntary insurance
be
validly attacked
ground.
As
in
the
this
forms,
upon
other
widely
its
inclusion
of
risks
does
an essen¬
and
tial feature of the plan.
The
Reconstruction
financing
Finance
the revival
problems
25 %
Board
credit risks.
of each risk exposure. The
of Governors of the Fed¬
eral Reserve System, the writers
of
the
Report,
and the Small Business
Advisory
Committee of the Department ol:
Commerce
.
and
for
a
greater
equalization of the differentials in
cases
the
financial
and
tal credits
primary
capital
banks
sector
form
can
economic work, but also because
of the need of preserving an area
adequate
as¬
sumption of ventures and exten¬
sion of, the existing margins of
commercial credit to
borrow¬
new
a
wide
To
accomplish the main pur¬
pose of the plan, the coverage of
retaining
venture
risk
must
the
'
■1
an
be
more
in business ,and
essential
enterprise
place
in- the
in
A yet more
an
credit
:r:t,
commercial
of
other
.
.
solved
small business
through
a
their
Such
underwriting fund should
of
land,
buildings,
and
relatively limited.
;
a
half-century
offer to sell
nor a
tor to
increases
value.
and
ance
agency
of the commer¬
aid to small business.
or more
solicitation of
an
offer to hoy
any
;
of these
the
doubt
existence
of
2, The
small
life
repay¬
business
made.
also
is
a
the
statistical
a
credit
Since
the
tion
ferred to the
than
of
that
'statistics
-qualified;
..." changes
the:
must,
in
of
they
the
briefer
large.
Such
often
proprietorships
remains
/ 7
true,
Association
Term
-pp.
Lending
4-6.
■»
serve
business continues and
debts
are
assumed.
nevertheless,
of
by
It1
that
V-"
stipulated
,•
••
8 Op.
cit.,
be
#1
per
Share)
$9
per
Share
following Underwriters
may
be obtained from only such of the
legally offer these securities in
as may
compliance with, the securities laws of the respective States*:,
trans¬
at the
any
can
time.
can
be
All these
fully demonstrated
of
new.
pp.
Copies of the Prospectus
may
the
Federal
It
9-11;
Stone & Webster Securities
The First Boston
tested
Corporation
Goldman, Sachs 8C Co.
Graham, Parsons & Co.
underwriting
was
Corporation
Re¬
System under Regulation V.
plan is not
■
Price
por¬
central fund
The central credit
City Bankers!
Commercial
Banks,
(Par Value
which
Some General Considerations
Reserve
-*■
505,220 Shares Common Stock
en¬
being
are
behind
credit
were
experience
v
*
while
by the wartime loan guaranteeing
life, the. fact in many, cases being
:.that proprietors come and go,
previous
wait
demand, liquidity
features
rather than in the actual business
the
the
regained at
'
while
of
bank's
be
reflect
course,
.
to
retirement policies
samples
much
Share
per
experimentation in
necessary
flexible
small
is
guarantee
safeguard
have indicated that the life of the
business
#50
The insurance further pro¬
vides
the
the
readjustments
occur..
Various
risk.
of
prospect
of
creditor
the
market
ment in the distant future appear
essential if term funds are to flow.
Share)
cushioned by the insur¬
So likewise are unforeseen
ables
Some additional colassurance
Price
changes in the market base; the
to
as
per
are
ance.
the value in resale,
recover
(Par Value #50
The risks of changes in owner¬
ship and. of business discontinu¬
equipment is
The fixeds assets/ Mbreover,1 oftbri
have a special purpose quality,
reducing the ability of the credi-
over
November 19,1946.
39.
/
be:
established central
with Common Stock Warrants
ing agency, provides what is in
effect
the :necessary
collateral.
ply first-mortgage security in the
central
uncertain credit risks.
fund
58,860 Shares 5 % Cumulative Preferred Stock
by the guarantee¬
credit
such
the Prospectus, This is published on behalf of
only such of the undersigned as may legally offef these securities in compliance
with the securities laws of the, respective States, *
which amounts
insti-i
lending
securities* The offering is made only hy
cosigning of the note of the
a
for
behind
banking
econ¬
term
providing
set up in the
of
is
cial credit system as a permanent
Through
This advertisement is neither
and
underwriting
omy.
obviously at times be
high; in the wartime experience
working capi¬
needed.
problem
variety of detailed
of individualism
ers.
Cheaper
purposes.
tutions
numbers of small enterprises per¬
cov¬
are
busi¬
among
reliable
need
The
small business
erage may be as high as 90%, in
an
more
,
order
to permit
services
according to size.
nesses
fundamental importance to
the
economy/not xonly because large
have! /recommended
that in individual
to external funds for small
businesses,
is of
The
ones.
second
access
Summary and Conclusion
Baruch-Hancock
that
ing, for the provision of adequate
undoubtedly increase.
The banking structure should in¬
clude provision for a central un¬
derwriting of its small-business
guar¬
antee plan provides that the lend¬
non-
in taxation to aid internal financ¬
of
will
so
those
services
main approach is
financial, calling for adjustments
small
business,
the
for .the Government to
pressure
do
the
business
larger
The
private enterprise in finance,
especially
commercial
banking,
solve
units
smaller
technological, advisory, and other
facilities — together
with
an
increased
protection
against destructive/practices in
competition and in the bargaining
relationships between small units
of Venture in institutional finance.
not
*
upon
managerial
If
tion must be retained as
;
attack
readily available to the large
organizations
—
informational,
error experience in venture fi¬
nancing is obvious. What is called
that the judgment and re¬
sponsibility of the lending; institu¬
reason
of
are
as
fundamentally is
the
to
and
for
'
'
■
line
first
this situation is to make available
possible in the inter¬
est
of
a
large and diversified
"pool." This conforms to the pur¬
pose of the plan. Finally, the neces¬
sity of experimentation and trial
100% protection of credit risks is
hot proposed, primarily for' the
a
position.
The
It is of the nature of insurance
to
place
many
small
dependent and an¬
and
businesses in
financial
as
can
ex¬
protection
a
past
"institutional
the
with
cillary
cer¬
as
commercial
bined
against, recklessness; indeed the
immediate danger is in the
other direction,
namely, that of a
too great avoidance • of ^econom¬
tending to reduce
independence of judgment of
circles
share in the
a
itself
of
effect
gap" in
more
underwriting of
credits has been attacked' in
tain
in
The
ically desirable ventures.
occur.
of small busi¬
td loan funds
ness
is
posure
smallness for many years
to
the
become
of
capable
are
small-unit performance. For these
underwriting fund. This should be
iberal.
those
upon
functions
to* de¬
Their
today
production
total
functions small business has flex¬
Much would
upon
tend
in
banks, commercial
cannot
The guarantee,
to
credit,
that its ability to sup-
means
form
;
to
guaranteed
of
as numerous as ever.
place
quired extent.
relatively small amount of
a
fixed assets in ratio to its volume
■;
loans
were
tively
coverage
have
capital loans for small business
to anything approaching the.re¬
inadequate for a term loan.
Clearly, the typical small business
■
ducers
90%
a
continued rela¬
units
of long- or medium-term
source
to be
;
commercial
carried
oans
against loss. With favorable expe¬
rience, no doubt, the percentage
th£
centralization,
increasing
small
type protection behind the credit
risks of small
estimated
1. Available collateral is
(
Corporation
Act. The culminating proof of its
effectiveness occurred during the
war, when 10.3 billion dollars in
of
about
was
than half of all V
more
ing proposal emphatically applies.
Indeed,- without
ari
insurance
obstacles
culties of risk appraisal for small
business credit purposes increase
.
Finance
guaranteed
the central fund credit underwrit¬
portance than the fact that
,■
struction
Regulation V, the over-all
85%, and
.
ii^ their experience.
|pamphlet circulated by the Com¬
mission J
Reserve
under
amount
nics and flexible practices for the
term loan to a small business are
term loans should include fixed-
capital
provided with term capital*
banks interested in small business
are
themselves relatively small.
They must safeguard their liquid¬
ity; their individual credit capac¬
ities are limited, and in many
cases the requisite appraisal tech¬
of the American Bankers Associa¬
That
enterprise,
themselves to
of many unit banks and that most
Small Business Credit Commission
tion.
of
culminating
obstacle
applying to all four of these con¬
siderations, is that the commer¬
cial banking system is composec
That commercial banks should
become a source of term loaris to
small business is among the recthe
type
5. The
*
of
stable
accommodate
the
retirement if small business is to
be
Obstacles to the Term Loan
ommendations
Federal
ing institution shall retain at least
from
fluctuating business earnings and
include flexible practices of loan
sacrificed,
•
the
Sec¬
under
Act and Section 5d of the Recon¬
Foundation,
which
the
"straight-line"
standards, derived
must
business debtor's independence is
; reduced during the life of the
debt, but it is not permanently
i
of
War
Corporation in its blanket
more
to
regard the
problem
of
supplying
capital
funds to small business as a prob¬
.
13b
the
refi¬
World
ing
pri¬
lem in the field of term credit.
tion
the
of extensions and
use
Second
in the end/ Other loans were re¬
tired well ahead of time.8 Bank¬
It be¬
preserve.
necessary
be
eight-year period prior ;to the
an
Louisville
nancings, has had repeated expe¬
of
riences
10-year
loans that
dragged on for as much as 15 or
20 years, only to be retired suc¬
cessfully with interest paid in full
the private enterprise character of
the venture sector of the economy.
ones.
does not
will not
The
recapture of net profits, and lib¬
fundamental,:; endangering
are
retire¬
payment schedule in favor of va¬
rious graded payment plans, in¬
cluding sliding schedules, partial
government
These considerations
in
This
debt
time.
abandoned
agency the problems would be yet
more
the
in
Industrial
set of problems might con¬
ceivably arise.; If the equity capi¬
were
avoided.
that
retired
holding
situation from which
source
be
to
mean
a new
tal
flexibility
in interest pay¬
ments, is necessary if foreclosure
small business
a
business
ment terms, even
^
a
small
likely to be¬
delinquent at some time in
the life of a term loan, and a con¬
up to buy small business
equity shares, it would strongly
company,
of
Earnings
come
set
resemble
a
ment therefore are
subsid¬
a
or
on
likely to be highly fluctuant.
Fixed
charges for debt retire¬
therewith, the independent enter¬
become
town
of a
neighborhood is
consumers
are
investor associated
prise tends to
the
the continued pur¬
chasing power of that locality.
does not always remain silent. If
a share to a
larger busi¬
an
One that de¬
stroke.
a
dependent
he sells
to
small
y
enterprise
or
two business
lose its entire
may
upon
small
accepting a
"silent partner," experience' hav¬
ing shown that such a partner
or
the
An
one
market at
pends
unknown risk; personal consider-,
ations enter even in
ness,
to
consumers
share in his busi¬
stranger, he
which
,
time.
over
business
but to lack of
supply from small
business. If the independent
pro¬
ness
upon
business rests is difficult to fore¬
a
alone to lack of investor demand
for the less well-known
security,
a
The future of the restricted
3.
market
ownership shares thus is due not
prietor sells
with the enterprise, are fac-
tors of doubt in term credit.
1
profit of
built, and also
of the dangers of divid¬
aware
ing
SHT
Bosworth, Sulliyan 8C Company
Blyth & Co., Inc. T
Smith, Barney 8C Co.
-
1
,
-'
Glore, Forgan & Co.
White, Weld 8C Co.
Boettcher and
Company:
v
4
/
'
W
*'W
*
I
»
t
■*■;.*■■• T '/
•
>
!
,
A-!^
%
?■?■:*>? t v"♦/••:
; .*
*S
'•
.j*
^
'
•■'•
•
••-
':
:•
'
'•
'v
\*.'y '»
r
.
•..,v 'w
•_;
>>;•■>
•*:
•••tt
if'-''. -XV-
'0-i
2630
THE COMMERCIAL & FINANCIAL CHRONICLE
tion
in
of
the
Canada
Dominions
Canadian Securities
with
the
and
were
evidence
particularly
Switzerland's Wartime Economic
Internal
3y4.'s.
exceptionally dull
of
tapering off of
steady demand. Free
recent
funds
By WILLIAM McKAY
market
4's
Thursday, November 21, 1946
erratic and there
were
Policy
were
again irregular fluctuations either
(Continued from page 2604)
: O"
Despite its age-long incontestable position as the universally- side of 5%"discount. Internal
the only possible policy for small
ris aware that the Swiss Federal
accepted standard of currency values, the price of gold has invariably stocks were devoid of
particular countries. While
great powers can Council and i-its representatives
been controlled by political considerations rather than by the natural
interest and on the whole the
never fell victims to this psychosis,
influence of economic forces.
''
•
•. '.J
/
I Canadian stock markets held occasionally disregard their; un¬
dertakings
with
impunity,
the and that they had from the be¬
In 1931 Britain ignored the obvious economic consequences and steady in face of the easier tend¬
same
conduct is never forgiven ginning \a fairly clear idea of the
arbitrarily lowered the value of gold in terms of sterling; the dire ency in New York.:
; ;
i'"' ' j from a small and feeble
inevitable
course
events .: must
,
.
results
were
slow
not
their appearance.
make<S>
to
Moreover it was
————————-—
not until the
a
pound
natural
more
placed in
was
relationship with
gold that the British economy re¬
gained its equilibrium.
One
of
the
fundamental
assets
and
_
"V
of production.
Consequently in
ever-expanding
there will be
Power &
Paper
stant
is clarified caution should
exercised
in
increasing
5% First'Mortgage Bonds
if
;
Xr
$1.50 Pfd. Stock
'
"
•
'A:\-i
'
.
•
i;-/'
I 't.
* ; /• f'
'
Common Stock
Active
on
Markets
i ;
■
maintained
all the above securities
ir ///:•
<
con¬
in the direction of
pressure
brief analysis available to
Dealers, Banks and Institutions
has
had
as
result
one
of commercial
a
stimula¬
activity,
On the other hand an arbitrary
upward revaluation of a currency,
especially when the country con¬
cerned has an important stake in
world
commerce,
-has
usually
brought in its wake a period of
painful readjustment with its con¬
comitant evils of overrapid
de
flation, loss of trade, and unem¬
ployment.
It is perhaps
little early yet
impli¬
cations of Canada's hasty step in
marking down the price of gold ih
a
the terms of the Canadian dollar.
6rporatiozi ii
can
measure
fit.
Place, New York 5,N.Y
Bell System
Teletype NY 1-702-3
CANADIAN BONDS
GOVERNMENT
,
;
not be interpreted as a
for selfish national benef
Apart from the initial loss to
ini
Canada's existing gold-mining
dustry
40 Exchange
there
is
the
potentially
greater setback of the discouragement of the development of the
ments in internal bonds.
CORPORATION
the basis of
less artificial
more or
wartime
experience, in the com¬
petitive field of world commerce
the
tomorrow
situation
can
readily be reversed. On the im¬
mediately favorable side the low¬
er cost of imports can lead to- un¬
necessary
from
dependence
on
ham
& Worts Limited and
abroad
detriment
the
to
try
of
r/: '■
Time
have
late
alone
'
tell whether
will
succeed where others
can'
failed but it is still not
to
reconsider.
On
too
too
many
occasions failure to deal resolute¬
A.E.AMES& CO.
ities have hitherto shotfvn aprpper,
appreciation of the national inter¬
INCORPORATED
est even in the face-of the strong¬
est political and external influ¬
RECTOR 2-7231
NY-1-1045
Thus the recurrent rumors
ences.
of
N. Y.
Federal
The
Hiram
the
and
fend the
further change in the Canadi¬
dollar parity can provb to be
an
based, on firmer ground than mere
propaganda of interested parties.
During the past week-there
.
.....
Council
had
decided
Non-Callable
placements and
plants,
additions, re¬ during which dangerous disturb¬
improvements to ances of the labor market had al¬
•
/ i
and facilities to ready made themselves felt.
processes
meet the increased volume of pro¬
A single firm which manufac^
duction
anticipated as present
governmental restrictions on the
tures
100%
and
accrued
with
interest.
optional redemption
debentures
from
accrued interest if
or
purposes,
redeemable
are
prices -ranging
102V2%
redeemed
was
.
special, much sought-after
a
anti-aircraft
of grain are relaxed.
use
the
orders
lion
reports
that
capitulation of France,
gun,
worth
francs
Pre-War
more
than 200 mil¬
evaporated overnight.
1,
spring, -1943*
,
interest
Germany
self-contained clearing
.
granted before the Hitler regime,
as
well as on other obligations!
This
gave
from
&
which to control the whold
us
point of vantage
a
limits.
'
<•
exclusively of writers
trade
and
Dress
has
finance
on
New
■
-
"•
years
after 194Q
;
.
struggles
thus necessary,
was
accept:
Switzerland
up
the
willy-nilly,
inevitable;/ f'otf
the
alone could not hold
of
course
European
des
.tiny.
opinion only an intimate
knowledge of the Anglo"Saxon
my
f
a
false verdict of this kind.
It
was
also to be aware of the
historical fact
that Europe has
never submitted for long to a rule
by
<
Principal and interest payable in New York
CANADIAN
or
Canada
,
force
by
a
single State, and
that it had therefore to be
Let
-
Y'.'
Incorporated
Corporate
Toronto
Montreal
-
'
•
Vancouver
consider
the posi¬
■
Swit¬
/Supposing:bur country had diS- 1 -j
regarded all the rulings of inter- '
do
trade with the Axis
any
neu-
or
to
permit
any
transit--of "good's
through our territory, what would
then have happened?/:./L
If the reaction
of the
Axis had
been restricted to economic
meas¬
which is doubtful, such be¬
would
immediately haye
ures,
havior
resulted in all supplies to Switzer¬
land being stopped, whether they
were
goods from the Axis
tries
themselves
which
had
to
coun¬
only goo<js
through their
or
pass
territory.
a
tons
to
hold
out
\
1
total weight of 22 million
the five years in ques¬
v
: <
l
in
tion.)
Obviously, too, the Axis would
have blocked all Swiss exports to
non-Axis
whereas in
supplied
goods worth 210 million francs and
to Great
Anyone who knows the details weighing 13,300 - tons
of our negotiations with the Axis .Britain alone between 1940 and
proof
London, England
;
point of the Allies, and attempt: :
to understand what their impres^ r}
ing
aim
Quite apart from this, the sim¬
Street, New York 5
Winnipeg
now
was
chief
lief
Municipal
14 Wall
us
of our- country* not. through.
Swiss eyes; but from the stand-
(In reality Switzerland
able to import goods exceed¬
zerland's
ple, obvious and unwavering be¬
in the future of our country
should
have made every
Swiss
Wood, Gundy & Co.
SECURITIES
„
tion
until the counter-forces were mo¬
'
*
.
conference
table which finally led to this re¬
*
Price to yield 2.50%
the
bilized.
5% Bonds, Due April 25, 1954
/'
over /
trality and had refused, after Ihe'^f
fall of France and the closing of
■]:
the iron ring of the blockade, to
j;]
It
.
3-1874
our
national law with regard to.
necessary
*
:
sions must have been.
numbers
were
press, nas been tormed m New. powers their economic resources
■
a V,
!
Iand above air their unbending
•
But only those
representa¬
tives, often weary but never los¬
ing heart, from • close quarter's
during these difficult years can
imagine ^bow ? bitter were the
our army.
who could watch
/
ready decided in favor of the Axis?
daily
irr^
formed
heen
foreign
the
for
able
conviction that: the war was al¬
composed
organization
-
or
were
of
people
who, though good Swiss at hearty
resigned .themselves to the joyless
there
Associa¬
Writers
Trade
dark
these
In
'
to
World
j
;
'
World Trade Writers: j
Form Association
1
tion/an
exact fig-?
^ +9ur war with the Axis Stated
*r^ejn the
years.
1
stock, with^
We
sult.
shall later give
We
$30,- ures to illustrate the course taken
000,0001 debentures and the 2,896,-
.
country
almost without interruption from
of these in order to, cover in¬ yelop
oh cess,
organiza-1
new
every
materials
restrictions were able
to workr
feed Ourselves and equip and de-
Walker-Gooderham
tion, will consist of the
clear to
raw
feturns 111 kind but also having
to export a great deal to us in ex-f
i at,
and j
|
Ltd., the parent
was
Valuable
and foodstuffs entered the
on a
'
issued by the Federal Council last
December.
The success, of; our
Swiss.
j.
Worts
of our
delegates' work
Trade With Germany 1
J
exchange of goods with Germany
outstanding capitalization of and to
keep lt wlthin certaii5
Hiram
country, which made the task
■
representatives much more ^
difficult, is revealed by the alarm¬
ing reading Of the White Book
own
Axis-controlled zones.
to transport our
goods overseas and in spite of all
Upon completion of the financt
ing,
invisible and all the more dangerbus network of resistance in our
system, our partner, not only hav¬
Fof.
thei ing to meet Swiss deliveries with
Nov.
after
pressure of the Axis delegates, ah •
based
100%
1949, to
Province of British Columbia
Street, New York 5
of
From 1934 onwards our whole
trade with Germany HKad
been
,
terest and amortization on credits
before Nov.
$50,000
COMPANY
Provincial
i
current
ables and for capital
(
"
weeks
,
"
Government
the
when, as recent yevolations have
proved, strong troop contingents
stood ready for. action near our
northern: frontiers, the German
spokesman emphasized his de-
activity m the external sec-York.
TAYLOR, DEALE
WHitehall
/
The Axis Resisted
_
In
character was able to save us from
64 Wall
country at all costs.
Nevertheless,
,
a
some
&
■■
overwhelming and often arrogant
opposite using all the methods of
intimidation, it will provide^ ant
example of a will to independence
which was not less positive than
the resolution of our army to de¬
unquestionable
an
/
.
ly and realistically with the sacro- 016 shares of common
sant rate of exchange has resulted out
par value.
in economic hardship and malad¬
justment. ..The Canadian author¬
NEW YORK 5,
the
1■
.
requirements of mands with the threat that Ger-;
Sons, Inc. The deben-f her army. Shortly afterwards this many would not hesitate to let our V;
tures were priced at 100% plus ac¬
general ban was lifted, at thd country feel the full hardship of
crued interest from Nov. ;l, 1946. urgent
Re even ex-' >
"request,, it should be noted, her^ encirclement,
Proceeds from the financing will of the Allied powers,.
No such pressed the fear that Switzerland
be received by Hiram Walker &
request was made by the Axis. might be dragged into the vortex:
Sons, Inc., wholly-owned Amerit After this an industry which is of war. In spite of this, there was
can
subsidiary of Hiram Walker- really foreign to the Swiss char¬ no surrender; on the contrary; ant
Gooderham
&
Worts Ltd.,
and acter and inevitably irregular in infringement of agreements which
used in part to repay bank loans, its
nature experienced a boom came to light at the time gave our
a portion of which was incurred to
which was anything but desirable delegation a ground for withhold¬
provide funds for the redemption from.the point of view of national ing our supplies and throttling
on Nov.
15, 1946 of a $10,000,000 economy. Up to May* 1940, 85% them in a new treaty.
outstanding issue of serial deben¬ of our exports of this type of ma-f
On several occasions our coun¬
tures. The balance of the proceeds terial went to the Western powers. try took upon itself the risk of a
will be added to cash funds of the It was only after the Axis belt bad
period without any agreement
American company to be spent, completely encircled Switzerland whatever.
r
»
that the stream began to flow in
among other things, for
invest¬
That there was, alongside the
ments in inventories and receiv¬ another direction, after, a pause
open and more understandable
and accrued
supplies 1, 1965.
;
national self-sufficiency in indus¬
-
TWO WALL STREET
is
right; of neutrals..
k
Canada
CANADIAN STOCKS
that- this
Hiram Walker Debs.
new
*
MUNICIPAL
Smith, Barney Offers
The debentures will have thb
fields recently dis¬ benefit of a
sinking fund sufficient
covered/ No less apparently con¬
to retire $1,500,000 ipri n c ip a
j.
trary to the national interest is amount
of the debentures annual¬
the
sacrifice of a
10%
foreign
ly beginning May 1,) 1952. For
trading advantage. The future can
sinking fund purposes the de¬
very well show that although the
bentures will be redeemable
at
step could have been justified on
promising
of
PROVINCIAL
result.
a
..-"V.
.
tainly
.
as
■
the
Walker &
However,; in view of the Dominr
ion's large and growing vested
interest in the price of gold it cer;
Dominion Securities
suffer
commit¬ charge of infringing a treaty could
vi. not be brought against our coun¬
try at any time during the war. \
i
As far as the export of war ma¬
terial is concerned, it must be said
commodities.
to discern the ultimate full
A
to
one
■
story is written of
their,. subborn fight against an
higher price for gold in relation
tion
$2.50 Prior Pfd. Stock
an
economy
still be
./
When
An underwriting
group headed on a general ban on such exports
Currency deval¬ by Smith, Barney & Co. and Kid-f at the outbreak of war, not from
uation althohgh sometimes selfish¬ der, Peabody & Co. offered to the
considerations
of
international
ly and ruthlessly employed has ih public on Nov. 19 $30,000,000 20-f law but for
quite different rea¬
the main been more in harmony year 2%%
debentures, due Nov. sons, one of them being Switzer-»
with natural economic forces, and 1,
1966, of Hiram Walker-Gooderi land's own need for 'armaments
a
to
Company, Ltd.
world
.
inevitable and
take
period of watchful waiting national conventions by its own
until the exchange position
behavior, it is sur£ to be the first
a
of gold as a standard of values is
its comparative inelastic volume
Abitibi
power,
and if the latter invalidates inter¬
The general situation still indi¬
cates
against
featism.
the
attacks of de¬
actual
countries,
fact
Switzerland
I
/
\|
[j
Volume 164
Number 4544
,THE COMMERCIAL" & FINANCIAL CHRONICLE
1&44. Swiss exports to the U. S. A.
in the sameyears even amounted
to 644 million francs and
13,900
tons.
Switzerland "was also able
thing of more importance than of about 16 million tons, or 1.3 expressed in calories, we again al •
ways received more than we gave.
•
*
:
goods.
Ip that case there would milliard francs.
not have been a tiny percentage 1
The figures for all other States
Transit of Goods Through
of the .Swiss working for .AxisJ
pre as follows: fr fr.-_ fr.fr
frv.fr:
Germany -fr. ■'
to maintain«; substantial
•
exporta¬ 'interests* >. but fr a, majority -would '
Imports—7.5 million tons, or 4
tion to the British Dominions, arid
With regard to the. transit of
havp been exploited to the point milliard francs.
J
in the case of India this almost: of physical exhaustion.
goods through Germany, our im¬
<
Exports—0,27 million tons, or ports from Sweden may be men¬
reached the prewar value level.
Switzerland the Key to the
3.4 milliard francs. •;
: :
;
It can hardly, be supposed .that;
fr'frfrV; tioned as an example. From this
these countries at war bought: frfrfrfrfrfrfrfr
This
Continent frfrfr:;
gives
an
import
bal¬ country, with which we have cul-,
goods in which they had no real
If the enemy had finally suc¬ ance of 7.2 million tons, or 600 turally so much in common, we
obtained goods weighing 520,000
interest.
million francs. fr:;-fry +.;frfr;';'•
ceeded: in destroying the Swiss
(Alsace - Lorraine, Austria, The
Protectorate of Bohemia and Mo-
raVia, Belgium, Holland and Nor¬
way).
I will limit myself to a:
-
.
few items:
frvfr' fr'fr'V
*■
the
been?^
"reduit"
The development of
our
in its hands
land
commands
the
well furnished
in the
snow
sun
if
our
frontiers had been closed for any
length of time, and however care¬
fully
our
aged
we
supplies had been
should
soon
terial but
man¬
have had to
order
Trade Relations
And now* to the question of the
necessities becoming daily actual trade
relations.
precarious the consequences
It is possible today to give of¬
might have been disastrous. In¬
ficial figures, since the considera¬
stead of being a center of stability
Switzerland might easily have der tions which made it advisable to
veloped into a breeding ground keep trade statistics secret during
of social unrest, exposed to all
the war have now ceased to ap¬
foreign subversive influences. The
ply, though the fact should not be
military results of such conditions
concealed that the figures were
are easy to foresee. Even the most
Willing and best-led army ; can¬ always at the : disposal - of J die
not fight indefinitely without good
legations in Berne which' were in¬
equipment, sufficient nourishment terested in them. "•**"*
and continual
supplies.
This is
The total foreign trade of Swit¬
proved by the heroic but unsuc¬
for
zerland
resistance put up by the
partisans in Poland, the Balkans
cessful
Sept.
few colonial theatres of war,
is
true
that
the
war,
i.e., from
million
9.7 milliard" francs.
Exports—5.25
and!
1938
from
our.
this
number
'
,
tons,
land to feed
imports and receipts
million,
tons,
Has
ment of these
obligations, and the
in
the form
of
that
supplies and the
our
Of
ited
of life
this could
amount
on
the
total
"
100% of the original
by carriers par¬
Distributing
it
total,
Plan,
$44,565,022
turned
1931.
has
in cash and
been
credits.; (While -this;
Represents;
use;
contributed
for'
the. German-occupied
^ 's'
milliard francs.
Exports—1.98
million
tons,
f\
\ i'v;"
/
f
v t
i
r
•"
We thus
had
an
offer to sell
' 's
',
years
the
of
nearly. 15 years,*.
territories
money
....
nor a
t
1
solicitation of
;/
o?■;m
•
an
offer, to buy
made only by the prospectus•
;
JI
'
'(T,'
•
j
-
or
50,000 Shares
4.4 milliard francs.
any¬
an
import balance
&
30,000 Shares
Sixty-cent ($.60) Cumulative Convertible
Preferred Stock:"
"*
:
v
corporation
fr
(a New York Corporation) l
New|nastics Corporation
fr*': fr*
v.u?\
frfr:,
^
•
fr'fr;
:;fri': 'l'j
•
'fr.-
fr
COMMON STOCK
fr "frfrvvfrfr:
(Par Value $1 Per Share)
-
Price: $10 Per Share
;
fr; ^
.
fr.; fr;■.'••• 'frfr,-fr;;fr::..
fr'
frV '
V
fr -fr
..
vj"
fr
fr-'fr fr-
.
•
-fr "
'..'fr..-L Vfr-.frviy'fr.fr
•
.
.
H,Jfrfrv'^fr
fr
-
"Vi-.-.'./frfr:.'" ';; :-fr frfr. ■'"frfrfr'vfr'fr--
i
Copies of the prospectus may be obtained jrotn theundersigned.
-
ORIMM & CO.
Members New York Stock,
44 Wall Street, New York 5
-
E. F.
Exchange
HAnover 2-8687
frrfrfri:
November
; frfr
-fr fr
' i:. •
^ fr frfr
Gillespie & Co.
19,1946
con-V
participating carriers for the.
the
Germany,arid
the securities mentioned herein. The offering is
Imports—18 million tons, or 5.7
re¬
obtained in
we
Shis announcement is not
occupied by them:
-
$28,764,435 in
100% of the principal amount
.
frfrfr
frV
" 5.'frfrfr. ■ v frfr fr fr
fr;fr;fr fr:; fr fr; frfrfrfrfrfrifrfr ■';fr fr"'?
fr
.
this
Of
tributed, it allows nothing to the.
under review, from
deliveries, and if the two be
or
'
.
distributed td
amount
ticipating in the Marshalling and
obtain the'iiecessities
.
was f
cred- I
the carriers' indebtedness
iund contributed
in
was
be of interest to know
may
what5
bermaintained,
always related to the German
saw to
$359,170
corporation. This, brought
$73,329,458
despite all the difficulties
supply?
It
in
coal
this
the
to
country was able to pull
t&ough and
annually due to us
•
-
a
paid in cash and $1,652
transport
administration, who
of
as.
engaged
.
crafts,
and
had to be covered by the so-called
far
million
industry,
the corporation re-
liquidating distri¬
bution of one-half of one per cent '
of the fund as of;Oct. 31, 1946,
amounting to $360,822;
;:
;
;
national defense in the
remaining
trade,
between Germany's payments
whole sums
that
cently made
v
deficit' represented by the differ¬
ence
Body
Repaid 100%
E. G. Buckland, President of the
Credit Corporation, an¬
army,. in
factories and in the
building of fortifications, and the
could not agree- to the non-fulfil¬
v
Railroad
oc¬
Even during the war, Switzerland
on
trade with Ger¬
Rail Credit
the
dreds of thousands who were
Germany exceeded our re¬
our
to it in return. Not even the coun-
people, the hun¬
cupied
so
or
on
.
try which up to the summer of
1941 was Germany's greatest trade :
partner managed to do this.
'comparison with
our
•
1882
———
systematically upon the
principle o£ "do^ ut des;" and" we
answered every delay in delivery^
by cutting down j our own return
supplies. It would' be difficult to
name
any other country which,'
although exposed; to overwhelm¬
ing pressure, succeeded as we did
in
obtaining considerably more
from Germany than was supplied'
nounces
turns by over 1.2 milliard francs.
or
'
in
Swiss working
the 500,000
.3'6J8
—
We based
population. |What significance has
li¬
From 1933
■
411.1
—
many
sents more than 1% of the whole
traffic
,
J
),
Liquid fuels—20.9
This figure hardly repre¬
many.
•
8.3
Chemicals
'
•
.
'
804.2
their satellites and \ the territories
tories, transport equipment and
the like, must be left to conjec¬
ture. There is no doubt, however,
that the enemy would have taken
an immense booty and would have
applied his method of deporting
able-bodied workers here as else¬
which is if
tourist
The export of electric energy,
territory had to be evacuated/ Up 7.8 milliard francs.
to what point these plans would
Of this total the following fig¬
have been realized, in view of the
ures apply to; the Axis powers,
abundance of valuable stores, fac¬
a measure
annuities,
and transit ■ services;
to
large
was
the]
where,
accounts
clearing credits.
till April 30, 1945,
1939
Imports—25.5
taken all steps to ensure the de¬
struction of objectives vital to
enemy in case war broke out
during the
1,
amounted to:
had
army
;
•
payments were necessary
censes,
.It
by them.■
1
interest and amortization,
vital
.
*•"
*
——
a
to: balance
annual
more
a
'*
Zinc
con-!
Axis countries and territories
fabricated"; articles, or* in r other trolled
words goods requiring little ma¬
.
give up the attempt to meet the
requirements of the army. " At the
same
time acute unemployment
would have presented itself, and
with the supply of foodstuffs and
and
68.7
34.4
Hides and leather-.-—
43.0
Textiles———84.7
Kaolin33.2
,
with stocks of all kinds at the out¬
break of war, these would have
melted like
Sugar—————
1944.
and
17.6
Potassium salts—
What are the facts about the
great deal of highly
qualified precision - work. ■ This work done by Switzerland, for
explains their a^eragt- valuek per Gerfnhny?-•■frfr,.frfrfrfr frfrfr fry
'
kilogram of Fr. 12.59,: as opposed j We. had between 2.2 and 2.5,
to a kilogram value of only Fr. million persons in employment in.
222 for exports to the Axis, en this
country during the war, in-!
which obviously a much smaller
eluding fr. mobilized soldiers, v To
percentage of work was done. frfrfr" Germany alone we exported goods
f In actual fact, Switzerland sup¬ to the Value of 2,500 million francs
plied large quantities of iron ore in the five years and eight months
between Sept. 1, 1939 and April
to Germany, which was then re¬
turned to us in the more valuable 30, 1945, an average therefore of
arid invisible threads which caipe form of iron and' steel.'
approximately 443 million francs
.
together fr in
Switzerland
were
It may now be asked why, in per year, while in the same pe¬
riod we imported to the value of
legion, ; and it was these which
spite pf ]the. passive nature of. our
preserved the contact between the trade
with Germany, it was still about 529 million francs per year.
In order to produce an annual ex¬
oppressed peoples and which pre¬
necessary to grant this country
vented the hope in a better future
port value of 443 million francs
clearing- credits- which 'rose suc¬
from ever being -completely ex¬
40,000 to 60,000 workers are re¬
cessively to more than 800 million
tinguished.
W
? ' ;
francs.
The explanation of thisn quired,, according to the type of
The great value of this center which is hinted at
above, lies in goods..//With a total of over 2
cf
intellectual frand
moral
re¬ the fact that our trade with Ger¬ million Swiss in employment, it is
clear that only 2 or at most 3%
sistance has repeatedly won full
many, had perforce been passive
recognition from the Allies, : ;fr; - for a number of years, since in of these were working for Ger¬
ports had not come in. Although
in comparison with other coun¬
very
1940
between
12.7 *
^
,.vr—
These figures include particularly
important steel and iron products
Required for our national defense. Coal
During the war years we imported Glass
Iron
more than 10,000 horses from
lhe(
,
we were
'
ably greater' both in weight *md
value. The low weight of our ex¬
ports to non^Axis - cpuntries in
proportion to their value shows
j;hal they wpre in general highly
Was
was at that time not yet
whole Continent?
begun.
For this purpose we re¬
There is no. need to. speak here
quired huge- quantities of cement,
iron, :;steel and * explosives,, all of the humanitarian activity made
our - neutral
things which we had to import di¬ possible only by
rectly or indirectly (there can be status, but it may" be pointed out*
that the very- existence of a free
no cement-without coal). It would
Switzerland
at ; the
have been impossible to equip the democratic
army with modern weapons and heart of a Europe under totally
rule, > arid especially - her
to
clothe and : arm
the * newly tarian
raised troops (we had at times press and radio services, were im¬
800,009 persons in uniform, which mensely important factors in the
is half " our male population be-, maintenance of the spirit of re¬
tween "15 and 65 years of age and. sistance
among
the subjugated
a" fifth of all Swiss) if
regular im¬ peoples of Europe. 5 The visible
tries
-
francs
resistance
tegic position
transformed.
1940 onwards, -what would
military consequences have
Millions)
——
would have been
it not Field
Marshal ftadetzky who declared
that the power which has Switzer¬
If the frontiers of Switzerland
had been hermetically sealed from
.'"Francs (in
Seed potatoes—————
million
at, 440
yi;:
Malt
The import balance of 'our trade
with the Axis was thus consider¬
powers of
c
May,
valued
and
tons
■
Product—
and had set
foot in the Alps, the whole stra¬
Needed Imports
"
*
r
<"
Seedgrain—-——fr-i.fr 5.8
•
■
,
:fr''1
fr
fr;
Childs, Jeffries & Thorndike, Inc.
J,
2632
[THE COMMERCIAL & FINANCIAL CHRONICLE
The
Challenge to Leadership
:•
'
salesman
always
on
doesn't
to
appear
the go, yet the first
be
has
one
working
hard, another
is
income from his business
an
(Continued from page 2602)
or
By JOHN DUTTON
little effort
as
possible, and has systematized his work. The
second fellow expends a lot of WASTED
energy, thrashes around in
every direction at once, makes a
it comes to results.
big noise and doesn't get far when
■
The old
is
the
;■■■■'■■
.
saying PLAN YOUR WORK AND
WORK YOUR PLAN
The salesman who knows how to think out
action and then follows it
through, has the
answer.
going through each month's work with a
will follow the effort
expended.
works
as
the spirit
moves
plan and who is
no
him, oftentimes hits
achieves exceptional results for
opportunist, and
streak of luck and
while; but these
a
ception not the rule.
Where Is Leadership
the
cases are
ex¬
*
To be specific, here are some illustrations of sound
planning and
good execution, as well as the opposite sort of procedure. Salesman
A doesn't make ten
icalls a day every day
there
Now
that
the
dollar
bills,
A
in his
A
man
able
healthy,
little
American
well-
unconquerably hopeful—more
by the hope of ricn re¬
wards than repelled by the greater
not
attracted
money income may be in dollars
and cents or any other medium of
doubt
•
we
to
owe
to
be
served.
But
it
becomes
and
we
just
it to
yin the week. He works
consistently when he has something constructive to accomplish, BUT
where that leadership is going to
SOMETIMES
come
HE
DOESN'T
MAKE
MORE
THAN
A
FEW
TELE¬
PHONE CALLS IN A DAY, OR TAKES SOME FRIEND TO LUNCH.
The rest of the time he is THINKING.
He has
smaller number of
a
accounts than most other
salesmen, BUT THEY ARE MUCH LARGER
THAN AVERAGE, AND HE IS MUCH CLOSER TO THEM BOTH IN
A
SOCIAL
AND
BUSINESS
EXISTS
WHICH
BETWEEN
CUSTOMERS.
in
speculation
WAY,
THAN
OTHER
RELATIONSHIP
THE
SALESMEN
AND
f THEIR
He
knows a great deal about each account on his
books. He knows who buys for income and those who are interested
taking
tomers
a
on a
in
once
block of securities it
while. When he sells these
a
cus¬
something — his earnings are
counts, and he reaps large
rewards oecause he is doing the following necessary things which
lead to success. (l).He prospects among
people who can invest in
substantial amounts
he doesn't waste time on the very small
buyer/ (2) He develops a solid relationship with each client. He
creates a friendly atmosphere, which has as its foundation an under¬
standing between the customer and himself so that BOTH know
the larger objectives which the client is seeking regarding his invest¬
ment affairs. (3) He spends much of his time creating contacts among
people who can develop into new customers, or who will lead him
to others. (4) He studies the needs of every customer and he "knows
high. With
this
salesman
move
—
his
securities.
He
spends
time
considerable
in
reading and
study
because he knows that such time is not wasted but will lead to
productive
sell
a
accounts
and
increased
business.
more
(5); He doesn't try to
security until he knows why his customer should
then he hits the target.
it and
own
He doesn't waste his efforts shooting at clay
:
.
Salesman B makes calls
hour talking with
an
who couldn't
someone
to .make him lunch money.
same
uptil his shoes get thin. He will sit for
buy enough securities
He will call back again and again
unproductive prospects,
and
that is if you want
because he is patient
one
and hard working
exceUent producer
an
learn
to
organize his work.
through but he
much
can
make this
The law
It is not
so
They are profes¬
sionally trained to organize the
discontents and troubles of con¬
all of
Perhaps because I am a busi¬
nessman, this challenge to leader¬
ship seems to me to be a challenge
of
-
industrial
and
man¬
production.
in
agers
veloped
this
who de¬
constitutional
country
under
our
from of government.
They are the
product of the great force which
than
Added to these problems was the
icans, fired by opportunity and the
desire
chance
creased
better
to
themselves
and
their
tion
Competition.
to the pressing problems of
times, and we had better start
our
think
to
now
challenge
straight about
we must
1 Let's begin by taking
of
business
management.
the
meet.
■
industrial
:
The role of management always
calls for two qualities above every¬
thing else.
be
For
realistic.
practical
He
be
must
add up. j®
y
But something
\;yy:.-y:
else is
He must be
He
must
be
/:>•. >,
equally
a
of
man
be
I
would
made
like here
to
to
see
take
his
the
that
could
and
more
have
them,
accomplished the miracle of our
high standard of living, but also
created the biggest pool of Man¬
agement talent the world has ever
half of its job
well—the
hard-
a time when great risks
carefully calculated as pos¬
throw in
t f/ ®
y y..... '
'■/
y,'
.
^
.
Company
•
.«,
'
®
;;'• ',y
time
the
Ford
Motor
told
its employees the
without a wage in--
all levels which
gamble, and we are going to take
bly be
totalitarian-bureaucracy
type
of
nation—where freedom to manage
is the privilege of a few "infalli¬
ble" minds at the top
a
of the
pyra¬
nation needs if
it."
it is to be great.
to
cratic
the
adopt
inefficiencies
bureau¬
gross
that
are
Here
the
are
reasons
the Com¬
gave for taking this finan¬
cial risk—and they are good, prac¬
pany
tical business
the
1. "We
well.
a
reasons
competition:
in
a
system
.
has
60%
of
our
-1
which
freedom
all
of
have—
us
to
on
experiment and
learn through our own mistakes
in business just as a man can ex¬
periment and learn in the field of
chemistry,
of
all
all
the
the
telephones,
railroads
of
the
world, and 80% of all the automo¬
Why is that we in this coun¬
produee 70% of the world's
oil, 60% of wheat and cotton, 50%
of the copper and pig iron and
40%*pf tfye (joal and lead? Why is
Request
our
science.
physics
What
the
or
any
scientist
Herrick,Waddell
Co., Inc.
&
STREET. NEW YORK 5. N. Y.
-
can
keep
greatest asset today is still that
freedom
rc';Z
stay in production and;
employed," said the
Ford Motor Company.
'
'U
2. "In prompt all-out production,
u
we can sharpen our production
skills and efficiency to meet and
beat competition."
; :
The truth of the matter is that
men
'
■
3.
"We may
jam
other
of
help to break the log¬
mass produc¬
was
then pretty;
postwar
tion"—which
calls
much at a standstill.
enter¬
■
,;'v 4. "By bringing the supply of newj
cars up to demand, we can da
And the surest way to stop the
it that we in this country are able
our share in halting- inflation.',®
to afford 42% of the radios of the
progress
of our nation toward
world and 54% of al lthe refriger-.
Now all of those reasons can be:
ever-higher standards of living is
to limit the freedom of individual
ators? Why is it that we in this
added up to this: The Ford Motor
country enjoy a standard of living action, making it impossible for Company gambled millions of dol¬
higher than any known anywhere men to experiment freely in the lars because it hoped in so doing;
else in the world? :
world of business and industry.
>' v
to get in there ahead of competi-;
tion with the best production team,
in
the
industry — a
production
team that could do its part to pull
the Company out of any financial,
Interested in Buying Block Offerings
hole the Company was forced to
get itself into.
,
experiment,
prise.
an
we
call
an
,
■
LIBERTY
Amer-J
®.r
crease,
all kinds wherever it is found.
so
a
and
mid—that it does not provide the
hard but rewarding experience at
important point
an
of free
35%
yy/
f
55
^
up
it said, there would proba¬
an operating loss of about
$35,000,000 during 1946. This was
the best guess possible under the
circumstances. If a wage increase
was granted, it would mean a loss
of an additional $35,000,000. "But,'*
said the company, "we have no,
alternative but to take this great
This is such
that I would like to emphasize it.
It is the prime weakness of the
biles?
j
A. DePinna Co.
*Prospectus
unless
give
But
Ford Policy®®;/®®®;®
Even
inevitable fruits of Collectivism of
with only 6% of the world's land
area
and only 6% of its people,
*Oberman & Co.
i
to
■
*Hytron Radio & Electronics Corp.
■
taken
was
the sponge.
® V®
that
At
truth.
try
,•
be
to
leans do tiot "give up.",,
seen.
shorter
to
was
sible—had
more
people
they not only
and
doing
budgets
manufacturer
has
been
family
products at lower and lower costs
Instead, it induces people to give
up
the source of their strength
magnif iciently
It
•
—as
a
What he does must
man.
important.
the manager
one,
call
Producing goods and
services, with the ever-present
goal of making better and better
so
trial bal¬
a
and
we
position that business and indus¬
trial management in this country
%
in¬
working hours.
must
*Denman Tire & Rubber Co.
:
for
earners
to help: them adjust
pay
their families, joined in a national
Why is it that the United States,
:
'wage
of
headed half—and that it has been
V-Vfe
Large
human freedom. Millions of Amer¬
doing the other half not
RIFLE.•;.;
before.
ever
losses for 1946 seemed inevitable.
"popularity contest" which
others
business, but how WELL YOU CAN AIM YOUR
could be had at all—were costing
more
distinguishes our nation from vir¬
tually all others—the scope of our
ing to have to provide the solu¬
goal and share his eager desire to
get there.
•"
? Y®' " | v®-®'v.
much the amount of physical effort that you expend
airplanes, tanks and guns.;
assembly lines had to
be put back into shape. Restricted
profits under war contracts had,;
already been committed to im-;
provements and expansion.
Ma-r
terials and supplies—when they
Automobile
In my opinion, business
and industrial management is go¬
place.
-
but
are millions of compe¬
tent business and industrial man¬
agement.
will pull him
averages
•
American
Fruit
Growers
Inc., Com.
Arden Farms Co., Pfd. & Com.
Fullerton
Oil Co.,
of Securities for Retail
Com.
i
;
And the Company
into
Distribution
Wagenseller
,
SO.
SPRING ST.
TRINITY 57*1
DENAULT
Teletype: LA 6t
oe
hole,
as
Management
to
/lis®
LOS ANGELES 14
Qeotatlom end Informefioe
a
did get itself-
it expected to. When
told
its. employees,
last December that it would have
Inc. 8
Member» Lot Angeles Stock Exchange
*24
>
not
am
that there
,
business
owe
particular business. On the
contrary, the ' significant fact; is
who have faith in
us
human freedom, this challenge to
leadership becomes therefore a
personal challenge—one which we
cannot side-step.
,
J
to
We
any
fused people.
To
production.
conquest of theimachine
than a year ago, automobile manu¬
trying to give the cred¬ facturers faced a gigantic problem.
it lor these amazing results to For four years they had been mak¬
some small industrial
not passenger automobiles,
group or to ing,
social and po¬
own
our
mass
I
theories.
He also needs
WHAT HE NEEDS IS
—
law of averages work for him
same
of larger trades.
that counts in this
of their
ing
the
and
power
going some
He must have a goal, and
effectively if he prospects better and thinks in terms
more
power
vision.
SOMEONE TO MAKE HIM BELIEVE IN HIMSELF.
to
big lesson
to make big money you have to think in
He has the makings of
money.
the
own
litical
must
sically but he thinks timidly. He hasn't learned the
terms of big
on
small accounts. He works hard phy¬
or
women
their
largely to something
mass
our ability to organize
such as we have had since the end
ourselves and to manage the elab¬ 'of the war,. / 0®®-®/®,;
®
orate social organization which we ® Let me give you an example.
have had to create while develop¬
When peace came a little more
In times of confusion
always
irresponsible
seeking to take
advantage of the situation to fur¬
ther
call
in
improving one's future
competitive position
is present
every day in hundreds of thou¬
sands of American business trans-*
actions—even in time of confusion
and also to
are
and
men
ance
"
pigeons.
there. f
means
every
from.
it very
owe
very
you and to me
to the future of our country,
would
place.
the hope of
*
important to
take
This willingness to take risks
capacity
produce goods and services in
large volume and at low cost. We
eventually get the leadership they
are
hoping for. The people will
and industrial progress
never
national
our
heavy losses—busi¬
of
likelihood
ness
T
This standard of living of ours
will
people
supported at a great many points
by nothing more than rank Opti¬
mism.
If the human mind were
dressed children, has a high stand¬
ard of living, no matter what his
Coming
Profit System is
so-called
Our
a mud
low standard of living.
with a healthy, comfort¬
and
in many ways a
great, and even cruel, joke. It is
at best a Profit and'Loss System.
a
home
country..!, To call it a
this
in
tem
Profit System is
pocket, but living in
hut has
sometimes call the Profit Sys¬
we
with lots of money
man
Business Experimentation
of
tem
pocket¬
a
System
Loss
What I have described as a sys¬
a
pesos,
exchange.
be
can
of
costs.
From?
,
knows,
and
Profit
A
Living
us
pounds
rubles, but vast quantities-of
goods and services available to
large numbers of people at low
all
among
solve the problems of
peace.
The American people, in
short, seem to be confused and
waiting for leadership. The whole
Situation can perhaps best be de¬
scribed
as
"The
Challenge
to
Leadership."
an
a
least
of
of
or
to
groups
advantage of methodically
knowledge that maximum
The man who trys to do
results
everything at Once, who has
plan of
a
the
done
Standard
everyone
standard of living is not
ful
cent of the American public,
fact, think that business leaders
have
as
As
per
in
wastes
j
problems, that vote of confidence
is not an overwhelming one. Nine
and
considerably larger than the second. The first salesman is calm
easy going, he calls his shots, thinks about what he is
doing,
The
Congress to solve reconversion
that is
•Thursday, November 21, 1946
8
lose,
000 in
CO.
Telephone
Russ Building, San
Exbrook
7484
Francisco 4
ters
,
Teletype SF
1946, it wasn't fooling.
Actually the Ford Motor Com¬
pany
\
all CaKforait
after the proposed wage
increases, something like $65,000,-,
272
during the first thee quar¬
this year lost $51,600,000*
of
despite two price increases granted
the company, one in March and
iVolume 164
Number 4544
one
in May.
There was a third
price increase late in September
which had little effect on these
ings,
amounting
their net worth.
on
sistently, the higher
you go in size,- the
loss of $51,600,000
possible tax rebates,
before
after Taxes,
11.8%
results.;; This
was
COMMERCIAL Sc FINANCIAL CHRONICLE
THE
earnings.
The
big
to
Con¬
the scale
smaller the
companies—
up
because the amount of tax carry
back cannot be determined accu¬
those with total assets of $50,000,-
rately until the results of the full
year's operations are known. Had
this
loss
represented
the
full
4.7%
ing only corporations which had
year's
net
operating results,
carry back would have
such loss to $32,900,000.
the
000
tax
..•••/v--.:
before
we
engi¬
do
can
a
But
keenly
for that
those
competitive
system.
employees,'that faith will be jus¬
tistics.
tified.
for
This
and
interested
me
for
mation.
recently,
and
statistical
some
I
infor¬
What
percentage of pri¬
enterprises succeed—that is
to say, make profits more often
and to a greater extent than
they
losses,
and
thus manage
to
survive for
a considerable
period?
"What is the average profit of cor¬
porations?
Here
I got:
In
are
of
some
the
answers
v
...
only 4 of the 15
years
preced¬
income
than
reporting a net
defic't. During those 15 years 58%
of corporate profit and loss state¬
ments were not profit statements
at all, but loss statements.
V
In Dun's Review for'June 1946,
an
article
What
the
are
on
"Business Success—
the Odds?" reports that
fatality of business
concerns
in this country approximates 12%
to 15%
This calcula¬
per annum.
tion is confirmed by U. S.
Depart¬
ment of Commerce data. A fatality
nection
with
enterprises
the
have
that
Credit
Due
exaggerated
notion of how much money com¬
even more, as a
regular thing.
.It is probably for this reason that
many workers believe that vast
increases in payroll can be taken
out
of profits without the neces¬
sity of any increase in prices.
The fact of the matter is that in
1917 net income, after
taxes, for
all
corporations in this country
was
9.4%.
In 1943, when some
people supposed American indus¬
try was making huge profits, the
profit margin of all corporations
in this country was 4.8%
half what it
was
in
or
1917.
about
In the
15
years from 1925 to 1940, all
manufacturingL corporations com¬
bined, earned only 3.3%on their
invested capital, and only 3.2% on
their gross income.: In only one
single
riod
on
was
during that entire pe¬
profits greater than 6%
capital investment and that
6.6%.
was
year
were
in
1929
In
when
that
the
same
rate
year,
was
profit
5.5% of gross income.
It is
American
also
generally assumed, I
think, that Big Companies make
Big Profits. All the statistics show
that this is not true. It is the small
ganized
uncertainties
are
the
of
and
labor
economic
thing—it
unions
and
the excite¬
their
in
of
the
venture
is
the
gets big,
leadership
lost.
Men
simply
They
for
them.
It
and
becomes
we
of earning a living.
that sense of fulfill¬
ment which
men
and
women
than there
4.
;
in
their
need
managements
this
key
a
.
tial
Bigness Creates Unsolved V
Leadership
.
v
:
I think the record is clear and
that business and industrial lead¬
ership, and I
at
management
assistant-
mean
levels—from
all
to
the
the
president—is
en¬
titled to great credit for magnifi¬
cent achievements.
It is entitled
to much
tricate
The
more.
vast and
organization which
in¬
it has
been necessary to create in order
to
support
production and
mass distribution, has required a
huge educational program and the
development of a technical force
mass
in this country which is the mar¬
vel of the modern world. We have
asset in our
an
engineers, tool de¬
do
not
versal.
say
that
this
is
On the
contrary, there are
where leadership
has been equal to the task created
by Bigness. But the fact remains
that Bigness created a problem,
many
and
instances
The
is
it is
which business
one
industrial -management
yet fully solved.
solved
if
enjoy
are
we
the
share.
business
and
has
not
of
of
mass
is
top
a
our
to
an
The
the
planes, tanks, guns
agement is
materials from
suggests
a
a
Feb.
Reserve
Federal
.
Total applied for
Total
It
glass door marked "Pri¬
lent
tors,
salesmen
and
technicians
generally, which no other nation
It suggests a program and a pur¬
mately 0.376%
pose.
the
team.
work is
followers.
can
match.
I
But how let's turn to the second
lies
equation—the field of
1.
-,
,
think
that
there.
We
'
,
,
real
our
read
in
problem
the
28th
f Consider for
a
moment what has
happened in this country since the
turn of the century.
Production has been vastly in¬
creased.
vidual
The wealth of
has
the
indi¬
primary- needs of men-ata purpose which they con¬
sider worthy of their best efforts.
Studies of wage earners indicate
that they want to be treated like
human beings. Are we to marvel
at this discovery? They want con¬
sideration.
Is that strange?
Far
from it.
a
It suggests
What
a
word sug¬
captain and a
is more, it suggests
a
One trouble with
toward
Range
among its workers.
3. If
government
is
of accepted competitive
'
■
Too
follow¬
ers
'
going
to
m
70%
of
the Tow
the
amount bid
Big
the. nationi
9.574
\
Business
might today be
considered
only a" middle sized
business. In 1914, the 3,819 manu¬
facturing establishments doing a
million-dollar business, did 48.6%
of the manufacturing business of
in
Tn >1939
this
class
there
were
and
they did
67.4% of the manufacturing busi¬
ness—more
in
number, and
a
is
'
NEW
maturity of a sim¬
ilar issue of bills on Nov. 21 in the
amount of
There
neither hn offer to sell, nor a solicitation of offers to buy,
The offering is made only by theProspectus*
ISSUE
price
was
was
accepted.
a
$1,308,357,000.
60,000 Shares
Oxford Radio
Corporation
Manufacturers of Loud Speakers and Associated Acoustical Reproduction Equipment
'
(■:
To achieve the goal of more goods
and services at lower costs, we
have
a
hundred
Mass Production and
Now, this is
very
•
(Par Value $1.00 Per Share)
thousand
Price $5 Per Share
more.
Bigness
far from the
bad thing that some people would
like to make it seem. The simple
truth is that
V *
Common Stock
have turned to larger-and-largerscale operations. Single organiza¬
tions
any^ofthese securities.
'."v
smaller share of the total for each.
employees and sometimes
cannot have
production without bigness.
bigness is always relative.
Copies of the Prospectus
may
be obtained from the undersigned and other registered dealers as may
legally offer these securities in this State.
mass
And
You
we
the total production in their
than they were a quarter a
field,
tury ago.
com^
Furthermore, "big
cen¬
FLOYD
T.'.
•
•
'
•
i-
D. CERF COMPANY
incorporated
•
'j
■.
^
120 South La Salle Street, Chicago
November 20. 1046
;
for at
people at all levels in government.
,have the
problem of bringing into focus in
great organizations, that competi¬
This announcement
\
'
have an important role in this
country, it is up to businessmen to
spend more time working with
business and in¬
management
.
0.376%
approximately
per annum.
>jl
tremendously.
And enterprises have grown larg¬
er as
mass
production and mass
a
".V'.
Low, 99,905;. equivalent rate <«*£
discount
grown
distribution have expanded. What
once would have been considered
approxi¬
per annum.
High, 99.907, equivalent rate
discount
approximately
0.363%
per annum.
"V.
great goals.
no
$1,826,794,000.
discount
of
rate
bids:
-
it
often, management has
on
man¬
sight of its function to lead—to
inspire—to draw men and women
after
Banks,
Average price, 99.905-f-; equiva¬
agement today is that it has lost
But both observations are
reminder that
dustrial
Leadership is
of¬
opened aft
$1,313,661,000
$33,810,000 entered on
a
fixed price basis at 99.905 and
accepted in full).
gesting enterprise, courage, vigor.
farms.
our
human
and to
(includes
beings,
of
Treasury
accepted,
whether they are wage earners or
executives will show that one of
study
tor
91-day
20, which were
factories and food from
Any
the
Nov. 15, were
on
signers, cost accountants, manu¬
facturing experts, transportation
specialists, financiers, administra¬
vate."
that
Nov. 18.
drop the
"sit-down" word.
of
18
be dated Nov. 21
to
fered
ing and substitute for it a more
dynamic word—Leadership. Man¬
and other
for
mature
word Management from our think¬
amazed
our
bills
in
the Treasury
$1,300,000,000
Nov.
on
thereabout
.;;v
I suggest next that we
new
Secretary of
tenders
understand
Hat-ism.
we face
Enterprise
needs whidh
Free
growth. What is needed
modernizing—and the men
announced
ability
"officer caste"
the
Result of Treasury
Bill Offering
to
manage¬
to the
organizations, we
mass 'leadership.
,
industry. We can't have Brass
at the flow of
war
eye
mass
distribution,
mass
problem which
make
some
suggesting that
develop our
men
have
cannot
During the war, regardless of
his job or the size of the business,
everyone had a common objective.
was
an
real
to
must
industrial
challenge of
who, for my money, can do the
best job of modernizing it are the
men who helped to build it in the
first place. And the American peo¬
ple expect us to do it.
the men who are to
work under their leadership. We
free economy..
The rest of the world
interests
the
meet
nificent
of
men
thoroughly
pro¬
duction and mass distribution in
our
am
we
and
ments with
And it must be
to continue to
benefits
But I
in the future
df
all
than by saying—
System fit the
burdened with
have
not
may
summarize
cannot
have been created by its own mag¬
part of
who
I
Vision—of
through mass
mustdevelop
agers may
uni¬
levels
all
*
let's
of
better
To
any project the man¬
design and plan. I am
not suggesting any kind of frat¬
ernizing
program
that
would
bring together any groups of men
v
Problems
I
a
so
at
businessmen.
production and
industrial
today..-The
people
were
Finally,
think
1. There is too much isolation
and
non-
more
•
as
business
far
were
importance
should have in mind:
our *
to
remember the
having
goals—of making our great and
interesting
objectives
clear.
T
take
better
*
there
government
business and
industrial management picks
up
the modern challenge to leader¬
ship, these are some of the things
a way
lose
an
often
of
-
contribution
a
businessmen with ideas talking to
in the pro¬
see
purposes
,
Perhaps/then,
which
direction
and
of
That, in my opinion, is
and a significant Tact.
become part of a working
has no meaning or
women
force
with
vision
things which they
do and how it is
an
the
that
social
a
of
comfort
struggle. They know
enterprise is trying to
contact
simply
is
proud
who
unions.
When
not
a
Or¬
are
grams i
that
is
to
was
cause.
women
what
doing.
enterprise
new
new
Men and
ment of the
the
a
a
make
to
this
country, during the past dozen
years, has tried many costly ideas
which simply couldn't work, as
But
earner.
thing.
women
work for it can share
wage
evident,
everywhere
men
the
the
*
corporations which show the big
will find that many of the greatlygest profits, as measured either by enlarged enterprises of today are
return on sales or capital.
Take actually smaller in relation to the
corporations which in 1939, just total production.of the nation, or
prior to the war, showed a profit. Of
these, corporations with total as¬
sets under $50,000 showed earn¬
and
venture
and
The
policies of the undertak¬
Business
con¬
panies make. Studies indicate that
people frequently suppose that
corporations make profits of 30%,
and
of people of this
masses
Chapter of Proverbs, "Where there
management of is no Vision, the people perish."
an
focus,
purpose,
who starts it.
for
work.
I
direct
the worker
new
oppor¬
made the
/
no
But
give
an
govern¬
opponents i&t
as
the public welfare. One reason
perhaps
have
clear. The trials and tribu¬
are
lations
nation incomparably well-off., ;
scene.
demonstrated
no
tages
What organized labor did,
more than
anything else,
it
with
work
people—not
want
tangible advan¬
other
responsibilities that they
lose touch with the thinking of the
men and women who are so essen¬
vision.
been
ing
and other
of the great advances which have
tions) is found to be characteristic
has
and
income.
annual
our
people who have
security
nomic
'
€*f
proposals, but as honest, experi¬
enced, well-informed citizens who
eco¬
enterprise is small, all
or woman
aims and
great deal to achieve
a
management are
half of
It
social
done
tunity to become infected by the
enthusiasm and purpose of the
man
Organized labor stepped
the gap. Organized labor has
into
con¬
a
the" maintenance
constructive
ment
people.
There is where
I want to make
to
our
competitive Profit and Loss
System, I suggest each of us gxve
5% of his time during the next
12
months to hard,
intelligent,
In the transition from smaller
business to bigger business, indus¬
trial management lost touch with
for
an
work
tribution
fully
are
the work they are doing.
On
the contrary, they begin to find
their real life
outside of
their
of 400,000 to 500,000 enterprises of
all
types; (not simply corpora¬
of the American
no
enterpriser
who
If you and
known, understood, and respected.
no
; ,>/■■■■■
objectives
in
foreman
ing World War II were there more
"active corporations" reporting a
net
free
enterprise, his optimism,
his competition, have come most
vate
take
reading of business sta¬
There is
the
When
make
can
from his
'
subject of profit and loss
asked
year, we find
total assets of
for
guaranteed
Declining;
Profits'
that
say
the
when
lias happened—and there's where
cor¬
tent of the risk will be apparent
from any
•
with
article
And with the co-operation, of our
Business Losses
consider all
we
less, sell it for
less, make it better, and gain the
rewards of public service. The ex¬
have faith in the future of
America and in the opportunities
a
to
challenge lies.
some
pany
in
is not
our
If
to discover whether he
at the Ford Motor Com¬
we
that
problem lies.
year.
The Profit and Loss System is,
by its very nature, experimental,
and, therefore, uncertain. The free
enterpriser, big or small, sets out
stabil¬
more
that
but they do not have large profits.
great many things that we would
like to do—things like retirement
plans and plans for
ized employment.
in
$50,000,000 or more showed a net
profit of only 3.1% on their net
worth—and 1939 was a good year.
These supposedly prosperous Big
Companies may have more stabil¬
ity and may earn more steadily,
neering facilities. And, of course,
going to have to earn back
losses
But
market
of supplying
our
that
we are
these
the
are
I have
porations
postpone the expenditure of $50,000,000 that we would like to in¬
research and
income
had losses.
Of course, we have had to
added
organiza¬
places for
organiza¬
tions which, in turn, depend upon
suppliers of their own.
their net worth.
on
Mass production
omy.
tions
thousands
not taken into account those which
reduced
Of course, we have had to defer
vest in
earned, after taxes,
more,
urge—that sense' of a goal
achieving—that belief in
objectives which can only come
"
■...
,
tive
worth
pend
Remember, I have been discuss¬ change has taken place. Something
large expend it ures for much
needed
manufacturing improve¬
ments.
or
panies" and "little companies" de¬
upon each other in our econ¬
2633
•
;
-;.VTy
.<
/;
/
,r*
2634
\
.THE COMMERCIAL & FINANCIAL CHRONICLE
Thursday, November 21, 1946
stant effort is
Trade Potentialities in Far East
(Continued from
treaties
with
China
and
business in mind.After the
can
Spanish-American
War
assumption of territorial
respon¬
cial
and
cultural
still
to
considerations
the fore in
shaping
policies toward the Far East.
Our enunciation of the
Open Door
and
our
insistence on non-dis¬
our
treatment
largely
motivated
were
by
a desire to
promote
business
and
expand
international trade relations.
our
Conditions in Far East Uninviting
Today
;
with the
return of American
we
problem of
business
trading in Korea is not now feasi¬
ble.
But the development of a
healthy
trade
relationship be¬
,
,
faced
are
a
the
to
Far
under
East
conditions
which are, to state it
uninviting.
Japan is a
defeated country whose economy
being
given to measures which
make possible limited
soon
may
traderelations
and
between
private business
Korea
..
We
concerns.
hope that American business will
take
active interest in Korea.
an
mildly,
must
perforce
Allied
control
Korea is
na¬
American
of
development of the Far Eastern tween Korea and Allied nations is
7'V;
77 :• '7y 1 our aim, and consideration is now
come.i
criminatory and most favored
tion
part
a
countries."
our
sibilities in the Pacific,
notably in
the
Philippines, political and stra¬
tegic factors gained weight but
on into the 20th
Century commer¬
were
j.
«'
and
is
strategy of peace, therefore, to
assist in the rehabilitation and
Japan
largely with Amerir; I:
*Were framed
It
distress.
2614)
page
remain
for
liberated
a
to
coun¬
try split in half at parallel 38 be¬
tween
the
and
us
In
Russians.
China internal strife seriously re¬
tards steps toward economic re¬
In the independent Philip¬
pine Republic we are faced with
covery.
The Philippines
\
Foremost
under
time
some
the
among
.
problems
the
struction.
,
The /"Rehabilitation
thorizes
Act"-
au¬
$620,000,000
for the payment of war-claims of
Secretary Byrhes gave voice to a new
situation, to which we must private property holders, for vari¬
traditional American trade policy
adjust ourselves. t ;In Indo-China ous rehabilitation and training
in the following words.4
*
and Indonesia a return to normal
projects, and for purchase of sur¬
7 "The United States has never trade conditions awaits
a solution
plus property.
