Full text of Commercial and Financial Chronicle : November 25, 1954, Vol. 180, No. 5380

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<7~.
NATIONAL FOREIGN TRADE CONVENTION FEATURED

nn&iXY'

of

Michigan

29 1954
UMmsmm
uuutr

Reg. U, 8

Volume

180

Number 5380

New York 7,

Pat

Office

Cents

Price 40

N. Y., Thursday, November 25, 1954

Copy

a

EDITORIAL

Trade Assistance Program
Impact of Government's
Role In the Housing Market Oi the Export-Import Bank

As We See It

;

I Several developments in various parts of the
world

currently

reminding

are

By JOHN R. WHITE*

differences in the economic fortunes of the

sun¬

raised

hopes (we should

a government
responsibility to provide housing, and
(2) the control of housing has been seized upon as a
means
of sustaining the national economy, Professor
White reviews history of Federal housing legislation and

tunately) among the political leaders of more than

backward country that

pne

millenium

might be in

problem is to offer effective assistance to the U. S. ex¬
porter in developing markets abroad, but stresses Bank's
credit can be used more effectively, to supplement avail¬
able private credit. Holds Bank's operations should not
discourage use of private capital in export trade.

the making for their

to underscore the

>•

brought to them by other peoples.
The Inter-American financial conference

'

under way

are

..

now

in

whether

that matter, of all

the other aid that has been extended them

chiefly

by the United States. They seem not only to
want more money, but to insist that it be handed
to them on a silver platter with no conditions
attached. Among these conferees there is ap¬

the world. There

is, of

quire behind the scenes

on

page

of

address

the

Savings

*■

"

\

■

■

»

•

to

Convention,

those
for

provided

their

by

nationals.

the

commended

establish¬

Export-Import Bank "to
the
financing
of
trade

facilitate

which normally lies outside the scope
of
the
operations
of
commercial

through

banks,

the

extension

'

of

credits and long-term financing in
cooperation, and not in competition,

in

with commercial
One

by

of

the

the

banks."

first

Bank

loans

after

authorized

its

organization
was negotiated by representatives of
the National Foreign Trade Council
had

and

for its

commercial

on

years

Hawthorne Arey

the funding of blocked dollar

purpose

accrued

intervening

accounts.

During

Continued
address

Session

by Professor White before the Annual Convention
Loan League of Ohio, Columbus, Ohio.

of

the

Council, New

and

by

Director

41st

York

Arey

Convention

City,

all

the Bank has been favored and
on

page

36
♦An

28

f

'

■

ment of the

balances

♦An

Continued

laration

the

page

save

Convention, held
in this city in 1934, the Final Dec¬

housing legislation or to its
With pile-driving impact, the legislative and
administrative record provides informative and concluon

and

At its Twenty-first

advocates.

Continued

-

countries

able motives to governmental

to sup-

course, no reason

other

to ascribe wild or insupport¬

or

'

Twentieth

its

comparable

this
change has not been a subtle one. It
has not been necessary for us to in¬

John R. White

national pride and
panhandling. Word from the Far East,
particularly the region of Indo-China, makes it
plain as a pikestaff that the Communists have not
left off fishing in troubled waters in that part of

earn

in 1933, the National
Foreign Trade Council proposed the creation by the
Government of an institution to assist in financing for¬
eign trade and to provide facilities
•

Upon close examination,

defiant

J

importing nation to

an

.

the

government and of the people
their attitudes toward housing.

parent a strange admixture of

•

Points out immediate

At

original proponents of
the FHA either recognized or fore¬
saw
the growth and power, or the
ultimate change in purpose, of this
agency.
However cynical it may
seem, it is difficult to see any other
than ulterior, political
motives in
many sections of the Housing Act of
1954.
Yes, a vast change has been
...wrought in the basic philosophy of

quite dissatisfied with the net product

r.

"

the

political leaders of the Latin American

«f Point Four to date and, for

/

-

•

in Brazil is already yielding the impres¬

sion that the

world

*

years have passed since the FHA was
trough of a frightening depression. In
their own way, both yesteryear's date, 1934, and today's
date, 1954, have a vast significance in a comprehension
v
"
'
•
of the Federal Government's par¬
ticipation in the field of private
^housing. Indeed, it is questionable
created

be

somehow

it

that

demand

apparent

*

:

which
dollars in

order to effectuate mutual trade.

Twenty; historic

yearning among the so-called

underdog groups for a better plane of living and
their

"

man-

enable

Asserts governmental intervention has

encing price determination.

peoples. These rather obviously vain hopes seem

Says Bank's

operations of the institution.

:

agement directs assistance only to those projects

artificialized the demand and supply of housing, making
these factors dependent on credit terms and thus influ¬

sort of semi-

some

to the

administratipn.

unfor¬

suppose

After reviewing the history of the Export-Import Bank,
Mr. Arey describes the present situation with reference

it is

"atoms for

peace" movement in United Nations circles seems
to have

f;

Presenting a two-fold thesis, namely: (1) that the
public has succumbed to the paternalistic concept that

dry peoples of the world, and of the very real

problems engendered thereby. The

J,|

By HAWTHORNE AREY*

Director, Export-Import Bank, Washington, D. C.

Adjunct Assistant Professor, New York University

of the wide

us

Nov.

15,

before
of

the

the

30

International Finance

National

Foreign

Trade

1954.

\
SECURITIES NOW IN REGISTRATION

Underwriters, dealers and investors in corpicture of issues now registered with the SEC

—

porate securities are afforded a complete

DEALERS

and potential

State and

undertakings in our "Securities in Registration" Section, starting on page 41.

in
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Preferred and

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department

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of

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rvice

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BRIDGEPORT

PERTH

Y.
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WIRES TO MONTREAL AND

Doheuox Securities
TORONTO

Goodbody & Co.
MEMBERS

NEW

115 BROADWAY
NEW

YORK

Analysis

upon

request

DEPARTMENT

Teletype NY 1-2270
DIRECT

Hampshire ;

"

Exchanges At Regular Rates

CANADIAN

Members N. Y. Stock Exchange
American Stock

of New

COMMON
f

Cahadian

T.L.Watson &Co.

sugar

Public Service Co.

YORK

STOCK

EXCHANGE

1 NORTH LA SALLE ST.
CHICAGO

Grpokatioti
40 Exchange

Place. New York b, N.Y•

IRA HAUPT & CO.
Members

111

York Stock Exchange
Principal Exchanges

New

and other

Broadway, N. Y. 6

WOrth 4-6000

Teletype NY 1-702-3

WHitehall 4-8161

Boston

Teletype NY 1-2708

Telephone:

Enterprise 1820

The Commercial and Financial CL rp
2

Iclt

Thursday, November 25,1954

.

(2138)

^

Their

week, a different group of experts
advisory field from all sections of the country

in the investment and

participate and give their reasons

for favoring

they to be regarded,

•re

as an

Gloeilampenfabrieken

This

proprietary

facturer's

sales

million

$20

figure

Established.

Stock

120

BOSTON

since

Exchange

York 5

perated

Wires to

k

paid
in-

tion

line

$0.75

to

seems

early increase

an

'
listed on the

$0.80.

or

common,

is

Exchange,

Stock

quoted at 17%.. This
with its postwar low of
8% in 1949 and to a high of 25%

compares

Exchange

year
my

products;

quisitjon of brand' names from
pects

to

could result in

method

increase

sales

fastest

the

Obviously

all three.

use

the third

and

Plough is understood to be studymg

possible

some

now'

'

acquisitions

'•>

income in

Net

to surpass

1954 is expected

last year's $1.30 a share

in

Plough

in

Company

(including
children),

Company
Dan River Mills

Charles
Members:

higher

Scott, Horner &.
Mason, Inc.

conscious.
own

LD 33

eral

Specialists in

St.

NORTH and SOUTH

|

CAROLINA
MUNICIPAL B

IDS

children

Joseph

petitors
A

nose

and

this

Ci.aiifee

from

to
a

months

Bell System Teletype:
*

■

Active

2

RH 83 4c S4

Telephone 3-0137

)

Trading Markets in

'

ago

in

aged
was

RICHMOND, VIRGINIA

'

came

a

nose

plastic

introduced

Mistol

Mist.

Bayer

pack-

spray

bottles

squeeze

the

name

the

of

Liquid.

liquor distribution business, owns
six retail drug stores in Memphis,

BROKERS

livery

of

the

to

a

total-of

radio

in

Chicago. Application is
pending for a television station in
Memphis.
This
back

traces

concern

to

1908

Plough

when

its

history

16-year

borrowed

$125

old
and

compounding
Plough's
Antiseptic Healing Oil in a room

(fowahewwi&. r€at

runs

production
of

ore

the
open

finally

pit

out. With

capacity of 60,030
day this colossus

per

a*r<;a<*y known as the

world

s

largest

derground

lts

siren8inemnS
...

A1

sighted

non-ferrous

operation,

etVpn p-thpnim*

^

policy

underground
gress

market

mine

price

to

is

un-

steadily

commanding

with completely
the fargo

and

modernize

ie eohcyTafS

all

adopted

treat

and

'

1

over

10,000,000

years

nomic

ores

at

Memphis. Today

over

100 mil-

Tele. NY 1-3222

which

will

not

of

of

are

not

&

ec>

with

Retailing

company's regular supply oi
nickel for "military and ~ civilian
purposes.
The company's schednickel
production j during
period is estimated at 1,380,000,000 pounds of nickel, an in-

uled

,

of 325,000,000 pounds over,
deliveries for the four years, 1945

crease

to

1949.

nickel




and

57

foreign

A

United

stock

pile

States

£ar skort

are

contract,

Tel.

New York 4, N. Y.

BOwling Green 9-2956-8

Qf

their

needs.

An exoanding market is foreseen
from the aircraft industry for M
,aircraft, andln industry generally

Anticipated
ad°pti°" « .th.e purposes. The (or
turbine jet
industrial
as.

result

a

of

the

oftosft'S'

v^nf^tleS^ aC
containing nickel have met these

Cobalt,

con-

Government
entered into

50 Broad Street

continue to absorb large amounts of nickel and stainless
steels,
while commercial
users

which

the

company

producing in increasing

,

,

'Having

N. Q. B.
OVER-THE-COUNTER

1

INDUSTRIAL STOCK INDEX
14-Year Performance of
35 Industrial Stocks
FOLDER

ON

REQUEST

is

amounts,

tecnniques, is finding large use
Continued on page 15

states

.

•

Military and atomic energy pro-'

in the largest piston engines for
aircraft. Nickel alloys have the
high temperature properties re¬
quired by the jet aircraft and
other industries,

for

SINCE 1939

grams

be about 275,000,000 pounds. Cop-'
per
deliveries were 234,349,000
pounds; platinum metals 270,562
ounces; gold and silver 38,410 and
1,106,733 ounces respectively.
demand

I

i

per engine as is ordinarily found

The

Over-the-counter Securities

this

for 1954 the amount will probably

tinues without abatement, and the

WOrth 2-4578-9

•

engines and gas turbines need two
or three times as much nickel

pounds

Teletype J Cy 698

•

the

in

48

tax

COMPANY

price

through improvements in refining

all

N. Y.

JOSEPH MAYR

under-

market

interfere

5-6005

Direct N. Y. Phones:

P^,a®e.s and sold annually intensify may be called upon to
manufactured of ,its Products are company its already huge effort.
countries.

save

Exchange PI., Jersey City 2, N. J.

HEnderson

to

period

a

of
delivered in 1953, and

251,417,000

Exchange

25 Broad St., New York 4, N. Y.

and

nickel,

for

company

tons

current

^enToTWToducts^riute

above his father's furniture store
in

us

ASSOCIATES
15

120,000,000

was

two

owns

S/Mercury

WELLINGTON HUNTER

nickel

drugs
with its

compete

and

;

Trade with

of

not

"

U.

record

do

lines

,

Wyoming Gulf Sulphur

WJJD

distributes

Tennessee,

DEALERS

&

South Texas Oil & Gas

,

INCO is the largest producer of- stringent requirements. Virtually
nickel in the world; it ranks5 fifth1 all of. the special alloys developed:
im copper production (first in the for airplane gas turbines or jet
British Empire), and is a leading engines in recent years contain
producer of platinum metals. A nickel in varying amounts.
Jet

Abe

Phone: HA 2-9766

have

n

Frood

ness£ Plough 'operates ^wholesale g*

started

Stock

e

latter

under

Sales

com¬

couple oL

a

h

King

a

w

York

Charles

tons

particular have been very
gratifying.
Supplying diversification to the

own

Badische Anilin

New

un-

g round

e r

w

a

item in

which

Members

a

been achieved

com¬

from the

Trading Markets for

stations, WMPS in Memphis and

Hoechster Farben

Farben

part-

a

will,

field.

cough
especially
for

pany's research. Just

CRAIGIE&CO;

all

drop solution and

children also

F. W.

-over

complete

and its.

particular

designed

syrup

leads

brand

in

l

for additional costs is to be added

era

successful

profits.'

infants,

S

Bankers

Broadway,N.Y.6 COrtlandt7-5680

Audubon Park Raceway

history. A This will permit the

Plough pioneered flavored aspirin
for

1897

Tokyo—70 Branches
Investment

out¬

long .and

.its

now con-■

:to

&

Under this contract, an allowance

new

operation

substantially

Brokers

May 30, 1953, calls for the de-

on

d

tribute

VIRGINIA—WEST VIRGINIA

Home Office

111

Co., Ltd.

Established

'

directors

of the

in

a

name

products that

;

pounds
of' nickel
and
100,000
pounds of refined copper by 1958.

.

number of

and

23%

Nickel "Company
Ltd... (INCO), one of
the great mining enterprises in
Canada, appears to be entering

Canada,

The
company's
research de^
partment' has come up with a''

Since 1932

it

V

and

Company.

than

write

Securities

a

r

Exchange

operation to

brand

consider

convinced

standing 500,000 shares. All key
employees, department heads, etc.,
are
stockholders
and
a
newly
created stock purchase plan has
resulted in many other employees
acquiring shares.

min¬
oil, from Esso Standard Oil
selling

Mistol,

not

unless

Officers

more

or

Yamaichi

Management is

drop, and Nujol, the world's'

largest

Call

increased

foreSeeable conditions,
very stockholder

any

ground

nose

of

COuld be maintained under almost

surfacer partunderground

sell

and

manufacture

,

rights

all

purchased

Plough

with knowledge
Japanese potential.

investors

King & Co., New York City

International

of

Ever-Ready *
Early i this year.:

others.

and

may have unusual appeal
investors with vision—

reason

been

would

rate

offices

is

years

spect- and

International Nickel Company of Canada, Ltd.

Rub and Nose Drops,
Oil

not

branch

our

to

next

share. In
the

a

to

SECURITIES
J.

that Plough
management
has
always - been
highly conservative in this re¬

Also" American Stock

flavored aspirin for,

a

early

N. Y.

NY 1-1557

JAPANESE

Toronto, Montreal and Canadian Stock Exchanges

Mexana Skin Cream'
Medicated Powder, Penetrol

and

Lynchburg, Va.

drugstores

made by this
Joseph Aspirin

items
are St.

company

and
the

line

-

Among the 75 or so

America.

packaged

Commonwealth Natural Gas

Tele. LY 62

necessities

shelves of most of the

Alabama-Tennessee Natural
Gas

cosmetics

drugs,

household

increase

has

recent

match it.

Trading Markets

a

Exchange

La. - Birmingham, Ala.
Mobile, Ala.

-

;

Direct wires

CHARLES KING

\

In my opinion
rather
than
popularity will find few
equities
in
today's ' market
to

American Furniture Compahy

HAnover 2-0700

the trend of earn¬
generation, there
good possibility oi

to $0.75 or $0.80
opinion the only

dividend

other companies. Management ex¬

buy" value

who

investors

2-7815

advertising

present

of

selling

registered in 1946.

BROADWAY, NEW YORK 5

in .three

come

(2) development of new products
through research; and
(3) ac-

currently

Exchange

REctor

for

York

New

Members

TEL.

dividend

annual

in

to

iffiPONNELL & CO.
Stock

exceededthis

slightly

be

Plough

120

Last

Because of a good cash posi¬
and
heavy cash flow the

be

York Stock

'

23 .years
of $1.30 a share

will

i

American

x

and

year.

$0.60

could

It

mate¬

be

to

dividend

a

Exchange

Stock

New Orleans,

,

for
year's earnings

Since 1917.

even

an

increase

(1) 'aggressive

ways:

JLAOUg*a6

*#<A*ne5

1Y,

terruption

Rights & Scrip

New

rialize?

have

been

without

in

upon

and /cash

seems

.

sales

this

Will

dends

Specialists in

ings

likpW,

seems

result

will

sales

of

Divi¬

1918.

in

It

expenses.

Based

over¬

American

19 Rector St., New York 6,

year's net and only 29:7% of cash
flow (earnings plus depreciation)

larger expansion, percentagewise,
in profits.
•
5

adopted

was

Francisco

costs and

labor

in

volume

sales

.

Stock

York

New

Members

a

then, that a substantial, expansion

organization

Cleveland, Dallas,
Hartford, Houston, Philadelphia,

Members

______

little
additional
and only a small

outlay

increase

corporate
form
of

Boston, Chicago,

Providence, Portland, Me., San

caoital

head

in

increase

require

a

any

and

products

new

would

since the

year

Liberty Building

Direct Private

at

Steiner,Rouse&Co.

ioiK City.

expenses,

selfimposed
stringent
depreciation by $0.05 to $0.10 despite an inpolicy
prevented
the resulting crease in depreciation charges to
manufacturing
economies
from $0.90 a share from $0.72 in 1953.
being translated immediately into (Plough probably uses higher dea
sharp jump in profits.
preciation rates than any of its
With an eye to future expanpublicly-owned competitors.) The
sion the plant was built with sur- $0.60 annual dividend represents plus capacity. Therefore "i,a sub- a payout of only 46.2% of last
with

stantial

op-

deficit in

PHILADELPHIA OFFICE:
Lincoln

Inc

Street

State

84

1946.

not

has

Teletype NY 1 -40

OFFICE:

100%

•.

Plough,

1920

Broadway, New

WOrth 4-2300

al-

of

most*

Member

Associate

American

year

means

gain

a

Corporation

1954, the ninth
they have in¬

This

creased.

New York Hanseatic

are

for

consecutive

drug manu¬
estimated at

plant

new

Start-up

Charles King & Co., New
(Page z)

ner,

in Memphis.
heavy adver¬
tising expenditures in connection
large

a

Plough, Inc.

BOUGHT—SOLD—QUOTED

—

eight scattered

from

Security Analyst,
Clark, Landstreet & Kirkpatrick, Inc.,
Nashville, Tenn.

Bought—Sold—Quoted

International Nickel Co. of Canada Ltd.
Charles King, Part¬
buildings to
* " '
— 1 ™-

operations were moved

1951

In

N. JAMES DOUGLAS

vJxe, Tenn. (Page 2)

discussed.)

offer to sell the securities

Louisiana Securities

Douglas,

james

Security Ana yst, -Clark Landstreet 6c Kirkpa rick, Inc., Nasa-

intended to be, nor

(The articles contained in this forum are not

Philips

Alabama &

Selections

Inc.—N.

Plough,

particular security.

a

Participants and

Forum

A continuous forum in which, each

Unilever N. V.

Week's

This

^'Vo^^ijSeciirity^:Uce^Best

Brokers, Dealers

For Banks,

.

,1

National Quotation Bureau
Incorporated

46 Front Street

New York 4, N.Y.

Volume 180

Number 5380

Commercial and Financial Chronicle
The

...

The Muke! Ahead

INDEX

Members

Articles and News

Paine, Webber, Jackson & Curtis

Y.

N.

Stock

Exchange

—John R. White

.

Doctors

and

great

deal

thing,

we

in

analysts

have
For

common, *

both

*

(2)

a

you of the human
.the nation's fi¬

body

created.

the

Secondly, like
medicine, an¬

masses

the qualitative

home

factors

spells

than

'ant

be

can

self"

import-

more

the

factors. Third.

B.

Sidney

Lurie

stabilizing

con¬

exist

intuitive

obvious

you'll

that

it

I'm

sure

takes

more

doctor, that

Recent weeks have demonstrated
soundness

of

*

in

are

and these are

ties.",

amazing

an

comes

it

words,

to make

For

iact,;

takes

creative

is

This is

(4)

extremely healthy patient who is
quickly
tions.

able to throw off infec¬
Our secret weapon — our

;

miracle

new,

fact

that

antibioticis the

this

is

New

a

A

Era.

healthier and stronger America—
and

stock market—than

not.

fore

has

examine

4

into

come

the

(1) Population

third

since

ously

1929—and

bigger

means

industry to

or

by

this

one-

obvi¬

for

markets

The 11 million

serve.

population gain since 1950 spells
a
new
market bigger than the
State

of

of

time

war

the

The

California..

best

is

come—for the full impact

yet to

late

births

1950's

will

and

come

early

in

lS-30's.

Equally important, our population
■complexion is changing with a
larger
labor

of

percentage

oldsters.

and

market.

tional shift to

youngsters
a tight

This spells

Further,

has

the

na¬

areas

additional
*■

*A talk

of
new

country

opens

markets.

Foreign Trade Convention

—Howard C.

Sheperd

18

Commerce-Labor Departments

a

V

Transitions

V

of managed

Conditions

*

>

of

means

"J'.,/,
'As We

'

higher "normal" of deturned

the busi-

"depression."
We've seen piece
individual industry readjustments—but not on an all-em¬

mendous

business

occuring

throughout

recovery

the

Note the bull markets in

stocks. '

Does

gests that the factors which

Continued

on

con-

page

29

-

:_Cover

Bookshelf

Glens Falls

*




•

Nashville

•

Schenectady

•

4

40

Exchange PL, N. %

Teletype NY 1-1825 8c NY

1-1826

27

:

48
8

J:

Your

RED

39

Funds

—4

g

Bankers!