In addition, Con¬
claimed the right to dictate to
of problems presented by the selfgress has
authorized a loan of
other countries how they should
governing aspirations of the peo¬ $75,000,000 to the Philippine Gov¬
manage
their own trade and ples in those countries. In Siam—
ernment to enable it 'to meet a
commerce.'
We / have
simply well, Siamese in Washington.tell
serious budgetary situation.
In his radio address last month
grant
a
r
countries, including
China, from adopting temporary
measures in the fields of
tariffs,
trade barriers, and other domestic
legislation of
type which might
a
jeopardize, the
ment of this
successful
collaboration. V
7y: 777'; 77'
military situation. The press, I
feel, has made abundantly clear
of
tional
Assembly is scheduled to
Nanking today for the
purpose of considering a constitu¬
tion and
reaching certain political
meet
in
decisions in regard to government
organization.
General
Marshall
hopes
and
counsels
do
so
the
—
make
its
trade
discriminations
relations
with
other
in
coun¬
tries."
By
1936
foreign
our
with
the
valued at close to
lars.
business
Country.
In the
trade
Far
East
or
was
billion dol-
one
20-year period from
1915-35 the Far East's share of
our
total
—will prevent the disaster of
tinued civil discord. Chinese
and the
omy
Chinese
people are
acutely from
exports increased from 5%
to 16%.
In 1936 our total direct
investments
in
,
the
Far
amounted to roughly
East
$335,000,000.
I
In
making this brief sketch, I
have in mind a recent
tendency
toward; making
an
viewpoint of
role in the
East.
our
1; unbalanced
Far
Political and
siderations,
are,
to
seem
military con¬
important as they
as
in¬
my
to
"
;V;Cv?
,
v General MacArthur has demili¬
tarized Japan but it is impossible
to occupy a dis¬
share
of
present
me
proportionate
public
that
attention.
It
is
accepted
an'ill-important objective of
policies is to provide for the
our
security of the United States
the
maintenance
but
peace,
I
of
think
and
international
also
we
have
another
objective of equal impor¬
tance: that is, to bring about in
the
relations
and
other
between
states
ourselves
mutually bene¬
ficial commercial and cultural
changes which
ternational
standing.
These
promote
welfare
-
V
.
,
will
and
in¬
under¬
'
y
,
de¬
with
tain and the amount that is
ject to removal
tions
reparations. We
hope that a de¬
as
to
reason
will
be
balance
in
know,
economy
in the
time to
same
7
on
over¬
a
gov¬
ernment-to-government basis. An
Inter-Allied v Trade
Board 7 for
Japan was recently established by
the
Far
Eastern
Commission
at
request of the United States.
Its
is to
purpose
objec¬
advise
the
on
disposition of Japanese exports
, that
we
and on sources of imports.
achieving
the kind of security we
want, or 7 Among the present obstacles to
in, maintaining the kind of peace a change-over to private trading
tives.
I
feel
strongly
cannot be successful
we
want, unless
and
active
an
leading part in international
^commercial
will
strong
will
and
cultural
further
go
element
and in the
and
in
cultural
other peoples.
^
same
viction that
fense
is
our
I
that
say
a
security,
development of
and
At the
life.
maintenance of peace,
be the
mercial
of
in
take
we
a
com¬
ties
with
i,
time, it is my con¬
strong national de¬
essential
to
the
We
must
be
equal to
the task of
encouraging and sup¬
porting democracy and progress.
There may be times and occasions
when, in the short view, it will
seem
to
advantageous to
our weight
throw
on
our
security
influence
or
the side of the
status quo; on
the side of those forces calculated
and
the
inadequacy of
transport and communications fa¬
will show that strength lies on the
side of progress.
Chicago last April the Presi¬
dent said:
"In
growth
Far East,
as
else¬
shall encourage the
and the spread of de¬
we
mocracy and
The
ever,
roots
soil
of
in
.
*
.
democracy, how¬
will not draw much
ishment
/•*
of
civil liberties
any
poverty
nation
and
nour¬
from
a
economic
have
United
of
source
a
purchases
large
our
chronic
pre-war
state
trade
of
these
in a
was
of
imbalance, our
being only
about one-tenth of our purchases.
You may recall a recent state¬
sales
in
cles
be
can
hazard
tion
the
most
years
by the Under Secretary of
State for Economic Affairs, Mr.
Clayton, to the effect that
United
the
greater
States
support
should
give
foreign
to
in¬
vestments of its nationals in stra¬
tegic minerals that are in short
supply. This statement has a spe¬
cial application to the countries
of
Southeast
Asia, and the Far
generally, as sources of sup¬
ply of a number of strategic and
East
critical materials.
^
Investment
along the lines proposed by Mr.
Clayton should have the effect of
increasing
the
importation
of
that
areas
concerned.
•
-
a
resump¬
have
we
China.
We
have
the latter half of next
year, pos¬
sibly
Most favored
private trade with Japan
some time during
sooner.
.
signed
nation
treatment is
Situation 777
porations.
In
Korea, we are now estopped
putting into operation an
over-all economic plan
by the in¬
ability of the Russians and our¬
from
selves
to
reach agreement
administration
for
unified
on
a
the
country.
and
we
We want a united Korea
want to assist the Koreans
toward
self-government
dependence.
But while
tinue
our
Joint
and
we
in¬
con¬
efforts to
bring about a
of discussions in-the
Soviet-American
Koreans
into
the
country.
and
and
more
to
more
administration
bring
directly
of
their
In
doing so, however,
we do not lose
sight of the fact
that a united self-governing Korea
is the goal we are determined to
be
gible in the relation to outgo for
imports.
Consequently
China's
current balance of payments
I
apparent to
have said it will
you
posi¬
tion has continued to deteriorate.
The exchange and foreign trade
regulations
adopted
China,
by
UNRRA's relief and rehabilitation
and
program,
surplus
sales
and
property disposals are only
temporary
palliatives.
The
tion.
:
r.
in
than
scope
States
•
existing
commercial
United
treaties
in
a
number of respects. For
Article 19 provides for
instance,
fair and
equitable treatment as regards the
application of exchange controls
and
Article
20
commitments
embodies
With
certain
regard
to
monopolies. It is designed to meet
the needs of present-day commer-*
-:
cial relations with China.
in
77V7;7v
China is expected to collaborate
the establishment of the pro¬
posed International Trade Organ¬
ization and is one of the "nuclear"
countries
which
negotiate
for
have
the
agreed
to
reduction: of
trade barriers. China will also be
urged
to
enter
into
other
tilateral
economic
having
their objectives
as
mul¬
conventions
a
pro¬
connection
worthwhile
to
why private
sultation
and
through
con¬
collaboration.
Con¬
1
what
I
misinterpretation
Marshall's mission
as
General
is
being solely
political in its objectives. Chinese
economy, is in
a vicious circle.
Marshall
of this state of
fully
aware
affairs and it has
been his purpose to encourage the
Chinese to break the vicious circle
by reaching
a
political settlement
that would result in
strife
civil
revival
cessation of
a
nlake
and
possible a
activity.
economic
of
Sooner
;v
I
r •
government
capital;7>.77
taxpayers' money.
to invest' 777
that is, for the
I believe it is unsound
public capital in
or
tries where
is
there
coun¬
wide-spread; .',7/
corruption in business and offi.
cial circles, where a government;
is wasting its substance on excessive armament, where the threat' 7'
or fact of civil war exists, where
i
tendencies
toward
government
monopolization exclude American
.
business, or where undemocratic'
concepts of government are con-;
trolling.
I 777. 7
77 7 ■ |
„
,
,
In
,
expressing 7 the
foregoing;
views, I do not of course ignorethe advantages of cooperation be¬
\
tween
government finance and
private trade or the fact that there
fields- for. the
are
investment
i,
;
of
government "capital into which it;
is
not
feasible
attractive
or
for
)
priyate capital to venture. I havesih-mind large-range and Jong-;
term projects which are basic in f
character and are fundamentally
sound from the standpoint of the.
economy of the country.
Assistant
Spruille
weeks
Secretary
Braden
*
' ;
I
of
stated
some
Chicago that "the
purpose of lending should be to
in
ago
create
net
a
increment
to
the
:
"loans should not be made if they
enable another government to ac« ;
quire
or
cient
*
>
free
displace
existing reffi-;
enterprises, whether;
they be American in ownership err *"
not."
In stressing the economic and •
trade features of our; position in.; ;
the Far East, I do not wish to <
give the impression that" I am;
overlooking other factors. In this U
complicated world In which we'
■
are living we must give full con-;
sideration to the inter-relation of»
the political, v cultural^; economic,
and
security factors in
policy. For
tive
our
there
our foreign :
policy to be effec-;
be
harmony
must
>
.
all these factors —. the •
teamwork we find- in a good 7
basketball team or a fine string'
quartet.
The
President, in establishing;
"Committee for Financing yForeign Trade," said: ".
1 am 7
the
.
.
anxious that there shall be fullest1
.
cooperation between governmental
agencies and private industry and ;
finance.
turn" of
Our
common
aim is re-'
foreign commerce and 7
investments to private channels 7
as soon as possible,"
I
our
do
not look upon
merit as,
later this must be done,
and be done by the Chinese. Mili¬
or
a
this state- !
simple enunciation
:
a recognition :
challenge to American ;
.
business.
or
General
vocated
Marshall- has: ad¬
with
such
persistency
by
the
democratic
negotiation and agree¬
settlement
method of
ment.
77 -7
v.'.' V,}-?v?'V.r r:'k7;7'-/■ 7- <*V 7
j
'\
Potentialities of Expanded Trade
'
;
|77 1 ; V'.y/
In making this brief
sketch of
current conditions in the Far East
optimism.
But I do think the potentialities
of an expanding American busi¬
with the
ness
be
exist and
Far East
about
it in the right way. This brings
me to
a
thought which I would
like to- express
and emphasize.
can
When
developed if
I
use
the
"American
term
in
business" .1- have
go
we
mind
all
-
American business irrespective oi
whether
official,
do
or
has
a
private,
can
we
standard for private
and
■
V
.-•
I
have
business
another standard for
business.
semi¬
character.
official
believe that
not
one
it
i A recent editorial in the New
York "Times" states that our gov¬
ernment should base a loan
upon
policy
the important principle "thai
are not gifts, and
that an?
a
loan musl
and
a
my
dent speaks. Please call on me if ;
I can be of help to you in meeting
the
.
;
i-V
i
1
>
\
«
>
■'
u77;7v''
»
•"1
■
•
■;j,
«*—*-<•mm
-*77^;-'.: ^ ;
: V-
Stock of New Plastic
Corp. Offered to Public
A
issue of 30,000 shares
new
of 7
60 cent cumulative convertible preferred stock (par $2.25) of New
*7
;[
,1
Plastic Corp. was publicly offered
Nov. 18 by Grimm & Co., New
7
.7/7 i-.
York, The stock was priced at 777
$9.75 per share. Proceeds will be 77
.
used to purchase new equipment,
pay
amounts due under condi- 77.77
-
tional
sales
contracts
and
effect ,vt
additions to and alterations of
isting
tools
balance
and
ex-
.
~
.
The >'
equipment.
will be used for working * 7
capital and the elimination of cer- 7 7:
existing bank obligations. 7
7 7
tain
The
company
Delaware
cessor
of
the
to
Sept.
a
was
16,
organized in
1946
as
sue-v
*.
California corporation
same
name
.
originally in- ;
corporated in May, 1940. Company 't¬
is- engaged in the development, v
and
manufacture
plastic
and
;
fabrication
'7 r
of
chemical
products. \
hand aggregate '
i' ?
•
-
1
1'
71 '■ .:!') >"•;? v" ■) t >
:!'}
f >
.
7
challenge.
furnish,
like
any
prospective Unfilled orders on
private borrower, convincing approximately $600,000.
••.'f
,
I am in Washington to y
part in carrying out the i
cooperation of which the Presi- :
do
official
7:.;>''7:'V7"• 7;
renunciation. It is
of
I cannot be accused of
i
'j
it
quarters a
of 7 General
country applying for
problems
think
some
loans
mercial
I
mention
feel has been in
motion of international trade and
com¬
,.
among
this
In
the solution of international
achieve.
From what
from exports has been negli¬
cor¬
V
The Treaty is somewhat broader
Commis¬
sion, we cannot mark time. There¬
fore, we are taking measures to
improve economic conditions in
Korea
prices. The foreign exchange that
might normally be expected to ac¬
crue
for
sound
with
Exist
provided for individuals and
Korean
issues
the in¬
evitable result of accelerating in¬
flation and a progressive rise in
why
Relations With China
Last but far from least
with China a
comprehensive "Treaty of Friend¬
ship, Commerce and Navigation."
of
note
Generally speaking, what is un- ;
for private capital is un-"
sound
tary measures will not accomplish
an
enduring settlement. That is
American materials into the
I j might
overcome,
guess
large
ment
Although it is not possi¬
ble to say how soon these obsta¬
southern
the
where,
as
the
cilities.
to bring about immediate or
early
resumption
stability.
But history, I- believe,'
In
cur¬
rency
pursuit
of ^de¬
veloping commercial and cultural
relations.
inflated and unstable
an
will be possible
broader, objective
our
are
to
primarily
our
Will
•
,
Japanese
trade is controlled
seas
Southeast Asia
interest
of
expendi¬
tures China has had to resort4 to
Chinese must resolve the present
political impasse before any sub¬
stantial improvement can be ex¬
pected in China's economic situa¬
the
insure the effective industrial dis¬
you
of
areas
been
military
of
armament of Japan.
As
the
States
to
and
items
commerce
Far East and at the
the
independent state. It may be an¬
ticipated that, with a return to
more normal conditions, the Phil¬
ippines will again represent a sub¬
stantial and expanding market for
American products.
7777From the standpoint of business,
diverted
revenues
.■$,
.
*
expen¬
of repara¬
Eastern
for the benefit of
meeting
in
manifold problems facing it as an
of China's
before
reached
Far
Republic
new
80%
are
enemy
Our main pur¬
shall be to achieve a healthy
pose
levied at the end of 20 years.
We expect to cooperate with the
are
of
supply for such products as rub¬
ber, tin and petroleum.
Because
the problem
on
sub¬
end of this year.
the
1
inter-related
are
ex¬
reached
some
regard to
the amount and types of industry
that Japan will be allowed to re¬
cision
up¬
between
the outlook.
have
as
re¬
purposes. Because of the wide gap
are
is
ported recently
has been
stating that
years, after which a graduated
tariff will apply until full duties
say something of
doing in the various
of the Far East, to brighten
cision
Soong
picture is not
Japanese economy until
-
Premier
,;
wards
to proceed with plans for postwar
Our Role in Far East
Act"
sity.
ditures
,
want
areas
Trade
aggression and. occupation, They
cannot .stand much more adver¬
continue to enjoy free trade with
the overall
we
"Philippine
suffering
the ravages of 8
years of Japanese
interest in their
an
encouraging and it is not
what
The
already
con¬
econ¬
provides that the Philippines shall
tention to dress it up in attractive
colors.
In the brief time allotted
me
;
wise
of China
this country for a period of eight
who will show
But
business
1
that they will be glad to do
with any or all of you
me
that
we
wisdom
proof that by virtue of its poli¬
tical, economic and trade policies,
it is a good credit risk."
private
Restoration 7 of
; stability
and
Chinese economy is
retarded by the
unhappy-politico-
direction in
,
urged in the interest of all peo¬
ples that no country; should
attain¬
long-range economic
to you the ups and downs of Gen¬
eral Marshall's mission. The Na¬
Philippines is recon¬
Congress has approved
two measures: the "Philippine Re¬
habilitation Act" and the "Philip¬
pine Trade Act of 1946."
facing
being made to dis¬
courage other
•tl
1
.
*
,
7,
Volume 164
Number 4544
THE COMMERCIAL & FINANCIAL CHRONICLE
2635
Inflationary Experiences in France-the Effects
(Continued from first page)
has
the
nature
of
rent, in
a
the
economic sense. >
,oi■;!;#://>/;•/, \ /
France's Historical Experiences
j
There are many illustrations of
the preceding
theory in the eco¬
nomic history of France, v The
most
outstanding have been the
experience of Law, the so called
"assignats,"
,
that
and
-
which
lowed World War I.
Although it is
,
hundred
of
;>■
Law, which
,;
than
!
two
the experience
to have been
seems
the first notable
attempt to introduce the use of banknotes in the
western world, remains in the
; memories
of
many
dramatic financial
.
\
more
years ago,
fol¬
people.
ruin
The
of
many
individuals, which coincided with
; the breakdown of the system in
1720, did not overshadow the un:
precedented business prosperity exiperienced during the four previous
% years;r The contemporary chronl
% iclers, in spite of their" severity
•
toward Law, do not try to conceal
the great wealth increase
which
"France enjoyed
experiment.
■!."
as a result of his
i
The. experience of the "assig4
•nats"
(State fiat money) took
place between 1789 and 1797, in
the
.
midst
heavals
;
of
well
as
external
great
political
internal
as
France
wars.
up¬
and
emerged
| in
a very impoverished condition.
But business was
•
relatively spared.
•It
seems, even, that the profits
realized during this period consti¬
tuted the financial basis for its
development during the next
cen
tury,
;
Lastly, the ten years which fol¬
lowed World War I were a period
.
i
of exceptional business prosperity
in France. To the existence of un¬
satisfied
i
needs
in
all >
quarters,
which js
a natural cause of infla¬
tion after wars, were added in the
r
legislative field
,
no
a
series of other
less important inflationary fac¬
tors.
;
Alawof 1919 charged the State
for the cost of repairing most of
the private property which
was
damaged
,
The
during the war.
government's budget deficit
tinued
until
1926.
con¬
"Finally, the
•
purchase of foreign currency ef% fected since July 1926 by the
Treasury and the Bank of France,
following
the
Gold. "Exchange
•
Standard
a
practice, brought about
large expansion of the money sup¬
ply. Inflation and the correspond¬
ing rise in prices would have been
much, greater .if • the traditional
.
prudence of French concerns had
not. prevented them from distrib-
•
liting
most
of: the
profits
'they
/
.
4
1
had Carried
period,
which
during
this
in
the
30's, has become unpopular,4 It is by qualifying them
as
deflationary that certain in¬
fluential circles at the end of 1944
prevented the enforcement of
cer¬
tain measures, such as the block¬
ing of banknotes, which were necessary to stem the progress of the
.
existing"
inflation. J This
infla¬
tionary process, which has lasted
'
.
government
end
of
refrained
;
1944
-
until
the
six
presents
years,
aspects
that
one
so
many
may
new
wonder
whether it will bring similar fa¬
vorable consequences for. business
!as the previous inflations.; v;>;The Current Inflation
*
'
pressure on
price levels
most
was
numerous
incomes due, for instance,
to the absence of their
owners, to
the interruption of international
relations,
or
to various admin¬
istrative blocking measures, nota¬
'.a
third
income.
more
©f
more
of
than
her;pre-war national
This levy was all the
burdensome
production'
was
the
in
which
set habits
were
more
than
during the
partially for past losses.
liberation
particularly burrespect and cost
important concerns, especially
metallurgical
ones,
a
large part of the reserves built
densome
was
.
in this
several
vv,V; 'J/
Non-Adjustment to
Occupation Conditions
A
second
many
for
losses
of
cause
for
especially
most important of them,'
French
the
concerns,
has been their reluctance to adapt
themselves to the economic con¬
ditions
tion.
the
of
Since
period of
the
occupa¬
invasion
of
the
before
these
the
the
It
war.
concerns
benefit
are
from
is
true
;
that
today reaping
past
sacrifices.
Employing their former personnel
it
makes
sume
easier
for
normal
a
them
activity.
emphasizes at the
same
to
re¬
But
it
time the
country in June 1940, the.main¬
taining of productive activity has
obstacle put in the way of recov¬
met
bottlenecks.
a
series of obstacles different
in nature.
which
of the
Some
ery
concerns,
Current Improvement
depended
upon v foreign
have seen their markets
orders,
close.
Most
trary,
did
of them,
not
on
lack
by the persistency of certain
the
outlets
con¬
but
Thus,
French
for
various
business
reasons,
has
suffered
losses
during the war years. At
rather one or several of the re¬ the
present time, in spite of the
sources
indispensable for administrative price control,
it
production. The absence of part is
generally
earning
profits,
of
the
specialized
manpower, though to a variable extent ac¬
which was prisoner in Germany, cording to the different branches
of
a
production. Indeed, except for
greater price increase in France,
conditions
under
which
it
the
.
operates, do not differ essentially
from
those
which
in the United
not
prevailing
are
States. And it does
that such conditions pre¬
American
business from
seem
vented
the
future resumption of normal
activity. Whatever may have been
the
motives
tended
to
charges and
penses
the
of
such
maintain
even
a
the
policy, it
overhead
the working ex¬
atlevels close to those of
when receipts were
prewar,
falling at the
duction.
The
same
year
time
as pro¬
following, the
making profits.
If by a steady V
budgetary effort the inflation now
existing in France is gradually
reduced, one may expect the re¬
sults of this inflation to
be
tively
favorable
and thus,
despite
business
to
rela-;
circumstances,
the theory to be once more con¬
firmed. After all, it is by increas¬
ing business profits that inflation
stirs up the economic forces cap¬
able of reabsoring it.
gins are
as a
Profit
mar¬
matter of fact the in¬
for
ducement
entrepreneurs,
jures the lower class of the popu¬
lation, is a deplorable evil; the
injustices which it involves should
be compensated. Economically it
is also
an
evil. Even if it remains
moderate, it distorts the expecta¬
tion of the markets and promotes
undesirable
investments
which
factor of crisis in the
future. However, as it. carries its
own remedy, its consequences are
perhaps less serious than those of
deflation, Which is chronic by its
may
very
be
a
nature and is not
recting.
/
,,
losses
proceeded prin¬
two sources. The
first was the rise in prices which
took place during the time which
elapsed between the depreciation
or consumption of
capital goods
and their replacement.
Together
cipally
with
from
the
disinvestment
,
BEST LOCATION
fOR SMAU. PLANTS
• •,
employing
which
went
up to
100 workers. In the excellent small towns of
sets,
appeared, such as inventories or
equipment, r The
proportion of
renovation. Yet, disinvestment has
liquid assets grew gradually and
When
the
time
to in 1944 it had reached
high fig¬
replace equipment^ the productive ures. >
However, the consumption
capacity was so enfeebled that it of stocks and the depreciation of
and
the
of
investment.
wage
Prices
level then climbed
steeply,
During this critical period the
by the Air
lies will prove to have been
partic¬
ularly valuable to France. The loan
Administrative Controls
What,
countries
inflation
in
France
has
an
tlie efforts
of
as
in
other
given the current
original aspect are
the
raw
materials for many industries.
expanding markets
are
*.
rich,
eloseby.
came
could not meet the increase of ef¬
fective demand inherent in the re¬
sumption
Georgia you'll find friendly, native-born workers,'a mild
climate,
Administration
equipment were computed, as a
rule, at their original cost. The
cost of
Write
Industrial Development Division, GEORGIA POWER
COMPANY. Atlanta. Georgia
replacement, when it could
be taken into account, was neces¬
sarily based upon official prices,
and consequently lost much of its
significance. When, at the end of
the war, entrepreneurs began to
reconstruct their equipment and
inventories, both wages and prices
had greatly risen.
Therefore, the
actual
cost
of
this reconstruction
proved to be higher than the
serves built up to pay for it.
re¬
In
fact, the working capital had par¬
tially or even totally disappeared
and in- order
to
reconstitute
it
many
concerns
were
increase their capital
row.
obliged
or
to
to
bor¬
In the-latter case, the rise in
PLANT
Future
in
,
self-cor¬
\
The Causes of Losses
;
These
cultural and industrial equipment
wear out from lack of
upkeep and
limits.
at
least for entrepreneurs not enjoy¬
ing monopoly, to develop their
production as long as it remains
below the demand. Socially and
politically, inflation, which in¬
preceding years.
capacity to deprive entrepeneurs of the ex- prices which is presently going on
*
then impaired ,ceptional
scarcity profits which the tends, it is true, to lighten their
as
Business
on
compensate them
raw/
contribution fixed first at 400 mil-
daily, which absorbed
than
on since 1940, monetary as¬
that is demand and shortmaterials and jnanufac- term
debts, progressively replaced
tured products;" allowing the soil
in the balance sheet of concerns
to impoverish itself and both
agri¬ the •> real values which 1 formerly
of
.
;
France
acutely felt. Several forces which four years old.
For the Admin¬
during the war contributed to istration even /the limiting of
moderate the effective demand, as
profits has i become, a hard task.
well in the sphere of consumption
Faced with a large demand, en¬
as in that of
investment, eventu¬ trepreneurs are well-placed to disally ceased to play their part. One cuss the fixing ofofficial prices.
of the principal of
these, as far as Most of them are all the more
consumption expenses were con¬ eager to defend their profit mar¬
cerned, was the non-utilization of gin /because they suffered losses
•
francs, later at 500 million
and finally at 1,000 million franc$
in
to
.
began
when -the country
was"; occupied granted to her by the Export Im
■Jby e n e m y</ troops, : ; It . is a port Bank and that being consid¬
C known fact that, for the al¬ ered by the International Bank
leged purpose of meeting occu- appear notably as decisive factors
pation expenses, France had toward the rapid restoration of
to pay during; four years a war her
productive capacity.
.lion
efficient
and
burden
long-term bor¬ other countries, it is due firstly
was
a
first
and
serious
hin¬
rowing.
The budget deficit was to the important:
place held by
drance to many manufactures. The
met principally by issuing Treas¬ small
concerns.
The small entre¬
dislocation of the transport system
ury bills and additionally by bor¬
preneur, indeed, is still common not
rowing from the Central Bank. To only in agriculture, where he is the in 1944 held up the supplies of
raw
materials and paralyzed in¬
the extent that the Treasury bills
majority, but also in industry
were
bought or repurchased by where artisan production is far dustry almost completely. Certain
bottlenecks still exist, especially
the main deposit houses and other from
being negligible. While the
banks, there resulted an increase multiplicity of c o n c e r n s in¬ coal which affects almost all pro¬
in the amount of the demand in¬
duction, and iron and cement,
creases the
difficulty of control,
which are derived from it. The im¬
debtedness of the bank system, the absence
of bookkeeping in
mediate pecuniary interest of en¬
that is to say, in the amount of
large
number,
or
its
inade¬
trepreneurs would have required
money in circulation. The increase
quacy
when it exists, deprives
that they adapt their activities to
of available money brought a re
the Administration of its principal
the new conditions or that they
duction in the long-term as well as
weapon.
This accounts for the
the short-term rates of
discharge the workers who, due
interest, fact that, outside of big
and
to the circumstances, could not
the existence of which was utilized
medium-sized concerns, the regu¬
be employed profitably. In fact,
to refund the stock and thus lighten
lation of prices has not always
most
F r e n c h
the weight of the public debt. The
entrepreneurs
been rigorously observed.
adopted f. the
lowness of the interest rate would
opposite
attitude,
Furthermore, the country was avoiding as long as possible any
even more have diverted the sav¬
prompt to realize, after the inva¬ change in their
production, and
ings from monetary toward real
sion, that rationing measures and striving to keep
assets and thus caused a greater
employed not
control of prices principally bene¬
rise in the price of the latter if
only
their
administrative
and
fited the forces of occupation by
technical staff but all their other
administrative and fiscal meas¬
permitting
a
better use of the workers. Many of them did not
ures
had not limited their yielc
fixed contribution paid to them want
to risk helping the enemy
and if political circumstances hac
as
occupation
expenses.
The war effort by changing their pro¬
not rendered precarious even the
unpopularity of these measures duction or, by dismissing their
control of the owners,
was
thereby increased
and personnel, to furnish a pretext for
As had been noted in the firs
resistance to their application as¬ their transfer to
Germany. ;/ Al¬
world war and more recently. in
sumed political;- significance.
It most all, moreover, wished to pre¬
the Spanish Civil War, it was after
was
not an easy task, after the serve their
productive capacity as
the
end
of
hostilities that■» the liberation of the
territory, to up¬ fully as possible with a view to
economic aid extended
'
less
from
bly the law which prohibited the
distribution of corporation profits
Thus, by practical rather than- beyond a certain limit.
As for
theoretical^experience,* inflation investments, they had not only
became closely linked with busi¬ been discontinued but had even
ness
prosperity in the minds of given place to rapid disinvestFrench people. Consequently de- ment.
The country largely lived
flation, the effects of which were on its capital, using its reserves
felt
•
by the absence of over a million difference between the effective
men
kept as prisoners of war, demand and the capacity of pro-1
by the cessation of overseas im¬ duction would normally have per¬
Apart
ports,rand by destructioiirpsdlt^ mitted them to earn.
ing from bombing and other war from levying taxes upon these
operations.
Further,
in
order profits, with the experience into/participate in the Allied war tented from the first World War,
he Administration attempted to
effort, France assumed military
their
source
expenses, which, particularly after dam
by
limiting
the liberation of the metropolitan the demand and by controlling the
territory, increased considerably. prices. As early as 1940 they re¬
No more than in any of the other sorted to the now classic ways to
belligerent countries was it pos¬ diminish the demand: rationing o'f
sible to meet, with the normal essential commodities, administra¬
budgetary resources, the excep¬ tive distribution of other prod¬
tional expenses due to war.
The ucts, prohibition of superfluous
budget deficit continuously grew consumption.
As for the control
until the end of hostilities, and of prices, it was aimed at elim¬
still, exists in spite of.the cor¬ inating all increase in sales prices
rective measures taken in Janu¬ not justified by a lawful increase
in costs, that is to say mainly by
ary 1946.'
Contrary Jo the policy followed an authorized increase in wages.
during the first world war, the
If these
measures
have been
•
j
:
2636
THE COMMERCIAL & FINANCIAL
CHRONICLE
(Continued from page 2609)
surance as to
ened, by
the final result. The
weavers, in clamorous
claim any evil intent.
voices, dis¬
They pro¬
the introduction of
ectivist
Now
we
are
econ¬
the
collectivism
and
managed
economy of the supreme, all-pow¬
erful State.
Thq product of their
handiwork will possess in time the
characteristics of this pattern, un¬
less
a
fore
new
the
threads
this
were
are
that
Foreign Trade
trade
the
longer
no
enterprise
be
must
be
can
of
left
individuals
controlled
di¬
and
rected by governments as instru¬
ments of national
policy.
There
is
nothing
gressive about
revival
of
cantilism
new
this
or
idea.
pro¬
It
is
a
the
that
ectivist
have
we
live in
may
chosen
course.
na¬
the
col-
v
v
United Nations Proposals
Such
is
the
primary
offered for the
proposals
Underlying the current multi¬
tude of proposals in behalf of socalled international economic col¬
laboration is the concept that for¬
but
tions
to¬
woven
order
harmony and prosperity with
tion
The State in
to
in
approach is taken be¬
gether.
eign
do
justifica-
multitude of
now
fabric
being
that
become
American
our
a
con¬
domestic
economy as well as world trade.
Each of these United Nations
pro¬
posals should be studied in its
lation to the
re¬
master
plan it is intended that
they should be coordinated under
the system under which
the kings
of
that
time
and
their
nobles
Thus
the
wolf
ex¬
years we
such
words
under
National So¬
of
1
■
:
We uayc Ataiutu that outu spec
have learned bixai/ such
»t
cious
find
we
in
the
current
credit,
leum
ment.
its everlastAmerican petroforced the with-
the
industry
arawal of
that monstrous arrange-
,
,
however, in-
u!Ck ,;Yat. instead of being
battle to
tne
to
subject
a
super-state
over,
industry
has just
our
describe
cartel
govern-
subsequently the freedom
people,
of
our
Our Foreign Policy
Opposed to
American Tradition
Much of
Government's apworld's
postwar
collectivism. Too many men in
era!
the
problems is away from
the tried and true American systern
and
towards
compromising
our
without
are
faith in the
aP°n
.
.
„
.
: Government,
curred
when it consuch recommendations
in
ability of competitive
enterprise to serve adequately the
to - undertake to carry them
*n
domestic field. Despite
needs of our
fact that jurisdiction
people.
r'
These
...
~
believe
men
ernment
„
purely
'
'
.
advisory
' - •>
Substantiation for such
an
in-
terpretation is to be found subse,
Nations might
be
developed for
the oil industry that would not
be purely advisory,
Mr.
Charles
Department
concurred
B.
Rayner,' State
Adviser,
Petroleum
these
in
suggestions.
The moderator of the program, in
governmental restrictions on the
summarizing the discussion, acproduction of petroleum and its
cording to an official State De- V
products, the fixing of prices and partment press release, asserted:
e a
ocation of marketing
quotas
«To conclude, then, we need
with, if not embracing, restrictive
our
to
economic
standing for
was, it provided a framework for
th? recommendations of an
International Petroleum Commissl0TnInherent in the implications of
Jbat agreement was the assump^on of an obligation by our Fed-
proach
to "put teeth" into the agreement
—the very opposite of an under-
quently in the broadcast in suggestions that a broader ; under- ;;
to standing sponsored by the United
begun. Ihus it is worthwhile
mental controls that in
Germany, retresh our" minds regarding the
Italy, Japan and Russia crushed £?nJerds and implications of that
the freedom of individuals. They t1
version of the Anglo-Amermask
an
economic
collectivism lca" p?troleum Agreement.
that would destroy our American
Ambiguous and vague though
competitive enterprise system and
e language of that agreement
phrases
seem to indicate Mr.
Loftus felt that there was a need
action.
,
More recent
events,
clothing
other, for under the Federal Government
reactionary mer¬ the UN Economic and
Social
the 18th Century—
Council,
j ' r \
'
of
that
sheep's
cialism hid.
woven into
may
strait-jacket of government
for
bitter
now
the threads
trol
of the
out
learned
the
which
being
projected
under the auspices of the
United
Nations Organization. These are
the
But
have
stand¬
told that the
claim their only
purpose
is to ard of living for the American
produce peace and prosperity. But people must be abandoned—that
the nature of the
pattern which we must embrace economic;! col¬
they are following has its origin ectivism.
This, it is said, we must
in
words!
perience of the last few
which produced
omy
col-
philosophy.
energies to help- which would
ing-win the war. To
ing
•.
Thursday, November 21, 1946
its attention and
World Oil Outlook
*
f
more
international control
the development
oil resources to
The
Anglo-American Oil Agreement
is
a start—a good statement of
principles, but with no real au¬
thority. These principles should
be
the
Nations to
resources is among the powers re-1
served to the States in the Tenth
against
guard
friction.
international
out
over natural
over
of the world's
extended
ernments
under
as
as
United
the
other gov¬
willing to ac¬
many
are
cept them. And they should be
implemented in such a way ag
Amendment, our Federal :;Govto assure the orderly production
ernment would attain the authorand distribution of the world's
country to be prosjty,. by having entered into this
United Nations declarations call¬
oil in the future."
perous, the Government must tell
fought to throw off the shackles ing for international control of the the people what they can produce treaty, to assume virtually an abTo that statement by the mod¬
solute'authority over the producproduction and marketing of basic where they can
of mercantilism.
produce it and at
Inspired by that
erator
Mr.
Rayner
responded;
tion and distribution of
foods and the "stabilization" of what
petrolesuccess, the European nations,
price they can sell it. Pro•
"That's right," and went on to say
too,
agricultural prices by fixing both fessing to be friends of the people, ™
turned loose the initiative of
men
that the sooner a world-wide oil
maximum ceilings and minimum
and in the 19th
Century they re¬
floors.
corded
with
their
m*nt was in a11 resPects a
UP
greatest
economic
Presumably this is to be accom¬ the average man to take care of state cartel Such
progress.
cartelization
Opposes Anglo-American
y;?But out of
plished through a
would constitute national Socialnetwork
of himself
Agreement
;•
Germany came
_•
v
ization of the petroleum industry
movement back to the
Yet they possess no intelligence
As far as I am concerned we are
principles inter-governmental c o m m o d ity
here ancj abroad. For these
sought to impose monopolistic*
re¬
straints of trade upon the world.
Our American Revolution was
proposals
before
the
Food
and
Organization of
the
mu^t guideiand•direct our
They believ
th
activities.
,
Agricultural
,i
o
j
4.
order for the
1
i
_
vvv/uiu
attain
wic
autuui-
••
-
^ontemUhonPThe^mti0<S
.
of mercantilism.
ment
It
fashioned
brain
iii
Karl
of
was
the
Marx
a
move¬
diabolica
and
given
form and force by Bismarck.
Its
aim
was
control
by the all-pow¬
erful State over the economic af¬
fairs of men
ernment
tives.
through cartels, gov¬
trading, edicts and direc¬
Soon
cartels.
Provision for
inter¬
reasons
superior to that of the
themselves. Look back a
little
more
Department
these
men
other
pending
the
agency,
before
an¬
International
;
Trade Organization of the United
people
difficult
So¬
cialism of Adolf Hitler.
This virus spread
and
more
the
collectivism
been
Lm th!
than
a
and
yfar ago when anrt it wa, withdrawn from the
was
forecasting a de- senate where it" had" been" sent
pression with eight to ten million f0r ratification
unemployed in. thfe first postwar
prise.
economic
have
the
Governments have
to
are
But
nullify
At
all
all
mental
men.
to restrict the
'
,
of
-
.
Russ a,
Germany and Italy suc¬
cumbed to absolute Statism
or totalitariamsm in which individual
freedom for all practical
purposes
was
extinguished.
In !
much of the
England
collectivist philosophy
of pre-Nazi
Germany tias become
imbedded.
In
other
European
countries, in the Far East, in Latin
America, the trend has been toward State corporations, cartels,
both
private
and
governmental,
manipulation, subsidies,
upduly high tariffs, import
quo¬
monetary
tas.
other
such
for
places
which
is
the
these
cartel
there
virtually
high ideals.
events,
grees.
opportunities
in
exceptions
proposed
pressures, in varying de¬
to fetter the free function¬
and
it
member, nations to for¬
restrictive undertakings and
embrace
competitive
enter¬
of
Socialism
ing.^ of markets and
that
say exactly what it
In one place it calls
during the last
steps taken
false
the
on
exerted
activities
double-talk,
to
mean.
swear
fermenting throughout
whole world.
does
beyond the
For 25 years
germs
or
much
so
forecasts..
-
With eauallv
ing,
ast
erroneous
upon
us,
tunitv
system
3
but
with
of establishing
agreements
is
so
rear
door of
and agreements
Har¬
us
Mason
of
vard, who is partial to • them,
"countries adhering to a commod¬
ity agreement would have to com¬
mit themselves to a definite line
their domestic hand¬
on
of the
modities."
regulated
com¬
"Clearly," Professor Mason
to
goes
"the present domestic
agricultural policy of the United
States is quite
incompatible with
participation in the proposed
of
such
svs-
a
international treaties
Pro¬
Edward
ling
only partial
the oppor-
intergovernr tern in this country through the
that, in the words of
of action
seeking
collectivism
Now they see
fessor
S.
of
reason-
fo? ?he
of these men
years have been
14
force
to
■
many
success.
framework
resulted from
the basis of these
year
on
broad
on
say,
collectivism
In
this
hone to
wav
thev
achieve' in
mmfner whal
a
constitutional
otlmnvise
and governments
tradmg with other
governments,
economic
ties of
activi¬
competition and constant restric¬
of individual freedom.
Ex
tion
cursion into collectivism in
recent
have-been frequent. While
traveled
a
long
years
have
we
down
the
pulsory
to
way
road
state,
return
-
to
toward
there
*
the
a
150
to
their
and
construction
the
International
our
the
World
of
-
was
per¬
rewards
of
wealth
created
and
multiplied
through encouraging
to
exefcise their initiative.
as
a
result, for the first
and
men
Here,
Bank
for
and
Re¬
Labor
Health
•
Office
Educational, Scientific' and Cul¬
Organization. All of these in
tural
be
tied
into
the
Eco¬
Employment Commis¬
sion and the Economic and
Socia
Council.
.
Throughout all these proposals
only certain
words
appear
and,
reap¬
time in history, an
overwhelming pear: Stability! Orderly Develop¬
majority of a £r?at mass of people ment!
Cooperation!, Collaboration!
enjoyed decent standards of liv¬
Mutually Advantageous!, Full Em¬
ing. Only during the last two dec¬
ployment! Integrated World Econ¬
ades has our
economy been weak¬ omy!
How
alluring are those
squired concession
(
01
an
1 believed the oil men who had
participated
its
in
drsfting
hnd
adequately safe-guarded our domestic industry against restrictive^
I further believed it
actions.
was
desirable to have some assurances
that valid concession contracts and
con- equal opportunity in exploration
and developments abroad would
Interna?
lional Petroleum Commission to
study and report upon the prob-
is
This
the
law
with the
supreme
be respected.
But if this Agreement is to be
the camel's nose under the tent
of
restrictive
a
inter-govern-
that threatens us, for pursuant to
For
this
upon
it.
We have more than the LoftusRayner broadcast to warn us to
be on the aJ®rt:
,
,
ment to act upon them. It was • Refer to the Charter suggested
paramount danger furtber agreed that the govern- by our State Department for tho
reason
each
of
these
.
ments ?f all oil producing and proposed International Trade Orconsuming nations would be in- ganization of the United Nations
Vlted to become parties
agreement.-i!
the wherein recognition is given to
to
inter
This revised draft was acceptable to the industry, by and large.
Standing
alone
it
could
not
be
-
cartels
governmental
commodity
relating to • "exhaustible
natural resources."
Read all
—-
-
5,;
the provisions in that
_
United Nations proposals, and all
treaties and international agree-
used as a vehicle for restrictive document, but particularly the
control of the industry. The Brit- chapter entitled:
Inter-govern<
ments, should be scrutinized in ish accepted this revised agree* mental Commodity Arrangements,
every detail to guard against the ment in September of last year.
Take note also of the recent call'
possibility that they may :rad- The Senate has not yet acted on it. for the convening of a United Naand
economic
country.
structure
of
this
;
Organization,
the International Refugee
Organ¬
ization and the United Nations
paS£! a11 its intentions in the field
mental cartel, then it becomes a
the
Development ically change the entire
political
will be tied into the
operations of
initiative, ingenuity, skill turn will
industry. We had a system nomic and
which
Inter
Organization
and
time
faith
the
Trade
International
com¬
our
achieve
national
the
the
country
land of
opportunity for all
sons
•
years
the Food and Agri¬
Organization, the
still
is
Founding Fathers.
For
Of course,
cultural
f^n/does nlt° mean°the
ment does not mean tne pendtoa
pending
version of the treaty to encom-
real danger to our industry and an
unrelenting fight should be made
treaties
for " these
marketing allocations.
.
international petroleum trade was
Provided. But 1 was clearly unof the land
on
a
par
derstood that the findings and
Constitution itself, over-riding recommendations
of this Comother Federal laws, and nullify- m}s*10n
wer+e to
of a purely
ing State constitutions and laws ^dvisory nature and that no obwhich may be in conflict with the bgation rested on either Govern-
,
or
Agreement was before the Senate ;■
makes
do with the control of
production
people, with its lessening of price
the
along with the revised Agreement
a dra"
agrf up?n whlcb
the effect of sssuring eQusl
nationals of
United States and Great Britam to devel.°P oil resources m
their respective jurisdictions and
recognizing the validity of all law-
would^^^ le?S' trends and activities of the
proposed
framework
when
r>
~
Establishment
annarentlv
were
Petroleum In- of international oil, then I, for
wt
re-
.
we
original Anglo - American Oil
original nugiu - nnicubcm
collaborated one> am °PP°sed to it, and I ask
nori_
+
+
jIV+t
+6 ?
your help to do all we can to
department and the Petroleum bring about its defeat.
Administration for War in reprior
to
the
Loftus-Rayner
^i®io§ the original agreement to broadcast, I was willing to go
leU
the
,recallV 3
n?U SL\
V
Hiiet™
,
where
back
unconstitutional. The Constitution
,
Our farmers should
take notice!
should we. The
of
ainder of the world.
type treaty v
commodity agreement."
So
the
to
designed to
the
treaty making
power,
the
inter-gov¬ Federal Government can exercise
ernmental
commodity cartels over our lives and activities aur; C>ur United
States, too, has been might well cover any
inter-gov¬ thority and controls which otherafflicted
with
this
bureaucratic ernmental oil agreement
having to wise would be impossible.'
power over the
bartering
industry, to a man angrily op' this' nrnnn^rl flprppmpnt
nosed
were
year. Events proved them wrong,
language of this latter pro¬ Nevertheless much of the economso muddy and filled with
ic agony which we have suffered
The
the
,,
Nations.
personal activities became the ob¬
of the State's control until
it culminated in the National
borders of Germany.
the better"
,
vision
or
governmental cartel agreements is
made in a proposal by our State
and
political
ject
;
such
posal is
men's
super-1 organization is set
;
.
International Oil Agreements
There
the
until
tions Scientific Conference on Re-
August when State Department spokesmen in a radio broad-
tion to meet in the last six monthg
matter
stood
last
cast made clear their thought that
this agreement
was
not to be the
source
Conservation and Utiliza-
of next year to survey the extent
of exhaustible natural resources
Oil
long has been of particular final solution of the controversy throughout the world.
to these economic plan- but, in effect, was "only the first '
Consider these development$r
They sought, in a fashion, to step toward the world-wide agree- with the Loftus-Rayner broadcast
cartelize the American oil indus- ment we need."
in the background, and ask yourtry under the Blue Eagle of NRA.
Mr. John A. Loftus, Chief of the self whether you can visualize in
When the
Supreme Court shot Petroleum Division of the State your mind, precisely and cerdown that bird of ill-omen, it was Department, who thus character- tainly, what is in store for the oil
clear* even to the planners, that ized the agreement, went on to say industry. It cannot be done. And>
their objective could be achieved that "the objectives of the Anglo- until we know exactly, and cer-»;
only by indirection^
>
American Oil Agreement need to tainly what is contemplated, we
Suddenly, in the sufnmer of be implemented and strengthened should withhold our support from;
1944, they' dropped the Anglo- on a world-wide basis."
any international .undertaking afAmerican Petroleum Agreement
-I direct your attention to the fecting oil."
concern
ners.
,
,
upon
an
r
industry dedicating all phrase: "need to be implemented,"
In fairness, it should be
noted
Volume 164
-Number 4544
THE COMMERCIAL & FINANCIAL CHRONICLE
that two weeks ago Mr, Rayner
appeared before the Independent
tels.
They lay here at home, not
alone in the earth of America, but
the scientific research labora¬
Petroleum Association of America,
at its Fort Worth meeting, to dis¬
and initiative of the American
vigilance of the past dec¬
ade had been preserved.';
41
extend gov¬
intent to
any
ernmental control
over
the oil in¬
dustry beyond, the boundaries of
tories and, above all, in the
of oil. Thus
tional
defense
satisfied
The
men
the needs of
were
The
spirit
in
na¬
two
Act.
satisfied should
the
Government
embroiled in
has
contem¬
never
'
war.
Our industry stands ready to¬
than advisory
functions
to
any
international day as it did in war to cooperate
to the utmost with those in the
body in the petroleum field."
Passing over Mr. Rayner's com¬ Army and Navy charged with pre¬
petency to speak for the Govern¬ paring our national defense. We
ment, let me say, either he suf¬ ask only that they have faith in
fered a severe .lapse of memory the ability of free men to produce
on
that occasion as to what has what may be needed again just as
transpired in this field in the last free men produced all that was
30
months—or
he
deliberately needed in the conflict just ended.
undertook to deceive his audience.
In the field of foreign oil our
plated giving
more
'
His
statements
reconciled
with his
there
with
cannot
facts
the
be
nor
—
words in the broad¬
own
Agreement
the "open door" principle of
opportunity in exploration
and development rights; and, upon
Rayner's
fool
Independent
the
by
Association
after
Mr.
departure,
very
he did not
As a matter of
large and growing
many.
fact there is
a
our industry who now
Senate indorsement of this
segment of
oppose
treaty..
i f No demonstration has ever been
made of
the necessity for any
special treatment of oil in inter¬
national affairs. The plea that "we
are
running out of oil" has be¬
shelf-worn
come
time
with
oil
American
all
marketers;
upon
the Anglo-American Oil
Petroleum
go
•
August, as released
the State Department. - •
on
to
reason
no
of
iff Judging by the adverse action
taken
has
beyond insisting
upon ■ non-dis¬
criminatory commercial treatment
by
last
cast
Government
equal
adequate compensation
property by foreign
governments.
But our Govern¬
ment
should
do
exactly
these
things in respect to all Americans
and commodities of trade through
general treaties of amity and com¬
merce.
'
just
and
for seizure of
American
privileges,
Neither
jected
oil
home
at
do
asks
want
we
special
abroad.
no
or
be
to
sub¬
super-state cartels and
to
other restrictive controls.
We
and
ask
the opportunity,
home and abroad, to do
only
"has been riddled to shreds by the
of events.
both
course
business in the traditional Amer¬
I
ican
As pointed out earlier, we have
today—despite the demands of the
war years—the largest proved re¬
serves in history.
We also stand
today on the threshold of techno¬
logical developments which prom¬
ise to multiply our resources and
their
utilization
more
two¬
than
fold in the immediate years ahead,
f j This is the
to the re¬
quirements of the military serv¬
answer
national defense.
ices for
Means
satisfy those requirements do
not lay across the seas; neither do
they lay in any governmental car¬
to
at
manner
with
comers,
on
pf trade.
many
times
shall mul¬
we
past
our
con¬
tributions to raising the standard
of
living
assuring
and
defense
tional
of
the
na¬
American
the
people.
realized
was
law alone accounts for the
improvement in
standards
munity.
of
I
the
the
that
Regulation
llilllifcWill'Be Relaxed
of
heading.
The roots of the securities legis¬
lation which the Commission ad¬
and where we are
we were
lost and confused.
We do not want to
see
that hap¬
again..
pen
the
a
deal
day by day, those who in
large part account for this devel¬
opment in the community's sense
of
responsibility,
we
have
had
demonstration
ample
that
the
community is in basic agreement
with
the
standards
laws.
our
that
we
that
It
this
is
have
embodied
from
The
years
which have
passed
since the adoption of the Securi¬
You
gentlemen are fa¬
broad objectives
of that legislation: among them, to
procure full disclosure about se¬
curities;
to prevent fraud and
manipulation;
and
to guard
against improper handling of cus¬
ties Act of 1933 and the Securities
with the
Exchange Act of 1934 have been
among the most critical in Ameri¬
can history.
We were in a deep
and world-wide depression.
As
liistory.
miliar
accounts.
tomers'
There
is
not
a
standard under which we
single
work
that
ideals
and
life.
in
deep
is
to
alien
American
the American way
of
Honesty, and a concern with
decent practices are not
^revolutionary ideas to Americans.
<Juite to the contrary, they are at
the foundation of our financial
truth and
are the
has been
life-;, they
^all
the
that
American
hall-mark of
worthwile
in
financial commu¬
nity throughout its history. ,:-
1- The tradition of sharp practice
lias vanished even for shopkeep¬
ers.
It certainly has no place
in a
profession which cannot survive
Without a basic public confidence
and
cannot get that confidence
without preserving a strict sense
of its responsibility to the Amer¬
ican investor. V.
'y •:,.:
Ethics Are Legislated
The
standards
of
professional
we
the
out
existence
of
there
group
those
are
in
was
with a
•rig or a pool whenever it was felt
she was lagging behind.
When
the day came to face
dreadful
consequences of our irresponsi¬
tice to help destiny along
war
we
a
-
it take
body blows and still
stand firm, we can easily be mis¬
led into dangerous relaxation of
vigilance.
We are likely to for¬
get that it took years of hard
work to strengthen our standards
that
could face heavy de¬
security prices without
facing also a wave of forced liqui¬
we
of
dation and failures which inevita¬
bly result in panic.
This law has been in operation
for twelve years.
Yet, in spite of
early prophets
of doom,
the
law has worked; the SEC has not
over
the
management
of
American companies; there has not
dous
of
a
universal,
or even
withdrawal
of
tremen¬
securities
exchanges; we are members
society in which democracy
and the American way of life still
stand firm. And, our markets have
shown the kind of resilience that
would have been impossible un¬
free
of
vindictive-
The Joint Responsibility
Both the honest brokers and the
investors face, at this
clearly defined necessity.
is the necessity at least to pre¬
a
those gains which we have
against the forces which led
serve
made
the
to
boiler
shops, the bucket
the high-riding irre¬
sponsibility, of the days before
shops,
the
and
statutes.
have
Those
in
been
of
you
who
business
the
long
enough to have seen its peaks and
pits, and to have witnessed
turning of its cycles know
its
Your business
mean.
survive without
lic
confidence
markets and
customers'
dence
the
basic pub¬
the
securities
in
affairs.
great
handling of
That
lost with
was
the
depression
want
to
can¬
a
in your
confi¬
onset
and
of
you
that
happen
again. Those of you in the trade
who know that you can make a
decent living honestly in the secu¬
see
business
feel,
I do, that
the business
must
be protected
from its submarginal fringe.
For
your own welfare you need, just
as
the
investor
securities
as
does, to have the
laws
in
existence
and
honestly enforced.
We
many
can
hear
glittering generalities. I talk
about
real
things when I talk
about
our
adjusting
legitimate
ourselves
business
needs
to
and
I
take
this
opportunity
of
an¬
nouncing publicly some of the
steps we have taken at the Com¬
mission
to
adjust our procedures
to
improve and simplify them.
First I think it important to let
know
you
that
has undertaken
of
the
forms
and
time ago
perennial
of restraints
in
ways
and
which
be administered.
maintain
in
a
restrains
are
all
there
are
restraints
You cannot
your
high-binding
standard is
complaint
high
professional
business with
license.
And
no
a
standard
>
There
real standard unless
license.
It
was
not
procedures.
out to the world in
of effectiveness of
Commission,
any
standards—external
or
internal—to make the path of the
securities seller easy.
The easy
path
is
primrose path.
We
must not permit a relaxation of
vigilance that opens the way to
the
degrading
of
professional
the
standards
and
the
loss
of
public
trust. The way lies rather in hon¬
est, sensible 'administration of the
law; with adjustment by the fi¬
nancial community to conform¬
ance
with
its
standards
and
ad¬
justment
by the Commission to
legitimate needs of busi¬
ness. The legislation administered
by
the
Commission
embodies
standards which are an integral
part of the American way of life.
meet the
proposals and,
have opportunity
will
with
these
make
they make
in
are,
of
to
be¬
proposals
to ns and
sense
view, utterly consistent
our
the
interests
the
of
public
and of investors. We ask for your
cooperation
and
these proposals
suggestions on
because our past
experience shows that
we
do bet¬
ter and go
further by telling peo¬
what we are about and in¬
ple
viting their help.
Nati Alfalfa Stocks
Some¬
advance
prospectus.
We
"red-herring"
have
Placed
Market
on
Public offering of 58,860 shares
of 5% cumulative preferred stock,
and 505,220 shares of com¬
stock, $1 par, of National Al¬
falfa Dehydrating & Milling Co.
was made Nov. 19 by a group of
munity
that
those
on
sug¬
com¬
proposals
and
par,
mon
received
helpful
gestions from the financial
:
nvestment bankers headed
by
Stone
Webstei*
&
jointly
Securities
should Corp. and Bosworth, Sullivan &
Co. The preferred stock was
might re¬
mark, as an aside, that we have priced at $50 per share with com¬
been tentatively moved
by com¬ mon stock warrants attached, and
ments from the financial
the common stock at $9 per share.
com¬
munity to eliminate some of the
Proceeds from the sale of the
requirements originally proposed stock will revert to members of
by us in our proposed "red-her¬ the purchase group which organ¬
ring" rules.
ized the company and for whom
be
step of
our
completed
program
I
soon.
the
Prospectus Rules to Be Eased
securities
being sold. The
are
outstanding cap¬
proposing a series italization of 60,000 shares of 5%
of changes in
stock
(par $50), and
our forms and pros¬ preferred
pectus requirements to carry for¬ 643,000 shares of common stock
ward our promise to
improve and (par $1).
\ /
simplify our procedures.
These
National Alfalfa, the largest pro¬
are designed not
only to lessen the ducer of alfalfa meal in the United
burden of registrants but to aid in
States, owns and operates 34 mills
speeding ■ up
the
Commission's in 12 states. The
company was or¬
processing of registration state¬
ganized in May of this year by a
We are
company
ments. I do not wish to discuss the
proposals as to the form and pros¬
pectuses in detail. We intend to
specify
send
opportunity
Of course,
gram
group
managed by Stone
Webster .^Securities
&
Corp. and
Bosworth,
Chanute, Loughridge & Co., Denver. It was estab¬
lished primarily for the purpose
for comment. of
manufacturing, storing and sell¬
by
the details of the
pro¬
are
ing dehydrated and sun-cured air
time.
falfa meal, a basic ingredient pro¬
necessarily tentative at
However, in general,
they involve the complete scrap¬
ping of three., registration forms
this
purchase
an
tentative suggestions,
around,
and afford
our
them
ample
has
now
viding
many
*
essential n nutritive
elements-ill mixed feeds for
poul¬
The* new
copi-
under the Securities Act, the A-l,
A-2 and E-l forms; the elimina¬
try ' and livestock.
tion of that part of Form S-l call¬
pany
do not go into the
prospectus; and
the deletion of other items of in¬
formation
that
are
more
obsolete carry-overs
less
from former
duplicate
or
or
information
otherwise filed with the Commis¬
sion. For example, we cotemplate
the revision of Form S-l, the form
now most,
frequently used for the
registration, to eliminate the
cessity
of
financial
cases
supplying
information
where
similar
ne¬
historical
in
certain
information
is required by other provisions of
law. We contemplate cutting out
that
form
the
and
acquired certain assets
ing for items of information that businesses
now
the
We
registration, by $50
of the so-called
use
from
by
these
cause
we
ties
ministered
and it cannot be the intention be¬
have
I
my
improving the
the intention 'behind'the la\vs''ad¬
hind
stated,
Commission
published proposals
machinery of
getting information about securi¬
for
otherwise
comment about them.
simplification arid improvement
of
is
get more precise statements
course,
definite program
a
I
about
Simplification
utter
it
tried to
description of
proposal too specific. You will
soon
Commission's Plans for
days,
restraints.
As
our
To beat the barrel is one
thing.
To lay it on the barrel head is an¬
other. We don't intend merely to
where
avoid making
cation of the policies of the law.
American
it
Complacency Is Dangerous
Today, having seen the essential
toughness of the market, having
from
it
of
.v
a
will
cency and honesty.
was
dizzying climb and a
deep drop in the market.
.1\ v-'•"'' > NV
1 ;yy'V"
VKv
watched
not uncommon prac¬
£nd
Pearl
already witnessed some of
the problems of reconversion and
been
laws. In 1929 we
came
have
embodied in
had our own
ideas of what values should be,
our
Then
In the short aftermath
decency which we now take as a
matter of course are
who
perennially anxious to obliterate
lawfully declared standards of de¬
bor and the gruelling task of war.
taken
am
of
the
statement
available, and therefore the pros¬
pectus will no longer be required
to carry that information.
and motivated by a constant
attempt to make a sensible appli¬
many comments and
I
self-imposed disci¬
responsibility inherent
profession and who are
plines
kinds
the
But
not accept the
about
clines
Federal
our
legislation.
that at the fringes of every
aware
Har¬
so
too,
heard
frequently
desirable
securities
=
climbed out of it Poland
invaded.
seen
them,
in
development
could not have taken place with¬
rities
American
lie
ministers
de¬
federal policeman. From
bulk of those with whom we
ence
never
(Continued from first page)
bility
has
a
the
Securities
stand
there
community,
not
stock of where we
com¬
velopment of the sense of respon¬
sibility uncoerced by the exist¬
what I
to take
professional
financial
know
been within the
other.
that
do not believe that the cold letter
of the
the
on
ness,
was
of other organizations and
individuals affected by the law. I
It
will be fulfilled and
could
as
time,
If we are permitted to proceed
along that highway of spirited
competitive enterprise, then all
the bright hopes for our industry
tiply
well
a
-
,
ministration
alone
a
workable, the Com¬
mission had the cooperation of the.
exchanges and their members, as
;
barred,
none
it
Once
law
of competing with all
basis of equal rights, without co¬
ercion or monopolistic restraints
Worked
working real¬
ity out of the Securities Exchange
great wars and thus will they be
again become
Has
have made
never
the pending Anglo-American Oil
Agreement. He asserted that "this
we
Law
Commission
non-administration
We, at the Commission, continue
to stand pledged to an honest ad¬
in
avow
less the
2637
of
the Denver Alfalfa
Milling and Products
division of
Ralston Purina Co. and the Pecos
-'"r"1
Valley Alfalfa Mill Co.
"V
The company reported net sales
for the 12 months ended July
31,
1946, of approximately $14,000,000
and v net
come
profit, after Federal in¬
and
ended
profits taxes, of
excess
For the three months
$1,224,000.
July
31,
•
1946,
first
the
quarter of the company's current
fiscal year,
net sales totaled $4,-
information
291,000 and pro forma net income
required with respect to the
description of the securities of the amounted to $552,223. Directors of
issuer not being registered—ex¬ the company on Nov. 15 last de¬
cept
to
the
extent
necessary
to
appraise
the
securities, being
registered—so that only informa¬
clared
dend
an
of
18
initial
cents
quarterly
a
share
divi¬
on
the
materially pertinent to inves¬ common stock, payable Feb. 1,
tors will be required to be sup¬ 1947, to
stockholders of, record
plied.
' '
•;*
Jan. 10, 1947.
• *
~
•
Comparable simplification, and
Each share of preferred. stock
in faet, added simplification
in
the prospectus is also being con¬ will bear a common stock warrant
tion
sidered. We want to cut out of the
entitling the holder to acquire two
good deal of the additional shares of common at
lengthy description of the under¬
$10 per share either by payment
writing contract heretofore re¬
in cash or the tender of preferred
quired, and to limit disclosure
only to those portions really im¬ stock at par value. The warrants
portant to investors. We intend to will be detachable after July 1,
reduce the required amount of in¬
formation about remuneration— 1947, and expire Nov. 30, 1950.
prospectus
a
particularly with respect to non- Any preferred stock submitted in
policy-making personnel. As I in¬ exercise of the warrants will be
dicated, the. form itself would be canceled and all cash received
They can be ruined by unintelli¬
revised to eliminate the necessity
gent and vindictive administra- for submitting historical financial thereby will be used to retire ad¬
tion, on the one hand, or by flabby information in the
registration ditional preferred stock.
These
into
standards
action
by
are
a
translated
Commission.
«.
THE COMMERCIAL & FINANCIAL CHRONICLE
2638
as a
High Production
Economic Stalnlity and
■£
'
:■
*
scious of the effects of a low
spent
consumers
level
output had, as was to be
unrestricted exchange.
There is one principle which runs
thread
through such international
ar¬
rangements as the master" LendLease
agreements, the Interna¬
tional Monetary Fund, the Bank
for Reconstruction and Develop¬
ment, the British Loan, and the
agreements covering the final set¬
tlement of Lend-Lease and the
sale of surplus property abroad;
this is the realization that high
output and employment must be
Viewed as a world problem. More¬
over, we have come to realize that
national
policies must conform
with the international, principles
which we support, since it has be¬
come apparent that a high level of
prosperity in the United States is
one of the best guarantees of eco¬
nomic
stability
in the outside
like
*
V
t
V
does
This
v
-
duction and
expected,
dropped somewhat and was run¬
ning at an annual rate of $185 bil¬
lion, the annual rate of Govern¬
ment expenditures had fallen to
$38 billion. As the Government's
needs declined, the amount rep¬
resented by private investment in
plant, capital equipment, construc¬
tion, net change in inventories,
net exports, etc., rose to an an¬
nual rate of $25 billion, while con¬
sumers' expenditures were run-
clear and unbroken
a
world.;
.
! ning at an annual rate of $122 bil¬
lion.
Percentage-wise we find,
1
therefore, that from the time of
the surrender of Japan in August,
1945 to the end of the first half of
the annual rate
the current year
of total output had fallen by
while the share represented
6%,
by
Governmentexpenditures h a d
dropped by nearly 55%.
At the
same time the amount represented
by private capital formation had
166% and consumers' ex¬
penditures by 16%.
mean that proemployment can. be
not
risen by
^ looked upon as ends in themselves.
Our problem, then, is one of
It is important that there be objectives consistent with, and in seeing to it that private markets
support of, high standards of liv- absorb the goods and services pro¬
v.-,v ing and the maintenance of stable duced at a time when we are not
economic
and social structures utilizing an important part of our
everywhere. Hitler gave the Ger¬ output for destructive purposes.
>
people employment, but the Can we find ways and means of
objectives could not be self-sus- enjoying and constructively using
taining as the Germans themselves what we produce and of maintain¬
now know.
Although the German ing opportunities for profitable
worker had the dubious satisfac¬ investment? I shall deal with only
tion of gaining a momentary sense one special segment of the prob¬
of security against want through lem^ namely, that relating to for¬
;
1
his knowledge that he had a job, eign trade,
the world as a whole was becom¬
Importance of Markets
v
ing' correspondingly conscious of a
It goes without saying, that pro¬
growing sense of insecurity for
all.
Any growth in production duction and employment can not
and employment that generates a long be maintained unless there
Also, we
corresponding decline in standards are markets available.
of living can have no desirable must note that production, em¬
ployment arid distribution are •in¬
long-term results.
terdependent; that they expand
High Production Dependent on
and contract together.
Too often
World Stability
we have thought of markets, espe¬
For this reason we could hardly cially foreign markets, as some¬
hope to seek or long, maintain a thing static or fixed. Our reason¬
high level of output in an unstable ing has often rested, more or less
World. The two conditions are in¬ unconsciously, on the premise that
compatible. In time of war every whatever another country gains in
available resource is directed to¬ a given foreign market we must
wards destructive use in order necessarily lose. We need to think
man
4
'
.
-
to
,
of free and
'
f. r-
1
^^he .proposals
■
us
foreign creditors, benefited both
and the lending countries,
In
our
absolutely essential if we are to
maintain production, employment,
and economic stability.
daily needs and to expand our
and equipment is
necessarily limited. Our objective
in time of peace is that of main¬
taining the highest possible level
of -output and at the same time
make possible the distribution and
utilization of the product in the
interests of a higher standard of
living.
•
industrial plant
V
,
;
met
effect we
may have constituted a relatively .selL^- Various
small part Of our total national
from
the
United States
net debtor to a net creditor
a
commerce.
For
several
decades
prior to the war the relative posi¬
tion of agricultural production on
the
on
hand,
one
and
manufactures
the. other, in our export trade,
undergoing
were
steady shift.
a
With the turn of the century our
manufactured
products began to
and more impor¬
tant part
in our export trade.
Agricultural exports still remained
important, but in relation to our
total sales: abroad they began to
decline. This change was entirely
assume
It resulted in large part
natural.
the
from
that
fact
United
the
States
was accumulating more and
savings and shifting steadily
more
riod.
Let Us
more
with our total output in 1945.
It
the year as a whole
the gross national
no
longer became bar¬
As' a result,
we
United
the value of
The trade between the
States
and
Canada
is
a
from the
of
our
domestic
creditor
net
port to
an
we'
ex*r^
import balance if we
play the role of a true M
creditor. "This is also somewhat:
an
were' to
■.
'
if
■■
\
■;
<■
■
■
\
i
'■ ''
■
portant;.it^ is rather the level at
which both exports and imports
are maintained. Our own level of
intports has tended at all times^-to'v;
run parallel
1 country,. .Since the purchase by»
| our foreign customers Of
v
our bwit-'
products te tasually|limited: only1
The fundamental bbj ectives" of i
-
aimed
are
which, roughly, is in line with the
the achievement of
at
of economic
course
maximum
employment and trade
throughout'the world.