Our

Reporter

Governments

Reporter's

Public

on

Report

Utility

Railroad

8

Securities

Prospective
Securities

in

Security

..

and

.

28

You—By Wallace Streete

Security I Like Best
State of Trade and Industry,

2

SULPHUR
.

43

Copyright

Reg. U. S. Patent Office

York
to

7,

Reentered

~

N.

DANA

Thursday

vertising

issue)

and

issue

statistical

records,

corporation

and

Worcester
Other

Chicago

(general

city

news,

Offices:

3,

111.

135

Monday

every
—

Pan-American

bank

Canada,

(com¬

La

STate

Salle

St.,
2-0613);

matter Febru¬

Preferred

&

Common

$48.00

$55.00

WM V. FRANKEL & CO.

Rates

per

$51.00
per

year;

per

S.
in

year.

year.

rate

account

of

the

fluctuations

of

In

exchange, remittances for for¬
eign subscriptions and advertisements must
be

made

in

New

York

funds

39 BROADWAY, NEW YORK 6
WHitehall

3-3960

Teletype NY 1-4040 & 4041

Publication

Bank and Quotation Record —
Monthly,
$33.00 per year. (Foreign postage extra.)

Note—On

INCORPORATED

of

„

the

South

Countries,
Other

clearings,

etc.).

(Telephone

Union,

of

ad¬

market quotation

news,

second-class

Dominion
Other

and

as

Subscription

President

news

REEVES-ELY LAB. INC.

by William B. Dana

Subscriptions in United Statea, U.
Possessions, Territories and Members

Thursday November 25, 1954
Every

Eng¬

25,

Y.

9576

SEIBERT,

C.,

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

HERBERT D. SEIBERT, Editor & Publisher
WILLIAM

E.

Company

COMPANY, Publishers

New

2-9570

1954

PAN AMERICAN
SULPHUR CO.

1 Drapers' Gardens,
London,
land, c/o Edwards & Smith.

FINANCIAL CHRONICLE

Place,

4

—j-

Washington and You

REctor

LITHIUM CORP.

16

MEXICAN GULF

The

Park

Common

45

Corner

PROCESS

CORP.

44

Offerings

The

DANA

HOUDRY

36

Registration

Salesman's

The Market

GULF SULPHUR CORP.

23

Securities

Securities Now

-

I

29

Our

■

must carry on

24
5

,

'

CROSS

34

May

state

Manchester, N. H.

more

securities

25

Wilfred

plete

Chicago

•

.

Observations—A.

ST., NEW YORK 4, N. Y.
TELETYPE N. Y. 1-5

*

&; J^ACKIE, Inc.
HAjj-0270

ary

•

trading markets in

over-the-counter

Bean

f- ^-\ I •• %".•

o

Stocks.—_L_-__^__2_1'_J

News About Banks and

PREFERRED STOCKS

Members New York Stock Exchange

250

*

NSTA Notes

this

bought
To generalize, the price rise

•:

/

(Editorial)-

Insurance

and

Mutual

-

England

be

maintain

than

:

r-

Indications of Current Business Activity___'___

saying that it's been unrealistic
should

;

.7v

Dealer-Broker Investment Recommendations.

This background is another way
own

We

(

and Western Germany.

stocks

>Y-/"

From Washington Ahead of the News—Carlisle
Bargeron—_- 21

now

world.

-

Regular Features

;

Business Man's

;

meal,

bracing downward spiral.
In my
opinion, we do not face another
1929—partly because of the tre¬

Seei It

.

A.

Einzig—"U. S. Election Results and Sterling Convertibility"— 26

declines of the post-war years ;
into
"recessions"
rather
than
a

TELEPHONE HAnover 24300

21

■}; Coming. Events in the Investment Field

"

ness

now?

*

*'

___

.

Bank

.

high*

Norm

" r
t

V

v

the

this

New

mand which has

to

T

-Changed

«.4

•'.*

,

in the

as;

M

NOT

*

}

vested inter¬

a

Angeles

15

Why Must Government-Undertake It? (Boxed28

well-being, and is /

has

Los

:

\

Cheap and -Easy Money to Continue, Says Eliot Janeway____ 23

j-

Net of the foregoing is that there

of

7

—

Credit and Debt .Managing Policies Under
,

,■

one

A

new

!

G. Rowland Collins-Marcus Nadler Study Foresees Revised

whole

aggressive interest

world; and
expenditures.

a

in

Survey-—

J. Stewart Baker Terms Past Year Period of Successful 1

•

-

Boston

A Direct Wire to

fewel & co.

stepped

Spencer Trask & Co.
*

of

business.

Announcing

New Construction in 1955 Set at $39.5 Billion in

£5

Albany

£3,104,687

exchange

5

America's Stake in World Trade—Hobart C.
Ramsey;

WILLIAM B.

BROAD

and

16

Published Twice Weekly

25

_f2,851,562
1

also undertaken

i:

The COMMERCIAL and

specialized in

Ftind__l

Trusteeships and Executorships

New Opportunities for a Liberal Foreign Trade Policy
—Allan Sproul

was
on

maintaining prosperity and

1954.

For many years we

Protectorate.

Capital

Cover

,___

since September 1953 in itself sug¬

by Mr. Lurie before the North

have

Authorized Capital. ___£4,562,500

Toward New Patterns in World Trade

In effect, the Administra- *
power

Share Medical Society, Lynn, Mass., Nov.

10,

27

Trade Assistance Program of the Export-Import Bank
—Hawthorne Arey
c.

prod- I

new

The

era

the

the suburbs and to

the

in¬

where the Govern-

an

become

mean

new

At The National

not

important
contributors.
Economically and,
militarily, the United States today .
is the. most important nation in ,

is

grown

people,

in

Bishopsgate,

26

Banks—Alfred J. Casazza 22

banking
.

-

Let's

why.

has

million

40

some

being.

reasons

is
;

passive: observer

a

be¬

ever

an

the nation's

est in;

an

did

has. been

economy—one

And

likei

Government

26,

West End
(London)
Branch:
13, St. James's Square, S. W. 1.
Branches in India, Pakistan, Ceylon,
Burma, Aden, Kenya, Tanganyika,
Uganda, Zanzibar, and Somali-

-

*

1920's.

period. <.1954

Office:

London, E. C. 2.
20

.___

Situation—Roger W. Babson_____!

a

was

miss" basis and

or

cycle

tip.

developed without" the resiliency
tion in
which is a special* characteristic
this

that

new markets
via
research.

ucts

it no

scramble for stocks could nbt have

injects

—

management

key to

ex¬

be¬

market trend.

a new

the

to

Kenya Colony and Uganda
Head

The Bank conducts every description

scale.
Now,
every
well
managed company knows that the

surprise

a

element

ment takes

:

Bankers

land

rather than scientific. For

"hit

a

the rewards only go to the risk;
in
takers.
But the fclost-election

of

of INDIA, LIMITED

14

.Prospects Regarding the Railroads-r-J. Elmer Monroe

small

longer has market significance. In
other

The Agricultural

accentuated
a
business
Now, however, capi- '
expenditures are planned on a

on

mar¬

uncertainty

an

established

an

13

____,

in in¬

Secondly, in the past, research

era

ket rallied after elections reflects
other fundamentals, too.
once

NATIONAL BANE

nores

the "Fabulous Fif¬

True, the fact that the

ample,

♦

long range basis which almost ig¬
short-term business changes.

important

an

fundamental which is often Over*we

1

12

Wyckoff-1

1

__

A Common Stock Fund for Savings

%

downtrend.
tal

looked:

Salute to the Chronicle"—Hubert F. Atwater--.-___

—Lewis P. Mansfield

thereby

is infal¬

no one

lible.

the

Risks

Gold, Money and Men: A Plea for the Gold Standard

example: In the past, capital ex¬
penditures were cutback sharply *
whenever
profits
declined
and"

than academic proficiency to be a
good

-

STREET, NEW YORK

Telephone: WHitehall 4-6551

<

Nojicalculated

Reserve

manager

when

tuitive

sense—than

yardsticks.

agree

-,

development of the

professional

clusion depends more on judgment

the

Obsolete Securities Dept.
99 WALL

10

Paid-Up

generation

new

dustry— the

the proper an¬

or

The

(3)

ity to arrive at

*—"feel"

Some

in

Unload them

on US. ; \

9y

i*

and

"turkeys"

some

strong box?

Boatwright _______U 11

-travel—which in

more

••

gasoline, tires, etc.

ly, as in medi¬
cine, the abil¬

alytical

spells

Outlook

j

Stuck with
your

Industry

States Collect More Taxes in 1954—V. J.

intensifies the need for cars,"

turn

Zelomek

W.

•

Accounting and Securities Regulation—Ralph H. Demmler—
"A

tremendous "do-it-yourThe shorter work

a

Demand for Equities

L

before

ever

LEFT-OVER TURKEYS

;

market.

week

quantitative

than

and Individual

Bogen

—John W.

—

owners

I.

Outlook—Harry A. Bullis___—

The Economic Outlook for the Textile

upgrading has been
by new leisure for
better and higher
standards of living.
To illustrate
the impact of these changes, more

where

one

—

—Jules

income

the

science

exact

The Institutional

the

are

SELL US YOUR

3

*

_-

j_:

4

1929 and*.- .••'.—A.

"rich"

...Cover

_

Lurie

6

"middle class",:
Petroleum

new

4

Ahead—Sidney B.

AND COMPANY

-

.

The Election and the Business

accompanied

in¬

an

Market

r

Moiy's Minerals—Ira U. Cobleigh____

has

income

since

Today's

The

people who proportionately spend ?
the most of their income. Further, i

nancial health.

alysis is

tremendous

a

of

we

—

national

redistributed

been

one

diagnosticians;

are

Our

Page

Impact of Government's Role in the Housing: Market-

Analyst offers as elements of New Era America and stock''
market: population growth; redistribution of income to newji
middle class; scientific management, and intensified govern-'/
ment intervention.
Expects 1955 business to be better than:
now
expected. As favorably siluated industries, Mr. Lurie
l. suggests steel, building, textile, and some specialties.

LiCHTEnsifin

B. S.

By SIDNEY B. LURIE*
Industrial and Market Analyst,

3

(2139)

.

.

Direct Wire to

PLEDGER

&

COMPANY, INC.

LOS ANGELES

,

'

I

\

4

\

(2140)

The Commercial and Financial Chronicle

sibilities?"

interesting
southwest

Enterprise Economist

acquired

with rather

tradi¬

a

performance of its shares on the
American Stock Exchange is Mo-

OKa.

quoting the definition of Mr. Marx
Hirsch,
President,
and
Board
Chairman, of MOLY: "Rare Earths
are

mixture of 15 metals which

a

Corporation
of

lanthanum."

uuenum

y

America,

known
board

to

s

MOLY. The

eculati

p

nature

this

of

equity

ve

bo
by

may

illustrated
the

that

fact

MOLY has, in
the

past

ade,

sold

low
Ira

U. Cobieigh

It's

Now

now.

don't

as

and

6

as

high

as

dec¬

80.

as

40

right

misunderstand

me—there's

nothing wrong with
volatility in a marketable
security, and mineral and metal
little

a

have

issues

historically proved
quite sensitive to the finding, or

absence of, major new ore bodies
or
mineralized areas; and to the

development of
So

processes.

metallurgical

new

has

it

been

with

MOLY; but right now there are
some quite dramatic company de¬
velopments which, it would seem,
market

followers

should

be

in¬

formed about. We'll take them up,
as
in the "dramatic personae" of

playbill—that

a

is,

in

of their appearance.

the

order

•

-

first became
back in

interested in Rare Earths

but

1916;

room

"aficionados"
as

occur

MOLY

they
they

lived

to their

up

indeed rare
remote, found mostly in the

billing
and

—

were

Monazite
India.

1951

In

Brazil

and

company

lo¬

of

sands

the

cated this

in that field it ranks second in the

largest

.American

It is also the

"Now," you say, "MOLY has
Rare Earths, but what are they
used for?" Well, probably you've
of

hundreds

them

used

of

processor

yourself, for they're an indispens¬
able element (Misch metal) in the
flint in your cigaret

lighter. More
important, however, is their proc¬
essing (under MOLY patents) into
Rare Earths Compound, a valu¬
able

additive

to

kinds

most

of

steel.

They increase workability,
and fluidity and lower the sul¬
phur content in steel. While first
used to improve the roll and re¬
duce

imperfections in Stainless
Steel, Rare Earths Compounds are
now being applied to lower priced
alloy and carbon steel with notice¬
success.

It has been estimated

that

40,000,000 tons of the steel
being
produced
annually,
by
the addition of IV2 to 2 pounds of
Compound per ton. To enter this

would derive economic benefit

vast

market, MOLY reduced the
price of its Compound from $3 to

certain kinds of

$1.50 per pound last January, and
down to $1 a pound quite recently.

Both of these

items,

as

doubtless know, are vital in¬
gredients in the manufacture of

steel; and,

as al¬
qualities of
strength, resistance and durabil¬
ity. In the main MOLY has been

loys,

add special

Sales

have

ingly,

and

advanced

for

correspond¬
Rare Earths

1955

should open up new and extensive
vistas for enlarged
profit.
The

a
processor, getting its raw ores
from others and turning out
tung¬

company possesses a

sten

of

and

plants
Pa.

molybdenum alloys at
Washington and York,

in

Production

alloys

has

principal

and

been

source

sale

the

of these

traditional

of company earn¬

ings but in the past three years
something new has been added-^
a

fabulous Rare Earths mine.
Most
people
don't
have

slightest
are,'

idea

what

we'd

so

better

the

research, increased

ceptance
and
is

by
stepped

some

cant

this

reason

steel industry,
production,; there

to

per

expect signifi¬
share net from

Whenever mineral

terprises

ac¬

the
up

gains in
division.

the

by

are

metal

in

ton

always asks, "Does the
company have any uranium pos-

Ten New York investment
houses, led by First Boston Cor¬
poration, in association with number of Oklahoma firms, to

A

nationwide underwriting

nationwide

group

has

been

group. Information meetings
Chicago and New York City.

underwriting

formed

to

offer

approximately $214,000,000 turn¬
pike revenue bonds of the Okla¬
homa Turnpike
Authority, matur¬
ing serially from 1962 to 1993.
The
contemplated offering, ex¬
pected to be made around Dec. 8,
will comprise three
separate bond
issues

to

provide

construction
toll

of

a

funds
like

in

aggregating
length.

The issues consist of
of

bonds

the

number

roads

miles

for

of

300

over

$68,000,000

for

the
Northeastern
Turnpike extending from a point
near

souri

Tulsa to the
State

Oklahoma-Mis¬

line

terminus

of

Turnpike

So
at

you

the

existing

Turner

Wichita, Kansas.

Ten

New

York

investment

houses, in association with

a num¬

firms, will joint¬
ly manage the underwriting group.
Information meetings in con¬

nection with the proposed financ¬

will

be

Nov. 29 at

held

10:30

in

a.m.

Chicago
at

point

the

near

Oklahoma

Oklahoma-Texas

City

State

stock

entry into atomic materials
through an established company,

MOLY

near
Wichita Falls, Texas; and
$63,000,000 of bonds for the North¬

in the Great Hall of the Chamber

Commerce Building.
New York managers of the

ern

Turnpike extending from the




man,

Dillon

Sachs

&

B. J. Van

begin,

can

of

Weld & Co.

to

last

speckled

with

radioactive
On

the

but the

mineralized
is

ores

mean

no

and
asset.

corporate and financial

side, Molybdenum is an old and
respected company (incorporated
in Delaware in 1920). Its talented
management is
headed
by the
aforementioned Mr. Hirsch. Mines
and

claims

in

New

Mexico,
Colorado, Utah and California as
well

in

as

denum

are

Canada

reserves

around

13

million

servatively stated

molyb¬

tons

All these assets

ore.

and

estimated

are

are

on

at

of

5%

most

con¬

the balance

sheet.
Sales

for

1954

should

be

the

Four per

claims in

the week

6% lower than
In the
r

a

was

period ended Nov. 13, idle workers'

less pay dropped to
247,100, off
The total compared with a 1954

Jan. 9.

1940, with the current rate,
paid in 1952 and 1953, There

$1,
was

10% stock dividend in 1951.
Balance

sheet

A year earlier

bank

loans

due

listed

Exchange,
amount

1955-7.

Common

American

on

outstanding in
of 637,523 shares.

For those

attractive

the

dividend

yield,
and
market stability, MOLY will hard¬
ly fill the bill. But for the pa¬
tient, and the
somewhat
more
speculatively minded, Molybde¬

Corporation stock holds

sten,

molybdenum

of

Earths

con¬

standard

and

more

come

extended

in

California, and radio¬
active ores at OKa, broaden the
horizons for future earnings, and
bullish

cancellation

and

word.

Continuing, it notes strong
nearly all finished steel products.
The

manifestation

in

factured

from steel.

Plate

sales

are

already selling

SAN

to

The

Financial

Chronicle)

FRANCISCO,
Kyle

and

Calif.—

James

L.

Os¬

un¬

borne, Jr. have become associated
with H. L. Jamieson Co.,

Building.
divisional
Ore.

for

Inc., Russ

Mr. Kyle

was

manager

in

Eugene,

Services.

Mr.

Diversified

Osborne

was

with

•

construction

very

well, is moving

extended delivery.

on more

production
\

gear

,

Strong appetite for steel in the Chicago area is being reflected
from many sources, this trade
authority asserts. Farm equipment
buying is much stronger than had been anticipated. So is demand
appliance manufacturers and stampers.
Automotive steel

from

is also

going like hotcakes in this

area.

Neither steel^producers nor very large consumers
appear to
be worried about a shortage of cold-rolled sheets.
But their con¬
fidence is not reflected
who

by medium-sized and small consumers
attempting to place orders far in advance of actual needs.

are

Mills

Rave adopted

books to take

informal system

an

of

allocating sheets

In many cases space is being held open on the
care of large customers whose needs can be

fairly welT anticipated although they are relatively slow in mak¬
ing firm commitments for tonnage, concludes "The Iron Age."
Domestic
week

13

as

vehicle
car

production

makers

and

reached

nine

truck

65-week

a

builders

peak

boosted

last
pro¬

gramming.
"Ward's Automotive Reports" estimated the Nov. 15-20 turn¬
out at

152,886

cars

and trucks

or

11%

than in the previous

more

work period of

137,781 units and 47% above the
ago of 104,231 units.
turn

week

same

a

year

The statistical agency noted that it was the
fifth-straight up¬
in weekly car and truck volumes and marked the best in¬
week of Aug.

and trucks were built.

This week's total will show

to

Thanksgiving.
after the holiday.
The

strongest

Most

producers

22, 1953, when 155,722 cars

will

in

be

a

action

decline due

the

Friday
-

in assembly last week was at Ford
Motor Co. as all plants scheduled
Saturday work. Ford Division
was looking for a new
postwar high in weekly car volume, reflect¬
upsurge

ing the end of changeover problems and
the battle for production and sales.

renewed

emphasis

on

♦Elsewhere, states "Ward's," various Chrysler Divisions, Studebaker and

were

and

was

new

some General Motors plants
Saturday stints. Plymouth output
high for the year the past week.

turned

to

production last week.

all week.
The

putting in overtime
expected

to reach a
In addition, Packard re¬

Hudson and Kaiser

were

down

.

heavy schedules at Ford, it states,

of the week's car

previous.
for 50.3%

volume, against

a

gave the company
25.6% share the week

All other manufacturers took smaller slices of industry
of

programs.

General Motors accounted

production last week, Chrysler Corp. 17.4% and
Independents 3.8%.
car

Car assembly was up 12% last week from
while truck erecting also showed a 6% rise.

the week earlier,

However, to date in 1954 car and truck totals are down 17.1%
16.6%, respectively, from a year ago. United States factories
have turned out approximately 4,698,157 cars and 904,603 trucks
this year, compared to 5,666,719 and 1,084,754 in the same span

and

of 1953.

Canadian

plants showed a 24% gain in vehicle construction
an estimated 4,195 cars and trucks were built,

the past week as

against 3,373

a

week ago.

October witnessed the

:

launching of 9,852

new

stock

corpora-

:
.

,

the

.

Lo

Reynolds & Co.

-

.

strong lift from

companies

formerly

Investors

a

schedules up to record levels for November and December.

the

Jamieson Adds Two

Im¬

bars.

Hotbeds of demand, it declares, are along the
great steel con¬
suming axis of Chicago-Detroit. Automotive firms are spurring
demand in the Detroit area as auto

scheduling, despite increased

be trans¬

lated into shareholder benefits.

(Special

carbon

equipment industry which is looking ahead to highway construc¬
tion needs for next
year, while woven wire fabric, which was

to observe how

may

hot-rolled

.

getting

28.5%

an

they

is indicated by recent

recovery

for

a forgotten
being felt in

now

been lag¬
ging badly and it is widely used in many types of products manu¬

unusually assorted
variety, and it will be interesting

in

is

provement in this product is important because it had

share prices. MOLY's Minerals are

present

is practically

recovery

far-reaching extent of the

sharp improvement in demand

tung¬

expand; while the newer
corporate activity, Rare

can

fields

The

274,000.

it has at any

dustry output since the

share buyers seeking

allure.

claims amounted to

time
during the past year, states "The Iron Age," national metalworking weekly. Setting forth its basis for this contention, it points
out that the industry is
operating at 80% of rated capacity; new
orders are coming in at an
extremely fast clip; order backlogs
are growing
rapidly, causing deliveries on most products to be¬

Stock

is

new

claims for job¬

new

19,300 from the preceding week.
high of 468,800 in the week ended

Steel business looks better this week than

(1953

year-end)
showed net working capital of $4
million, and $600,000 in serial

Initial

by about 11,000 per¬
4% higher than the preceding week but

year ago.

to their customers.

$1.16 earned in ,1953.. Dividends
have been paid in each year since

than 23,000 per¬

ended Nov. 6 increased

and the total

sons,

order

and
net per
share
should record some gain over the

nation's insured workers,

in this category. * Continued claims for such bene-

largest in company history, cross¬
ing the $24 million mark for the

time;

cent of the

j

unemploy¬

with the total being 2% lower than the prior week.

sons,

whole crater

a

'

-

general improvement in reports on

a

week.

than 7%

more

offer.

valuation

accurate

or

bodies calculated;

ore.

&

Lehman

something

possession of

James

Co.;Goldman,
Brothers;
Ingen & Co., Inc.; Whiter
Co.;

has

Much development work needs to
be done here before production

lower.

was

slightly fewer than a month ago, were receiving unemployment
benefits; Kentucky and West Virginia were the only states having

the Con¬

derwriting group are: The First
Boston Corporation; Drexel &
Co.;
Glore, Forgan & Co.; Shields &
to Company; Allen & Company; East¬

line

some

on

tinental Illinois Bank and in New
York City at 2 p.m. on Nov. 30
of

look

you

quite
dramatic future prospects in these
Canadian holdings.
If you seek

suggest

ber of Oklahoma

ing

way

noted in the Fall recovery in total industrial

fits in the week ended Oct. 30 dropped by more

ox¬

Labrador.

any

it, Molybdenum has

output,

Oklahoma City to
Oklahoma-Kansas State line

near

see

siderable

near

the

columbium—tantalum

mills than

steel

num

near
Joplin, Mo.;
$83,000,000 of bonds for the South¬
western Turnpike
extending from
a

•

en¬

discussed these days,

$214 Million Oklahoma Turnpike Bonds
Scheduled lo Be Offered About Oec. 8

to be held in

ment

down,

millions of tons of good grade iron
ore—and it's much handier to the

stock,

manage

continues

ore

*

Business Failures

.u

There

surface,

smaller mill to process them. This

a

or

someone

explain

the

was

first

huge deposit
material, and with

base

continued

Earths

Rare

about 1%

was

in some tests,
to 350 feet.
Some samples have
suggested a realization of $25 per

times

you

tungsten.

from

slight gain

acreage also is believed to contain

how

United States today.

mineralized

Industry

production in the period ended on Wednesday of last week. How¬
ever, compared with the similar period a year ago total output

first, and more recently diamond
drilling, have disclosed extensive

.

i-

J
A

way, and 7,000 feet transversely.
This whole area virtually vibrates
with radioactivity.
Trenching at

occurences
of uranium, thorium,
columbium, tantalum and iron.
Drilling has further indicated that

Index

Price

Auto Production

and

place.) Geological prob¬
ing reveals that, within this swath
of land, there lies an old volcano
crater, about 20,000 feet across one

producing three billion pounds of
Rare Earths Compounds.

of

It still is and

Food

named

cheese

a

ide, and the company is continu¬
ing its exploration for enriched
areas—ores that might run up to
$75 a ton, and thus require a much

able

ores.

(There's

Trade

Commodity Price Index

section called

a

Output

Retail

State of Trade

8,000

about

on

in

Production

Electric

Carloadings

year,

magic stuff at Mountain
Pass, California. It acquired ex¬
tensive property there which has
proved to be the largest source of
Rare Earths anywhere, with esti¬
mated reserve tonnages capable of

Originally, as its poly-syllabic
name
indicates, it was a processor
molybdenum

acres

this

after this

together in nature, the most
common of these being cerium and

x

options

Steel

The

MOLY

Montreal,

land and has,

additional

Molybdenum Corporation of America; with some related
notes on rare earths and radioactivity.

A company

of

owns some

processing and extraction activities

tion for the wide range of market

if

at that. Near the
River, about 43 miles

ones

St. Lawrence

By IRA U. COBLEIGH

of

Molybdenum

Corporation does—and some very

Moly's Minerals
A swift look at the mineral

Well,

Thursday, November 25,1954

...

.

Continued

on

page

33

Volume 180

Number 5380

.

.

(2141)

5

changing again.

In

The Commercial and Financial Chronicle

.

f-'
,

t

naturally

Toward New Patterns

the

In World Trade

•

•

CORPORATE DEMOCRACY IN ACTION
•

•

'/

Prominent New York banker points out recent

Wooing the Montgomery Ward Stockholder

68,000 far flung Montgomery Ward stockholders will
shortly be promised by the insurgent Louis Wolfson that success

t

in his battle for management control would bring

them such ad¬
three-for-one stock split; segre¬
gation
of
the
company's
land,
buildings,
fixtures and equipment, at their depreciated
value of $32 million, plus $18 million cash, and
its spin-off from the parent company which
would hold the large liquid assets and enter

vantages as: bigger dividends;

%

-Jf [

u;into leases yielding the spun-off unit from 10

'

to 15%;

merchandising" revival, With the open¬
ing of at least 25 new stores annually and the
not far distant doubling of sales volume; with
the established availability of a $200 million
borrowing line from an insurance company,

J

M
-

/

"

pansion.

;

thinking about

In

.

,

..

larger and

of

a

more

X:']'"-j

heard

In

the

of

field holding an aggregate of 200,000 shares—both
acting on the "plague-on-both-your-houses" principle.

these

For

good measure, Hanns Dittisheim has in some press quarters
falsely credited with heading still another group representing
Important foreign interests (actually non-existent).
been

'

Such

facets

some

are

the

of

the shareholder
corporate democracy at

impact

emanating

from present-day American
work, in its attempt to unearth value.

upon

Toward

the

Fund's

troubles and diffi-

;.

Credit

culties.
and

exchange

problems, import controls,
prohibitions and regula-

quotas,
tions

ad

infinitum plague you as
always. Over and above these
familiar, burdens, you are facing
more

competition

from

Western

now

that they

European countries,
finished

have

their

major recon¬
struction jobs and increased their
capacity to export. In certain of
the problem areas of the wo|:ld,
the past year seems to have
one
of retrogression rather

wv-

the

home

been
than

impression

troublesome

problems

The fact is that

v77olitJ
that only
,

ahead.

lie

some very

encour¬

meeting next April to elaborate its specific plans. Along
with the promise of higher dividends, popular, according to tne

aging

mail

about the current world trade sit¬

must

the

coming in from the smaller stockholders,
come
information about the identity cf

new

well

as

the

the

of

use

present

excess

of

working

many

are

in,

we

shall find

the

policy given to this writer by Harry

Corporate Controversy

(excepting where dishonesty may be involved). This
embracing the "if you don't like it, sell your stock"
philosophy, seems to be prompted mainly by the following factors:
(1) Distaste for displeasing their Fund's shareholders who
may disagree with their judgment; (2) The possibility of their
judgment being proved wrong; (3) Inadvisability of antagonizing
troversy

attitude,

sources

of information:

and. impor¬

tantly though little realized (4) Fear of the provision of the In¬
vestment

Companies

Act

of concentration

authorized

.

.

to make

.

concentration of

companies

in

from time to

of

which

1940,*

of economic
an

which

investment

raise

that

"The Commission is

investigation of

control of wealth

to

seems

power:

and

companies

.

.

.

the effects of

industry, and

are

interested,

on

and

time to report the results of its studies and investi¬

gations and its recommendations to the Congress."
This provision in the statute seems to many trust managers to
indicate that prudence would

dictate that to avoid the possibility
over corporate affairs by a few
powerful fund officials, they desist from taking positive public
Stands on management questions.
of accusations of undue influence

Thus,

we

see

that considerations over!

a

corporate policy get explored in the wake of
matter how

narrow

wide area of
contest, no
seem to be!




Act, Sec.

14

(b).

goods and other

consumer

chandise when their

.

proxy

met4

products

own

just after the

war,

and the

is probably true of

same

has improved*

largely by

on

trade

in

there is such

a

thing

"normal"

as a

pattern of international trade, or
that we shall ever return closely

growth

economy.

volume of world trade rose again

for

during the latter half of 1953. This

Latin America have become more

was

of

result

a

West

the

upsurge

in

European business

activity
and occurred despite the American

industrialized.
longer

no

Their imports are

soft

preponderantly

experience the immense importance of Western Europe as a

goods but rather raw materials,
fuel,, and capital goods. At the
same
time, the exodus of laborfrom the farms to the cities has

world

reduced their exportable surpluses

recession.

We

should

learn

from

this

market, and the sustaining

effect of European recovery upon
economic

world

The

upward trend in trade has
through 1954 and, as I
mentioned before, has carried the
volume

and

probably

the value
also to new record levels, perhaps
close to $80 billion—more than V/2
times the prewar total. Participat-

this

expansion, our own
commercial exports have recov¬
ered and are now running better
ing

in

of

food

other

activity.

continued

than anyone

would have expected
from the predictions made a year
ago. What is especially significant
setback

one

noted, trade has

ex¬

and

materials.

raw

An-

Southeast Asia, has
failed to regain its prewar impor¬
tance as an exporter of industrial
area,

materials

raw

largely

because of

the difficulties brought on by po¬
litical changes and raoid pooulation

growth. The disappearance of

Eastern

behind

Europe

the

Iron

Curtain has made Western Europe

dependent for

more

foodstuffs

and

on

Hemisphere and

on

Long-Range
The

and encouraging is that, with the

materials

the

Western

Africa.

the

be

can

Shifts

Trade

ever-changing

world trade
of

raw

seen

nature. of
from

long-range

very

some

shifts—I

panded steadily since the war,
even though the recovery of pro¬
duction
in
countries has
many

would say secular
world pattern of

lessened their demand for some of

modifies. These are changes which

the
in

products

had

they

to import

the first postwar years.

Swinging

Trade

into

Back

it

has

been

has

been

also

by

corn-

The most notable has

been

the long term

over

iri

trade in textile goods and apparel.

So much for the overall

trade

trade

going on before the war and
which are now apparent once
the decline

Normal Patterns

changes—in the

were

more.

While

the healthier

changes in the world
Take Latin America,
example.
The- countries of

basic

j0r

But after iiiis-dip the value and

were

in distress.

and

drop

industries.

goods

sumer

when

producers

factors—the

a

figures.

expanding,

swinging

back

The

University of Manchester in

Great

Britain

share

of

estimates

textiles

that

and

stressing these positive points

because

I sincerely believe that
with the economic situation
improved over a large part of the
Free World—and also, let us hope,

now,

with international tensions relaxmg

somewhat—we can look for-

j^o

the

apparel

more

stable patterns less in-

conditions,
Much of the early postwar trade
was
?bnormal in character and
fjuenced bv emergency

were

freely available only in the

Hemisphere.

Western
deferred

demand

The

for

vast

consumer

goods, especially textiles, had to be

SUppiie<d in large part by the U. S.
Trade moved in a maze of currency
and

exchange restrictions.

But with recovery of production

American industry
and American exporters will have
the skill and enterprise to share

abroad and the satisfaction of de-

fully in the expansion.
Let me indicate, with
figures
lar

the

as

few

possible, how spectacu¬
recovery in
world trade

ferred

demand,

^^^^X^Xh^ccounted"
P

•

_

Continued on page 01

patterns

NOW AVAILABLE.

.

\

.

The NEWL1NG CANADIAN LETTER

been, despite political uncer¬
tainties, balance of payments
crises, currency devaluations, and

A

fortnightly review of the Canadian Securities

FREE COPY UPON

persisting trade controls.
1938,

the Free

World,

then

Markets

REQUEST

MUrray Hill 2-4545

considerably larger than it is to¬
day, exchanged something like $21
billion worth of goods.
By 1947,
.the actual volume of international
trade had recovered to around the

NEWLING & CO.
Members of the

21

♦Address

Trade
Nov.

by Mr. Sheperd at the World
Dinner of the 41st National For¬

Trade Convention, New
17,

second

which just about held its
own percentagewise, or—in other
words — expanded in
about the
same
degree as total trade. The
group

as

has

In

trade

against the relative decline

major products in this group were

of'^olTf
that is correct,

As

in these goods, there was a

Toronto Stock Exchange

very
a

its primary motivation may

Companies

producing countries,
which went in for heavy imports

dropped from 40% of total world
trade at the beginning of the century to less than 20% in 1950.
Iam not doing this just to try to
Relative declines, though not quite
make us feel good, since I realize
fiowed
through abnormal chan- so steep, also took place in r-^-vay
that many of our exporters are
nels. Fuel, food, and raw materi- equipment and materials, leather
facing very serious problems.
I
als, vitally necessary to Europe, and leather goods, and tobacco,

eign
Investment

was

decided to talk about this evening.

am

Incidentally, while most Fund managements now recognize
the obligation to vote their stock, they generally feel it best to
desist from a publicized reaction to the merits of a company con¬

management and cutting off

it

years,

pattern of trade—are what I have

the other."
and

areas

two

world

of

study all the proposals, including those that
Harry Prankard, 2nd
come
up at
the last minute—all under the
assumption that it is the fund's duty to vote their stock one way

Funds

than

postwar

traditional

These

our

The

healthier

is

earjy

moving to

intentions, or even defi¬
nitely to make up our minds until the day of
the annual meeting; until we have had time to

Some of the. raw

years.

material

^

out of the market and
only U. S. economic aid kept goods

American Business Shares, the key funds
owning the largest blocks of stock: "Our policy

postwar

by some 40%, while the

rose

virtually

of

is not to disclose

the pattern of international

trade

I. Prankard, President of Affiliated Fund and

★

made

an
all-time high this year, even
exceeding the levels of 1951. More¬

tion of his

on

be

may

confident that when

of the world's trade have reached

over,

size

am

that both the volume and the value

Substantiating the importance of specifi¬
cation by the opposition in the Montgomery
Ward controversy is the following explana¬

spook

I

all the data

capital.

or

statements

uation.

high executives, and specific financial
as
merchandising policies, including

longer virtually the sole sup-*
plier of such goods as in the early!

no

of

Oucpci u

,7,

Ward

,

in the purchasing power of the
primary producing countries, after

stress op

*

Decision

capital goods remains
high everywhere, but the U. S. is

have the end of the Korean commodity t0 the prewar pattern. In these
boom. Another.factor was the 1952 postwar years we have seen not
caurecession in WesternjEurope's cononly short range changes but ma-

improvement.

Presumably the Opposition will employ the time before the

De¬

for

mand

•

1952, brought
-

But it would be wrong to carry

r

postwar
off.

tailed

•

tion and much

.

general efficiency program of concentrating
profitable units. And coincident with Mr.

retail

exceptional

coal has

in

many

of

notes

-

s hiring of an outside public relations firm, he charges that
the efforts of his opposition constitute "a menace to the United

Additionally in-the-act for stockholder excitement are Fred
M. Saigh, St. Louis businessman and former owner of the Cardi¬
nals baseball team; and also a
potentially active moneyed group

an

ing the Convention I am

:i sure
you

Ayery

States," and the work of "raiding parties" (not stockholder rescue
parties).

trade

I

send-off. Dur-

Presumably the incumbent Sewell Avery will pot accept the
challenge, to a Lincoln-Douglas type of idebaie on this circuit;
but, taciturn though he may usually be, he- issued word to his
newly wooed stockholders last week that the company is planning
to close a goodly number of the smaller retail/stores by the end of
the year as part

trade

to

try

give* you
.

.

on

The

value .increased by nearly 60%, other categories of semi-luxury
reaching $77 billion in 195.1. A goods.
encouraging temporary setback
occurred in i j do not mean to imply that

should

V

,

to-cqast-. .>;■

.*•"

•

.

subnormal, has recov¬

was

ered.

from 1947 to 1951, the volume of

to the conclu-

prox,y

•

the

"

victory will be explained by him in a
grand "whistlestop" electioneering tour using
hired meeting hails m 40 cities from coast-

.4:

Wilfrml M»,

/-J.; 'Y.l't-X g'7'7

;

the

bled as result of the price rise, citrus fruits and. other ^agricul-i
During the following four years, tural specialties, which was low-

might need most to be said, I came
that

from

toward

back

prewar

tion, and considering what things

sion

receded

peaks

level, ;and the value of were selling at very high priced
these goods had more than dou-*- have had to cut back. But trade ih

function as
this Conven-

my

last speaker of

the

These and other juicy fruits of a Wolfson

■

which

favorable de¬

favorable for further world trade expansion.

when and if it should be needed for such ex¬

M

A.

a

of

recovery

On the other hand,
trade in meat and in fats and oils,

American international trade. Notes United
States foreign trade for current year is at peak level, more
than 3V2 times prewar total, in spite of postwar continued
restrictions and impediments. Says trade is not only expanding
but is swinging back into more stable patterns, less influenced
by emergency conditions. Reviews changes and shifts in
segments of our world trade and concludes many signs are

The

the

level.

prewar

New York

in

velopments

has

wheat

in

postwar

Chairman of the Board, National City Bank of

-

k

With

war.

European agriculture, world trade

By HOWARD C. SHEPERD*

By A. WILFRED MAY

H

are

respects the pattern now re¬

some

sembles that which existed before

1954.

York City,

V

West 44th Street, New
Direct

Private

Wire*

York 36, N. Y.
to

Canada

6

The Commercial and Financial Chronicle

(2142)

support in agricultural areas.

The Election and

While

States

of economic
the United

States?

ture.

Both countries have

tion.

Tax

that

they will have

1954

they are more dicompetitive in preferred
export markets than is the case
with
Australia,
Argentina,
and
other
wheat
producing nations.
larger

country
not

fore

this
be-

any

results.

„

.

-

...

n

Harry A. Bullis ^

the

Mighty Mississippi,

economic
cycle will just keep rolling along
as it ever
has, oblivious to sweeps,
our

in the political tide, It is
my firm
conviction
that
this
economic
movement
will
be forward
and

positive

in

nature;

productivity in
that

it

that

in

in

taxes.

possible,

was

lifted

In

to

Korean

fact,

be¬
high

a

conflict

taxes

were

June

30, 1953, when ex¬
caught up. Since we
were
practically on a "pay-asyou-go" basis, much of the reduction

neither

to

will

bring

about

an

many

Henry

years

Clay

who

that

ago,

of

years

acter

average

tration, should receive careful at-

difficulties,

balance

cut-throat competi¬

TTMrin Cf

take

be

translated

sufficiently

real

price

amounted

The

tax

to

benefit

reduction

about

from

taxes

to

warfare.

ticipated

price

a
and

$7x/2

the

billion.

divided

between

mainly to;

Noteworthy

in

individuals

an»-

the

The outlook for

resulted

from "concurrent
majorities" from
both political parties" in
Congress^
So it has been in the
past decade.

reasonable

between

some

of

a\

the

arrangement
Western World and

the Communist world

brighter than in
Unless

sort

working

now

any recent

seems

in

ment

reached

of

the

those

this

changes, the United
past yearvthe States may be expected to conParty gave President tinue to reduce its defense exDisenhower the margin of support penditures.
This
should
permit
to

tration

s

enact

the

Adminis-

program.

'

So

it appears

.

Itrill

to

that there

me

.

Ua

will

1-14-4-1.-.

be

_

little,

government

if

attitude

1

1_

»

change

any,

toward

3 700 000

States

By

same time

the

trade.

The

^

nowever,
there

'

recession

by the easing of credit,

The first occasion

in June and

was

bound to be sword-clash-, visors that a
recession had started
refer to tax policy, farm as the result of

is

Delations

Act

will

not

in

mv

not, in my
opinion, endanger the unity which
is so
necessary on foreign policy
-

-

security problems.

under

control.

J f,,ShtrL of credit
/Umi^er'
a further easing

A

prac-

legislation can be passed
bi-partisan support. In
opinion, this will make both
no

without

W

was

ac-

complished.

All
told, the
total
amount of the easing of the bank
reserve

The very closeness of the
outcome
of the election reveals
that

tically

bringing defense

expenditures

Uies^nolith'al the°mlddlpC^ffT ,occurred ab°ut

But

controversies

my

_

will fly, July, 1953, when it became clear
areas,
where: to the President's economic ad-

fng. I
policy, public power, and amend-

and

•

sparks

other

in

1

position amounted to

some

file

responsible.

The

Repub-

in

took

Democrats, being responsible

J.or

the

liouses,

organization
will

have

of

to

both

take

a

responsible position if their candiin

cate

1956

is

factory platform
We

can

1 olitical

vill

be

have

on

which to

expect

no

great
-

in

but

it

run.

and

seems

for

the

changes which
6
courcp

nr

dir^-

t/.on of legislation. I believe this
U fortunate because the legisla¬

the

homes. The effect of this is to
courage home

probably set

new record

a

Chamber

of

Commerce

in 1955

Social Security: Social
Security
Payments for old age were increased and broadened. It is not

will
-

broader

encourage
-

tor

compensation

to

Congress
coverage'

the

ployed.

had

October

total em-

Payment has increased. In terms

on

its agricultural pro-

flexiWe price

P°cts. I believe the

Vote

in

sup-

Washington,

D.