In order
United
that nations may freely exchange
what they produce it is necessary
that exchange rates be kept stable.
fore,
develop their
activity in the*
It is clear; there- *
jStates.
that whatever
ance
markets
world
maintenance
can
of
contribution
make
to
>
the
high level of
position of a net debtor,
a strong creditor. World
This, as you know, is a primary output and employment in the
United States is certain to be in- •
of- course, hastened the objective of the Fund;
At the
process, but the) shift was bound same time it is necessary that the fluenced.by the degree to which
to occur eventually, in any event. nations of the' world be
able 1 to we can maintain a high-level bal*4
a
With the growth of our massproduction industries and the ex¬
pansion and improvement of tech¬
nological processes, foreign mar¬
kets have become increasingly im¬
portant as factors in maintaining
maximum
employment
in
our
the
resources,
their
human
and
material
between
production, con¬
sumption, and investment in the
United States; and by the same
utilize to
maximum
-
available
assets
and
:
token the extent to which
we can
output to the
highest possible level. It is a pri¬ initiate and support stabilizing in- v
fluences operating throughout the
mary purpose of the International
•
*
J
:
Bank not only to aid directly in world as a whole.basic industries and in the reduc¬ bringing this about; but also to
tion of unit costs.
help in creating and maintaining
'
This takes us to the point where a sense of stability which will
make possible the ready employ¬
we can take
special note of thq
direction in which our foreign ment of private capital in areas
economic policy has been develop¬ where;; constructive development
Discussing the forthcoming op~\
can be undertaken.
ing during recent years. We are
erations'
of t the
International
In referring to the fundamentals Bank for
of course familiar by this time
Reconstruction and De¬
with the degree to which many of United States foreign economic
velopment, Eugene Meyer, Presi¬
of
our
postwar measures after policy the Director of War Mo¬ dent of the
Bank, according to a
World War I ultimately contrib¬ bilization and Reconversion in his
special dispatch from Washington *
uted to the sharp decline in world report of July 1, 1945, summed up to the
N.ew York "Times" on Oct.
trade and to the breakdown of these objectives as follows: "We
lift
their
national
-
Meyer Discusses
,
,
<
World Bank Plans
the international
exchange system
into
ten
the
master
Lend-Lease
agreements beginning with the
Anglo-American
Agreement, of
In these
February, 1942.
it
ments
was
provided
determination
final
agree¬
that
of the
the
bene¬
want
and
consumers
our
nesses
sell in
"to the
and
on
settlements directed
expansion by appropriate
31;
busi¬
secure
Only in this
way can
the most efficient
of division of labor among
use
not
nations
promoting
that:
the
"The
be an
world
in
the
immediate
quirements
ments
of
of
stability, Mr. Vin¬
report declared
United States can not
same
that he had
island of stability in a sea
no
back,' he said^
tory
designed for the realization of the
greatest advantages of mutually
beneficial exchange and coopera¬
nications
of
tariffs
riers."
and
in
international
the reduction
other
trade
bar¬
This is, in effect, an enun¬
ciation of
policy which would
aim at all times at the develop¬
a
<
seg- •
com-
•
intention of being
•
"3.
loans
.
regarding
thus
far
•
-
Applications
and
commu¬
prospective f
tion.
:
the
I
Bank would involve an aggregate
credit advance of around $2,000,-
1
received
by
.
Ever since the middle 70s the
United States has experienced a
000,000 over the next few years.
By next May the Bank will have I
about
view to making
virtually unbroken series of an¬
nual merchandise export balances.
^possible for all nations to trade
In the days of mercantilism an ex¬
ment of world trade
mum
it
>
I
secretive about the Bank's, opera- :
tions. 'We haven't a thing to hold li
ican prosperity and cooperation."
In other words, the policy is one
to
'
as
tion of goods," and "to the elim¬
ination of all forms of discrimina¬
and
investment
r
savings banks and ;
insurance; companies.
v
'%
Mr. Meyer stated repeated- •
ly during his: press /conference %
production, employment, Of instability, nor can world sta¬
the exchange and consump¬ bility be achieved without Amer¬
treatment
important
the
munity, such
peace
of
commerce,
future,
probably offer several varieties of securities to meet the re-
After calling attention to our de¬
sire to cooperate with other na¬
in
be
it will
with the rhaximum advantages to
our American standard of living."
tions
emphasized: the) / following: *
•
ppinfs;
"1. When the Bank is ready to
market its securities in the United
States, which he indicated would
markets without dis-
criminatidn.
we
and
to, have the right to buy
level with
a
on
a
maxi¬
text of the proposed loan
agree¬
.
make loans, net
erable
foreign
port balance was always referred
to
a
as
"favorable" balance.
This
trade.
A
"favorable" balance is
not
necessarily good or bad; it de¬
pends entirely on circumstances.
And
the
sooner
we
can
discard
the term from our thinking, the
better.
For many years Great
Britain's import, or -unfavorable'*
/
:
"
including considcurrency,,
and
:
/
without borrowing in the money
term has
persisted to the preSenf
day and has all loo frequently
blurred our thinking about foreign
$718,000,000' in gold and
dollars with which to
American
market"
*
*
,
)
Mr.
Meyer is reported also to
have told the press conference he
was
addressing that he considered
it neither neeeessary nor desirable
>
for the Bank to commence opera*
tions hastily.
/
- :
' :
;
Announcement by Mr. Meyer of
the appointment of Charles
Chip*
The United States has ment with Great Britain in 1945 balance of mercantile trade was a man Pined as director of the Loan
always been a central point in the represented an amplification of direct reflection of that country's Department of /the Bank was
tive operations as residential and network of world trade.
During these principles; They; were ac¬ strong/position as a creditor ha- i hoted in our issue of Ndv. 7; page
other construction, producers' dur¬ the 19 th Century; when we were cepted by the British Government tion.
In other Words, she had 2389.
:
'
t
economy.
billion went into such construc-
*
function
tant
a
to that of
..
During the same year only $9,407
became
War" I,
with each other on a profitable
product was good example of exchange which
basis and to enable debtors to
$197 billion.
Although War ex¬ has undoubtedly benefited both
meet their international obliga¬
penditures began to taper off dtir- countries. It is the broadening of
tions.
ing the second half of the year, this type of base which can mean
the Federal Government's outlays the broadening of markets from
Proposals for World Trade and
accounted for approximately $83 which both we and the rest of the
Employment
billion. In other'.words; the Gdv- world will benefit.
The Proposals of World Trade
ernmertt was such an important
Role of Foreign Trade
and Employment which the United
customer that for carrying on the
It should be noted that foreign States released at the time when
war
it took considerably more
than 40% of what we produced. trade has always been an Impor¬ announcement was made of the
'
States
the T--t—by the volume of dollars availablef :
International Monetary Fund
and the International Bank for to them, it also happens that the'
Reconstruction and Development level of exports follows a trend:
ures
during the second quarter of
that year that we reached our
highest annual rate of output of
approximately $206 billion.
For frontier.
was
-
international and domestic meas¬
trade.
been maintained
should have shifted from
in¬
p
:
'
The Bretton Woods Institutions
more
a
tution
to
course
with our level of do-'
mestlc business activity. This closecorrelation ^between imports and
ganization,: It established a Pre^the mdex of industrial production
paratory Committee of 19 coun- ^ °! course readily explained by ;
tries to arrange for the conference Ibe met that a substantial part of
and to prepare a draft charter for our imports consists of raw matesuch: ^organization: v The Pre- "als and semi-fimshed products' «
paratory Committee has recently which are essential to the producbeen in session in London.
tion ?f industrial products in this:
such that later under the Consti¬
State
■
'' ;
that from the moment the United-
during World War I produced cer¬
tain changes in the balance of in¬ resolution
calling for an internaternational payments, yet it did tional conference on trade and
not alter the interdependence be-:
employment to consider the creatween domestic output and world lion of an International Trade Or-
economic
that
governments,
imported.
Foreign Trade Important
It has of
^
in
it
Level of
In February of • this year thd
Economic and Social Council 0f
the
United
Nations
adopted ; a
son
to
uets which - were
.
The shift of
and
boundaries
other
cluding those of Great Britain and
output, American agriculture, re-, France, have indicated their-ac- an over-simplification. • At any'•
lied on foreign markets, for , the ceptance of 4he
proposals in prin¬ rate, the issue is not particularly:
sale of a very large proportion,.of ciple >and their,
willingness to e©; v-l pertinent to our discussion at theour production of cotton, ^wheat,
operate with this country in work- i moment, dt is not the size of the*
tobacco and certain other.prod- ing towards their,
general inter-- balance, whether it be on" the ex-'
ucts.
"
national adoption.
: - -[port or the import side; that is im-
be based
saw
abroad
of,'.merchandise' which - she c&uld fa
'transmitted
obligations^in tices-intergovernmental commode
our
fits of wartime mutual aid was to
map
we
were
gestions for rules to govern trade
barriers, restrictive business prac¬
by a line of a certain
Our experiences under the
Articles of Confederation were
a
color.
had in the United States
the greatest unrestricted market
in the world. Our relatively high
standard of living has in large
part been derived from this fact.
There is nothing mysterious about
goods and services: just because
they may wish to cross a national
output figures
recent pe¬
note what happened
a
can
have long
national
With those of
we
find them; they are not confined
to some limited area marked off
riers
We can best illustrate the nature
of this problem by comparing our
.
wartime
Markets are wherever
on
income
of
sources
large part through the exports of ity arrangements, and the inter¬
cotton, Wheat and other products. national aspects of domestic em¬
Cur creditors were among the ployment
policies and outlined a
principal markets for American suggested «tructure for the inter¬
goods. Even though our exports national ^Trade Organization it-
that the period, of destruction may in terms of maximum rather than during the early 30s. With a view
be terminated as soon as possible. minimum market possibilities, and to guarding against a similar set¬
Since in time of conflict a large to keep our production budgets tlement after World War II certain
proportion of output is' directed geared accordingly. In fact, it is fundamental principles were writ¬
towards the prosecution of war,
the part that is available to serve
basjs for later discussion and
•:
than tho&afleriwed^
,y
:
production and exchange to- $105 billion.
gether
with a
correspondingly
Civilian Production Offsetting
high level of unemployment. Be¬
Loss in War Output
ginning with the Lend-Lease arBy the second-quarter of 1946
rangements in 1941 every effort
has been made, to have the ulti¬ these figures showed some very
Al¬
mate settlement macte in a man¬ significant; developments.
though the rate of gross national
ner consistent with; the principles
.
^•Thursday,, November 21, 1946'
abroad,
heavily
while private borrowing
of
'
'^-,'ti,., 1 <w*Ja>
the to other Governments for their draw upon in paying for the food
approximately payment of interest and, dividends consideration: They contained sug¬ and raw materials and other prod-
able equipment, etc.,
(Continued from page 2608)"
dUjit«w/-JM.VX
•
;
*
; /.
1.
-I
•
♦
*,
*
«-x
i
• a
•■>*>%
.1
•.£
v
^ A A* v *,'•
,r*
"i».•?r- * •** &
.t.s\X\JZ*.
.
«.'t i?' »./»>
\
V
V'''-
i'.-'
'Volume
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4544
164
"■ 'J-
•'.A
direct political action by a class-
Restoring Equality in Collective Bargaining
>
contributor
best
•
¥$)
vidual
industrial
to
;<.?
peace.
True collective bargaining,
nist
arbitrator* The
next judge or arbitrator who held
different personal convictions
(Continued from page 2611)
judge
would be free to make a different
un-
the
upon
the same state of
circumstances 'id
facts. Justice and a workable sys¬
meaning, has not
tem Of law can never result from
:yet been honestly tried as the
decisions on matters-of principle
meat s of preventing the excessive
based on the personal whims and
growth of labor strife. True col-'
prejudices of the individual who
t-E lective bargaining is imposs ble
at the moment to be
V' when government sits at the bar¬ happens
gaining table on labor's side. True charged with the duty of decision.
1
der
the
award
only
^
;
;
t'
'
No
t/.-t''
'
7
;
bargaining is impossible
when labor is given legal, political, and economic weapons which
are denied to employers.
"
.
'v
•.
'•* J
•
..
.
Agreement on Basic
General
Rules Exists Today
•
themselves
''Communists"
convinced
ment.
The important issues in the cur¬
rent
ma j or
labor, disputes are
tJritil true collective bargainingf
without y exception issues which
i
hasbeenfairly tested, no sincere
cannot be solved by any formula
believer in private enterprise and
or standard upon which manage¬
in democratic
liberty can honment
or
labor would generally
es'.ly advocate the passing of new
agree.
>
laws imposing novel restraints on
For example^ you cannot 'for¬
employers or employees, or vest¬
ing ne\v powers jn a bureaucracy^ mulate any rule or standard set¬
'/■"V X,
'ifV- ,4'v
/' ;;'\l
ting forth the circumstances under
v*., Fair Adjudication of Labor Dis¬ which a general wage increase
putes Impossible Without For¬
or r decrease
should • be
given,
At
-
•
the
on
one
■
.
v
a
'*■; [■ i
V: 'H
Wards,; we have dealt with
CIO: international,
the United
Retail, Wholesale, and Depart¬
ment Store Employees of Amer¬
ica, which has furnished several
of
the
leaders
the
of
"anti-Communist"
the
ClOi..
so-called
within
at least
groups
,
Nevertheless,
Historic
Goals
of
Organized
Labor Are Incompatible With
the
a
Success
.'
of
"
'
••
r!
•
mulated
•
Rules
Basic
which organized labor and
management will substantially
agree.
The fact is that the for¬
upon
Collective ^bargaining under the
best circumstances will obviously
not eliminate all strikes nor pro¬
vide a substitute for them. The
;
•
]
<
be solved by .turning
•
battle into
.
v.
.
,
vanced.
the economic
contest before some
If you cannot secure universal
or
After
the feud.
;
-■■'•V'
glib plausibility of this ar~
The
"
gument conceals both its
•
plan
should be
adopted, or an incentive wage
olan eliminated, or a work week
shortened, r or: a
benefit fund
annual
-
difficul-
|| ties and its"dangers.^^The judicial
i
nrncess
-is., essentially: the
wage
created.
ascer-
r
■
.
..
4
tainment' of facts, and the appliAn arbitrator today consequent¬
cation- to- these facts of a previ- ly has no universally accepted
•
'
1
ously formulated rule with which
parties were or. could have
been acquainted* The duty of the
judge, once, the facts are found or
; agreed upon, is to. apply the existing rules, not to make new ones,
and the judge should refuse to
^ allow personal preferences or be; liefs to influence the result. Unthe
standards to
guide him in decid¬
of the major issues which
are
causing
destructive strikes.
His decisions are necessarily arbi¬
trary ' and ^the reflection of his
ing
,
? by
I
unfairness
the
He
bias.
be
cannot
the
conscious
inherent | in
and
bor
management
be
cannot
particular cases without stances when the dispute is purely
referehce to general rules or prin- cne of fact and the principle to be
ciples, law becomes personal and applied has been agreed upon, the
arbitrary, and ceases to command ; device of arbitration is simply the
■rj. the respect which alone can make surrender to an outsider, not re¬
1 it ultimately effective.
sponsible for the success or failure
to decide
r
"
of the
Before you can
-
<
•'
1
.
<
■j..
:
.• (•{■
;
.
either have reached a gen-
this postulate. be?
apparent as soon as we turnto specific cases;' Whence
ample; should a labor union be
awarded the closed shop?
If you
believe as I do in private enter-
major
ideology
of
it is
as
under
the
be
This
y
.
'
•
lack
of
on
I;
reason
4'
agreement upon
A
is that the economic
facts
>
-
'
!
■v" b<?
imposed, this major premise
.would
be
no
more
than
personal conviction of
purely
the indi¬
factional
of
between those
disputes
who
follow the gospel of Marx
according to Stalin and those who
assert their right to interpret "Das
Kapital" according to their own
consciences.
cripple the effi¬
private enterprise by
on ' production.
' The
of
restraints
.
labor
has
movement
historically
opposed, and continues generally
to oppose, the adoption or effec¬
tive
of
use
vices
of
the
which
labor-saving de¬
reduce
employees.
ment
has
the
number
the
Communists
stems
on
from
no
continues
of
...
;
"People who merely support
.an ideology of Communi$m do
Communism,
Socialism,;
something else, are enemies
private enterprise with
basic.agreement is possible.
or
craft
tion
of
practices disruptive of
discipline. The goals im¬
plicit in all these demands of or¬
ganized labor are incompatible
plant
with
the
goals of private enter¬
prise.
Individual
unions
may
have
making of one or
types of restrictive
demands; but I know of no union
the
of these
more
to
has
limit
fined
forsworn
At
an
in
consistent
to
with
hundred
the
meeting,
presence
of several
listeners, I asked one of
best-known
leaders
of labor,
labeled everywhere in the press as
"right-winger," whether he be¬
lieved that pickets should be per¬
mitted to use physical force to
stop production workers from en¬
tering a struck plant. With com¬
plete frankness he answered, "I
a
would feel derelict in my duty as
a labor leader if I
permitted them
economic
the
need
The
:
,
this
of union demand or of the
lishment
of
type
governmental
a
ma¬
chinery by which these restraints
might be imposed would be to
make ;
impossible
eventual
the
survival
of
success
or
private
The nationalization of
any
industries today
politically feasible
in
large measure by the ineffi¬
ciency-resulting from restraints
production imposed by organ¬
or adopted by manage¬
forgetful of the reason-forheing of the private enterprise
system.
on
ized labor
ments
Mutual
and good will
merely conceal: the
conflicts
toler¬
at best
irreconcila¬
can
between
the
the
beliefs
and goals of the leaders of organ¬
ized labor and
the beliefs
and
plant.
strike is war."
To
But
it is
not
necessary
to pin
the label of "Marxist" upon a la¬
bor leader to prove that what he
ards which would be necessary to
the
impartial 1 adjudication
of
labor
disputes.
Here
lurks
one
of
the
great
dangers inherent in all proposals
pseudo-judicial solutions of
the labor problem* No compulsory
for
arbitration
law
could
be
word ^"Communist"
of
the
simoly
labor
a
in
the
movement
argot
ness
with which he is dealing be
passed
today which expressly prohibited
the award of any of these re¬
straints upon production. In the
absence of such an express prohi¬
bition, a compulsory arbitration
statute would be simply a device
declared
a
public utility and be
operated by the government, and
the labor leader
who, like the late
Sidney Hillman, asserts that
means
planned
and
member of the Commu¬
ernment
officials elected through
by
advocates
could claim
vate
gov¬
of
socialization
convincingly that pri¬
enterprise had failed,
v.
.
■
-
Labor Tribunals A Further In¬
crease
pro¬
duction and employment must be
controlled
the
But
even
administrative
some
labor court
tribunal
would
in
many
unbalance addi¬
ways
prices down with barely tolerable
efficiency; but its destructive in¬
terference
the
with
of
end
strated
production
the
the
has
war
high
a
since
demon¬
foolishness
hoping for
living in a
of
ever
of
standard
governmentally-con1•
trolled economy.
The
convincing argument
attacking the labor
problem by reliance upon col¬
lective bargaining and a restored
balance of bargaining power is
the fact that this approach would
require the minimum amount of
in
most
favor
of
.
interference.
governmental
As
the representatives of private en¬
terprise,
seek
a
we should be the last to
solution of our problems by
enacting new laws, by giving our
already
overgrown
government
new
powers and responsibilities,
or by inviting the aid of bureau¬
crats in the
handling of
problems.-
ness
v
•
y'-V
-
•*
--
busi¬
our
:
.'J.'---'
—L:'
■■
:>
1 •
Life Ins. Purchases
could
Life insurance purchases in the
United
States
showed
in
increase
an
purchases
in
September
of
71%
over
the
corresponding
70%
over
the aggregate reported for
September in pre-war 1941, it
month of last year and were
reported
was
Life
on
Oct. 21
by
the
Insurance
Agency Manage¬
mentAssociation '. of
Hartford,
Conn,. Total purchases in Septem¬
ber
$1,710,536,000 compared
$1,001,268,000 in September
year and $1,004,365,000 in
September, 1941. The Institute's
announcement also had the fol¬
were
with
of
last
lowing to say:
Purchases
of ordinary life ifln
September were $1,125,829,000, up 65% over Septem¬
ber,; a year ago and nearly twice
the total in September, 1941., In¬
dustrial life insurance purchased
in September amounted to $346,in
116,000, an increase of 56% over
the corresponding month last year
and
33%
1941.
September,
over
Group life insurance purchases in
September
times
two and
were
those
t
of
1
one-half
last
September
and 47% over those in Sep¬
year
tember,
1941. U. These , purchases
represent new groups set up' and
do not include additions of in¬
sured
personnel under group in¬
contracts already in force.
surance
In the first nine months
of the
insurance ;, pur¬
$15,935,016,000, an in¬
total: life
year
chases
were
crease
of 55%
the first nine
over
months of 1945 and 90% over
the
of
1941.
Purchases of ordinary life
insur¬
corresponding
period
accounted for
ance
$11,501,791,000
aggregate, an
of the nine months'
increase of 62% over last year
well
over
dustrial
life
represented
current
30%
as
insurance
purchases
$2,989,585,000 of the
year's total, an increase of
compared with last year,
while" group
life insurance pur¬
increase
$1,443,640,000,
of 61%
an
be
with the first nine
year.
and
twice the 1941 total. In¬
or
established which would function
J
Up 71% in Sept.
chases amounted to
in Bureaucracy
if
forces
area
adjusting
tional aspects of the social struc¬
ture. Price control for a time held
surance
acquaintaince,
ance,
ble
economic
unforeseen
estab¬
Remember, a goals of the men who manage pri¬
vate enterprise.
In the face of
preach the use
of violence to prevent employees such irreconcilable conflicts, only
from working against the wishes explicit statutory enactment could
of a labor union is to preach th£ establish the basic rules or stand¬
to enter
the former would immeas¬
for the
inevitable result either of
general surrender to
a
con¬
issues
efficient4crea¬
more
has been made
off-the-record
ex¬
urably enlarge the tasks of gov¬
ernment, stimulate the growth of
bureaucracy, and enclose within
attempts
tion of material wealth.
of enterprise.
major English
the
all
production and has
itself
..
but
distinctions
necessarily multiply the
man-hours required to produce a
particular item, and the imposi¬
the foreign
.
workers
require, the
which
greater and
as
"Quislings" who are "enslaved to
policy of the Soviet
Union," but adds;
move¬
output, the
more
methods
newer
he
"Communists"
better
of
which
condemns
labor
to
for
employment
James
Carey, national secretary of the
CIO, the avowed leader of the at¬
tack, in effect admits this when
love for private enterprise.
The
historically
demanded,
demand, ever
shorter work weeks, the reward¬
ing of seniority over ability and
performance, the elimination of
and
forsworn
The truth is that the attack
the
labor disputes by man-man rules
instead of
by the interplay of
ciency
r
enterprise will be and must be de¬
However, if the parties had not stroyed. A very large number of
agreed in advance to this major labor leaders today are Marxists.
premise, or if the statutory law We must not be deceived by the
did not prescribe the conditions current drive against "Commu¬
under which a closed shop should nists"
in
organized ; labor.
The
,
the ranks of labor is the echo
minimize
government intervention,
of freedom. The effect of
widely in the techniques they em¬
ploy and in the demands they ad¬ believes is incompatible with our
vance.
Nevertheless, businessmen basic political and economic be¬
dangerously deceive themselves liefs. The labor leader who, like
John L. Lewis, calls a strike in
whenever personal respect or lik¬
ing for individual labor leaders, the knowledge that the govern¬
for fastening one after another of
or
pleasure in some temporary ment will thereupon seize the
alliance, leads to lesser vigilance strike-bound enterprise and con¬ these shackles upon private enter¬
in defense of the prerequisites of cede his demands, and the labor prise, until the day arrived when
private enterprise.
i ;;- leader who, like Helstein of the private enterprise could no longer
function with sufficient effective¬
Workers'
Union,
If. the labor leader is at heart a Packinghouse
ness
to justify its existence, and
Marxist, he believes that private publicly demands that the busi¬
major premise would
implicit in the award.
•
all
similar to< those of the particular
case.
.>",■%?
Labor leaders obviously do not
think alike; they also differ
■
hy a'labor court or- board of arr
bitration would reflect the conviction of the judge or arbitrators
that the closed shop should be im-
least
Whether this label be tech¬
nically accurate or not, much of
,
But Sn award of the closed shop
at
"Trotsky-
of
the field of the law another
retention
of
tent
,
would
course
to seek-to
the
work
loaded
seemingly inevi¬
tendency of the labor move¬
than
political beliefs of many labor defiance of law which is revolu¬
leaders, and the goals implicit in tion; and to speak of a strike as
warfare
many of the demands which other
justifying revolutionary
labor leaders! advance, are incom¬ violence is tq preach the class war
patible with the philosophy and proclaimed by Marx and Engels
in the "Communist Manifesto."
goals of private enterprise.
prise as the best means * of improving our standard of living,
the answer is "never." The prin-
posed,
the
through
table
the
and
comes
'
"
to
as
-v
No General Agreement
This
•
or/abandoned./1^-'1;;^;'.;
;■
-
basic formulae is not fortuitous.
-
'■'*
•
Basic Rules ls Possible
>::'y mise; they must either be upheld
t >;•/,
\
*
Why
on
based
&
'v
•; •
ciples upon' which this answer is
do not admit; of eompror
•
it, the decision;
how-the business shall be run.
''
universally acceptahle basie rules, ' or you .must
explicitly prescribe those rules in
the statute creating-the;ftribunal
i
business, and often not inti¬
With,
mate
The. truth of
v
ites."
as
warfare
ment
seizure,
it
1
<
strike
effort to mini¬
an
the historic and
condemned
"Daily .Worker"
as
brought to an approxi¬
equality by being deprived
weapons.
The latter
while
of the labor leaders
re¬
solution would be
a
industrial
organized labor and the defenders
private enterprise is not so
voke
government
desirable
mize
mate
of
some
and
destructive
groups
Enterprise
incentives
a
whether such
of
much
impartiality
straints, the question still remains
Perhaps
the
most
important
reason why no basic
agreement on
rules is today possible between
Party." When this union struck
against Wards in wartime to pro¬
bgy of Marxism, whether you call
'
must
secretary
of the Marxist "Socialist Workers'
For! this reason^ the major con¬
troversies between organized la^
•
r
state
People who-support^ theiicfeol-
post facto
j eral agreement
is
Wards
rules.
formulated
have a fair and
i workable procedure for the adt
J judication of labor disputes, you
.
against
little harm,"
legislation. If the solved today * by voluntary arbi¬
^ judge is permitted to formulate tration, ~ unless management is
new rules
to. conform with his prepared to sacrifice principle for
; personal. beliefs or prejudices, > or
expediency. Except in those inrejc
ist; and the attorney who has cus¬
tomarily represented this union
"impartial"^^ ih^^ the sense of hiiper^
decision is tainted
in advance, the
Vice-President
convinced Marx¬
a
sonally applying established basic
.
less the rule has been
any
individual
,
of this union is
the noise in the current battle in
administrative tri¬ agreement on a formula to estab¬
all,a submission tto lish a "fair" wa?e scale for all em¬
"the judicial process has been the ployees, you will be equally un¬
historic way. in which theirule able to - secure an agreement on
of law has replaced self-help and the circumstances under which an
labor court
bunal?
{
a
time
to
publicity, such' as sup¬
posed .ability to pay, are almost
always tailor-made to fit an im¬
mediate situation, and are aban¬
doned as freely as they are ad¬
example; can*t the labor problem
.
from time
receive
question may fairly be asked:
Aren't there other possible solutions of the labor problem?
For
•
-
which
mulae
International
one
tolerable
collective bargaining between two
Private
.
-r
with
without imposing
as
The
and
thoroughgoing Marxists. Nothing
is more dangerous than to assume
that those who today attack "Com¬
munists" within their union, and
who are in consequence unthink¬
ingly labeled "right-wingers," are
ipso facto believers in private en¬
terprise or in our form of gov-
•
collective
at most,
or,
attack
are
which it has any
■
Party,
who
identifies himself with the Party
by close adherence to the Party
line. ■ But" man^ of the leaders of
or
conscious
labor
movement, are
the proven enemies of private en¬
terprise. -•■••. - v
v..
.• - "
2639
as
compared
months of last
THE COMMERCIAL & FINANCIAL CHRONICLE
2640
/
Thursday, November 21, 1946
balance of payments position the
are that we just cannot af¬
Outlook for Austria's Reconstruction
(Continued from tfage 2604)
control could, in the last years be¬
•
Hitler's
fore
invasion,
be
so
loosened
that, for practical pur¬
poses,
freedom of foreign ex¬
change transactions was nearly
ford to import anything but basic
The
token
import
being, because the in¬ necessities.
is terpretation of the Potsdam pro¬ agreement made this year with
hampered in its development, to visions has not been agreed upon the U. S. A. by the British Gov¬
a serious degree, by the division
among the allies, and we there- ernment indicates our willingness
of the country into four zones of fore do not know what
part of our to open the door again to non¬
occupation, the burden of occupa¬ industrial apparatus and of agri¬ essential manufactured
goods
in favor of countries which have
continues in
suffered severely from the war and
its consequences, have been pre¬
because the Austrian economy
pared
on a
broad scale.
Field
The Economic
In
At that time the at¬
established.
the
economic
it must
field
drawn
be further noted that in two im¬
by the fact that Austria was able
to return to freedom in foreign
portant fields, in the meantime, a
considerable
development
has
exchange transactions: an achieve¬
a
comparable degree
tion costs, and the limitation of
the authority of the Austrian gov¬
ernment in its development.
We
taken place in
the world was
tention of
ment which many
richer countries
were not able to accomplish.
These facts are convincing proof
that the Austrian population has
shown itself, in economic matters,
to be capable of action and very
adjustable;
and that therefore,
despite the enormous losses dur¬
ing the first world war, and after
its end,, it ; was possible to bring
the economy again up to an im¬
pressive level. To be sure, the
standard of living in Austria in
the period before Austria's inva¬
sion was not comparable with the
average standard of living of the
rich countries. Nevertheless, the
living Standard in Austria was in
general
endurable.
Unemploy¬
ment, which was indeed a source
of deep concern^ was to be at¬
tributed, in considerable part, to
the blocking measures adopted by
the German * Reich for political
reasons against Austria.
Problem More Difficult Now
If
we
situation
Austria
of
economic
the
compare
at
present
that
with
prevailing before the
second World War, it is clear that
the disappearance of commodities
is this time incom¬
from Austria
parably greater than it was then.
Particularly those parts of Aus¬
tria which served immediately as
battle fields, suffered, during and
after the war, disproportionately
more than they did as p result of
the impoverishment experienced
The prob¬
lem is this time much more diffi¬
in the first world war.
The situation
cult than last time.
has
been
made enormously more
difficult by the
further fact that
frightful misery prevails in such
wide areas of the rest of Europe,
and that only very few European
areas
able
were
maintain
to
a
of
standard
living which corre¬
sponds approximately to that of
the pre-war period.
Favorable
there
But
are
Elements
In
the
field
of oil production,
production figures,
expressed in thousands of tons,
were:
1937,
33; 1944, 1,213; and
in the year 1945, despite inactivity
lasting for months, 453. At the
present time the monthly deliver¬
the
Austrian
ies
amount
80
around
to
to
90
thousand tons. As the result of the
of
opening
these
important
of energy, Austria is even
in much smaller degree de¬
sources
now
pendent
coal imports from
upon
abroad
than
it
was
previously.
Moreover, the opening up of still
more far-reaching sources of en¬
ergy
both through the use of
water power and through the pro¬
ele¬
ments to be mentioned which are
favorable
more
the
at
present
time than they were
after the first
these I in¬
clude, on the moral side, the at¬
world
Among
war.
have
been
able to
the
use
will
decline
considerably.
very
We shall export to an increasing
extent and thereby be able to im¬
by
port,
our
own
-
strength,
con¬
goods and the other ob¬
jects that we need. No doubt our
sumer
industrial apparatus,
from which
much material has been taken
by the events of the war and their
so
consequences, will again require
investments. This applies es¬
new
pecially to the eastern parts of
Austria, which were most exposed
to the horrors of war.
The
calculation
the
of
amount
of money which Austria needs for
its reconstruction' requires compu¬
tations which
can
hardly be made,
duction of crude oil has been pre¬
requires only
a
sources
of energy
planned continu¬
The
now
at hand.
With respect to the
development of productive sources
of energy the future provides en¬
couraging vistas.,
Of
course
the
external
condi¬
tions must first be established, in
order that the possible evolution
may become a real one.
Since
spring of 1945, despite the division
of
Austria
tion
into
of occupa¬
zones
indebtedness in
the
by
possible at the end of 1945
the schilling again, as a
distinctive Austrian currency unit,
in place of the Reichsmark, which
was
put
unmeasured
quantities; trade
abroad, despite great ob¬
stacles, has been started again
even though on the smallest scale.
with
a
come
a
fact.
current
on
exports have
panded sufficiently to pay in full
is
now
> debtor
nation instead of a
creditor. No longer is she in a
position to grant large, long-term
■a
loans. Instead she herself is faced
with
an
been
do
estimated
no
more
that
than
of
Britain
of
volume
a
in
order
to>
simply regain
standards
pre-war
abroad
payments prob¬
magnitude. It has
overseas
lem of the first
living the
must
of
goods
send
75%
in
of these areas toward Aus¬
tria, and the lack of knowledge
the
more
remote outer
world often found itself with res¬
conditions and
Austrian
pect
to
their
causes.
fortunately,
At the present time,
a
dislike such
as pre¬
vailed in the earlier
period is not
longer to be found, or is to be
found
only in certain of the
neighboring territories. In general
there is an awareness that Austria,
with
its mentality in favor of
uniting peoples, was the first sac¬
energetic
use
1945, in all calmness, and
an
Aus¬
trian government was set up, on
the basis of these elections, in the
Hitler, their participation in the
war
from
arose
compulsion
own
and
remorseless
a
not
desires. In the
from
more
their
remote
foreign countries people are cer¬
tainly today incomparably better
informed about conditions in Aus¬
tria than they were at the
begin¬
ning Of the 20's. The presence of
the armies of occupation, for such
a long time, on our
territory is it¬
self providing a more intimate
knowledge of our country and its
population.
Moreover, attention
should be called to the fact that
the* relief
measures
which
were
undertaken
after the first world
war
improvised,
were
whereas
this time the relief contributions
fraction
im¬
Britain's
of
ports today come within the "ne¬
cessities" class — food, raw ma¬
six months of this year,
of every
pound's worth of goods im¬
German Nazi regime, taken with ported, ten shillings represented'
food and drink; seven shillings:
violence and fraud, are to be re¬
and
industrial
garded as null and void, it fol¬ raw materials
one
cannot equipment; one shilling and six?
to pence petrol; one shilling tobacco
reparations from Germany, but and the remaining sixpence accounted for all the rest.
O
are to be returned to the Austrian
As long as our present difficul¬
economy. Only whep full clarity
is established on this point will ties persist the British Govern¬
lows
be
it
that
the
turned
be
properties
claimants
to
over
possible
to set up a clear
calculation.
Neverthe¬
•
ment is therefore forced to exer¬
cise
a far more
rigid control on
less, the Austrian government is the import side than is the case
in the process of determining how with exports, and a large amount
high the most pressing capital of Britain's import business is now V
needs for the rebuilding of the conducted on government account.
Foodstuffs for example are mainly
economy of Austria will be, if a
correct interpretation of the Pots¬ purchased by the government and
raw materials largely
dam decisions will be assured.
so. There
is, however, a vast range of com¬
economic
Kingdom
imported into the United
by the private trader,
to the issue of im¬
but subject
port licenses.
-;-,y In
the
of
case
markets in
pri¬
products the government is
examining each case on its merits.
With cotton, for example, it was
mary
decided
continue
facilitate the movement of goods
to overseas markets, it is the gov¬
I
bulk
;:
chasing; in the
ernment's
aim
lift
to
the
war¬
The emphasis in Britain then is
exports.
The quantities of
goods available to our -domestic
consumers
are
slowly
rising,
though we still have to maintain
rationing of clothing and a prior¬
ity system of distributing some
other scarce goods. As far as over¬
on
—
which
still
are
so scarce
ensure a
fair dis¬
time practice of allocating avail¬
able supplies, on a country basis,
by
the
International
Emergency
European
Coal Board. In addition, certain
essential goods in short supply
are; still Subject to some form of
market allocation.
The system of
allocating a specific quantity of
such
commodities; to, countries
wholly or mainly dependent on
the U.K. for supplies was devel¬
oped duirfng the war. It still applies
to certain goods — tyres, for exam¬
ple—but on a rapidly diminishing
scale, for it is the policy of the
government to free the export
Council
Food
trade
as
and
much
as
the
possible,
vided such freedom does not
with
flict
the
a
fair
countries
short
supply.
con¬
distribution
most
commodities
those
pro¬
in
which
Then
to
need
of
in
are
there
are
Britain's contributions of relief and
rehabilitation
all
are
under
the
control
of four occupying powers, and in
each Zone of occupation the mili¬
tary power claims
significance,
of Austria had
garded
as
legitimate
German
property. If these measures of the
measures
of
many sons
minute
took terials, technical equipment. It has
re¬ been estimated that, over the first
is hampered, at the
present time, by the fact that its
fectiveness
to shed their blood in the armies
that, if
;
be
supplies to liberated
chemicals, areas and also shipments to Brit¬
ish troops abroad. Together these
rayon,
electrical goods, cutlery
for about 5%
of her
and hardware, nonferrous metals account
and china and earthenware are monthly volume of exports.
strictest accordance "with demo¬
cratic methods. To be sure, its ef¬
jurisdiction
stop be¬
fore Austrian legislation and Aus¬
trian governmental measures. The
rifice to Hitlerite aggression, and
Export Policy
The Austrian popu¬
lation has shown that it is making
in which
felt
regime
tribution throughout the world it
is necessary to continue the war¬
really independent state will be¬
The election to the Austrian Par¬
liament took place, in November
been
Hitler
ex¬
people
For An Independent State
We
many
had
the
away from Austria cannot
that in order to
deficit
our
themselves, unquestionably signi¬ for our purchases overseas.
has been made. It
The result is that Britain
of the democratic
forms which the present demands,
which
which
ac¬
count until
war.
dislike
its reestablish-
ample
run up a
great powers to make Austria
During the
period after the first world war,
there were still remnants of the
upon
to be made good; we will continue
ber
toward Austria.
unanimously
ment will also come to recognize
that
those
Austrian
properties
to
greater than they did before the
areas
-
from
more
to
pur¬
of rubber, as
in the House
sterling area equal in value to five time controls as soon as the sup¬ of Commons, it has been decided
or six times our pre-war
yearly ply position permits. There are of to restore private trade to permit
export income. And not only is course supplies of certain com¬ the re-establishment of, the Lon-,i
there this great back-log of-debt modities
food and coal, for ex¬ don rubber market.
incurred
we
ficant progress
,
stillbuys
Repa¬ the rest of the world than any
rations to be paid by Germany. other country, but our rate of im¬
Austria
is
convinced
that
the port is running at less than 70%
Powers
which
have
decided of the pre-war volume. AH but a
(Continued from first page)
and purchases of war supplies in
almost every quarter of the globe,
able to do so.
are
Britain
case
anounced recently
—
four great powers, and
despite the catastrophic conditions
in which, at the beginning, trans¬
port and personal freedom found
to
when we
economy under the head of
High Wai Cost and British
Foreign Trade Policy
ation and completion of the works
titude of the
of
cultural production mky yet be
withdrawn
from
the
Austrian
modities
confidently hope that the
unanimously expressed will of the
population in a num¬
important
neighboring
for the time
pared for, and the development of
these additional
in
also- some
could
Austria. This ap¬ past Kone and one-half years much
plies first of all to the production more effectively for the starting
of electrical energy through water up of our economy and for the
power.
In Austria 1,628 million production and distribution ol im¬
kilowatts were produced in the portant
consumer
goods if we
year 1937,
whereas in the first were not bound by the above
half year of 1946 alone, 1,275 mil¬ mentioned
impediments.
If we
lion kilowatts were produced in shall again be able to move, our
this way,1
need for help; I have no doubt,
* *
1
could have streamed into Austria
*
facts
a
which does not have to
seas
customers
however,
as
are
exports
*
than half
more
before the
war.
concerned,
of
as
great again
These and other
important groups of exports will
have to do even better than this
if
they
are
decline in
to make
some
for the
up
of the older Brit¬
ish
industries, notably coal and
economic cotton, and if the 75% overall in¬
standpoint,' of the military occu¬ crease is to be achieved and —
from
an
But
the
supply position has
yride range of goods
and many of these have been re¬
moved from the scope of export
licensing.
In
consequence,
the
U.K.
private exporter, through
whom virtually all British export
trade now passes, is free to sell
such goods to whatever market he
eased over
a
pation of Austria is shown more important—maintained. C
chooses. The present poli6y is to
crudely by the fact that of a bank
The government had originally give the individual exporter the
note circulation of S. 5,133 mil¬
maximum
possible freedom to
planned to regain the pre-war
lions, not less than S. 2,605 mil¬ volume of
export by the end of cultivate his own markets in ac¬
lions had to be paid to the occu¬
cordance with his special apti¬
1946, but their brightest hopes
pying powers. It is high time that have
been
exceeded.
In
the tudes.
these, obstacles to our develop¬ second
quarter of this year the
Import Policy
ment should disappear.
volume of British exports rose to
The effects of the war have
within 2% of the pre-war level forced Britain to initiate a great
Relief Needs
The great need for foodstuffs and, despite the effects of the export drive. In the import field
effect has
been equally
and the basic articles of consump¬ holiday months of August and the
tion; raw materials, and means of September, they rose in the third marked but in a different direc¬
tion and, for the present, we are
production has led to large-scale quartet to 4% above the 1938
: in general forced to restrict im¬
relief
activity, especially from volume. 1
Expanding World Trade and Full
Employment
The
But
to
achieve
must reach
America and UNRRA, which have
benefited Austria. The desperate
In order to encourage exporters
in the task of achieving the goal
situation
that
of
Austria
nevertheless
has
;
been: set
them
:
ports
to
bare
essentials.
It
is
a
policy which is directly contrary
and: tor to pur: desires; but owing: to: our
a
she
equilibrium
75% increase in ex¬
ports, which means that on a pre*
war basis nearly one third of total
world exports of- manufactured
goods must be hers. This is mani¬
festly impossible; before the war
her export trade in manufactures
was
about. 18% of that of the
whole world.
The solution, then, lies in an
expansion of world trade. Britain
has
a
vital interest in the success¬
ful solution of the
being
discussed
problems now
at the Interna¬
tional Trade Talks in London. If
the channels of international trade
can
be cleared of restrictions, if a
high and stable level of demand
for goods and services can be;
ensured, if exchange stability can
be maintained, if, in a word, the
total trade of the world can be
greatly .increased,
can
then
Britain
achieve the volume of exports
fulland
thereby contribute her full share,
both as producer and consumer, to
the raising of living standards at
home and throughout the world.
she
requires to
scale
volume
pay for a
of
imports
The maintenance of full em-;
ployment is a vital element in the
policy of the British Government;
but we believe that that obj ective
in any one country may well be
frustrated unless all other major
industrial and trading nations^are
likewise maintaining full
ment
without
.
.
Britain approaches
nearer
equilibrium in her balance of
payments the greater will be her
ability to purchase an increasing :
quantity of goods from abroad.
ployment.
that
unless
exporting
employ¬
unem¬
Further, we believe
adequate steps are
.
international ac¬
tion in this field, the results hoped
for from the reduction of trade
barriers will nott be fulfilled;
equally we hold that without the
reduction of trade barriers; full
taken to ensure
employment
will not make its:
maximum contribution
s+^ards of living
to raising
throughout the
world::: •:■. -: .-:v
••
'•
'.Volume 164
THE COMMERCIAL' & FINANCIAL CHRONICLE
' Number 4544
I 2641
constantly
Marketing Outlook in 1947
turbed
and
(Continued from page 2607) > a set-back;: during this second should be able to keep most of our
rely to some extent on statistics postwar period,
but if it should productive capacity busy, furnish
and facts in presenting to you
my occur, it need, not be either severe jobs for a very hign percentage of
concept of the outlook for business or prolonged.: There are too many our people, and prevent a serious
from
the
standpoint of distribu¬
tion and marketing.
But before I
start talking . about the future, I
would like to review briefly with
favorable factors in the picture to
business recession.
justify the forecast of
long-lasting decline.
then, will be to maintain
sharp and
Money in
circulation is at a new all-time
you some of the. events of the past high.
Millions of families have
and to take a good,, hard look at moved into higher income brack¬
the present.
ets.
Average family income, after
•>:A ,s'/\v
'A v A' ,l '•
7*£' 'A taxes
and basic living* costs,
is
Division of Postwar Era
higher than before the war and is
During the war, we mentally well ahead of price increases in
divided
the
postwar
era
into such products as durable goods.
three parts: the period of recon¬ Savings are still at a very high
And we have only just
version, the period of catching level.
up with accumulated demand and just begun to fill the backlog of
the period of self-sustaining econ¬ needed and wanted products and
omy.
We have passed through services.
a
.
.
the first of these periods in such
an amazingly short time that we
have exceeded the fondest dreams
Surely the outlook for business
could not be
more
favorable from
a,marketing standpoint.
To make
it is necessary to
of many of our economists. J The
whole world looked on in aston¬
the most of it,
ishment 1as
American industry
ibegan turning out the products of
ing excessive, to increase produc¬
becom¬
prevent inventories from
man-hour, to keep costs
and to see that
weeks after the
paces are ho higher than they
war
were
pouring
need
to
be.
Otherwise, even
soever-ending stream.
;
though incomes have risen faster
We are now in the early stages than prices, goods will become too
of the second postwar period, that high for the consumer's pocketof catching up with accumulated book.
The real danger is not that
demand.
A year ago, pessimists we may exhaust our backlog of
were predicting that the
.cancella¬ needs or that buying power may
tion ofwar contracts and the rapid collapse, but that the price struc¬
demobilization of the armed forces ture may become so inflated that
would result in ten million un¬ a swift and disorderly downward
employed and a widespread, de¬ readjustment may occur. Indeed,
pression in 1946.
Contrary to I believe that we have much more
their opinions, this did not "hap¬ to fear from a rapid acceleration
pen, u National income payments of the present boom trend and a
to individuals are now at the all- subsequent rapid deflation than
only
jpeace
a
few hours
days
products of
forth in a
•or
time
high
rate
of
or
$167 billion
a
Fifty-seven million people
year.
employed, which is eight mil¬
lion more than in any other peace¬
time year. As a matter of fact, we
have already reached and passed
the postwar goals of even the most
optimistic, economists.
are
But
tivity
as
per
low as possible
that we are* in for a "boom and
bust" period in 1947.
This time,
they may be more nearly correct,
not because supply will catch up
with
demand,
creased
but
man-hour production may
force retail prices temporarily to
such
shall
suc¬
crying need today is
production.
Anything that
will
drop
prices
below their proper levels
were
above them.
But
producing
goods efficiently; the kind of en¬
vironment
which
that
to
cessful
business
has
and how
operate;
suc¬
aggressively at
devise
we
have all of the
frontiers"
we can
that
large
would/ still
prices * could
be
so
quickly
recover.
Backlogs
has
There
been
lot
a
of
talk
lately about the size of the back¬
logs on which we /are depending
will leave in its wake lower
tional income and extensive
employment.
But
such
na¬
un¬
standard of living in this
country of
ours was the
the world
before the
highest in
war
and
is
higher.
Our production ca¬
pacity was substantially increased
during the war years to provide
now
the armed forces with the
rials
it
so
can
essential to victory.
be used to turn out
goods to reduce
mate¬
words, we have
ing
more
more
more
goods.
And
here, if
we
demanding
we
have
the
have the wisdom
and the skill to make the best
of them.
.
.
.
,
certain that
wre
use
V
filled
durable
of
in
line
one
industry
goods
after
are
another,
start> filling
will
the
smaller,
backlog
but
vitally important,
of
nondurable goods.
And we must not forget that back¬
logs exist in services, too, such as
transportation, recreation, medical
care, hotels and communications.
From
this
picture it is
that the nation
into
enter
period,
that
the
as a
easy
new
whole will
third
postwar
of
a
self-sustaining
definite day or,
definite year. The
transition will come industry by
industry qnd line by line. It mav
take many years before EVERY
business Will be in this period.
But, no matter when it
comes, it
will mark the beginning of a crit¬
ical
era
in the history of
our
economy,
on
indeed, in
country.
Since
any
any
•
perfection.
war
I
handle for many
That
shall not go
of how
many of our citizens have lived
under sub-standard conditions.
If
with
his
took
very
can
find
a
way
to distribute
more of the good
things of life to
this portion of our population, we
shall have a market which in size
and
permanence will
far exceed
the present huge war-born back¬
time to
of
There
are
a
number of theories
with father's
on
we
came
correction
a
affairs.
But
of
in
due
grees
in chemistry, mechanical
engineering, civil engineering and
many other subjects which will
fit him
rious
if
But
to
good
habits
frugality.
So,
to
follow
vocation, he
a
dis¬
must
acquire most of his training after
he
leaves
one
college, by working in
more
or
ganizations
the
of the marketing or¬
established
now
industrial
some
in.
or
of
division
research
market
Only
concern.
after years of
on-the-job experi¬
qualify as an expert"
in this field. ,,;// / /
•
> \
.•Consequently, if we are to be/
prepared for the continuous longrange planning which will become;,
ence
he
can
essential part of every well or¬
ganized business in the future, we'
an
should begin at the grass roots by
our
watch¬
and for next
word for this year
as
fostering and encouraging young
get back into the
hard selling and
of
intends
he
va¬
manufacturing.
of
ago,
going to be dif¬
was
us
skilled in
become
to
phases
state
...
I knew it
A young
this
that, after World War II, our or¬
ganization should profit by this
lesson.
ficult for
vocation.
a
as
today has the choice of hun-,
dreds .of schools which grant de¬
man
time
some
experience in mind, I
definite steps to see
rigid
logs.
the post¬
was
everywhere."
cry
account
we
admit the true
In
Even though our
living standards have been far
higher than any other nation,
We
.Today, when people
;
to
buy
that
waiting
are
anything and everything
economy
can produce,
we
shall
probably enter
gradually into this final period in
which
itself,
any
our
we
economy must sustain
should be able to avoid
sharp depression.
As
a
our
system of distribution the most ef¬
fective
and
world.
But
to
stabilize
will suffer
at
a
living standards
sufficiently high level, we
our
can
most
efficient
during
though they
were
the
in
the
war,
al¬
faced with
many
difficulties created
by; the dfraft,
supplies and dealer prob¬
lems, they did not have to prac¬
tice rigid economy nor did they:
have to meet hard, competitive
selling, such as they- encountered
in pre-war days. They have be¬
come used to looking at sales fig¬
ures that have climbed higher and
short
which
we
also taking another step
believe will be of great
the
consider
to
men
distribution
science
of;
their life work and /
as
persuading
universities and
offer regular courses
study, which will eventually
result in the granting of degrees
in market research, sales manage¬
ment and other phases of distri¬
by
colleges
to
of
'
bution.
;
The
'
people of this country have
benefit in the critical days ahead.
aspire to his highest ambition and,
if he has the will power,
are
that extraordinary
demand, plus price increases, have
accounted for a large portion of
the dollar sales increases; and that
the proportion of expense to
sales
drop in a period of rising sales
volume, even though the organi¬
zation may actually be extravagant.1
1
1
•
After the first World War, con¬
ditions were, in many respects,
similar
to
those
today.
In his
book entitled "Men and Rubber,"
can
painted a vivid pic¬
lush expansion and
easy sales which our organization
went through in those days.
He
said, and I quote:
/ .
/
/
ture
father
of
"In
find the way
the
common
manufacturers,
v
>
to sell.
that
• we
with most other
we
did not have
However, we imagined
were
selling,
for
the
world's concept of
the
country
of
ours.
In
recent
,
the temptation to try cer-r
tain experiments, however noble,/
years,
has placed limits on ambition, on
opportunity and
cent
we
ability.
indicate
on
developments
are
-returning
Re¬
that
-
to the original:
free nation, a land in"
may rise as high as
his will and his skill will permit.
concept of
which
a
man
a
Once
the
we regain
this freedom,
mantle/of responsibility for/
^
-
,
i
v
;
•
•<'
•
But the
(
.
must be ready, by the time we are
faced
with
the
change" from a
sellers' market to
a buyers' mafr
If the economy of the future
to be on. a higher level than
tory, the forest and the farm,
eco¬
nomically, efficiently and jntelli-7
gently, so that more people may
ket.
enjoy more of the good things of
is
life.
*
-
before the war, our nation's busi¬
// These
are
is
That
this
1
low.
-The facts
the abil¬
ity and the courage, he can make
his aspiration come true.
providing full employment and /
r>',
l'.. "*<
.'•>
•.«•»' 11
*'!'{?
long-range planning job maintaining and expanding the
which business faces must go far standards of living will again rest
beyond
these
basic
measures. upon the shoulders of private inNew and better products and ser¬ dustry. /If free enterprise is to vices must .be developed without survive, industry must succeed.
delay.
It takes time to perfect And a large measure of its suc¬
them, to market them and to cess will depend on its ability to *
create a demand for them.
They distribute the products of the fac¬
J»
only to the extent that all
businesses in the nation are able
^
where opportunity is not limited,
where a child of humble birth can
We
higher each year and they; have
beehrlooking' With' great satfsfac¬
tion at percentages of expenseto
sales, which are at an all-time
mat¬
no
we
are
putting more emphasis on
distribution is not a matter of too sales training. In other words, we
grave concern.
But in the period are not only felling our > people
of self-sustaining economy which
that they must "Learn to Sell
is to come, distribution will be¬
Again and Learn to Save Again,"
but we are showing them how to
come a more vital factor in Amer¬
ican business than ever before.
dp both of these things. We are
Whether this new era toward well along on what we believe is
which we are heading will be bet¬ a practical, brass-tacks program of
ter or worse than that in which giving the many new people in
We>*cfcmerly; lived / is largely up ! our organization the instruction
to 7 jthose who will have the re¬ which they must have if they are
sponsibility for 'distribution and to succeed in the competitive pe¬
marketing. Never before have they ; riod/that lies before us and, at
been confronted with such a chal¬ the same* time, we are bringing
lenge to their ingenuity and skill.; our older employees up to date
the
Before
war,
they worked; on these fundamentals.;
my
fact, if
us
fancy
years to come.
to
ter of
Consequently, then, it is by
means
backlogs
not
capacity and the manpower to
supply those goods in sufficientquantities. ; A11 of the elements
essential to continued prosperity
are
prevails in the automobile
ind ustry and over a broad range
of oroducers' goods as well as dur¬
able Consumers' goods.
Then, as
more
people mak¬
and
money
tion
see
Ulation has grown, expanding the
size of our markets.
In other
A similar situa¬
for construction.
Now
backlog of consumer demand built
up
during four years of war.
Never before in our history have
we
had so large a labor force
available.
Furthermore, our poo-
We have only
housing situation to
realize the number of years it is
going to take to satisfy the need
quickly the
more
backlogs are going to
in some lines than in
to think of the
is by no means a/ foregone con¬
clusion.
C The
course,
re¬
trend
a
Of
last longer
be whittled down.
the increased flow of goods from
factory to consumer may very
well result in a recession which
i
people
"economic
own
study aimed at graduating a stu¬
dent qualified to enter into dis¬
tribution
tribution
trappings for it¬
ordinary times, one has
to
get along
with things far
short of the ideal, but in those
days we had to have absolute
self.
.
our
sidings and
clamoring
on
condition, and hence the sales
department had the leisure to
/
low
The potential demand will be
tremendous.
• People
will want
and need the products of a very
high level of employment. In the
our
dealers, and just
in freight cars
by
away
would not let
,
unfilled needs of
our
"Many of us imagined what
•was
happening, but our pride
industry is in developing
keting them
prices,
in-
an
abolished
buyers.
in
and better products and mar¬
new
tires
our
taken
in
do
would
we
startling
we
to be thrown off
far
as
accumulated demand for products
and " services
for
tards industrial output or prevents
had
method. We
that
as
sent
others, but, generally soeaking,
they are still very large. In many
fields; they are just beginning to wonders in making the American
Production Crying. Need
know
not
branches and
depend largely on three
how good a job manage¬
and labor
by a serious
trained in the
science of distribution. Compara¬
tively few institutions of learning
have
comprehensive courses of
ingenious
organization.
new
ceed will
comes.
The
the
factors:
ment
handicapped
shortage of men
are
.
the
whole sales force, closed all
to keep our. economy ,at a .high
level during the present period.
>
sales
have shown
high levels that people can¬
the output of our
economy, even though they have
greatly increased spendable in¬
not afford to buy
did
high
crease
we
all
for
.
we
-
which
manufacturing costs and
lower
with
.
"Every change we made in
sales methods brought results—
Factors In Success
Whether or/ not
dis¬
,
in¬
because
in
and proved
level of current demand.
1
prices
for raising living standards.
to
the
realization
Per¬ year is "Learn to Sell Again, reawakened
sonally! I subscribe to the idea of Learn to Save Again." By re¬ that we have the world's highest;,
high production as the first requi¬ forming these good habits now, we standard of living, not by mere/
site step.
Obviously, if goods and hope to be able to put our organi¬ chance, but because we have built
from
a
recession
from
other services are not
available, people zation in a position of prepared¬ upon the foundation of free enter-'
causes.
can not buy them.
The more we ness for the days ahead when our prise.
They know that people of
as a nation
Naturally, we all hope that any
produce, the more we industry moves out of the catch¬ every race and color and creed,
as a nation can possess.
ing up with accumulated demand are eager to leave their homelands
price declines will be gradual and
The sec^
period into the period in which and start life anew over here in
come
in
an
orderly
manner. ond step is to distribute the out¬
Otherwise, we may get into one put of our factories so efficiently we hope our economy will be self- this country because they look
of those spirals, inspired by panic that We as a nation do possess
sustaining. • '
i
J w
•* ' upon the United States as the land
as they
pessimists are, persistent
even if
people. If they just keep on fore¬
casting bad news long enough, this should occur, I do not think
they are sure to be right some¬ the consequences would neces¬
time.
So now they are telling us sarily be too painful, because the
;
.
notions
The problem,
a
.
fell
7
rising
old comparisons
it is no wonder that
our
ness
must
expand/and; *this>*can>
happen
to
grow.
'
•VifcS:
/ Murray-Jacoby, Blank & Co. is
'
.
new and better products
and services must be sold aggres¬
sively/This
means that individ¬
engaged in selling must be
taught
to
do / a
stronger / and
sounder selling job. •
Markets must be broadened by
uals
*i
Wurray-Jacoby, Blank Co.
engaging
way,
are
eral
the
in
busi¬
securities
from/ offices . at 120 Broad¬
ness
York
New
City.
Partners
E. Blank and C. Schiels, gen¬
partners, and Herman Mur¬
„
making
more
available
at
and better products
To ac¬
lower prices.
this objective, a close
and careful study must be made
of methods of distribution. This
ray-Jacoby,. limited partner. Mr.
Murray
-
business
an
Mr* Blank and
associated
formerly
did
individual,
and
Jacoby
as
complish
Mr. Schiels were
with him.
/
:
,
does not necessarily mean reduc¬
ing the total cost of distribution.
am speaking only of its cost per
unit.
This can be done not only
I
by
eliminating
needless
unpro¬
but also it may
accomplished
by
spending
more money on sales efforts which
are productive.
; /
>'
To meet the challenge of the
ductive expenses,
be
.
self-sustaining
period
ahead,
we
j; Howard A. Prior Opens
a
FREDERICK, MD—Howard A.
Prior is engaging
business from
Patrick
Street.
with Merrill
ner
& Beane.
in the securities
offices at 105 East
He
was
formerly
Lynch, Pierce, Fen-'
THE COMMERCIAL
2M2.1
for the price
began. Is it not
pathetic that those who are today
receiving the benefits of previ-:
ously sold insurance are being
hurt by the very same forces that
are making
our current sales so
therefore, what reasons can be "
given for thinking ; tha|:> business r
recession is in the making during
high?
it
was
national income and the amount
rently at an all-time peace high.
of the nation's savings, this brings
The
Department of
Commerce
which automobiles are now be¬
us to a consideration of the fac¬
•estimates that total income pay¬
ing sold. Moreover, if we let the
tors
which will determine the
ments are running at the rate of
ease with which new agents can
level of the national income and
about $170 billions per year.. In
now be
recruited induce us into
the amount of the nation's sav¬
putting under contract large num¬ brief, there has been the where¬
with-all to pay for an increased ings for the coming -year. Inas¬
bers of men who are ill-equipped
volume of life insurance, whether much as the national income is
and unsuited to sell insurance, it
measured by the amount of ac¬ expressed in dollars, we have to
will not be long before all the old
form some idea, first, as to the
cumulated past savings or whether
agency problems that were with
of
physical production
measured by the current flow of amount
us
in the 30's will be present
that will be turned out by our
again. But, as agency executives, national income,.
farms and factories in the days
no doubt you are alert to this as¬
Now, let us see what the war ahead
and, second, the price level
pect of your problem and are more did to the need for additional life at which these products will be
familiar with it than I. Accord¬ insurance. Depending upon what
sold. To arrive at any idea about
ingly, I am not going to discuss index is used, the purchasing these factors, we must make some'
it further. May I say, however, power of the dollar has decreased
guess as to whether or not a busi¬
in passing, that I do hope it will somewhere between 35 and 40%
ness
recession or depression is
receive
proper attention
during since 1940. It must never he for¬ ahead, or whether the prosperous
the meeting. You cannot afford to gotten that, while our contracts
conditions of the moment will con¬
are
written and payable in dol¬
ignore it.
tinue on quite indefinitely in the
lars, the real protection that they
(Continued from page 2607)
War Created New Demand
v rfor; Insurance•
:i
■
Everyone, of course, is familiar
with the fact that the war caused
a
backed-up demand for products
as refrigerators, radios, au¬
and houses that will
such
tomobiles
take
to fill. But, few
years
some
people stop to''think that one
of
of the /war was the
creation of an additional need for
results
the
beneficiaries of the con¬
be measured in the
goods and services the
dollars 'frill provide. It should be
crystal clear, therefore, that the
price increase caused by the war
in itself made a demand for an
additional amount of insurance
of at least 40%, if the people of
this nation are to enjoy the same
afford the
must
tracts
amount of
real
insurance
protection that
&hich it likewise they enjoyed before the conflict
may take several years to meet. began.
Superficially looked at, it does
This is what I call the backed-up
Seem strange to say that the war demand
for
insurance resulting
created a demand for new insur¬ from the war. This demand to
ance
when the sales of private date has not fully been met even
life insurance did not fall off ma¬
by the phenomenal sales TOf the
terially during the war years and last twelve months. If you want
insurance
life
when the Government itself wrote
insurance
new
whether your own com¬
to decide
the soldiers to
on
has filled this backed-up de¬
mand, see whether it has in force
k In fact, at first glance there was at least 40% mOre insurance than
some reason for thinking that the
it had in 1940, If it has, it has just
large amount of Government in¬ taken care of the demand created
surance
sold might restrict the
by the rise in the price level, but
market for private insurance and it has added nothing to take care
make selling more difficult.
of the growth of insurance needs
pany
dollars,
the tune of several billion
And, you may remember that
one
time, during the conflict
were some students of in¬
surance who feared that the sale
of Government insurance to the
veterans might actually
cause a
this"
there
b
decline
in the
amount of private
sold
sales/
Current
of
such
mark
years,
our
,
reached
{an all-time /high^-all because. of,
Qr in spite Df, the war—I* know
course,
which.
not
We
now
may
summarize
the
principal changes in the market
resulting from the
how wide of
for insurance
forecast was.-A
have already shown
the
.period
creased by
the number of marriages
after the war was
insurance
over.
and during
population in¬
about 10 millions and
those
during
at
a
large amount, of Government in¬
surance, is being kept in force
war,
1.
follows:
as
Assuming the nation was ade¬
insured at the outset
to compensate for
quately
by the veterans and still our new
/business is breaking all previous
of the war,
purchasing pow¬
records, /certainly a most / satisfy¬
er of money alone calls for an
ing situation, / /
<
•.
/ ^increase of at least 40% in the
V The following ^questions natur¬
total amount of insurance in
ally present themselves:
..
the. decreased
_
force.
1. To what shall this really .phe/
in the
nomenal record
current
2. The
ings
sales of life insurance be at7
tributed?
"
2. Just what constitut e s the
j
;
,
are
sav-
resulting from financing
together with the in¬
crease
the
in
amount
of our
income, has made it
economically possible to carry
this additional 40% of increase
national
demand that these
backed-up
sales
monetary
increased
the war,
filling?
3. Where is the money coming
from that pays the premiums?
,
.
.
without too
It has,
in fact, made it easier to sell
insurance than it was before
Briefly stated, the high volume
of insurance which was sold dur1
'•
ing the past year (and which is
currently being sold, although I
think with somewhat greater ef¬
fort than earlier in the year) and
the
surprising amount that
war
because
currently
a
smaller percentage of the na¬
tional income is going into life
insurance,
,<
the really
great a burden on
the nation's pocketbook.
k
';was sold
than
was
the
case
before the war.
during the war years
In a very real sense, therefore,
: was
made possible; by the same
life
insurance today is
passing
thing; namely, the phenomenal in¬
crease in savings
by individuals through what may be termed a
of? reconversion similar
which resulted frorp financing the period
r war. The
Securities and Exchange somewhat to that of other forms
Commission
estimated
the middle of
1940
that
from
to the end
of
1945, the total of such savings ag¬
gregated $157 billions. This is a
figure about equal to the total
amount of insurance in the coun¬
try.
Monetary
savings
were
so
of business. Present sales are both
force. During this
also,
the
national
period of time,
enal
increase
and
and
ease
with which life
currency,
or
banks
growth of the
Government
and
real
savings
that
are
built up when the budget is bal¬
anced cannot be made too strong.
The Federal > Budget,
redeposited
that
the
war
created.
It
was
the
increased mon¬
etary supply or its equivalent that
the
under three:
accumulate X. Costs and prices are too high;
and
some
is doing
readjustment will
have to be made.
financing throu g h the
deficit
them in the banks of the country.
immediately ahead will primarily
upon
most
The labor situation is hopeless.
and there is little chance of it
getting'
'v.
3. Inventories
it is, bank deposits and
need not be increased by
Government
action.
They -will
if
currency
only increase if the demands for
business expansion call for an in¬
crease.
Ther rapid piling up of
/
:
•
■
are
large/and there
be
some
the
better r in
hope, at 'future.
during 1947
we
last will b6 in balance
and,
v
-
*
-
11 i
,g e
near
•
n g
tobv
have
to'
slowup in certain lines'
may
"in order to work them "off.
'
*'
"
maybe*
The inventory situation
dangerous than is .commonly1
While the total amount*
more
belived.
.
phenom¬
today is cur¬
depend
seems
head-important ones,
to me, can be grouped
many
„
increase in these claims on goods
a
the
could /be'
reasons
.
determined by the
amount
the
ings,
these
down under
savings which
when
While
broken
,
insurance will be sold in the years
ured in dollars showed
tary"
1947.
,
meas¬
income
This distinction between "mone¬
filling current needs and also a The net result was that after each
backed-up demand caused by the and every bond drive, bank de¬
war. When this backed-up demand
posits and currency in circula¬
has been fully met, then, like the tion together showed an increase
identical amount
sales in other lines of / business, almost io the
the volume of insurance sold will that the commercial banking sys*
be
cause
war
"monetary"
savings
caused by
of inventories may not be unduly,
deficit financing should
bg hear¬
excessive when measured by Vol-/
future.
ing its end. And this is a "consumr;
mation devoutly to be wished,'* ume of business, their growth and4
But, before giving reasons for or
for the continuation of such mass¬ composition are somewhat alarm*,
against expecting a business re-:
ing. Manufacturers'
inventories,!
cession to ocfcur sometime during: ive/"sa^ngs"/for hhpiber year oi:
two would be running the danger according to the Commerce De-;
the coming year, I Want to set
partment tomiled/18.8 JiUionS mi f
forth briefly what was responsible of "saving" the country right into
Sept. 30, a rise of .2.8 billions since!
for the
huge monetary savings bankruptcy.
Jan. 1. Of this gain, nearly ,65%^
The honeymopn period -of sell¬
that took place during the war and
took
place d u r ing the three'
why it should be crystal clear ing life insurance is drawing to.a months of
July, August'and Sep¬
that ho such amount of savings close. It may last for a few months
tember, Likewise, iixvehtories ii»v
will take place during the next longer but its life expectancy, as
the hands of wholesalers t/as":'Of/;
few years. I don't want you to our actuaries would say, is not
Oct; 1 were-about 45% more than*
build any agency plans in the ex¬ long. In the days ahead, as the
aycsir ago.'It is probably the,/Com-//
pectation that this nation is going country gets fully adjusted to the
position of these inventories that-"
to have savings to the extent of increased monetary supply and as
is fraught with more danger thanf
$40 or $50 billions per year in the accumlated war savings find their total amount. A
good deal*
the future. If you do, you are go- their more or less permanent place
of evidence is present for thinking'
Sag to overbuild and will have in our financial structure, they that
they are made up of exces¬
some retrenching to do in the not will no longer spill over into in¬
sive amounts of certain .parts and'
surance.
When this takes place,,
too distant future.
materials and with very little of!
future sales will then mainly be
others; In! short,that they^arb%n*:;
Origin of War Savings
paid for out of current income and balanced. Inventories of this com¬
In a very real sense, the sav-! savings, But sales will still be
position can become -excessive and *•
ings that resulted during the war high for they must be at least at the same time hold up prowere "phony" sayings. They "were 40% higher than prewar to take
duction. For instance, unless auto* not savings in any real sense, if care of the increased price level
mobiles have, batteries,, they Pan-!
savings are defined as additions allowing nothing for growth. They nbt be distributed.
Or, if the atffca*;
to the physical wealth of a coun¬ must also be 40% higher if our
mobile companies have ample' Xn#'
try. They were merely "monetary" salesmen are to maintain their Ventorles of
everything except/
savings. The physical goods that own- standard of living. This is
sheet steel, - they have to close
should have been back of them going to be a mighty force to
down, as has recently-been the ex*;
to give them substance and real make the average policy sold in
perience of some.
worth were war goods—goods that the future t. larger than it was in
The inventory situation while*
were * destroyed
and wasted in prewar years.
not altogether satisfactory would/
battle! And, when the destruction
During the decade of the 20's not alone be
alarming if the price;
was over, all that " remained with
and the more prosperous years of
us
were the
"monetary" savings the 30's, this country probably situation were more satisfactory.;
There is a good deal of reason, for
in the shape of increase in cur¬
Saved about 10 % of its income. We
thinking that the present, price;
rency in circulation or in bank.de- can look forward, "therefore, dur¬
structure, brought about:by
posits. There were no new public ing a year of normal business ac¬
changes which occurred during!
utilities built, nor railroads im¬
tivity when consumer goods are the war and
through ill-advised;
proved, nor factories erected to abundant in the market, to sav¬
OPA restrictions, contain so many ;
back up and give real value to
ings by individuals somewhere
maladjustments and rigidities^ that!
these savings. Our physical plant between
$14 and $15 billions, less it will be
impossible for a con-;
remained quite the same with the than a third of what
they were
siderable period of time ahead to!
exception of some war industries, during the war. Currently they
maintain full production unless
while our inventories of consumer are
running somewhat higher, but
a considerable adjustment is
goods were drastically reduced. this
may well change when op¬ made. By and large, this adjust¬
All that was increased was our
portunities for spending are more
ment must be downward with the
money supply.
abundant. When -jthis period of
exception of freight rates and of ;
Perhaps I can make this clearer transition with its phenomenal
the wages and salaries of the.
if I explain briefly just how the sales through which we are now
white-collar workers. Consider for.
increase in currency and bank de¬ going is overj insurance will have
a
moment the railroad situation.
been
converted to a peacetime
posits took place. When a com¬
where our largest railroad system,.
mercial bank made a subscription basis and "the good old days" with
the
Pennsylvania, carrying • the;
during a war loan drive, all it bid all their problems/will be with
largest volume of traffic, both,
us again. In the meantime, if,you
was give the United States Treas¬
freight and passenger, that it has,
ury a deposit on its books to the have overdone your agency/ ex¬
ever carried in its entire history,
amount of its subscription. Be¬ pansion, taken leases on high rent
is going to run in the red for the*
tween bond drives, the Treasury offices, and contracted to pay too
first time in 1Q0 years. In fact,,
proceeded to spend this deposit. much for the development of new 54 of the class one railroads of the •
In
substance,
it wrote
checks territory, you may well find, your¬
country
failed to
earn
fixed 1
against it in favor of individuals self embarrassed with a budget
charges. during the
first pine:
or corporations. "As tlie Treasury; out of balance.
months of this year. This is a sit-;
Checked out its account in this
uation worse than that of the de-;
Business Outlook for 1947
manner, the individuals or corpo¬
pression days of the early thirties. !
rations
to
whom
it gave
the ! As the amount of national in¬
7 .Likewise, recently in the starved! /
checks, in turn, cashed them and come and Current savings are the
two most important factors gov¬ field, of housing -.construction, -in
took /
growth of tern subscribed to the war loans.
: Increases in bank deposits and
ment outlets other than Govern¬ the country and will depend upon
ment bonds were so few, that in current savings from current na^ currency brought about by such
tional income, together with the deficit financing are not real sav¬
order to keep these savings from
overwhelming
our
companies, degree of success that our sales ings in any fundamental sense.
maximum limits on the amount of have in channeling these savings They are only rights to demand
into insurance.
goods, or, put in another way,
single premiums and discounted
If I am correct in my analysis claims against future production.
premiums that the companies
of the situation thus far, that the They are the inflation potential
would accept had to be put in
great during the war and invest-'
the bottom
rise since the
toNormal
Getting Back
Thursday, November 21, 1946
& FINANCIAL CHRONICLE
in the shape
of
an
erning the sale of insurance, this spite of all .Mr. Wyatt's-attempts!
brings us to the question, what is to bolster it up, 'there has ap-;
the near term outlook for busi¬ peared tq be a growing reluctance ness? Is ' it - likely: $o ;^Continue at On the part of -builders: to make;
commitments
for -, housingits present high level of activity new
and on the same price level, or are after the present ones are being.
-
declines in
to be
•
production and prices
expected?
There is
no
/
•
7
doubt but that the
drastic decline in the stock market
since early
rise to
a
in September <has given
fear that
cession will take
a
business
re¬
place during the
This fear is quite
generally held in spite of the cur¬
rent high level of income pay¬
ments, the. huge backlog of sav¬
ings, and the still remaining scar¬
city of goods that exists in most
lines of production. Let us see,
coming
year.
brought to completion.r U n 1 es sr.;
present exorbitant costs of con-;
struction are reduced, costs-whichreflect /not
wage
only
increase in
an
materials;
rates and building
but also are due to an
inefficiency,
the build-.,
slow in mater-,
pf labor, I suspect that
ing boom will be
ializing.
"
,
;
.
.
.
7, »
Prosperity in this country main-.
ly depends upon three industries—^re¬
construction,-railroads and auto-»
mobiles. The immediate outlook
for the railroads, as I have indi-*
Volume 164" Number 4544
k
1
_
'
j
r
•
..
"7 ' A
*v
'i."«*/* I-'-- -•)!/'* ■'■»•••
;
«i*
THE COMMERCIAL & FINANCIAL CHRONICLE
^
•cated, is dismal. In building, the tion has reached a new high and
of. construction are So high beef, hogs, dairy cattle and poul¬
,that currently houses are being try will be in abundant supply. I
have
underbuilt
in
everything
.
leaders
.
average
our
is
low,
so
nor
consciousness
social
lie
utilities, v It really staggers
hesitancy at all in pre¬
the imagination to think of the
dicting that by 1949, given good
$6,000 in 1940. The outlook for crops, our agricultural problem ■:* demand for labor and for capital which this construction will
the automobile industry is like¬ will again be how to get rid of
wise not too rosy. While : there the surpluses.
[necessitate when once it gets
under way. A recent study of
still remains a waiting list for new
It must also be remembered that
the Federal Reserve Board es¬
•cars even
at today's high prices, every rapid price increase such as
timates $20 billions per year for
•.there is a good deal of doubt we have had during the last two
the next three or four years will
"whether present costs of produc¬ or three years carries with it the
be needed for this purpose.
I
ing cars have not priced them out seeds of its own destruction. Mal¬
think
the
estimate conserva¬
"of the mass market. Moreover, adjustments /between prices and
tive.
there is little chance of any im- incomes are always created and
[mediate reduction in the price Of large numbers ol people, includ¬ 3. Not only is there the need for
cars inasmuch • as the
companies ing white-collar workers, teach¬
the products which I have just
[are currenly being faced with de- ers, professional
mentioned but, by and large,
persons, the aged,
$10,000 that would
more than $5,000
no
of
gence
—
houses, factories, apartments,
hotels, schools, roads and pub-
•
labor
their
James Adams Predicts
lacking
so
Severe Depression
not to understand this. It is
as
altogether likely that in the
ahead, our greatest im¬
provement in economics as well
•have sold for not
'(Continued from
decade
:to
in social relations will be a
as
time, committed sui¬
In that war and peace 170
ago, general economic con¬
cide.
bringing about of a better un¬ years
derstanding between manage¬ ditions
ment
be
increased
In
wages.
[fact, the immediate outlook is for
higher prices.
•
v
and
there
those living on pensions,
interest or the accumulation or
all
Time is short and
perhaps I can
the unsatisfactory
labor and price situation by say¬
incomes
feel
and
increased
the
of
that
•
stage,
•
ers
market
the
if
1st doubtful
•»
today
prices. But,
raising
it
will
further increase in prices
1 stand a
,*
tto consumers in order to compen-
i
sate for these increased manufac¬
turing costs without severely reit stricting
demand
and actually
pricing goods out of the mass mar.
end, such a price in¬
ket. In the
•
would
crease
lead
to
less
sales
same.
for
great
Again, there is a weakness in
our. present high level of sales and
production in
that they have
been overly : concentrated during
the past year on perishable con¬
sumer
goods
commonly
called
"soft" goods. My guess is that the
pipelines are already pretty filled
up with these types of goods in
spite of the fact that there seems
mas
in
steps will have to
bring about this
cooperation, I am not prepared
to state, nor can I give a blue¬
print of the way it is likely to
be done. It would not surprise
v
be
in
r
Wil¬
mington
which,
when
com¬
pleted, \viU call for another 500
additional chemists and physi¬
cists on top of what that Com¬
unemployment for to ■ be few of them on retailers
to widen the mar- shelves. When their demand falls
ketrfor a product except to lower off, if the demand for hard goods
its price. Our experience in the does not increase correspondingly,
pany already employs.
production and sale of automo¬ a business recession will certainly 4. I confidently predict also that
biles
before - the
war
clearly take place.
we
will hear less of the old
and eventually
there is
no
way
proved this.
It
would
seem,
postponement or curtailment of
proposed plant expansion to the
extent of hundreds of millions of
dollars. In Wilmington, Delaware,
:
alone, General Motors has failed
Co.
s
postponed
has
two
large
building ventures. The number of
cancellations
of
proposed
1
i such
I plant expansions throughout the
f country must be: many and the
| amount of money involved, stu-
J pendous.
»
•
j
The labor-management relation
j at. the moment could hardly be
But, I do not want to close on a
pessimistic note. For the longer
pull, there are many valid reasons
that can be given for thinking
that this nation has a long period
of business prosperity ahead of it;
Given some price correction, and,
in the main, the correction must
be on the downward side, improve
the efficiency of labor, remove the
remaining
government controls,
balance, the Federal Budget and,
yes, reduce taxes, all of which
things are not impossible .of ful¬
fillment
in
the
two
next
tomobile
and
there -is
little reason
for thinking that it may not get
worse
'
factories
a
distinct pos-
taxes
is
are
relation to the long
and in the number of
supply and demand factors,
and a readjustment is certain to
that
.
ities
crease
promise to keep agricutural prices
..at 90% of. prewar parity for the
Butter
and beefsteak at $1.00
lias taken the public's
the real facts in regard
fear
5.
of
Agriculture has just reported
that the physical volume of farm
productionotthis
2.5%' above'the
in
a
ten
years'
average
wheat
will
Corn
crops
not have &
..
.
as
feed
1942
are
will be 4%
record.
Record
be
citrus
in .prospect. Tobacco
the
crops
produc¬
is
thinking
•
.
,
~
do
the
•„[
growth
construction
of
all
in
'
kinds
v
growth in industrial
tech-
nique which has made obsolete
so
much
and
of
our
equipment.
teach labor that is for its own
piker.
a
•
eventually
war,
every
the loss of capital
From
the
short
_
-
?
term
me
the
as
a
cause
Dilloii Director
am pessimistic.
that a business recession in
view, I
to
point of
It seems
coming
year,
'
Directors
of
& Foreign Secur¬
of
Boards
The
inevitable.
is
Whatever the reason may be, a United States
and
United
price readjustment in many lines ities .Corporation
States
& In¬
must be brought about. Probably
terna t i o n a 1
it
can
only be brought about
a recession
railroad picture
deed.
Construction
are
Secu
in business.
high.
people and should
the Keynesian
It is impossible, at today's
of construction
to
build
through
The
costs
costs
i t i e s
r
Corpora t i o n
announced the
dark in¬
is
too
election
o
Dillon
and
the
that
all
a
at
once.
The
merely for the onesmallest income
in the nation, but for the rank arid
file of our average laboring class
third having the
of
to
at
of
chairman
of
board
the
-Read
Co., fills the
Dillon,
&
produced * in volume and sold
prices to reach, the mass mar¬
vacancy
c.
war
of
com¬
panies. M/.
Dillon, who is
people. These costs will have
be adjusted. Labor productiv¬
ket.
the
to
both
ity in the automobile industry will
have to be increased if cars are to
be
£
Douglas
C.
presidency
ated
Dougias Diiion
by
cre-
the
retir e m e n t,
health, of Ernest B.
Tracy, who has been president of
United States & Foreign Secur?
ities
Corporation since Dec. 6,
due
to
ill
and
1927
&
States
•
President
International
of
United
Securities
Corporation since Oct. 29, 1928.
Marney & Alexander Is
Formed in Miami, Fa.
what, happens to prices to one
of
active
cooperation
with
MIAMI, FLA.—Harney & Alex¬
management; I do not believe
ander, Inc., has been formed with
public opinion will countenance thing, but charters that hold out
offices in the Alfred I. du Pont
a
knockdown, drag-out fight promise that can heyer be obBuilding to engage in the securi¬
between management and labor, tained for the sake of securing
ties business.
Officers are F. L.
such as took place during the votes are certainly pregnant with
Harney, Jr., President; R. U. Alex¬
90's or even such as took place evil.
:
ander, Vice-President; and M. J.
during the strikes in: 1919-20.
I close, therefore, on two notes.
Secretary-Treasurer. Mr.
On the other hand, if labor The short near term note is rather Casey,
Harney was with Reed, Lear &
continues in its belligerent at¬ doleful. Some falling-off in busi¬
Co. of Pittsburgh in the past. Mr.
titude of asking for increases ness seems certain next year. The
Alexander was with Atwill & Co.
in
wages
under
threat
of decline should not be too severe,
strikes, irrespective of what however, if properly handled and
happens to output and to prices, it should
lay the foundation for an McBride & Coyle
bringing on of a serious depresion and the causing of un¬
increase in population, nor with
the
"After
have
»
the inevitable result will be the
•j has neither kept pace with this
\
look like
nothing to
travelers
.
'
for
reason
>
things that can never be brought
to
pass.
Charters , setting forth
freedoms are* no
doubt a good
are
large
War,
.
more
££
every
that
so
consumption by the
our
of oversaving
cured
plant and equipment, housing,
record
above
There
population
this increase,
2. There
for all time and total live¬
stock
•
and
period.
Civil
1812—the
I steered my craft
on.
out,
None of these problems is in-*
augmented it. It shows up not
only" in the demand for higher soluble, nor is a high levfcl of in¬
wages and
shorter hours of telligence needed to find the solu¬
labor, but also in a decline in tion. What is needed is a spirit of
efficiency and in an attitude good will, fair play, giving up the
of the "public be damned." The attitude of trying to get something
ultimate solution of the prob¬ for nothing, of willingness to give
lem: will depend upon getting a full day's work for the day's pay
labor's cooperation — in mak- and, above everything else, a se¬
ing-the labor Union change its cession on the part of our political
present attitude of fighting for leaders of constantly promising
higher money wages no matter the rank and file of our people
between
..tony > resectable-': nations
his¬
'1923-32,
similar
evenly
distributed
the people. These
danger of
large scale is not
imminent, This malady in re¬
gard to labor has been growing
for the past twelve or thirteen
years-and it is not going to be
'
toric pick of 1942 and 26.4% above [v; and
the
in-
largest
the
pf
strikes on
people living in this country to¬
day than there were in 1940.
yeaf will: be
previously
the
so
Finally, I do not believe that houses not
bad
marriages
during
[approximately 10 million
*
ture -production. The ■ [Department
;
-
all
deny that ior the moment con¬
ditions in this field look pretty
place
population
and
of
War
in the long run bur labor situa¬
tion is hopeless. This is not to
population growth, this
in
lower level than
a
of depression.
1940 and11946 than it ever had
at 90 cents
per pound
mind from
to agricul¬
on
[.' Country /had.
after 1947 will be to make good its
next two years.
taken
such
some
low
Wealthy after
do much to allay
the past .six years* Contrary to
the expectation of our- author¬
/
take
place.#Given another year Of
good Crops, it is almost certain
: that-tha
Government's., problem
have
the
factors which tend to in¬
mass
sibility, there is certainly a good the following are 'sound and of
chance that the country may have
major importance.
: to
experience another such period 1. There
exists
today
in
this
as we went through last spring;
"country a huge demand for
i
:We have no doubt come to the
goods and services of all kinds,
end of. the road in the attempts
nor merely for perishable con¬
& to
.buy off strikes by increasing
sumer goods alone, the extent
wages that automatically increase
of ;which has probably never
r prices.
been seen in our history.
In fact, our whole price
The
structure is probably too heavy
bottom reason for this huge de¬
*>rt the top side already, There' is
mand, "which is not emphasized
I little doubt but that many prices,
enough, is; to be. found in the
'
particularly
agricultural
prices,
rapid growth of our population
too high in
•
at
more
crease
:
are
of
are
among
r.
term
same
shared to the extent of
we
the
The communists and their fel¬
during
-they were formerly; Wages are
higher,
pensions
are
more
abundant and national income
optimistic point of view, certainly
worse
which
labor would work
Conclusion
years,
for think¬
ing that this country should go
through a period of such growth
and prosperity as it has seldom
seen in the past. Without attempt¬
ing to list all the reasons for this
oversaving
of
Incomes
and there is good cause
during the next few months
before it gets better* With strikes
id the coal mines and. in our atr-.
I
The
thing has happened in other wars
such as the Napoleonic Wars—in
.
-
j to open up a new plant it started
! to build in 1945, and: the DuPont
which ended
,
.
•
•
all
and
goods has to be
good. Likewise, the bitter, back-; made good, and it can only be
the coming decade; Practically
ward-looking, reactionary, anti- made good the hard way. In this
every social change that has
v,.'. labor union" employer, if any World War we have - destroyed
taken place, or every; law that
such there be' in existence to¬ more capital goods than ever be¬
has been passed, since 1932 has
day, have
nothing to teach fore in the history of the world
tended to
increase the pro¬
management.
and the crash will be correspond-pensity to consume and to dim¬
ingly great,".h' : r>.*•/
Y; V
inish the possibility of saving.
bugaboo
therefore, that
there are plenty of reasons for
f " Moreover, the increase in costs
and the price rises that have al- thinking that some business re¬
ready taken place has lead to a cession is inevitable in 1947.
.
early
boom.
a
1920
and
idea
could be that of those who were dependent
there might be upon me for looking after their
some
chance of changing the investments, through World War I
union from what it is now, and its succeeding years, on this
merely a fighting organization theory and I am still going on it.
against management, to an ac¬ I think that we are wise in going
tive, cooperating agency with, into snug quarters for'the next
Some time,
management; There is little couple of years or so.
less
at stake
in this matter although I may not be here then,
than the welfare of our democ¬ to give you my advice—good or
racy and our whole free enter¬ bad—I think that we might per*
prise system. An attitude of haps go back into the more specu¬
fairness—give and take—an the; lative stocks again but be sure to
good old-fashioned Anglo-Sax-' get out within a few years because
the next crash will
make 1929
on manner is what is needed.
If
worked
took
of
with the crash of 1929.
constantly
with
management
and as a part of management.
•
end
the wild speculation
when committees elected
come
to represent
the
had
we
through 1921, we had the primary
postwar depression as we had it
after the Revolution.
Then began
however, if the time should
me,
the war a
of technical improve¬
center
to
taken
Then
1919.
Toward
Just what
during
research
declared at
actually foments labor trouble.
Capital is abund¬
place that remain for in¬
dustry to develop. Ind.ustry al¬
ready has plans for so doing.
To. mention again the DuPont
Company, may I say it has
plansvunder way for building a
was
the end of 1918, peace signed
ments and scientific discoveries
new
"The Armistice
which Act is too one-sided and
$130 bil¬
over
had at the
we
tern remained the
-
ant, interest rates are low, and
there should accordingly be no
difficulty to finance long term
capital
improvements.
And,
there are many such improve¬
ments already in the: blueprint
the increase in wage
r rates Of
last spring coupled with
the decline in labor efficiency has
i caused costs in many lines to in¬
crease so much that they have outready being felt iri many lines and
,'run prices. This situation would is certain to be felt increasingly
normally be met by manufactur¬ in the months immediately ahead.
ing
to
war
lions today.
duction and all that
I, but the pat¬
creased from about $50 billions
high
atempt to return to the
no
end Of World War
the
before the
prices and their
buying is reistricted. In short, the
high prices curtail the.market and,
while a real buyers' strike may
hot take place, sales resistance is
markedly increased. This is al¬
pinch
those
tempt to keep in force all the
-I provisions of the Wagner Act,
purchasing power
existence
to
buy
them.
Liquid assets of individuals in-,
.
were wholly different from
today.' We had no banks,
no
Federal Reserve
system, no
steam, no electricity, no mass pro¬
should
There
pother hand, it is futile to at¬
in
previous savings, do not have their
•summarize
is
labor.
and
so-called "good old days" when
there were no unions. On the
:
for
2602)
page
York at that
"
mands
2643,
V
•costs
built to sell for
1
employment
-
on
In spite of some
extended
period
after
some
scale.
have
been
evidence to the
note,
a
large
I
existing plant
contrary
This nation is
cannot believe that the intelli¬
in the coal
mines,
needed
made.
therefore,
buoyant.
behind us;
is
of
prosperity
readjustments
Open in New York
'
J.
My long term have
cheerful and
not
Our best days are
they lie ahead.
with
F.
J. J. Coyle
& Coyle
150
Broadway,
McBride and
formed
McBride
offices
at
New York
City, to engage in the
securities business.
*
THE COMMERCIAL & FINANCIAL CHRONICLE
2644
The Production Outlook ior i9>4!7
(Continued from page 2606) ^
>
;;
meet
/
,
items
Let
give
me
been
have
we
month
this
or
of
producing
40%
tires; ab7o
more
electric
and
20%
more
more
have
10%
worsted
we
have
that
.
and
But
The
pro¬
at V-J Day to
but
are
still
the
average
terial industries and in
component
plants resulting in the unbalanced
flow
of materials and parts. Me¬
chanical refrigerators and sewing
machines
I,
are
in
much
position and for the
it
lacked
statesmanship to get through
Labor Management Relations
the
same
Another
-
f
major
problem ahead
is labor-management relations. We
are hearing much about new wage
:
demands, but
labor
many
of the national
leaders have shown
an
ap¬
preciation of the economic fallacy
of having prices and wages playing leapfrog. Many of the rank
and file with whom I have talked
also appear to recognize this prob¬
lem.
Many
representatives
of
management have recognized that
organized labor must be reason¬
ably and fairly; dealt with, and
they are striving to;■ find common
grounds for reasonable negotia¬
tions.
The trend toward decontrol
and the recent actions in abandon¬
ing wage and price controls leave
management
free
to
negotiate
wage adjustments with the reali¬
same reasons.
copper;
a
was bulging with copper;
Our economy today is at a simi¬
lar point in reconversion.
Some
country
parts
fabrics;
industries
zero
because
warehouse in another part of the
faster than others.
radios; 30% more
October
below
the
a booni
It will take real busi¬
bust.
tion
prices rise to a point where they
choke off production. -
313,000 produced
month of 1941.
This slowness has been due larger
ly to labor difficulties in basic ma¬
in
wheth¬
passenger
more
hit their stride.
285,562 in
economy or
the months ahead without having
more
increased from
on
stable
ness
showing steadily increasing production, but is still 9%" below
1941; largely due to labor shortages. Passenger automobiles have
;
a
a
going/ to have
are
we
maintain
epidemic of unfeal--,
getting ships with¬
out
propulsion macninery, air¬
planes
without
propellers,
de¬
stroyers without torpedoes. A fac¬
tory working .on a rush job for
the Army had to reduce produc¬
an
were
are
duction of cotton fabrics has been
1
can
in
We
ance.
for' the
civilian trucks.
other
not yet
we
expanding
and
now
major factor in deciding
a
selves
We
1941.
farm machinery;
gas ranges; 19% more
woolen and
6%
er
from
do
and washing ma¬
ranges
chines^ 27%
prices
whether
following
and
year
month
average
;
will be
closely. Tne comparisons aregeneraily between the most recent
;/'V
about
know
,
What
figures on some of the
you a iew
all
well, in¬
prices wipe out pur¬
chasing power and cut down de¬
mand f orgoods,
Ti.e output of many other goods
is at all-.une records.
uncertainties
we
flationary
w. -
Output At All-Time Records
7
As
costs.
in .the first
needs
lumimum
halt of next year.
of
because
That
was
are
producing more bricks than
we
can
match
with-
hardwood
flooring and cast iron soil" pipe.
Not too many bricks for the build¬
we
our
other supplies.
'
>
,
-
r
v
problematical.. They include the,
prices,. of manage-i
ment-labor relations, material
shortages, rising inventories and
;
*
industrial unbalance.
*,«
' One
of
•
immediate
//77
7j;-
concern
is
/ the question of prices.
rect
What dieffect will the lifting of ceil¬
ings
have
tion?
;
I
on
think
industrial
it
is
produc-
obvious
that
'
the
trend
will
be
mixed.
Some
'
serious
every way
possible.
distortions
will
be
cor-
*
I
ance
of the unfavorable
factors in the picture
today, and
of
as
one
course
our ;
terials where price has so far been
discouraging factor. But, at the
t;me, there are bound to be
some
new
dislocations.
Rapidly
a
"
same
of
ma¬
terials and components are a
part
of that picture.
The makers of
fractional horsepower
motors, for
example, have order backlogs for
almost 38 million
if the orders
are
motors—which,
firm, amounts to
about 21 months' production at the
But
even
where
are
In
difficulties.
the
less;
*
severe
/.
;
,there
' ,
early phases of the'
production program
produce everything
fast as possible. We
we
war
started to
we
could
as
in
the
population.. These figures
tendency, for population
away from the New Eng-?
land, Middle Atlantic, and East
Central regions to the West. Coast,
show
to
a
move
the
West
lantic
Central
areas.:
South
and
At¬
77V7;7. :.7.;7_r/■ V
The second set of figures com¬
HH authorizations for hous¬
pares
ing with
again,
same
prewar patterns Here
find evidence of the
type of shift.
a
we
The third is the number of
re¬
quest that CPA Field Offices have
had in connection with non-hous¬
ing
industrial
and
construtcion.. Again,
commercial
the
same shift
pushing
?>::.■/ 7\V,v-77 /
; j
factories, expediting produce r Now, ,these are. quite clear indi-joutput in many ways. They make; tion all
along the line.
After cations to .the; producers of na-i
it difficult to schedule production about a
year of this we found our¬
tiojqally/ manufacturedbuilding
rising
prices strike
at
industrial,
up
x
shortages
curred—three broad indicators.
/ The first is geographical shifts
/
mentioned;, industrial; unbaL
rected, and this should permit an
present rate.
expansion of production of some
shortages. are
badly needed products and ma¬
,
/
:*
,
"*r*
were
controls draw to
correspond.ng shifts. Industry will
need to gather all available data a close there will be inevitable
relevant to its products to gauge economic
adjustments that will
this shift.
bring some bumps, jolts, and
strains to business. I am convinced
Wants No Central Planning And
that they can be, and must be, ab¬
Control
sorbed by the resilience of the
During the war, balance was free enterprise system."
/ •:
'
achieved by central planning and
rigid controls.
then.
But in
It
who will feel
jars will sigh for
the
days ..when
government,
through priorities, wet-nursed the
industrial
economy.
Some will
Some
was
necessary
peacetime democ¬
a
of
decisions.
Production
controls
sched¬
legislation to put
of our economy
positions.
That
path leads toward regimentation
of the industrial economy.
Once
we start down that path we will
pick up speed amazingly fast.,
lot of expe¬
to be done to
a
diting will/have
keep the/ supplies flowing.
or even
selected segments
in
preferential
ules will have to be projected at
levels that are in line with avail¬
able supplies and
those
advocate the reinstitution of
even
companies must reach individ¬
ual
of
these jolts and
Finally, there is
.
one
t
.
question " of
ahead,
or
I am convinced that all of us
other prob¬
that;American industry must who believe firmly in - the free en¬
Perhaps we are producing too look at. What are our potential terprise system must resist such
many small rsidios and too;/ few year-iri
and year-out markets? pressures with all our strength.
consoles, The auto manufacturers Have we the capacity to meet Priorities
breed
priorities, and
may be receiving too many en¬ these new demands? Just let me controls breed controls. I am con¬
gines or transmissions and too lit¬ quickly recite two sets of figures vinced that we must get out of
tle
spring wire and flat-rolled that prove to me that America is them, and stay out, if we are to
steel. We may not be using enough not a mature
nation, that we have retain freedom. At long last and
Number 5 wire rod for nails3 and not stopped growing, that the
past with deep thankfulness the day is
bale ties, and too much for woven is but the prologue to the future, drawing near when I will be able
wire fences. Similarly3 some in¬
Since 1941, the population has to return to industry. In leaving
dustries today may have more increased 5% %, If people wanted, the Washington scene I would like
manpower than a balanced flow on the average, the same things to express again on behalf of CPA
of all materials and parts re¬ in the same
quantity as they did our deep appreciation of the co¬
in 1941, we would need 5%% operation, help and guidance in¬
quires.
Others
suffer
from
a
more production.
shortage of manpower,
dustry has given us during the
;
*
ing the troublesome period
we shall all get hurt.
equipment-items will show
the
rocking dur¬
lem
.
his coal stocks in
industrial boat from
As government
need, just too many for
ing
'
conserve
home
We must keep
employment.
demand.
planning and control. In place of
it, the managements of thousands
pushed
„
to
of
racy we do not want such central
have
.
now
shift
a
Likewise,: they imply that house
furnishing and factory, store, and
why
we
had to limit construction; it
was
leaping ahead of materials
output to the detriment of hous¬
ing. Right now, in some areas, we
it
.
-
materials*of!
ahead
of
zation that necessary price changes
However, by and large, in terms can be made. The outcome of the
Problem of Inventories
of production,
things are going recent election indicates to me a
Inventories present a problem
7 well today and can continue to go
growing national impatience with
in the months ahead.
:
Manufac¬
/. well if the industrial boat is not labor-management
disputes.
Un¬
turers have to fill up the gaps in
rocked by runaway prices or majustifiable positions can only lead
their
inventories
in
order
to
jor work stoppages. Both can be to the
things we must avoid—
smooth the flow into the produc¬
avoided if management and labor
work stoppages, increasing short¬
tion line, but there is danger in
both use restraint, common sense
ages, lost production and higher
and good judgment.
building them up too much. It
prices. I am hopeful that we shall
has been said that the death cer¬
not have a repetition of last year's
Looking Ahead to 1947
tificates of businesses killed off
production-crippling strikes. With in the deflation of the
20's were
;
Looking ahead to 1947, I can a tolerant and reasonable
ap¬ all marked with
one
see the possibility of a good year.
cause—ex¬
proach, we could avoid these trou¬
cessive depreciation of inventory.
However, since we are already bled shoals.
hitting - production
Today's inventories, in general,
ceilings
in
For the third time in 14 months
aren't too high when compared
many lines, I cannot see any drathe country is threatened with a with
ma: ic• increases in overall producsales volume, but they have
strike in
tion such as we have had in recent
; the : soft- coal 'mines.
been going up very fast. 'In three
American; industry, has not yet had months—June, July and August
months. In fact, for technical rea¬
time to recover fully from the
sons the business indexes may in—overall inventories rose nearly
two-month strike last spring. Coal
dicate a moderate decline in ac¬
$3 billion dollars.
stocks are lower than they were
tivity even though we still remain
Along with a balance in pro¬
on April 1, and demands are far
at full production. "VYe certainly
duction, we have to achieve a bal¬
cannot really have a decline in greater both because of the ap¬ ance in distribution.
Immediately
business activity as long as we re- proaching cold weather and be¬
following the war, many indus¬
cause of the sustained
i main
high level
at full production and full
tries undertook to distribute their
of industrial activity.
employment, regardless of the in¬
available goods on a prewar pat¬
If coal mining is stopped to¬
dexes^ We can have an excellent
tern.: This was reasonable* for we
morrow
night, immediate steps
/>, ! year in 1947 if we can keep\57 to
knew little about what would hap¬
must be taken to conserve exist¬
/// 58 million people employed at
pen
to people who had moved
77 roughly current real earnings; if ing stocks.. The government has
during the war. Would they drift
already acted quickly to freeze
we can avoid a new wave of labors
back to their old communities?.
stocks of coal at the mines. But
management strife; and if we can
Would they stay in their new com¬
even
though this speedy action
77_j/ limit price changes to minimum should
munities and find peacetime em¬
result in an emergency
corrections of major distortions.
ployment opportunities?
Would
2Vz
times
as
large
Within our own country we stockpile
they go to other communities? No
as
last
sprin?, there will not
•<,
have the demand and the desire
one knew.
be enough to fill any but the most
to have goods and services that
Would the steel users- revert to
needs
affecting
public
should keep us at peak produc¬ urgent
health and safety. None of this their peacetime patterns/ or would
tion.
People have the money to
new patterns be set up?
coal can be given to
The same
industry, ex¬
back up these demands, and will
questions apply to a multitude of
have it so long as prices remain cept in rare cases to permit* the
other materials and products. In¬
reasonable and they are employed orderly closing of plants whose
facilities would otherwise be dam¬ dustry's first major effort had to
77g at fair wages. The export demand aged.
Therefore, every coal-burn¬ go into getting up production.
■y7 in many areas is tremendous, and
But the time now has come for
to a large extent, there are dollar ing railroad in this country, every
electric power plant dependent on American industry to reappraise
balances available now to activate
these foreign demands. Offsetting coal, every industrial: plant, and the shifts in markets. Let me give
these factors are some unfavorable every home owner who burns coal you three examples that point out
to heat his house must stand
ones,
ready some of the changes that have oc¬
and others whose effect is
f
Thursday, November 21, 1946
is indicated.
7;
.
difficult months of transition.
Second,
we have 13%% more
employed.
That
means
more people with more dollars to
spend. That can only mean more
demand, and more production to
satisfy that demand. And, we have
no right to believe that the 5 to
,
people
10 million
unemplayed in the de¬
cade of the 30's
If that is
is to be
Kurd Chairman of
Foreign Trade Comm.
Research,
J.
normal.
Company,
normal, and the free-
Chairman
enterprise system cannot;; find a
way to lick it, then we can be
sure that other
systems will be
tried.
of.
my
have
staff
done
preliminary studies: on steel
capacity. They extended the trend
of steel production from 1901 to
Walter
has
of
Thompson
been appointed
Foreign Trade
the
Committee by
Lyman L. Hill,
President
the
Some
•V?x:
Z Arthur Hurd, Director of Media
.
,
,,
?
of
National
American
some
M
date.
They extended the trend of
steel production per capita for the
same
period. They related steel
production; to the Federal Reserve
Index of production and to the
gross national product, the sum of
com
all- goods and services. I am not
sure how accurate the results
are,
Crowell-Col->
but
they indicate that by 1950 we
will need steel ingot production of
ing Company;
from 90 to 100 million tons
Herrington,
President,
International
Currently,
we are
a
year.
producing steel
at a rate of about 80 million tons
year, arid are
at practical
a
operating the mills
capacity-—a little
90 % of theoretical
over
capacity.
arketing
Association.;
Mr.
H
d's
u r
mittee
c o n s
i
s
t
of
s
Raymond
f»^
R o bin s o n/
/
/
Director
of/'
Research,/
lier
Publish-
•
William
:
Arthur Hurd
S.
Public
Opinion Research,' Inc.; Hector
Lazo,' Director of Public Rela«*
tions, Sunshine Biscuit Company;
and
Wroe
These figures make me wonder
whether we will have the steel ca¬
pacity
Director
Alderson
of
Simon
&
Sessions.
will probably need to
we
support
a
7 full-employment
and
full-production economy in 1950—
only a little more than three years
away.
-The
same
sort of studies in
other lines would show
expanding market.
equally
It's a market
an
worth shooting for.
•
Decontrol
.In
closing'T should like to
word
trols,
Price
about decontrol.
say a
con¬
except for
rents, rice and
sugar, are no longer with us. / I
believe you are all familiar with
what my own views on production
controls have been for
a long time
should be lifted just
rapidly as we could safely do
—that they
as
so.
The
record
shows
that
both
WPB and CPA have followed this
policy consistently,
continuing to do so.
and
"v
/ But decontrol has its
It
returns
the free
American
CPA
is
j
Dr.
Vergil D. Reed,
of
Associate
Walter
Company, has agreed
general consultant.
Research,
J.
Thompson
to act as
The objective of the Committee
is, first, to prepare an analysis of
foreign markets for United States
exports; second, to outline the
sales channels and advertising and
promotion facilities available for
selling United States products in
foreign markets; and third, to
outline the place and function of
marketing people in world trade. /
Metropolitan Inv. Co.
Opens New/York Branch
'
The
Metropolitan
Investment
Company,;.; Chicago; / investment;
firm, .is opening a branch office
at 40 Wall Street, New York City.
problems.
business
to
M. B. McLean Is With
enterprise system. That
gives industry and labor the job J. A. Warner in Phila.
of getting out the production, at
; PHILADELPHIA,
PA. —David
fair and reasonable wages and at Jester,
Jr.,
Vice-President
in
prices that will not cause the mar¬ charge of the Philadelphia office
kets to evaporate and unemploy¬ of J. Arthur Warner & Co., 1421
ment to set in. ; It puts on indusr Chestnut Street, announces that
try the burden of insuring, fair Nelville Bruce McLean has be¬
and equitable distribution of
its; come
associated with the sales or¬
products so as to maintain maxi¬
mum
production and maximum! ganization- of that office./
f&3£$0&W*
JVolume 164
or
about
_";•/■■ (Continued from page 2603)
Technically,
hand affords
the ■/ evidence
more
comfort to the
realities
could
have
absorbed
major weakness in the farm com¬
modity markets with so little ac¬
companying liquidation.4
But favorable technical indica¬
tions will only be a transitory in¬
fluence unless they are bolstered
by constructive fundamentals.
this
connection,
manifestations
from
apart
of
a
•
In
the
decline
in
luxury buying, there is ample evi¬
dence that the; wartime boom is
over—that - the; national buying
has ended. It does not neces¬
sarily follow, however, that there
spree
are
maladjustments in business
whole which have
a
to be
fledged depression.. .;
;/
:
Unquestionably, the point
than
were
decision
as
^
;
from here'out. '
fact
the
//. not
a
that
•
•
for soft goods; more¬
the buying spree contin¬
ued at an unprecedentedly high
rate in the first half of this
nation¬
activity,
overcome
is
as
measured by
its
,
a
in mind
ing
that:
(1)
in May
^
1
•
lion
;tqv$293J8 million
millibn;; (2) 'U o £ s t r
primarily" r e p r
not
awards
For
foundreflection
which
in
value
in
return
for
study
of the
•
its
,
beneath the
the financial ability of
foreign countries to purchase
more,
/ our goods is much greater than
is popularly believed,
Thus, exports this year may
exceed all periods in * our (his*
tory but 1943 to 1945—arid dome
close to doubling the* 1941 ^blume of $5.1 billion.
If, irFfadd i t i o n; a rapproachmeht is
regulations.
taut
segment
of
the
buying
.'yli public out of the^ market.;
>
s
l-v
t' ;
5
;
r
;
r,:
prospect of
a decline- in activity in textile
and similar lines is the fact that
steadily increasing competition
for the buyer's dollar is being
witnessed from hard goods lines
Heightening the
,
|! returning to shelves. True, fur■
f
;
niture, radios, and other items
not available during the' war
years
theoretically can be pur-
*
chased
<'
*
<
on
credit or from sav-
ings. But will debt be
at
these
prices
created
and with the
spending spree a nightmare of
past? Further, eve^i if na¬
tional
income
is "maintained
around current, levels, a return
l> to the prewar rate of spending
for soft goods and hard goods
/ automatically would spell a de"
the
■
I
•
in the former.
.
r
2. Business Inventory P ollc les:
With the experience of 1920
and-1937 in mind, the steady
^:
increase in manufacturersr iriventories in the past year has
caused considerable ^uneasiness.
:; While' the not change is only
i; cline
.
■
-
"
Of
%quiry of the British for
million tons of steel. Further¬
'
'
t; meat) and wartime price " in-.
V; creases have priced an. impor-
relief;/ witness the imposition
of export controls and the re*
2
prosperity suggests that
building boom is being
thwarted by; (a) - High prices
as a result of black markets and
labor inefficiency; (b) Unsound
a n d
unrealistic
government
public is
V: rebelling against high prices
§; (witness the buyers' strike in
last August;: Unquestion¬
/ cent
our
dollar. Secondly; the
trade
as
.
tion
•
export
definite uptrend
*'
by the
outward evidence of construc¬
-
wants
;
surface factors obscured
a
;// wild desire to spend is being
.replaced by more normal buy;/ ing habits in which the public
4l;o h!
e s e ht
disappeared.
A
thing, the emotional
wartime tensions
one
a
rangements; But there /-is no
gainsaying the world-wide de/imand for our goods for rehabilitatiori and normal trade as well
hope and intention rather than;
an actuality; i.e.,
their normal
relationship with completions
has
height—*>ur
•
reached with' Russia, thereby
the situation may
V correct
itself next spring or
opening a huge market for our
summer: inthat:; (1) Acceler?
goods, an already strong busi¬
ness
stimulus will be
inten¬
ating production will eliminate
the
sified.
shortages responsible for
material
black 1 markets;
(2)
6. Government Spending: Deplor¬
Consumer. ; inability and unable as it' may be from ; the
: willingness to build at current
/ viewpoint of sound monetary
prices will ; 'eventually
force
; / policy,
the fact I remains 3 that
V greater labor
efficiency; • (3)
deficit spending was the pril; With t regulations not building
mary
stimulus which carried
houses for veterans, controls
the Federal Reserve Board proare probably destined for re¬
;-r duction index to a peak of 240
moval. In other words, there is
in February, 1944 from a 1941
; a possibility of constructive delow of 139. Converse 1 y, of
f velopm^nts next year which
course,
the dwindling c a s h
V could importantly influence the
deficit of the Government—$21
second half 1947 business pros-;
billion in the first half Of 1945,
pect. 1
$16 billion in the sCcond half,
/ But, in the interim, building;
and $2 billion in the first six
I < activity is not likely to live up
months
of
this year—consti¬
to its wartime, promise of be¬
tuted a deflationary influence
ing a prop and a stimulant to
on the production indices. That
postwar prosperity. V < the post V-J Day FRB index
4. Industry's C a p i t a 1 Expendi¬
low; last
February was 148
tures: In. the first half of this
against a 1936-41 average of
"year;
corporate
expenditures
117 is testimony to the basic
for new plant and equipment
vigor of our economy. But what
were
an annual rate of
of the nutlook from here out—
$10
billion as compared with aeWilb private* spending grow at
course,
.
''
'
:
.
.
.
"
,
~
-
tual
expenditures
of
$£.5 bil¬
lion in 1945 and $8.3 billion in
a
Tate. which
the
Harbison
What
of
the
Can
market?
sizable
showings—and by and large
the
Chairman.
election
The
of
a
President
the princi-
as
salaried
pal
executiv
marks the
e
in¬
itial step in a
comprehen¬
W.
G.
sive
program
formulated to
Paul
•
foster the Ex¬
change's development in keeping
the growth of the area it
Mr. Paul, a graduate of
the Stanford Law School, entered
with
serves.
the
securities
business
in
1919
and had been associated with the
Exchange
as
a
member
or
officer
since 1925. He has represented the
Exchange in most of its relations
with other exchanges, corpora¬
tions arid
public authorities since
1933, when he became its Exec¬
Secretary, and is widely
known as an ' authority on the;
utive
practical as well as legal phases of
exchange administration.
•
/,;
Higher Stock Prices?
it
-
September while all other
types of construction were off
from $488.8 million to $326.0
A release from
:
Angeles Exch.
This is fun¬
ably, part Of this volume rep- rally in the face of, the prospect
resents foodstuffs and clothing that corporate earning power at
for relief purposes - which is best
^tyill,.; be /^'mixed?-—sharply
^financed through special ar- divergent industry /by / industry
mil-
in*
—
,,
the stimulus of- plans
has been in
economy.
damentally to the good, for gen¬
eral prosperity does not stem from
soft goods.
'
As a corollary to the business
readjustment, the prospect favors
a decline in wholesale
commodity
prices next year—with its conse¬
quent favorable implications as to
the cost of living and profit mar¬
gins. True, some of the major in¬
dustrial commodity groups—non-¬
ferrous metals, for example—will
maintain recent sharp
advances
stemming from decontrol. In other
cases, however, such as iron and
steel or
paper,
only individual
product / price
adjustments
are
likely; and in textiles, decontrol
will eventually mean lower prices.
Above
all, what with bumper
crops and
declining export de¬
mand, farm commodity prices—^
which are aq/ important; .segment
of the index—are likely to decline.
October, 1945, increasing
from $455 million to $881 mil¬
residential contract awards
1
v
the
evidence
since
Actual
have declined from $463.6
over-inventoried, a debatable
point, there is reason to believe
that soft goods sales will decline
that a buyers' market
is in prospect.
:
during
started earlier this year.
"
consumer
of
a
.
possible
if not corre cted-—will soon
high level. But what of
the trend from here out—hear-'
is at
r
the
to
high capital goods industries to their
has been set in motion which—
consciousness is
statistical reports, theoretically
;
/li^shfrtSi sheets,; suits, etc. But
if
extension
an
capital expenditures traditional role of
being the back¬
remains; normal growth, bone of our
5'buildiug; a correction of present ^ maladjustments in coming
months could provide the necessary incentive to renewed ac¬
tivity. For the time being, how/ ever, a -deflationary irrfluence
deflationary influence..
tion
\ year. True, much of the money
spent in recent years was for:
fe luxury goods rather than ne■5 cessities—and there therefore
Is still an untapped demand for
a
of
ably, V the building materials 5.
Exports: Although well below
manufacturers will enjoy a ban¬ '•
the wartime peak reached in
ner year in 1946—and contrac¬
1944—when lend-lease was at
V
,
of money
even
the
the war
years. And current difficulties
are causing a "pigeon-holing"
rather than indefinite shelving
of expansion plans. Thus, like
the sit u atl o n"in residential
3. Building Activity: Unquestion-
over,
/
and
limits of the recent trading
range is in prospect; (b) Unless
labor developments heighten the
coming recession, th«* eventual
upper
,
competitive pressures and high
'
■
remains
wide inventory
has spent a huge amount
!,
program.
thing, apart from the
wage rates require. moderniza¬
tion and expansion which was
<
Granted that the latter is par¬
| ; In the past four years, the consumer
corded
,
still
ticularly true of soft goods lines,
/
*-
one
VTrue^ the necessity for
level
purchasing
intimating a
ulatively hoarded) will proved
how much pressure they ' will
exert on the price ' structure
Policies:
Inventory
V
re-
visible inventories (goods spec¬
requires specific analysis of the
Consumer
bound to
agehtsralready are
buyers' strike. Secondly, the
pipe lines of distribution are on
the way to being-filled and it
is natural to await absorption
by ultimate buyers before add¬
ing : to stocks; Thirdly, it re?
mainsto be seenhow heavy in!
'
can
factors which determine the level
1.
markets is
in caution;
suit
:
the 1920's. Thus, any
to the business outlook
lof industrial production.
expenditure
For
>v
stock
New Era
are no more a
"make
•
the practical significance of
historical differences which
be cited is. open to question.
The 1940's
which
•
ever,
can.
factors
business," only a negative an¬
swer is justified.
;/'/•/'•
Of Los
be made that the present situation
is different in many respects from
the background which existed at
earlier critical periods/ jn, our
business history^;- Actually,t howany
other
ex-
W. G. Paul Named Pres.
What Makes Business?
.
planned
now at hand points
intermediate turn buying iopporreadjustment period in which tunities are being presented today.
the maladjustments created by a
CPA restrictions on industrial
sense
are
a
relative matter—
building, inflated costs are bungling, inefficient, administra¬
tion and a leap-frogging of wages
and monthly shipments as well
proving a deterrent to new con¬
and prices will be corrected.
as
new
orders
are
at
high
struction; a plant is worth just
In a sense, the background pre¬
levels. But how long can this
; V so much to do a particular job.
accumulation—with its conse¬
viously sketched suggests a busi¬
Secondly, the delays in ob¬
ness
LOS ANGELES, CALIF. —W.
performance which will be
quent stimulus to general busitaining materials and equip¬
a
/; ness activity#—continue?.; /
duplica¬ G. Paul was elected President of
■;/'
ment also have contributed to reminiscent—but not
*r
tion—of 1937-38. To express it an¬ Los Angeles Stock Exchange, at a
From
all Vindications,
the
abandonment of many expanmeeting of its
point has been reached where / sion plans—and the uncertain¬ other way, the severity of the re¬
Governin g
emphasis will be placed on re¬
ties in the outlook being re¬ adjustment will be greatest in the
soft goods lines; the capital goods
Board, accord¬
ducing inventories lest the sit¬
flected by the stock market
ing to an an¬
uation get
completely out of
will cause additional postpone¬ producers largely face a deflation
nounce me n t
in prospects. Thus, the highlight
hand.; For. one thing, the de¬
ments.
-.-V
;r--\'r0.."VV
of 1947 will be a return of the
by
McClarty
cline
in
the commodity
and
ital
inability to obtain all the items
for a completed prod¬
uct. Moreover, inventories in a
,
,
Moreover,
penditures in the third quarter
were at an even higher annual
.
necessary
full-
a
1941.
actual
some
as
liqui¬
dated and which wil cause
the
approximately $7 billion — for
$5 billion of goods was f rate—one which was some
/; Realism vs. Pessimism
*
'turned over to the government V" 50% greater than the prewar
Does the fact that a "deflation- 1947 lows
after V-J Day. Unquestionably,
peak. Since then, however, the
may not be far removed
background has changed and ary gap" is coming into being sug¬ from the October, 194# price level;
/ partial compensation for this
;
unprecedentedly high level can ; it no longer is likely that our gest that a severe deflation lies (c) Although there will be ample
be found
in increased; prices V" economy will have the stimulus ahead—that a major depression is time in which to become unqual¬
V of an aggressive corporate cap¬ in prospect for 1947? No! Rather,
and the distortions caused by
ifiedly bullish for the longer term,
optimists than to the
pessimists.
For one thing, successive waves of
liquidation have not made impor¬
tant or lasting inroads on
the
price structure. Secondly, despite
growing public awareness of and
emphasis on the uncertainties in
the outlook, the market has dis¬
played increased resiliency. Third¬
ly, only a market in tune with-
$2
addition to inventories has been
at
2645
surplus in prospect over the if not degree-—with the obvious
coming months? In the light of inference that: (a) The 1946 lows
the previous discussion of the
probably have already-.been re¬
Bust ?
billion,
Bobiti
;
$■:'J?£03- 'B'H A-
TJFIE COMMERCIAL &JFINANCIAL CHRONICLE
Number 4544 -]k
may
Lee
Higgmson Offers
Felt & Tarrant Stock
,
Lee Higginson
Corp. and Kid¬
der, Peabody & Co. headed an
underwriting group Nov. 320 which /
the next rally probably will be of
publicly offered 251,340 common
greater scope and duration than
shares, $5 par value, of Felt and
any witnessed thus far; in the sec¬
Tarrant Manufacturing Co., mak¬
ond half of the year.
ers
of comptometer adding-calThis, opinion is predicated on
culating machines. The stock was
the bqlief that: (1) An upward
priced at $24.50 per share.
^
movement is likely if only because
The offering does not constitute
there is such unanimity of opinion
financing on the part of the com¬
decline next year? If so, how far?
To answer these related questions,
that the worst is yet to be seen.
It is perhaps inevitable that the
pany.
In its 61-year history no
public offering of securities has
recession ever been made
by the company.
of a • business
be tested by higher prices.
(2) Apart from the fact that fur¬
concept
will
ther evidence of business deteri¬
oration is not in nearby
prospect,
The
shares
holdings
offered ; represent/
certain shareholders
changes in the / com¬
of
following
pany's; capitalization /and
the
price level is a realistic one
merging into
the
company
of
which permits reflection of any
Comptometer Co., which handled
favorable developments. (3) The
the sales and servicing of comp¬
news background may be in the
tometers/ throughout the United
process of changing—a rail freight
States. A total of 531,060 shares of
increase daily becomes more im¬
the new $5 par value stock are
minent, and the current specula¬
tive neurosis is overlooking labor's 'outstanding/;/:::/v|^^
the
Except for 1921 and 1932,. cash;
b'
dividends have been paid
the
Unquestionably, there has been company on its capital stock,
a major shock to investor confi¬
without
interruption, in every
dence. But even though this was
year since 1909. /Net income t of
also true in the fall of 1937, the
the company for the year ended
market nevertheless offered trad¬
Dec. 31, 1945, was $713,502 com-;
ing opportunities after the initial
pared with $951,195 for the pre¬
readjustment. To illustrate the
ceding year and $702,050 for the
poirif, after: a decline to 113/64 on six months ended June
30, 1946.
Nov/ 24 of that year to establish
The company's plant and execu¬
a
bottom which was not pene¬
less militant attitude. ; y-\:
tive/offices
for
at
are
1735
North
almost
were
three
trated
four months,
Paulina Street, Chicago.
j
upswings av¬
The company, it is 'stated, in¬
eraging 15 points despite sharp tends to make application to list
declines in the various production
the common shares on the New i
there
indices
and
commodity
Significantly,
-
prices.
While
an
exact
0. D. Belle & Co. Inc.
SYRACUSE, N. Y-r-O. D. Belle
parallel obvi¬ &
Co., Inc., is conducting
there /is
ously cannot be drawn,
to believe that market his¬
compensates for
Cash Government tory will repeat itself in substance
reason
York Stock Exchange.
eventual
bear
market bottom on March 31, 1938
was less than 15 points below the
November, 1937 low.
th.e
curities
business from
,
se-4
a
offices at
114 South Warren Street.
-
*
THE COMMERCIAL & FINANCIAL CHRONICLE
2646
mediate
Remedial Deflation Needed!
that envisioned
when the com¬
(Continued from page 2606)
(100 being the average of 1935- modity was not available. ,
'
1939).
'
Actually,
the
difference
be¬
From this it has risen to a level tween, shortages and surpluses can
of 182. With this rise,
however, be pretty thin. To illustrate this
has come a marked increase in extremely simple—if a commun¬
prices and some evidence of con¬ ity needs 100 units, let us say, of
sumer resistance in
a commodity and the sole dealer
buying. /
Some further increase in pro¬ in that community has only 96 or
duction should, be seen, under the 98 units there is a shortage and
recent
substantial
elimination
price controls. Manufacturers
against
a
of
new
(1939 the base of 100)
of 133 in August,
1945. A further rise in production,
however, should not lull us into
belief
a
in
stability
around
cur¬
Actually, it will prob¬
ably make the inevitable
justment more severe.
During the
read¬
Production
Wasteful
war we
had to have
vast
quantitative production,
wastefully or not. This wasteful¬
ness has, to a considerable
degree, that there will not be a broad
been carried over into peacetime repetition
of that phenomenon
this time.
production.
On
top of this the work week
All
has been reduced and with it the
was
just
about
a
year
ago
siderable
that President Wilson of General
the
with
basis
of
45-hour
a
discussion; at the
pres¬
is
Repub¬
a
may well be
modification of such policies; It
perhaps too much to expect
that,
to
give
,
would
to
from
me,
a
when the ballot count showed him'
to
be
the
winner
until Jan.
serve
in
the
publican' Senator^elect
pricker, starts
i
in
first
race
to:
3* at the time Re~John
a full term*
W.)
-
/ >
E. G. Schuessler, • special counsel1
the Attorney General's office/
their
.
„
.
,
,
^
<
-
■
,
\
<
.
how this
Kingsley Taft, Shaker Heights;
attorney, is already in Washing¬
ton, claiming: that his term -as:
Interim Senator: star ted Tuesdays
;
port group being, the largest loser
,
see
Senate;
Not. until Dec, 15 will Ohio have*
two Tafts in the U,- S. Senate, the*
Attorney General's office at Cq-lumbus, Ohio, said on Nov. 8, ac-;
cording to Associated, Press ad-;
vices, irom Columbus,; which tor:
ther stated;
1 \ ' vj
groups-lost 20%-45%
of declared that- Mr. Taft
couldn't'
price level-1—the air trans¬ take office until
the Dec. 15 ex-'
folly not to recognize what has
piration of the term of Sen. James
gone on in the stock market and —the second, or what we might W, Huffman, who was
.appointed-"
term non-boom groups, were off
to heed the signs.
L
last
year
by Gov. Frank J.
from 20% to 35%—or practically
Lauscne after
Those who counsel.otherwise*
the same. // ,//.
/'* •!'
ton resigned to
who say that the collapse in secur¬
go to the Supreme
The result has been to bring Court."'
ity market: prices
is
internal,
the second type of securities to a
rather than indicative' of diffi¬
;
Kingsley Taf t,di$tantly related!culties ahead, are assuming a re¬ price level much closer to normal to Ohio's senior Sena
tor, Robert
seem
be
workers
V It is difficult to
Two Tafts in U. S.
;
In the stock market decline the
any one to put his finger on the
sponsibility which careful men
virtually time
when,
speaking broadly,
ought not to assume, True, no
the same take-home pay that they
general shortages will be changed
economic sign whatever is infal¬
had been getting. This never re¬ into
general surpluses.
lible.
But, when we see a phe¬
ceived
even
reasonable
consid¬
After World War I, for example, nomenon
which, in all but excep¬
eration,"
while security prices reached their tional
cases, has been followed by
We have followed an opposite
peak in early November, 1919* and certain developments,, ho nest
policy. As a result, with the out¬
declined sharply into early 1920, counsel should
ppint to prudence.
put of both men and machines de¬
commodity prices did not reach
I appreciate that undoubtedly
clining^ production costs per unit their peak until wall into 1920
have risen and prices with them.
some
who try to explain away
and did not break sharply until
> Based on a- fair representative
tbe decline in the securities mar¬
the fall of. that year, - Whether
ket may' be, doing *so to eliminate
group
of industries, production in
this period there will be a sim¬
costs per unit of production/ at
what they think is unnecessary
ilar interval, or a quite different
the present time are 62% above
fear.
The difficulty is that it is
interval, it is impossible for any
the 1939 level.
likely to eliminate prudence.
one to honestly say.
Upgrading during the war was
There is nothing in the situa¬
All we -can do is to recognize
a much easier process than read¬
tion as I see it*" that points to dis¬
that" existing abnormal relation¬
justing^ and downgrading under
aster. There is much on which to
peace.
These troubles will prob¬ ships between costs and prices be extremely careful!
and
among
various prices can
ably not pass until headline mak¬
It would indeed be a major mir¬
ing "triumphs" of wage increases hardly be permanent but must be acle
if this country, couid come
are
replaced by the more solid readjusted, and to prepare for
through a war, and then through
such a readjustment.
and ■ lasting
factors of greater
A
|
J > ' - iv /> a year, of attempts to manage the
worker productivity- even if the
Comparison With Postwar Iv
economy/ without being face to
latter means working a little more
Period
face with the necessity of read¬
than 40 hours a week until indus¬
Now, I have not meant to give justment. But, following such an
try can adapt itself to postwar
the impression that current con¬ adjustment, we should go into a
conditions.
~
ditions are specifically parallel to period in which we will establish
rates
the
Signs of the Stock Market
It
,
,
in that way avoided? The reason
week, I think' is that it is impossible for
sufficient increase in wage
a
a
Congress, there
best
managed
companies,
Divergent Outlook for Groups
irather than being handicapped as
of Securities
they have; been in various; ways*
j There is, however* an interest¬ over recent years, will again come
ing divergence betweenvarious •into their own* This should be ingroups of securities, as there is the forefront of our minds, in the',
between
various
segments
of handling of money.
business standpoint, that it would
you may say to
ent time* why will not; past ex¬
periences he guarded against and
Motors made the constructive sug¬
gestion that we work, for a time,
on
"..
.
right, then,
me, inasmuch as we have histori¬
cal basis for that belief, and con¬
Work week of machines.
It
lican
competitive#,
labilities-^fif:;be^a$ ^ premium' aii&;
•
low
rent levels.
-
With the election of
inflationary;.. period;
a
«*iv
the
prolong the readjustment and de¬
lay recovery.
recovery/ but / hardly
bull market.
economy.
even with the recent change,
The war bull market Was pri¬
government will stand'aside* It
already has numerous commit¬ marily a bull market in consum¬
ments to provide support, particu¬ ers goods stocks, with the; stocks
every; one will be after him. But, larly in; the case of agriculture* of the; heavy industries, which
if the supply increases only 5% one of the most inflated segments wereproducing
the ^ country's
there is stock on hand and imme¬ of the economy. : • ;J.v
fighting equipment, by and large
lagging.
diately that is realized those who
| .t
/
But, one of the favorable im¬
previously hounded
the dealer plications of the recent election, in j .Tor use only a few groups as
will become apathetic.
addition to the longer range eco¬ outstanding,
illustrations,
t he
nomic
improvement
it
should liquor, air transport, drug, gro¬
Danger of Over Supply
bring about, is the prospect that cery chain and motion pictures
Certainly, history in this coun¬ the necessity for readjustment at their 1946 peak were from 100
try furnishes ample precedent for will be more
clearly recognized to 266% higher than in the last
a
pattern of postwar shortages and tbat it will more
generally be period of peace prosperity,-1936soon succeeded by sufficient sup¬
allowed to run its course* thereby ,1937, while such groups as rail¬
plies, if not over supply,;; Many of placing us on a sound foundation road equipment, the metals, elec¬
you men went through that ex¬
and iron
and
for a postwar reconstruction' bra trical equipment
perience after the end of World more quickly.
steels were from 5% to *20% be¬
War I. I see no reason tp believe
low such peaks. " ?. ;,
:
orders, at the end of September,
stood at 228
new
Thursday* Novemberv 21,1946
can
those
be
which
existed
in
1920.
new
high records of prosperity;
than the first group. For example,
the liquor, air transport, drug and
motion
picture,
groups
are
A.
Taft, of Cincinnati, based his
claim to immediate tenure on theSeventeenth Amendment to the1
Federal
Constitution.
still
200%-350% above the lows of the
Kingsley;
last period of stock market de¬
pression, 1942, whereas the metals,
Taft
quoted
the
amendment
as¬
saying the Governor could tem^
electrical equipment, aircraft and
porarily appoint a Senator "untilchemical groups are only 25-60%
the/
people
higher..'- ■;
J
;
Some stocks of good quality are
already reasonably priced, at least
,.
.
election."
b
from
an
fill the
;
vacancy
by
?
Mr. Schuessler said the tnterimSenator did not read the amendV
historical standpoint. -A
ment fully.
He said the provision
must he
reads "until the people fill the valevels, again
cancy as the Legislature may di¬
from an historical standpoint. !
rect."
•:■■'••••
This divergence should be rec¬
————
.}
ognized* It does not mean that i'/
there can be a bull market in
Orders
some stocks; with a bear market
Postmaster Albert Goldman ait-*
in general in progress. But, in the
few have reached what
termed under-valued
.
1
,
i.I
\ Philippine Money
•
noimced oh Nov. 7 that all
ppst
offices which were in existence
simply speculating
tin securities, it
is important to ;in the PhUippihe Islands prior ! to'
the war are authorized to
pay
recognize this distinction*
Moreover, it does seem logical money orders issued in the United
States.
to
However, money orders
believe that, when
we
get
drawn for payment in this coun¬
squared away for a real period of
postwar
reconstruction,
in
all try may be purchased at the Ma¬
nila Post Office only for the
pres¬
probability the most profitable se¬
handling
of
guished from
money
as
distin¬
ent.
curities will not be those that have
.
w
brought about without a period
L At the same time*' the PoistmasIf there is to be fear it ought to proven to be the most profitable
Broadly they are parallel, in that
of general readjustment.
in the bull market just ended, but ter announced that the limitation
we are in another abnormal post¬ be fear of delaying the readjust¬
War
dislocates and interrupts
of one parcel per week from the
rather the opposite.
war inflation.
Specifically, there ment and not getting to; a sound
the processes of production and
!■' This brings up a final consider¬ same sender in this country to the
are
important dissimilarities. basis for real and protracted pros¬
distribution.
Hence its end re¬
ation.. As regards individual com¬ same addressee in the Republicof
There
is
now
much
less credit perity.
sults in general shortages.. ; Some
panies, the boom ttaough whjeh ith.e Philippines will -no longerapstrain—and the credit situation is
of these shortages are real. Some
; Certainly a remedial deflation,
ply to packages and parcels con¬
we are passing has been largely
are only apparent.
The majority substantially under government or readjustment, does not mean a all-embracive. Government spend¬ taining
books, - magazines,
and
control.
are
each in some degree.
major depression, and probably
But
newspapers (but mot.other arti¬
ing was so tremendous and, as- a
In the most inflated segments of not' qven a minor depression. It
whatever their
character, they
result of government deficit fi¬ cles) addressed for delivery ;in
the economy there exists a strong¬ will of course entail a decline in
cause high prices.
that country. The announcement
nancing,. the creation of money
These conditions, which almost er financial position than 20 years activity* perhaps substantial. But,
was so extensive that almost any •tothej?'sgid:
*
ago.
The financial position of with industrial; output now 8Q%
universally follow war, also set in
enterprise, ;regardless of its finan¬
! 'Tft 6rd6r to help replace text!
motion counter forces to overcome corporations and individuals gen¬ above normal we could have a
cial background, or previous op¬ and scientific books destroyed in
material adjustment and still re¬
them
erally/is stronger."
erations under peace conditions, Philippines
during the war, as a
main above
j
'
Counter Forces '
j. One-very
important difference
prewar normals,
could make money*
:
? *0
temporary measure and until fur¬
is indicated by the relationship of
The necessity for oare and cau¬
In my opinion,
Unfortunately history s h O W S
the readjust¬ ther instructions, the limit -of
farm and non-agricultural prices. tion in the
current situation/ as I ment that we inevitably face will weight for legal* educational, med¬
that, in wrestling with the ab
normal conditions of an imme¬ In the 1920 period, using 1914 as see it, particularly from a secur¬ bring about a marked change in
ical, and scientific* -books (but hot
diate postwar period, we have had 100, farm products on the BLS ities market standpoint, is the fact that condition and when the re¬ newspapers,'
magazines; or other
index reached a level of 238; foods that, with the break-even point
a pretty consistent record of min¬
adjustment is completed the broad articles) addressed for delivery in
imizing the effectiveness of these 230 and all commodities except in industrial operations so much picture of the post-reconversion the' Republic of the Philippines,
counter
forces, the - greatest of foods 265, an even greater infla¬ higher tpan in the prewar period, period—'the period of postwar re¬ whether prepaid for dispatch cin
Which is the desire to return to tion. Now, using 1939, as 100, the a decline in production to a level construction—will be a high av¬ the-international prints mails or
production
and
distribution
in level of farm products is 248, food still substantially- above prewar erage level of physical production, in the parcel-post mails,/is in¬
products 220, with all other prod¬ normals, could raise hayoc with but with an intensification /of creased to 44 pounds
spite of all obstacles.
;.
per package
In addition, there is a natural ucts at 138. There is, therefore, earnings,
competition/; increased
business or parcel when addressed for" de¬
quite obviously not the same need
tendency for short supplies to go
It is, of course, illogical to-be mortality and a considerable de¬ livery in Manila and 22 pounds
for readjustment in the prices of
into hiding.
when addressed for delivery in
The result is that
gree of economic instability.
*
,
,
,
as
conservative on
the stock
mar¬
to manufactured, goods as there was
Approaching such conditions, an the provincial capitals or other
26 years ago. As. a matter of fact, ket, after it has given up 50% on
they are. A * con¬
opposite * investment* • or- specula¬ cities in the Philippines." ;
*
■
comitant tendency is an almost speaking. from a very immediate the average of a four-year ad¬ tive-policy fronv that / logically
inevitable over-estimation of de¬ standpoint, the ! controls recently vance in. five
monthsj as it. was pursued . over * recent years > is
T. L
mand*
removed, prices of some such before such occurrence,.
CSS. Admit
Never¬ necessary—namely, the avoidance
If you will stop and think a products should advance.
of most secondary or relatively Lester
theless it is difficult as yet, if we
Farley to Partnership
moment you will see that this is
Until recently at any rate, it
weak companies, from the stands
are
correct in believing in the
so.
Any one deprived of anything could be said that, as contrasted
point of what they were able to /Lestejr„ E. Farley will be admit¬
for a considerable period Of time with
the
1920-1921
deflation, a necessity for, a remedial deflation, accomplish under previous com¬ ted to partnership in T.. L. Wat-*
whets up a constantly increasing reasonable expectation was that to be optimistic on the stock mar¬ petitive
conditions, With * prime son &: Co., 40 Way Street, New
desire for it.
consideration given to the lead¬
But, if, when the the government would fight read¬
York City, members of; the N^w
ket from a long-range standpoint.
ers or near leaders in industry..
;
opportunity to satisfy the desire, justment,
would
attempt
to
A further intensification of the
eventuates, it is found that the cushion it—rather than let things
In
other
words* as we .get York.Stock.Exphunge,. 6n Nov.- 30.
cost is greater than anticipated, take their natural course. The re¬ currently
increasing production squared away after /the readjust¬ Mr. Farley has been with the firm,
actual consumption falls short of sults would probably have been* to curve could well bring an inter¬ ment from this immediate postwar, fon some
years as Cashier/w;'':
total
be
stocks
less
of
goods
appear
than
;
,
...