1954.




c.,

as

Nov.

dicates

a

Iowa

large

and

Kansas

measure of

popular

imports

and

the

of

world

the

be
to

free

to

close

come

con-

to

of expend-

will

trade

strength

of

the

world

in-

From
rate

a

pro-

the pr0spects for con-

are

tlnued

eCononhc

growth

StateS]

,

in

the

and

decline of $14
the

billion,

peak rate

of

was

3%%,

or

the

gross

calls

for

trucks.

509,000 automobiles
For

December,

mobile
their

inventories

trend

in

f

thi

downturn

is

Eisenhower Ad-

The

ministration has brought down
the annual rate of expenditures
for

national

billion
ter

in

of

defense

in

rate

1953

the

to

third

the

from

$43

a

$54

a

second

quar-

billion

rate

of

quarter

—a

1954

swing of $9 billion—from
lation

at

rate

accumu-

companies

the total

are

of

increasing
and

steel

production

of

tories because of

This

durable

slightly lower

a

and

and

sale

non-durable

of

con-

the
to

income

actually

increased.

services, where
of

the

no

total

appreciable

inventory

is

carried.
The

total

in

terms

and

purchase

for

5%

in

and

of

inventory,
amounted to about $20 billion. Of

to increase

I

1955.

of

believe

producer's

tools,

will

equipment

con-

foreign
investment
will remain practically
unchanged, if not increased. The

probably

of reduction in government
expenditures for national defense
rate

will

continue to

slower rate.

decline, but at

be

offset

by further

tinn

in

tavp„

tn

.

.

reduc-

.1

Prn-

JXic expans!on Exp^ndUures
state

local

and

a

This reduction could

wejj

of

governments will

undoubtedly continue to increase
about

at

the

rate

same

in

as

the

past two or three years, for the
pressing needs for schools, high¬
and hospitals must be met.

ways

is

encouraging outlook
opinion no part of it
will be affected by the changes
in the control of Congress.
The
American people are interested in
economic growth and they have
some understanding of the desir¬
able policies which can be adopted
to promote such growth. I can see
no reason to expect any different
attitude in the new Congress other
in

and

an

my

developed

was

in

the

last

Con¬

gress.

Conclusion
The long-term
^

^

prosperity of the

We businessmen must

foj'ulnd to°strive and risk for
n°r It' ® ° be achieved and in
achieving it we can establish a
standard

new

enterprise
orxH

initiative

of

banner

social

of

all

for

the

world

the

to

ourselves

address

to

free

and

It behooves us,

f0 e^>ula+p

therefore,

progress

attainment under

mutual

and

constantly to this task,
should

h,KinP«mPn

W(3

bv the

sobered

fact

be

that we often

thp
the

miss

present

hull's
bull's

year,

leverage

lift

to

country

our

that it

direction

increase

jobs

must

and

to

raise

spending power for the long pull.
is

It

up

to

businessmen,

desirable

you

to

and to me, as
find additional

policies to

achieve

greater production and larger disposable incomes. A goal of $400

billion Gross National Product by

the end of 1956 seems reasonable,
The President already has said

increase
'

as

much

as

$3,000

per

.

chaileng

incomes
Thls ls the
the tax reduc- can Industry. It is a big challenge,
incomes before but it can be met and mastered,
during the first half of 1 54 Tbe stakes are high and they con-

Similarly,

corporate

helped by
tions.
Corporate

were

buTthr^^^^^

offset by lower taxes. Thus,
business as a whole is nearly as

was

in

travel

a

liquidation of inventories.

taxes

decline,

a

ex-

reduction

Total consumer ex- itures at a high level, and also
penditures actually increased dur-, helped to prevent more drastic

of

see

consumer

significant effect of we can reach a goal of $500 billion
which helpid by 1965. If this goal is reached,
maintain
consumer
expend- personal income per family might
was

tax

sumer goods

share

I

year

in

*** °nnet
ab°Ut the PreSent ^
Our

to

of

production

coming
rise

purchase

plant

the

sonal

of

the

about

ahead.

represent the reduction in invenrate

by
the

goods and services in the months

The total of personal incomes
lau°n al a..ral« °f $5 billion an-.
?
a rate of
before taxes was smaller this year
nually t0 liquidation at
$4 billionthan last, because of rising unPerhaps half of the swing in employment and shorter hours of
inventories might have been a work per week. However, this
decline was more than offset by
Pr°Per adjustment to compensate
for the decline in defense spend- the reductions in.personal taxes
inS- Then *he other half would and, as a result, disposable pera

addi-

pvp
eye. Consider the
Consider the...
when
instead of
lowing
a
productive
growth
metal products.
In consequence,
eqUai to the average annual rate
the
rate
of
production of the of 2i/2 to 3%, we showed a decline
steel
industry is rising.
There- of siigntiy more tnan me $iu xo
si-eei umusay
is naiu*.
xucxCslightly
than the $10 to
fore, there is little expectation of $12 billion represented by those
further inventory liquidation and percentages. We can shrug it off
there is some expectation of an as due to declining defense exincrease in income as a result of penditures. But the fact remains
greater activity in these bas c in- tvat we did not take up the slack,
dustries.
I look for an upward We did not provide the additional
.

national out-turn of all goods and

Thp

makes

competent authorities

the

production
is
632,000.
schedules, the auto-

planned

To meet these

services.

nuite clear

This

result

a

penditures, probably accompanied
by a slightly more rapid rate of

month in four

For November, the sched-

years.

ule

a

p0r

continued

happen.

Economic Ou'look

what

three quarters of 1954.
from

depreciation

vide , a firmer foundation for the Um1;ecj States is directly related
continued economic growth which to our ability to create and mainVs 80
progress of t.ie tain a dynamic and expanding
free world' 71':l?* f?! domestic economy. It will not "just

of $356 billion for each of the first

This

for

for

amortization.

coun¬

and

trucks—the lowest

1Q4Q
lata.

quarter
of
1953.
there, it sh*d downward to

equipment,

and

aside

than the favorable attitude which

convertibility

second

SUCh

in-

little

a

its peak rate of $370 billion in the

nf
or

plant

set

This

the

Perhaps a few figures will be
helpful as illustrations. In October, 1954, the automobile industry
produdced only 232,000 cars and

cinn

™d'":,7h"Th?X7TcLLrr«rc.f rt:v; 1 "CrVK u,e ™le in sucn the two items of national defense
United States,
io.

have

currency

freer

United

unem-" ing this same period, but the increase came primarily in the area

Agriculture: The Administration
stood firm

the

en-

building which will'

}.Z'XunA'f the*Board's offctgram incIudinS
Canadian

Of

readily
purchase
of

more

belTeve" that "ther'a unlikely °that"TheU"new

to

-

occur

satis-

a

disputes

bickering,

Reasonable "
V/ill

to

steps to make credit
available

rate

tional funds available to industry
for use in financing new purchases of improved tools, equipment and factories,

^

$4 billion. This has made abundant
drop of $11 billion. As a consecredit supplies available for all
quence, business becan to reduce
Purposes.
The government has
inventories
and
there
was
a
entered the short-term market, in

order to leave the long-term capi»?1 markets open to business to
Congress will of neces- finance
its
growing
needs
for
city be supporting the Eisenhower capital expenditures."
legislative recommendations, and
The Administration also
parties

Deans

of

nations

tries of ;< the free

Gross National Product reached

_

which

.crease

unemployment
had
decreased to 2,700,000, one million

further reduction in taxes,

Easing of Credit: Another important
development
was
the
policy adopted by the Eisenhower
Administration
to
combat
the
_

in

really basic issues of national security, foreign policy and reciprocal

some

be

„

Freer

Democratic
necessary

that

are

point of general currency
vertibility.
...

uuemuuuvunempToy-

13^

United

other

the

1954,

period? less- At the

enlargement

future^and

r'V' V ";

1954,

ui

the

high rate of im¬

probabilities
Congress may

world

Program

March
un

In

Profits tax.

most

of the forma-

nation

our

said,

result

foreign trade.
This should
encouraging to Canada and

of Administration

V

a

as

■

new

.

Result

moderate amount

a

The

.

fidence for the immediate
;

areas,

of maintaining a

prices not only down to,
actually below, International
Wheat
Agreement
minimum

excess

gold

ports.

but

.J,

other

and

together with the
willingness of the United States to
allow its gold reserves to flow out

have carried world

reductions..

flowed

Canada

of

war
between- more favorable to tariff reducUnited
States tions and reforms directed toward

the

would

has

producing

any

importing countries had

foreign

world

tion

is the fact that we have not gone
to the International Wheat Agree¬
ment
minimum
prices, whereas
most

Funds

nm-

that

prevent

continuing

are

aid. The rest of
gained in dollar
gold reserves during the past
TU/\r«A\
Umm
two years.
These have been provided by the new gold producthe.

wheat

*ni° reduced taxes,
total

fact

we

and

PC

the

of

ities

Canada

could

note

CO

been in reasonable

and

needed

each country has curbed its activ¬

which

out

Yioxxr

as
as

life
lite

the

accounts have

inclination

any

public

by all of our citizens.
international field, our

as

In

United

the

nor

both

of

leaders

the

ers

True,

9m

by

tention

now,

worked

through elimination of the

>

important legislation
tive

these

shown

commence

tion.

of an economic char¬
coming from the Adminis-

proposals

mlSSuSE! political American
Par"f®
in

Canada

has

States

in
expenditures which the
Eisenhower
Administration

will- in excise

it

tion.

was

up

supplies,

to enlarge tneir pro

of

for

Eisenhower

well

spite

iture

by the fortunate turn of; increase in consumer disposable
the
guidance
of income. Expenditure on all conAdministration. struction—housing, factory and
Therefore, on the basis of merit, other construction—is expected by

period of years and

a

to producers

ever-improving standard of living through decreased personal ill-,
for a nation of
increasing popula-, come taxes, and corporations
It

built

must

The

and

under

events

the

1S
e S1gmficant /ac* m
to new heights of individuals. The remainder of the .todays agricultural situation and
the next decade; reduction was about equally should give us considerable con-

carry our nation

and

im¬

penditures

regardless of
Like

yields over

In

most

reduction

the

out.

ended

high

a

last,

as

which helps

sobered

duction.

enough in 1951 to produce
receipts almost 50% above
the peak receipts of World War II.
As a result, our
budget was in
sound shape until the year which

flurry of
ballots,
the

have

normal
through
above
than

total

will

waver

nro-

Program
The

were

when

broke

in

now

motion in

taxes

level

gigantic

forces

countries

Both

development

reduction

cause

economic

Instead, the economy has shown
stability. The prophets
of
doom
should
be
somewhat

remarkable

both have been, and
aggressive sellers, and
hmn
both are trying new sales H"OOO
devices
to
increase export flow.
However,
any
competent
observer

The

effect.

The

the

was

produc-

high

little, if

any

single

must

or

countries

therefore

and

stability.

Reduction:

portant

outlets

dollar

are

predictions of the

the

were

prophets of doom who early in
1954
predicted
that
we
were
headed for a growing recession.

countries

domestic

ov/n

Both

able

of their do¬

both

rectly

adequate

Economic

agricultural

excess

and

needs

must have export

has

vpflrq

opments have proved how unreli-

mestic

curb their

1

These rather remarkable devel-

'

production in

reasonably adequate basis

for economic

My

is

promote

year

factor

accelerated

today and is likely to be in

partly

The

this

the

provisions

important national

tinn nf thn nact few

■'

is

of

in

conditions

course

profitable
this

hospitals, etc.

Product in 1956.

a

con-

as

Says, however, "sparks will fly" in
public power,
on the whole,
no
radical changes are expected in the favorable attitude
toward business developed in the last Congress. Urges busi¬
nessmen work for a goal of $400 billion in
Gross National

vided

total

in

spending, expenditures for

sumer

increasing, partly

reciprocal trade.

question
is
frequently
i?sked—What effect, if any, will
the recent elections have on the

offset by

was

increases

moderate

prob-

are

other areas, such as tax policy, farm policy,
and amendments to the Taft-Hartley Act, but

The

this total, $6 billion

United

mutual

housing and factories, and in the
expenditures of local government
for schools, roads, toll highways,

legislation has resulted from "concurrent activity" of both
political parties, foresees little, if any, change in government
attitude toward basic issues of national security, foreign policy
and

the

and

many

first place for the foreseeable fu-

Chairman of the Board, General Mills, Inc.

Prominent industrialist, in pointing out most

Canada

have

lem

By HARRY A. BULLIS*

very

Thursday, November &5,1954

.

lems, there is no question but that
the
disposition
of
agricultural
surpluses is a number one prob-

The Business Outlook

belief

..

"St

^spherf1'and"

this hp,

the world as well.

.Volume 180

^

Number 5380

.

.

.

The Commercial and Financial Chronicle

7

(2143)

New Construction in 1955 Set At $391/2 Billion
New

construction

expected

to

is

activity

reach

lion,

high of $39 y2 billion in 1955, 7%
above
the
record
breaking $37

The

-

greatest boost to privately

from

prepared

jointly by the U. S.
Department of Commerce's Build¬
ing Materials and
Construction

farm),

Division

construction

and

the

U.

S.

tinue

the

will

consumers

record

a

rate.

con¬

of

construction

at

1954

100,000 units. The 1,300,000 total
public and private housing units

There

estimated

com¬

only

paratively favorable rates, and it

to

get under

would

year

to

make

the

peak

when construction

will remain
relatively stable. The

next

way

1955
year

is assumed that construction costs

second

of

1950,

1,396,000 dwellings.

possibility
tures

from

sumptions

significant depar¬
any of the above as¬

should,

kept in mind

of

when

1955.

World

Current

indications

that

are

eligible

both private and public construc¬
tion

will

set

new

records

ileges,

next

of

year, with private expenditures
estimated to increase to $27.4 bil¬

NOT A NEW

on

to

rise

moderate
gains
in
petroleum
pipeline construction and electric
plant expansion.

middle-

become

more

prevalent.

Of special significance
strong trend toward home
ownership in recent years, which

New

the

reflects

consumer

will

preferences.

vitality

to

the

present

influ¬

are

War

II

GI

for

which,

Rights,

still

veterans

expire

the

Bill

1957;

in

GI

and

changing family housing needs,

as

in

construction

be

1954,

defense

housing

after

declining

plant

1950

Nonresidential

tracts

Construction

awarded

*

that

ex¬

the

rate

of

put

the

to be less than in

in

total

construction

private
in 1955,

Current

prospects

in

ization

are

put in place
in 1955, with the emphasis on new
stores, shopping centers, and of¬

urban

new

growth.

The

still

cline

in

railroad
will

and

be

a

new

likely
in 1954, will exceed the
$9 billion
in

appears

1955.

to

provide

facilities

pected

in

1955

increase

to

by

year.

a

public

new

are

ex¬

16%

$2.4 billion.
Public

and

construction

is

private
hospital
likely to increase

next

year, but will not reach the?
levels attained in the
1949-195&

period.

New

sewer

and

water

facility work in 1955 is expected
to go over the
$1 billion level fcr
the first time.

*

.

1

Outlays for direct Federal con¬
struction, which experienced a

will

offset

a

decline

in

1954,

will

further but much smaller

ing, particularly on atomic energy
plants,
for
which
constructions
will

have

eral

work

passed
on

development

Highway construction probably
reach
a
new
high of $4.2
billion next year, or nearly onefiftfi above this year's level, re¬
flecting the expanded program of

a

utility
by

gas

State and locally

on

projects, for which

high of $8 billion

whole will hold close to the peak
levels of 1953 and 1954. Some de¬

construction

Outlays
school

averaging

pupils

reduction next year.
Principal de¬
cline will be for industrial build¬

level
as

in

are

1,500,000

show

owned

will likely expand

expansion

increase

which

creases

nearly

substantial

expenditures

1954 than in any

utility

Construction

anticipated

1955, responding to the*
replacing obsolete facili¬
ties and providing new classrooms
for
continuing
enrollment
in¬

Local public works. The value of

sub¬

in 1955.

Public

are

construction activity next
reflects continued expansion
for nearly all types of State and

Religious and pri¬
building, each of

year,

more

facilities,

in

pace

need for

expected

1954. New non-

existing

building will continue at its Syrift

year

which achieved more construction

previous

is

Federal aid to highways, and an.
anticipated increase in toll-facility
construction.
Public
school

public

vate educational

put in place in

of

Public

housing de¬

continued

and

1955

factors which will slow the down¬
trend
in industrial construction.

continue to expand to a new high

service

in

so

work

chemical, steel, and
processing plant expansion,
plus increased outlays for modern¬

of $2.3 billion of work

to

place

in

food

that commercial construction will

fices

con¬

ferrous metal,

operations
important types of nonresidential
building are also likely to break
records.

in

industrial

decline

pected to account for the bulk of
increase

for

begun

in place.

building has been leveling off,

Although private housing is
net

moder¬

expansion

has been put

However, the downtrend
Private

less

somewhat

ately for the third successive year,
since the major part of the
huge

market.

home-loan" priv¬

under

industrial

probably

than

This in itself imparts much of the

velopments

supporting new
housing demand are widely dis¬
tributed liquid assets in the hands
of
the
millions
of
consumers;

assessing the

outlook for construction in

that

ences

be

course,

started

was

the. important

Among

of

in

new

housing legislation indicate, that
private dwelling units started in
1955
will
exceed
this
year's
anticipated high total by about

should be sufficient capital funds
available to finance a very large
volume

for

demand

strong

based

on

continues

families

groups

con¬

credit terms provided by the

activity will remain
stable, and disposable

of
at

A

year.

this increased

economic

income

next

ready availability of
mortgage money, plus the easier

assumption that the general level

relatively

is expected to in¬
to $15 billion and
for 55% of all private

homes,, the

The prospect for
volume in 1955 is
of

for

(non-

which

tinued

Labor

Statistics.

building

larger

by 13%

to account

Depart¬

ment of Labor's Bureau of

come

expenditures

greater

residential

crease

will

construction

financed

birthrate

income

is

,:

billion volume indicated for
1954,
according
to
outlook
estimates

new

$12.1

and public outlays to

billion.

all-time

an

the
>and

tinue

to

the

peak. Fed¬

conservation

projects

decrease

next

will

and
con¬

On.

year.

the other

hand, construction work
at; military bases, following
a
29% drop in 1954, is scheduled for
a rise of
nearly one-fifth in 1955.

ISSUE

$7 5,100,000
NEW

JERSEY TURNPIKE AUTHORITY
3!A%

Dated

Turnpike Revenue Bonds (1950 Issue)

January 1, 1950

Due

January I, 1985

Principal and semi-annual interest (January 1 and July I) payable at The National City Bank of New York, New York City, and at The National
State Bank of Newark, Newark, New Jersey.
Coupon bonds in the denomination !of $1,000, registeqiple as to principal only, convertible
into fully registered bonds in the denomination, of $1,000 or any
multiple thereof. Coupon and registered bonds are interchangeable.
'
■

•'*

\

'

Interest

/.

•

Redeemable

'

•

prior to maturity

as

'•

.

.

'

provided in the authorizing resolution.

/

exempt, in the opinion of Bond Counsel, from Federal Income Taxes under the existing statute and court decisions.

The Act

authorizing the issuance of these Bonds provides that such Bonds shall not be deemed to constitute a debt or liability
Jersey or of any political subdivision thereof or a pledge of the faith and credit of the State of New Jersey
or of
any such subdivision. The $220,000,000 Turnpike Revenue Bonds (1950 Issue), of which the bonds being offered constitute
a
part, are payable solely from the tolls, other revenues and proceeds of the bonds pledged for their payment pursuant to the
resolution of the New
Jersey Turnpike Authority adopted February 10, 1950, as last amended September 16, 1952. There are
also outstanding $35,000,000
Turnpike Revenue Bonds (1951 Issue), secured equally with the 1950 Issue, and $177,200,000
Second Series Bonds secured by a
pledge of Surplus Revenues, as provided in the authorizing resolutions.
of the State of New

Price

106%%, and accrued interest

These Bonds

are offered when, as and if received
by us. Upon delivery the Bonds will be accompanied by the legal
opinion of Hawkins, Delafield & Wood, New York City, Bond Counsel to the Authority, dated January 5,
1953. Delivery of definitive coupon bonds is expected to be made on or about December 1, 1954.

This

is not an offer to sell or a solicitation of an
offer to buy these Bonds. The offering
only by means of the Offering Circular, copies of which may be obtained in any State from only
of the Underwriters, including the undersigned, as may legally offer these Bonds in such State.

announcement

is made

such

Smith, Barney & Co.

BIyth & Co., Inc.

The First Boston Corporation

Halsey, Stuart & Co. Inc.

Harriman Ripley & Co.

Lehman Brothers

Incorporated

Drexel & Co.

Alex. Brown & Sons

Glore, Forgan & Co.

Phelps, Fenn & Co.
November 24, 1954




C.

J. Devine & Co.

Goldman, Sachs & Co.
R. W. Pressprich & Co.

Eastman, Dillon & Co.

Kidder, Peabody & Co.

Union Securities Corporation
:

.

Equitable Securities Corporation
Merrill Lynch, Pierce, Fenner & Beane

B. J. Van Ingen & Co. Inc.

White, Weld & Co.

8

(214*)

The Commercial and Financial Chronicle

Broadway, New York 6, N. Y.

Riverside

Cement

—

Analysis

The

Telephone—Analysis—New York Hanseatic Corpora¬
tion, 120 Broadway, New York 5, N. Y. Also available is an
analysis of Investors Diversified Services, Inc.

Rochester

li a's
$25,000,000 refunding operation.

Commonwealth of A u s t r a

Sapphire Petroleums Ltd.—Analysis—Franklin, Meyer & Bar-

Base

Metals—Study of

Southern

Also available

adian Banking

is

booklet

a

on

the operation of

Production

Co.—Memorandum—Eastman,

Dillon

probably
Telephone
Telegraph Co., will open bids
for $30,000,000 of 34-year deben¬
The

week,

following

14, New England

Dec.