Volume
164-
Number 4544
THE COMMERCIAL & FINANCIAL CHRONICLE
extent
Is U.S. Military
Government
Deserting Economic Democracy?
fe
fe;'
..
fe
>
of
the
some
American
of-
Military
seems
to
U.
and
S.
that
be
if
French
the
all
Soviet,
deconcen-
Government that many pf
trate and decartelize each of their
stock
the British blocking of this
program will.be, to some extent,
these
corporations could be sold to
private individuals.. It is the USSR
vheory, however,A that once the
units have been determined,. a
very large amount of discretion
Should be given to the local - gov¬
ernmental
authorities
to
as
how
and to whom these business units
should
?
This
a
be
transferred. ■■;./fe
would
undoubtedly result
larger turning over of such
units to governmental authorities
in the Soviet Zone than would
zones,
ameliorated. News from this effort
should be forthcoming nearly any
day. •
In
an
interview with Mr. James
Martin, Chief of the Decartel¬
Branch, the ^'Chronicle"
was given the following descrip¬
tion of the aims and activities, of
that Branch:
Decartelization
"The
Branch,
one
of the most
,
fie vice
of
having
its personnel
drastically * reduced in number
every few months. The American
Military Government is trying to
ck* fe with
approximately
6,000
people, to be reduced in a few
months to 5,000,- what the British
Military
Government
is
doing
with approximately 26,000 people.
The above statements regarding
jthe Soviet position on decarteliza¬
tion and deconcentration, how*
cartelization
of
but
tightly'
con
trolled.i
German econ-J;
The pro-fe.
James S. Martin
gram is based7
squarely upon
paragraph 12fe of the Economic
Principles
of
Potsdam
which
omy.
ate the
that
earliest
prac¬
ticable date the German economy
do not apply to the recent
that some of the larger
shall be decentralized by elim¬
inating excessive concentrations of
economic power as exemplified in
taken for reparations will be left particular by cartels, syndicates,
by the Russians in their Zone and trustsfeandother monopolists arfe
will be aggregated into huge in¬ rangements. Paragraph 3, section
dustrial groups to produce for the (ivl of the Political Principles
Soviet On this U. S. decarteliza¬ also serves as a very general but
tion officials have no comment to nevertheless, direct guide to the
ever,
rumor
German
concerns
which could be
make for the present*
Decartelization?
.
Because of the various conflicts
Branch
that
in
that have arisen in the implemen¬
such section charges the occupy¬
ing forces with preparing for the
tation of the Potsdam Declaration
eventual
reconstruction
of
Ger¬
concerning the elimination of ex¬
cessive concentration of economic
many on a democratic basis.
quadripartite law on this
subject has been very slow "ab¬
orning." Pecularly enough, in this
porate and other industrial prop¬
erty fall squarely .across the high¬
way
Which-/ the DecarteHzatiqn
power,,
case
is said to
the hiatus
be be¬
tween the British on the one hand
Soviet-andf French
and the U.
on
the other. The Decartelization
Branch of U. S. Military
Govern¬
ment has, therefore* been
"Billions of Reichsmarks of
cor¬
Branch must hew out of the Ger¬
forest
man
•
which
Names
the
Branch muste conjure with are
I. G. Farbenindu$triei A. G., prp&?
ably the world's largest dyestuff
ordered
T>y Ltv General Clay to proceed
immediately with a program for
Vereinigte
Stahlwerke, A. G., the huge steel
decarteliza¬
annually prbdudM nearly twice
the 5,800,000 tons'which it is now
proposed should"Be the total an¬
nual production for the entire
German steel industry; Siemens &
Halske, which had sales of over a
deconcentration
and
tion in the U. S. Zone. A unilateral
•program
has been* prepared by the
U.
S. Decartelization Branch
is
and
now
being coordinated with
/ "various other divisions of U. S.
and
chemical concern;
combine
which,
before
the
war,
Military Government. The theory
billion
MSD District 13
ticipated in over 2,000 cartel and
patent agreements and controlled
hundreds of foreign and domestic
subsidiaries; the. Hermann Goering combine, whose notoriety is
Committee Elects
Reichsmarks
a
par¬
year,
internationally-known' and meeds
The following have been elected no .further comment here; MetalL
fefebyfe District No. 1&' Committee- pf gesellschaft, AfeG.; a light metals
the National Association of Se»% and chemical fee o n c e r n; AEG,
curities Dealers, Inc., to serve for another huge electrical concern,
three year;Jerms beginning Jan. and; hundreds fe' of Mothers.
The
^
,
-
,
16, 1947:
For Board
Jerrold Bryce,
Governors
T.
of Clark, Dodge &
For District No. 13
Committee—
F. Blaine, of Goldman,
Sachs & Co., New York, N. Y.;
Charles P. Cooley,. Jr., of Cooley
Walter
•
&
i
Company, Hartford, Conn.^ R,
of The First Boston
"Recent
ning Jan. 16, 1947:
fefefefe
For District No. 13 Committee
Richard F.
Abbe, of Van Tuyl &
Afobe, New York, N. Y.; John F.
Wark, of Merrill Lynch, Pierce,
Fenner & Beane, New York,.N. Y.
.
German cartels and monopolies.
Following World War I, the Ger¬
man
economy became more and
Corporation, New York, N. Y.;
Oliver J. Troster, of Troster, Currie & Summers, New York, N. Y.
following are duly elected
serve a one-year term
begin¬
has
amply
-eliminating
history;
showp the need
of
-v- The
,
•
on
/democratic
a
basis,
-^fefefefe^'fefe
f of
One
the fe most
-■
other
efforts
is to convince the Ger¬
overcome
voting
man people that
democracy, par¬
ticularly economic democracy, is
most
the
full
medium
an
possible economic
in
which
of
cess
for
complete develop*
individual. The Ger¬
must he convinced
mans
best
favorable
and'
meat of
the
the
that the
system is
material
individual
suc¬
depends
primarily on his own ability to
satisfy the economic requirements
of
others; that the resulting phil¬
osophy
of
of
the
individual
is
one
self-reliance,
self-confidence,
modified by the necessity to ad¬
just and contribute to the needs
of
the
community. It is assumed
that such
an
individual will
exer¬
cisean alert and; effective; control
over
his government
and will
compel that government and its
officials
to
act
for
the
general
welfare rather than in the inter¬
ests,*#
special class. Just as
other branches of Military Gov¬
some
ernment must convince the Ger¬
many
ing
a
concentrated
in
the
hands
few individuals and financial
institutions.
This
concentration
had gone
far beyond mere owner¬
ship or possession of the means of
production. It had become tanta¬
mount
to
irrevocable grant of poli¬
a dictator, the De<^rtel±zatipnfeBranch must con¬
vince the German people of the
unsoundness
of
making an ir¬
revocable:
grant
of
economic
power, to private persons, agen¬
cies;; or to a dictator.
economic
empire
and
'The
Branchy since < it started
January, has been investigat¬
ing, and studying different seg¬
in
ments
of
the
German
also
actively
Divisions
in theiT
prohibit banks from
shares of stock. The big
six banks
in
Germany (Deutsche
Bank,
Reichssreditgesellschaft, Berliner HanDresdner
delsgesellschaft,
Reichs
Commerzbank,
at one time voted
Bank)
the
controlling shares in an over¬
whelmingly number of the largest
industires
in
Germany. The
! Branch, in cooperation with the
Finance
also
ness
for
Division
of
OMGUS,
is
studying the insurance busi¬
in Germany in preparation
recommendation
a
as
to
how
thefe insurance
giants
shall
be
Many other companion
and regulations have been
reated.
aws
plemented.
"Daily problems of the Branch
multifarious and complex and
the
gamut from
a
period of pre¬
paration for the tremendous task
of
a
eliminating giganticism in
industry." The number
Ger¬
man
size feof
the
residual
and
industrial
;
units of production
and their re¬
lations to each other will be con¬
ditioned by factors of
technological
efficiency
and
economic
need.
Pastoralization of Germany is not
the goal, since it is intended that
industrial units of substantial size
will
survive. The deconcentration
decartelization program will
and
be
correlated
with
the
over-all
Military Government plan to es¬
tablish levels of industry, select
plants
for
reparation,
destroy
Germany's war potential and re¬
organize
Germany
on
cratic basis."*.,-,
of
demo¬
a
vV■
fe
♦Although ONGUS, despairing
quadripartite agreement, had
drafted
a
decartelization
law
for
ican
of
zone
Germany at the time
the
"Chronicle's"
correspondent
was
in; Berlin in;
September, the
law
has
distribution
systems, owershipt patterns, tax
questions,
corporate
structures,
etc. to
the Branch is in
won* of
preliminary stage,
early promulgation in the Amer¬
are
run
questions.
"The
drafted and the German economy
is being studied to determine how
oest such basic laws, can be int-
not
yet. been
pension, insurance} export-. reported from Berlin
issued,
as
at the time.
economy
"State within
a
State.**: The
(Continued from first page)
London have arrived at the
con¬
clusion that Britain could not pos¬
dependent owners; and, second,
by prohibiting practices which
will allow such
new
units to again
either gain theif former size or to
obtain the
results of that
through concerted action.
size
"The Branch, in its quadripartite
efforts, is represented by its Chief
tion
results, the
British: Govern¬
ment would have had to face the
dilemma
of
for- its
spent, in 1950, normal trade
ditions would return.
Quadripartite
Deconcentration
G.
I.
which
;
Farben feCpntrolf
Officers;
has been seized by
the Control Council and is being
concern
given' special attention to insure
that its final
dissolution will re¬
sult in completely new ownership
It
was
con¬
anticipated that Britain would not
be
compensated
the
immediately
advantages
of
by
multilateral
/The temptation to
lateralist policy
of
pursue
bi-
a
at the
even
cost
offending the Washington Ad¬
ministration is undoubtedly strong.
But it need not come to that. For
it is
now widely expected that the
Republican majority would never
endorse /any
really
substantial
lowering of the American tariff
wall.fe; And in the absence of such
a concession, Britain would be at
.liberty to refuse to accept the
multilateral
y non
system without in
discriminative
-
way going
undertaking which
given on the condition that
there would be substantial tariff
back
any
her
on
was;
reductions.
;
,
This is the way in„ which pros¬
pects are viewed from London.
Should the rise in American prices
reductions.
If there should be
a
slump in the
United States, the contraction of
demand by the home consumer
would make it appear all the more
trade for relinquishing the
privi¬
leged position in the sterling area.
important to avoid the encourage¬
ment of foreign competition in the
But the view
domestic market.
taken that her
was
In boom
or
in
arising:from the slump, tariff reductions are certain
change could 'easily be met for to encounter strong opposition.
five years, or six thanks to the dol¬ And with Congress controlled by
■the Republicans, that .opposition
lar loan.
trade deficit
The
unexpected
increase
of
prices, in the United States brought
number of persons.
"The Branch also
circles
on
it would entail.
fully
patterns with the control of the
pieces of the former I. G. Farbenindustrie spread over a very large
carries
a
was
and
Law; the other, the Committee of
*
result
of
Britain would have to put
which
as
,
sake; themail argu¬
that, thanks to the continue, American industrial in¬
American loan, Britain would be terests would grow increasingly
in a/position/ to put: up: withfethe apprehensive of foreign competi¬
tion in the home market.
They
temporary costs of the multilateral
system during the reconstruction would mobilize all their influence
to prevent any encouragement of
period, and that, by the time the
proceeds of the loan have been foreign competition through tariff
own
ment used
and its Assistant Chief
on Legal
Quadripartite
Policy, Mr.
C.; R. Coleman, on two Quad*
ripartite Committees, one, a Work¬
ing; Party which is negotiating, the
-
discrimination,
sibly: afford to adopt multilateral up with her badly balanced trade,
trade. But for the American elec¬ iit spite of' the loss of dollars that
choosing
between
a system it considered to
etc., and has now begun the inten¬ be
contrary to the fundamental
sive study of specific companies
economic interests of the country
which; are. either outstanding in
and antagonizing American opin¬
their size and; complexity or are ion
by backing, out of an under¬
notorious for their discriminatory
taking entered into quite recently.
and
economically vicious trade As it
is, it is: now- expected in
practices. German participatioit in
London that the advent of a Re¬
international cartels will, of
publican majority in both Houses
course* be, given special attention
of
Congress
would
effectively
German economic penetration
prevent the Administration from
abroad by such means must be
pursuing the liberal policy in¬
prohibited.
spired by Mr* CordeR Roll's free
'The final efforts of the Branch
trade doctrines.
will culminate in reorganization of
When in December 1945 the
large units of German economy;
first, by reducing the size of many government allowed itself to be
persuaded by Lord Keynes that
of these concerns and placing the
multilateral trade is? a good thing
new units
into the hands of in¬
about
change of views in this
a
respect. It is
now
that,
as
feared in official
a
result of this
of the loan
is expected to be effective.
Rightly
or
wrongly, this is the
view that is taken here.
reason,
For this
the announcement of the
Administration's
intention to
ne¬
gotiate sweeping tariff reductions
has failed to create any profound
would be exhausted by 1948.
And
impression in London.
Whatever
nobody seriously expects that in¬
.the
Administration's
intentions
ternational trade conditions would
become anything like normal by 'may be, the fact that it is now out
'
of sympathy with Congress is con¬
1948..'
rise,
the
proceeds
fefefefe
The
fe';;-
sidered
to be of
decisive impor¬
intensified
try/ all of the. restrictive practices
export
drive tance^ And suggestions that Conbrings in much sterling but very
Igress would back up the Admin¬
few dollars.
It is feared1 that in
istration's foreign trade policy as
a year or two Britain would be¬
it is willing to back up the official
come a large
creditor to Europe foreign policy are viewed with
and other countries of the Eastern
much skepticism.
fe
-' * • <*1V
Hemisphere, but she would in¬
of
crease
System intrqduped^ Qpnsultatipns
are
also proceeding
the
gasoline and Diesel oil dis-
in regard to
tributing cartel. In the coal indus¬
the
huge
Kohlenkontor
at
Mannheim, which distributes all
of the Ruhr coal in the U. S. Zone,
have
been
eliminated
have
been
made
limitation of the
centrations, was commonly referred
Britain and II. S. Elections
suchy as metalsy fuels, chemicals,, adopting
of that
con¬
ifefe'ifefefe'T fefer/; 'jfeii aX/3^1, j;;
zonal
is
to
Bank,
import, price, financial, and inter¬
an
Farben, the largest of these
as a
OMGUS
pf the unsoundness of mak¬
private business government. I. G.
tp
Branch
negotiating the acceptance of a
aw requiring the
registration of
bearer
shares,
and
supporting
to
will
will
objective.,*,.,
"The
have
hurdles the Branch
the
confident businessmen
-
be the
difficult
has been
charged with 'negotiations with other occupying
proceeding against these giants powers in special cases. With the
their unfair and dishonest British, feAgreement
has
been
practices
,|^^a^uadripartite reached that the grease and lubri-,
basis and on a Unilateral basis in
eating oils distributing cartel will
the U. S. Zdnfcps**/:
'vfefefefe
be abolished and a competitive
more
to
Germany
<•
and
Parker Kuhn,
'
of
Branch
of
Cq., New York, NiY.jWilburG.
fe Hoye, of Chas. W. Scranton & Co.,
'; New Haven, Conn.
-
world
self
2647
tical power.to
the vast
states
both to the peace of the
and to the reconstruction
menace
one
S.
ization
recently organized
probably be contemplated in the (Jan. *46) major units in the Of¬
II. Sk Zone, though this is not en¬ fice of Military Government, U. S.,
tirely clear. However, in the U., S. is charged
Zone thevarious Laender Igovr with o n e Vi of
ernmentsi" also, will undoubtedly the most dif¬
be given large amounts of discre¬ ficult
assign¬
tion asfeto how the actual imple-t ments given
to any branch
mentation of any decartelization
of Military
should take place.fe M fac^
American Military Government is Government,
forced • to turn over more and which is the
more of its duties and responsibil¬
deconcentra¬
ities to the Germans by the mere
tion and de¬
'
a
(Continued; from page 2616)
units and have stated to
facials
of this power and control
remains enormous and constitutes
group.
...
a
for
area
and
plans
the
severe
of activity
It is possible that
...,
.
.
cooperative wilt be formed
.
in
debts
to
the
Western
The Carlat Co. Opens
Hemisphere.
To avoid this, British statesmen
; are thinking increasingly in terms
of bilateralism. The declared pol¬
icy is to endeavour to reduce im¬
ports
from
the
Western
Hemi¬
sphere and to divert exports
from
the 'Eastern
Hemisphere. ^ This
its | could
not be done to any substan-
WHITESTONE,
Carlat
Co.
is
JfeN.
-
Y. — The
conducting
an
in¬
vestment business from offices at
153-16
are
Tenth
Avenue.
Partners
Robert Labsor^ Thorstenfe An¬
.,
place. Again, private, independent,
2:
,
her
tial extent under a
fefe*'* i
nori-.
regime of non-
if 1 f f\
derson, SergeTrey, Rudolph Russo
i
and James V, Traina^.
Ju
2. 1
ii. ti.
,t
LC
a
u
fe. ;fe
I. ii.:
;
THE
2648
COMMERCIAL & FINANCIAL
Thursday, November 21,1946■*>,
CHRONICLE
now stands at enough period to be characteristic.
Interest rates and the Money;
approximately $24,000 million, • 7
Supply Factor do not altogether
The Money Supply Factor
coincide in the above graphs dur- ythe present time. However, in the
These seven factors have an in¬ ing the years 1926 through 1932 '
1920's
and
on * until
1935, re¬
terrelation one upon the other in for
two
reasons.
First, interest 7
quired reserves averaged a little the
supply and use of credit. The rates do not react quite as strongly
under 5%. From then on a grad¬
first five determine the supply of as
the
supply-demand
factors *
ual increase was noted until a
the hard money credit base, the themselves
as
reflected
irr the
peak of about 14% was reached last two determine the demand for
Money Supply Factor, but, never¬
toward the middle of 1942 and
credit.
From this the following theless, follow the major trend.i
before government deposits were
formula is obtained;
Second, this graph is on an annual %
greatly enlarged to finance the
basis
instead ; of
showing
the 1
war. Reserve
requirements tend G + T—m>-C)—Q
monthly
changes
which
more
=
F
to restrict credit in the same man¬
R
closely
parallel
interest
rates.
withdrawal of
cing program and
Havd Money
of
*
(Continued from page 2613)
ditional amount that can be loaned
less, so that for practical
it is regarded that 10 to
times is about the maximum
12
.
Now,
^effective credit expansion.
one
of
bank's depositors de¬
cash so with¬
the
cides he wants some
draws some of this
as
gold, or silver
the case may be, from
and in
so
the bank
doing reduces the
origi¬
$100,000 that the bank oper¬
ated upon. Thus, if all of the $100,000 had been used for the making
of loans and had been expanded
nal
practical limit, some loans
have to be called to meet
this cash withdrawal, or if it had
not been expanded to its fullest
extent the potential credit expan¬
sion
provided by the original
$100,000 would, be,.reduced pro¬
to the
would
,
portionately,!1 Although thiis is a
very simple illustration and does
not compare with the complexity
certificates
silver
and
out¬
standing,
subsidiary silver and
minor coin, United States notes,
and those national bank notes and
Federal Reserve Bank notes for
the retirement of which
funds
have
been
deposited with the
Treasurer of the United States.
This factor, although smaller, has
the same function as gold, and
ner as a
currency,
taken
together forms the Hard
but only to the extent that the
Money base for credit expansion.
reserve
requirement percentage
There has been a gradual rise in
reduces the hard money base; that
this component from just under
is, at the present time 10.75% of
$2,000 million in 1926 to current
the total gold stock plus treasury
levels of about $4,500 million.
currency.
Currency in Circulation—From
Loans and Investments—Loans
1926 to 1930, currency in circula¬
and Investments in all banks in
tion' declined Very slightly,'; but^
the United States indicate the use
rose to small peaks in December
of credit. It is of course recog¬
of each; year for/the ^Christmas
nized 7 that
investments >7 in the
season; • At ? this
time the level
form of bonds are no different
stood around $4,500 million, but
than loans except that they have
as
the business depression pro¬
Treasury
becomes
purposes
Theory of Interest Rates
which
notes of 1890 are
,
After
where:—
G
=
Gold
million
1934).
'
7 . Currency
Outstanding. ;. '
•
;;
Money in Circulation.
;
Legal maximum collateral
of eligible paper and goyernment securities behind
Federal Reserve Notes out¬
=
1
v
M
=
C
?=
.
Treasury
standing.
Q
lower
,
.
T
1932
the
inflow
of
gold
greatly stimulated the Money Sup¬
(minus $2,796
ply Factor and this was gradually !
A after
January, reflected in
rising bond prices or
stock
never
achieved
high mark of the Money Sup- I
ply Factor in 1940. In some re- I
spects it is fortunate for, the^
Treasury Department that interest
rates on the highest grade bonds
the
.
T>aTallel "the -supply of f
because, if they had, long 7
Treasury bonds at the begin¬
ning of the war would have car¬
ried about 1% coupons and by the i
did
not
credit
,
reserve require¬
ments of hard money,
Average
yields, but it will be noted
that interest rates
term
■
a
longet maturity. These rose
in
day banking, never¬ gresses - m ore." currency
I = Loans and investments of
note d
and! from about $50 billion to about
fundamental principles circulation >• was
all banks in the U. S.
end of the war this rate would
a
sharp * bpt
temporary
rise $60 billion from the beginning of
are inherent
therein and can be
1926 through 1929. Subsequently,
R == Reserve Bank Credit out¬ have risen to about the 2*4%
to
$6,711
million occurred in
applied "to the A more complex
standing.
they declined to about $40 billion
level. If this had happened the A
structure* On these ;prihciples is March, 1933, during the banking
F = Money Supply Factor.
Treasury Department and
the 7
However,
as
deposits early in 1933 and stood at only
based the Hard Money Theory of holiday.
about $50 billion as late as the
In relation to.the trend, of this Federal Reserve Board could not
continued to mount by reason of
Interest Rates.
end of 1939. Since then this figure
the inflow of gold, currency in
money
Supply H factor we have claim quite such a good record in.
•Hie Trends of the Credit Compo¬
circulation
^also Continued
to steadily mounted until it stood at shown its relation to Moody's Aaa their financing job.
nents in the Past 20 Years
approximately $140,500 million in bond yields on an inverted scale
However, the great potential of s
mount, until by the beginning of
Gold—Until 1933, gold flowed 1940 this factor stood at $7,500 January, 1946, The trend in 1946 to the right of the graph. (Be¬ credit existing, at the beginning of A
been
somewhat. downward cause of the *
freely in the settlement of trade million. The wartime conditions has
logarithmic scale the war explains why the govern- *
| balances between nations and greatly accelerated this trend so due to the redemption of Federal either short or long term rates ment was able to accomplish the 7
throughout the United States to that by the end of 1945 currency debt but such reduction has al¬ could be used, but Moody's is unprecedented fact of financing a
most been offset by an increase in most convenient.) The reason for
carry on commerce and banking. in circulation stood at about $28,major war (arid it was by far the 7
From 1926 through 1930 the level 500 million. It slipped off in the commercial borrowing.
this inversion is of course rather greatest and most expensive in •
fluctuated within narrow limits first part of 1946 but by the end
Reserve
Bank
Credit
Out" obvious because as the supply of history)
on
declining
interest
around $4 lSillion. In 1931 to 1933 of the year has exceeded its pre¬ standing—As an offset to Loans credit
gets A larger it naturally rates. This is one major fact to7
inclusive the variation was a lit¬ vious top by a slight margin. This and Investments by commercial leads to the fact that interest rates prove this theory is correct, and 7
tle wider because of the extreme is a negative factor in the hard banks, the Federal Reserve Banks get lower and by so constructing the above graph mow shows that 7
rediscount commercial paper from the graph the two lines tend to this credit potential has just about
maladjustments caused by the money credit base.
It been exhausted at current inter-*:
business depression.
Federal
Reserve
Notes—The their member banks, purchase move in the same direction.
As a forerunner to ensuing de¬
will also be noted that both of est rates.
bulk of our currency outstanding bankers acceptances, and buy and
velopments, the holding of gold is made up of Federal Reserve sell government securities in the these: graphs are plotted on loga¬
As a result, we have had the
rithmic scales. This is so that no second
by anyone other than the govern¬
major proof of this theory
Notes, in denominations of $5 or open market. Such action has a
ment was prohibited in 1933.
All
dyrect bearing upon member bank matter how high the Money Sup¬ occur during the past six months.
larger. The original Federal Re¬
gold had to be turned in to the serve Act provided that the 100 % reserves in that while the Federal ply Factor goes, interest rates can Government and other high grade 7
Reserve Banks could pay cash for never get to be a negative figure
commercial banks in exchange for collateral
bonds
have
declined
sharply. A
pledged for notes should
I an, equal amount of currency, the consist of eligible paper repre¬ purchases in the form of Federal but will approach zero as an especially in the longer term ma- ~
commercial banks in turn were
Reserve
notes,: actually, under asymptote.
Conversely, as
the turities. In the short term money »
senting
discounts
by
member
required to ship all the gold they banks, but permitted the Reserve normal conditions, they pay by Money Supply Factor gets infin¬ market several of the large New
had to the Federal Reserve Banks
means of their officers' checks on
itely small money rates will get York banks in July increased their
Banks to reduce their liabilities
and receive deposit credits, and
themselves. These checks are de¬ infinitely large. As thought is de¬
rates on call money and bankers
for Federal Reserve notes by de^
the Federal Reserve Banks had to
posited by the payees to the credit voted to this problem it is of acceptances and other banks have
positing gold or lawful money
turn over to the government all
of their accounts and eventually course easy to see that this is what
since followed suit. Further de¬
with their Federal Reserve agents.
of the gold they held in exchange
return to the Federal Reserve would actually happen in these
Revisions of the law provided in
velopments will, we believe, sub¬
for gold certificates. This scheme
Banks that issued them—in the extreme cases.
stantiate this theory, but these
1916 that bills bought in the open
has prevailed ever since and al¬
majority of cases as credits to the
Inasmuch
as
both of these two
developments
are
proofg
market, and in 1917 that gold,
member
bank
reserve
account. graphs are plotted on logarithmic
though gold does not flow freely
enough for us, and we trust for
gold
certificates
and member
in commerce its function in the
The converse is true when they scales they can be placed one
bank promissory notes could be
our readers also, that these seven '
sell.
Ordinarily,
payments re¬ upon another in any convenient factors are the prime factors gov¬
banking system nevertheless is
deposited as collateral • against
the same. A major change then
ceived are in the form of checks position for comparative purposes.
Federal Reserve Notes. The Glasserning credit conditions.
occurred on Jan. 30, 1934, when
drawn on member banks;
and Arbitrarily then the average of
Steagall Act passed in Feb., 1932,
What then is the outlook for the
the President signed the Gold Re¬
when these checks are collected Moody's Aaa bond yields from
provided for the use of Govern¬
future of interest rates? If the!
serve Act devaluing the dollar or
1926 through 1932 and the average
ment securities as collateral for a the result is a reduction in mem¬
components of the Money Supply
of the Money Supply Factor for
raising the price of gold from
period of one year; this provision ber bank reserve balances. This
Factor continue their trend to¬
$20.67 per ounce to $35.00 per has been periodically renewed.
this same period have been made
ward lower, levels, interest rates
factor ranged from $1,000 million
ounce. The gold stock on Jan. 31,
to coincide. This seven year pe¬
The Federal Reserve Act further
will surely rise. Therefore, the :
1934, amounted to $4,033 million provided that the Federal Reserve to $1,500 million between 1926 and riod was chosen because it was
question resolves itself into what
so that in the process of revalua¬
Banks should have reserves of the end of 1932 and then jumped prior to the great changes in the is the outlook for the seven com*
tion the government made $2,792
gold certificates equal to at least to rang£. between $2,000 million money market beginning in 1933. ponent forces?
million by the increase in the
It begins with what many statisti¬
40% of Federal Reserve notes in
and1 $2,700 million until the mid¬
The following graph shows the
cal series
consider a somewhat
price of gold. This action of the circulation and to at least 35% of
dle of 1942, This was substantially normal year, it includes the boom change in this Money Supply Fac¬
government
announced to the deposit liabilities. In July, 1945,
tor as worked out by the above;
world that the United States stood
the 40% reserve for Federal. Re¬ increased during the - war to bol¬ year of 1929 and depression year
formula from 1926 through 1945.
ready to purchase gold from any¬ serve
notes
was
reduced
by ster the Government's war finan¬ of 1932, and it covers a long
one at $35 an ounce and it found
Congress to 25%,
i
1
}
i
l
1
1
1
*
I
I
i . I
r:-i 7,-1
I
many sellers of the yellow metal.
Inasmuch then as a legal por¬
Gold began to flow into this coun¬
tion of Federal Reserve notes may
' .*
J>. /
try. By the first of 1936 the gold be made up of commercial paper
of
modern
theless the
>
.
:
.
.
,
billion
mark and in this period another
development was occuring in Eu-
stock had crossed the $10
f rope which hastened the flow of
gold. Hitler was rising to power
in Germany, and as his strength
and
government securities and are
backed by hard money,
not entirely
.
•
200
this maximum
legal requirement
must be deducted from currency
in circulation before its deduction
in turn from
K6ney Suppl
Money Supply
Factor
the credit base of
and the war clouds gathered, hard money. The trend of Federal
large amount of gold found its Reserve notes
outstanding has
A haven in the United States until
closely followed the trend of cur¬
the peak was reached toward the
rency in circulation.
end
of
1941
at
approximately
grew
a
$22,750
million,
the
then
From
end
of
1945,
on
gold
and
until
was
shipped out of this
country
balances
because
to
trade
settle
most of our imports were
for cash
exports were lend
shipments where no cash
settlement occurred. At the end of
but most of our
lease
1945 the
gold stock stood at about
$20,000 million, but during 1946,
especially in the first quarter,
some gain in the gold stock was
witnessed,
cggA ,.>77/7 77
7.^
Reserve Requirements—Reserve
requirements are set by the Fed¬
eral
Reserve
for
all
member
banks.
At
the
present
time
re¬
requirements are 20% of
deposits
for
member
banks in the central reserve cities
of New York and Chicago and a
serve
demand
like requirement in other reserve
cities.7 A 14% reserve is
of country
required
banks. A 6% reserve is
required of all member banks on
time deposits. No reserves are re¬
quired on government deposits.
Treasury Currency—This item
The average for all banks in the
comprises standard silver dollars,
silver bullion against the pledge' United States is about 10.75% at
1926'27 '28 *29, '30 '31 f32 '33 *34
'34 '36 ,37_138^39 M0
I41J42X43.J44245.
Volume) 164
Number 4544
THE COMMERCIAL & FINANCIAL
CHRONICLE
Marketing Official Sees Need for Food Stamp
Plan lb Meet Impending Crisis in Agriculture
(Continued from page 2619)
ployment or reduced
Mr. Hainan believes.
The
incomes,
situation
with
regard
2649
The America oi Tomorrow—An
Optimistic Outlook
(Continued from page 2605)
living, and our continued pros¬
perity. '
'
to
Let
market
in
<
quantities
exceeding
insurance.
those of before the war—in Sep¬
tember, shipments of washing ma¬
there is
With
no
far-reaching
me
this
danger of
protection
sudden and
a
curtailment
of
indi¬
repeat the one fact of chines, vacuum
cleaners, electric vidual income. •}
Long Island potatoes came to which we must not lose
sight; This ranges, radios and gas ranges
I am sure that none of us
would Viewed from the government light when it became known that country is now
were from 20 to>50 % above pre¬
experiencing the
want to abandon the Social Se¬
angle, the problem might be met, a women's civic group was anx¬ greatest period of prosperity in its war levels.'
l\
curity program.
•
v
Mr. Hainan has indicated, by the ious to obtain some of the surplus nistory.
Private building construction is
Another cause for economic as¬
use of the Food Stamp Plan where¬
they knew to exist for certain
It is important that we focus at the
highest level since the '20s. surance is found in the
operations
by surplus foodstuffs may find, welfare institutions in which they Our. attention on this fact—because The
output of many building ma¬ of the Securities and
Exchange
their way to the lowest income were interested. The publicity the it is the key to the formulation
terials reached new postwar highs
Commission,r Through its. protec-h *
groups or, in the event of actual matter received had the imme¬ of our fiscal .program.
in September; some reached all- tive
services, investors in securi¬
widespread unemployment; to the diate effect of letting people know
time highs.
ties are more certain of the sound¬
the
availability
of the Determining the Level of Taxes
unemployed. Some such device about
The production of lumber prod¬ ness of their
investments today.
will certainly be necessary if the potatoes who had been wholly in
Consideration must be given ucts in
September was 135% of
There have, perhaps, been ex¬
nation's surplus food crops are to the dark on the question before. our present prosperity when we
the 1935-39 average.
cesses
of
speculation
in
some
be utilized in the future, Mr. Hal- It seems that only the large, well- come to determine the level of
; Civilian employment has in¬ areas; but, due to safeguards es¬
nan is convinced.
organized welfare agencies who taxes which may be maintained at
creased 4,000,000 since the end of
tablished, the over-expansion of
have
paid help to notice such this time without imposing undue the
The particular angle of the farm
war, and was approximately
credit in this field
during infla¬
things knew about the existence restraints upon enterprise.
The 57,400,000 in' October.
problem posed by the demand of
tionary times has been held to ay
and the availability of the pota¬ amount of our revenues
the farmers for parity prices for
will, in
And yet there exists the greatest
minimum. V •'..v
toes.
'}
} ;.
Perhaps the demand for turn, determine the surplus *tha t
their crops
demand for every product of the
,even in the! face of
The liquid assets of individuals
Long Island potatoes is greater can be applied to the reduction
\huge surpluses — will also be¬
manufacturer and the farmer. Our are now about
than
$190,000,000,000—
commonly supposed since pf our public debt.
come -complicated in
*
,
present production,-despite its rec¬ an all-time high.
the years
This compares
On the fiscal side of the*
many} inquiries concerning the
pic¬ ord volume, still is insufficient to with less
just ahead, Mr. Hainan believes,
than $70,000,000,000 at
surplus stocks came from insti¬ ture, one of the most important meet that
.through a general reduction in pro¬
demand.
the end of 1941. • These assets are
tutions that are definitely not in problems is the
I am not
duction; costs from the wider use
maintaining of the
trying to paint an more widely distributed than ever
the no-profit class.
integrity of our currency.
<of machinery and the introduction
It is over-optimistic picture. As scarce
before, which is another important
vital to us domestically, and it is
<of mass production methods on a
items begin to reappear in vol¬ factor in
our
economic well-be¬
extremely important to us in the ume, there will be less of a rush
rathefr broad scale by the farmers
ing.
:
foreign field.
of the country.
to purchase than appears
today.
The
net
When I took office as
working capital of
Secretary But even with liberal allowance
Perhaps it should be pointed out
American corporations
of the Treasury, I stated that it is for
nearly
here that Administration officials
this factor, I fell that we can
doubled during the war
the responsibility of the govern¬ be
years, and
have erred before in making pre¬
assured of continued prosper¬
was
estimated
at
ment to reduce its expenditures in
$54,000,000,000
dictions about the course of busi¬
ous
business for some years to
at the end of June—a record
high.
every possible way, and to achieve come—if we have
ness trends.
It will be recalled
continued co¬
Iv In the realm of unsatisfied pro¬
a balanced
I would add operation in all
budget.
that a chorus of voices in Wash¬
The first public financing for
fields-T-govern- duction
that it is imperative that we re¬
demand,
the
present
ington predicted a severe slump the century-old James Lees and
ment, management, capital, labor
shortage of housing looms large.
duce our debt burden now, while" and
..in-.; business with attendant un¬
agriculture.
,
'
James Lees Stocks
.
-
Offered by
Morgan
Stanley & Co.
Sons Co. is being undertaken in
employment and distress through¬
country following V-J Day
but it hardly needs to be said
out the
with
the
banking group headed by Morgan
that these dire events have not
Stanley & Co. of 15,-301 of 3.85%
yet come to pass.; Perhaps it is cumulative preferred shares and
only the timing that is in error
203,833 shares of common stock of
but, in any event, the prediction the
company.
The preferred stock
can
hardly be said to be mathe¬ is
priced at $102.50 per share and
matically accurate.- Besides, even accrued
dividends and the com¬
according to Mr. Hanan's own mon
stock at $26 per share.
The
figures, the demand abroad for
preferred is part of a new issue
American farm crops is still very
of I 30,000 shares, of which 14,39£
large although admittedly not as
shares are, being offered to the
great as during the war.
holders of the company's outstand¬
could be added,' too, that
ing 7% cumulative preferred stock
many observers are not exactly
on
a
share-for-share ^exchange
alarmed over the prospect that
basis.
}'
agriculture must now go through
James Lees and a Sons Co;; in¬
a period of transition as
they ex¬
in
Pennsylvania
in
pected fright along that farmers corporated
would have to adjust themselves
1895, succeeded to a business orig¬
to the new conditions imposed by inally
established in
1846
by
James Lees.
a world at peace.
Management and
On the other hand, economists control have remained continu¬
generally recognize the absence ously in the hands of his descen¬
The company is engaged in
of af healthy resiliency in the dants.
agricultural production processes. the manufacture'and sale* of wob!
Size of farm output does not re¬ pile carpets and rugs of Wilton.
spond even over relatively long Velvet and Axminster weaves and
periods of time- in a positive in the manufacture of wool yarns,
fashion to changes in demand. At
including Woolen carpet yarns and
least, such was the American ex¬ worsted knitting yarns. The com¬
perience in the decade and more pany sells carpets, rugs and hand
after the. last great war. It would
knitting yarns} directly
that; in a declining price
market, the American farmer tries
outlets,
carpet
carpet yarns to other
manufacturers
and
its
to
worsted
knitting
seem
maintain
his
income
at
pre¬
viously high levels by increasing
—-not decreasing—his output and
so
contributing, risu it were, to
surplus stores rathieh than taking
of
care
market
actual'needs' of
the
and, in the
helping
to
^process,
depress
the
the
only
market
further.
In such a situation, subsidies/ by
creating a market for agricultural
products where one doesn't exist,
;
can
alleviat* some
genuine
dis¬
tress among farmers but it must
It
we aire, experiencing great
pros¬
offering to¬ perity.
We must approach; this
day (Thursday) by an investment issue with the
same
connection
facturers of knit-wear.
pany's
two
located
principal
manu¬
The com¬
plants
are
veloping
With
depression
being
character but is
handled
locally, he ,says,
particular • region
of
the
country distributes surpluses
within its
boundaries except
of fruits and the like
own
in the
case
which
grow
and in which
make
in
only
case
demands
on
Hainan points out.
one
section
region may
the other, Mr.
one
■
full support and lead¬
ourselves into at least
reconstruction
a
temporary
now
are
and
development
from
functioning, -and
I believe you will agree that a
wretched
he
looked.
He
would conditions and the economic trends
of the 20s.
7
if he didn-'t get sick under such
Present Situation Greatly
treatment.
I do not see how a fair appraisal Improved Over Previous Periods
be
a
of
"America Today"
any
strong minded
feeling that
in
sion
man
indeed
can
justify
"America
Tomorrow"
is
nancial situation of this year 1946,
inevitable.
as
Depression Psychology
We
Of
employment
ever
Out
of
the
new
people have been created
safeguards and supports that have
can
experienced
in peacetime in the history of this
basically strengthened the founda¬
We have the huge ac¬
of
personal savings;
country.
factor.
social consciousness of the Ameri¬
have the highest level
now
compared with 1929, is this sig¬
nificant
tions of
cumulation
I
am
our
economy.
confident that these social
gains made
go a
in recent years will
in preventing any
recession
from, reaching
long
future
way
eloquent testimony to our prog¬
nomic breakdown.
preferred
ress
since the cessation of hostili¬
To cite
company's exchange ties.
offer will reimburse working cap¬
Freight carloadings late in Oc¬
ital in part for expenditures made tober rose to the highest level
and to be made for a new mill at since
October, 1930, when the
under
the
vember
company.'
,
For the first nine months of 1946
James Lees and Sons Co. reported
net sales of $21,647,604 and net
income of
$2,856,287.* For the
year
ended Dec.
31, 1945, net sales were
$22,525,473 and net income $909,771.
Outstanding capitalization of
the company,
giving effect to this
financing, consists of 30,C00 shares
of
new
3.85%
cumulative
ferred stock and 817,500 shares of
common
stock.
has
capacity—a
risen
new
above
91%
postwar high..
.
though the seasonal peak has hot
yet been reached.
Textile
production in Septem¬
equalled the peacetime peak
reached
earlier tnis vear
with
ber
at
165%
average.
More
sumer
of
.
.
and
goods
the
more
are
1935-39
■
durable;
reaching
con¬
the
one
that there is
the last
as
example, T
no
one
eco¬
am sure
here tonight
who would be willing to give up
the safeguards provided for the
savings of our people by the Fed¬
eral
Deposit Insurance legislation.
The
not
peace.
the
discount
those
still to be met
from
war
to
Foremqst ambng them, is
fact
with
/
are
transition
a
that
we
still
are
faced
great number of shortages
in
adequate
supplies
of all
goods at fair prices.
But, as a people,, we have cause
for
gratification • that we : have;}
sure
emerged from the
war
years
with
near
collapse of
our
bank¬
tem.
I
It is under such
a
system*
believe, that the individual has
the greatest
opportunity for
pros¬
perity arid
common service.
>•;*«
certain that if we could
detach ourselves from our imme¬
I: am
diate surroundings, and get an ob¬
jective view of America, we would
see
a
really powerful and mag¬
nificently
prosperous
like of which has
in the world.
Let
country, the
never
been seen
combine all of our ad¬
vantages into a driving force to
insure
us
rich
a
and
prosperous
"America of Tomorrow."
Edw. Kelly With Robinson
u-
(Special
to
The
Financial
Chronicle)
'
CHICAGO, , ILL. — Edward J.
Kelly, formerly with Bache. & Ov
ing system was one of the most has become associated
.with Rob¬
serious developments of the de-.
inson & Qo„ 231 South La Salle
pression of the 30s,
By contrast,
Street, members of the New ^York
our banks
are
today in a "very and
Chicago Stock Exchanges.
sound
position;
We can count
among
our. y$ry. real assets
of the people in
confidences
of
Electric power output in the
first week of this month rose to
the highest level on record, al¬
output
pre¬
would
our
But, fully as important as the renewed faith in the fundamental
vastly improved economic and fi¬ principle of a free enterprise sys¬
a material reces¬
Such proportions
taken
in
.
electric power, and the like, bear
not
I
problems that
materials, and certain produc¬
these" cooperative endeavors we
perfectly well might find shall be in a position to profit tion limitations which, in the face
of excess demands, cause infla¬
himself in a } hospital in short
greatly in both a material and a
order if his friends should start
tionary-trends to persist.
moral sense.
• *
collectively feeling his pulse at
It is
It is not necessary to detail the
still essential that con¬
frequent intervals, running appre¬ causes and manifestations of the sumer,
distributor, and producer
hensive hands over his brow, and depression of the 30s in
alike exercise restraint until the
refuting
telling him again and again how any similarity between
present rising tide of production can as¬
Proceeds from the sale of 15,601
shares of preferred stock and such
is
to fill this de¬
mart
Bridgeport, Pa., and the unprecedented demand for
It also has plants at goods and services. Indices of
Philadelphia and Carlisle, Pa.
material production,
carloadings,
as
take years
lenders together.
out to
atmosphere for
expanding world trade. The mech¬
anisms set up to expedite world
period of hard times.
at
stock
will
the
create a favorable'
Glasgow, Va.
crops,
Each
our
psychology
n
this country, which
might, if
unrestrained, see us literally talk
.
is nationwide in
is
ership, the nations have set
the Glasgow plant and to redeem average
per-car
capacity
was
recognized that if this prac¬
much smaller than it is now.
tice is perpetuated over really any unexchanged shares of 7%
Industrial production has risen
*
long periods of time marginal preferred stock.
to- a peacetime high. The Federal
The 203,833 shares of common
producers are encouraged to re¬
Reserve Board's adjusted index
main in business, thus making a stock are being sold for the ac¬
of
production
for; September
bad situation worse.
*
count
of certain
selling stock¬ stands at
177% of the 1935-39
That the problem visualized by holders.
The offering constitutes
average.
Mr. Hainan is not entirely in the
approximately 25 % of the out¬
Steel ingot production in No¬
future is evident from the cur¬ standing
common
stock of the
such as the Long Island
potatoes. According to Mr. Hainan
the problem is not at all local. It
there
our
factories.
present economic well-being.
We need to guard against the de¬
our
be
rent stocks of certain surplus, farm
addition
,
to retail
to
in
mand,.
This
housing
shortage,
products
moreover, is matched by a large
courage that the greatest ever, a demand which
volume of private funds
we have other
ready to
important problems we have not even begun to meet.
be used in the
of the past.
building program.
He-establishment of world ship¬ We
have provided machinery, such
Aside from its relation to our
ping, with our own Merchant as
Federal Housing Administra¬
fiscal policies, there are other
Marine playing an important role,
tion and the Home Loan Bank
urgent reasons why we should will
provide a vast outlet for our
System, to bring builders and
keep firmly in mind the fact of farms and
its
yarns
And
foreign demand for
banking structure,
1
the
our
A. C. Allyh Adds to Staff
(Special to The
*
.
Financial
Chronicle) y >
CHICAGO, ILL.-r-A. C. Allyn
and Co., Inc.,
100 West Monroe
marked declineJTn farm incomes
Street, have added Oweri Cort and
was one of the major causes of the
William L. Kerbey to their staff.
last depression.
Today, farm in¬
Both were previously in the armed
come is not only at record levels,
services.
but
preventive
measures
have
been provided to check any down¬
ward trend that might develop. ;
With Municipal Sees. Co. ;
Economists
a
a-£5r
e.
Oythat
the
Not only is employment now at
peacetime peak, but through the
provisions of the Social Security
legislation, we have Federallysponsored
State ' unemployment
(Special
to The
Financial Chronicle)
GREENSBORO, N. C —Louis L.
Moorman, Jr., has become asso¬
ciated with Municipal Securities
Co., Guilford Bldg. * *v
2650
THE COMMERCIAL <8r FINANCIAL CHRONICLE
The Mountain Labored
—Result: One Mouse
(Continued from page 2603)
-
surrender
^Thursday, November 21, 1946
credit terms
calling for a payment period in,the'range of saw fit to break dowmcompletely ;
the barriers of price control, in
months, the time buyer must expect to pay $50 or more
a
month (depending on the size of his down payment). extraordinary if not altogether
lumiliating fashion. The OPA' ac- "
Surely this is steep enough for' the average wage earner, ceded to the demands of the em¬
but represents to him a substantially more feasible propo¬ ployers in elevating the prices of
particular commodities until these
sition than an obligation to pay $85 a month.
24
prices
the part
Board and the other
reached
almost
unbeliev-*
of the OPA, CPA, Wage Stabilization
Thus far it has been possible to ignore him and his able
inflationary trends.
Washington agencies; which at long fellows; and to support the new-automobile market, with
Well,, it is not for me to recalt
last have been ordered to drop all but the final traces
the history of the strikes that took
limited output and enormous deferred demands, on the pur¬
of their
place in the early part of 1946,
once-great powers to rule our economy in their chases of people who, in the main,,
possessed capital reserves That" »is
history, but it might be
respective realms.
sufficiently large to lay down the full amount in cash for advisable, under the circum¬
Now the Federal Reserve Board, which participated in their car.
Instalment-purchase volume in the auto field stances, again to refresh the mindsr
this program of operating a controlled economy during the hence is still
of the delegates as to the attitude
very small.
assumed by this organization in
war through its influence over consumer credit as well as
However, it is difficult to believe that this country can the course of those
wage deliber¬
in other directions, moves to
adapt itself to the national absorb 4,000,000 or more new: automobiles a
year unless ations before strikes even took
trend—but it seems that the Board is only a most grudging the
wage earner is considered las the prime prospect.
If place. And ■ I do so to again
follower of the new course of the nation.
pointedly bring to: the attention,
Detroit must- depend on^ustomersy with cash
savings; suf¬ of the American
peqplip; Hhrought
The Board itself said last Friday that it is continuing ficient to
swing the purchase of 4ts>new and higher-priced the medium:£p£. this
convention,!
to restrictcredit termsto a one^hird down payment and
products, it will find up to 80% oi all American families one extremely important and ibr
a maximum
financing period of 15 months on the products eliminated from its - prospect list, /according to the figures controvertible fact. That is this: no- organization affiliated with'the
which "constitute the great dollar bulk of credit subject found in the recent Federal Reserve
'Board: analysis of cur¬
Congress, of Industrial /Organiza-.
to the widest expansion and contraction "
In other, words, rent family unit savings and earned income.
tions in the early part of
1946,
even the Board certifies that it has decontrolled very little.
It may be presumed that the Board has no. intention whilst the nation was
on
.
...
/undergoing
The Discrimination
oi
Against Hard Goods
To be sure,
soft goods purchases and similar items now
may be handled on a credit basis, according to rules pre¬
scribed by1 experienced credit men and ' the needs and
iyishes of the purchasers. With the greatest Christmas buy¬
ing spree in history ahead,, as merchandisers cheerfully pre¬
dict in the soft goods field, we can
expect appeals to "Buy
Before Christmas, Pay in February," as the Christmas spirit
is abetted by relaxed controls.
;/. Spokesmen for the merchandising groups that are freed
of Regulation W restrictions have
approved the move with
respect to their activities and
have said relaxation
some
has gone far
:
enough. Their motives are understandable and
may be received almost sympathetically, since the net result
of the Board's action has been to deliver to them a
larger
share of the; consumer's credit business, while continuing
to limit other sellers who
normally might compete for the
consumer's expenditures on credit.
maintaining restraints
on
credit-so drastic • that the pro¬
the
rigors
of
.
its wage ^ struggles,
precipitated* a= strike. Not' a single \
duction of new cars-and:;
;§ppliai^es;^
up for lack s olita r y.organizatiorifaffiliated
of purchasing power of" credit,... But. the Board iriust act -with this CIO
movement in/ the
very promptly in relaxing all cbhtrpls; or else the Board's earjy/part of .1946, -of its own vo¬
•
,
restrictionsj founded
on
a.;fe
serve
deflate the most powerful market and demand in
our
to lition; precipitated a strike. "I have
but to point to the /'record/ The
his¬
record": Speaks
for itself.'"
'
•'
*.
tory—if not actually to send these vital durable goods .manu¬
s t r y*
facturing industries- spiraling into; g bad slump.
whichEb^/thefyvay, 4s regarded a$ /
Regulation W, like:. aft government activities, requires a barometer for matters affecting
trade/ wages, and so" forth. shall/
a
bureaucracy,
of; government,
be used at this juncture as an expolice power, checking of' hundti^%/jgM
business ample; because/it was- but-of that
accounts, bank records, etc. On the basis of simple Federal industry!s period of. (collective bar^
economy, the reduction
II^cosBof running thO^dsihess' gairting/jif one- should "call it suchw•'
that the •: original /18% / cent per
of government (firmly endorsed by the recent electorate)
hour patterniwas
evblved/and^ap^^
the abolition of Regulation W wodld have. a vfavorable; effect.
plied to most/of;^the major basic;-'
:
.
The
,
industry. lmtrieil)nitedf/§tates/6i>^
Question of Basic Economic Policy
America;"A:'record,/therefore, of
It is surely a- fair
.question ipva
what the Board %c^e bf;the things /that /transpired
trying to do beyond perpetuating ^ its" own powers in .the. in xthb course;;,of those collective
The Board
bargaining deliberations might,be;/
evidently feels that inflationary dangers credit field. It continues its
vigorous struggle against so- of some ' interest, even at this
Still lie in any material relaxation of credit terms on hard
called inflation, via the
goverhmentrpknnedTecphomy route, moment. '
'goods sales. The Board also feels, as Myron R. Bone, editor while the
government;- of which- it is' an; ageripy, already has
'The United Steel Workers of
of "The Industrial. Banker,"
pointed out in these columns abandoned this field to the forces of,
economic ^freqdobsi. America- endeavored earnestly ahdk
as late as
Aug. 29; that it should have a permanent grant With
Wage; controls* gone,t/price^«c6hi^6is;ended, most priori¬ wW /all of/rther;sincerity;at its
of power from Congress to
command, ^to effectuate/ra peaces
regulate the terms and condi¬ ties junked, it
firmly hangsioh? tq:;.a con tro! "which' is', at able
tions of consumer credit.
ppllectiver bargaining agree-This; he castigated as being a
best, the control pyer^a^etkbd^pfpayment only,
ment with the^major/
/while,
companies- •
prime example: of. bureaucratic desire for a thoroughly
jn the steeHhdustry. Our collec- ,;
prices themselves, and -wages—the vtwo fundamental ecoplanned and controlled economy. Mr. Bone also made a nomic
tive b ar g.a i rii h g efforts broke
forcescontrolling the value of money—are allowed down. Conferences ensued with
strong case at that time contradicting the Board's doctrine to find their own level under
free competition.
Mr; BenjamiriFairless and myself/:'
that the volume of consumer credit in
any important degree
This action cannot affirmatively prevent. inflation as iii New-York during the early part
affects thd business
cycle, pointing out that it never ex¬
such, per Mr. Bone's conclusions,.on the-basic .leverage force of Jahuary,1946;' In the course of
ceeded one-third of
those conferences, the; President/
outstanding commercial bank loans or of
consumer credit.: In
merely inching toward a status of of the United Steel Workers '."of;/
one-half the annual volume of
personal and business taxes.
free economy while the entire nation is
boldly and rapidly 'America, recognizing his responsl^
That the Board is still
hanging on to the dangerous moving into that normal arid
necessary situation, required bilities not only to his member¬
grasping for increased and permanent power is evident in for
prosperity in peacetime,; the Board can .only hamper the ship but to his i country^, virtually
the pronouncement on
entreated
the President of the
Friday, when it recommended that free flow of business
operations and the attainment of broad United States Steel Corporation to
"Congress give consideration to the question of whether markets which
mean better
living for the average American effectuate a peaceable working
regulation of consumer credit should be continued on a worker and
♦
is
.
,
s
•
■
.
consumer!
peacetime basis
as a subordinate but
contributory
the maintenance of economic
stability."
Board's Policy on Automobiles
The
~
trols
as
When failure in that stage of the
The
Deflationary
plain fact is that the maintenance of
such articles
on
automobiles creates
a
agreement without resort to stop¬
page.
We failed in that effort.
factor in
credit
CIO
con¬
deflationary
and
Wages
(Continued from page 2609)
this income, to purchase a
$1,50U automobile
under the harsh instalment terms
required by the Board's
credit-managing Regulation W; he
United States. Because the short¬
veterans and others without substantial cash
needs of these
people for
savings. The
adequate transportation are surely
not less important and
pressing 4han those of individuals
who have heavy cash accumulations.
The
man
who is
building, autos
on
the line in Detroit
today, if he is in. "the same position as a majority of his
fellows, cannot buy one of the cars he is
producing. His
weekly wage will average about $53. In the face of all the
demands
on
buy on time only
if he will make a down
payment of approMmateJy $5Q0 ami
find the money for
monthly payments of, $80 to $85 for
the 15 months
over
which he is
can
permitted to finance his
car.
.
ening of the work week, and. the
discontinuance of' overtime pay-*
a
an
month
alternate to putting almost two weeks'
wages
a car
purchase, he must either pay cash or
into
dropout of the
fruits of his
wages,
new car
market,
y
His inability to enjoy the
work may cause him to
and even to strike; so Reserve
own
agitate for higher
policy is really ag¬
gravating the already critical labor situation.
Car prices have risen.
Therefore, even on uncontrolled
answer/ observed that they would
have to secure price increases,
For the period of approximately
ments; r e SuT t e d in substantial fourv to five;' months, beginning
losses in the weekly earnings of with the latter part of 1945 anc
American
Aggravates Labor Situation
As
America
became
for.
asked
with Mr.
During the early period of re¬ power essential to the acceleration
conversion, industry assumed di¬ ofspeedy reconversion and full
rect responsibility for all of the employment.
In the course of our wage con¬
programs incident to the expedi¬
tious reconversion of our manu¬ siderations during the latter part
facturing enterprises from war¬ of 1945 and? the early part of 1946
time
to
peacetime needs. The this corgariizationv . contended th at
American work week was short¬ the profit-making aspects of the
ened
from
something approxi¬ industrial picture were such that
mating 54- or 60 hours to some¬ American industry could absorb
thing less than 40 hours. The the payment of a substantial wage
shortening
of
the
work
week increase without necessarily in¬
eliminated overtime payments.and creasing prices. When ; argument
cast
a
rather
heavy - economic was adduced by representatives of
shadow over the homes of mil¬ CIQV organizations to that, effect
lions of workers throughout the .The employers of labof, in making
situation, because it demonstrably removes from the mar¬
ket (as the Board
apparently wishes) most wage earners,
proceedings
known,
the
President of the United Spates of
conference
a
FairleSs and.
me
at.
the.
White House.
In the
of that
course
conference,
the President of the United States
asked- me^
as
the agent of the
United Steel Workers of America^
if I would delay
the calling of
a
strike in the steel industry for
ope
This
week.
was
to
provide hirri-
with the opportunity •.to look intoy
the matler to see what it was that"
he could do, as the representative4"
of the American people, to bringabout agreement between, the
flicting parties, vWe responded W//
the Rresident's: appeal; - We called
our
strike
assumed
-
conciliator
heard
many,
,
off and. the / President ■
the
all
->
role
and
of
mediator,/
arbitrator.
He:
of the pertinent testis
from both- the- representa-t
tives of the steel industry and of
continuing through to the early the United,Steel Workers of Araer^;
Spring of 1946, this wage struggle ica. In the course of" that weekpeople, this mighty continued—the wage earners con¬ he rendered a decision. He, ' the
organization undertook the direct tending
that
they
needed the President of the United States,
responsibility of formulating the money, they, needed the bread rendered a decision. Speaking for
wage programs designed to fur¬ they
needed^ the :> butter,; they the people, representing all of the
nish enough money to the
a
decisions
wage needed the shelter, they needed people, he rendered
earners
in this nation
of - ours, the
clothing,' they needed - the The Union accepted the decision
first, to provide them with the es¬ medicine. However,, the Office oJ: of the President of the United;
sentials of life, and, secondly, to Price Administration, which was States and the steel industry po¬
Hence,
needs
of
wage
to
earners.
meet
the
economic
the
provide the
necessary
-
purchasing
in
existence
during
those
days,
litely'told
the
government,
Volume. 164
"Number
4544
THE COMMERCIAL &
FINANCIAL CHRONICLE
through the President, that they make'certain
recommendations
were not
going to accept his rec¬ fecting that situation.
ommendation*
A
strike took
that lasted for
/
place—a
to
strike
period of approx¬
Who—who
a
blame
for
that
strike?
I
ask. those. in this hall and the mul¬
titude
of
people,
non-members
of
tions—outside
members
labor
of
this
and
those conditions should be
held.: responsible .foe, >- the steel
strike? The steel
industry; had
definitely
and
very
arrogantly
said to the President of
the United
States/ "We will
~
not accept your
decision."
A strike tbok
place; that lasted
for
period
a
three
Who
of
was
striking against the
at
ernment
that
time?
gov¬
Was
it
the oil
was
.
labor?
Was it the' Steel Workers?
Who was it? ' It was the heart and
core
of
Big
Business
;
strike
a
will
of
the
,
,
■
United
Shall
1944
America, who could believe in the
innermost recesses of his heart,
his conscience, his mind, that the
States.
follow
we
until
now?
What sort of
through from
What is
it
now?
voters
financial status do
a
of
America
the
United
States
of
the
to
Republican
mandate to put a cross on
of Labor, march it to
Capital Hill, and there in public
interest in the protection^ of period of 1939? Is it less than it
gaze witness the actual crucifixion
not only the interests of its own was during the peak period of of
American Labor?
Can
of the people and it
defeated
Government
United
they
occupy now compared to the
peak period during the war? Is
it. less than it was in the
peace
1944?
Party
the
gave
United States.
1
a
any¬
No.
"""That,
It is
fact.
It is
one
nuts
friends, is
my
a
fact.
no
$300,000,000
for
An
a
ated truth.
Holds No Price Increases
record.
uncontrovertible
Since
experiences of. last
and
last
winter,
other
things also have transpired. When
country of
successfully deny, be¬ our
original 18 Vz cents was- ac¬
the record is there,
corded
where experiences
undergone due to strikes. In
that
United
economists, who prepared ah ex¬
haustive study for the considera¬
board—a
tion
board
to
ascertain all of the pertinent facts
involved in the issue which
pre¬
sented
itself at that time
union and the
the
•
,
to
.
a
wage
increase approximating 18Yz cents.
The union accepted. The
industry
refused.
JlJfJ
■
!
both
of
the
President
A protracted s'rike ensued.; And
who was responsible for the con-
$15
a,
billions
;
profit
can
reap
as
.
'
the
f
butter
and
other
necessaries
of life, because, thh, automobile industry, in its arrogance, had
"no"
to
another
said
government
that
profit
picture
1.
i:
.
•
I say
that
for/American
of
n
-
experience
which
organization
: had
speak
now
was
the
another-'CIO
to
undergo. - I
with particular-refer
Y enpe to: an investigating committee of impartial conciliators, medi.
t
,
r
i
was
named to look into the situa-
affecting/ the
United
strike
Electrical Workers
.
walked
out
refused
to
mediation.
union.
/'
on the part of the
President t>f the United Slates of
America
that; these substantial
wage
increases, which later
could
be
were
American labor,
conceded
by
American
industry wi,thout necessarily
fact finders or arbitrators. either agitating or disturbing the
This committee, composed of Ar- inflationary spiral. The President
thur Meyer and William H. Davis, of the United States of America
of
at
the
the
properties of the Westinghouse
"V
Manufacturing Company/ And
; / what happened there? After some
extended hearings before this in¬
vestigating board, the Westing;. house v Manufacturing
Company
v
•
the conviction
to be accorded to
ployees.
of
.
the -meetings.
accept governmental
It struck against the
It
struck against its emIt defied the Government
% of the United States that had
lected
It
a-
fact-finding
board
se¬
to
>
haa happened since
that time? What has happened to
economy? It might be inters
esting to reveal some of theM al¬
revelations
have occurred in the
past five
the
18 Vz
or
course
six months.
cent
wage
>
My
those
of the
ever
pre¬
people of the
States.
mind's
old
through
Certainly,
of
are
be
coopera¬
tion, while the convention is in
session, while I am presiding over
' your destinies as the President of
this Organization in the
of
course
this meeting,
has
completely wiped out. Cer^
tainly, it is true that a steelworkers
wage,
which amounted
$56.32 in March of 1946, is now
$43.28, based on the value of his
earning power. So as a potential
expense
to
and
days
our
the
of
back
goes
when
last
to
went
we
depression, that
one
can
the
American
American
the bust is
i
Morris
Paper Mills /
Stks. Placed
Market
on
An
underwriting group, headed
by Hallgarten & Co., today is of¬
fering 29,192
4%%
shares of
cu¬
mulative preferred stock, $50 par
value,
and
54,486
shares
of
$10
par value common stock of Morris
Paper
Mills,
Chicago.
The
pre¬
ferred stock is priced to the public
at
$50
the
share,
plus accrued
1, 1946, and
shares are priced at
per
dividends
from
common
Oct.
$18 each.
1
.
<
.
■
The shares
presently being of¬
fered are being sold for the account of selling shareholders and
no
proceeds from the sale will
to the
crue
ac¬
'•< r/
company.
•
r'.
Outstanding capitalization of the
company consists of 30,000 shares
of
4%% " cumulative
preferred
stock, $50
shares of
value.
par value,
and 250,000
stock, $10 par
common
There is
funded debt.
no
Morris Paper Mills was organ¬
ized under Illinois laws on Sept. ;
9,,; 1915. / The Lindley /Box
& "
Paper Co./an Indiana corporation,
was
merged
on
latter
into Morris Paper
March 30, 1946, with the
the continuing
its organiza¬
tion, the company has been con¬
tinuously engaged in the operation
of a paper board mill and box fac- /
tory, manufacturing
paperboard
company
corporation.
as
Since
bound
stop
it
people
wage
to
earner,
follow.
No
except
ploiters, the exploiters of
the
ex-
our sys¬
$435,226.
utilized/for;/the
It
is
assertion
thinking is going oh in
the
business—it is the
duty
of the Congress o£ Industrial Or¬
ganizations to direct the attention
of
the
American
dangers
beset
which
us
as
people to the
might very well
result of the promo¬
a
tion of such
foolhardy policies.
I am proud, yes, very proud of
the record that this great organi¬
zation of
and
of
ours
the
has made for itself,
many
Westheimer Co. Adds Scott
;
(Special to
this
because
places throughout the world.
many
.
War
has
passed
hope,
peace, we
and
are to come.
pray
be able to
render toward the
of
they
unions will/
these
will.
/
Co., 326 Walnut Street, members
the New
of
meeting here today, the
day
of
November,
1946,
stronger than ever before—nu¬
merically
stronger, stronger in
heart, stronger in mind. In the
are
of
our
deliberations
we
will
responsi¬
bilities and our obligations to the
people whom we are privileged to
represent and also to our great
and beloved country, the United
undoubtedly
assess
our
States of America.
I thank you
York
Stock Exchanges.
to
and
Cincinnati
Mr. Scott prior
serving in the armed forces
for
many
Dominick
years
&'
associated
Dominick
was
with
in
New
York City.
With Walston Hoffman Co.
-
,v
(Special to -The Financial
LOS"
Chronicle)
ANGELES,.
Frank O. Bruck has become
/
•
CALIF.
—
con¬
nected with Walston, Hoffman &
Goodwin, 550 South Spring Street.
Mr.? Bruck
was
previously
with
Morton SeideL & Co., William JEL
Jones & Co. and Oscar F. Kraft &
Co.
>
.
Thomson & McKinnon
Adds
;.
to
Staff
W
'
(Special to The Financial Chronicle),
WEST PALM
BEACH, FLA
.
—
John F. Gaynor has been added to
the staff of Thomson &
319 Clematis Street*
McKinnon,
'
v
-
^
,
,
at¬
lofty goals. I
I know these
18th
course
*
Chronicle)
Scott is now with Westheimer and
contributions
mighty organization has
made toward the well-being of
America, to all of her people.
The. Financial
CINCINNATI, OHIO—Elmer O.
that this
We
eye
boom and bust period. The boom
is on in the fourth
quarter of
1946, and if there is a continuation
of these staggering profits at the
been
consumer, as a worker, a man ob
kind
know
which*
itself to the
United
that
increase
this
tainment
anything
sented
this
startling
should
than
But what
most
society to things that
this forenoon - session of this con¬
vention? It is a far greater threat
Stated.
so
awe
elements
days of
We
God, through the medium of
threaten our form of government this
convention, that the represen¬
—-and I speak now with
particular tatives of the Powers now meeting
reference to allegations made con¬ in .the
City of New York will ef¬
cerning the Communist Party. But fectuate for the peoples of the
what could constitute a graver universe a
permanent peace., ac¬
threat to the perpetuity of our free cording the utmost degree of se¬
existence in the United States of
curity for all people against the
America, our democratic way of ravages of war in the years ahead.
life in America, than this fiscal And it shall be
the business of
picture that I have taken the priv¬ this
mighty union' to lend -what¬
ilege of presenting to you here in ever constructive
support it may
a tors,
Y tion
.
^It; is asserted that certain in¬
terests here in the United States
threaten / our. institutions
and
the i United
States, this is; a matter of irecord,
all-important fact that
All right., Off that record came
might be pertinent to this particu-
1
/
truth.
employees, employees of
certain
of forcing our wayof
thinking down the. throats of
many people all over this world. I
bor attribute many of the eco¬
nomic ills of the nation to Amer¬
Another
memories,
opening ad-
your
purpose
a
President of the United States by
of
ment
make
a
Government
of
wonder
national
our
research
own
reaction
our
transpiring in
contrast
biased report/emanating ican labor. But in their distortion
organizations at¬ -of the facts, they never attempt
tached to CIO, that was -a gov¬ to present: to the American peo¬
ernment report submitted1 to the ple the simple, pure unadultered
from
the
lar wage issue and which also
will
refresh your
% witness sometimes with
American
of
his
Electrical Workers' Strike
for
our midst.
I of ten
why it is that people in
corporate business, as against that many other lands, following the
of
the
recent election, view with a de¬
and
American wage
converting it into folding
earner
today? The American wage earner, gree of suspicion the" motives of paper boxes of various types.
whose living status is now $11.04 certain people here in the United
Consolidated net profit of the
per
week
less
than it
was
in States of America—why is there company and Lindley for the nine
belief
in
February and March* of 1946.
many
quarters
that months
ended
Sept.
30,
1946,
V. Who is paying this bill? Why our money is being utilized for amounted to
$652,086.
For the
are there so many rumors ema¬ the
purpose * of
changing
the full calendar year
1945, net profit
nating .from so
sources thinking of people in many coun¬ was
many
$309,359.