New York 6, NV Y.

way,

partial refund¬

a

ing operation.

Spencer Chemical—Analysis—J. R. Williams & Co., 115 Broad¬

Can¬

This is

8.

Dec.

&

15 Broad Street, New York 5, N. Y.

Co.,

Canadian

companies engaged in pro¬
duction—A. E. Ames & Co. Inc., 2 Wall Street, New York 5,

N'. Y.

000,000 of first mortgage pipe line
bonds slated for market around

corporated, 44 Wall Street, New York 5, N. Y.

Company, 1033 Thirtieth Street, N. W., Washing¬
7, D. C.

negotiated offering of $125,-

Co.'s

Signode Steel Strapping Company—Review—Blair & Co., In¬

Development

Securities
ton

with Tennessee Gas Transmission

New York 5, N. Y.

way,

Glossary—Literature—Atomic

and

promises
activity what

week

bit more lucrative

a

& Co., 120 Broad¬

second

the

But

nett, 120 Broadway, New York 5, N. Y.
Selection Trust, Ltd.—Analysis—Sutro Bros.

Map

the

any

Square, Boston 9, Mass.

Atomic

•

month

into the final

turn

year does
not hold out
promise of exceptional ac¬
tivity, at least not in the early
stages. Well up on the list is the

of

Lerner & Co., 10 Post Office

—

25,1854

Forward

Looking

Co.,

Public Service of New Hampshire—Analysis—Ira Haupt &
111

Thursday, November

...

&

System.

Stokely-Van Camp, Inc.—Bulletin—Dreyfus & Co., 50 Broad¬

Canadian

Letter—Fortnightly review of the Canadian Securi¬
ties Market—Newling & Co., 21 West 44th Street, New York
36, N. Y.

New York 4, N. Y.

way,

will launch the sale of

and

tures

of

shares

511,205

stockholders

a

on

common
to
"rights^ basis.

Chemical Fertilizer Industry—Analysis in

"Monthly Stock Di¬
gest"—Nomura Securities Co., Ltd., 1-lchome, NihonbashiTori, Chuo-ku, Tokyo, Japan.

Common

Stocks of Eastern Railroads
Analysis
Hickey, 49 Wall Street, New York 5, N. Y.
—

Housing Boom—Analysis with data

on

to

Vilas &

—

Notes

NSTA

selected building ma¬

SECURITY TRADERS ASSOCIATION OF NEW YORK

Security Traders Association

portfolios—Thomson
McKinnon, 11 Wall Street, New York 5, N. Y. Also avail¬

able is

a

suggested

—

Scharff

&

the

fore

New

&

Co.,

Inc.,

1 Wall

Institute

(Capt.),

Hunt,

O'Connor

Werkmeister,

Kullman,

30
29%

it

difficult

money.

"

convenient outlets
in

26

1

Klein (Capt.),

Rappa, Farrell, Voccolli, Straus, Cohen

Point Club

200

of
Julie
BOND

CLUB

OF

Walt

the

annual

on

New

of Denver-Investment

California

Ltd.

—

Memorandum

Corn

—

experience of New York
Telephone
Co.
3s
brought
out
several weeks ago.
For a time

Our

after
set

Gas Transmission Co.

Exchange

Bank

of

New

York

—

Bulletin

to

Reporter's

—

Laird, Bissell & Meeds, 120 Broadway, New York 5, N. Y.
Machinery & Chemical Corp.—Analysis—E. F. Hutton &
Company, 61 Broadway, New York 6, N. Y.
Mason

Corporation

sis of National City

Glen

Roger

1108

Credit

—

Leowi

&

Co.,

Also available is

225
an

analy¬

Bank of New York.

Inc.—Analysis—John

Underwriters

C.

Kahn

Company.

and

&

Meeds,

Corporation—Analysis—Herbert

&

Sons

Portland

General

Company ^Analytical brochure
Blyth & Co., Inc., 14 Wall
Street, New York 5, N. Y.

and

mood
the

of

find
thin

dealers,
as

far

is

market

themselves
of

now

as

the

con¬

running

material

at

the

The

fact

new

remains,

corporate

ing market
received
old

the

are

even

however,

issues

reach¬

being rather well

though

some

line, institutional

syndicate

decided

to

a

market of 100 bid and

—

$1,200,000,000 of the total
refunding of outstanding

debt at lower interest cost. About
was

raised for plant

equipment, and the balance,

just over a billion, to provide
working capital.

Little Miss Jones
Routs the Wolf

100%

SEATTLE,
Wash. — Prescilla
Now
the
bonds
are
being Jones, aged
10, starred as Little
quoted at
100% bid and 100% Red
Riding Hood in the Seattle
asked with every indication that
Iceparade of 1954, and chased six
the bulk of the issue has been
feet of Big Bad Wolf right off the
well
placed.
Meantime
Pacific ice arena to the loud
applause of
Telephone's 3%s are command¬
Papa (Jack E. Jones, Blanchett,
ing a premium of about % point Hinton &
Jones.), Mama and most
over the
offering price at which of all her twin Jonathan. It was
they

of the

investment

brought

were

out

a

week

ago.

a

gala birthday for the twins, too,

who

endar

is

the near-term
thin

the

cal¬

with

Day

naturally

ness

this week.

Thanksgiving
making for dull¬
However, under¬

writers who maintain trading de¬
partments are finding the sec¬

celebrated

versary

their tenth

Nov.

on

20.

anni¬

Big

Taffy is away at college
University of Oregon.

sister
—

the

With Brown Bros. Harriman
(Special to The Finawcial Chronicle)

organizations continue to be cool

ondary market
esting

What has been happening is
perhaps best illustrated by the

and yon for*, outlets for. their ac¬

Harriman

cumulating

Square.

x

as

a

bit

more

inter¬

investors search, hither

funds.

Member

Corp.

&

Co.,

10 Post Office

SECURITIES

S
|

3429 BERGENLINE AVENUE

®

GABRIEL

{

®

N.A.S.D

UNION

Broker and Dealer

Preferred

BOSTON, Mass.—Roger B. Sa¬
linger is "with
Brown? Brothers

DEPENDABLE MARKETS

Co., £td.
Common

for

this issue free it settled down

But for

Uotirata Securities

buy & sell

O'SuIlivan Rubber

aggregate of $7,000,000,000,

to prevailing^ yields.

laggards.

Electric

We

rather

that

Inc., 123 South Broad Street, Philadelphia 9, Pa.
Phelps Dodge Corporation—Bulletin—Francis I.
dv Pont & Co.
1 Wall Street, New York
5, N. Y.
Also available is a list of
44 selected issues which
appear to be market

cheerful

cerned,

Baus

Company—Analysis—Woodcock, Hess

Co.,

a

moment.
M.

Co., 2796 West Eighth Street, Los Angeles 5, Calif.

Joseph Bancroft

in

behavior

Washington 6, D. C.

Corporation—Report—Laird, Bissell

Bakeries

Report

East

Broadway, New York 5, N. Y.

Interstate

&

Analysis

Sixteenth Street, N.W.,

Harnischfeger
120

—

Street, Milwaukee 2, Wis.

t

asked.

Food

Froedtert

an

$4,300,000,000

recent

Co., 453 South Spring Street, Los Angeles 13, Calif.
available are memoranda on Landers, Frary &
Clark,

Chemical

in

earlier,

of

Fewel &

and Tennessee

year

from $6,400,000,000 in the 1953

and

Pacific Railway Co.—Analysis—Abraham &
Co., 120
Broadway, New York 5, N. Y.

Also

a

floated,

issues

About

Bankers Asso¬

Canadian

of

period

period.

Dec. 7, 1954 at 7:00 p.m.

Dec. 22, 1954 from 4:30 to 6:30 p.m.

on

Inc.—Analysis—C. E. Unterberg, Towbin Co., 61 Broadway, New York 6, N. Y.

Oil

up

was

Airborne Instruments Laboratory,

active

more

including
bonds, notes and stock, accounted

ciation Christmas Cocktail Party will be held at the Denver Club

♦

were

months of this year than
same

for

Bond Club

"

<SEC disclosed.

Mewing

DENVER

University Club

The

while.

Corporations
nine

The annual meeting of the Bond Club of Denver will be held
at the

to

in the capital market in the first

18%

Point Club

5

243

Bean

funds

new

bonds which
ample supply

turnpike
be in

as

a

12

—

for

Corporate Borrowings

Krumholz, Wechsler, Gersten, Gold— 19%
Clemence, Gronick, Stevenson, Weissman

(Capt.),

the

;

currently they are finding

such

24

McCloud

reinvest

to

mortgages, and revenue issues

Serlen (Capt.), Rogers,

Canada—Analysis—Burns Bros. & Denton,
Inc., 37 Wall Street, New York 5, N. Y.

Superior

find

But

(Capt.), Jacobs, Siegel, Topol, Frankel, Tisch—__ 25
(Capt.), Murphy, Frankel, Swenson, Dawson-Smith,

Krisarn

Uranium Mining in

Canadian

disposed to part

,,

for

Street, New

they are

33
32

McGovan,

A

Kuehner

for earnings—Ira Haupt & Co., Ill
Broadwa.y, New York 6, N. Y.

*

material

any

promise

Meyer

Rails—Review of outlook

*

with

Growney (Capt.), Alexander, Eiger, Valentine, Burian, Craig 26

Dividend Paying Stocks—

Chapter of the American

Schapiro

new

won't

interests

these

for

substantial portion of
their
portfolios.
They
are
not
sellers since they would naturally

Banks-Approved—Reprint of address be¬

Haven

Banking—M. A.
York 5, N. Y.

While

Manson

listing 180 stocks tax free in Pennsylvania—Moore,
& Lynch, Union Trust
Building, Pittsburgh 19, Pa.

Leonard

yields.

27%

Kaiser

Quotation Bureau Averages, both as to
yield and market performance over a 13-year period —
National
Quotation
Bureau, Inc., 46 Front Street, New
York 4, N. Y.

Preferred Capital for

Points

rick

used in the National

Long

reluct¬

say

reach

(Capt.), Nieman, O'Mara, Forbes, Greenberg, Murphy
(Capt.), Hunter, Fredericks, Demaye, Saijas, Kelly_
Bean (Capt.), Meyer, Bies, Pollack, Leinhardt, Weiler
Mewing (Capt.), Define, Gavin, Montanye, Bradley, Huff—
Barker (Capt.), Brown, Corby, Weseman, Whiting, Fitzpat-

report from Department of Revenue—
Jones, Inc., 219 Carondelet Street, New Orleans

Free

at

well.

as

(STANY)

Donadio

Annual

Property Tax

Inc.

Leone

Company,

12, La.

Booklet

remain

current

investors

not by any means

Over-the-Counter Index—Folder showing an up-to-date com¬
parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks

Personal

York,

New

Team

Inc., Wilder Building, Charlotte 1, N. C.
Louisiana

of

Bowling League standing as of Nov. 18, 1954 is as follows:

review of Otis Elevator.

Life Insurance Industry—Reviews—R. S. Dickson &

new

ability of bankers
issues major insti¬

those
who
contract
them, goes for big insurance com¬
panies not only in New England,
but in Philadelphia and Canada

Co., Ltd., Ill Broadway, New York 7, N. Y.
Portfolios—Three

the

look

That,

Investment Opportunities in Japan—Circular—Yamaichi Secu¬

&

to

ant

companies—Ross, Knowles & Co. Ltd., 25 Adelaide
Street West, Toronto 1, Ont., Canada.
Also available is a
bulletin on Lake Expanse Gold Mines, Ltd.
rities

place

tutional

terial

Investment

Reluctant

Big Investors

Despite

CITY, NEW JERSEY
UNion 4-7404

Circular

cn

Material and Consultation

Request

on

Troster. Singer, & Co.
HA

2-

2400

Members:

74

N.

Y.

Security Dealers

Association

Trinity Place, New York 6, N. Y.




ORIGINATORS

Japanese Stocks and Bonds
without
NY

1

376

61

AND

obligation

CORPORATE

Broadway, New York 6, N. Y.
Tel.:

BOwIing
Head

Green

9-0187

Office Tokyo

UNDERWRITERS

DEMPSEY-TEGELER & CO.

PUBLIC

AND

FINANCING

Number 5380

Volume 180

...

The Commercial and Financial Chronicle

(2145)

rate of some

a

The Institutional and Individual

.

this

$500 million for
We thus have a com-

year..

cate

a
net
supply of common
stocks of $1.2 billion for the year,
The conclusion, therefore, is that

bihed institutional and individual
net demand for

Demand for

equities of about
$1:0 billion for the year.

Equities
University

Professor of Finance, New York

presented

for it is that it is all

work with.

Dr. Bogen discusses the relative demand (or

stocks by indi¬
viduals and by investment institutions/and finds that adequate
statistics are not available to interpret properly the impact,
on investment demand of either class of purchasers. Lists prinopal classes of institutional investors and their importance
in the investment field. Regarding the supply of equities for

.

.

search

I

com-

medities,
the

in
few

last

yearsstatistics
have become

available

cov¬

ering the sup¬
ply of and de¬
mand

vestment
d s;
bond

f

u 11

kets.

We

the

»

,

c a s u a

It V

af*p

the

x

fira

.

billion

the

at

sources

bond

a

rate

dition to the Supply.

of

shares of¬

and

about

On the basis

Quarte^s> the net change , in the

$1

turn

now

and

supply

in

the

individuals,

than

statistics

for

each year
under the auspices of the Board of
Governors of the Federal Reserve

for

"What

much

nual

of the

appraising the future
demand, however, I
would like to take up individual
demand first, and then institu¬

am0"Pt of
standing would be $1.2 billion for

a

quences

spectacular conse¬
in our financial system.

cases

estate.

favorite

invest-

bracket

in

only 3%

said that

In 73% of the

But in 1953-equities were

this

6%,

as

year.,

compared with
•

,In the income brackets of $5,000

i

have

income

favored by

institu-

larger degree, we

your

they prefer
cases they
said they prefer savings accounts
or sayings bonds. Others liked real

tional

tions and invest directly in com¬

are

equities.

are

tnrougn instiiu

a

ments, a savings account, a savings bond, equities or real estate?"
People in the $3,000 to $5,000 an¬

individ¬

demand, since institutions
only a channel through which
1Ilalvlaual_
individuals ,nvesl their savings.
invest lnelr savings

evidence that

no

change is to be expected soon. A
number
of
people were asked,

of

stocks to

sav-

Survey which is made

trend

mon

bit

Peo-

flowing into insurance com¬
panies, banks, savings and loan
associations
and
pension funds.

In

through

a

This year, over 80% of the liquid
of the American people

uals.

investing

is

this year.

are

because
are

most

savings

for equities for 1954, I
talked about institutions first and

fuller

outlook

as we see

are

System shows

about

with

less willing to touch
ings when income dips.

mand
then

established,

And

economic

pie

once

rooted

they become more
to build up their savings if

eager

In making estimates of the de-

statistics for institutions

as¬

Will that continue to be the case?
The interesting Consumer Finance

Supply

market

deep

people.

to examine the

the

saving,

becomes

equities,

net ad- aDOUl investing

a

mailable data for the first two

Fire and casualty

year.

Demand

us

could

prospect

habit of

.

amf\ these do not 'constitute

comoanies)

insurance

new

to

that total savings will con¬
tinue close to, this high level. The

probable future trends of demand

vestment company issues, because

therp

are

In my

reasonable

sume

compiled by the SEC, less in- "mivmuais invest meir savings,
^
hpranaa
individuals change their minds 3%

as

demand for common stocks.

can

Let

stocks to satisfy

common

this net demand of some $1.6 bil¬
lion?
We have reliable statistics

appraise

the

tor

supply of

pension fund resources were of the volume of new
offerings of
provided by the Federal Reserve common stocks. But we must adBank of New York in its Decem- just
these, in a demand and supply
ber, 1953 bulletin, and long beanalysis, to allow for common
fore that by Dr. Roger Murray of
stocks that are paid off in liqui¬
the Bankers Trust Company. These
dation, mergers and retirements.
estimates indicate that independ¬
Only then can we measure the net
ently administered funds are in¬
supply of common stocks that
creasing their resources at a rate counterbalances new savings inof about $1.2 billion a year, and
^'e'd'in equities*.'*
about a quarter of this sum is be..
ing invested in equities.
If we
,A measure of the new supply
take 25% of $1.2 billion, we get of equitaes is the net change in
$300 million
of
pension fund corporate ^securities outstanding

rxnortgage mar-.
now

the rise in the prices of common
>n
stocks also has a concrete statist!

Future

of

Thirdlv

reluctant,

are

The Supply of Equities

monev

and

sellers

What is the net addition to the

money whirh nrovides a recurrin*
wnicn provides a recurring

in the

and

eager

Will that continue?

judgment it is

The statistical evidence shows that cloudy,

ties than there

believe.

.

for*, in-

have to

private regovernment agency
a

fered.

common stocks is
moderate margin. Makes forecasts
of future demand for securities, particularly as related to
equities and fixed interest obligations.

major

a

we

defin-

undertakes to do the job of com-

a

In the field of economic analysis, great progress has been made
in perfecting supply and demand
statistics. Developed first for the

or

Until

as a

piling definitive statistics of the cal basis.. The new demand for
demand for and supply of equi- stocks outruns the new supply,
ties, it is as good as can be done, More savings are going into equi¬

investment, he concludes the demand for
outrunning the supply by

stocks is

common

outrunning the supply, but by a
moderate margin,
itive estimate of this year's net deStocks can rise in price, of
mand for equities.
All I can say course, merely because buyers are
This is not

By JULES L BOGEN *

f

the demand for

saved.

9

to

$7,500, only 7% said they pre¬
equities, and 80% savings

ferred

accounts

or

savings bonds.

Last

year, the figure for equities was
10%.
The only group where you

Dr. Jules 1. Bogen
Individuals in the aggregate buy
by
companies put about 25% of their
common stocks with savings.
get any substantial preference for
into
common
stocks, the full year.
measuring the inflow of funds into resources
✓s
Savings of the American people equities is among those earning
the six major classes of institu¬ That is a third institutional source
Our figures thus mdicate a net
arfe a^. a very high level: in 1954,
$7,500 and above. In that group,
tions; savings banks, life insur¬ of demand for common
stocks, demand of $1.6 billion for com^ of the disposable income of
ance companies, fire and casualty
amounting to $250 million.
+v,;„
.nAi
Continued on page 35
the American people is being
companies, savings and loan asso¬
Fourthly,
the
life
insurance) mon
ciations, commercial bank time companies have been buying com/
deposits and pension funds, and mon stocks in a gradually increas¬
comparing it with the supply of ing amount. In the past few years
This advertisement is neither an offer to sell nor a solicitation of offers to buy any of these securities.
aaew investment securities: corpolife insurance companies in New
arate obligations, mortgages, state York, which could not previously
The offering is made only by the Offering Circular,
and
municipal
obligations and do so, have been authorized to put
November 19,1954
NEW ISSUE
long-term bonds of the Federal a small percentage of their funds
common
stocks.
Available
government.
— .: into

market

.

n.

,

.

stocks this year. They indi-

Such

demand and supply an¬

a

statistics

indicate

alysis has not been undertaken for approximately
common

stocks.

This

is

hard

a

Some of the required sta¬
tistics are hard to find, and they
are even harder to interpret. This
30b.

is

so

particularly because supply

sand demand for securities must be

of the
rather of
-the net increment of supply and
aneasured

in

terms

not

amounts outstanding, but

the net increment of
a

demand for

Stocks

The demand for common stocks
from financial

institutions

and from individuals.

Fortunate¬

.comes

this

million

$50,000,000

year

stocks under the authorization recently given them, and have
set up their own mutual fund to
facilitate equity investment. Mu¬
tual savings banks may buy about

The Kansas City

common

Railway Company
First

stocks in

Mortgage Thirty Year 3Bonds, Series C

including purchases

by banks outside New York that

Due December

Dated December 1,1954

we

1,1984

have the authority to do so.

Adding these institutional de¬
mands, we have a total of $1.1
billion of institutional money this

THE

ISSUANCE

AND

SALE

OF

THE BONDS ARE

SUBJECT TO

AUTHORIZATION BY THE INTERSTATE COMMERCE COMMISSION,

have statistics for a con¬
institutional year which constitutes a recurring
demand, which will permit us to demand for common stocks,
project net institutional purchases
Individual Demand
Of common stocks for the full year

ly,

Southern

mon

all this year,
The Demand for Common

will buy

of
under
the dollar averaging approach that
is favored among them.
Finally, mutual savings banks in)
New York have been buying com-/
stocks

common

$50 million of

single year.

they

$100

siderable part of the

1954.

Now

f

For open-end investment com¬
panies, we have statistics cover¬
ing sales of shares and redemptions in each quarter.
The latest

vestment in equities.
ities and Exchange

The Secur¬
Commission

issues

a

estimate

liquid

savings

quarterly
of

the

of\

American

{quarter shows that the open-end people. That shows liquid savings
investment trusts are selling ap- flowing into corporate equities in

proximately $100 million more of the

second

redeemed.

are million. But this figure includes
third pension funds as individuals, and

the

In

quarter, the figure was $107 million.
It
is a safe assumption,
-

comprises purchases of investment
funds. Eliminating these two eletherefore, that the open-end funds ments and putting the figures on

^will sell

'

"

■

approximately $400 mil-

an

annual basis, indicated net

purlion more in shares and certifi- chases of equities by individuals
cates than will be redeemed in all are at a rate of $500 million 4
«f 1954. That represents a net de- year.
mand for common
a

stocks^of almost

like amount, because

these funds

When Tom sells

a common

stock

-and Harry buys the common
stock,

"

tly-administered pension funds,
T am not concerned with pension
funds that are insured with life
Insurance companies; such funds
«re included with life
insurance
company

investments.

lecture

by

Dr. Bogen

a

series

sponsored by the Investment Association
«f New York in
cooperation with the
Graduate School of Business Administra¬
tion of New York University, New York
City, Oct. 28, 1954.




common equities.
That
what we'are trying to

measure.

Individual net purchases of
mon

any state

in which this announcement is circulated from

offer these securities in such state.

Blair & Co.

stocks, the SEC savings sta¬
tistics indicate, may be running at

Goldman, Sachs & Co,

Dick & Merle-Smith

L. F. Rothschild & Co.

Hemphill, Noyes & Co.

Carl M. Loeb, Rhoades

& Co.

F. S. Moseley & Co.

Incorporated

Schoellkopf, Hutton & Pomeroy, Inc.

Baxter, Williams & Co.
The Milwaukee

American Securities

Company

Corporation

Coffin & Burr
Incorporated

Laurence M. Marks & Co.

Auchincloss, Parker & Redpath

Shearson, Hammill & Co.
com¬

Halsey, Stuart & Co. Inc.

Corporation

Kidder, Peabody & Co.

uals. But if all Toms, Dicks and
Harrys together buy $500 million
of common stocks in excess of
sales, that measures the net dejust

be obtained in

Bear, Stearns & Co.

Hayden, Stone & Co.

Estimates mand for
in

The First Boston

Adams & Peck

is
*A

The Offering Circular may

only such of the undersigned and other dealers as may lawfully

into equities, and no net demand
for common stocks by individ-

Sep fully invested as a rule. • there is no flow of net savings
Secondly, we take the independ-

J

quarter totaled $300

certifier?* and shares than
?>eing

Price 101.93%
Plus accrued interest from December 1,1954

turn to individual in¬

we

Reynolds & Co.

Baker, Weeks & Co.

Cooley & Company

Gregory & Son
Incorporated

New York Hanseatic Corporation
F. S. Smithers & Co.

Weeden & Co.
Incorporated

Ball, Burge & Kraus

Hirsch & Co.

Wm. E. Pollock & Co., Inc.
R. S. Dickson & Company
Incorporated

The Commercial and Financial Chronicle
10

homes is still very

The Economic Outlook

The
•s

has been over for
long-term outlook
Expects rapid cyclical

Noting that the textile industry's recession
several months, Mr. Zelomek maintains its
is

favorable than in many years.

more

fluctuations to continue,

with flexibility of operations, requiring

;;
,

changeable machinery, becoming increasingly necessary. Pre¬
dicts industry's coming opportunities greatest in many years.

€)f the most important

i

u r

general outlook.
For

Ijast 30 years:

( 1 )
Should

the

that

tex¬

this

of

cycle

textile

more

cycle

o

f

Srea

What

eran o m v

1^in^icate^ isTnat

have trled tc,

ica .e ,i

,

^!reflsf prepo
?b^eJ^t°rs.

a

->

a

.

*

.

,

^
^

I have

growth.

have
nave

produc¬

*acl0rs

p°int°'lSl)

53

With

other significant factors I believe

have relatively greater

Wl11

we

asas-

.

cn

tion and sales.

(2)

.

** J** *

deals

Jgg?
chinerv.

e

i

4.1

text?le

nef
°£

a

JS^bilHon^nWeScompared^ith

W. Zelomek

indus¬

total

war

Textiles and

^SLS£tvsss»t

than

violent

trial

support

been

We-' have

EE

<

recom-

mending for years that the in- garments, which will be evident
for years that the in- gai sportswear as well, will def¬
dustry- introduce machinary that, in
initely help dollar sales. Bear in
mending

flexible. ITS IS e.V'tfCIHll V' uiittij .iicip
J5 [rnrp IieX'n'e. This is esnecially. m.

Ciuai xxx

ouu-o.

needed in view of the fact that
the consumer's ward- -,
there is no such thing as the use robe of dressy garments is low.
of a single specific fiber for a
(7) The continued trend toward
specific,, fabric. • It would seem to novelties and .the- diminishing
me' therefore," that the industry importance
of staples provides

and

is

the

*

asas¬

have

have
/
\

side) that the

my

will continue, with a
general trend upward in line with

pro¬

duction
eales

nave
have

I

assumed an
expansion in population from 159.6
million
in 1953 to
possibly 190

volatile.

are

The

I

is
growth of this LUUillljr- will conmis country
will V.U11tinue for years to come and that
the textile industry will reflect

industries

tile

i
I

believe

Fluctuations in the textilie

economy

(3) The long-term outlook for
the textile industry is more favorand the expected increase in the able t an in many years.
of cotton family formation beyond the next
(4) The proportion of income

*

•

Spendmg for

More

giUWUl

record

past

I

(and

in
great many on

the

note from

'

Government

»

iscussion
discussion

this

sumed

One
first

thetics.

assumptions about the

make some

the

n g

cars

(2)

of textiles. With try. While it would be foolhardy
on the road, re--to attempt to indicate what the

lihood that the trend will.be more; ^be marked
expansion in new
toward blends rather than all syn-' homes, the increasing population

We must first

things that omy as a whole.

Itave happened

million

use

requires laboratories may create, there is further growth of the American
of new no doubt that they will continue economy. In fact, fluctuations may
cars each year.
to provide new materials to meet be more rapid and the two-year
The synthetic textile industry— the
specific needs of industry, textile cycle may even be shortdominated by the chemical indus- Some of the new fibers, in fact, ened.
But as against that, the
try, always creators — will con- have industrial uses that are still declines and advances may not be
tinue to press for increased con-* being, explored.
as great in magnitude, short of
sumption. There is a strong like-,
j have previously indicated that further international tension.

Statistical Bureau, Inc.

President, International

its

placement demand alone
a
substantial production

ZELOMEK*

By A. W.
Economist and

creased

*5.4

Foi the Textile Industry

r

Thursday, November 25,1954

several months,'even though the
upturn has been only moderate.

the need for new hw competed with textiles in
great.
.
« the home.
Plastics and paper have
automobile industry has in- competed with textiles in in us-

Moreover,

etc.

<1

...

(2146)

exception of the
post-war

the

!

O) Therefore machinery which

matic looms, for example, in order

,.

changed easily from one
.
„,ni

<

-

-

>

Pnn™i

fpvfi1p_

e in<?>

^onsfderoWe^
a consiaewme

and the immediate

V

this

does

add

all

evervbodv talks about machinery oi greater fiexioiiity. •;>.
murine ouuook ior sustained
?wjam said <every!T
nmfit expenditures for plant and equip-

Twain said

to,

up

Se^dusto'tasTre^less thEfore** terms'of The textile

I believe that the greatest profit

tile

in gen-

industry

than

favorable

Musriy?'^dustry

S branches of?thejndi^tr? V.tt« While designing, merchan
hea^weightC garments, especially that;jCan^create something new, be most /mportanV neverthelesg
women's coats and men's over- something different,quickly when buying of raw materials and pricand can then
^the'^vera^
operations

re-

expect of our dynamic economy?

(3) Man-made fibers have been
introduced, and this has increased
competition and, at this stage atleast,
created, confusion among
consumers, retailers
and proceslers,
fiors.
However,
it has created

I believe that the textile indusi believe that the textile industry will respond more readily to

^

change

Qinee

™ats fofa woman's coat is
theS
ing policies will have to be hanthe rise in general business than\^ufor a woman^s coaU* con- tne^margin^ declines oeiow eco
effectively if: competitive
it has in the psst several years. I siderably higher than for a blouse nomic levels.
m
past
T,
•
lu
•'
j
positions are to be maintained. I
am optimistic about the future of J ar skirt, -any lag in sales of these _
I, have never agreed with the
more convinced than ever that
con

i

the

opportunities.

great new

and nobody does anything about

re-

textile industry.

*

,

T

,

.that it is better ,to maintain proStyle factors the trend iow^rd ,duction and lose money, especially
«lias-been adopted.
f
companies. These companies have oasuals and the decline in demand*.since the overhead costs continue
(5) New England has decreased an opportunity to reach new
dressier garments h^v^also • to go on.
,';. ;
in importance as a textile pro- heights; but I warn you there are a
Vf° iUm^ J?haps ,
^
d intA^ratiftn
ducer, while the South has gained, others that will fall by the way- you *hmk that style changqs ay>e ,
^
^
(6) However, there has been a side.
- as unpredictable and as unmanThe question of mergers and incarrowing of the wage differenHere again, time will not permit a£eable as the weather. But they,vtegrations is a subject in itself.
tial« between the North and the me to discuss at great length the
^anffes and
cln inflUence 'n!^peVer' 3
comments are ln
South, due to the increasing in- reasons why I am more optimistic
®^
we can influence place.
..
.
:
■dustrialization of the latter.
:
regarding the textile
industry^S VLpHipftwn qIvIp
that"
0nly a few years back' vertical
(7) Textile operations became than about the economy as a
.„p f
T
wiangeb uidi( integration was supposed to solve
more fully integrated during the
whole.. I shall summarize briefly NovelUe^are^ahfing^n contrast"?11 th®.P™ble7ts °' the industry
wa* and immediately afterward.'now, and then elaborate on some :
a
.
; Immediately after the war, belief
(4) Government support for the am optimistic orly,about intgllinatural fibers—cotton and wool— gently run, wellcmanaged. creative

„

for goTd^onomTcoun!

th"

I

However,

.

•

on total dollar volume.

»

s

^ ^11

*

greater^han

be

ever,

\

,
.

;
~

■

.

'■'

■

.

'

,

Sl^flpr HntplcOffpf

,,

T

wWIIvl HWwIS Vll™!
llHllAniVpiMttll M Cfi JO
UnflGlWlllfvll AI

gtatier Hotels Delaware Corp.

f

\s offering holders of common
.
stock of Hilton Hotels Corp. of
.record 3:3o p.m; (EST) Nov. 24,
ui
1054 rights to purchase 1 004,509
shares of Statler Hotels common
stock at ta 42 ner share The offer
ShJSMt^fi£^Ste'pre,!alled tha? ^ «»aU busines9on the
of one share'
X-nteses frmn it Secondly the maniJ Pnr'lcularly the converter, of statler Hotels eommon for each
?rpnrt 'toward dreisler earmmts k< would d>saPPear.
•
:
ishare of Haton'. Hotels commoft
a^in Innreasins
And alonl with
I maintained then that the con-.held and the rights will expire
,

,

of the points.

recently, this trend has been

More

partially reversed.
<8) There has been a steady de«l.ne

in

the amount of basic equip-

has been

chinery

to the

speeds,

fol-

?his, I ex^ct that
u,,;^

Population growth will continue.
•

ocin

im

(f

gain in ma=

machinery

youngsters, who wear
much more rapidly, will
6reater yardage.

effi-

ciency, and machinery hours.
(9) Casual garments and sportsincreased in importance

-

are the

lowing:

in

due

.

Among the imDortant factors in
the favorable outlook

\7wreasT 1 nTextheTroducfiori
textile production

*The
The increase

"

;

•

to-ywter would rise to a still small at 4:00 p mHilton stock Dec. also
(EST) on are 10
'important position, and the more Holders of

rrmsumm' invpntnrip<; of

«4 *»t does

Ws

top-notch raw ma-.being offered rights to purchase

marketing

the

presses.

elusion holds

equally true for the by cari m. Loeb; Rhoades & Co.
will
that the

Synthetics

new

"ouses and skirts increase^

tnanufacturing-retailers during the ning, the outlook is conducive to

period.
operation has lost some ground.

of

(12)There nas oeen
UZ) mere ha, been

sk>n

ih

the

sale

of

merchandise.

branded

also been

an

an
an

■

ments
effect

•

.

;

.

sportswear;
-With

an

Prospects

-

-

-•

These highlights provide a brief
nummary

the

of

revolutionary

changes that have occurred in the
industry
They provide a background against which we can make
.some

guesses

about the future

*

'

Yon
tnanv

Will

notp

of these

howpvpr

ch^ngerwRhin

industrv devplonpd

in

thnt

the

rpsnnntw^

to

important "outside" develonments
important outside developments,

increased

vmin^fprQ

baby

sifters

of

reverse

these ratios

reverse inebe wuos.

f
f

g
2
have problems to meet. It is more
the. growing de-, difficuit to merchandise novelties
in
than it is staples.- Novelties and
gC n dressier garments provide a

on a

x.

ta

that

It^ta

svn-

aues-

r

t

^

Most of us know that ther« bas
been a marked expansion in building and construction in this counJ1"7* The number °f new houses
has been increasing rapidly. This
year,may mark the second largest

-

greater challenge.

in

"more

S

I believe the

industry will rise to the occasion.
.

Home Furnishings and Industrials
,
While the greatest • portion of
textiles is used for apparel, nevertheless fabrics for home furnish2Snber of new houses ever built. IngS and industrial uses'represent
Thjs must mean more home fur_ considerabie yardage. The outlook
sheets, draperies, cur- for both is favorable, but hardly

♦A talk by Mr. Zelomek before the
Cvening and Extension Division, City Col- - tsuis, bedspreads, furniture, cot«ege of New York, n. Y.f Nov. is, 1954. ton or synthetic carpets and rugs,




tiallv

unsubscribed
,

T~"

T

saie of these

proceeds from

...in,

„

TJ- ." firma.associated wlttl
,n
S transactl0n-' t
Tie Statler properties consist of
h
,
j located 'in Bosn
r>

the;^L^al°^!f^n^\?^S'

equal to that for apparel.
'
Plastics as well as Fiberglas

anneal

^Pth

,

and nrice anf
th industfy and*

oonstrurtion

in

uanas

ana

tne

construction in uauas, ana tne

commercial real estate associated
use of ^
Statler Hotels in Boston
IS IiatS Duffsilo and Los Angeles. Such
'
commercial real estate consists of
flexibll>ty qf operations. . . an office buiMing in Boston, a
*
* • - Conclusion
press building and facilities m
Conclusion
Buffalo and an office building,
* lt 1S customary in a paper ^of stores and garage in Los Angeles,
tt is sort to summarize brie dy comprising together with the Los
what has previously been -dis- Angeles Statler Hotel, the develcussed in detaiL Tbi?,als0 ser7es opment known as the Statler Centhe purpose of crystallizing a few ter in that city.
highlights, which you can carry
Other members of the underaway withr you. My conclusions, writing group are: Allen & Co.;
fu.ZZTJ- Z* fniws' Lazard Freres & Co*; Wertheim
L
^
& Co-; HallSarten & Co-; Bear»
th

'eoinJ5.VS5 I»rel>-fabrics, however,; will; still pas

fhe ^ode^of l?^na
,

,

any

t

T

.

number

.^^aen.^y' JhuS
baSed
funda'mLtffchange
L ?

™^^'^6

-

in the world to take care of

and

'^The 1T,akers'of aPParel and ap-

and

^

,

.

s and creased 174.5%. I expect that inthe world to take care of the. cieveiand> Detroit, ■ St. Louis,
e• mean "the Period to come, the treind to-' mere^ing world needs. Moreover, Hartfordj Los Angeles and New
ward dressief clothes will pdr-r
under
synthetics, in combination York, the Statler Hotel „nHpr
s+nt1#ir

.

arnwintr

wanf stLe
StPh

Future

J g

adverse

garments

if^ win f?

p'nrv
supplementary yardage.
tary

increase in advertis-

.

casual

on

i^dusriv\owever

Yardage used, for overcoats and JPMKS jiave come in. 11is ques,
suits declined 8.5% and yardage tumable.naturalfibers produced
whether there can be
11qah
4;,pirpfQ js^rl tmnwrs inenough

lrpnH

mentt KS.™
is not having an

exoanexpan-

nationally
There has

big appropriations ,by fiber pro<3ucers,' as well as • promotional
tie-ins between garment manufacturers and retailers.

gn,-

displace

would

purchase

shares.

fortunate tot." a—V-"

through the war a rise in disposable income but In the mens wear trade'
the^
More recently, this type, not to a runaway inflation,
»«» are even more startiing., J"®.
and

depression

allot-

shares

This will be in addition to >rjal buying styling,
unsubscribed
on an
current, increased interest in ahd;merchandising^would be m a ment basis.
, .x
\
;
1 ■still stronger position.
My con-^
underwriting group headed

occur.

mean

As a result of the diffusion of

wear have

replacement

^2

Tf

h j

.

Growing

^

(1> The 1953-54 recession in t. e Stearns & Co.;* Ladenburg, Thalfor mann & Co.; and Sutro & Co.

textile industry has been over

***■>!« Kim—,,

Volume 180

Number 5380

..

The Commercial and Financial Chronicle

.

to

Petroleum Outlook and

(2147)

the

needs

the

of

finers will make

market,
than

more

retheir

a kind of semi-automatic
equilibrium.established between sup-

compressed many years of growth
into a relatively short time. It

Dep't,

(Indiana)

influence

So much for what

from

Boatwright discusses the outlook for the petroleum indus¬

business

of

many

^studies

outlook,

chasing

power,

have

you

of

els,

military-,,

b 1

for

e

supplies

the

on

dohand

one

concentrated into 1951,'52, and'55

With the Korean
was

crisis, a foreign

introduced into the

a building, of facilities that otherwise almost certainly would have

industry's behavior, been spread over a period of five
The government asked the.indus- or six years,
try to establish a security cushion "■ We began , to feel the results
of at .least one million barrels a. about the middle of 1953, and then
day of excess producing and, re- ^conditions were further complifining capacity.
There was no, eated by an unusually.fmild Winstrictly economic justification for ter. We have felt the full force
this added" capacity, because the of the results so far in 1954.1 The
market had not expanded to the whole supply and demand relarequested level. But /there was an tionship of equilibrium has been
admitted, obvious security need, thrown out of kilter.
petroleum

are

Over

certain

off on the periph->

are

years

by^foreign supplies on the behavior, and so they are economic titude of individual firms played rationalizing their behavior on an
.other.. I know, of .cpyrs^rtoi;^f^^,;^3^^,TOnscqu%n^^'>.ihey- are, various, parts in putting together incremental cost justification. And,
^tuatmn can be changed
real probTem&;7that. the small pieces that made up also naturally, the newer units had
.by government action-attheFed.- we must f^ce and solve, because the impressive whole; One firm distinct cost or quality ad van-,
;era! or State levels. At the moment,
they aregoing to figure largely stepped up drilling to provide stages, or both, over the older units,
^though, I see rthe supply situation jn determining Our future capital more production. Another- put in Inevitably there were shifts of

ing and taxa¬
tion, probable

a

mestic

ply and demand.

a span of less than three
Because our industry is cornthe people in the industry petitive—and only because of that
ery of what we normally think of provided even more than the re- "r^acb refiner began making hi»
as the petroleum economy.
They quested increase in capacity., I °wn adjustment to the unnatural
are notstrictly economic in origin, have seen estimate of as much as circumstance of excess capacity,
but they interfere, or threaten to 2,000,000 barrels daily of shut-in Naturally he used his newer cainterfere, with our normal business crude production capacity.-A mul- parity. Also, some ran older unit?,

and

fuel demand
for

What I have in mind

factors that

the economy will be met by

pur-

spend¬

planes,

known economic facts.

The only question really is

mand.

credit,

governt

than any
projection of supplydemand curves on the basis of

probable m what proportion the needs of

consumer

consumer

inventory levm e n

other problems that seem tcr me
to be of even, greater significance,

...

.

,

„

as
our

might call

a-day part that can be more or.
less accurately measured by statistics. -Now let's talk about a few

probable demand; Lists among the noncalculated risks inher¬
ent in the industry(l) Risks associated with the "cushion .?
concept";. (2) Risks associated with threats of disintegration;
and (3) The "high capacity" risk. Says we have witnessed in
a remarkably short time a radical
change in the industry, due
largely, to .quick expansion and quick modernization, and there¬
fore :"we are going-to face abnormal risks in our business *
because of building ahead of the market."

We

we

the volumetric part of the petroleum industry outlook, the barrels-

try in 1955 and gives statistical data regarding supply and

-1T

secu-

spring.

Assistant General Manager, Supply & Transportation

made

urgent appeal for the

cushion

Marginal, inefficient producers
fall by the wayside, and there is

shiit

seasonal

If

By JOHN W. BOATWRIGHT*

-

rity

output
gasoline to output of distillates,
they do not make this more-;
than-normal shift, we are going
to have a shortage of distillates
a
and
glut of gasoline before

Some Noncalculated Risks
Standard Oil Company

was an

and because rapid
tax amortization in some cases
offered advantages, the industry

usual
of

Mr.

put sooner or later contracts to
the size of the profitable demand,

11

/shapingup:

prob-

about as''shown in
Keep m mind that this

Table II.

:is

outlook

not

recommendation

a

what it should be but is my

particular

industries

T~ mate based

closely related

to

as

esti-

'to what it will be.

current trends, as

on

,

a new pipe line or bought a new
market position. Some refinery
barge. to insure more efficient were hurt. Some of the less effitransportation. Still another, added pient units in various refineries
We are all {amiliar with the
calculated risks inherent in our distillation or cracking units to have been shut down completely,
process
probably
business, iike the l-in-9 chance of get more or better refining capac- and this process probably will
continue. *
;
.
discovering oil with a rank wild- ity. And still another began mak-

requirements
profits

and

our

future

-

.