The consolidated
about the dangerous aspects of tries, in the distribution of relief
balance sheet as of Sept. 30, 1946;
in the lending of money and in
a predicted recession or
depres¬
shows total current assets, includ¬
other ways.
sion sometime during the
It would indeed be
year „of
ing $1,909,581 in cash and U. S.
1947? What could be more danger¬ regrettable and most unfortunate
Government securities, of $3,829,-;
if the lending, gift-giving propen¬
ous to our national
economy, what
735, while total current liabilities
might constitute a greater threat sities of the American •Govern¬ were
.
$15 billion profit
War Mobilization/ and; Reconver¬
industry constitutes
sion, a factual report, which sug¬ a threat to our national economy,
gested as early as September, 1945^ and graver • threat to the main¬
that American. business, by and tenance of our system of
free en¬
not
and
ask
Mills
Peace
of
Will you take time to
can't
people.
American Foreign Relief and,
history of American business.
.
the public had to be discommoded
ary spirals in this country.
;;Y • '
and fhe i
people had ■ to V suffer, / That was not a CIO report. It
strikers had to go ^without bread was
No, they
predicated
profit. «A higher profit than ever
experienced at any time in the
of the
United States; distr i bu t i 6
through the Director of Economic wealth?
Stabilization and by the Office of
mistake.
grave
do that to the American
upon that rate for the last quarter
of 1946. This is an
unprecedented
j tinuation of that strike? Again;a large, could afford to make pos¬ terprise in the United States of
J CIO union had accepted a gov- sible the payment of 24 % in wage America.
ernment
verdict.
The
Industry increases without necessarily dis¬
These
people who propagate
; bad. refused-to accept it. Hence turbing or agitating
any inflation¬ false notions about American la¬
!•
a
interests
.o£, the
early as a year
ago; last August. In that study, to full employment and full pro¬
prepared by White Hpuse econo¬ duction in the. United States than
mists, there was submitted to the this distoited^; wholly inequitable
United States
industry. In
the automobile situation, the fact-? President
finding board found for
.
ouf1 Government's
the Government of
States appointed
a
fact-finding
,
in the early; part of the
ahatedr from
situation
the
us
present year, American labor had
a Presidential
understanding, em~
industry,
were
-
our
the kind of fact that,
spring
in; this
t Intake you now to the
automo¬
bile
Necessary
,
f
here
Can
cause
•
a
\
the last quarter of 1946
for American
corporate
'
basic manufacturing steel indus¬
I point these facts
up for ^the
try. But the steel industry
even¬ purpose of
making one assertion
tually
perfected
an ' agreement
that the public press, which in too
with the United Steel Workers
of
many instances has resorted to
: America only" after the
Office of
the use of diabolical slander and
Price' Administration and the Di¬
misrepresentation, / should Yn:o w
rector of '.Economic
Stabilization take occasion to tell the truth and
*had acceded to their demands and
nothing but. the pure unadulter¬
according them; orlce increases
wage: increase.;
and
back
No. To the
contrary, body believe that? Does the Re¬
members, but the interests of bur
country, and. also the accelera¬ evidence adduced, facts reported, publican
Wage increases amounted to, a
Party believe that? Do
tion of the very necessary recon¬ emanating
from
governmental the leaders of that
figure approximating, $165,000,000
Party believe
version needs of the people of the sources, indicate that profits for
that? If they do, they are making
for all of the employees in the
States.
proximating
$165,000,000
in the course of this
dress
pro¬
striking strikes; occurred in the early,
part
against the Government,
striking of 1946, But I do believe that fFom
againsta decision made : by the
these examples it should become
President of the United States of
evident to any' fair-minded man
America.' The steel industry con¬
or
woman' that the CIO, in the
tinued its strike against this
gov¬
early part of 1946 and the latter
ernment of ours for a
period of part of
1945, displayed the keen¬
three weeks, until it defeated
the
est
the
raise
„
approximately
was
striking?
weeks., Who
to
family under
,
organiza¬
hall, who,
under
ligated
and
protect a tem, "and the exploiters of our
our
American sys¬ people.
tem, his earning status now is
Our convention must necessarily
tracted strike? It is true the. oil
$13.04 less today than it was in
direct its attention to a solution
strike was called before any fact¬ March
of Jjast year.
of
some
of
these 'very
vexing
finding board was appointed. It is,
Rather interesting! Rather
problems as they are presented to
nevertheless, a fact that the Gov¬
startling! But nevertheless true. it in the course of your present
ernment of the United States did
That happens to be the status of deliberations.
•/■ ,r
appoint a fact-finding board that
the American wage earner
today.
found and made
Effect of Republican Victory
recommendations,
and the oil
industry, for all prac¬ Holds Corporate Profits Excessive
There are other aspects of this
tical purposes, refused to
accept
What has happened to the em¬ situation to which I must neces¬
the findings of that board, neces?
ployer in the meantime? What sarily direct your attention before
sitating an extended strike.
s
has happened to the
employer in¬ i;he convention is called to order.
What; happened with reference terests in
the United States in this Some people here in our country
to
the ; packing house
dispute? period to which I
make reference have the peculiar notion that as a
There again, another
fact-finding is very
result of the Republican landslide
interesting.
board was appointed, and there
in the elections of November
In the year
5th,
1939, the year prior
again was evidenced unwilling¬
the
to the war—and that was
Republican Party has been
ness
on
the
accepted
part of the major
given a mandate to do certain
as sort of a
year that should be
packers of this country to accept
things to American labor. Is there
used for the
a
purpose of balancing
decision from a governmental
things during the war: in the year anyone in this convention hall, or
agency.
any
sincere 1 thinking individual
I
could continue enumerating 1939, corporate profits after taxes
anywhere in the United States of
were
$5
billions here
in
the
other
specific situations where
Why
,
imately three weeks.
was
af¬
2651
for your indulgence
With Thomson, McKinnon
"
(Special/to The Financial Chronicle);
ST.
PETERSBURG,
FLA.
Thomson & McKinnon, 340
tral
^
—
Cen¬
Avenue, have added William
R. Howard to their staff.
^
With State Bond &
Mortgage Co.
(Special
to
NEW
The Financial
Chronicle)
ULM, MINN. — Walter
Phillips is with State Bond
Mortgage Co., 2QVz North Minnesota Street.
■CV
/
CHRONICLE
THE COMMERCIAL & FINANCIAL
2652
fairs.
Bread and Liberty
(Continued from page 2607)
Mich,
'mat
historic
The
pruduceu an
meeting
word:
"participation."
promised
Republican
Party
,
full-hearted
participation ..in the
affairs of, the world for the- sake
of world peace and world pros¬
.pf
you.
.who has been abroad
'
If this country happened to. be
ruled by a dictatorship tor a so¬
cialistic oligarchy, then it could terly neglected or stupidly bun¬
stint participate
in world affairs gled. You have wanted to rush
but
its
participation. would be home and raise' hell with some¬
confined to participation by and body—or anybody—to tell Amer¬
ica, for God's sake, to get going.
through the government.
You can
imagine, for example,
But this
perity.
country is dedicated to
And
freedom.
has
"participation"
so
special meaning for Ameri¬
a
It means; in
cans.
participation
by
It
callings.
participation
means
toy, free and independent educa¬
tors and journalists, by free and
scientists : and min¬
isters of the Gospel—and by free
and
independent
businessmen.
And so I urge each and every one
of you to participate actively in
independent
If you are not
business.
overseas
regularly engaged in it, find some
way out to give part of your time to
it. If you are a senior executive of a
firm doing only a small part of its
business abroad, plan to give an
attention
extra amount of
to
the
smaller child.
I
this
knowing
'full well how heavily engaged
you are with problems at home.:
When your invitation came to me
some
weeks ago to speak about
American Foreign Policy I, too,
seemed to be wholly immersed,
journalistically and 'otherwise, in
the American scene. The big story
was the meat shortage. There was
urge
upon
you
^lso;a power strike in Pittsburgh,
a; slumpiri/Wkll/Street
in
?tr;ke
Time
was
and
Life
and
theater season
lions
of
around
Building.
was
the
There
good news—a
some
aisu
new
opening, mil¬
and women
were going ^ to. college with, we
were
told, more than ordinarily
serious purpose and the autumn
landscape of Eastern America
was
once again
the most gorge¬
ously colorful in the world.
It
,
young
men
.
,
.
in the midst of the
was
.familiar to all of
world
the other side of the
on
,
about
scene
so
that I began
us
•But then
the world's greatest ocean,
flying from saffron sunset
crimson
a
over
dawn
over Pearl
Harbor, I could think
only that I must tell you how im¬
it
portant
children
is
and
that
men
for
all
and
you
the
your
children
more
of
Foreign
courageous
vigorous throughout the
length and breadth of the 70,000,more
000
square
miles
and
among
all
of
the
the
one
Pacific
thousand
million people of Asia. *
'
.
A
THily Wise Foreign Pbli#' v
What is the right vantage point
the visualization of a truly
wise American Foreign
Policy? Is
it here in America, in our. own
familiar, fabulous cities and fruit¬
ful countryside?
Or is it out there
there—across the oceans?
The answer,
of course,, is plain
-r^as many of you know from.your,
own
personal
experience.
Both
vantage points
In
this
and
are
room
women
essential',;."
tonighf'are
who
have
/
men
been
in
part
every
before in
of the, world. Never
history have so many of
the people of any nation deployed
so
rapidly
earth
over
the
face
have the people of Amer¬
in the last few years. There
ica
is not
tain
as
a
or
spot
a
earth, not a moun¬
city or an island that is
on
»ot, to some American,
as
of* the
his
own
as
familiar
backyard—nowhere;
that is, outside of Russia.
Every¬
/
-
comprehensible.
may
have
the
You
Persia
in
that
radio
Now any call
or
South America.
Any
of us
one
of urgency
sense
about things
few days when he knows that
is
very wrong
extreme,
what
to
would
asked
of
io
to the other
go
ask
of
Americans
only.reasonably
composed
nation
a
it
be
ex¬
clusively of saints and crusaders.
We
are
also human and
have
we
problems here. And so* putting
together the outside America and
the inside America points of view,
the
moral
is
again
once
plain:
American Foreign Policy is in-r
separable from American domestic
policy:
successful
a
American
problems,
as
in
others,
freedom—which
of
terms
well
as
means
faith in the capacity of free men
to
with energy, With
and good morals.
act
sense,
Russia and United
Now
I
socialist, his
need i$ that
cause of world-wide free enter¬ American capitalism should be
prise .is certainly not to be inter¬ huge success. A serious failure of
preted as an invitation to enter ourv economy /would be almost
hardly a person in this room to¬
night who does not now accept the
thesis that the basic fact: in the
world
today is
tween
Russia
States.
And
the struggle be¬
and
that
United
the
the
tween them is basic.
issue
be¬
For the issue
is Freedom.
Freedom
requires always to be
translated into actual political and
economic forms.
When the cause
of Freedom is
linked, in the prac-?
tical work-a-day business 'of life*
Foreign Policy is impossible un¬
paralleled by successful
with
less it 'is'
biLsinessmari>is; not/merely. ;• an ; in-r
solutions of our problems at home.
cidental character in the
Furthermore*
/our
or
success
failure in both fields Will reflect
fundamental
our
.beliefs.
The
British' may have the genius to .be
free
Freedom
The
intimate
lies, in
-/ swank
capitalists
ai home they Willi be- New Dealers
abroad.
If
theyoare
free-enter¬
prisers
athoms,>$iey will ,|?e freeenterprisers /overseas*
»4
v v ;;
of
cally, a
the contest.
and
But not the Americans*
If the Americans are New Dealers
the
cause
dramati¬
vital actor. and factor in
enterprise
super
then
buts becomes,
belt-tightening., socialists at home
abroad.
enterprise,
to
the
relation
our
fact
of
foreign
that
the
free
policy
kind
of
government which believs in free
enterprise is the/kind of govern¬
ment which trusts the people not
only to«manage a • large part of
their own affairs but to get things
done
their
on
own
initiative. That
v
■"* It is
popular these days to speak
bi-partisan policy/ No one
rejoices more than I do nor con¬
of
our
curs
heartily in the support
which is being given to those two
able
more
and
Secretary
patriotic
Byrnes
Vandenberg, U
America's
recfion.
the
course
on,
and- Senator
They
have
set
in;the right dK
But it is' Of
pilots
Americans?—
little1
use
for
the bridge to set
a
means
you—and me; and
For essentially
American.
and delightful green
fatal to Britain. For- several years,
at, least, the success of all Euro-*
the American
vote
of
people voted
confidence
in
the
business
you
will
more
difficult. In Shanghai a coq-
find
abroad
ple.of weeks ago I got an earful
of the Americans
stood.
trying to do business in
The
who
are
that
wonderfully hectic city and I
them they should at least be
told
thankful they
do
business
York.
not trying to
were
in
I will
Akron
-
New
or
to. you
now say
men
from Akron and New York that if
think you have business trou¬
bles at home,
you
don't know
what trouble is until—as I hope
you willl—you try to do business
in Shanghai. A businessman's lot
you
isn't easy anywhere, but the busi¬
nessman
who goes abroad this
and next is in for aggrava¬
year
tions
and
frustrations
of
a
new
and
special kind. I shall mention
two kinds, both political.
First, you
must
accused of all
to
expect
when
even,
you
be
of wicked¬
manner
and especially
don't deserve it.
ness
us
does his duty to himself, to
companions in labor, and to
his, country—we shall indeed put
on, such., a
demonstration of the
power of freedom as will wholly
change the climate of human af¬
real and
are
in
ties
bringing
But
great difficul¬
together.
them
These difficulties, these frictions
must be reduced. That is, first of
all,
job for trained government
a
in the State Depart¬
ment, the Commerce Department,
and all the agencies dealing with
foreign countries. Two reforms in
personnel
our
government, which have al¬
ready been begun, must be ener¬
getically carried through.
First,
the
quality of
overseas
our
per¬
sonnel must be
improved. A year
and two years
ago,
when the
junior officers of our Army and
Navy began coming back from the
ends of the earth, the point which
I
heard
them
make
often
more
in¬
thousands
calls
you
dollar-imperialists
and expects you to cower in moral
turpitude*
He
■
says
course,
overseas
I
And
more.
think
For there must be
there will be.
100,000" ex-Army and Navy
aren't at least
you
many good men in our
services. There must be
wanted and gives the signal to all
his stooges to say it behind your
officers
back, to your wife, your children,
friends, your pastor. Well,
ica is properly
your
I
tell you the answer to that
can
Don't believe it: it is a lie.
one.
American Businessmen Wanted
Everywhere
Everywhere in the world the
people want the American busi¬
And most
nessman.
ernments
want
of
the
him
to make
noises to
the
•
The
peoples
are
want
the American businessman.
They
want what; he can bring.
they5 like the • way he brings
-
bring it up to about % of
our budget—with, I hopet
Taft's approval.
Senator
American
it*' whichthe way of fair deal¬
ing and liberty. Nevertheless it
not
Should Be '
Idea
*
Promoted
Secondly, the policy attitude of
radically changed
in
New
must
services
overseas
our
Deal
told that the State
of the world
easily confused, but basically they
And
would
was
trary.
to it that Amer¬
represented abroad.
service personnel of
all ranks must be paid well. Our
State Department
appropriation
must be at least doubled—which
gov¬
con¬
GIs
more
many
see
Our foreign
too—even
when? for the sake of their own
particular
demagogueries,
they
have
and
who intend to
1% of
from
days. We are
Department has
itself of its infection
rid
be
what it
of left-
wingism. It is now important that
the policy attitude of our overseas
services should change from a
merely passive acceptance of the |
American idea to positive active
promotion
of
that
idea u every¬
where in the world.
An
example will illustrate what
with us before the
and what must and will be
right with us from here on out.
dom under law.
A few years before the war a
Then there is a second diffi¬
young, enterprising American, who
culty which must be understood had already had experience in
more subtly.
Many countries, es¬ foreign trade, turned up in China.
pecially in Europe, which are op¬ When he had a deal practically.
posed to Communism have never¬ set, he thought he could use a lit—
theless rejected the idea of a re¬ the help from our embassy or*
turn
to free
enterprise.
Or, at getting through or around some
red -tape.
any rate, they think they have.
He/called on an ,em-*
Now
here
we
must: distinguish bassy official, told him his stofyi
between the ■ uncompromisable is¬ And then this official stunned
sues
of human liberty and the him. by • saying: "Young man, T
relativistic questions of economic will certainly not help you, and
system, tylr, Attleie and Mr. Bjevih, I want you to understand that
ithem* believe you are never again to; eorhe- to
that you can have socialism and this office with any such request."
freedom.
I don't.
But I could When that young man got/ out :orr
be wrong—on that one.. I'll be| the street he resolved,; there and
helping to build with the peoples
of many nations a system of free¬
lieve it when I
see
it.
Meanwhile
you and I believe that Mr. Attlee
and Mr. Bevin and their followers
sincerely believe in what we call
the civil liberties and that they
will
never
to take
ness
of
also,
allow
their
socialism
the monstrous wicked¬
on
police state.
a
you
Meanwhile,
and I, believe that the
against
us
in
tyranny
Therefore
form.
we
must
stand
with
them
whatever
shall
in
and
opposi¬
tion to
for
majority of
there
He
each
If the great
fellow-Ameri¬
American businessman.
the
adequacy of American represen¬
tation
abroad.
There
are,
of
his
cans.
of their
people of the earth want
places, indeed in every
place some one will toll you, nast¬
ily, that you are not wanted.
Molotov has already told you that.
tyranny and in defense of
freedom. And what we say of our
attitude/to British socialism)—goes
majority
'
.
than any other was the pitiful
In many
was a
great
socialisms
non-communist
,,
of the troubles
every
what
pean
practical
depends on, American capitalism.
That is a simple paradox which
had better be quite clearly under¬
Attlee-Bevin socialists stand with
.
turn
into any easy
only of ingenuity but of brotherly
enable you to persist in
is
America
see
pastures., On the contrary, if you
find business at home difficult,
love to
there
there is
arrangements,
something else to be said. Whether
or not Mr. Attlee
would like to
urgent
will. take all that you have,
States
that
assume
good
to interest your¬
economic
t
self ask devoted volunteer in the
.
for
-^-over
many
.
our
American
Policy should be
and
in
our
suddenly I .went to the
which ought to be done, or mis¬
other side of the' world—to China
takes which ought to be quickly
and to Japan. And the inevitable
avoided
by
America
and
the
happened—my mind was filled
Americans, now at once. But one
with the urgencies of Asia:
As
has only to be back home for a
the
airplane
Sped
homeward
into
Indeed
unfortunate.
parts of the world, it is quite in¬
shipping strike. trumpeted . the
newsv that
the
deal to us United; States had gone over¬
but, over there, even the whelmingly Communist. Persian
most sluggish American can feel
broadcasters; I suppose thought
that our hopes for a decent world that
any party anywhere in the
are being thrown into;the ash can
world that could beat a New Deal
by our American failure to de¬ party must be Communist.
liver the goods, which hour
by
And many of you have noticed
hour could make the difference
how
in. England,
which
often
between reconstruction and chaos.
seems quite remote as Persia from
We are not only failing to send
American
thinking, there have
the goods. We are, in too many
been bitter and gloomy denuncia¬
cases, failing to send our peopletions of the American people for
enough people and the right p.eohaving voted wrong—which is to
ple.
say "right." I am happy to remind
In Japan, General MacArthur
you that the attitude of the Amer¬
pictured to us the profound trans¬ ican press toward the socialist
formation of the Japanese' na¬
victory in England last year was
tion and as we followed him to a
marked by pledges of continued
high plateau of vision, we could cooperation in a very different
sight the emergence of a nation spirit of toleration and -under¬
which might be really the first to
standing.
turn, forever, spears into plough¬
Now of course both of our ma¬
shares. And when we asked him,
jor parties are devoted to the fun¬
skeptically,
how much
chance
damentals of liberty and in both
there was that this would really
of them majority opinion favors
happen, he said, with deep under¬
free enterprise. But no one will
standing: "It all depends on the
deny that in the context of recent
mothers of American in the next
American history, the position of
five years."
It all depends on
the Democratic Party on free en¬
whether the mothers of America
terprise has been, to put it mildly,
will send their sons and husbands
ambiguous. It was therefore an
or go with them and really do the
event of world-wide significance
job. As usual, the General him¬
when, the American people elected
self, in one of the most dangerous
to preponderant power in the Re¬
spots in a dangerous world, is
public the party which has as the
doing his job with a marvelous,
distinguishing core of its policy, a
though dangerous; economy of
belief in fhe' Tightness and effi¬
means.
cacy of the American free enter¬
I happen to
go this time
to
prise system. Thus our country,
China and Japan. It would have
by far the richest and most pow¬
been the same if I or if anyone of
erful in the world, is, for this cri¬
you
had gone to Germany, or tical
period of world history, com¬
France, or Italy, o'r the. Near East, mitted to the solution of economic
the
Kwajalein
throughout the: world regard
this American decision as highly
It doesn't mean a great
coming back would be filled with
to think, about what I might say.
across
Naturally many leaders of opin¬
ion
read
,
"
course
world affairs,
here
all kinds of
in their various lawful
Americans
hoW I felt
this
only at home but also
.
there.
over
businessman
the
For
means not
if, there is confusion in the
has "seen some enormous oppor¬ galleys and the engine rooms. It
tunity for intelligent American was up to the American people to
action. You recall how proud you decide what principles they would
invoke to bring what kind of or¬
were when you saw an American
bulldozer do its magnificently ef¬ der out of confusion, They; have
ficient job.
decided.
They
have
And you remember recently
how desperate you have felt when elected the principles of liberty
and the form of economy which is
you
saw
some
opportunity for
useful American effort being ut¬ commonly labeled free enterprise.
one
Thursday, November 21, 1940
all socialisms
as
long
as
they
stand stoutly
for the civil liberties
of,.men.
-..'I,
iA
was
wrong
war,
then, to become some day ari
American Ambassador. And, yes/
he
did.
The
man
is Bill Pawley,.
American Ambassador to Brazil.
'Bill has
£
been in Brazil only' a
- months,'
and / in addition to
having entertained 7,000/ Brazil/"
few
iansr.jn his embassy, Bill has gone»
far tp> paving the way for relieve
ing. Brazil's
postwar troubles"
own
through the active participation of.
American/;/free ^enterprise busi-;.
nessmen,/* y
- •:
: ;
\
"'*
.
Bill Pawleys don't grow on
—but
we've
Orv else—we
got
to
trees
them J
as well1
grow
might just
resign from the: leadership of the*
world
and
let
Russia
take
over J
So much for the fundamentals*
happy to reportthat in the midst-of the great dif--
to the matter of iaste Un¬
jfieulties in China today/ ourvCoiK)
Now,
as
Incidentally,; I
am
t-r
\
.i
>»i'
"A
-
Volume 164" Number 4544
Chinese markets.
sul General in Shanghai,
their
Davis,'., is earning
•>■'•*'.'fc^.ry-*v-Jl'*/*f> f■§"%■■'firxJ*p
•i.f
r
•:
/'/'"A !■
xV^Ai' "•>' •?.«.'•
•■'
.
i
■''■ ^
•'•
• ■■■■' -
/'
'
.•*
' ■>.
•
rf"/.
THE COMMERCIAL & FINANCIAL
CHRONICLE
I
Monnett
the respect of
all, both American and Chinese,
by'his* persistent efforts to1 work
<?'v<7 itvJ 4 1 iw *t'.i •:* *•
^.Vi^iVvw?'
men
have
Their
gone
countries to stay.
And right there
name
into
and
those
task
on
itself
as
this
$500,000,-
000,000 task and hope to succeed;
even
capitalism may fail to
Business Outlook foi 1947
and
is
one
funda¬
2653
do it. But the stakes of the effort
1
that's only part of it,
The^ job
is to participate in a world-wide
(Continued from page 2605)
mental of true internationalism: are
not
merely the survival of
ties of an already
confusing situa¬ ment. Beginning in 1933, we.had
"go to stay." The Committee for capitalism; they are much greater,
Economic Development has ad- which is why I ask you to take tion, the President on Oct. 14, an¬ a steady expansion of total de¬
nounced "the end
of nearly 'all
advised
all
posits and currency outside banks
foreign traders to this task so seriously. To raise the
Federal wartime controls on busi¬
until the total reached
adopt this policy. It will be all too level of the world's prosperity
$177 bi'lion
ness.
*He, thus, for all practical in
easy to skim the cream from this is to give ourselves and the world
February of this year,1 since
purposes,
terminated
the
war
sellers' market and come home. another chance. It is to keep the
which
time
it
has
dropped to
economy.
This means that prices around $165 billion as
But if our foreign trade is to do door open to an
a result of
expanding future
will be competitively determined
the
the most good, both in keeping in which the issues and choices
Treasury's debt retirement
us prosperous
will be all new and not even dis¬ by supply and demand; that wages program.
and keeping other
More specifically, de¬
will be. determined by real bar¬ mand
countries friendly to us, it must cernible to us here now. Our
deposits and currency out¬
job
here and now is to open that door. gaining and strikes, and not; by side banks of some $107 billion
be continuous. Go to stay.
government partisanship and bu¬
All of us can
think
of other
certainly seem adequate to any
We require policies for a
period reaucratic edicts.
;
';
conceivable purchasing demands.
projects for exporting American of tremendous
changes. The great
This return of competition to
know-how. A world-wide
chain merit of the
Clearly, there is no problem from
policies of freedom its former
importance as the most the
of
standpoint of banking and
TVA-type
dams,
from
the in general and of free enterprise
powerful factor in business affairs
credit, 00; 0.0.;
Yangtze to the Danube, has been in the economic sphere is that on
has a' vitally important
bearing on
projected, and I can see no reason the one hand they make no denial the
Inventories
have
reached
the
field of credit.
Many business
why it is not America's interest of the eternal and universal prin¬
highest point in history and are
men, after long years of govern¬
and duty to favor these dams and ciples of
being increased currently at the
life, and on the other ment
price-fixing in sellers' mar¬ rate
help build them. Any project hand, as Abraham Lincoln was' so
of $12 billion yearly. \ This
kets, are going to; find, it difficult
which gives American engineers fond of
rate of increase cannot continue.
pointing out, they leave to
adjust' their thinking," their The pipelines of distribution are
and American businessmen oppor¬ the door
open for every new idea pricing, their* cost andexpense
tunity to work with other people and every new scheme which can
controls, and their operations, in already filled in many l nes. This
will work toward our $500,000,- meet the test of fair
signalizes the approaching end of
debate on general, to this
changed' situation. the
000,000-plus world economy. Di¬ basic principles. Thus when an Too
inventory boom.
When the
many business men have got¬
rect investments, which have been American
pipelines become filled and inven¬
speaks of. free enter¬ ten the idea in recent
years that
the stabler and more profitable prise he does not
speak of any costs * directly determine price. tory replacement demand falls off,
part of our capital exports in the grimly fixed scheme. He
speaks They erroneously think that prices competition begins to operate at
the
past, are another, example. Some of something which is * always have to
producer
level
and
prices
stay up because costs have
businessmen appear to have been
soften or break until they find and
changing, of
something
which gone up.
In a competitive econ¬
buffaloed by the old "dollar di¬ leaves
stabilize at a level based on the
plenty of room for social omy that, of course, does hot nec¬
new conditions.
There is no es¬
plomacy" cry on this score, and adjustments, and of something
essarily, follow.
have already missed some rather which can link
together,, fruit¬
Demand determines your price caping such a development under
conditions of Competition,
obvious opportunities as a result. fully, many
differing cultures and and youc supply,
Normally, the
I repeat there is no basi$ what¬ modes of life.
In July, a foreign observer in
price
so
determined
allows
a
ever for being afraid of the MolNew
margin over all costs. This mar¬ the "Eastern Economist,"
;• A policy for this period of tre¬
otov yowls. Direct investments in¬
mendous changes in the humeri gin we call profit. But, at certain Delhi, India, expressed the opin¬
crease the productivity of the na¬
ion that our prqductive caipacity
situation must erivisiori great feats stages of the business cycle this
tion where they are made, and it
of creativity. During • this transi¬ margin, in the case of most enter¬ is so great that our only solution
is only by increasing other peo¬ tional
will be to continue as the world'speriod, a new Europe must prises, turns into a deficit, known
Santa Claus.
ple's productivity that we can bal¬ arise.
While I do not agree
as loss.
And, gentlemen, to para¬
During
this
period, the
ance our trade and permanently
with this solution, his statement
whole of Asia must learn to read phrase the old song, demand "is
enrich the world. As Mr. Knox
of our problem is so pointed that
and
write.
During this period the' cause of1 it all!" - The current
I quote his view as followsr
says, "you can't do business with a
many
new
or
hitherto
remote emphasis on costs and disregard
poorhouse." Yet in comparison centers of civilization will be of long-term market implications
"The
productive 'power
of
with America, poorhouse is a very
in setting prices worries me, It is America has multiplied itself so
woven more closely into the web
kind term for the economic con¬
of
world-culture
Australia, causing many business men, in my fast that it is now admitted that
dition of most of the world today.•
South Africa, The Argentine, The opinion, to price themselves out she cannot continue to give 60,A little while ago I mentioned
Philippines to mention bub a few. of the market.; In too many lines, 000,006 jobs unless she is able to
two of the obstacles which Amer¬
During this period^ atomic energy prices are outrunning long-term have a large export trade.
But,
ican business faces as it sets forth will be harnessed
True, the cream of the in the long run—not so long as
to the arts of demand;
on this new crusade. One of them
pent-up demand will pay the even a * decade—-exports cannot
peace. During this period cities
is nationalism, which will make will be
redesigned, new architec¬ prices asked, but the long-term continue unless imports aref al¬
you feel unwelcome; the other is tures will emerge and there will effect will be a reduction in vol¬ lowed to flow in. v But IJi'S. eco-
capital? expansion
socialism; whidti will make
ume.
feel
ter.
"things.;
•:
•>*
;
0;
\
'.f
•
:y;v
'•/•■'J
■(•
."*♦•':
'"'JfeM
Means of Building $500 'Billion
c-
Economy
■*
I 1 There is much that our governla ment can and must do to make it
possible for
the
busi¬
American
nessman to make contact with an
outside
world
that
needs
and
wants him and to start building the
$500 billion world
But busi¬
themselves must actually
nessmen
do
which
economy
need and want too.'
we
of the job. That is why
important that the policies
government lays down must
most
it is
the
be
so
parallel with
'and of
a
aims,
own
your
kind within which you
-cannot- act.
'*
I shall not now try to give an
•economist's prescription for world
'trade. The prescription set forth
'by Under Secretary Will Clayton
is a good one, and it is to be hoped
'that every enlightened business¬
will support his efforts to
the
international
trade
man
^create
charter
now'
being
prepared
in
London; and also " the new recip¬
rocal tariff cuts
on
which
hear¬
ings are soon to begin. Every one
'Will
favor
this
program who
.'places' the interest of his nation
whole above that of any par¬
•as a
ticular industry.
■
,
But mere tariff
cuts, especially
Reciprocal cuts, are not a very
^searching answer to the economic
problems ahead of us, nor will
they create a $500 billion economy
by themselves. We need creative
■■
ideas. The real job is no longer
merely the 19th Century Trader
Horn job of trading beads for
tyory. tusks.
The real job is to
stimulate the creation of wealth
abroad; and to build up foreign
Countries to the point where we
can trade freely with them at far
higher levels of economic activ¬
ity. The job is not just to jump
aboard
an
export-import
boom;
■
.
v
#
,
.
—
,
you be new flowerings of artistic ex¬
though sopho¬ pression. During this period the
mores
were
running the world. philosophy of knowledge itself
The program I have outlined can will be rewritten; there will be
undermine both these obstacles. a lively interpenetration of cul¬
world. '•
Petty nationalism in undeveloped tures and, finally, if we are to
The
kind of
participation I
countries or in> countries*'which reactr
ahappier: future we iriust
mean is new, but it already has its
have retrogressed, stems from the expect a fresh vision of the eter¬
American models.
I refer you to
lack of the veryt industry and nal purpose of human life.
Westinghouse International. When
President William Knox-of West- capital we offer to bring • them.
Need Bread and Liberty
Socialism,
which
is
the
first
inghouse International surveyed
cousin to nationalism, will seem
In the wondrous patterns of life,
the coming export boom* he gave
increasingly sophomoric fpr the some strands persist. Some needs
it about three to five years.
So
same and one other reason. The
are
perennial. One of these is
he decided to start selling some¬
other reason is that if American bread and another is liberty. Both
thing for- which the demand would businessmen
of these needs are both absolute
go abroad as build¬
will
link
of a sort that
industries,
fi¬
nances and our markets directly
with every other country in the
our
our
impatient,
as
And that is
iiot slack off
so
soon
which
and
would generate its own
means
of
The product he*is ex¬
porting, moreover, is one already
payment,
favorably known
» throughout the
requiring, L<am sorry to
say,.- no rvery costly advertising
campaign to introduce it. But it
world,
is
product which 'will generate
more advertising and more busi¬
ness of all kinds between Arner-^
a
ica
and
other
nations
than
any¬
thing else Westinghouse makes.
The product is know-how,;
'
Westinghouse has already riegdtiated
deals,
China
those
to
with
;
Mexico
and
help build factories' in
countries.
As
part
of
the
deal,
300
Westinghouse is bringing
Chinese and 200 Mexicans to
East Pittsburgh to teach them how
to
run
those factories; 15Q are
.
there
already. t It
Westinghouse
sounds
were
vas
if
deliberately
dealing itself out of the Chinese
and Mexican markets for electric
waffle-irons
and1 25-watt
bulbs.
Possibly, but Mr. Knox doubts
And
certainly he
himself out of his
is
it.
not
more
dealing
important
market for water-wheel generat¬
ors,
transmission
other
tions.
.
equipment and
high-technology . installa¬
Nor is it his plan just to
start these factories
running and
never look at them again.
West¬
inghouse is obviously at the start
of a long and mutually
profitable
association with the Mexican and
ers, as Wealth-makefs, as creators
of productivity—in short, as good
and relative. There is
need
for
bread
and
an
absolute
absolute
an
be
good need for liberty; But the needs are
salesmen for their system as well also- relative to the potentialities.
as for their country.
Today, the simple loaf of bread
The British tell a story about or modest rice-bowl is not enough,
capitalists—they
will
G.I. who told; a friend he was for the news has gone out throughgoing to leave God's country and Out; the world that man can pro*?
return to Britain, where he had duce cornucopias of plenty. And
spent the war. "Why?" asked the today and tomorrow that liberty
friend, "It's chaotic here, but it's is' not enough which is confined
chaotic over there too," "I know," within the limits of old laws and
a
a
serious mat¬
Effect of Return to Competition
The
return
which
we
force. many
practices.
of competition
witnessing will
changes in business
are
Just
to
give
you
of
prosperity; and
we
begin call¬ idea of mobility—the
a
slight idea Of - what this means
from the standpoint of production
alone, consider the productive■ facilities of the country.
According
to the National Industrial Confer¬
ence
Board, in 1939
we
had $39,-
532,000,000 of productive facilities;
We. added, during the. period
July,
1940,,. to June, 1944, a further
$23,505,000,000 of productive fa¬
cilities j and/;we haveridded- Sev¬
eral
billions more since
June,
19,44. Thus, despite current indi¬
cations and thinking to the con¬
trary, we undoubtedly have, on
any
realistic basis, great over¬
capacity in nearly all lines, of
business activity.
Excess produc¬
tive capacity and wide-open com¬
petition will create serious prob¬
lems/arid cayse, many, headaches,
thii it will be immediately bene¬
,
said the G.I., "but over there they customs^ :for1 the liberty * pdsSibte
got the chaos organized." I suspect today is a vast liberty of mind ficial to consumers
and, in
that when our own chaos begins and movement. Inherent in the
long runi to business itself.
to take on the familiar lineaments meaning of the word liberty is the
The
the
return of competitive prac¬
ability to
tices and competitive; prices,
the free movement of men, under these
circumstances of un¬
of their products and -of their
paralleled : and enormous produc¬
charms.
thoughts. Wherefore, the rule; of tive
capacity,>must be used as the
'Our diplomats will tell you, and liberty is not the easiest to estab¬ basis of any forecast for 1947.
lish among men, but on the con¬
they are -right; that
America
.Quantitative j arid Qualitative *
should not try to impose an: eco¬ trary, the most difficult. It is now
America's chance to show that it
-00 V■
Factors*
nomic system on any other coun¬
can ; be
done^better than ever
;
try. But it is surely the best di¬
ing it freedonti once more organ¬
ized chaos will lose Some of its
nornic
organization is such that
possibilities of her being paid
imports are not very bright.
But imports will or at leagt might
create unemployment.
In such
the
in
.
..
/
J*»
move;
■
,r
circumstances
such
plomacy to be honest about what
we are, and not to pass ourselves
off
as
ness
socialists when
in
a
socialist
we
do busi¬
country.
The
struggle for freedom will not be
won
by refusing to make con¬
our cause as we go. It is
verts to
true
that
final
economic
systems
are
Furthermore, :ih any-estimate
...
Bread' and
liberty,
-
,
-
of
the future, we tfiust evaluate and
two project quantitative and qualita¬
is law¬ tive factors. ; In view of the in¬
,,
these
and-as much of them as
it
would
foolish
be
not
thing
as. some
unemployment."
Another
,.
quantitative
.
factor
the cost of the labor warfare
have been having.
is
we
By and large,
the wage increases have not com¬
pensated labor for the time lost in
securing the increases.
Costs of
goods have been forced up, but
which
labor
has
has
struck
not
recouped its. decreased payrolls
for the time lost front the job.
This creates
in
a
further
imbalance
already distorted wage-price
relationship.
If savings are not
an
used to bridge the gao. sales must
fall off;
Strikes reduce:
accumu¬
lated savings, both individual and
corporate.
And, gentlemen,"the
outlook is for even more serious
labor trouble than
the past.
With
mine
|
have had in
we
;
t
John
L.
and
Lewis
his
workers
fighting the gov¬
ernment,
with- the f automobile,
steel, oil, rubber and packing
house
workers
demanding
in¬
creases estimated as high as $2.80
a day, the outlook is dark indeed.
Anothet .quantitative
factor
is
the number of competitors in each
field.
vious
Not only do we have pre¬
producers expanding into
totally different lines, but we now
countless
new
war-bom
possible, are essentials of tangible character of many of the have
In retailing, in par¬
any .f human
destiny. > It ■* is for .qualitative factors, may I urge producers.
America largely to provide them you to draw your own conclusions ticular, we have doubled the out¬
fully
<
now
and
show how they
By doing our job,
keep the doors open
to
provided.
are
from the facts and observations I
we
present rather than merely accept
my conclusions. ■ Please form your
absolutes; but this ap¬ shall
for
plies to other systems as well as the future and many of us Will own judgment in your own field
our own. Our system faces a great
live to see the beginning of an¬ as I necessarily must talk in gen¬
'
'
challenge, the greatest in its his¬ other joyous springtime of the eral terms.
tory. It is the only system,, to my spirit, a recreation of man's home .On ibc quantitative side,* we
have plenty of the means of pay-.
mind,r" that could impose such a on earth. ' %vV--ZL.'c'"' !Vi
not
»
might
irnagine
to
give
away
goods to other countries, for on
balarice it would be better to part
with surplus goods than to create
•
.
before..
a
-
lets
is
it
one
-
some
appliance
homes
435
average
every
For example,
that there is
electrical
i an
for;
fields.
estimated
each
for
to
in
'of
compared
one
wired
1,000
now
dealer
dealer
homes
t.
•
before
fi the
'.01 '(Continued
war.
on
" From
page
2654)
an-
<t-V
THE COMMERCIAL & FINANCIAL CHRONICLE
2654
Thursday,' November 21, 1946
earnings, should devote their had to be in the market, and a loss. So I put in the stop. past week
Boeing broke its
the ■ ideal riiethbcf but
reading to the comic books. the market behaved H i k e It
stop.
,
'
there was something; brew¬ until a beter one
A
statistician
delivering
comes
Readers still long of Ana¬
along
forecast oh things to come ing, it would be a good idea to IT stick to it.
conda at 37 and Standard Oil
bases his opinion on certain use stops.
*
Actually I prefer
of Kv J. ab67 should sell them
t
•
Tomorrow's
f
/
Markets
n
known
Walter
factors.
safely
knows
Says—
In
assumed
there
'
these
if
factors
lots
are
be mental rather than actual
can
that
or¬
I also know, however,
that that few people have the time
he
of other peo¬
ders.
the patience to sit at a tick¬
or
==By WALTER WHYTE=
ple who know them too. So er tape all day, day in and
much for that. The disparity day out, week in §nd week
Market still in status quo.
And even if they do, it
in statistical opinion arises out.
Longer it stays dull the more
when the interpretation of still takes positive action to
extensive
subsequent move the factors is made.
/• Many give an order to sell.
Few
will be. Continuation of stops
statisticians assume that be¬ pepole are mentally consti¬
advised.
tuted to act rapidly, particu¬
cause certain conditions were
If anything of market im¬
present in the past that the larly when it comes to taking
portance or significance hap same conditions will be pres¬
pened in the past few days, ent in the future. Ergo! Earn¬
it has escaped me.
The fact ings will be higher, or lower,
that the market
dead
is almost
indicates
center
at
nothing has happened, though
it doesn't indicate, that noth¬
■■■%& /■*>/
'
refuses
to
Commit itself until it knows
He
*
what to
only
the
which
sum
very
Government
cepted by getting
tion.
of
occurrence
But
ac¬
people buy or sell, and then
injunc¬ moves accordingly.
an
while/ this
may-
0*
*
❖
cance,
will be
ance
think.
as
First
•
great as some
of
all
the
fact
that Lewis: would act up
ures! ;
But while
It
is
apparent that in the
past few weeks the market
hasn't
fit to
seen
reflect.any¬
is body's beliefs or philosophies
for more than a day or so. It
court order
a
'
K<,
The Backlog
nothing new.; The only new
has done little but hem and
thing about it is the injunc¬
tion.
heavy. $ In fact, probably
the greatest backlog ip the coun¬
try today is the backlog of fail¬
have eventual market
signifi¬
I doubt if its import¬
Here and there
haw.
market break out
on
a
the
the up¬
a
stock
'
:
of Demand
Probably this is
as
good
place
a
Right how
Industries
heavy
a:
at
17, stop at 15;
Ohio at 12,
stop
10, and y International
Paper at 43, stop 38. In the
Gulf, Mobile and
customers for cars at
there are at $700.
$1,500 each
as
•The outlook for the railroads is
not bright.
For example, Vice-
President
Franklin
of
the
Penn¬
sylvania Railroad testified in Sep¬
tember in support of a rate in¬
crease sapplicationy that his lino
faced a deficit of $14,616,000—its
first in 100 years of operation.
President Metzman of the
York- Central at the same
satisfied that his road would
deficit
a
1947
if
of
freight
New
time
sus¬
rates
that
not
were
if
great myth of the postwar
they
raised the 25% requested,
they would lose $18,652,000! Even
after making allowance for the
To be sure, we need many
pessimistic
force Lewis, or any
even
figures
presented
at
,
.
'
<
H. Hentz & Co.
;
y
York
New
York
New
Curb
Cotton
Commodity
'
Chicago
•
New
up
I think I know what
Fin talking about.
years,
Exchange
Exchange,
Board'
Orleans
•
Exchange
Inc.
: Trade
of
Cotton
Exchange f'''-
An& other'Exchanj/et
N* Y. Cotton Exchange
torig
I learned that if I
ago
BIdg.
CHICAGO
PITTSBURGH
DETROIT
GENEVA, SWITZERLAND
.
/'/
pract;
tically all lines of durable goods,
production in the not distant fu¬
ture. In short, I do not foresee
any consequential backlogs for in¬
dustry's Christmas in 1947, unless
durable' goods pricesf come; down,
It may be a good idea to take a
quick look at two or three of our
more important industries.
His¬
torically, this country in normal
times
has never enjoyed
good
NEW YORK 4, N. Y.
,////
in
Pacific Coast
.
business
when
the
construction
industry
Securities
was not active.
Yet, be¬
of low productivity, mate¬
shortages and other difficul¬
cause
rial
ties, the 1947 outlook for construc¬
Orders Executed
LAMBORN & CO.
%
tH'fr'l V, ,*J.
•
••
h; • *' '• \f. ■{','< t
///••'
%
New
SUGAR
New
Exports—Imports—Futures
York
Members
York Stock Exchange''
Curb
Exchange (Associate)
Chicago Board of Trade
i,14 Wall Street
New York 5, N. Y.
COrtlandt 7-4150
■
'
-
H
\
'
r
,
.
•
DIgby 4-2727
Y
^
4
Private
San
'
as
the prices of
ter/
Schwabacher & Co.
y,r
*
not4 good
is
private housing have gone out of
the reach of those who need shel¬
5, N. Y.
'iV-.• v!'v'• ^
'■»
tion
Exchanges
Pacific Coast
99 WALL STREET
NEW YORK
on
Wires to Principal Offices
Francisco
Monterey
Teletype NY 1-928
—
—
Santa
Oakland
Fresno
—
Barbara
From
Sacramento
different
stand¬
time
not need as much as
over
prices
1947.
are
cast
a
Also,-
dark
I
shadow
think, that
too high in this-field.
they thought
There
up.
be
may
but it is a
no sense to
folk-way that
this,
we must
take into consideration.
Another
qualitative
factor,
is
that
people buy on the basis of
expectations and not on the basis
of the present.
If they think the
outlook is good, they buy; If not,
they wait.
C
•
Likewise, since the beginning of
the
war we
have had
a
great deal
forehanded buying.
of
As a re-*
consumers' inventories are
; larger- than
is* gene?rally
realized;
in
fact,
undoubtedly
much larger than normally.
The
suit,
much
return
of
buyers'
people
cause
to
markets
will
what
they
have stored, which will reduce demand.
V I'
use
Another
and
most
important
qualitative fgqtor, a$ witness what
happened in meat, is
the
public
conviction that prices are too high.
Whether this is warranted or not
is' beside the
point.-
result will
run
mand falls off
On
r the-
The short-
be the same—de¬
and prices drop;
t
basis of, ^the! factors X
have mentioned
and many others
I do not have time to, discuss^ let
me
I
that
say
believe
we stand
If the present
at 4he crossroads.
strikes,
particularly in
industries^
the risk
a
the basic
are
"solved" with; $2,
and hiore, daily increase and pro-*
ductivity is not increased, we run
of
wage-price spiral in
the inevitable boom-and-bust patr
tern.
On the other hand, if we
can hold
the price line, if labor is
willing to increase productivity,
especially, in return for any fur¬
ther wage increases,, we ought to
be able to maintain a good .volume
of
business activity for a long
sharply, in many, hotels, particu¬ time to come; with
slowly, declin¬
larly, the smaller; ones,
It was
ing prices. Please note' that with
pennted out that ^whereas Tin either
development, I expect lower
prewar years,
66% rooni oqcur
prices, r The only question is when
pancy in hotels meant a profit,
and how much?
' r v' *»
nowadays costs were so much
higher that 92% occupancy Is
necessary if hotels are not to go
into the red.' These figures speak
for themselves!
Without going1
any further, it
seiems clear that many lines, in¬
cluding textiles, foods, and most
other soft goods,; have passed *. or
will soon pass their, peak. ;
There
already
sales
de¬
creases A in
many > lines ' at' other
than retail levels, which means
that from now on the problem of
are
cancellations may develop Into a
one for credit men.
This
serious
risk
can
izes.
added the
which
1947
they did. In any event, demand
falls off the instant supply catches
must
not
be
underestimated
,
nothing
you
do about it when it material¬
■•TTTTV''Qualitative Factors
There are many, many quali¬
tative factors in the present busi¬
ness
situation.
One
is the value
created by shortages,,
;
.
Now,
to" be specific, it is my
gUess- ^thatr biiSmesti^ ^ctivity-^will'
continue(at
a
high rate for
a
while
and then
begin to taper off there¬
after.:
It is also my guess that
prices will begin to drop some¬
time after Christmas in most lines,
with the exception rof; the. durable
goods line, which will still be in <
short supply.
And,
even
in these
durable goods lines, the prices of
nearly
all should begin to drop:
:Juije,':''
/ ; rJ:
{
while- higher:
And
costs/wilt,
probably cause prices to eventu¬
ally stabilize at a higher' level,»
say
the
those
are
moment it becomes freely avail¬
able, people seem to lose interests.
They discover that they can post¬
pone their purchase or that they do
near
ers,
with
They
commodity is in short supply,
it seems everybody wants it. The
real risk and there is
current wage demands
United Automobile Work¬
coincide
a
ord
compared to most other in¬
dustries is indeed not a good one.
their 1946 troubles must be
Whyte
expressed ■ in this
necessarily at any
not
of the
presented as
those of the author only: J /
just because there have been no
cancellations for years.
It is a
To
views
do
Chronicle.
points (not, of course, invested
capital) the automobile industry
hardly got through 1946. Its rec¬
of
^
many
•[The
article
$69,000,000 in
were
Thursday.
—Walter
■
Outlook fo*
—but at a price!
such hearings, these
figures are
other goes into independent action n9t exist in a vacuum; other fac- still on the bearish side.
but seldom does this.: action
torsventefdntd the situation; Some
labor leader;; to continue barhave any effect on other of these manufacturers may be < Or, take the airlines—with ter¬
rific capital costs facing them,
ga ini n g, it cannot force
stocks or the market.
kidding themselves about a three with
miners
to
$10,000-a-year pilots going
produce coal.
to nine-year backlog of pent-up
on picket
#
$
*
lines, with press releases
Should the strike, or the "un¬
demand for their products; but
saying that "by 1947 the passenger
There is this to be said, they are not kidding anybody else!
willingness" to work without
carrying capacity of the nation's
If they do hot produce enough to
a contract last foif any time,
airlines will equal, that of rail¬
however, of a market which
take care of their customers in the
roads in 1941," with vacant seats
it can have severe repercus¬ spends
time marking time. near future, then their competi¬
becoming a problem, with termi¬
sions on many industries.
To Such a market, when it tors will. Make no mistake, about nal and
many! other facilities
'
-" •, |
that extent, the optimistic breaks out of its channel usu¬ that, i
\
Mip
completely inadequate, and with
So, while admittedly, demand
forecasts
of
1947
passengers returning ta the rail¬
earnings ally moves rapidly and in a
will have to be revised. - y sustained fashion.
The trick high, production,-in general, is roads, the outlook is not a happy
higher.
With two or three con¬ one.
' /;//,/
0 ///:://...
is to determine the direction
spicuous exceptions, such as autoTo add to the airlines troubles,
of the breakout.
mobiles and
construction^the cur«-; the railroads are beginning to
That too, however, is not
rent rate of production is at a
jjC
*
#
*
fight back, stressing the dependa¬
new. Anybody who believes
higher level than the prewar rate
bility of their own form of trans¬
all they read about future
Sometimes the market tech¬
and it is still increasing in many
portation.
The
caustic
slogan
Now here is the thing to
nician can tell which way the lines.
quoted by "Life" Magazine,- "II
watch;
when
production
gets
market will go. But in prac¬
you have time to sparer go by
caught up in one line, raw mate¬
air" reflects the'experience of too
tically every case this is sheer rials and manpower can be
Established 1856
many air travelers.
luck. I realize that in saying shifted to the short lines, accel¬
The president of .the American
this I'm sticking my chin out, erating production and shortening
Hotel A s s o c i a t i o n
on
Nov.
the catch-up period. That is why
15
way out, for somebody to it is
stated, that the hotel busi¬
my opinion that with the
f
Members
take a poke at.
Having been exception of building construc¬ ness has passed .its po stw a r
3 yyNew Vork Stock ; Exchange '
peak. B tts i ness has fallen .off
in the market for almost 20 tion, we will be caught
can
More next
loss.
yoii hold Dresser
raised—and
period.
things
Demand does
Jersey at
where to get out on
as
.
will prevent too
supposed to have in
many fields. It
is my opinion that we will look
back
on
this "backlog" as the
Sp far
a position the up-side, my suggestion is
profit. If it breaks out on to wait and see what de¬
the down-side,
your
stops velops.
tain
any
following levels." Ana¬
to
to talk about the "huge"
backlog of demand which we are
as
at "the
conda. at ,33 and
side'ybu/will
.
the
was
Should
When "all three" of the
cheaper
other angle, veterans have been cars
are
delivering at a price
encouraged through easy; govern¬ around $1,500, as compared with
ment credit and guaranties to em* $700
plus before: the "war,v it
bark upon enterprises for which would seem that prices are
high.
they do not have the training, Certainly there are not as many
expect. It takes the
experience, or ability.
As these
knowledge of every sta¬ marginal competitors get into
challenge John tistician, who translates such difficulty and start dumping their
L. Lewis threw at the Gov
knowledge into actual buying inventories, price weakness will
pull down many others. Beyond
ernment in the matter of the
or selling,
weighs it against doubt, the business mortality will
soft coal mines; a challenge
whatever other factors make be
The
note
have
you
stocks.
(Continued from page 2653)
*
sensitive
example,
of
Business
case.
*
The market being a little
more
ing will happen.
sje
whichever is the
;
|that
For
list
.20
level,
30%
to
above .the
the-price/outlook
future
unless
is
for
a
labor upsets the
completely.,
So, any
level
applecart
V
^
way you
1926;
in .the
lower
look.at it, the
future, particularly 1947; calls for"
extreme
Sorippg as •predit
caution
men,
on
the
everywhere.
■
part
of.
Volume 164
Number. 4544
THE COMMERCIAL & FINANCIAL CHRONICLE
265 S
Securities
•
v
;
'• i
Now
in
Registration
INDICATES ADDITIONS SINCE PREVIOUS ISSUE
i'-h -.{/•.1
•-
v
-
'"''k-
*•
,
\*x
vf *■
v
•/«.
1i'-l
-•
mated at
Acme; Electric Corp., Cuba, N. Y.
$1,179,000 will be used tQ pay a mortgage on
plant, pay accounts payable, purchase equipment, for
jbuUdipg alterations .and working capital.
~
;to underwriters. The 300,000 shares of
second preference
132,740 shares ($1 par) common stock.
stock will be offered
publicly.
The 1,355,240 shares of
Underwriters-—Herrick, Waddell & Co., Inc., and First
common
will be offered for subscription to common
V
' V<
11 '
»,r/|
?!
;
.$'• v;! -,1' J
,■■}
ii i V
£
:Y$$l S
Colony Corp, 'Offering—Tobeof fere d publicly at $5
stockholders of the
company in the ratio of one-third
American Colortypo Ca;,1 Clifton, N. J. :
a share,
proceeds—Company will receive proceeds from
n.ev^. s^are f°r each common share held.
Unsub*
the! sale of 68,880 shares and four selling stockholders^*] Aug.: 12/filed 30,000 shares
($100 par) cumulative pre- - scribed shares of common will be
purchased by the
th^proceeds^roih
M of ;63,860 shares; Company v^ferred stock, pUnderwriter^White; Weld
M
Utf
offering prices by amend'k'
D«amaaJm
also will receive proceeds from the sale of
by-amendment.
Proceeds—Net proceeds initially will !; .went. Proceeds—Net
20,000 war¬
,
filed
_
H
,
.
.
Jl.*
„-i.
II.
1
-
-'..it ;L.
G
,-rtA
'
y'i
a
TVT-.1
*
,
—^
_
!»
J
x
!i_*
_
^ll.
*
it1'
VvN
XT.l
_
stock to underwriters at
be added to general
aggregate
price of $200.
Of the net proceeds ($292,940) $50,000
'will be used to pay current bank
loans; about $20,000
•will be used for machinery and
equipment, and the re¬
mainder for
an
funds, however, the
company antici-
•
working capital.
building and expansion
Offering date indefinite.
Aug.
29
stock
Mfg.
Corp*, Trenton,
filed',50,000 shares
5%
13 filed an unspecified number of
$2 cumulative
preferred stock (maximum 120,045 shares) and common
stock (pah
100); (maximum 371,325 shares). The shares
v
preferred
($20
par) and 82,000 shares ($1 par) common
Underwriters—G. L. Ohrstrom & Co, and S. R.
stock.
common
mon.
It also
ance
upon
burger & Hano, Philadelphia. Price—$25.50
exchange
Equity Corp.'s (which see) $3 con¬
of record Dec. 3.
Business—
Livingstone & Co.
Offering—Company is offering the
50,000 shares of preferred, while the 82,000 shares of
and
benture indebtedness. Offering temporarily
v
,v*
'r\
>
ft
W-'
I
•
,
Locomotive
.
Aug. 22 filed $1,500,000 of 5% sinking fund debentures,
due 1961, and 50,000 Shares ($1 par) common stock.
Underwriter—Ames, Emerich & Co., Inc., and Dempsey *
& Co., Chicago;''Offering—The debentures will be of¬
fered publicly. The common shares will be issuable upon *
the exercise of stock purchase warrants for purchase of
common stock at $2 a share above the bid
price of such
common
on
nndemrtters at lO cents
a
25,000
common
warrant.
preferred
Securities Corp., New York.
by amendmeiit
Proceeds—Net proceedsj with
other funds, will be used to redeem
$20,000,000 of 7%
cumulative preferred stock at $115 a share plus accrued
stock.
The remaining war-
-
&
Air
Fund, Jnc., New York
Sept;
share;
American
•
St. Louis
stock fpar $1).
Un^
Offering—Stock Will be
common
.
*
ing—A maximum of 100,000 shares may be sold by eom
to persons, firms, or corporations with whom the
corporation had network affiliation agreements on March
--
31.
The remainder will be offered publicly. Price Jby
amendment. Proceeds—To prepay notes payable to ac-<
^quireVTa'dio^taUonvWX^/itOf!:cpii|toct')tu^adcast^:brahs^
xnitter for station KGO at San Francisco and for
working
-
stock
($5 par)
delphia, Proceeds—<For additional machinery, working
capital and other corporate purposes.
American Cladmetals
voting
common
"" ;'S'
'
3:
Co., uf Pittsburgh
comprising
.
196,500 shares of
stock ($1 par) and 589,500 shares of
non«
1
'
"
1
*,*,?*
^
k
i
h V'
"
'»*■
- -
share.
a
41,000
shares
of -5%
Underwriter—Estes, Snyder
outstanding indebtedness
.
& Co., Topeka,
and expenses and
City, Mo.
Offer¬
..
.
Berg Plastics & Die Casting Co., Jnc. (12/2-13)
(letter of notification) 75,000 shares (10c par)
common.
Price—$4 a share. Underwriter—E. F. Gilles¬
pie & Co., Inc.
tools and
-raw
Proceeds—For acquisition of machinery,
materials, and for working capital.. > : *
Bethlehem Steel Corp., New York
unit.
Proceeds—To retire bank loans of approximately
$100,000, to purchase wood-working machinery and for
working capital. Temporarily postponed.
(11/22)
Nov. 1 filed $50,000,000
of consolidated mortgage 30-yeac
sinking fund 2%% bonds, Series J, due 1976.
Under4j
writers—Kuhn, Loeb & Co., and Smith, Barney & Co;
Price by amendment.
Proceeds—To provide additional!
funds for cost of additions and improvements :to steeJ
June ^5 filed .33,639 shares of
common stdck <par $5),
Underwriters—Rauscher, Pierce & Co. Inc., and E. H.
plants of subsidiaries.
^
.
Rollins & Sons Inc.
Offering—Stock will be offered to
Price by amendment. :Shares are being sold
Armour and Co.,
Birmingham Electric CO.^ Birmingham, Ala.^
Nov, 1 filed 64,000 shares ($100 par) 4.20% preferred,
Underwriting—To be determined by-competitive bid¬
ding. Probable bidders include The First Boston Corp.;
Dillon, Read & Co., Inc.; Blyth & Co., Inc.; Lehman
Brothers; Kidder, Peabody & Co.
Offering—The com-*
Chicago
July 12 filed '350,000 shares (no par) cumulative first
preference stock, Series A; 300,000 shares of convertible
second preference stock, Series A, and 1,355,240 shares
common stock
(par $5).
Underwriter—Kuhn, Loeb &
,Co„ New York.
Offering—The 350,000 shares of first
pany will offer the stock on a share for share
basis to
ferred
exchange;
holders of its $7 preferred
stock, plus
a
cash
stock and $6 pre-]
adjustment.
Shares not re~;(
preference stock, will. be offered in exchange to holders
quired for the exchange will be sold at competitive
and 3 shares -of non-voting
.of its 532,996 shares of $6 cumulative convertible prior
bidding at
Underwriters^None—the company intends to
preferred stock at'the^ rate of 1.4 shares of first prefer¬
voting common $tock ($1 spar),, each imit consisting of
J ^hare Of voting
common.
i
OcL 31
by >six stockholders.
<
? /
ing postponed indefinitely*
con¬
chase of common at $1 per share. Underwriter — Amos
Treat & iCo.-rOfferiiig—To the public in units of -one
share^of preferred and one share of common -at $7 per
share of common.'Underwriter—E. M. Fitch & Co., Phila¬
July-9 filed 196,500 units
,'
cumulative convertible $6 par
preferred.] Offering price,
and 70,000 shares of
common '(40c par)
and warrants for 50,000 shares of
common^stoc& to be sold to underwriter at 5c per share
wairant and exercisable through Oct. I, 1951 for pur-
the public.
f '/*■
K>t\
to open five additional stores in
Kansas
Building Corp., Dover, Del,
; t
(letter bf! notification) 20,000 shares each ($10
par) 5Vo .cumulative preferred and no pareommon. Price,
$10 m unit consisting of une sharedpreferred anb ione Nov. 5
'' i*1
,
Sept. 12 fletter of notification)
Arkansas Western Gas Co*
American
-
y.
Berbiglia, Inc., Kansas dty, Mo.
$6
vertible preferred
pany
<
~
Kans. To pay
27 filed 950,000 shares t$1 -par) common stock.'
Underwriter—Dillon, Read & Co.-Inc., New York. Offer--
-'J',
being sold 'by St. Regis Paper Co., New
York, and the
remaining 40,000 shares are being sold by I.
Rogosin,
President of Beaunit Mills, Inc.
definitely postponed.
Jun e
if"4 -i1
—
^
Price'—^By
-Offering in¬
amendramL^'rProceedte-^Working capital;
-
share.
common. Under-:
White, Weld & Co., New York. Price — By
amendment. Proceeds—Of the
total, 140,000 shares are
Ansiey Radio Corp., Trenton, N. J.
Aug. 29 filed .70,000 shares of Class A cumulative
Broadcasting Co*, Inc., N. Y«
a
.
tion to ^officers -and ^directors of the company;
working -capital.
at $105
Beaunit Mills, Inc., New York
Sept. 27 filed 180,000 shares ($2.50 par)
common
stockholders in
one additional share for each two shares
Unsubscribed;shares will be offered for subscrip¬
held.
If
convertible 4% Series A,
production, and .expansion of refining,
transportation and marketing facilities. Offering tempor¬
arily postponed.
J
the ?ratib of
offerings are made
in the State'of Maine, they will be made by Frederick
aaams &' Co., Boston.
To complete plant and equip¬
ment and to provide
filed 336,550 shares
derwrlting—No underwriting.
offered for subscription to
Lanes, lnc., Portland, Me*
stock,
The balance will-be added to
general funds for corporate
purposes including repayment of
obligations, acquisition
of
additional
writer
.
a common
of
are
Co.
American Zinc, Lead & Smelting Co.,
Oct. 9 "(letter of notification) J5,000 shares -each of pre¬
ferred and pOmmon. i Offering vptice, - $10 a preferred
share and 1 cent
shares
proceeds will be
applied to redemption of the company's cumulative
pre¬
ferred
(jointly), and W. C. Langley & Co. and The
First Boston Corp. (Jointly).
Offering—Price to public
by amendment.
JJoy. J8 4iled!2,878,834 shares of common. Underwriter—
Lord, Abbett & Co., Inc.; New York. Price based on
market
price. - Proceeds—For investment;/Biisiness----Investment fund.
preferred
scribed shares will be sold to the
underwriters who will
reoffer it to the public.
Price by amendment.
Proceeds
'^-A maximum of
$15,540,000 of the net
American Water Works Co., Inc., N. Y.
March 30 fUed 2^43405 shares of common
.(par $5) pirn
—i
—-•—u.
an additional number determinable —*—
only after the re¬
sults of competitive bidding are known. Underwriters—
To be filed by amendment.
Probable bidders include
Dillon, Read & Co. Inc., White Weld & Co., and Shields
.
Affiliated
Undcror4ting--4ihioh
dividends; Indefinitely postponed.
rants will be sold to officers and
•
a
Oct. 29j filed 293,000 shares
($100 par) cumulative pref¬
erence stock.
Underwriter—Smith, Barney & Co., New
York.
Offering—Stock will be offered for
subscription
to common stockholders on
the basis of one share of
preference stock for each nine shares held^
Unsub¬
IPrice
Com¬
shares to the
employees of the company. Price—Debentures at 98. Proceeds—Company will
iise $1,025,000 of proceeds of debs, -for
payitient of an
fndebtedness to Bankers Trust Co., New York. Balance,
will be.added to working capital. Offering postponed.
Co.', New York
July 18 filed 100,O0Qiihares each of $100 par prior pre¬
ferred stock and
convertible seoohd
the effective date of the registration.
pany will sell warrants for
reserved for issu¬
Underwriter—New-
Atlantic Refining Co.,
Philadelphia
'
'
Aerovox Corp., Bedford, Muss.
common
-
^'1
tfA-
(par $1).
Underwltiter^Riter & Co. Proceeds—Stock being sold
Harry Bloomberg, President. Price -By
amendment Offering date indefinite.
for account of
postponed.
*,v*t
stock
common
100,00
shares of common
American Limoges Chma Corp., New York
■■
filed 75,000 shares of
shares of
common.
The remaining 50,000
being sold by three stockholders.
Estimated net proceeds of
$2,300,000 will be used by
the company to pay off bank notes of about $1,100,000
and to purchase additional machinery and equipment
in the amount of $1,200,000. Offering date indefinite.
are
Sept;
covers
conversion of preferred.
share
Investment company,
being sold for the account of certain stock¬
Prices—$20 a share for the preferrcdr and
$11.50 a share for the common. Proceeds—Company will
applyproceeds to fully, discharge secured derpand
notes,
mortgage notes and partial
discharge of de¬
_
and $12 a common share.
Proceeds—Company will
receive proceeds from the sale
of all of the preferred
vertiblefpreferred stock
holders.
_
Sept. 27 filed 53,648 shares ($25
par) 4J/2% cumulative
convertible preferred and
150,000 shares ($1 par) com¬
will be issued under terms of three
alternative
offers to holders of
N. J.
cumulative
.
used" to retire~ail
Artcraft Hosiery
Co., Philadelphia
American Genera) Corp., New York
Nov.
Acme-Hamilton
■*
unexchanged shares of $6 prior stock and to redeem its
outstanding 7% preferred stock. Temporarily postponed,
,
pates it will use the funds for its
program.
.
proceeds will be
:
rants for common
common
distribute its common
stoekdirectly ?to the public. Uffer-]
lag—Price $6 •per unit.
Proceeds—Net ,proceeds esti*«
ence
stock for
rebch^hare: of $6 prior preferred.; Bhares
Proceeds—Proceeds,
(Continued
^SPECIALISTS IN
•'
;
~
on page
2656)
,
mir
'.v,
'•
together rwith
'X.
„
v
J
-V »\
*
'i
1
:-tr
—
*
'
^
r't,» * \-
«,S
i
'
-'
Y', 'i'*
-
United States Government Securities
☆
State and
Underwriters- and Distributors
of\
Corporate and Municipal
;
Municipal Bonds
Securities
'The
CJ. DEVI N E
FIRST BOSTON
J
•«
New York
♦
Pittsburgh
and other cities
CO.
Kidder,Peabody ^Co.
l"'-
;
48 WALl ST., NEW YORK 5, N. Y.
Boston
&
-INC.'
CORPORATION
HAnover 2-2727
.
!
•
Chicago
•
"
Chicago
*
*
Boston
*
Cincinnati
Philadelphia
•
St. Louis
•
•
Pittsburgh
'
Cleveland.
San Francisco
,
-i-y
„
v
T ';
-ff
^
,
,
.
.
.
-1
•ft
"
''
Members of the
New York
,
a
$2,500,000 bank loan, will be =used to redeem fthe «old.
of first preference not'issued in exchange will be ^old
☆
Corporate and Public Financing
price not less sthan $100 per share net to
a
the" company.
'
t
Founded 1865
New York and Boston Stock Exchanges
] ,:'Boston
Philadelphia *
Chicago
THE COMMERCIAL & FINANCIAL CHRONICLE
2656
(Continued from page 2655)
—
system. Business—Public
distribution and transportation
utility.
California Oregon Power Co.
| Y Central Soya Co., Inc., Fort Wayne, Ind.
May 24 filed 312,000 shares of common stock (no parJv - Aug. 21 filed 90,000 shares
(no par) common. Under*
Stock will be sold through competitive bidding. Under¬
writers
Glore Forgan & Co., Chicago. Offering —
writers—Names by amendment.