,

*

.

t

You'll note from the tables that

petroleum"

o

consumption

I estimate

and

mand

many

other

factors

bearing

on

v

the

i

.

«,

D

•

.

u.

John W, Boatwright

4.3% increase in de¬

a

and-

4.4%

a

increase

;

in

our

.

,

,

this

is

a

.

..

.,

.......

.

.

,

...

,

/ We

all have

been

the

that

long accus¬
in

comes

a

highly

competitive market under normal,

we

witnessed in

a

remark¬

ably short time was a radical
change in the industry. We had
both a ■ quick expansion and a
quick modernization,

The forces of

production/strive

constantly.; to in the

turn out

a

It's

.

worth

noting

that—except

case^ of certain alkylation
facilities—much of this industry

supply that will satisfy

the: factor tot

taken place anyway as a.result

think;

of

that the government did offer
inp,nfiv.

nf

erated

amortization.

will Jfrom

now

on-have-to operate

,.

J™:

-

,

«

1955

,l9oo estimated

- -

.

.uaV~7~
Stimated """

much, I know, you are
acutely aware of, and I review it
only to set in context another,
consequent problem that I'm afraid
sometimes overlook,

we

other problem arises front

This

•

the

fact that

competition in the
considerable
of additional building.

industry will
amount

cause a

A more modern

say,

in

any

refinery is built,
given area, equipped

with the latest facilities fOr iowcost operation, and it begins turn-

expansion would eventually have ing out products.' 4 Will its

Some;

ih;the',light ro£rv stocks* on*hand.,
However/based> on -thia.*forecast, ,
the oil industry in all its phases.

So

,

natural conditions.

is

•»

pose greases, or any other of the
more than 2,000 products that can
be made from petroleum.
What

tomed to the kind of expansion of

facilities

mg new products—petrochemicals,
or new motor oils, or multi-pur¬

-•

for 1954 probably , will aver- thn hoped-for profitable demand,

priory assumption that ..runs
weather

the noncalcu-

iablp risks

The small difference is> * v
<
Risks Associated With
accounted for by expected changes
g{ (jtpcta>
Cushion Conceptr

.

_

are

now

supply.

products. I
Crude Runs
shall not go into .the detail of any
Given this demand
and this
of this background work. Rather, supply, what will, be the crude
with your permission, let us move, runs to stills in 1955?
Because
directly to the estimate of 1955 the industry has been drawing
petroleum demand.
•
down excess stocks of. gasoline
and and distillates
If the weather is normal—and and distillates during this year,
of

direct attention

'

future level of

consumption

These to which I would

cat.

i

petltors

'

rapM

Bnt because, there

•

Or

a

have to

new

match

.

/,z79..

at:, higher, levels- than' have- been
»■ There
are
two, points : about
experienced during 1954; -• / ■. crude runs that deserve recogniThis
:

Petroleum Supplies.

rr,„n

S
supplies
to meet

_

■

| * An address by Mr. Boatwright at the
Annual. Convention
of
the
American

Chicago,

Institute,
Nov. 10, 1954.

is neither

an

The

(1) If we have a normal winter
by Weather Bureau definitions,

offer to sell nor a solicitation of an offer to buy
offeris madeonly bythz Prospectus.',-

any

of - these shares.
■-*../

.

♦£ oinSt!
.are more
^an adejua e
this estimated greater de-

Petroleum

announcement

*10nv

>

Qn

,

runs during

this fourth'quarter of

the first quarter

1954

NEW ISSUE

of 1955

1*004,509 Shares

should averagO- approximately
7,200,000 barrels a day.

Illinois,

/ox

,

,

.,

(2) If the industry adjusts fully

/

TABLE

Statler Hotels

1

Estimated Demand All Oils—1955
*

000

Delaware

% Change

B/D

Domestic:

.1——

Gasoline
Kerosene

3,500
330
1,560
180
1,500
1,110

.

—

Distillates
Jet fuel

:

Residual

—

-

All other —-

Total

-

"

($1.00 Par Value)
As

30

—18.9

250

—18.6

280

—18.6

8,460

Total

-

demand all oils
TABLE

NGL, etc.-

Total

5

,-

.

Estimated

^

1955

6,388
" 680

domestic production

7,068

7,370

%

new

662
402/

710,
410.

o.9
"

.

4.3

Carl M. Loeb,

7.2
2.0.

1,064

1,120

5.3

supply all oils

8,132

8,490

4.4




Share

deakrs

November

Total

per

such of

4^#

720

—-

Total imports

Prospectus.

Copies of the Prospectus may be obtained, in any State only from
the several underwriter^ including the undersigned, and other
or brokers as. may lauxftdlywffer:.these-securities in such States

Change

6,650

—

Imports crude oil
*
Imports refined products

stock of Hilton Hotels

'

1954

Domestic

common

Oils—1955

Estimated

crude production—_

Prospectus, holders of the

Subscription Price $6.42

<ooo of-B/n>

Domestic

forth in the

n

Estimated Supply of All

-

forth in the

4.3

products

Total

set

Corporation (other than certain of its officers and directors and their associates)
are
being offered the right to subscribe for the above shares at the rate of one
share for each share of Hilton Hotels Corporation common stock. The subscrip¬
tion offer will expire at 4 P.M., Eastern Standard Time, on December 10, 1954.
Any shares not subscribed for may hereafter be offered by the underwriters, as set

Exports:
Crude
Refined

Corporation

Gommon Stock

*

5.3

8,180

—

-

3.6
1.5
8.6
35.3
2.7
7.3

2d, 1954,

cost

large-diameter pipd

7279 '

---

com-*

fwBxat is bailt to Chicago. Can com-r
•
31f

~nnn

.

its

Rhoades & Co.

*

\

The Commercial and Financial
12

by

reports
In

Regulation

nancial
to be

movement of

foreign countries (other than Can¬
ada) has been represented in great

m

n

grants, by
government

(2) That

in

abroad

subsidiaries by

interthe

V

„

/,

sion has nothing to do.

The Com¬

jurisdiction with respect

capital advances by parent cor¬

is quite

porations to subsidiaries
limited.

However, if the world
develops as we hope it will, its
economic progress will be based
substantial flow of private

upon a

investment

have

international

across

boundaries

that

with

and

do

we

something to do.
United

The

emerged

which
creditor nation after

as a

States,

World War I, has perhaps less ex¬

in

perience
ment

international
have

than

Western

invest¬
of

many

our

friends. The
complex processes,
the varying
languages, the multiple laws, the
differing customs,
the involved
techniques, call for skill and ex¬
perience. The intelligent direction
of foreign investment calls for a
European

certain

amount

is

what

of

sug¬

gested by a popular song entitled
"Getting to Know You."
'*
It is to be hoped and expected
that

the

over

of

movement

tional

quired

to

living

of

the

years

capital

investments

standards

the

and

investment.

to

also

re¬

of
the world will be less
raise

loans and

by inter-governmental
It

more

would

expect

for

capital

interna¬

that

by private
normal

be

of

source

a

invest¬

private

such

ment would be the United States.

The

outflow

pri¬

of

Federal

several

the

with

administering

of

responsibility

the

of

agency

an

charged

Government

Securities and Exchange Commis¬

to

is

Commission

Exchange

and

Securities

The

Ralph H. Demmler

governmental

mission's

to

as

substantially
in
solving
problems relating to remittance of
profits and repatriation of capital.

porations.

relations

such amount

in

are

payments

net

our

assist

American corWith

is

capital

American

((1) That

seeking investment abroad, and

and by

loans*

investment

any

accuracy

the

approve

which

statutes

protection for in¬
the public in their

seek to provide

and

vestors

security transactions.
We have

this country
regulating the

set up in

Federal

a

system

of

securities based generally

the

furnishing to investors of

sale
on

Securities

for exchange

offered

or indirectly for soliciting
exchange are exempt from

directly

registration procedures. However,
such
offerings are not exempt

of Section 17
the Securities Act and Section
of the Securities Exchange Act,

security

sanctions, both penal
are
imposed for misrepresenta¬
tion

Under that

concealment.

or

philosophy the investor is free to
wise

select either

a

investment.

The

sures

or

unwise

an

merely as¬
that he has adequate oppor¬

tunity

find

to

what

out

is

he

buying.

of

Federal securities regulations

our

is

philosophy

basic

disclosure, the import¬
accurate accounting in¬

of

once

of

ance

under

furnished

formation

this

mention

I

changes

ex¬

because

securities

of

of

matter

we

Commission's

The

accountants.

in

be

must

countant

stand¬

good

ing and entitled to practice under
the laws of the place of his resi¬
dence

over, any

principal office. More¬
such certifying account¬

ant

be

or

must

that

is, he

in

fact

independent,

not have

may

fi¬

anv

in the organization;

whose accounts
be certifies. Nor may he be a nromoter. underwriter,4 voting trus¬
tee, director, officer or employee.

gen¬

of the value or
a

determinative

most

information

potential value of

security and the progress of its
is the financial condition

issuer
of

business

a

the

and

financial

operations. Such in¬
can
only be derived

results of its

formation

issuer's financial

the

from
ments

prepared

accurately

state¬

and

uncolored; and disclosing

material fact necessary to

In resoect of accounts filed with

authorize the Commission to presscribe

the

shown

in

earnings
to

items

the

or

details

the

statement,

be followed

in

be

to

sheet

balance

and

methods

the preparation

anoraisal or
evaluation of assets and liabilities,
in the determination of deprecia¬
tion and depletion, in the differ¬
of

in

accounts,

entiation

the

recurring

of

and

In addition the subsidiaries
abroad of United States compan¬

ing.

income accounts.

ies have reinvested earnings at an

either the issuer

per

year.

of $600 million

during this six

year

per

period.

year

that has taken
balance of payments

change

of

rest

the

States

in

and

that

amount

to

In

we

1949,

balance

our

Act of

securities

certain

1934.

which

requires the disclosure of certain
information, in the sale of new

tent

securities and

this

foreign

they

were

their

coun¬

that

us

accounts.

in approximate

there

payments either

paid

and

were

no

net

But in the

way.

for

Securities Act of

will

know

under

our

transactions with the rest

*An

the

New

address

American

by

Mr.

Institute

about

$7,700,-

Demmler
of

before

Accountants.

York, N. Y.




he

is

mission.

Exchange Com¬

The Securities Exchange

provides for the filing
with the Commission of basic in¬
formation when a security is listed
an

identified

as

Regulation

specify the form and con¬

of

the

financial

regulation

Series

composed

are

the

Account¬

which

of

are

opinions

Releases

mainly

statements

Included in

required to be filed.

ing

S-X,

exchange and for periodic

in

prepared

are

with

financial

ac¬

accounting princi¬

will

statements

to

be

be

misleading

pre¬

or

inac¬

disclosures

despite

con¬

quirements, usually involving tax
considerations, it appears that
concepts of accounting which
are not recognized
in the United
States are generally accepted
abroad. For example, it has been

some

represented to us that it is accept¬
practice in the Netherlands

able

in determining net income to

base

provisions on esti¬
replacement value rather

depreciation
mated
than

historical cost.

on

tained in the certificate of the ac¬

Very real questions frequently
count or in footnotes to the state¬ are
posed by the arithmetical im¬
ments provided the matters inpossibility of converting the result
volved are material.. In cases achieved
by one method of ac¬
where
there is a
difference of counting into
the result which
opinion between the Commission would have been achieved by the
and the registrant as to the proper application of another method.
principles of accounting to be fol¬
lowed, disclosure will be accepted
in lieu of correction of the financ¬
themselves

statements

only if

points involved are such that
authoritative

substantial

is

there

ously been expressed in rules, reg¬
ulations, or other official releases
of the Commission, including the

published opinions of its chief ac¬
countant."

•

.

The application of the principle
in

stated

Release

Differences

certifying
confined

opinion

of

among

not
and

accountants
are
to the preparation

ments but

reflected

are

the procedures
in auditing

state¬

financial

of

presentation

well in

as

followed by them

the accounts and rec¬

ords which form the basis

of the

In this

financial statements.

coun¬

try compliance with generally ac¬
cepted auditing standards requires
that

the

auditor

shall,

whenever

practicable
and
reasonable,
be
present at the inventory taking
and

suitable observation

by

and

No. 4 naturally

well founded.
The

sion,
view

our

approach has been to re¬

statements

termine

whe+^er

principles

as

filed

the

reflected

to

de¬

accounting

therein

and

the methods followed in their pre¬

paration

are

which

sound and generally

ial

variety of problems

great

to the attention of the

come

Commission

almost daily

strates quite

clearly that account¬

demon¬

branch of mathematics
like arithmetic or geometry and
consequently as a practical mat¬
ing is not

ter
of

a

made?, the

be

cannot

rigid rules.

there

are

of

country agree

to treatment in financial state¬

ments.
some

During the short period—

15 months—that I have been

Chairman

of

the

Commission,

these matters

of

some

brought to

have

been

For

attention.

our

ex¬

reflected in
financial statements a variety of
methods of accounting for stock
options issued by corporations to

ample,

have

we

their

officers

have

listened

seen

and
to

employees;
arguments

cerning accounting for

we

con¬

emergency

facilities part of the cost of which
under

tized

tax laws may be amor¬
a five year period;
we

our
over

have had

tical

discussions—some prac¬
and some academic—on de¬

partures from cost in the handling
of depreciation and have declined
formal

application

adopt

to

a

requirement that economic depre¬
ciation ((based on replacement at
current

prices) be reflected either
other appro¬

in the accounts or by

priate disclosures; and more often
than one would expect we have
found

it

necessary

to

comment

balance sheet
when made
a public offering

critically

upon

write-ups

especially

concurrent with

have

also

had to

give

con¬

sideration

to

companies

offering securities for

sale

in

the

financial

to the

filings
United

statements

of

foreign

States.

The

contained

in

such filings for the most part have

certifying

accountants

again

the

have

not

connection

this

In

"*

*

*

letter came in the

a

It was interest¬

tralian subsidiary.

ing to see the emphasis they
placed on stock (inventory) veri¬
fication at balance date and on the
stocks* during

of

movement

with the accountants

this country, as to

in

the basic prin¬

ciples underlying the preparation

the

* * * it is interesting to note
how insistent they were on obser¬
year

of

vation

stock-taking.

physical

impression is that English
practice
is
veering
inevitably
towards the American view on the

My

point, though not to the extreme
followed
in
the
McKesson and
Robbins case."

foregoing partial list

the

From

accounting and auditing prob¬
lems with which the Commission
of

is

confronted, it is apparent that

some

degree of

turmoil exists with

respect to the financial
of
domestic
issuers, a

reporting
situation

somewhat
greater degree when statements of
foreign issuers become involved.
As ' one
prominent Netherlands

which

is

present

in

summarized

has

accountant

it,

particular case one has
to deal with a great number of
countries the obstacles mount to

"When in

such

an

a

extent that, in consolidat¬

compiling the various data,
you feel as if you mix a cocktail
of 'good old Scotch'
and water
or

from the canals of

Venice."2 How¬

when one considers the vast
complex presented by the prob¬
ever,

lems of

industry, it is some com¬

that the areas of controversy

relatively

You

can

small.

so

see

presented to
1 Volume

or

other

associates cover¬
ing the required audit of an Aus¬

that questions

1954,

p.

2 The

No.

are

in specific cases.

us

always agreed, either among them¬
selves

there

day from English

are

in their respec¬

as

cently the following abstract from
the "Diary of A Chartered Ac¬
countant" published in "The Char¬
tered Accountant in Australia."1

countants located

Here

manner

brought to my attention re¬

was

fort

countries.

having sat¬

some

credibility of the amounts

ables.

been certified by independent ac¬
tive

in

shown for inventories and receiv¬

ing

of securities.
We

statements without

isfied himself

matters

which not all of the

accountants in this
as

subject

It is apparent that
number

a

concerning

on

specific accounting questions.
With respect to the accounting
principles underlying the financial

annual financial

Act of 1934

on

Utility

statements filed with the Commis¬

the Securities and

of the world added

to

reports with

1953, the reversal
and

relation

the Commis¬

the Act also undertakes to

file

pronounced,

what

getting when he buys securities.
Any issuer registering securities

last four years, from 1950 through
was

1933, the

prescribes standards
such information, so that the

investor

con¬

Holding Company
Act. adopted general rules pres¬
cribing principles of accounting.
We have adopted a set of rules,

so-called "truth-in-securities law,"

balances

power

except in the case of
companies subject to the

Public

of $41/2 billion in

The

broad
it with

matters,

national

are

1934

ples for which there is no sub¬
stantial authoritative support, such

a

sion has not,

the

a

upon

accounting

securities

governed respec¬
tively by the Securities Act of
1933 and the Securities Exchange
exchanges

ferred

net

settle

and

by persons in

of

issuers

of

on

or

issuer, and the obli¬

with

from

is,

of

listed

an

the

Despite

in

world

dollar

investments

tries;

1946

years

transactions

resulted

collection by us

gold

the

control of

gations

It is also significant to note the

place in our
position.
During
through 1948 the

Public offerings of securities by

Exchange

Securities

the

or

of

non¬

recurring income, in the differen¬
tiation of investment and operat¬

make the statements not mislead¬

$900 million

average of

extent, accounting principles upon

inquiry satisfy himself as to the
gives rise to the possibility of dis¬ methods followed, and shall con¬
outstanding securities.
agreement and uncertainty with firm accounts and notes receiv¬
Financial statements of issuers
respect to particular statements able by direct communication with
filed with the Securities and Ex¬
and specific problems.
If a regis¬ the debtors. It is my understand¬
change
Commission
under
the trant makes a filing stating ac¬
ing that these procedures are not
Securities Act of
1933 and
the counts
based upon principles for
mandatory in England or Ger¬
Securities Exchange Act of 1934
which it claims there is substantial many and perhaps in other coun¬
are,
with minor exceptions, re¬ authoritative support, there can
tries.
I understand, however, that
quired to be certified by inde¬ readily
arise
arguments
as
to in those countries the independent
pendent public or certified public whether the claim for support is
accountant will not certify financ¬

ing income, and in the preparation
of consolidated balance sheets and

the

1933
Act

cordance

anticipate that from time to time
foreign issues will be making of¬
securities for

that, to some

appears

fers to exchange new

erally accepted principles is read¬ it. the Commission is given broad
ily apparent. It is only a state¬ authority. Both the Securities Act
ment of the obvious to say that the and the Securities Exchange Act

every

United

pursuant to its rules and regula¬
tions under the Securities Act of

by the registrant and the position
of the Commission has not previ¬

nancial interest direct or indirect

the

Since

did and

important

with this Commission

support for the practices followed

discussed
would
provide
analogies in
determining ques¬
tions of civil liability or violation.

law

in the last six years has been ap¬

aggregate

average

where financial state¬

ments filed

issuer.

proximately $5 billion $4 million,
an

cases

and

previ¬

standards

disclosure

follows:

as

"In

fraud

to

respect

its

and

presented in such a manner as to
be informative but concise; can¬

or

1938,

the

ously

"

.

it

While

which financial statements of for¬

ial

the

presentation of the financial

statements.

eign issuers are based are derived
from
specific governmental re¬

from the application

and concealment in securities

and

Series

curate

an

such

or

sumed

issuer with its existing se¬
curity holders exclusively where
no remuneration is paid or given
by

delisting
proceedings.
is stated in Accounting
Release No. 4, April 25,

order

Commsi-

the
requirements
pertaining to
the
Legal qualification of certifying account¬
and civil, ants are rigorous.
Such an ac¬

with

information

vate capital from the United States

'

Thursday, November 25,1954

...

This policy

representation as
or completeness

the

such; if not, to sug¬

as

gest that the statements should be
amended in order to avoid stop-

of

The outflow of investment cap¬

t

n

re¬

The Commission

ital, plus the balance of payments
10
position would seem to indicate
which deal generally with
the validity, of two conclusions:

but
e

$1V2

counts.

rather by govr,

the

to

the information.

of

1954 will witness
billion flowing to

inaccurate the

does

nor

make

the

to

fi¬

to

authority

however,

securities

foreign countries to settle our ac¬

curities by in¬
dividual in¬

not,

sion

continuing and

is

year

another

by acquisition
of foreign se¬

vestors,

trend

ing

our

permit the statement to be¬

does

gold and dollars. Based upon pres¬
ent available figures, the outgo¬
calendar

not

measure,

by

If it appears

or

effective.

countries' assets in

000 to foreign

state¬

respect

has

come

develop better corporate accounting practices."
recent years
American capital to

incomplete

fuse to

rules. Asserts, however, "our Com¬
knowledge and legal support

in

examined

statements.

Commission

mission will continue to lend its

know,

registration

with

quirements

in relation to accounting rules, but, except in the admin¬
istration of the Public Utility Holding Company Act, has

you

is

which

Exchange

plies with applicable disclosure
requirements
including the
re¬

powers

As

a

files

issuer

the

recognized

staff to determine whether it com¬

points out the significant role of accounting in the regulation
of the issue and marketing of securities. Holds SEC has broad

to

with the Securi¬

1933

of

ment

Exchange Commission

international movement of capital as a means
living standards. Chairman Demmler

deferred making accounting

Act

Commission

raising worldwide

of

listed

of

with the Securities and

DEMMLER*

By RALPH H.
Chairman, Securities and

After discussing

issuers

complying

ties

Securities
I

the

securities.

Accounting and

e

Chronicle

(2148)

XXIV,

No.

10,

April

20,

727.
Accountant,

4082, Majch
Kraayenhof).

14,

Volume

1953,

CXXVI1I,
p. 299 (J.

Number 5380

Volume 180

.

The Commercial and Financial Chronicle

..