Probable bidders in- M Common shares initially will be offered for
subscription
dude Blyth & Co., Inc.; The First Boston Corp.; Harrl- ; to
common1'stockholders at rate of one share for each
man iRipley & Co.
Offering—Stock is being sold byV 7% shares held. Unsubscribed shares will be sold to
Standard Gas and Electric Co., parent, of California. 2 underwriters. Price
by amendment. Proceeds—Working ;
Bids Rejected—Standard Gas & Electric Co, rejected
capital, etc; Offering indefinitely postponed.
;
v
June 25 two bids for the purchase of the stock as un¬
satisfactory. Blyth & Co., Inc., and First Boston Corp. !
Chase Candy Co., St. Joseph, Mo.
bid of $28.33 a share, and Harriman Ripley & Co. bid
Sept. 12 filed $2,500,000 of 4% sinking fund debentures,
of $24,031 a share.
Stock will again be put up for sale
due 1961; 100,000 shares ($20 par) 5% convertible cumu¬
when market conditions improve.
lative preferred, and 170,000 shares ($1 par) common.
Underwriters
F. S. Yantis & Co., Inc. and H. M.
California Water Service Co. (12/3)
Byllesby and Co. (Inc.), Chicago, and Herrick Waddell
Oct 28 filed 50,000 shares common stock (par $25). Un¬
& Co., Inc., New York. Offering—Common will be of¬
derwriters—By amendment. Probable bidders include
fered for subscription at $10 a share to common stock¬
Blyth & Co., Inc.; The First Boston Corp.; Harris, Hall
holders at rate of one share for each two shares held
& Co. (Inc.) i
Proceeds—To repay bank loans used in
of record on Oct. 19. Shares of common not subscribed
part for 1946 construction work, to restore working capi¬
for will be offered for sale to
officers, directors and
tal used for additions and improvements and to defray
employees. Price—The debentures, will be offered at
part of cost of future additions, etc. Bids Invited—Bids
$100 and the preferred at $20 a share. The common will
for the purchase of the stock will be received up to
be offered to stockholders at $10 a share. Pursuant to the
10 a.m. PST on Dec. 3 at office of American Trust Co.,
common stock subscription
rights, F. S. Yantis & Co.
450 California/St^: $an Francisco. : ; *. \
V>v y; v, *
will purchase 100,000 shares of the 170,000 shares of
common for investment. Any of the remaining 70,000
Cameron Aero Engine Corp./ New York
shares which are not subscribed ior by stockholders and
Oct. 2 (letter of notfication) 60,000 shares of common.
officers, directors and employees will be sold to the
Offering-—Price $2 a share. ? Underwriter—R. A, Keppler
.
additions to its electric
preferred stocks and to finance
y/'yy
& Co. Inc., New York
(Sidney)
Blumenthal
Aug. 30 filed 119,706 shares (no par) common and sub¬
scription warrants relating to 30,000 shares thereof.
Underwriting — None. Proceeds—For reimbursement;:
.
company's treasury for funds expended in - re¬
demption of 3,907
shares of 7% cumulative pre¬
ferred on April 1, and for funds deposited in trust for
of
redemption on Oct. 1 of remaining preferred shares. Al¬
though it was proposed to offer the stock for subscrip¬
tion to stockholders at $10 per share, company on Sept.
20 decided to withhold action at this time.
—
Inc., New York
Book-of-the-month Club,
stock.
Offer-;
shares
and six stockholders, including Harry Scherman, Presi¬
dent, and Meredith Wood, Vice-President, are selling;
the remaining 200,000 shares.
Price by amendment.
Proceeds—Company will use its net proceeds for work-s
ing capital to be used for expansion of inventories of
paper and other raw materials and book inventories.*
shares ($1.25 par) capital
Underwriter—Eastman, Dillon & Co., New York.
ing—Of the total, the company is selling 100,000
Oct.
28
300,000
filed
Boston Store of Chicago,
Inc.
underwriters. Proceeds—Net proceeds, estimated at $5,New York.^ Proceeds-*-To demonstrate the
flight tests in company-owned plane.; , 856,125, will be used to pay the balance of the purchase
price, amounting to $5,150,000, for acquisition of the
candy manufacturing business operated by Clinton In¬
Camfield Mfg. Co., Grand Haven, Mich.
dustries, Inc., as its national candy division with plants
July 29 filed 220,000 shares ($1 par) common stock. Un¬
in St. Louis, Mo., and Chicago. The balance will be used
derwriters—Gearhart & Co., Inc. Offering—Of the shares
to redeem its 4% serial debentures, and for additional
registered, 100,000 are issued and i outstanding and will
working capital.
be sold to the underwriters by three stockholders at
$4.50 a share for their owrr account. The remaining Y
China Motor Corp., New York
120,000 shares are being offered by the company, Price
Oct. 24 filed 7,500 shares ($100 par) Class A stock, en¬
$4.50 a share. Proceeds—Company's share to pay rene- Y
titled to 6% preferential dividends* cumulative from/
gotiation refund in amount j of; $180,000;■ to the U. S.
July 1,1947, and to participating dividends. Underwriter
Government, and for additional working capital. Offer¬
—None.
Offering—Company, expects to sell the stock
ing date indefinite.
largely to members of Chinese communities% in the
United States and elsewhere.
Canadian Admiral Corp. Ltd., Toronto
Price—$101 a share. Pro¬
ceeds—Net proceeds, estimated at about $748,500, are
July 8 filed 150,000 shards ($1 par) common stock.
& Co., Inc.,
Sept. 10 filed 30,000 shares ($50 par) 5% cumulative
preferred and 500,000 shares ($1 par) common. Under-f
writers—Paul H. Davis & Co. and Stroud & Co., Inc.
Cameron Engine by
have non-detachable stock
purchase of 30,000 shares of com¬
mon stock of the total common, 375,000 shares will be
offered for sale for cash. 30,000 shares are reserved for
will
Offering—Preferred
purchase warrants for
issuance upon
exercise of warrants attached to
preferred
shares are reserved for issuance upon exer¬
of outstanding warrants. Price—By amendment.
and 95,000
cise
Proceeds—Net proceeds,
together with other funds, will
amount of $5,268,750 and accrued
the principal
in
interest.
the company's 2% subordinated note
be used to pay
Offering date indefinite.
Gum, Inc., Philadelphia
Bowman
Sept. 27 filed 268,875 shares ($1
writer—Van
par) common. Under¬
Alstyne, Noel & Co., New York. Price—By
at
amendment.
Proceeds—Stock is being sold by share¬
chase of machinery and
and
proceeds.
share for
for
present stockholders. Net proceeds to the company, es¬
timated at $147,500, will be used to prepay to the ex¬
Indefinitely delayed.
e
15 filed
Aug. 9 filed 76,000 shares (no par) capital stqek. Under¬
writers—A. G. Becker & Co., Inc., Chicago.
Price, by
amendment. Proceeds—Shares are being sold by stock¬
holders. Temporarily postponed.
50,000 shares
($100 par)
Underwriters—William
ferred.
Becker & Co. Inc. of
Chicago.
$105
able at
Co.
and A.
the
G.
Price—By, amendment.
share plus dividends; balance for general
Business—Operation of Chicago
a
eral Finance Corp., issuer's sole stockholder, is offering
common for its own account. Price of preferred
$10
cumulative pre¬
Blair &
Proceeds—Proceeds will be applied toward the redemp¬
tion of 19,900 outstanding $6 preferred shares, redeem-
Union Gas Co.
May 3 filed 70,000 shares of cumulative preferred stock,«
($100 par). Underwriters—To be filed by amendment. \
Bids Rejected—Company July 23 rejected two bids received for the stock.
Blyth & Co., Inc., and F. S. Mose- |
ley & Co. and associates submitted a bid of 100.06 for a
4.30% dividend, Harriman Ripley & Co. and Mellon ;
Securities Corp; bid 100.779 for a 4.40% dividend.
In¬
definitely postponed; ,
.k
share; price of common $4 per share. Proceeds of
preferred to pay company's indebtedness to General
Finance Corp., purchase; equipment and real estate: an<f
for working capital. Indefinitely postponed.
per
■
•
Coca-Cola Battling
Nov.
Central & South West Utilities Co.
.
Aug. 30 filed its ($5 par) capital stock.
Company's name
is to be changed by post effective amendment to Central
& South West Corp.
(Del.)
invitation for sealed bids
for the purchase of a sufficient number of such shares
will
same
be
constituted upon
proposed merger into the
consummation of a
issuer of American Public
Service Co., to provide funds for
retiring the preference
shares of the issuer and American
Public
Service
Co.,
not exchanged for shares of the merged corporation.
remaining 10,000 shares are reserved i
Underwriters by amendment.
for issuance upon the exercise of warrants attached to
Possible bidders: Glore,
the preferred. Price by amendment. .Proceeds—To re- > Forgan & Co.; Lehman Brothers-Lazard Freres & Co.
Imburse treasury for purchase of machinery and equip- ;;
stockholders. The
(jointly); Smith, Barney & Co.-Harriman, Ripley & Co,
Co/
of St. Louis
6
(letter of notification) a maximum of $100,000
($1 par) common to be offered for subscription to em¬
ployees at $32.50 a share.
No underwriting.
To be
deposited in company's bank accounts.
Prospectus will be issued
in connection with the public
as
shares ($50 par) 5 % cumulative
preferred and 120,000 shares ($2.50 par) common. Underi writer—EC. M. Byllesby and Co. (Inc.),.Chicago.
Offer¬
ing—Of the common, 110,000 shares are being sold by
pre¬
preferred ($10 par) and ,250,000 shares ($1 par) out¬
standing common stock. Underwriter—Brailsford & Co.
Offering— company is offering the preferred and Gen¬
corporate purposes.
department store.
Burgess-Norton Mfg. Co., Geneva, III.
cumulative
^
Scott & Co., Chicago
Carson Pirie
Nov.
Briggs & Stratton Corp., Milwaukee
Sept. 23 filed 10,000
Sons, Inc., Augusta, Ga.
The securities
capital.
possible rputstanding $149,300 mortgage liabilities.
Offering date indefinite.
,
(H. H.)
ferred and*35,000 shares ($1 par) participating convert¬
ible preferred; Underwriter—Johnson, Lane, Sbace
tent
-
branch plant in Canton, China,
a
Co,, Inc., Augusta. Price—By amendment, Proceeds—?
are issued and outstanding and are being
June 24 filed 400,000 shares of common stock.
Under-, 'i sold by the executors of the estate of George F. Clausseii
and by Euclid Claussen, President of the company, who
writer—Registrant will supply name of an American
underwriter by post-effective amendment.
are sole stockholders.
Offering—
To the public at $1 a share in Canadian funds. Proceeds
Climax Industries, Inc., Chicago
—For a variety of purposes in connection with explora¬
tion, sinking of shafts, diamond drilling and working
Aug. 28 filed 150,000 shares 5% convertible cumulative
—
(N. Y.)
working capital,
Nov. 7 filed 7,500 shares ($100 par) 5%
Porcupine Gold Mines, Ltd., of Toronto.
Ontario
common.
Brooklyn
additional
Carscor
are
'
establishing
Claussen's
corporate
.
$25 a share for preferred and $11
Proceeds—7,000 preferred shares
being sold by company, the remaining 5,500 pre¬
ferred shares and all of the common are Keing sold by
New York. Price
available
,
Sept 25 filed 12,500 shares ($25 par) 4V2% cumulative
convertible preferred stock and 50,000 shares (200 par)
common stock. Underwriter — C. K. Pistell & Co., Inc.,
a
in
pur¬
equipment/and tools, jigs/dies
balance will be
fixtures;
as
payment of indebtedness and to provide capital to aid
stockholders of Admiral Corp.
common
Proceeds—$75,000 is earmarked for
share.
a
purposes.
(Harry), Inc., Wilmington, Del.
Braunstein
$3
expected to be applied
Offering—Stock initially
Underwriter—Dempsey & Co.
will be offered to
holders who will receive
Thursday, November 21, 194$
Colonial Airlines, Inc., New York
Oct. 25 filed 150,000 shares ($1 par) capital stock. Under¬
writer—Auchincloss, Parker & Redpath, Washington,
D. C. and Hornblower and Weeks, New York. Price by
amendment. Proceeds—Net proceeds will be used to pay
off
$550,000 loan to the Continental Bank & Trust Co.
development ex«penses of Bermuda route/ The balance will be used to in^
crease working capital.
1
,
;
a
of New York; purchase equipment and
Colonial Sand A Stone Co., Inc., N. Y.
August 15 filed 300,000 shares ($1 par) common stock/?
Underwriters—Emanuel, Deetjen & Co., New York. Price
by amendment. Proceeds—Company will receive pro¬
ceeds from the sale of. 150,000 shares and Generoso
Pope,
a cost of $98,386 and payment for new building
being constructed at estimated cost of $223,700; balance Y (jointly); Blyth & Co., Inc., Stone & Webster Securities
for purchase of additional machine tool equipment.
Corp. and First Boston Corp. (jointly). Price by amend¬
Of¬
fering indefinitely postponed.
ment.
$ President of company, who is selling the remaining 150,-
ment at
,
•
•
*
,
•
•
.jr.*
•
•
•
•
•
*
,
•
-
•
•
»
•
•
...
•
.
•
,
*
•
•
•
•
Underwriters
UNDERWRITERS—DISTRIBUTORS—DEALERS,
:
.
'X
-
'
s; }i*
......
:V-!' 1 *
Y
V Y
Y/'•/;y
\7
The Marine Midland Trust
I*-
Industrial, Public Utility/Railroad
and
Company
j
OF NEW YORK
Agent
Registrar
•
•
Distributors
Municipal—Railroad
Public
Municipal Securities
Transfer
•
of
Utility—Industrial Securities
Trustee
Oireet coqtact with Markets in principal financial center*.
'
ONE HUNDRED TWENTY BROADWAY
Hemphill, Noyes CS, Co.
NEWYORK
15/N.Y.
.
YYYYY- Y"',:-: Members New York Stock Exchange Y:Y:YYYYY:;''?
NEW YORK
ALBANY
Y
CHICAGO
Y
'■Vi
'
PHILADELPHIA
PITTSBURGH
TRENTON
•
;
v'v"Y-*^Y
Y.
:
:V
WASHINGTON
..V
Yv
i-Y,
'.■•y «...'.•
Y '
<"
-YY
Y■■■;VY>t.vi-'-v
Y-VY-.Y'.-yY Y/.Y -;Y
.
'jk
*
•
-
;•
•
•
*•
V
::Y.v:YY?Y-.--:-;''Yt Y'';YV;Y'YYv*
-V-/Y>Y Y';
•
•'•■Y
•
.
••*-••
?.•
:'4 -4
* rf'
E. H. Rollins & Sons
v
,
Incorporated
,
•
Y*:;-''YY--';Y;;K:OY'-V< •'
Y-'i A:'---":Y-Y '?{: "Y Y/.Y?
X.:^/"v'-.YY;;Y. V •.YvY'"/''^:
•
"I
'
RECTOR 2-2200
INDIANAPOLIS
*
♦0 Wall
New fork ':
.s-
Boston
Street, New York 5, N. Y.
..
Philadelphia
•
Chicago
San Francisco
LVolume 164
Number 4544
■
THE COMMERCIAL & FINANCIAL CHRONICLE
Continental
NEW ISSUE CALENDAR
•
'
'<
'
«J
■
"•
f
k
$
*
'<
♦,*
^
'
I
-•
>
,,
*
,
?
\
'T 1
/
v
November 22, 1946
Bethlehem Steel Corp,--...,-
——^Bonds
November 25f 1946
Fashion Frocks, Inc.—
Medesan
Multi-Facet Diamond Corp....:
Class A
;
November 27, 1946
General Motors Corp.....
Unexcelled Chemical Corp
.Debentures
77:
,
10 a.m. (PST)—.......
Continental-na-var Corp.
Offerihg date indefinite.
7 :7#*
.Preferred
Equip/Trust Ctfs.
.Bonds
15 filed $9,861,000 of first mortgage bonds, sinking
series, due 1961, and $3,000,000 of second mortgage
bonds, due 1962.
Underwriters—To be determined by
competitive bidding.
Probable bidders include Halsey,:
Stuart & Co., Inc.
Proceeds—Proceeds, supplemented
by other funds, will be used to redeem the outstanding
International Paper Co. 1st & ref. 5% sinking fund mort¬
fund
7/,:7
These bonds were assumed by
which together with System
Properties, Inc. will be merged into Eastern New York
amendment.
(EST).......—.......Equip.
selling
Power; subject to approval of the SEC. Business—Public
utility.
•
equipment. Any balance will
be* added
to
forking capital. Indefinitely postponed.
T
issue
of
preferred
stock,
,
the
$55 a share plus accrued
dividends.Funds for the redemption will be
supplied
by a .short term bank loan. ; Proceeds from the sale of
June 26 .filed
convertible
Inc.
*
shares
and
58,850ys
of
o
V'"V'
i
' j>'\ X
*
,V{"
-
faction
of
funds
10,500 shares
«■"
"
_
($25
par)
5%
add
'
Dansville, N,
Y.
,[
x,
^
.
,?v * '/
v' /
,
^ ''j ' w.' 1 *!!>.«'
\
,
/
'-
•
~
'
Co., Inc., Jackson, Miss. '
(200 par)
common.
Under¬
contracted for. The balance will be
v^prking capital.
—
on
;
Price
Telephone Co., Madison, Wis.
($100 par) ; $4 cumulative
Paine, Webber, Jackson &
aishare for share basis; plus cash adjust¬
exchanged will be sold to underwriters.
by amendment. Proceeds—To
redeem
at
$110
a
share, plus divs., all unexchanged old shares.
7/77/777
1 t
7,77,.
Continental Car-na-var Corp.,
Nov.
4
(letter of notification)
Brazil, Ind. (12/3)
common
and
one
after present public offering.
year
.mon
share,
35,000
one
shares
warrants for purchase
cent
a
warrant.
Sherman &' Co., New York.
,'
* %
'**
'v
■r
T
.
01
1
v
vm'
* \
*
<
>
i'
n
,
r>
'
-
Equitable Life & Casualty Insurance COn:
Lake City
Salts
notification) 90,000 shares of common.
policyholders at the rate of 11 shares
per $1,000 of insurance at $2 a share.
No underwriting.
To raise capital and surplus required by law to qualify
an old line legal reserve capital stock life insurance comOct. 16 (letter of
To be offered to
Equity Corp.,
New York
1,650,330 shares of new (lp^ par) 200 divi¬
dend preferred and 247,550 shares 7(100.< par) common./
Underwriter—No
underwriters.
Offering—Shares
of
Nov. 13 filed
Equity's common and new preferred not issued under
the exchange offer, of American General Corp. (which
see) will be offered for subscription to Equity's stock¬
holders on the basis of $50 a unit consisting of 10 shares
of new preferred and 1% shares of common.
Proceeds—
Proceeds will
be
used toward redemption of unex¬
Business—Investment
changed shares of old preferred.
company.
1
»
ErO Manufacturing Co.,
Chicago
105,000 shares common stock (par $1).
Underwriter—Straus & Blosser, Chicago. Price—$11.50
a share.
Proceeds — Shares are being sold by stock¬
Sept.
5
filed
holders. Offering
date indefinite.
Falk Mercantile Co., Ltd.,
Chemicals"Int.V
■
-'
.7;
7
.77
Boise, lda.
notification) 3,000 shares of 4%% pre¬
Price—$100 a share. UnderwriterChilds, Boise, Idaho. Proceeds
retire debentures and for expansion purposes.
Oct. 21 (letter of
ferred
($100 par);
Richard Meade Dunlevy
(A. B.)
Co., York, Pa.
class A and 20,000 shares (10c par) common. Price, $10
a .unit consisting of one share of class A stock? and 2
Sept. 26 filed 30,000 shares ($25 par) cumulative con¬
vertible preferred; 45,000 shares ($5 par) common; and
an unspecified number of common shares to permit con¬
version of the preferred. Underwriter—Stroud & Co.,
Inc.,
Nov.
7
(letter of notification)
common.
•
Boston,
10,000
Mass.
shares
($1 par)
General Stock & Bond Corp. Boston,
12
(letter of notification) 50,000 shares ($1 par)
Price—$2.50 a share. No -underwrit¬
For working capital and expansion.
class A
ing.
of
common
a com-
Underwriter—L.
For working capital.
D,
/
$800,000 to reduce principal on outstanding
Frocks, Inc. (11/25-29)
120,000 share? ($1 par) common: stock.
Underwriter—Van Alstyne, Noel & Co. Offering—Offer¬
ing does not constitute new financing but is a sale o®
currently outstanding shares owned by members of tne
Meyers family, owner of all outstanding stock. > Price-—
Fashion
July
.
bank loana.
common.
Dobbs Houses,/Inc., Memphis, Tenn.
Sept. 27 filed 75,000 shares ($1 par) common. Under¬
writer—Emanuel, Deetjen & Co., New York. Price—By/
amendment.
Proceeds—Net proceeds will be used for
expansion of business consisting of airline catering and
indefinite.
coffee
shop operations. Date of offering
.
24 /filed
$9 per share.
Fiduciary Management, Inc.,
Drayer-Hanson, Inc.,
Los Angeles
(12/12-13)
Aug. 12 filed 80,529 shares ($1 par) class A stock, con¬
vertible into common stock (par $1).
Underwriters—
Maxwell, Marshall & Co., Los Angeles. Price—To public;
$10.25 a share.
Proceeds—Net proceeds, estimated at
Jersey City, N. J,
shares ($25 par) common Under¬
writer—No underwriting.
Offering—Stock will be of¬
fered for subscription to common stockholders on the
basis of four additional shares for each one share held.
Price—$3 a share. Proceeds—To increase capital so
Sept. 27 filed 867,420
($1 par)
Price—$2
Price—By amendment. Proceeds —
$355,350 4%% sinking
fund mortgage bonds, due Aug.
1, 1957, to pay - off
certain contracts and chattel mortgages of $72,000 ana
Philadelphia.
Proceeds will be used to redeem
Disticraft, Inc., Chicago
Nov.
restaurant and
132,500
4
v.
"
,
Farquhar
Devonshire
| Shares will be offered for exchange for $5 cumulative
ment. Shares not
'
and expand the business. The
lines of products
'!
LV.'v^Vu
to
.
Curtis and Stone & Webster Securities Corp. Offering—.
preferred,
,
'1
7.-:7'/'..V.
70,920 shares ($1 par) common. Under¬
£. G. McDonald & Co., Detroit. Price — $5.50
share. Proceeds — Stock is being sold by six share¬
Sept. 23 filed 16,071 shares
—
• T
shares of
machinery and inventory.
Underwriters
>'
fering temporarily postponed.
S
•
pre¬
common.
selling agent. For working capital.
;
new
and 71,950 shares
holders wKo will receive proceeds.
Boston.
For working capital.
agreement in satis¬
shares will be sold to employees and it is expected that
the remaining 20,360 shares will be sold to persons under
the trust agreement., Prlce-r$7.25 a share.
Proceeds—.
preferred.
'
c
ferred shares will
III.
cumulative
filed
Sept. 25
a
by the trust to the company;
to be isstied to satisfy options, 2,300
Commonwealth
^
,cVl
remaining 100,000 shares of common stock and the pre¬
be sold by present stockholders. Of¬
y
loaned
are
For purchase of
•
starting operations of four plants, two of which al¬
writer
Oct. 28 filed 89,580 shares ($5 par) common.
Under¬
writing—None. Offering—Of the total 56,420 shares are
persons under a trust
;t ' J
,
Detroit Typesetting^ Co., Detroit, Mich.
Columbia Axle Co., Cleveland, Ohio
/to be issued to
shares
6,300 shares of
ready have been
loan to Palmer Brothers Engines, Inc.,
a
subsidiary; balance for purchase of machinery and
equipment and working capital.
~
'■
*
and
added to
as a
,'r
y
remaining 150,000 shares are being sold by Apponaug
Manufacturing Co., Inc. Principal stockholder estimated
net proceeds to company of $1,007,913 will be added
to general funds to be applied for corporate purpose.
Company anticipates expenditures of $300,000 in 1946
and $300,000 in 1947 for equipping and absorbing; costs
payment
-"V
62,000
Oct. 2 filed 300,000 shares
of Federal taxes; $250,000 for payment of Lincoln-RFC
>\JY"
V
writers—Names by amendment. Price, $8 a share. Pro—;
ceeds—Of total, company is selling 150,000 shares and
shares not subscribed to by common stockholders will
be offered to the public through underwriters.
Price—$5
a share.
Proceeds—Approximately $50,000 for
y
filed
Delta Chenille
Rights
expired Aug. 20. Stockholders subscribed for 735 shares.
The offering to common stockholders excluded the two
principal stockholders who waived their rights to sub¬
loan; $50,000
*v *
preferred.
remaining ; 90,414%
'
~
Price, $10 a unit.
To be sold through employees of the company. For work¬
ing capital and other corporate purposes.
shares for subscription to present common stockholders
of record Aug. 6 at $4.50 a share in the ratio of one share
of preferred for each share of common held.
The
r
>
(letter of notification) 13,700 shares of 7%
ferred
Underwriter—Floyd D. Cerf
Co., Inc., Chicago. Offering—Company offered 59,585 y3
scribe.
»
.»r /
pany.
150,000 • shares I$4 par) 30c cumulative
stock, convertible into common
initially of iy2 shares of common for
of
7/
Dansaire Corp.,
preferred
share
* "■
i
indefinite.
stock in the ratio
each
'
£
;
Aug. 28 filed 50,000 shares of $1.25 cumulative converti¬
ble preferred stock, (par $25) and 150,000 shares of
common
stock
(par $1). Underwriters—Van Alstyner
Noel & Co. Proceeds—Corporation will receive the proceeds from the issuance of 50,000 shares of the common
stock which will be used to increase productive capacity*
to
Nov, 6
Columbia Aircraft Products
:.
-
1
Empire Millwork Corp., New York'
(par $2)
common stock 40,000 by
company and 31,950 by certain
stockholders. Underwriters—Paul H. Davis & Co., and
Shillinglaw, Bolger & Co., Chicago. Price by amend¬
ment. Proceeds—Company will use proceeds, together
with a $1,000,000 bank loan, to purchase
machinery,
buildings and to retire bank indebtedness. Offering date
company plans to call its $3 cumulative convertible
pre¬
ferred stock for redemption at
preferred, together with other funds, will be used
repay the bank loan. Indefinitely postponed.
..
..
convertible preferred stock
preferred stock.
Underwriter—Union Securi¬
ties Corp., New York.
Price by amendment.
Proceeds
proposed
A
July 26
vertible
the
20
t*
Proceeds—Go to Joseph Levy, President,
Danly Machine Specialties, Inc., Cicero,
Colorado Milling: & Elevator
Co., Denver, Colo.
Aug. 20 filed 70,000 shares ($50 par) cumulative con¬
to
Edgemont Stamp and Management Co.,
Pittsburgh, Pa.
(letter of notification) 650 shares of common
($5 par).
No underwriter.
Proceeds—Working
capital.
1
May 31 filed 500,000 shares of common stock (par $1).
Underwriters—Sabiston-Hughes, Ltd., Toronto. Offer¬
ing—Share? will be offered to the public at 75 cents a
share.
Proceeds—Net proceeds, estimated at $300,000,
will be used for mining operations.
000 shares will receive proceeds from these
shares. The
1
stock
stockholders. Offering date indefinite.
Trust Ctfsi
company will use its proceeds for payment of
mortgage
notes, open account indebtedness and for purchase of
—Prior
bonds, due 1947.
gage
Hudson River Power Corp.
Cyprus Mines, Ltd., Montreal, Canada
additional
Eastern New York Power Corp., New York
•
Nov.
Delaware Lackawanna & Western
RR.,
noon
warrant.
Nov.
Crawford Clothes, Inc., L. I. City, N. Y.
Aug. 9 filed 300,000 shares ($5 bar) common stock.
Underwritefs—First Boston Corp.; New York. Price by
...Class A
December 15, 1946
12
Offering—Price $3 a common share and five cents
Underwriter—Amos Treat & Co., New York.
machinery, plant renovation and working capitaL
Offering date indefinite.
a
capital. Offering date indefinite.
December 12, 1946
Drayer-Hanson Inc
.v.
For
chase machinery and equipment and to construct a new
office building. The balance will be added to working
December 10, 1946
Electric Co.
Corp., Clearwater, Fla.
mon.
by amendment.
Proceeds—Of the shares being offered
company is selling 100,000 shares and 15,000 shares are
being sold by a stockholder. The company will use its
proceeds to provide additional factory space and pur¬
..Common
...
Inc.
(letter of notification) 99,000 shares of common
purchase warrants covering 50,000 shares of com¬
and
Copco Steel & Engineering Co.,, Detroit
Aug. 19 filed 115,000 shares ($1 par) common. Under¬
writer—E. H. Rollins & Son, Inc., New York.
Price
^...Common
Philadelphia Electric Co
Philadelphia
Durasite
tures, due 1967, to pay certain debts and for additional
<*cruipment, manufacturing space and working capital.
December 3, 1946
/California Water Service Co.,
V
Airlines,
of
Oct. 11
preferred.
Underwriters—Otis & Co. and
Co., Inc. Offering—To the public. Price—
$25 a share.' Proceeds—Estimated net proceeds of $1,356,200 will be used to redeem its outstanding 4% deben¬
Sales Agreements
-
(letter
Prescott &
...
Missouri-Kansas-Texas.._Cond,l
pay-
notification) 12,000 shares ($5 par)
Class A common and 8,000 shares ($5 par)
Class B
common.
Offering—Price $5 a unit. No underwriting.
For purchase of additional flight and servicing equip¬
ment, payment of deferred salary balances, for woriung
capital and other expenses.
convertible
..Common
December 2, 1946
Berg Plastics & Die. Casting Co. Inc,
Common -'7
Harmon (William H.) Corp,:.
.Capital Stock
Southern Ry., 12 noon
(EST)
Duluth (Minn.)
15
off loans and accounts
pay
•• •„
.
Oct.
Cooper Tire & Rubber Co., Findlay, Ohio;/;-k+M
July 17 filed 60,000 shares ($25 par) 4%% cumulative
Capital Stock
•'■7".v :V.'''
able.
Preferred
„
December 1, 1946
Edgemont Stamp & Management Co
Public Finance
Service, Inc
;;
$694,761, will be used to
Continental-United Industries Co., Inc.
Aug. 2 filed 150,000 shares ($1 par) common. Under¬
writers—Aronson, Hall & Co. Price
$8.25 per share.
Proceeds—To repay demand loans and for general funds.
(Originally company filed for 80,000 preferred shares
par $25 and 350,000 common shares.)
>.
-!/
Common
.....
Muskegon, Mich.
July 8 filed 250,000 shares 4V4% cumulative convertible
preferred stock, Series A ($50 par). Underwriters—Van
Alstyne, Noel & Co.
Offering—Price by amendment.
Proceeds—For rearrangement and expansion of the com¬
pany's manufacturing plants, acquisition of additional
tools and facilities, and for additional working capital
requirements. Offering indefinitely postponed.
;
f|g
probable date of offering)
'
'
7
V
,v
'
Motors Corp.,
2657
2658
THE COMMERCIAL & FINANCIAL CHRONICLE
(Continued from page 2657) :;
\
financing.
Films
Glencair
'.'V////,
company may expand operations in the field of develop¬
ment and
reorganization
,.
class
A
stock
common
is
initially
convertible
into
2
Alstyne, Noel & Co.
Proceeds—$201,-/
funds, will be used for production of educational
films.
Nov.
Leesburg, Fla.
(letter of notification) 27,000 shares of $10 par
Price
$11 a share.
Underwriter
Florida'
Securities Co., St.
Petersburg, Fla.
Proceeds—For ex¬
—
Food
Fair
■
'
for
/
'
Holt
Yorkcommon
are
'<
making exchange
Proceeds—Approximately<
$1,060,950 for redemption of class A preferred; balance
for expansion,
working capital, etc. Dividend rate and •
price by amendment. Offering temporarily postponed.
Fresh
Dry Foods, Inc., Columbia, S. C.
Aug. 30 filed 450,000 shares (100 par) common. Under¬
writer—Newkirk & Banks, Inc. Offering—Of the totalcompany is selling 350,000 shares and two
stockholders,!
Roland E. Fulmer and Louis H.
Newkirk, Jr., are selling
the remaining
100,000 shares.
Price—$6
a share. Proceeds
addi-i
development work!
Offering date indefinite.
-—For purchase of sweet
potatoes, plant expansion,
tional storage facilities, research and
; * -»
'11
~*v«;
**tvv,f
r\'
V;*.'
s
•
'*
•
'
-v
(letter of notification)
12,000 shares
Company and its subsidiaries.
Price—$20.50 a shdre.'
Proceeds—Estimated- proceeds of $1,210,000; after
($1 par)
'
,V,:-
'
,
*' ,Tj i'V'
,* ->
''-A
'
i
'
\ 1
'
■
'
'("•
v
Senses/ will be added to working capital.
V
t
Nov. 15 filed
ferred
160,000 shares ($25 par)
stock.
Underwriters—Auchincloss,
Parker
&
Price—By amend-
Redpath and Johnston, Lemon & Co.
ment.
Proceeds—Proceeds will be used to pay off a
$1,200,000 unsecured promissory note;* to exercise an
option
to
purchase
additional
preferred
and
and J. C.
standing
Graham, Jr., 100,000 shares of issued and
Prices, preferred $100
common.
$14
mon
share.
a
Proceeds—To
preferred, pay notes, discharge
porarily postponed.
1
retire
a
share;
$6
out¬
Company has asked the SEC to defer action on its fi¬
nancing program because of present market conditions.
com¬
cumulative
loan., Offering tem¬
a
Industrial Bancshares Corp., St. Louis, Mo;
-
Oct. 29 filed 100,00(1 shares of ($4
Gulf Atlantic
writing—None.
Transport'n Co., Jacksonville, Fla.
31
other
tract
into
entered
last
August
15.
Offering
date
mate dissolution.
.
program
Underwriter—Otis & Co.
and
to
increase
Kable Brothers
Nov. 0
its
General
St.
Engineering and Manufacturing Co..
outstanding
estimated
Louis, Mo.
dends.
Oct. 21 filed 50,000 shares
($10 par) 5% cumulative con¬
vertible preferred and
100,000 shares ($2 par) common.
6%
cumulative
preferred stock at an
cost of $213,258, exclusive of accrued' divi¬
It also
will
use
approximately $402,000 toward
the purchase of a manufacturing plant in Chicago; bal¬
ance for working capital.
Offering date indefinite.
■
"
To be offered to stockholders in ratio of one
common.
'/<
>,
No under¬
Price—$10 a share.
For expansion purposes.
k.1
K'/
will /receive/proceed*/
Co., Mount Morris, III.
share for each fiveheld.
Co., Chicago
Proceeds—Net proceeds will be used to redeem
ment.
^
(letter of notification) , 20,907 shares ($10 par)'
writing.
working capital, f Business*— I
work--
„
Offering—Price $10 per share.
Proceeds—Selling stockholders
Offering date indefinite.
.
Operation of specialty department store.
as
,
Aug. 28 filed 140,000 shares of common stock (par $1).'
in¬
Aug. 8 filed 80,000 shares ($1 par) common.
Under¬
writer: Paul H. Davies & Co., Chicago. Price
by amend¬
.
,.
_
International Dress Co., !nc., New York* :
stock
Instrument
Remaining funds will be used
ing capital.
definite.
Hammond
man¬
Price—$20
pany/the sum of $760,000 for payment of a/loan and'
$708,930 for retirement of Industrial's first and second
preferred stocks in order to prepare for the latter's ulti¬
con¬
a
will be sold in such
or
the board of directors shall determine.
share.
outstanding stock of the
pursuant to terms of
one
Proceeds—Of the proceeds, the company will
advance to Industrial Credit Corp., its sub-holding com¬
a
Corp., Pittsburgh, Pa.
Maurice Hoppin
and
stockholders
common
ner as
filed
ceeds—For purchase of all the
Under¬
be. offered^ for),:
will
stockholders in the ratio of
common
/share for eacli five shares held; i At the expiration of the*
subscription period, shares not sold may be purchased by/
indefinite.;
Gulf Oil
par)'common.
Offering—Shares
subscription to
Jan. 17 filed 270,000 shares of common stock
(par $1)/
Underwriters—Blair & Co.
Offering—Stock is being of¬
fered to present shareholders at $3
per share.
Holders
of approximately 200,000 shares have
agreed to waive
their preemptive rights. Offering date
man
shares of Brooks
Brothers, New York, increasing
Garfinckel's ownership of such stock to more than
99%;
to complete its present
building and store improvement
'
demption of 5% cumulative convertible preferred stock
not converted into common prior to the redemption'
date. The balance will be added to treasury fund*,
Benton Stores, Inc. and its affiliates from William Book¬
common
f~
:
pany's treasury for construction expenditures. Net pro¬
ceeds from the sale of common will be applied for re¬
Byllesby and Co., Inc.
Offering—Underwriters to
purchase from the company 18,500 shares of preferred
and 20,000 shares of common; and from Fred P.
Murphy
(50c par) common. Under¬
writers—E. F. Gillespie & Co., Inc., and Childs Jeffries
& Thorndike, Inc., New York.
Price, $4.50 a share. Pro¬
!
*2^
Hutton & Co. (jointly). Proceeds—Net proceeds from
thoj
sale of preferred will be Used'to reimburse the com-!
Oct. 23 filed 100,000 shares
convertible pre¬
»'*
M.
Oct,
& Co., Inc., Wash., D. C.
*
:
:
Underwriters—By competitive bidding. Probable bid-J
include Blyth & Co., Inc. and Mellon Securities
(jointly) and Morgan Stanley & Co. and W.:E.
shares
(Julius)
<
\
' i
ders
common stock at $16 a share at the ratio of
3%
shares for each preferred share held; and 120.000 shares of $1 par common stock.
Underwriters—H.
399,860 shares ($25 par) capitaL stock.;
($5 par) common.
Under- < Underwriter—The First Boston Corp., New York. Price
Price by amendment. Proceeds—
by amendment.
Proceeds—Shares are issued and out%
Shares are being sold by three
standing and are being sold by members of the Pitts-*
stockholders, including
J. G. White & Co.,
Inc., New York, which is selling all | burgh banking family of Mellon or trusts created'
by
of its holdings of such
stock.
Following the sale of its | members of the family.
holdings J. G. White will no longer be parent of Frontier.
Company will receive none of the proceeds.
Halliday Stores Corp., New York
Garfiixckel
>''**,»
''
<'
Corp.
writer by amendment.
•
r
pre¬
ferred stock and 966,870 shares (no par) common stock.
common
•/;V"*
i
Frontier Power Co.,
Trinidad, Colo*
'iiL
-'W
Illinois; Power Co., Decatur, III.
June 17, filed 200,000 shares ($50 par) cumulative
] /
{\
-r
-
i";r
shares of
offer to holders of Class A
preferred on share for share
basis plus a cash adjustment.
V ■'' ,,1
Household Finance Corp., Chicago
($100 par), with non-detachable common stock
purchase warrants entitling registered holders of shares
of the $4.25 preferred to purchase at
any time 64,750
100,000 shares of $1.25 cumulative con- /
vertible preferred stock
(par $25). Underwriter—Blyth
& Co., Inc. Offering—Underwriters
Oct. 25 filed 119,431
general funds. Offering date indefinite.
Oct. 29 filed 60,000 shares (no par) common.
Under¬
writing—None.
Offering—Stock will be offered for
Subscription to certain employees and officers of the
stock
Foster & Kleiser
Co., San Francisco
,/;;
to
Society, Inc., New York
July 29 filed 18,500 shares at $4.25 cumulative preferred
stock, all
Price by
July 29 filed
..
Offering—Company is selling the preferred
are selling the common shares.
Price—$25 a share of preferred. Price for the common
by amendment. Proceeds—Net proceeds will be addedr
shares and stockholders
Grolier
Offering date indefinite.
working capital.
& Co., Inc., New York
land, Ohio.
Underwriters—Kalman & Co,, Inc., St. Paul.^
Price—$25 a share. Proceeds — For improvement and
modernization program. Offering indefinitely postponed.
Temporarily postponed. /•/,
Underwriters—Cohu & Torrey.
amendment.
Tours, Inc., Boulder
■/;!:
common.
4
outstanding.
(Henry)
June 28,1946 filed 20,000 shares of 4%% ($25 liar) cuirtu.lative convertible preferred stock and
33,884 share*
($1 par) common stock. Underwriters—Otis & Co.,-Cleve¬
development and construction program.
Sept. 3
Proceeds—To be used to redeem 15-year
3%% sinking fund debentures, due 1959; and $2.50 cum- /
ulative preferred at $53 a share. Balance will be added
'/
Co., Tucson, Ariz.; J. Earle May &• Co., Palo Alto, Calif.,
Griggs, Cooper & Co., St. Paul, Minn.
amendment.
'/
account
no underwriting but Everett N.
Crosby, President and James Manoil, Treasurer, will act
selling agents. Price—$5 a share. Proceeds—For re¬
financing of company and for working capital and funds
Aug. 5 filed 60,000 shares ($15 par) cumulative preferred
stock.
Underwriters—Eastman, Dillon & Co. Price by
Foreman Fabrics Corp.* New
July 29 filed 110,000 shares ($1 par)
O'Neil
as
Stores, Inc., Philadelphia
working capital.
City, Nev.
119,500 shares of ($1 par)
share. No underwriting contract, how¬
a
of Buckley Bros.,, Los Angeles, will be sold by pnO or/
more of the following firms: Buckley Bros.; Durand &
are
writing—There will be
—
pansion and modernization program.
and
capital. Price, $3
ever, 55,000 shares to be issued to or through H. R.
Sept. 3 filed 500,000 shares ($5 par) capital stock. Under¬
1
common.
to
and being sold for the
Grand Canyon-Boulder Dam
;4/-v/:
t,
Oct. 16 (letter of notification)
-
Florida Telephone
Corp.,
'
"
,
Company has also issued 55,000
stock purchase warrants to the selling stockholders at
10 cents a share entitling them to purchase up to Aug. 1,
1949, common stock of the company at $11 a share. Price
by amendment. Offering temporarily postponed.
share; remaining proceeds, together with
Co., Indianapolis, Ind.
(letter of
Hollywood Colorfilm Corp., Burbank, Calif.
Offering—The 300,000 shares
issued and outstanding
8
notification) 27,331 shares ($1. par)
class A preference stock. Price, $10 a share. No under- %
writing. For additional working capital.
share
a
of certain stockholders.
2,010 shares ($100 par) preferred
other
Co., Toronto. Price—40 cents
Aug. 28 filed 355,000 shares ($1 par) common, of which
55,000 shares are reserved for issuance upon the exer¬
cise of stock purchase warrants.
Underwriter —Van
Underwriters—Herrick, Waddell & Co., Inc., New York.
Offering—To be offered
publicly at $8.10 a unit consisting of one share of class A
stock at $100 a
&
Glensder Textile Corp., New York
stock.
stock and one share of common
stock.
000 for retirement of
Herif Jones
Nov.
Funds). Proceeds—For mine development.
(Canadian
■
stock, of which
200,000 shares reserved for conversion of class A. Each
of
Daniels
Mark
Inc., New York
shares of
Mining Co. Ltd., Toronto, Can.
Oct. 2 filed 300,000 shares ($1 par) stock. Underwriter—
June 25, filed 100,000 shares
($5 par) class A stock and
300,000 shares (10 cent par) common
share
Thursday, November 21, 1946
}
•
•.
' v
i
s'
*
»
I
•
-
1
f
L
;
,
\
Kane County Title Co., Geneva,
,
t
•
A " *"
'
-
^
J
] ^
i
/
,
III.
Sept. 25 (letter of notification) 4,000 shares of commoiv
Offering—To be offered to stockholders of record Oct. 4
for subscription at $30 a share at the rate of one share
for each two shares held. Subscription rights terminate
Nov.
3. Any unsubscribed shares will
Chicago Title
Trust Co.,
&
a
be purchased by.
stockholder. No under-
,
writing. For expansion of building and plant facilities.
Underwriters—Dempsey, Tegeler
■
&
Co., St. Louis.
common
share.
& Co., and J. W. Brady
Price—$10 a preferred share and $5 a
Proceeds-^-Net proceeds, estimated at
to working capital and will be
used to finance the
company's new product, the "Gemco
space cooler (an air
conditioning unit)
I
and other
.
General Motors
Corp.,
Nov. 8 filed 1,000,000 shares
Detroit, Mich.
(11/27)
'
—
products, the principal field consisting of passenger
cars,'
vehicles, parts and accessories.
Industries
Power & Light Co.,
v..J/v ;
Kansas City/
Inc.,
and 100,000 shares ($100 par) cumulative pre¬
ferred.
Underwriting—To be determined by competitive
bidding.
and
receivables.
Additional
ment with the
Chase National Bank.
Milwaukee,
Hartfield Stores,
June
27
filed
100,000
capital
working
a
credit agree1
•
/
Inc., Los Angeles
shares
Wis.
ble
($1
par)
common
stock.
Underwriters—Van Alstyne, Noel &
Co.; New York, and
Johnston, Lemon & Co., Washington, D. C.
Offering—
To be offered to the public at $8 a share.
ProceedsCompany is selling 60,000 shares and stockholders are
selling 40,000 shares.
The company will use its proceeds
to pay the costs of opening additional stores and to ex¬
pand merchandise in its existing stores. Offering tem¬
porarily postponed.
July 31 filed 50,000 shares of $1.25 cumulative converti¬
/V;////'.//
•
Hayes Manufacturing Corp., Gr. Rap.lds, Mich.
Feb. 27 filed
185,000 shares of
common
stock
($2 par).
preferred stock series A ($20 par) and 150,000 shares
(10c par) common, all issued and outstanding and being
acquired by selling stockholders in exchange for 432,000
sold by
shares of
eight selling stockholders.
Alstyne Noel & Co.
Mo.
280,000 shares of capital stock. Under¬
writer—Smith, Barney & Co. Price by amendment. Pro¬
ceeds—Will be applied to the purchase and installation
of machinery and equipment and to the
carrying of in¬
(no par) preferred stock.
$590,000,000 of which $290,000,000 had been expended
through Sept. 30. Business
Manufacture of various
Glen
Kansas City
(12/2-6)
filed
is expected to be made available under
Underwriter—Morgan Stanley & Co., New York. Price—
By amendment. Proceeds—Company expects to use the
proceeds, together with other funds, to help finance its
expansion and modernization program estimated to cost
commercial
13
ventories
$893,000, will be added
corporate purposes.
Harman (William H.) Corp., Phila.
Nov.
Underwriters—Van
Price by amendment.
To selling stockholders.
Proceeds—
Offering temporarily postponed.
Shares
are
being sold by certain stockholders.
common
stock (par
Stock
$3) of American Engineer¬
ing Co. Underwriter—By amendment. Offering—Price by
amendment.
.
.
\
/
Nov/ 1
,
filed $36,000,000 of first mortgage bonds,' due
1976;
Probable bidders include Halsey, Stuart & Co.
(bonds only); The First Boston Corp. and Dillon,
Read & Co. Inc. (jointly); Central Republic Co. (stock),
and Smith/Barney & Co. (stock); Glore, Forgan & Co./
and W. C. Langley & Co. (stock). Offering—To the pub- /
lie. /Price-r-To be determined by competitive bidding.;
Proceeds—Proceeds will be used to redeem $38,000,000
Inc.
1966 apd 40,000 shares of first pre¬
of 3%% bonds, due
Business—Public utility. '
ferred stock; Series B.
•
-
Kingsport Press, Inc., New York
fund debentures, due'
($2.50 par) common.
Under-:
Sons, Baltimore, Md.
Price—
Nov. 14 filed*$l,200,000 of sinking
1961,
and
60,000 shares
writer—Alex.
Brown
ceeds
the
from
stockholders
tereci
will
&
Proceeds—Company will receive pro¬
By amendment.
sale
who
of
the- debentures,: and
common,
selling the common being regis-/
proceeds: from these shares.'- / The
are
receive
/ company
of its proceeds to .Tedeem*
cumulative preferred and,
$281,017 to prepay its note to The Equitable Life Assur-.
ance
Society of the United States.
Business—Book
manufacturer.
■
'/•'
//•/>• /' f //.///./•/.• .l;*"
5,500
will use-$577,500
shares of 5% prior
,
Volume 164
Number 4544
THE COMMERCIAL & FINANCIAL CHRONICLE
Leader'' Enterprises,; Inc., NewYork^} ^3 more than 98*2 per unit. : Underwriter—Boettcher and
Sept. 26 (letter of notification) 150,000 shares of (100
Co., Denver, and Hutchinson & Co., Pueblo, Colo. For
retirement of debt and for working capital.
-par) common and 57,000 shares ($5 par) 6% cumulative
•convertible preferred, Series A. Price—10 cents a com•
Mills Oil Co., Conrad, Mont.
mon
share and $5 a preferred share.
Underwriter—y
Nov. 13 (letter of notification) 100,000 shares of pre¬
Gearhart & Co., Inc., New York. Proceeds—To.
replace
working' capital used to promote pew publication called ferred. Price—$1 a share. Underwriters—David L. Mills,
Fashion Trades
Jr., Seminole, Tex.; and W. M. Fulton, Shelby, Mont. For
and' to provide
additional working
development of oil leases.
' •
"capital.'Offering date indefinite. >
;
;••. -<h •
2659
•-
New .York
N.
Macco Corp., Clearwater, Calif.
"Sept.- 23 filed 100,000 shares ($1 par)
Glore, Forgan &
(jointly) and Halsey, Stuart & Co. Inc. (bonds only).
proceeds of $28,000,000, together
with a $6,000,000 contribution from NY PA NJ Utilities
Co., parent, will be used for redemption of $13,000,000
of 3%% bonds, due 1964, and 120,000 shdres ($100 par)
5-10%, cumulative serial preferred and to finance new
•
August 19 (letter of notification) 14,000 shares ($10 par)
% common stock, offering price $20 a share. Underwriter—
Underwriter
Dean Witter & Co., Los Angeles. Price—
Clany M, Seay, Jackson, Miss, will undertake to obtain
By amendment. Proceeds — ■ To pay off outstanding
signatures authorizing subscriptions ; for the stock to
bank loans.
create 'capital and surplus for
operation of business.;
Coftipany is to be organized in Mississippi.
'
Mada Yellowknife Gold
capital
stock.
—
•
Mines, Ltd., Toronto
constructions.
'
Mountain
States
Offering—Stock will be offered publicly in the U. S. at
40c a share (Canadian
money).
Proceeds—Proceeds,
$75,000, will be used in operation of the
^company.
are
June 6 filed 140,614 shares of common stock
(no par).
Underwriters—To be determined by competitive
bidding.
Probable bidders include Blyth &
Co.,
.
on behalf of A; H.
Griffith, C. W. Mills, A. J. ChiSholm, Jr. and C..M. Spicer, all officers and directors of
J the company. Price—$1 a share. Underwriter—C, W.'
Mills, Denver. For equipment and working capital.
•
&
V
'
Indiana
Crosse, Wis.
par) common stock.
Offering—All shares
Co.
.•
Underwriters
f'
•.
Public
Aug. 28 filed maximum of
stock.
by
••
-v
..
Service
,
•.'Vv;
Co.
384,016 shares of
common
will be
offered under competitive bidding. Probable bidders in¬
amendment
as
shares
clude
Blyth & Co., Inc.; The First Boston Corp.; Stone
Securities Corp., and Harriman Ripley &
Co., Inc. (jointly),- Of the shares registered, 182,667 are
being sold by Midland Realization Co.; 54,426 by Mid¬
land Utilities Co., and 146,923 by Middle West Corp.
Sept. 4; but the
&
temporarily postponed.
Multi-Facet Diamond Corp., New York (11/25)
18 (letter of notification) 300 shares of class A
•
($2
Price—$16 a share.
Proceeds—To
Indefinitely postponed.
I';(* v..,;'*.!''•
Northern
by Standard Gas & Electric Co. and con¬
56.39% of / the "company's outstanding common.
Sale Postponed—Standard Gas & Electric
Co. asked for
bids for the purchase of the stock on
sale has been
shares
issued and outstanding and being sold for the account
i.V:• - C
stitute
each
70,000
of present holders.
owned
are
Madison Petroleum Co., Basin,, Wyo.
(letter of notification) 150,000 shares common
stock (par $1) on behalf of company and
25,000 Shares
■
.OcL 21
filed
selling stockholders.
Inc.; Kuhn, Loeb
& Co. and Smith Barney & Co.
(jointly); Harriman,
Ripley & Co.; The First Boston Corp. Offering—Shares,
estimated at
29
Underwriter—Cruttenden
Power Co.
—
*
"
»
Northern Engraving & Mfg. Co., La
Aug.
-
"June 7 filed 250,000 shares of
capital stock (par 40c).
'Underwriters
Names to be supplied by amendment.
1976,
Co.
Mississippi Fire, Casualty & Surety Corp.
"
Ithaca
Proceeds—Estimated
.
r
Corp.,
Oct 30 filed $13,000,000 first
mortgage bonds, due
.
„
Gas
150,000 shares of ($100 par) cumulative preferred.
Underwriters—To be determined by
competitive bidding.
Probable bidders include Blyth & Co. and
Smith, Barney
& Co. (jointly); First Boston Corp. and
•
Vi
Electric &
and
•
.
State
Y.
Nov.
Webster
stock.
Underwriter—J, Arthur Warner & Co., Boston.
Price, $500 pfer share. Proceeds for additional working
capital.
Maine Public Service Co., Prequo Isle, Me.
;
,
June
25.
filed
130,000 shares
^Underwriters—To
($10 par) capital stock.
determined through competitive
be
•shares
21 filed 85,000 shares
($1 par) common stock.
Underwriters—Newburger & Hano, and Kobbe, Gearhart
& Co., Inc.
Price, $6.75 a share.
Proceeds—Net pro¬
ceeds to the company from 62,000 shares, estimated at
$350,200, will be applied as follows: About $111,300 for
retirement of outstanding preferred stock; $41,649 to/
I purchase 100% of the stock of two affiliates, and bal¬
ance $197,000 for other corporate
purposes.
The pro1 ceeds frohi the other 3,000 shares will go to selling
stockholders. Offering temporarily postponed.
Murphy (G. C.) Co., McKeesport, Pa.
bidding.
Probable bidders include The First Boston
Corp.; Kidder, Peabody & Co., and Blyth & Co., Inc.
(jointly); Harriman Ripley & Co; Coffin & Burr and
Merrill Lynch, Pierce, Fenner & Beane. Proceeds—The
June 13 filed 250,000 shares of
common
Underwriter—Smith, Barney & Co.
stock (par $1).
amend¬
Price by
ment.
Proceeds—Redemption of outstanding 4%% preferred stock at $109 a share
plus dividends. Indefinitely
being sold by Consolidated Electric and Gas
Co., parent of Maine Public Service, in compliance with
geographic integration provisions of the Public Utility
•
Nugent's National Stores, Inc., New York
June
are
postponed.
Mutual
Holding Company Act.
Telephone Co., Honolulu, Hawaii
Oct. 28 filed
Max Factor & Co.,
-
•
?
t<remployees (latter shares not underwritten). Price by
ceeds, estimated at $1,485,610, will be used to repay
short-term bank loans and to finance plant replacements
and
improvements.
Business—Furnishing telephone
amendment.
$ ' Vf -Jfi
f
.
•
'
■
&S
\
)
-
•
1
.
'>
>,
'
v,
v
4,w
*
service.
•v„ .May McEwen Kaiser Co., Burlington, N, C.
"Aug. 22 filed 175,413 shares ($11 par) common stock.
Underwriters—Goldman, Sachs & Co., and Hemphill,
Noyes & Co. Price—By amendment. Proceeds—Net profb II shareholders who are selling the stock
'being registered. Offering temporarily postponed.
mon
ceeds go
and
Medisatt Corp., Philadelphia (11/25)
.Nov. 14 (letter of notification) 10,000 shares of common.
Offered on behalf of 11 stockholders.
Price—$4.50 a
share. Underwriter—Frank C. Moore &
Co., New York.
•Proceeds go to the selling stockholders.
•
Oct.
stock and 120,000 shares ($10 par)
•
common stock.
1972,
mon
com¬
;
preferred not issued in ex¬
change will be used to redeem $375,000 3^% serial deV.bentures, due 1951, at 101.2 and interest. It also will
redeem at 105 and accrued dividends all
unexchanged
shares of prior lien and preferred stocks,
new
v
,
,
3,
v
b
•
shares
Bidders
may
basis of 250
shares for
a
Under¬
work..
^
1
\
1
,
7
1
v
i
t
is selling
common
stock
are
vdthi
a
Bids
for
the
stock which
were
15 cents
•
:
Haven
Haven
Nov.
14
common.
;
were
of the
bonds
to be received
withdrawn Aug.
New
r
purchase
12.
(Conn.)
and
the
225,000 shares
are outstanding and are being sold by 10
stockholders, and 2,500 shares are being sold by A. L.
Marlman to all salaried employees. Indefinitely .post¬
poned.
*
,
•
(letter of notification)
a
/I
Board
Co.,
share.
increase cash working balance.
6,171
No
shares
($25
underwriting.
•
par)
August
5
To
:
.
-
^
16
Fibre
Corp.,
filed 4,000,000
Washington,
shares
Underwriting—Tellier
stock.
&
50 cents a share. Proceeds—The
(100 par)
Co.,
New
company
D.
Pro¬
/.
y
C.
preference
York.
will
use
Price
esti¬
mated net proceeds of $1,473,000 for purchase of a new
factory near Punta
'
.
Price—$1.50 a share. No underwriting.
to the selling stockholder. r
company.
Palmetto
New
i
-i
(letter of notification) 10,000 shares of common
behalf of Barnette E. Moses, a Vice-President of the
ceeds go
common
••',..
Price—$40
on
Sale postponed indefinitely.
&
Palmetex Corp., Pinellas Park, Fla.
Nov. 14
by the company Aug. 13
Pulp
Co., lite., New York
June 28, 1946 filed 227,500 shares ($1 par) capital stock.
Underwriters — F. Eberstad^ & Co., Inc.
Offering —
being offered in
recapitalization plan
compromise
'
|
t
Pat Blade
new common shares. The SEC has
extended to Nov.
30 time within which
refinancing may be carried but.
'
1
Sept. 19 filed 140,900 shares ($5 par) common. The
shares are being sold by three stockholders. Underwriter
r-The First Boston Corp.; New York. Price—By amend-
(stock only), First Boston
of
development
Middlekamp Building Corp., Pueblo, Colo.
;
Oct. 23 (letter of
notification) $95,000 4% first closed
mortgage sinking fund bo ids, due 1960,
Price—Not
'
ing price—To be supplied by amendment.
standing debentures; and preferred and common/stocks,
and for the issuance of $22,500,000 of bonds and
2,300,000
1,000 shares sold for
share. The underwriters
1,000,000 shares of
-
a share.
Proceeds—Of the total
37,500 shares and stockholders are
selling 87,500 shares. The company will use its proceeds
for equipment and working capital.:
other things
each. Proceeds—For exploration and mine
'
company
approved by the SEC, on June 24, 1946, which among
provides for the elimination of all out¬
Ltd., Toronto,
every
.the company. Price—60 cents
will receive a discount on the
*h \ - "•*«'
Offering—Price $4.75
Corp., White, Weld & Co.-Kidder, Peabody & Co. (jointly).
connection
Hale, East Aurora, N. Y. Offering—Of the
total company is selling $1,000,000 shares
and the re¬
maining 250,000 shares are being sold for the account of
the principal underwriter, brokers and
dealers, which
shares they will receive as additional
compensation on
the
^
iCo.; Chicago
Orange-Crush de Cuba, S. A., Havana, Cuba
($5 par).
Underwriters—By amendment.
include Halsey, Stuart & Co. Inc. (bonds
Offering—Bonds and
writer—R. J.
.
\ vi; ' §**
July 22 filed 125,000 shares ($1 par) common and 40,000
warrants.
Underwriter—Floyd D. Cerf Co., Inc., Chicago.
Mining Co., Spokane, Wash.
only), Bear, Stearns & Co.
.
common.
"j-*
ment
notification) 110,009 shares of common. s
share.
No underwriting.
To develop
•
Oct. 21 filed 1,250,000 shares
($1 par)
^
'i T
■
,
Midas Yellowknife Gold Mines
'Canada
1
'
•
selling 40,000 shares,
Net proceeds from sale of
„
'v
<
—Michigan will use net proceeds from bonds to redeem
$3,500,000 3%% series A first mortgage bonds, due
and from shares of
ft
Pacific Power & Light Co., Portland, Ore.
Middle West is selling 57,226 shares and
Halsey, Stuart
Co. Inc., New York, is
selling 22,774 shares.
Proceeds
106.75 and interest.
i
July 10 filed 100,000 shares ($100 par) preferred stock.
Aug. 2 filed 30,000 shares of 6 % cumulative convertible\ Underwriters—By amendment. Probable bidders include
preferred (par $10), and 30,000 common shares ($1 par). I: Blyth & Co., Inc., White, Weld & Co. and Smith, Barney &
Underwriters—Names by amendment. Offering—Shares
Co. (jointly); The First Boston Corp., W. C. Langley & Co.;
.are
issued,, and outstanding and are being sold by 2 Harriman Ripley & Co. Offering—Company proposes to
Maurice .Cohen
and
Samuel
issue the 100,000 shares of new preferred for the pur¬
Friedman,
President
and Secretary-Treasurer,
respectively/ each selling 15 000
pose of refinancing at a lower dividend rate the 67,009
shares of preferred and 15,000 shares of common. Price
outstanding preferred shares of Pacific and the 47,800
—$10 a share for the preferred and $6 a share for the
preferred shares of Northern Electric Co., in connection
common.
with the proposed merger of Northwestern into Pacific.
In connection with the merger, the outstanding preferred
New England Gas and Electric Association
stocks of Pacific apd Northwestern will be exchanged
July 11 filed $22,500,000 20-year collateral trust sinking
share for share, with cash adjustments, for the new pre¬
fund Series A bonds, and a maximum of
1,568,980 com¬
ferred stock of Pacific, the surviving corporation. Offer¬
be
company is
a
'
To
^
1
Nevada Stewart
r..
..
by
Newburgh Steel Co., Inc., Detroit
Un¬
a
mon
V,C
i: i'
*
(letter Of notification) 50,000 shares ($1 par)
Offering to stockholders for subscription at the
Price—14%c
Offering—New preferred will,be offered
share for share exchange basis to holders of
its
outstanding 7% prior lien, $6 no-par prior lien, 6%
preferred and $6 (no par) preferred.
Of the common
at
t
v
^
sold
being
Old Town Ribbon & Carbon Co; Inc., Brooklyn v
mining claims.
yHaupt & Co,
I
<}
14,000 are
Price—By amendment;: Of¬
■
r
Nov. 13 (letter of
determined by competitive
bidding.
Probable bidders include Blyth & Co., Inc.; Kidder, Peabody & Co.; The First Boston Corp.; Harris, Hall & Co.
-(Inc.); Merrill Lynch, Pierce, Fenner & Beane, and Ira
stock being registered,
amend¬
company may employ
t
,
ij''i
Corp.
(letter of notification) 60,000 shares of capital
be offered for subscription at $3 a share to
stockholders. Unsubscribed shares will be sold to officers,
directors and employees. Proceeds will be used as addi¬
tional capital.
;
working
Michigan Gas & Elec. Co., Ashland, Wis.
'on
'<'i
remaining
7
stock.
capital.
June 24 filed $3,500,000 of series A first
mortgage bonds,
.due 1976; 14,000 shares ($100 par) cumulative
preferred
•
Nov.
share for each V-k shares held.
Price—By:
amendment. No underwriting. -For additional
individuals to promote the sale of the stock.
Price;
derwriters—To
7
rate of
$100 per share. Purpose, working capital,
;
Aluminate Corp., Chicago
.
Oct. 21 (letter of notification)
2,877Vz shares 7% cumu¬
lative and participating preferred stock
(par $100), Unsome
!" }
1
the
fering indefinitely postponed.
National Tile & Mfg. Co., Anderson, Ind.
stock.
and
Securities, New York. Offering—
registered, 21,000 are being sold by the
General Telephone
selling
stockholders and the number of shares to be sold by each
will be supplied by amendment.
'►
shares
company
an unspecified number ($2.50 par) com¬
shares. Underwriters—First Boston Corp., New
York,
Lee Higginson Corp., Chicago.
n*""'
Merchants Factors Corp., New York
derwriter—None at present but
Of the
Old Republic Credit Life Insurance
Price—By
.
Underwriters—Paine, Webber, Jackson & Curtis
and Stone & Webster
ment. Proceeds1—1The stock is issued and
outstanding and
is being sold by shareholders. Names of the
.•
Telephone Co.
11 filed 35,000 shares (no par) $2 cumulative pre¬
ferred.
"Sept. 27 filed
'
;
8 Sept.
.v.
National
"
•
Ohio Associated
common
stockholders at $10i a share in the ratio of one
share for each four shares held of record on Nov. 1.
Unsubscribed shares will be sold at public auction to
the highest bidder. Price—$10 a share. Proceeds—Pro¬
\
'
150,000 shares ($10 par) common stock.
Underwriting — Noiie.
Offering —For subscription to
Hollywood, Calif.
Oct. 25 filed 600,000 shares ($1
par) - common.
Underwriter—Goldman, Sachs & Co., New York. OfferingShares are being sold by stockholders.
Of the total,
550,000 will be sold to the public and 50,000 will be sold
•
Gorda, Florida, at
a
cost of about;
♦
.
(Continued on page 2660)
.
,
THE COMMERCIAL & FINANCIAL CHRONICLE
2660
'i
(Continued from page 2659)
: -..J.
ft Proceeds for additional operating capital because of
pansion of normal,business.
-
.
$951,928; It will set aside $150,000 for research and development purposes and the balance will be used as
capital.
operating
"
)
'
•
v
Pantasote
Plastics
Inc., Passaic, N. J.
ftg
company.
tion and
Sept. 27 filed 60,000 shares ($25 par) 4y2% cumulative
preferred and 1,352,677 shares ($1 par) common. Under¬
writer—Underwriting arrangements will be supplied by
but it is contemplated that Van Alstyne,/
York, may be one of the underwriters. |
Offering—Company is making an exchange offer to
stockholders of Textileather Corp., Toledo,
O.; The
Proceeds—Estimated net proceeds of
loan from thg Marine
Proceeds to the
'
:
V
«
-
1
ft;
'
Reliance Electric &
ft/ft":
ft
-
//
ft/ftft"
ft
Realmont Red Lake
Gold Mines,
„
.
,
>
...
.
■
.
Sept. 3 filed 600,000 shares of common (par $1). UnderHughes, Ltd., Toronto, Canada. Price—
Proceeds—Net proceeds will be used to
'
writer—Sabiston
60 cents a share.
purchase, drilling
machinery
other
and
Pharis Tire & Rubber Co.,
equipment.
Newark, O.
Sept. 27 filed 100,000 shares ($20 par) cumulative con¬
preferred. Underwriter—Van Alstyne, Noel &
Co. and G. L. Ohrstrom & Co., New York. Price—$20 a
share. Proceeds—For payment of loans and to replace
vertible
*
•
Nov. 20 filed
Offering
Louisville, Ky.
•
60,000 shares of
Price—$10
stock ($2.50 par).
Underwriter—Bankers
common
share.
a
ft'ft ,/ft
ft ft;,;,/
"
;
-ft'
'
ft/;///.ft/ft',ft' / ...■'//. ft-,' .-ft ftft.
ft ft--.-/'
Republic Aviation Corp.,
Oct. 9
filed
ferred stock.
Farmingdale,
Houston, Texas
(45c par) Class A common
and 35,441 shares (45c par) Class B common.
Under¬
writing—The underwriters who are also the selling
stockholders are Dempsey-Tegeler Co., St, Louis, Mo.;
Dittmar & Co., San Antonio, Tex.; Stifel, Nicolaus &
Co., Inc., St. Louis, Mo.; and Rauscher, Pierce & Co.,
Inc., Dallas, Tex. Price by amendment.
7-Up Texas Corp.,
Y.
100,000 shares ($50 par) convertible pre¬
Underwriters—Hayden, Stone & Co., arid
Kidder, Peabody & Co.
Price—By amendment. Pro¬
ceeds—Proceeds, together with bank loans, will be used
to increase working capital.
Such funds are deemed
necessary in view of the additional facilities that com¬
pany intends to acquire and its large backlog of peace¬
(12/3-10)
Nov. 4 filed $30,000,000
of first and refunding mortgage
bonds, due 1981, and 300,000 shares ($100 par) preferred
stock.
Underwriters—To be determined by competitive
Shatterproof Glass Corp., Detroit,
.
,
*.
y-ftftft'fty
ft
'
ftft-ft,
Republic Drill & Tool Co., Chicago
bidding.
Probable bidders include The First Boston
Nov. 4 (letter of notification) 60,000 shares ($5 par) prior
Corp.; Halsey, Stuart & Co. (bonds only); Morgan Stanlej' & Co.; W. C. Langley & Co., and Glore, Forgan &
preferred stock.
Price—$5 a share. No underwriting.
Co. (jointly), and White,Weld & Co. (bonds only).Offer¬
A portion of the stock will be issued as part payment
ing—To the public. Price to be determined by competi¬
to employees under the company's profit sharing plan
tive bidding.
Proceeds—Proceeds of about $60,000,000
and to suppliers impart payment of their invoices.; For
before deducting expenses will be used to pay off $18,- £ new machinery and equipment and for working capital;
000,000 of IV2% promissory notes and to finance part of
the company's construction program which will require
Republic Pictures Corp., New York
approximately $42,000,000. Bids: Invited—Bids on the
Registration originally filed July 31 covered 184,821
bonds will be opened Decw 10 and bids on the preferred
shares of $1 cumulative convertible preferred ($10 par)
stock will be opened Dec. 3.
and 277,231 shares (50c par) common stock, with Sterling,
ft
.-'v «.*/. X*'
'"*>*'
-f'
n'
s>'b
Grace & Co. as underwriters.
Company has decided to
Phillips & Benjamin Co., Waterbury, Conn.
issue 454,465 shares of common stock only, which will be
Sept. 23 (letter of notification) 14,164 shares of $5 par
offered for subscription to stockholders of record Sept.
common.
Offering—To be offered for subscription to
5 to the extent of one share for each five held. Issue will
present stockholders on the basis of one share for each
not be underwritten.
share held. Price not disclosed although it is stated that
Solar
.
'
».
■
J
v
shares of $1.12% cumulative con¬
preferred stock, series A (par $20).
Under¬
writers—Van Alstyne, Noel & Co.
Price by amendment.
Proceeds—Net proceeds will be applied for the redemp¬
tion of outstanding series A convertible preferred stock
which are not converted into common stock. ; Such pro¬
ceeds also will be used for additional manufacturing
facilities in the amount of $600,000; for additional inven¬
vertible
wishes to have available 6,000 shares to take
options which it proposes to give to manage-
company
care
of
\% ment for past services, the options to
of two years and six
may
run over a
•
share. No underwriting.
price.
postponed.
Reynolds Pen Co., Chicago
May 4 filed 400,000 shares of common stock (no par),
Plastic Molded Arts, Inc., New York
of which 100,000 shares are being sold by company and
Aug. 27 filed 60,000 shares of preferred stock ($10 par)
300,000
by
stockholders.
Underwriters—Names
by
and 75,000 shares of common (par 5Qc).,
amendment. Offering—Terms by amendment. Proceeds
Underwriter—
Herrick, Waddell & Co., Inc.
Offering—CompEiny*A$l —Net proce^ds^ttf the cbmpahy/wilfcbe added to working
offering the preferred stock to the public, while the i capital.'
cAwmnn
Rowe Corp.,
a share; common, $4 a share.
Proceeds—
Proceeds from sale of preferred will be used to purchase
equipment,
pay
Precision
Steep Rock Iron Mines
Co.
of Ann
Ltd., Ontario
Underwriters—Otis & Co.
amendment.
capital stock (par $1).
Offering—Price to public by
Proceeds—Net proceeds will be added to
the general funds and will be available for
corporate purposes. Offering date indefinite.
ft
Stereo
Pictures Corp.,
general
,
New York
July 29 filed 100.000 shares common stock. Underwriters
Oct. 14 (leter of notification) 2.985 units of stock, erich
—Hayden, Stone & Co. Offering—The selling stockhold¬
unit consisting of one share of $6 cumulative (no par)
ers, who include Robert Z. Greene, President, are offer¬ ft
non-voting, non-convertible, preferred stock and one
ing the shares to the public through the underwriters,
share of common stock (par 50c). Underwriter—Ayres
for their own account.
Price, by amendment. Offering
Barley & Associates, Inc., (165 Broadway, Suite 1717)
bank loans, and other corporate purposes.
Parts
New York
ft
March 27 filed 500.000 shares of
is being sold by certain stockholders.' Prices-
Preferred, $10
underwriters at same
Price — Public offering price of unsubscribed
shares by amendment. Proceeds—For expansion of plant
facilities and for additional working capital. Offering
'
ft
For exploitation of its
business.
*
unsubscribed shares will be sold to
common
months and provide that the stock
Co., Detroit, Mich.
($25 par) 5% cumulative con¬
vertible preferred/ Underwriter—Ames, Emerich & Co.,
Inc., Chicago. Offering—To be offered to common stock¬
holders for subscription at $25 a share in the ratio of
one preferred share for each five shares of common held
Mining Co., Carson City, Nev.
(letter of notification) 295,000 shares ($1 par)
and 59,000 warrants.
Prices—$1 a common
share and 50 a warrant.
No underwriting. 'For explo¬
ration and development work.
ft-vv1'' ■'
period
be purchased at $10 a share within 18 months and,
and before the expiration of the option, at
a
Rex
Soss Manufacturing
working
Sept 3 filed 40,000 shares
Nov. 14
thereafter
$15
tory amounting to $400,000, and for additional
capital. Offering temporarily postponed.
>.>
r<'
Manufacturing Corp.
June 14 filed 80,000
4
ft
Mich.
shares ($1 par) common. Under¬
writing—None.
To be sold through brokers on overthe-counter market.
Offering—The shares are issued
and outstanding and are being sold by William .B. Chase,
President, and members of his family or trusts create^
by Chase or his wife. Price—At market.
Oct. 28 filed 280,000
time business.
.
14
Oct. 28 filed 71,141 shares
i y ft;
N.
Cleveland, Ohio
(letter of notification) 1,000 shares ($100 par)
preferred and $5,000 (no par) common.
Prices—$100
and $20 a share, respectively.
No underwriting. To in¬
crease capital.
tion.
ft;.,//.;.: y/
Selected Brands, Inc.,
Nov.
Bond Co., and Almstedt Bros., both of Louisville, and
Cruttenden & Co., Chicago.
Of the total of 60,000 shares,
? the company is selling 40,000 and seven stockholders are
disposing of the remaining 20,000. Proceeds—Company
will use its proceeds, together with $500,000 bank loan,
to finance paints and varnish plant now under construc¬
Philadelphia Electric Co., Philadelphia, Pa.
1
Reliance Varnish Co.,
■
working capital expended in purchase of building from
RFC and to complete construction of a building.
*
($1 par).
Company has
underwriting contract. ProceedsDevelopment of mining properties and exploration work.
,
Seaboard Finance Co., Washington, D. C.
of $1.50 cumu¬
sold to certain
individuals, insurance companies and employees and
200,000 shares of common stock (par $1), of which
100,000 shares will be offered to employees, subsidiaries
and affiliated companies and 100,000 shares are being
sold by Industrial Acceptance Corp., Ltd., acquired by it
in exchange for stock of Campbell Finance Corp., Ltd.
Underwriters—Van
Alstyne, Noel & Co.; Johnston,
Lemon & Co., and Crowell, Weeden & Co. for common.
Preferred not underwritten. Price by amendment.
ft
not entered into any
•
The company also
selling 200,000 stock purchase warrants to executives
Nov*. 14 by amendment filed 50,000 shares
lative series A preferred (no par), to be
Ltd., Toronto,
Offering Price—$0.60 a share to public.
Montreal, Canada
Peninsular Oil Corp., Ltd.,
}'''V"'
postponed indefinitely.
Nov. 20 filed 800,000 shares of common stock
Company will exchange
;
x'
ft'
Engineering Co., Cleveland
■
•
150,000 shares ($1 par)
14,500
shares for outstanding preferred and $135,000 shares will
be sold.
Price—-$2 a share. No underwriting. For payi ment of debt and working capital.
V,
of the company at 50 cents a warrant.
Company , will
use its proceeds for general corporate purposes.
Offering
of notification) maximum of 17,500 shares
($5 par) common.
To be sold to certain employees at
price based on market price. No underwriting. To be
added to working capital.
Co., Chester, Pa.
(letter of notification)
M
officers and directors at $5 a share.
is
Nov. 14 (letter
will be applied to make loans to Textileather
corporate purposes.
Class A common.
ft
that 24,000 of the 244,000 shares of common are
being reserved for a period of four days following the
effective date of the registration for sale to employees,
Canada
Oct. 30
j
Inc., Atlanta, Ga,
Price of preferred $10.75 per share; price of com¬
$5,625 per share. Proceeds—Company jfs selling
the 25,000 shares of preferred to the underwriters at
$10 a share and stockholders are selling 244,000 shares
to the underwriters at $5 a share.
The registration
Oct. 11 filed 120,300 shares
•
and Pantasote for various
10c
'ft.1*
25,000 shares.
lanta.
indefinite.
y
and the balance (which are part of the shares to be
received under the exchange offer) are to be purchased ft
*
,
owns
company
will be used to restore working
mon,
Proceeds—The shares are being sold
by stockholders who will receive proceeds. Offering date
pany
Pedlow Machine
the
Aug. 7 filed 25,000 shares ($10 par) 5% cumul. converti¬
ble preferred stock and 244,000 shares ($1 par) common
stock. Underwriters—Clement A. Evans & Co., Inc., At-*
Co., Bridgeport, Conn.
(D. M.)
stock
'/ft ''
v.
Scripto,
—By amendment.
preferred and 250,000 shares of common," of which
12,853 shares of preferred and 50,000 shares of common
are to be purchased by the underwriters from the com¬
—
J
t
Business-
6f common stock (par $2.50),
ft Underwriter—Tucker, Anthony & Co., New York. Price
of
Proceeds
Proceeds—For explora¬
common
The balance of proceeds
stated
•;
shares of its common for
•ft each shares of Astra common. It is proposed that under¬
writers will offer publicly a maximum of 60,000 shares
company
capital stock,
Montreal, director Of
Reed-Prentice Corp., Worcester, Mass.
plus % of a share of pre¬
12
from selling stockholders.
share.
a
whose
(500 par)
$476,362 will be used to pay off a
Midland Trust Co., New York.
ferred, for each share of Textileather common. It will
offer
two
shares, of
its
common
for one
share; of
and
shares
B. / Soden,
Price—50^
amendment.
By
Co., Passaic, N. J.; and Astra Realty Co., New
York, for the purpose of acquiring the controlling interests of the companies. Pantasote Plastics will offer
common,
In
Sept. 27 filed 100,000 shares (250 par) common. Under*
writer—Van Alstyne, Noel & Co., New York. Price-
Pantasote
Pantasote
100,000
development of mining property.
Read
amendment,
three shares of its common,
"
.
Developing mining properties.
Noel & Co., New
:
filed
13
Underwriter—Robert
at $52.50 a share plus accrued dividends.
addition, the company will apply $2,675,000 of the
proceeds as advances to Alabama Pulp and Paper Co., Of
ex¬ ;/ redeemable
Quebec Gold Rocks Exploration Ltd., Montreal
Nov.
>
194$
Thursday, November 21,
Arbor, Mich.
July 5 filed 75,000 shares 5%: cumulative convertible
date indefinite
ft
New York. Price — $100 per unit. Proceeds—for working
preferred stock ($10 par).
Underwriter—Van Alstyne,
;
r./ft;//;
Noel & Co. and associates.
Price by amendment.
Procapital, machinery, equipment, etc.
ft/
ft
Rosslyn Loan Co., Inc., Arlington, Va.
'ceeds—Of the net proceeds, $250,000 will be used to pay
Nov. 12 (letter of notification) 20,000 shares ($10 par);
Stix, Baer & Fuller Co., St. Loufs
.3% notes held by National Bank of Detroit, $75,000 to
reimburse treasury for sums spent in acquisition of the ft 6% preferred and 10,000 shares ($1 par) common. Prices
Aug. 28 filed 102,759 shares common stock (par $5).
—$10 a preferred share and $5 a common share.
No
Underwriter—Goldman, Sachs & Co;
Offering—Eight
electrical division plant of the company, $30,000 for con¬
underwriting. To conduct business of company/ ft
ft
struction of space for executive offices in the economy
selling stockholders are disposing of 62,000 shares, and
baler plant, and the balance will be deposited with gen¬
ft the company will offer 40,759 shares initially to its pre¬
/
St. Regis Paper Co., New York
eral funds. Offering temporarily postponed.
ferred and common stockholders. Price by amendmentProceeds—Net proceeds from the sale of the company's
Sept. 27 filed 150,000 shares ($100 par) first preferred,
;Public Finance Service, Inc., Phila.
(12/1)
shares will be added to its "building construction and
ft Underwriter—To be supplied by amendment. Probable
Nov. 19 (letter of notification) $250,000 6% cumulative
/debentures, being balance of debentures authorized un¬
der agreement between company and National Bank of
Germantown & Trust Co., Philadelphia, trustee, dated
r
*■
Dec.
1, 1942 of which only $1,200,000
retirement
were
issued in/a
program/Price, $100. No underwriter named.
•
underwriter,
White,
Weld
&
Co.
Offering—Terms
of
offering and price by amendment. Proceeds—Net pro¬
ceeds will be used to redeem company's 5% cumulative
-.prior-preferred stocks and an unspecified amount will be
-advanced tri Taggart Corp., a subsidiary, for redemption
of
its
si***,
$2.50
,
cumulative » preferred. Both securities are
! improvement fund." Offering date indefinite.
ft;: Stone
•/•//vft.ft
1
Underft
; writer — Ho.rnblower & Weeks, Chicago. Offering —Of
the total, company is selling 200,000 shares and stock=
Container Corp., Chicago
Oct. 24 filed 300,000 shares of
($1 par) common.
.'
'
1V'.".
;;:vV: V
I
..
Volume
164
-
Number 4544
„
'
.'"i""
'■■/
•
"V.--.
•'
'..'iif
'-f
'".■■■■■- A':■
•A'-.'" S
•">.?.
• '•
' '
'
I
'
':■/
"■".
1
-
1
.■
THE COMMERCIAL & FINANCIAL CHRONICLE
•
-holders
are selling the remaining 100,000 shares.
Price
by amendment. Proceeds—Of net proceeds, company will
use $1,225,000, plus a premium of $12,250, together With
accrued interest, for payment of a bank loan,.'and $493,-
Union
Telephone Co., Blair, Neb.
Nov-20 <Xletter
ment
mortgage 20-year 3y*%
bonds
due
1966, at 103.75 per
unit.
Underwriter—Wachob Bender Corp.
Proceeds—
For retirement of outstanding 3%% bonds.
500, together with accrued interest, for discharge of its
*
Street & Smith
•
J
.
%
/* j
•*
.
Publications, Inc.
writing
Swern &
filed
28
Co., Trenton, N. J.
195,000
shares
S|;
common
Underwriter—C. K. Pistell & Co., Inc.
stock
(par
Nov.
Offering—Com¬
6%
is selling 45,000 shares,-and eight selling stock¬
holders are disposing of the remaining 150,000 shares.
Proceeds—From 45,000 shares
Price—$10.50 a share.
sold by company will be applied to working capital
:
'*
>,
/'*
\
:<>
Offering date indefinite.
rjy,/ [ -J.
f
■'/
r,
(j
/v
\*t
\«*
July 12 (letter of notification) 44,300 shares of ($5 par)
share for
common.
July 24 filed 203,500 shares of stock which
•
derwriter—None
of increasing
purpose
the
Toledo
(O.)
issuer's
equity
Inc.
in
for
mortgage bonds, due 1976,
($100 par) cumulative preferred.
Underwriters—To be determined by competitive bidding.
Probable bidders include The First Boston Corp.; Halsey,
JStuart & Co. Inc. (bonds only); Blyth & Co., Inc.; and
V Smith, Barney & Co. Price to be determined by competi¬
tive bidding. Proceeds—Net proceeds together with $4,500,000 bank loan and if necessary, the $5,000,000 to be
contributed by its parent, Cities Service Co., will be used
to redeem outstanding debt and preferred stock, involv¬
ing
160,000 shares of
a
share and accrued dividends.
The
added to general corporate funds.
•
payment of $53,906,590, exclusive of interest and
•
Wentink
will
Toro
Manufacturing Corp. of Minnesota, Minn.
(letter • of notification) 23,375 common shares
Price, $12.50 ai share. No underwriting. For general work¬
ing funds.
8.
•
West Coast
Unexcelled Chemical Corp., New ^ork (11/27)
Nov. 15 (letter of notification) 37,214 shares ($5 par)
capital stock. Price—$8 a share. No underwriting. For
Sept. 2 filed 245,000
writer
shares
($1 par)
common.
Under¬
Auchincloss, Parker & Redpath, Washington,
D. C. Pricch-$7 a share. Proceeds—Will be used for
pay¬
reduction of bank loan.
For capital investment and purchasing
\
Winter &
;
Probable bidders include Merrill
Lynch,
Pierce, Fenner & Beane; White, Weld & Co.; Glore,
Forgan & Co., and Harriman Ripley & Co. (jointly);
The Wisconsin Co., and Dillon, Read & Co.
Proceeds-
Part of the shares are to be sold by Middle West
Corp.,
top holding company of the System, and part- by prefstockholders of North West'Utilities5Co.," parent'
Wisconsin, who elect to sell such shares of Wisconsin
erence
of
which
common
dissolution of
—
will
be
North
distributed
i-ui'•«*-.*'*>•*
i
l; -4
,'-V' :
''
:
•
.'->■•*(
••
•'■••*■;V V
\
\
.•';
'A;- •
v5-; ''v
r,
;r
•.
■
»"/•,'•** j;;
'! '•
ii '■
;y
•
>;■ t:rv\
;
j
Wyait Fruit Stores, Dallas, Texas
(par $100) preferred stock.
Underwriter—Rauscher, Pierce & Co. Proceeds—Will be
used in part to equip, three new
cafeterias, to remodel its
super markets and to increase working capital.
,
Zatso Food Corp., Philadelphia
18 (letter of notification) $100,000 5% cumulative
preferred stock (par $100) with common stock as bonus.
Oct.
Price, $100
for
per
general
unit. For purchase of raw materials and
of business. Underwriter—Ludolf
conduct
Schroeder, 1614 Cambridge St., Philadelphia.
-
.
.
State, Municipal and
Corporate Securities
PHILADELPHIA
/
:
restoration of railroad credit by means of higher
:
rates, Roy B. White, President, stated at the
annual meeting. Mr. White stated that "the
capital struc¬
ture
of
:
CHICAQO
PITTSBURQH
19, refunding the road's high interest bonds hinges
freight
....
NEW YORK
BUFFALO
). CLEVELAND
BT. LOUIS
V''i'
■
in
t*:*.1/:.»
'
'
<
,
'
•
'•
i-
♦
expenses
due to increases
cost of supplies, so that railroad v
to the point where our highqr
interest-rated bonds can be refunded < at lower interest •
wages,
credit
•
Nov.
v
IliiBiiLi R&-CO,
/ V
*••«
will
taxes and
be
restored
Baltimore & Ohio RR.
upon
BOSTON
'
rates."
•
INC.
:7(V; *
heavy "increases in operating
,
14
reported considering sale of $25,000^000 bonds
in December with Morgan
Stanley & Co. as principal
underwriters.
.*
United States Government,
's
Security Offerings
Australia, Commonwealth of
Nov.
\;.
x'V.
(Only '^prospectives" reported during tbe past week are
given herewith. Items previously noted are not
repeated)
•
the
upon
■J/ Nov.. 12 filed 5,000 shares
(NOT YET IN REGISTRATION)
INDICATES ADDITIONS SINCE PREVIOUS ISSUE
•
V:; ''
them
to
West Utilities Co.
-1"
Pr ospective
wholly-owned sub¬
amendment.
•
operation of business.
your
company
has
been
revamped
under
ouj*
adjustment plan so as to put it on a sound (basis by
extending maturities, placing part of the interest on a
contingent basis and removing legal obstacles to the
"Big" and "Little Inch" Pipelines
Washington that War Assets Ad¬
16 bids submitted for .the
purchase of the pipelines constructed during the . wai
by the government at a cost of $145,000,000. ;
Nov. 19 reported from
ministration had rejected all
•
Capital Transit Co., Washington, D. C.
Dec.
11
refunding of
progress,
;
our
high
interest-rated
however, is dependent
reasonable rates
to
the
carriers
upon
bonds, f Further
the granting of
by the ICC :to
offset
Electric Co.'s
proposes
:
Washington Ry. & ' :
dissolution plan which, among ether things, -
SEC will hold
.
.
-r
■
Wisconsin Power & Light Co.,
Madison, Wis.
May 21 filed 550,000 shares ($10 par) common stock to
be
sold
at
competitive
bidding.
Underwriters—By
be
Airlines, Inc., Seattle, Wash.
7,;
•
Hirsch, Inc., Chicago
Nov. 13 (letter of notification) 10,000 shares
($20 par)
7% cumulative preferred.'Price—$20 a share. No under¬
writing.
For expansion of business, and reduction in;
bank borrowing requirements.
and
too^s and machinery and for
>
a
supplies.
-
25,000 shares ($10 par)
35,000 shares (no par)
common.
Prices—$10 a preferred share and $1 a com¬
mon share.
No underwriting.
For purchase or con¬
struction of manufacturing building, purchase of
equip¬
ment,
preferred
^.-*7
••
/Wiley Mineralized Soil Products, Inc., Leesburg,'
| underwriting.
Industries, Inc.* Grand Rapids, Mich.
cumulative
6%
,
f
Nov. 12 (letter of notification) 500 shares of 6% cumula¬
tive preferred ($100
par).
Price—$100 a share.
No*
Nov. 13. (letter of notification)
dividends,
Nov.
to be sold
balance
.
.
will be used to provide funds for
Webster Electric Co., Racine, Wis.
Sept; 3 filed an unspecified number of shares of com¬
mon stock (par $1).
Underwriting—Loewi & Co., Mil ^
waukee.
Offering—The shares are being sold both by
the i company and by shareholders.
The respective
amounts will be supplied by amendment.
Price by.
amendment.
Proceeds—Company will use about $210,000 of its net proceeds to redeem 645 shares of its prior
preference stock at $110 a share and accrued dividends,
and 1,386 shares of second preference stock at $100 a
Edison Co.
.
5./
sidiary, retire loans from banks and from White's Em¬
ployees Profit Sharing Trust, and for additional working
capital. Offering date indefinite.
Textron
public offering of the shares.
,
offering 75,000 shares of preferred; the 50,000 shares
common are outstanding and
being sold by four in¬
own account.
Price by amendment.
Proceeds—Proceeds from the sale of the preferred stock
($1 par) capital stock. Un¬
Price—25 cents a share. Pro¬
yet.
VJ
•
sv
dividuals for their
ceeds—For developing mining property.
BusinessAcquiring and developing mining properties,
the
Oct. 25 filed $32,000,000 first
and
as
Price-
common,
is
Underwriters—
Victory Gold Mines Ltd./Montreal, Canada:
Co.
&
par)
of
Sherck, Richter & Co., and Straus & Blosser. ^ Offering—
Of the total, 200,000 shares will be sold through the
underwriting group at $8.50 a share, and 3,500 shares
will be offered to certain employees at $7.50 a share.
Offering postponed indefinitely.
con¬
Minton
con¬
($1
White's Auto Stores, Inc.
Aug. 29 filed 75,000 shares $1 cumulative convertible
preferred stock ($20 par) and 50,000 shares common
stock (par $1).
Underwriters—First Colony Corp. and
Childs, Jeffries & Thorndike, Inc. •: Offering—Company
'
are
per
,
J;•, '..v/
v.v
*
shares
$8 per share.
Pro¬
$625,000 4% bonds and
$638,600 first and second debentures; balance for working
capital.
:
1
Nov. 13 filed 400,000 shares
Textron Southern
Southern. There will be nO
„A-, <AAAA
for the account of certain stockholders.
Inc., Providence, !?. I.
of
A'A'•••:-5'A
share;
100,000
ceeds—Will be used to redeem
Velvet Freeze, Inc.
Nov. 8 (letter of notification) 12,000 shares of 5% con.•vertible preferred, to be offered in! exchange for shares
common
A-A
of stock.
Texas Vitrified Pipe Co., Mineral Wells* Texas
7> (letter of notification). 3,000 shares (no par)
A
■'
preferred stock and
Underwriter—Sills
Preferred, $10
whereby all the lumber produced by the registrant will
be sold to Templeton. Price—$100 a share for each class
Nov.
class
vertible
—
fering date postponed.
Textron
AAA. ~f-\
,
.
customers of the Herbert A. Templeton Lumber Co. with
whom the registrant has an exclusive sales contract
advantageous time. Of¬
Price, $100 a share. No underwriting. For
struction and equipping a plant.
<
Valsetz Lumber Co., Portland, Ore.
Oct. 4 filed 14,000 shares ($100 par 2% cumulative Class
A preferred and 2,000 shares ($100 par) 2% cumulative
Class B preferred. Underwriters
None. Offering —
Stocks will be offered for sale to customers and former
pany's 75,000 shares will be used for increasing working
capital, with a view to entering the Frequency Modula¬
of
AA1' A V-
Proceeds—Net proceeds for the sale of com¬
common.
filed
/•Wheeler, Osgood Co., Tacoma, Wash.
Gct.^7 filed 80,000 shares ($5 par) 50c cumulative
Proceeds—For enlargements and improvements of power
plant facilities. Offering date indefinite.
■
selling 135,000 issued and outstanding
an
20
sold in connection with
company's projected $132,000,000
plant expansion, of which* $49,000,000 had been expended
up to Sept. 30.
; .'j
'
<
•>
■
.
Westinghouse Electric Corp., Pittsburgh, Pa.
common.
shares, for their own account.
Offering—Price $6.75 a
\share. Options—Selling stockholders are also selling to
the underwriters at 7 cents per option warrant options to
^purchase 18,000 shares of the issued and outstanding
common owned by them.They are also selling to Hallgarten&Co., for $1,500, plus $360 as a contribution
toward the expenses of issuance, options to purchase an
additional 18,000 shares of the issued and outstanding
tion and Television fields at
Manufacturing Corp., New York
1
v
500,000 shares of cumulative preferred
stock, series B ($100 par).
Underwriter—Kuhn, Loeb
& Co., New
York, and associates. Offering Price—To be
filed by amendment.
Proceeds—The shares are being
■
July 18 (letter of notification) 5,500 shares of 4% % first
preferred stock series B ($50 par). Offering price, $50
a share.
Underwriter—First of Michigan Corp., Detroit.
Tele-Tone Radio Corp., New York
common.
•
14
Nov.
Mich.
'Aug. X filed 210,000 shares of common stock (par 50
'cents).V Underwriters—Hirsch & Co. ; Offering—Com¬
pany is offering 75,000 of the shares registered.
Eleven
are
3,000 shares ($100 par)
Price—$100 a share.
No
capital and payment of
•.
'
Upper Michigan Power & Light Co., Escanaba,
temporarily postponed.
stockholders
U. S. Television
Underwriter
—Amos Treat & Co.
Proceeds—For payment of notes,
mortgages arid for general corporate purposes. Offering
/
Corp.
pansion'of business.
cumulative convertible preferred stock and 44,300 shares
common stock (par 50c).
Offering—Price $6 a share for
a
preferred.'
For
Western Reserve
Finance Co., Cleveland, Ohio
(letter of notification) 4,000 shares ($50 par)
preferred and 2,300 shares common (no par).
Prices—
$50 and $5 respectively. No underwriting. To increase
capital. ;;.-;v- s
;:-v
•
(letter of notification)
cumulative
•
•
Nov.
Nov. 4 filed 300,000 shares (no par) convertible>; pre¬
ferred. Underwriters—Names by amendment.
Price by
amendments Proceeds—For working capital andex¬
Taylor-Graves, Inc., Saybrook, Conn.
preferred and 75 cents
Aluminum
own
remaining 20,000 shares are being sold
by Allen & Co., New York, with Shea as underwriter.
—
working
organization disbursements.
i£
• v,>
1
States
underwriting.
>
-
—
United
:
$1).
pany
initially.
None. Price
account and the
$30 a share. Proceeds — The
company stated that $500,000 of the $1,495,000 proceeds
will constitute the capital of. the company, and after,
deducting $5,000: estimated expenses, it will classify
$995,000 as surplus.*
July 17 filed 197,500 shares of common stock. $ Underwriters—Glore, Forgan & Co.
Offering—The offering
represents a part of the holdings of the present stocks
holders. Indefinitely postponed.
l- *>
-
Aug.
Proceeds—Shea & Co. is selling 26,400 shares for its
' United Benefit Fire Insurance Co., Omaha, Neb.
Oct. 7 filed 50,000 shares ($10 par) common. Under¬
{'
r *
/
loans,
West Virginia Water Service Co.
Aug. 6 filed 46,400 shares (no par) common.
Under¬
writer—Shea
& Co.,
Boston.
Price, by amendment.
10-year 6%: debentures;; Any balance will be added to
working capital.;
of
various expenses, repayment of bank
purchase of equipment and for working
capital.
of-notification).:$56,000 ..of closed first
hearings
on
the.; sale of Capital; Transit Co.'s' 120,000 shares
t
(Continued on page 2662)
)
,
2662
THE COMMERCIAL 8c FINANCIAL CHRONICLE
next
(Continued from page 2661)
of capital stock owned
by Washington Railway & Elec¬
tric Co.
•
■:
•
$26,000,000 contract for 284 railroad cars which
calls for the complete replacement of all passenger cars
on the Chesapeake & Ohio, Pere Marquette and Nickel
a
Plate roads
awarded to
was
the Pullman
Standard
Car
Manufacturing Co. today.
Robert R. Young, Chairman
of the C. & O., stated that it was the largest equipment
contract' ever placed with one manufacturer by any
railroad or group of railroads.
Delivery of the new cars
is scheduled for the last quarter*of 1947, but Mr. Young
added
that
it
might be the middle of 1948 "before we
have any substantial amount delivered.
The replace¬
ment will be financed by equipment trust certificates at
an
interest
clude
cost
Halsey,
of
less than 2%.
Stuart &
Co.
Inc.;
Hutzler; The First Boston Corp.
•
Delaware
Lackawanna
Probable bidders in¬
Salomon Brothers
,
/./
&
«\
& Western RR.
(12/15)
receive bids for the sale of $4,000,000
equipment trust certificates, series E,. up to ;12 noon
(EST), Dec. 15, at 140 Cedar Street, New York 6, N. Y.
Probable bidders include Halsey, Stuart & Co.; Salomon
Bros. & Hutzler, and financial institutions.
Company
•
will
Iowa-Illinois Gas & Electric Co.
Missouri-Kansas-Texas RR.
under consideration plans
obligations through sale
of a new bond issue.
Issues for which refunding is
being considered include $10,578,000 of United Light &
Railways consolidated 6% bonds and $5,422,000 United
Light & Power 1st lien 5V2% bonds.. The new bonds,'
expected, may be ready for offering by April of
f&.y'
would be to replace
1966 with
a
the second method would be to issue
the improvements.,
,
,r
•
Pennsylvania Turnpike Commission.
Nov.
Nov. 20 reported the Commission has completed all work
new
Three
bonds.
investment
banking
groups
re¬
market
stock is offered include
Shields & Co., and Alex. Brown & Sons
(jointly); Drexel
Co.; B. J. Van Ingen & Co., and Blyth & Co., Inc.
(jointly),
"
^
<
v
Dec.
Southern Ry.
,,
,
Co., Washington, D.,C.
.
Electric
/
*
Triborough Bridge Authority
war one
crux
of
the
*
question
now
up by the Triborough Bridge Authority,/
together with Madison Square Garden Corp., in prepara¬
tion for the finaricjng of the New Madison
Square
improvements in 1947 and 1948, and has considered
required funds. One considera¬
Garden.
Probable underwriters include Dillon, Read
Co. Inc.
■
.
phase
of
the
same
question
now
pervading
the
budgetary
discussion by the; General Assembly's. Finance and Budget Comjnis*
sion at Lake Success.
As
Senator Vanderberg
stated to the
General Assembly last week, the record discloses that to date
1
the
MM
international
BANK
v
'■
ECONOMIC
ANO SOCIAL
COUNCIL
to
the
TRADE
ORGANIZATION
new
Congress in *
January in his annual
Associated
Press
message,'
Washington ad-'
vices reported. ' Presidential press*
secretary
Charles G. Ross de-i
to reveal the extent to:
which consideration of the Pres-(
ident's program had progressed
and would give no indication
pf*
clined
whether Mr.; Truman in ight hav^
in mind labor law/modifications.*/
,
•ICWPUMCO';
trwTVI fftff
SflnMWwre
PROPERTY
DISPOSAL
■BSpLoYMDfT
ACT
our
When
V
UDIOMft • V
BRfTISH
FOREIGN
'
RANK
invite
•
d
e
,by
reporter*!
Republican; majority^
White House for:
conferences,
Mr.
Ross
leaders to the
yV*<Yi's'
50
k
the
INVESTMENTS
NATIONAL
shooting down of our planes by her gunners. And a bit less con¬
cretely, our philanthropies have again and again been greeted by Various
vituperative Slavic abuse, such as the Russian characterization of our
generosity as manifestations of "a capitalistic plot," "encirclement,"
there is
etc.;
a s
whether the President planned to
PRIVATE
LOAN
EXPORT-IMPORT
•;
weekly
the
;'SrTiT-^
Diplomacy" is just as reprehensible as is, or was,
legislative program to be sub¬
mitted
INTERNATIONAL
gftswwriONU.
past help to Yugoslavia to the tune of
footing three-fourths of UNRRA's bill of $490,000,000 there, and our
directly sending them tractors and other goods, have been greeted by
*
While House announcement
A
13 stated that President'
Truman had commenced work on
Today surely the political elements pervading the behavior of the
most important nations asking for material aid, cannot be dodged.
For example, it is difficult in weighing questions of further
help,
to overlook the fact that
President Considering
Legislative Program
on" Nov.
does not feed the citizens
*
''
'
before the United States and the United
*,
-
~'
Nov. 15 reported plans for a $20,000,000 bond issue are'
enemy
Nations.«
'■
.
/
being drawn
two methods for raising
.
'
:
Nov. 14 before SEC hearing on liquidation of Federal
Light & Traction Co. (parent) Arthur Praeger, President
told the Commission that company ;will need
$4,000,000
for
«
(12/3)
,
Public Service Co. of New Mexico
■
:'
15, 1956. Probable bidders include Halsey, Stuart & CoJ
Inc.; Salomon Bros & Hutzler; Harriman Ripley & Co.j
Harris, Hall & Co. (Inc.).
•
•
;
Company will receive bids up to 12 noon EST Dec. 3 for
the sale of $7,600,000 equipment trust certificates dated
Dec. 1, 1946 and due semi-annually June
15, 1947-Dec.'
11 SEC will hold hearing on Washington Railway
Go's. plan of dissolution which provides
among other things that Potomac Electric sell through
competitive bidding 140,000 shares of 3.60% preferred
&
Kuhn, Loeb & Co., Lehman Bros,
and Glore, Forgan & Co.
&
Potomac Electric
stockholders; authorized the issuance of Up to
position to carry through a financing program when
conditions permit. Probable underwriters whert
a
ported preparing to enter competition, viz.: Glore, Forgan
& Co., and Lazard Freres & Co., Inc. (jointly);
•
20
200,000 shares (no par) preferred stock. Company does
not plan to sell any of the stock
presently but will be in
preliminary to offering its proposed issue of $46,000,000
in
.
on
For example, during time of
^
Studebaker Corp.
nation, although on principle the desire to keep fellowhuman beings from starving is perpetually and universally prevalent
in decent people. Determination of the peacetime provocative point
at which the extreme political position of refusal of relief is adopted,
despite the affirmative humarie and economic motivations, is the
an
,
'
•
the line against extending such relief? Obviously such a line must be,
and always is, drawn at some stage of international political contro¬
versy.
bonds to fi¬
more
nance
at
cost
several highly questionable premises. The funda¬
mental issue here confronting the UN is determination of responsibil¬
ity for relief to other countries. Exactly where does a nation draw
of
$5,492,000 first mortgage bonds
competitively and
issue to be sold
new
.
Works."
win Locomotive
(Continued from page 2605)
UNRRA, rest
of
bidders will
Observations
f.
(12/2)
tion
Puerto Rico Water Resources
provide funds'for purchase of new ./; •
.Authority
equipment as follows: $482,400 for purchase of 100 hop¬
Nov. 18 B. J. Van Ingen &
Co., New York has been
per cars from American Car & Foundry Co.; $449,990
named to form and manage a syndicate to underwrite/
for five diesel electric switching locomotives to be
and distribute a new issue of
pur¬
approximately $50,000,000
chased from General Motors Corp.; and $449,865 for five
of Puerto Rico Water Resources
Authority Electric rev-/
diesel-electrie locomotives to be purchased, from Bald¬
enue bonds.
which
stock (par $50).
Nov. 15 reported company has
for refunding its outstanding
it is
year.
Probable bidders include Halsey, Stuart &
Inc.; The First Boston Corp.
Company is advertising for the lowest interest
Chesapeake & Ohio Ry«
Nov. 19
Co.
Thursday, November 21, 1946
reiterated
avenues
point
one
member
-
what / the
t
President
of U. S.~
on
nations
Largesse to the World's Under-privileged himself h^ lsaid earlieri. that*
decision on weekly consultations ?
would be made when Die ?new#
which there is complete unanimity
among, the Congress meets.
'
;
namely on the suggestion that the ^United
States should pay 50% of the
organization's expenses. "I detect no
it seems that we are being forced into both. veto to
this proposition, except
my own
initial disclaimer." The Death of Frank Watts, '
Thus former Treasury adviser Jacob Viner, who has always been
American burden regarding the
special organization may be even Former
firmly opposed to such policy, (as quoted in the "Chronicle" of Nov.
ABA President v t
larger, for the UNRRA-minded Soviet is paying for none of these.
14), now states that so great and ominous is the Russian-cum-satel- And
The deaths of three ABA lead-;
this item will be appreciable—Mr. Archibald McLeish in
Paris
lites' threat to Western democracy, that he now must urge our "frank
this week already managed to visualize a
ers,
namely, former Presidents
budget of not less than
and deliberate resort to dollar diplomacy."
Similarly, an important $2 billion for UNESCO alone.
Philip Benson and E. F. Swinney,'
Administration official, John Carter Vincent, Director of Far Eastern
and Brig.-Gen. Leonard P.
Ayres,'
Of course there is "no Veto " but.
Affairs of the State Department, last week
only enthusiasm, by the USSR,, were noted in our
forthrightly told the
Nov.-14 issue, /
National Foreign Trade Convention, that the United States should not charged with but 6%; by the United Kingdom with 1QV2%; Poland
Page 2525. In calling attention to./
with 1 %; Yugoslavia 0.3%; and the rest of the
invest private or public capital in countries with "widespread cor¬
Organization's "major¬ the death since of Frank O.
Watts,
ruption in business, and official circles" or where "a government is ity" of 50; for sticking the United iStates with half of the administra¬ President of the American Bank-1
wasting its substance on excessive armament v.
or where undemo¬
tive bill.
ers Association in the
|
year 1910-*
cratic concepts of government are controlling." Is there
any more
11; an announcement from the *
reason for giving—in lieu of lending— on a blank-check basis—with
ABA on Nov. 13 stated that.he;
Weighing all the above-cited factors that ar$ involved, it would
us footing 50% -of the UN's said blank check?
Are we not at least
died on Nov. 5 in St.- Louis.
Mr.,
seem only proper, for the United
$tates to retain freedom of action Watts was 78
entitled, as Secretary Acheson states, to direct control over the dis¬
years old and was /
in fulfilling its humanitarian
pensation of our largesse?
<
'
obligations individually as it sees fit. active in banking circles for 58^
1
While "Food
Dollar
—
Diplomacy,
j
-
.
he was Honorary Chairman of the I
experienced a decline in vol¬ board of the First
National Bank
ume
from Augustr to; September;
in St. Louis. ■ Mr. Watts had also-
ers
Mortgage Financing
Down 7% in Sept.
Compared with September of last
existing commitments must not be overlooked. In addition
to
the $2,235,000,000 of
concrete contribution already made to
UNRRA, this country has additionally substantially given of its re¬
Mortgage financing activity in
sources and
its services, pursuant to the dictates of the Atlantic
the nation during September de¬
Charter, the United Nations and its own initiative (as the Bretton
clined
7%
from
the
previous
Woods organizations).
This can be vividly seen on the appended
monthly peak reached in August,
diagram.
j
f
,
•
,
;
tures,
our
Of far greater permanent import than the immediate
disposition
question of principle as to whether the
be stampeded or otherwise forced by
majority votes, to accept responsibility for the overwhelmingly
major share, but not control, of these undertakings; Up to the pres¬
ent
have footed
can
less than
72% of the UNRRA bill, whereas
Russia, who is loudly backing the proposal for "joint" action, has con¬
than one-tenth of 1%, Under such circumstances the
we
no
tributed less
Soviet apparently is willing to "share" in international action, but
only when it gets such an edge—witness her persistent refusal to
participate in practically all the ether international organizations,
Bretton Woods, the International Trade
Organization,
UNESC&
as
which
convened in Paris this week, and the projected UN plan for helping
Europe's devastated
This attempted
000,000
4
areas.
foisting of one-half of the proposed annual $400,-
UNRRA-continuation
expense
is
just
a
slightly different
a
rise, of
September 1945.
50%
The NHA's
nouncement continued:
"With
ance
a
2%
the
first
more
nine
a
than
months
rise in Septem¬
150%. For the
of
1946, mort¬
financing activity totalled
$7,700,000,000—93% higher
than for the same period of 1945.
gage
about
The compilations are limited to
recordings of mortgages of
over
000
an¬
or
less.
Following
$20,-
are
the
number and amount of
recordings
1946,
by type of lender, together with
their relative participation in the
total of mortgage activity:
^;
exception
of
ber
reported on Nov. 9.
However, the total of $929,000,000
of non-farm mortgage
recorded
represented
com¬
panies reported
ministration
of UNRRA, is the inherent
com¬
mercial banks and insurance
the Federal Home Loan Bank Ad¬
Fumbling for the Check
mutual savings banks,
year,
-
United States should and
At the time of his death
years.
American Help Thus Far
In weighing ^Americ^'s1 further'giving df blank checks as
urged
with Mr. LaGuardia's colorful strictures and fine humanitarian
ges¬
of insur¬
increase, all types of lend-
Savings and loan associations-^-,.,^.!.,-.,...
Insurance companies
Banks
Mutual
and
trust
*
Number
companies-^—..,—
savings banks—..
Individuals
:f
,
.
74,076
/
338,896,000
lending
Institutions.
191,615
393,731,000
-
4
;.,
..
,
_
5
1,527,025,000
20
902,546,000
12
1,860,223 J,1- $7,697,257,000
:
•
100ft
leadership'in
banking affairs. ? Other details of
Watts' career were given in
these columns Nov. 14, page 2536.
Elects Ambassador Rocha
When
Spruille Braden, Assist¬
Secretary of State, declined
the Chairmanship,^
according to
'Washington- advices (Associated
that
;
,
<
?
Pan American Union
on
refused
;
/
Mr.
Press)
25
■
Tennessee
can
UnionL Ambassador Antonio
Rocha of Colombia was elected to
34 ft-
1,946,672,000
,
v
the
Chairmap of the Gov¬
erning Board of the Pan Ameri¬
% of Amount
$2,588,387,000 *
473,920
—
Miscellaneous
59,510
433,459
.
Amount
627,643
tr.— ~-y
of
the post of
'
~
President
held many posts of
ant
for the first nine months of
companies, which registered
been
Bankers Association, of which he
was
a
charter member, and he;
the
Nov. 6.
Mr. Braden had
to
accept on the ground
United States had held
the honor for many years and
that he intended to riand by the
Mexico City decision to rotate the
Chairmanship. '//v/V/',
s
Volume
Number 4544
164
THE COMMERCIAL d FINANCIAL
CHRONICLE
^
six
with
Our
"Earlier
/
u
....•»
V- > 1
•
sizable
offerings
in
the
week
This promised to be
is
no
with two
organizations, what
substantial undertakings
due
reach
-provided
nothing happened to upset plans
of
the
bankers sponsoring
the
operations.
r
Bethlehem
/
Steel
issue
of
Corp.'s
'
30-year " sinking
bonds
-
with
-•
of
fund
*2%%
for
the
Hiram
tenance
Worts,
in the
But
discussion
debenture
According *t6 thosfe who
And
late
wide
on a
slated
was
to
scheduled
to
be
and
issued
block
a
of
Portfolio
for
managers
the
] James Lees & Sons Co.
Qf the 30,000 shares
-
of
new
14,399 shares will be offered first to
holders of the outstanding senior
issue on an exchange basis. The
some
securities,
are
re¬
These
buyers* hard bargain¬
ers1 always, have not relaxed
much in their demands, accord¬
_
ing
to
people
in such
mains
who
get
around
circles, but the fact
that
they
to
consider
Their aim, "say those who are
of what goes on, is to take
aware
new
.
stockholders
Will
and
provide
funds for working capital and for
use in
•new
financing construction
plant at Glasgow, Va»•
of
to
trade than they
which
has
tasks
easing
now
tion of
sult in elimination of Statis¬
6.
.
Manager, Dealer
-
&
Chronicle,v 25
; Park
New York 8,
Power
December
record
the
at
Financial
the
of
Treasurer.
to
at
120
MILTON L. SELBY, Secretary.
October 28,
1946,
November
A
cash
distribution of
15,
of
record
29,
at
the close
1946.
of
business
S.
"An extra dividend of
lit per
1947, to stockholders of record at the.
close of business November
27, 1946. -
•:
•
|COAL
OHEROUNY, Secretary.
61 Broadway ;V
New York 6, N. Y.
November 12, 1946.
COMPANY
meeting held today, declared
Company,
UNITED
a
payable
meeting
dividend of
holders
A.
in
securities
twenty
($0.40)
business
share
per
NO.
of
per share
of
record
the
at
10,
1946.
a
fix^d
established
such Common Stock..
: ;
-T.
close
The
of
business
directors
annual
have
dividend
*.
H.
record
the
at
mailed.
:
American Cyanamid Company
Preference Dividend
The Board
•
of Directors of American Cyanamid Company, on November
1946, declared a quarterly dividend of 1 lA% ($.125) per share on
the outstanding shares of the 5% Cumulative Preference Stock of the
Company, payable January 2, 1947, to the holders of such stock of record
19,
December 2,
1946.
,
*
m
\
\
(
'
:
Common Dividends
The Board of Directors of American Cyanamid
19, 1946, declared
?
%
.
|§
A dividend of twenty-five
cents (25c) per 8b are ofi the
-
J-
Corporation
M
payable Dec. 14, 1946,
H
stockholder^
Common
Nov.
Stock
this
.
November
•
|
-
2,
1946;
'0fr
'•
shares of the Common Stock of the Company, payable December
28, l946j to the holders of such stock of record at the close Of
business December 2, 1946.
'
'
g
ff
declared
|l
of
was
on
.
A special dividend of fifty cehts (50tf) per share on the
outstanding
2.
P
Company,
,
dividend of twehty-five cents (25(0 per share on the
outstanding shares of the Common Stock bf the Company, payable
January 2, 1947, to the holders of such stock of record at the close
of business December
f§
Manage Statistical and Underwriting Departments*
•"
A quarterly
securities.
on
s
to
§|
record
of
,
W. P. STURTEVANT,
Secretary.
||
29,1946.
■)
1
[§■
An
§f
cents
the
Common Stock of this Gor-
■§§
H
poration
f=
aWc Decemker 14, 1946
rxrfu
REDEMPTION NOTICE
Jf
M
me
to
make
v*
>
decisions
v.;
-<
_
^
sr
.
dividend of fifty
extra
(50c)
per
share
on
declared
was
I
p
payto
f|
H v Checks' will be mailed.
Great Northern Railway Company
%
§§/'* stockholders of record
J Nov. 29, 1946.
jj
=
'
-■
(
:vy;
General
1
§|
|
.
Mortgage 414% Gold Bonda*
Series E4 due July 1* 1977
to be called
for redemption July.l, 1947
i.:
*r=
.v
NOTICE OF PREPAVMENT
executive
TREASOBEB
=
Philadelphia,
"
lilllll security!!
analyst
enced
in
servicing
Salesmen
Traders—Listed and Unlisted Securities.
$10,000.
Box
J 119,
Financial Chronicle, 25 Park
standing at 105% bf principal amount plus afcerued interest to
date,;,.'-.V;; y:'"
and
Commercial
&
Place, New Ifork 8.
105% bf principal
amount together with accrued interest to
July 1, 1947, by sur¬
rendering such bonds with all unmatured appurtenant coupons
ELECTRIC BOAT COMPANY
33
PINE STREET, NEW YORK, N. Y.
The
Salary
Holders of said Series E Bohds may obtain prepayment of said
at thb redemption
price thereof, viz.,
bohds
IIIIII1MIIIIIII11HIIII1IIII11HIHIIIIHIIII
Board
declared
per
required
the entire i&sue bf the above mehtibhcd Series E Bonds then out¬
America's NSf ciqar
I
Effective speaker—experi¬
Customers,
irrevocably
of.the City of Nfew YoTk to
publish appropriate notices calling for redemption on July 1, 1947
said
whose work has been syndicated
If out coast to coast.
Great Northern Railway CUMFANy has heretofore
diretted The First National Bank
PHILLIES
'
Financial writer
«
Nov. 15,1946
m
-
i
Pa.*
a
share
of
Directors
dividend
on
the
of
has
this
day
twenty-five cents
Common
Stock
of
the
Coftittany, payable December 10, 1946,
stockholders
of
record
at
the
business November 28, 1946.
Checks
will
be
mailed
Trust Co., 16 Wall St.,
N. Y., Transfer Agent.
H. G.
November
14,
by
New
close
1946
elbse
City of New York, at its bffice,
Street, New York 11, New York, on or prior to the
business PfccetnbeP 27, 1946. Payment as aforesaid in
2 Wall
of
■
respect of
bonds
so
surrendered will be made within five days
after the surrender of such bohds.
to
of
Bankers
York 15,
SMITH, Treasurer
td The First National Bank of the
No.
GREAT NORTHERN RAILWAY COMPANY
By F. J. GAVIN, President {
St.
Paul, Minnesota
November
7, 1946
"
.
,v
•'
'.•
•
-
on
not
on
y
of
close
on
MIRACLE, Secretary.
December
W. E.HAWK1NS0N, ,
Secretary-Treasurer.
November 12,19i6.
convincingly*
rate
90
to:
Appraise situations based
(20c)
upon
5,
1946.
Transfer
books will not be closed. Checks will be
natu-
cents
dividend
of forty
the issued
and outstanding Common Stock, without
par value of this company, has been de¬
clared, payable December 23, 1946, to
registra¬
was
DIVIDEND
quarterly
ragttlar
Dividend
Stock
of
the
corporation
was
payment January 2, 1947 to stock¬
for
December
'
Secretary-Treasurer
November 18,1946
CORPORATION
Stock
the
Common
declared
will be mailed.
of
Board of Directors of
United Gas Corporation held November
20, 1946
a
on
a
the
Charles £. Bkachlev,
GAS
1
Treasurer..
1
-Common
At
•
the Com¬
on
j. B. McGEE
'
quarterly
12,
1946,
to
shareholders
of
record at the close of
business on November
•
share
declared, payable January 9,-
has been
November
on
:
share has been
1946,
stockholders of record at the close of
business November 27, 1946.
'
to
twenty-five cents (25c)
share
and
a
special
cash
distribution
of
seventy-five cents
(75c) a share have today
bsen declared by Kenneoott
Copper Corporation,
payable on December 21, 1946 to stockholders
a
per
declared, payable December'12,
1946
29, 1946; Checks
cents
Tennessee
Corporation
.
A dividend of
Broadway, New York 5, N. Y.
December
AIUS-CHAIMERS
holders of such stock of
the close of business Decem¬
ber 4, 1946.
KENNECOTT COPPER CORPORATION
V,
to
the
January 1,
1947,
busi¬
ftNNCSm CORPORATION
,
at
4, 1946,
Secretary.
dividend of 35 cents
per share
mon
Stock of the
NOTICES
payable December 17,1946,
and $1.25 per share on the
Company's
5% Preferred Stock,
payable
(Incorporated in Pennsylvania)
DIVIDEND
prom¬
speedily. Box
H1114, Commercial & Financial
Chronicle, 25 Park Place, New
York 8, N. Y.
N. Y,
&
dividend of ONE DOLLAR a share has
been
declared
on
the
capital
stock
of
this
Company, payable December 17, 1946, to stocaholders of record at the close of
business <m
December
2,
1946.
The stock
transfer
books
of the Company will
not be closed.
hbr.vey J. OSBORN,
at e
monumental
Analyze individual
sound
Place,
le
record
close
10, 1946.
H. P. SANDERS,
Safeway Stores, Incor¬
October 28,1946,declared
holders of such stock of record
close of business December
INTERNATIONAL SALT COMPANY \
475 Fifth Avenue,
New York 17, N. Y.
al plant facilities.
judgment and train
Secretary
available,-Box jj1113,
Commercial
Electric
of
on
Suarterly dividendsPar25c perCommon
Company's $5 of Value share on
Stock
«
Stock
PITTSBURGH CONSOLIDATION
See samples of
my work. Engi¬
neering studies and C.P.A. back¬
ground have helped balance my
Junior
porated,
'
Preferred
Directors of
or
Treasurer.
capital for general purposes, in¬
quick field visits.
tical and ^Underwriting De¬
now
;
on
$7
Directors
of
cluding construction' of addition¬
COMMON
5. Write reports to stockholders.
re¬
Notice is hereby gtven that the Board
The Board *>t Directors of
1. Forecast market trends.
ILLNESS
Security Analyst
of
1.
4.
and
Board
&
Stock Dividends
:
,
on
undertaking
Financial Writer
3. Talk
Man,
and
at the close of business
2.
Preferred and Common
American
declared
Light Corporation
Dividends
A,
stockholders
Qualified
of
Will be used to expand
working
SITUATIONS WANTED
SITUATIONS WANTED
Contact
new
stock
registration
Proceeds from this
Secretary
Stock
to
ness
to
,.
underwriting fraternity, from a
^standpoint of new issties, what
partments.
in
Pre¬
$1.25 per
.
a
All in all the current
week; has
fceen the best in some time for the
principal partner will
preferred
been
of
MFG. CO;
inyolved
new
plan
With SEC.
had been in
ChairmSirSaffre.y's
of
reportedly
bring out, the 70,000 shares of
Security Registration
ise
held
'•
-
The
y
cumulative
Safeway Stores, Incorporated
the
on
Light Corporation at a meeting held on Novem¬
ber 20, 1946, declared a dividend
of $150 per
share on the $6 Preferred Stock and a
dividend
of
$1.75 per share on the $7 Preferred Stock
of the Corporation for
payment January 2, 1947,
stockholders
a
preferred stock of the KimberlyClark Corp,
Good Week in Offerings
of
of
up
intact, investors will have an op¬
portunity for subscribing for new
:
JACK,
$6 Preferred
"
Kimberly-Clark. Corp.
Tomorrow, if schedules are
Securities and Exchange Com mission
263,833 shares of $3 par
are being sold
by certain
con- y
prospectus.
hope of averaging down on such
lines over a period of time. Mean¬
while, as a result of this program,
they are definitely more anxious
unexchanged shares.
,
is
required and the simplifica¬
of others, notably much of
superfluous
matter
now
recent months.
The
*
protection
mandatory in the setting
4%
W.
Electric Power &
any ground so far as the
Bankers
"
Y.
without
This might, he indicated, mean
elimination of certain forms
tion
D.
be
material in the
balance, along with any ^unex¬
changed shares, will be sold pub¬
licly and proceeds used to retire
common
highly
the
re¬
showing
are
greater willingness
new securities.^
up blocks of
.
preferred involved here,
corporate
be showing a bit more
interest in new issues which have
been appearing lately.
areas.
the
revised
N.
January 2.
1947, to stockholders of record at the close of
business December 4, 1946.
believes
can
York,
DIVIDENDS
A dividend of $1.50
per share
ferred Stock <$6) and a dividend
on
the $5 Preferred Stock
Power
&
Light Company
were
November
20,
1946,
for payment
A
major insurance companies, prob¬
ably the largest single outlet for
called
of
he
DIVIDEND NOTICES
Light Company
New
STOCK
share
he
.
already
shares
common
that
view,
cerned.
Insurance Buy erf More Active
SImu 1 taneously, another
banking syndicate was scheduled to market hew preferred
£•' stock
clear
of
Rector Street,
PREFERRED
laws.
the family.
last midnight, but which, in reali¬
ty, was already pretty much of a
iayt in the coal producing
it
investors'
the
ported to
ready acceptance. The bnly pos¬
sible fly in the ointment here
Would - be the ' thine * Workers'
securities
point
satisfactorily
being
sold for members of the
Mellon family and charitable in¬
and trusts operated by
the
the procedure ; now;' is
complicated and that it
now
new
this issue, it is assured of
walkout
made
open
stitutions
of
looking at the matter from
practical
a
huge secondary opera¬
involving 399,860 shares of
capital stock of Gulf Oil Corp.,
tion
aT
have
of
giving
group
books
up -for
v
for
yesterday, following
the market, a nation¬
the close of
been watching the demand
shape
'
issue
Co,/gw^
in
market
circles
indicating
price of 100 to the investor.
■
Two
main¬
public
slated
was
offering,
t
new
$50,000,000
American Power &
inten¬
on
their
distributing
DIVIDEND NOTICES
>
y
chief
that there
busy day
market
>■
SEC
letting down
Sons, Inc., also preferred and
/common shares of the National
^Alfalfa* Dehydrating & Milling
a
V
the
tion
a
United States, Hiram Walker &
for investment bankers and
money
bankers
again
;Walker-Gooderham
&
'Ltd., and its subsidiary
R
to
Once
warned
'
Reporter's
-
financial circles.
$30,000,090
•vM1-
-•
brought to market
V
beings rally received with satisfaction in
handled provided those slated to¬
day appeared on schedule.
2663
;•>'
THE COMMERCIAL & FINANCIAL
In
New York Stock Exchange Wants Securities Acts
Simplified to Aid Listing of Foreign Issues
disclosure requirements stand in way of general list-'
ing of foreign securities on various national security exchanges.
Wants SEC to consent to substitution of a more simplified stateFeels present
facts for voluminous detail which is now de¬
manded. Exchange believes numerous opportunities are now lost
for investment of American funds in many parts of world. ment of essential
;
A
revision
possibly
even
Securities Acts and
of parts of the statutes themselves to eliminate vo¬
the
of
rules
and
forms of the
detail while
preserving^the principle of disclosure of ma¬ large American corporation to its
terial
financial
facts
is
being stockholders, for example, might
sought by the New York Stock be adequate for the purposes of
Exchange in a move to make it the law, it is thought.
Investors do not always under¬
practical for foreign companies to
list their securities on the various stand the voluminous document
luminous
security exchanges in this country.
the regis¬
The 1934 Act requires
tration of all securities—domestic
foreign—with the Securities
Commission before
transactions may be effected on
any
national security exchange,
but many foreign companies, al¬
though having securities outstand¬
ing abroad, would have to make
their .initial distribution here and
and
and Exchange
so
in addition would have to reg¬
matter how carefully it
may be prepared, because many
accounting terms in the balance
sheet of an average foreign com¬
pany do not always mean the same
thing they do on the American
ledgers, it is held. Reference to
foreign tax' laws, too, are often
either,
no
meaningless without some knowl¬
of
edge
environ¬
particular
the
apply or situ¬
ations out of which they arise, it
ment to which they
under i? the
1933 Act which calls for more in¬
is pointed out.
formation.
tion, such as data on foreign ex¬
change regulations and tax laws
of the country where the company
their
ister'
securities
; At the present time, it is often
only the foreign company desirous
of obtaining American dollars or
dollar, credits in this country that
is
willing to make the necessary
effort to conform to these regula¬
incentive exists,; it
for the average suc¬
cessful foreign company to go out
of its way to list its securities on
the New York Stock Exchange or
other American exchanges. Nu¬
tions.
Little
is believed,
merous
for
the
opportunities
investment
are
thus lost
American
of
funds in many parts of the world,
it is
thought.
\ The New York Stock Exchange's
-
Department "of Stock List is now
analyzing the forms and detailed
provisions of the Securities Act of
1933 from the point of view of
the problems of the foreign issuer
in the hope of developing concrete
proposals that may serve as a basis
General
organized may be more impor¬
analysis than great
detail in the financial statements
is
tant in final
ering changes that
■
may seem
de-
the study which
James J. Caffrey, Chairman of the
told the Association of Stock
Exchange Firms Monday night the
SEC staff is making of the over¬
a
principle of simplification could be
applied to the domestic field, it
would undoubtedly be a relatively
simple matter to extend it to the
foreign field, it is thought.
be
now
prepared.
A state¬
ment in the nature of the annual
Street
the same problem, al¬
though each is being tackled sep¬
from
any
angles
to
arately.
'
£■
•
,
Exchange views its par¬
ticular interest in the matter, the
that
made in the rules.
.
As the
changes
this
Thus,
like
to
broker
Emil
Schram,
President of the New York Stock
would
see
Corp.
In New Location
;
problem is not to abandon its own
Exchange,
long-term
traditional policy of
what it feels to be necessary dis¬
the
offices
25
to
investors,
disclosure
a
which, by the way, antedates the
SEC requirements in this regard,
but to find machinery to make it
more
practical and effective.
Broker Wants NYSE hi
the
for Court
Test of 100% Margins
"
(Continued from page 2607) 7yy
loss
caused
business
has
unnecessary hardship
an
thinks. The
100% margin rule has thus not
only removed a certain healthy
liquidity from the Stock Market
but also has caused serious in¬
on
the
jury
to the financial health
entire securities industry,
-
.
Board
for
in the matter
taking steps to remove any
obstacles
which
the Stock
Ex¬
(Special to The Financial Chronicle)
CHICAGO,
ILL. — Louis
C.
Seaverns has joined the staff of
La
South
large volume of
long-term
.
Cars
business
RALSTON STEEL CAR CO.
(freight
car
manufacturers)
fighting
Reserve rule that
Healey With Slay ton
(Special
if
/
out,
INDEX
of
For detailed index of
the
Exchange itself, he points
A - ;., (:;■ y y,::V;:y ;:yyy::
contents
'.'hr'/yI-
page
■
■
: v.-i'
2603
V'
\
.
7
*
V
.
,
v*
Farr With Crummer Co.
of
CHICAGO, ILL.—Omer B. Farr
has
become
affiliated with The
Crummer. Company,
Inc.,' First
National Bank Bldg.
in
De Groot With Waters
A Market Place
1946; high
...
about
Circular Available
LERNER & CO.
Inactive Securities
'■
Tel. CAP. 042S
.
7 7:
Boston Real Estate Trust
Consoliated Lobster
Air Cargo
Federal Asphalt
Transport
Thompson's Spa Inc.
Flamingo Airlines
Bendix Helicopter
Benguet Cons. Mining
Gaspe Oil Ventures
General Aviation Equip.
Greater N. Y. Industries
Columbia Air Prod.
Fairbanks Co.
Jones & (/amspn
Haile Mines
\
Cosmocolor Corp.
A. & G. J. Caldwell
Boston Ground Rent Trust
\
Happiness Candy
Holding
/
Copper Canyon Mining
Huron
Jardine Mining
Kellet Aircraft
Duquesne Natural Gas
Kinney Coastal Oil
Eitingon Schild
Lava
Ralph F. Carr & Co., Inc.
31
Now York
H.norer 2-7913
■
'Teletype
BS 328
Wm specialise in all
.
Insurance and Bank Stocks
Industrial Issues
Investment Trust Issues
HANOVER 2-4341
ST., N.Y. 4
:
Cap Gold
Morris Stein & Co.
Teletype Be 69.
Milk Street, Boston 9, Mass.
Boston
Hubbard 6442
Square, Boston 9, Mass.;
Telephone Hubbard 1990. y\
Teletype BS 289
:
for
.
10 Post Office
t
If. Yi Telephone HAnover 2-7914
Securities
Drico Industrial Corp.
12
148 State St* Boston 9, Mass.
-
;#•>'
TELETYPE- -N.Y. 1-2866
Teletype—N. Y. 1-971
Public Utility Stocks and Bonds*
TEXTILE SECURITIES
Securities with
a
New
Eng. Marked
Frederick C. Adams & Co.
New
_
Specializing in Zlnlisted
P.AB1 MASKS 4 C.
Specialist» in
England Unlisted Securities
24 FEDERAL STREET, BOSTON 10
Securities
Established lq 1922
Tel. HANcock 871S
,.//
■
Tele. BOston 2S>
FOREIGN SECURITIES
>.
<5PF,C*THTTCIT<J
50 Broad Street
i
*{«t
''A'*
• ">
Bank'—Insurance
•
; °
-
;New York 4. N. Y.
AFFILIATE: CARL MARKS & CO. Inc. CHICAGO
Puklic
Utility—Industrial—Real Estate
1
Grinnell
Fleetwood
Delhi Oil
Airflow, Inc.
COMMON
*Seaboard Fruit Co., Inc.
"General Products
Lumker Sc Timk er
Gerotor-May
Asphalt
PERIOD
„
1st quarter
1
;
397,510
Month of Oct. 186,000
W. T. BONN & CO.
New York 5
Telephone COrtlandt 7-0744
Teletype NY 1-886
"
,
Empire Steel Corp.
•Prospectus
on request
237,299
3rd quarter
Sunshine Consolidated
BOUGHT—SOLD —QUOTED
$14 7,321
*1
V:
ptocks
SALES
2nd quarter
Corp.
"Susquehanna Mills
Bonds, Preferred and Common
:
see
*f\!t v'r- '
'
*/•'$'%v
V']1
All Issues
Bell
Chronicle)
Financial
Street.
OREIGN SE
120 Broadway
The
LOUIS,
MO.—Edwin
H.
Healey has joined the staff of
Slayton & Co., Inc.,. 408 Olive
Federal
sanction
real
the
not
Stock
a
Firm Trading Markets
Mastic
to
ST.
has the implied
Differential Wheel
Market about 7%
HAnover 2-0050
;
He was
y
previously with Faroll & Co,
Established J 924
V
Co.,' 208
&
Street,
Salle
possible suspension of its
privileges by
••• ~t;
s
50 BROAD
:
Hammill
Shearson,
change itself may have put in the
way of those of its members who
may be inclined to test the issue
in the courts. No firm is going to
Low Priced Unlisted
report now issued by the typical
1
-Y
he
industry,
opinion.
New
Street,
Seaverns With Shearson
,s
this
of
Broad
fight
but by
risk the
Clear Way
Reserve
consideration
some
his
continue
Federal
at
opening of its new
York City.
against the 100% margin restric¬
tions not by appealing first to
closure
Securities Corp.
American
The
announces
.
.
particular
-
be
can
Bost, Inc.
indicates
which
material
voluminous
must
without letting the
community benefit
quirements
Aircraft & Diesel Equip.
Freight
of
Shortage
statement of the essential facts for
the
to
American Securities
of course, that
The Federal Reserve's recent
(Special to The Financial Chronicle)
requirements ruling permitting stockholders of
GRAND RAPIDS, MICH.—John
could be simplified for American a corporation to make up to 50%
companies seeking new money- use of their securities as collateral E. De Groot has been added to
through underwriting channels, it for the purchase of new issues is
the staff of"Dudley H. Water &
would probably be easier to ob¬ a
gross discrimination against the
Association of Commerce
tain a simplification in the law in Wall Street investor, he charges. Co.,
favor of the foreign companies He does feel, however, that this Bldg.
looking to American investors for
additional capital; that is, if the
simplified
more
may
general
a
disclosure
the
all problem, the hope is cherished
that the SEC will consent to the
substitution of
money
It is recognized,
if
;;
In the light of
his
Wall
his
sirable.
f
who desires to put
work in the home market are two
the
:
to
forerunner
the
of the Securities Acts for the ben¬
efit of the American investor who to margin trading in all its phases.
wants to enter foreign markets :;v It would appear to: him that
and the current attempt the un¬ Marriner S.
Eccles, Chairman of
derwriting industry is known to the Federal Reserve Board, is
be making to obtain changes in
staying up nights trying to figure
the Acts favorable to the investor out ways of relaxing margin re¬
itself, in fact, it is held.
;;
be
lowering of the bars with respect
and schedules about the company
for discussions with the SEC cov¬
..
informa¬
therefore, the Ex¬ partial relaxation of the rules
sense,
change's efforts to seek a revision
the
background
a
Thursday, November 21, 1946
CHRONICLE
Amos Treat & Co.
40 Wall St.
New York 5, N. Y.
BO 9-4613
Tele. NY 1-1448
REMER, MITCHELL
208 SOUTH LA
& REITZEL, INC.
SALLE ST., CHICAGO 4 •
WESTERN UNION TELEPRINTER
PHONE RANDOLPH 3736
"WUX" • BELL
SYSTEM TELETYPE CG-989
Hill, Thompsons Co., Inc.
Markets and Situations for Dealer*
120
Broadway, New York 5
Tel. REctor 2-2020
Tele. NY 1-2660
@FedFRASER