Chronicle and

Consequently, it is difficult to be
specific in stating over-all policy.
The
of

legitimate

ican

mutual

interest

abroad

naturally

suggests removal of needless bar¬
to
to

sues

the

of

foreign is¬
American capital markets.
access

On the other hand

position

formation

similar

that

to

which

they receive in respect of domestic
Moreover, from our stand¬
point as a regulatory agency, an

issues.

imposition
closure

complete

less

of

requirements

dis¬

similar relaxation of requirements
in: respect

of domestic issues. -In

other words,

it is normal to expect
that American companies will de¬
mand "most favored nation
ment" in their

This

country.

own

retrogression for which

be

should

Commission

our

treat¬

be

not

asked to take responsibility.

closure,

high standards for in¬

our

dependent accountants, our insist¬
ence

sound accounting prin¬

upon

ciples. and the requirement for the

of

furnishing
luminous
ules

the

relatively
and

statements

vo¬
sched¬

have, over a period , of 21
materially raised American

years,

accounting standards and have af¬
forded

a

very

tection

American

to

There

real degree of pro¬

no

was

investors.

absence

of

this.

But

the

over-all

result

has been

good. Consequently, the
accounting standards which we
have helped to evolve have in a
sense become a part of the mores
of the

that

capital markets.

American

In

of its faithful admirers.

one

forum

are

we

given

business"

as

then

Chronicle

and

bound

a

was

Its tabloid form

later, but for $10

the

the sub¬
only the 52 weekly

per

scriber received not

issues but 12 Bank &

annum

1

Quotation supple¬

ments, two semi-annual issues devoted to

coming electric generating industry,
Railroad: Earnings Compendiums,

:

The front

of each Chronicle issue carried the cards of various
banking houses under the heading "Bankers and Drawers
of Bills of Exchange." It was a select company and I am
proud of the fact that during the 20 years of my appren¬
ticeship the card of my firm appeared there every week.:
page

v

Since there

then no prescribed course of training
Banking field, whatever knowledge the

was

in the Investment

student

acquired

educators of

part of the training

modern financial

our

program,

.

analysts. About 1900 a

recognized by foreign enterprises
Which
seek
capital funds from

private investors.

dents and

this

is

fact

There

are

to solve

which

one

must

magic

no

be

formulas

the

perplexing questions
which I have mentioned tonight
nor many of the questions
which
will hear discussed next week.

you

It may

be that at some future date

there will be debates

on

the

same

at an International
stitute of Accountants.

people

does

people who

com¬

organization
the

when

of

it know the facts. Our Com¬
mission has loaned, and will con¬
pose

tinue

lend, its knowledge and

to

legal support to those who help to

develop better and more informa¬
tive
corporate accounting prac¬
tices.

It has

goaded

a

good

many

stragglers into falling into line.
As

contemplate the place of

we

sound

accounting

Information

as

the

in

a

medium of

international

capital, I hope that
there is general agreement with
the philosophy of adequate dis¬

movement

espouse

of

which

closure

have

I

tried

to

(Special

to The Financial

FRANCISCO,

Malcolm

McNaghten,

Thomas

L.

Schuette

Chronicle)

Calif.
Jr.
have

—

and
been

added to the staff of Schwabacher
&

Co., 609 Market Street, mem¬
of

bers

the

Francisco

McNaghten
Dean

New

Witter

was

&

York

his text book
the

Mr.

previously

with

SAN

C,

Kennedy

earlier testifying

years

Railroad

on

the adop¬

Act; with Dr. Daggett in

Reorganizations acknowledging

of

reserve

sound dollar.

a

must

we

we

the .statistician at

His mark

followed

course

—

been

Co., 45 Montgomery Street,

members

of

the

New

San Francisco Stock

York

and

Exchanges.




by

every

that

nation

embraces

;

upon every

was

now
may not be able to see this desirable conclusion "
in prospect, but can be assured that the Chronicle will as j;

usual, present every opinion, and remain

the

on

conserva¬

tive side.

With Ball, Burge, Kraus

Singer, Beane Wire
;

To Fewel

Coast

on

40

Exchange

Place,

New

Ball,

&

of

direct

a

wire

now

Burge1 !&

Second

City, have announced the instal¬
lation

DAYTON,' Ohio

Smallwood is

Street.

I testified

but I

once

am sure

The

that I had

this is

an

discovered

an

Kraus,

120

West

*

-

Now With C. A. Goodwin

Fewel

to

SALEM, Ohio—Leonard Rotolo
joined Chas. A. Goodwin &>

Co. in Los Angeles.

has

Masonic Building.
He was
previously with Zilka, Smither &
Co., Inc./

Co.,

Joins H. O. Peet Staff
(Special to The Financial Chronicle)

KANSAS
E.

Winters,

CITY,

Jr,.

-

*

'
,

•

'

•

has

joined

the

staff of H. O. Peet & Co., 23 West
10th Street,

members of the New

York

Midwest

Stock

Ex¬

changes.

This advertisement is neither

offers to buy

Bartram,

Barj'

Corporation,

New

W.

■

tram

Brothers

York

City,
at

passed

away

at

the age of 80.

a

offer to sell

nor a

solicitation of

only by the prospectus.

November 23,

New Issue

1954

182,984

Weco Products

Company

Common Shares

Chronicle, like Charles Anderson Dana's "Sun"

The business office of the Chronicle

was

presided

($1 Par Value)

Price $13.50 per

share

over

by Mr. Morrison, later succeeded by his assistant, Bill

Copies of the Prospectus may
underwriters

as

may

be obtained from such of the

lawfully offer these securities in

several

this State.

The printing plant, editorial offices and business
were

two

in the
to

see

building, and it

same

that

years,

deadlines

were

Redmond & Co.'s

appeared opposite the first

the first

page

Saturday in each month.

jealous of this
the copy
not

an

of these securities. The offering

probably read 200 indentures,

(morning and evening) had an authoritative tone, believed
free enterprise, property rights, individual initiative,
the Gold Standard, and the principles of the Republican
party. When the "Sun" published its famous one line edi¬
torial the day after the election in 1904 ("Theodore! With
All Thy Faults") the Chronicle was not far behind in its
criticism of the Pujo Investigation and trust busting
activities. The Chronicle editorials adhered to the capi¬
talistic line and were vigorous.

ment

any

is made

Not

was

the duty of
and

met

one page

all

ran

Bacon, Whipple & Co.

advertise¬

of reading matter,

Cur competitors

were

Piper, Jaffray &

there

wait.

All

space, so
was

I

whenever I

was

late in sending

always the threat that the

remember,

now,

is

that

paper

could

somehow

the

4

Rensselaer W. Bartram
Rennselaer

home

and

•

*

Mo. —George

error.

understatement.

I:

Tbomas

—

associated with

York

one

market afforded, and sometimes we

;

We

Johnston, Lemon &

Co.

Central

Republic Company

(Incorporated)

Walston & Co.

Hopwood

Rauscher, Pierce & Co.,

added to the staff of Dean Witter
&

add the debt and the
money sup- *

our Treasury will indicate in no uncertain
that the price of gold will not be
raised, but that

in greater or

less
who followed him. He undoubt¬
edly laid down the two rules, that we must read the
Chronicle weekly, and the bond sales in the newspaper
daily. Of greater influence was Arnold Dana's insistence
upon thoroughness and the use of original sources.
His
office library included a full set of the Chronicle, and its
predecessor, "Hunts Merchants Magazine," plus a very im¬
portant collection of original texts. These included mort¬
gages, indentures, leases, reports, etc., which we were re¬
quired to read and compare with the summaries that the
degree

smoothly. For

Calif.
has

;

k

can

careers.

nephew of William B. Dana, had been
Redmond & Co., but, left to become an

editor of the Chronicle.

these

to The Financial Chronicle)

FRANCISCO,

few

about to start their

Riggs.

Co.

Witter Adds to Staff

William

on

assistance

office

(Special

a

"young Professor Ripley of Harvard
University." Many of those analysts and economists whom
we came to
respect after the first World War were just

San

and

Exchanges.

Stock

only

by direct grant.

price tag on gold, the rate of
ratio; but seldom think of convertibility

in

in these remarks.

Schwabacher Adds Two
SAN

but also

Arnold Dana, a

Accounting is basically a tech¬
nique of reflecting financial facts
The traditional free press in this
country testifies to the belief that
best

war

We still tinker with the

more

tion of the Interstate Commerce

*

many

In¬

subjects

an

as

Singer, Beane & Mackie,«Inc.,

which
usually lasted from two to four years, fell upon the
"statisticians," so called, who were the predecessors and
heaviest

a

effort will be made to provide convertibility at the
earliest moment, meanwhile
reducing expenditures. It is
time to admit that Christmas is over and the bills are due.

reading.
The

conducted

every

general interest was being taken in the field of eco¬
nomics.
Perhaps there were as many as 50 competent
analysts engaged in financial circles at that time. In a
broader field, we find Dr. Hadley still lecturing to stu¬

And, I think it fair to suggest that

almost

are

inflation.

and

doing, observing

through

came

has

Perhaps

Hubert F. Atwater

American Bankers Convention issue.

one

many

terms

four
and

Chronicle

policy of the Administration, and has
contributors space for their ideas. We find

ply, then divide by the number of ounces of gold and get a i
price that will do just what Adam Smith said in 1776 was ;

to come

was

the

the fiscal

there

Jf

weekly, about 8V2 X14 and resembled
the
"Congressional Record" ; and the
"Statist."

months

recent
on

interest,

the Chronicle
The

a

after the first
•

September .of 1906 was to read
regularly.

in

the subscribers'

on

recommendations to in¬
crease the
price of gold as there are to adhere to a more
conservative policy. We still are
looking for ways of ex¬
pending our income abroad, not only by means of loans

when

received

Co.

that

One of the first directives 1
I started to "learn the
in the offices of Redmond &

example.

com¬

plaint about the inconvenience of
all

will

by the Publisher

accepting the help and advice of
thanks, although we have in mind
sometime we will get around to it.
Take the Commercial and Financial Chronicle as an
often

Too

the

Our legal requirements for dis¬

from

were

standard bearers of the Chronicle have
respected and authoritative publication and
probably add to its stature.
' -

inherited

others without proper

foreign

on

issues would lead to demand for a

would

of this newspaper

advertisement

our

Saturday morning.

The present

ATWATER

An unsolicited testimonial received

to insist upon receiv¬

ing in respect of foreign issues in¬

desks

t

in view of the

availability to American investors
of relatively attractive investment
opportunities at home, they are
in

By HUBERT F.

encouraging Amer¬

investment

riers

"A Salute to the Chronicle''

people and the peoples of

our

other lands in

13

(2149)

Inc.

McCormick & Co.

Fairman, Harris & Company, Inc.

Mason-Hagan, Inc.

Courts & Co.

A

his

The Commercial and Financial Chronicle'..

1953.
It will be noticed that a
number of the tax bases itemized
in Table I are also used by the

negligible, tax collections adjusted

States Collect More Taxes in 19S4

for

population and price changes
went from $27 in 1941 to $38 in

*

quantitative

reveals

fered

(exclusive of Social Security) by the Federal Government, the
municipalities will collect approximately $22 billion.

|/

large

total tax

The

That taxes by state

remain

high

recent

governments
confirmed by a
from
the Census

is

report

Bureau

which

shows

the 48

high of $11,072

half

1954,

billion

a

than

more

in

1953.

Although
is

this

prelimi¬

a

little

very

mention

To

that

before

were

World

War

state

taxes

II

only $3.6 billion gives point
steady climb of this part

lo

the

of

the tax

liad

bill.

about

currently

4£11

Local

the

taxes

have

same

history, and
at,approximately

stand

billion—an

estimated

figure

toecause

complete coverage by
Census of all local governments is
feasible only at decennial periods.
The major item in the total tax

figure is

the

Federal
million

in

■Social

Federal

tax

levy. With
ol;$63.5

collections

fiscal

1954

Security)

(excluding

it is difficult to

recall that in the

1920's the

figure

got down to around $4 billion 2md

be

how

Effect

of

figures
of

traced

be

can

mental

comparisons.

capita basis
bill

tax

World

lections

respective
1954

pre-

amounts

compared

with

The obvious

comment

which

popula¬
tion growth is that whereas state
tax revenue increased 2xk times in

the

subsidies

orthodox

of

the grand

variations

Federal

more

serv¬

operational
been the

have

quasi

the

and

wars,

the

-

welfare

state.
There

are

enues

take just

to

mean

much to any of us, but on a
daily
basis it drops to about $236 mil¬
lion. Reduce this further to hours
and then to
minutes, it continues

make

to

number of

a

of

possible

correlating tax

with population.

appropriate word—is $85.6 billion.
Vhis

large

rev¬

One could

the adults who after all

each

remain

collected
ments

in

Gtate,

day

startling: $163,000 was
by the various govern¬
this

local)

country

(Federal,

minute, every
1954 fiscal year.
collections by
the 48
every

during the

Just

tax

.states

roughly $21,000

There is at least

aspect
that

of

for

every

favorable
figures, namely

these

the

most

of money

■sums

the

private

and

one

part

such

vast

though taken from

corporate)

tion
most

For

(individual

part and sustain

welfare.

our

instance, the property taxes

collected
are

economy

remain in circula¬
the United States for the

in

local governments
to pay the mayor, police¬
by

used

school teachers, and to buy
supplies for the municipality.
These local public
men,

themselves

.spending

employees
and in

taxes,

pay

the

for

wages

balance

their

of

shelter, food,

into

which

part

Federal

a

diminish

tax

big

of

revenues

tax

can

current

bill

state

does

be

con¬

not

the total flow of
money,

purchasing

power,

in

this

country.
But

there

at

least

another

spending of

billions

of

dollars

passes

from the private citizen and busi¬
ness firm to
government officials.




taxes

can

state

tax

be

collections

relatively

which

uninfluenced

expenditures.

In

1941

the

situation.

laboring

is

taxes

(6

For

persons

nor

not

is

result

with

man

children

a

total

found

their

(taxes,

revenues

$3,228

$538

x

per

.

.

^

01?lr Federal government is well
" ?as. .ad administrative
afu d^lclts each year since

J931 with three exceptions: 1947,

such

in

of great

man
a

^46, and 1951. Nor are local governments as a group better off. A

out

wnrinnt)
product)

national

h3V

°/

fTrJJf
living. (The

m^dfHn.fS.Petmg-UnitK
before taxes
about

and

is

lgh

Fnrv
.

especially

nnr ♦hT.nhS

i

y'

ea

net

on

,,.

,f

h

incomes,

s

or

allow
popu¬

..

people.

of

State

Tax

from

tamed

Table

I

comparisons

made.

In

this

case

in

how

the

1944

vear

l Once

the

and for

deficit
the

of

out

were

increase

na£ra, fesult

and

for the

of

establishing

last

taxes.

new

course, to

corporate

Federa,

inter.state

or

vear

jn about gQ%

Us

q£

r0m-

tax

reverue

State sovereignty remains a touchy

profits

subject

leading

buiion

higher prices, and how much,

in

contrast,

to

governmental

an

expansion

in

1950,

had

1949

though

1938,
s-mewhat

profits

Ire,

of

have

to

1945,

and

below

*he

say

tO

inter-

SOme

over tax preserves
nothing of the common re-

sistence

JS3S

been

'

billion.

services?

Even

many other slates, the residents of
state A may be receiving more

The

rise

of

Commodity

general

of

further

to

quite
ments

rather

taking

care

wages from

prices

TABLE

the

local governments are

as

important in the fivefold in¬

crease

in

Remove

the

the

adjusted

per

capita

per

tax bill.

price factor and
capita

the

become

$294 for 1954 compared with $113
for

1941.

In

bling of the
by

the

the

the

main,

1941

sum

this dou¬
has

come

armament

expenditures

Federal

group-aid

Motor

programs

for

state

Indiv.

where national defense outlays are

COLLECTIONS

and

1941

$2,536

$2,433

$721

$575

4.2

2°.9

2,0'9

085

913

10.1
—0.6

20 1
4.2

—T.t

9.9
16 0

267

21fi

469

160

106

1.012

394

434

1,776

1,779

4G3

tax

REFERENCE:
Bureau

(31,33)

762

4°2

365

4.0

3.4

222

247
112

268

247

118

11.2

2.2

286

71

53

8 9

2 8

1,577

1,502

646

501

5.0

14.3

.

in

[

"State

of

the

Census,

tax

source

fiscal

1954;
The

31

,

collections.

each

incomes.

,

312

income

(47)

sources

state

1954

380

gift

Other

after

state

are

of

services
If the

poor

protests

-

total

bill

tax

is

low, then the citizens probably
receiving services inadequate
m
au^ntitv
and
ouality, unless
they are blessed with a cost-con¬
scious, efficient group of public
are

servants.

For

;

comparative purposes" only

a;few states

be

can

listed

in

this

article, and I have chosen the five
with

the

highest and
capita tax collections.

lowest

Collections

Per

per

Capita

Delaware

$117
108

Washington

_Louisiana

102

_

California

102

New Mexico

100

Five lowest states—

.'Mississippi
,

$54

Alabama

51

47

-

•Last
the

topped

Washington

year

list

followed

47
39

.

.

lower per

New

by ."Louisiana,

capita state tax collec¬

Tax

Washington,

states

Social

the

taxed

1954"

August

28,

number of

are

.

—0.2

4.9

100.0

(similar

sources

for

prior

years),

1954.
The figures in parentheses
using this particular tax base

states

net

incomes,

not included

33

taxed

in this table.

corporation

net

and

Missouri.

total tax

collections in fiscal

than

in

1953,

with

fains

ware

showed

64%,
gains

the

for

individual
and

declines

for

minor,

death

the

Idaho

Dela¬

unusual increase,

an

accounted
in

10%.

1954

them

of

bulk

than

less

revenue

six

with

by marked
income
tax
The

duties.

states

the

were

largest

drop, 3%.

—

*

There
the

are

preliminary
obtained
wait

details in
report on state

many more

tax collections in

1954 which

from

Census,

the

definitive

for

may

or

one

Com¬

pendium of State Government Fi¬
nances

in

1954

fuU

revenue,

debt

figures

group

which will contain

and

expenditure,
for

the

states

as

a

and individually.
What

of

the

Future?

To

quite an extent an answer
to this question about the future
involves crystal ball gazing. How¬
ever,

let

me

offer two forecasts:

First, total tax
tinue

and
rate

revenue

increase

to

even

will

con¬

with

ad¬

population growth
price changes.
Second, the
of growth will be greatest on

justments
in

individual

Security taxes

,

$10,552 $4,065 $3,606

$11,072

Collections

indicate

Hampshire,

Forty-two states reported higher

4 2

8.0

465

464

1,094

(48)

licenses (48)

(25)

tax

1954

1944

(41)
oper.

net

corp.

Severance

Total

%
D'*Mb.

1953

(45)

and

1953«o

1954

,

receipts (32)

gross

beverage sales

and

% Change

—(Amounts in Millions)—

2,223

and

products

Property

of

governments

SOURCE

(48)

vehicle

Death

and

Washington must not be ignored.
Even

fuels

Alcoholic

Government,

though the cost of subsidies
other

General sales

Motor

the

taxpayers'

in order.

can

TAX
TAX

(And No. of States Using Tax in 1954)

Tobacco

sums

I

State Tax Collections, by Major Sources: 1954. 1953, 1944, and 1?41

and

1941 to 1954 has been

than

of certain basic func¬
tions. If, however, per capita state
and local taxes are high with total

"encroach-

ments" by the Federal authorities,
As far

Prices
is that

answer

commodity

inadequate services because
possibly the local govern¬

mean

be

Rise

though per capita taxes
be higher in state A than in

may

this matter of

on

?r«d (""$977° million in'issd t"P$22.8 state arguments

to

taxation.

state

double California, New Mexico, and Ne¬
vada.
New Jersey again had the

for funds shows no inclination to
wlthdraw from the income tax and
excise field? whieh Aether bring

per

be traced

this

on

offered, but warnings must
be posted about statistics on inter¬

fj_

such

F2d<^2l governmen?Sha°rd preyed
*eddraJ-8° ® nment, nara pressed

1931-1933

years

way,

*

1941

can

other

of

Kentucky
.New Jersey ___)

capita total tax bill from $113 in
to $538 in 1954

information

gen-

intergovernrnental tax allocations,

warjear 1944, and tor last year,

the

residents

Some

.Nebraska

is

also

of

with

will be

r

account

mission working

Revenue

A good idea of the major sources
of state tax revenue can be ob-

war

com¬

as

Witi*mental unit are difficult if not tions, and the next four higher
J.
, necessary
and jmp0ssible ,0 find. There usually states were Nebraska, Kentucky,
burden of a free

pre-

of

bill

be

to

person

a

tax

pared

to bring an

necessary

This has led, of

which

number

Comparisons
for

states.

-ti

rates

for the elobal

a

is natural

interested in his

on each
level of government to find more
revenue
through increasing tax

(the last

over

Inter-State
Tt

responsible public officials

i

5°
"
bearable
Sources

tax

governments certainly sug¬
that local fiscal autonomy

gests

billion;

yn2L nf"LwP?and mu,tiPla taxation because tax
T In
d bases untouched bv any govern-

thi

Zi i

be, the ulti¬
states for

of

will continue to shrink.

nancjai pressures has been to forre

™haVan Tmy

™

,

wer|

m

'xhe

a1™8'

whh

responsibility

local

took in

expenditures of $5.7

4fn

inclined to ask myself

am

$18.6.

(1950 census)

almost Glanced

gives data for 1941

are

mate

the economic welfare of their own

from state and Federal sources
charges and miscellaneous

f

World War II vear)

much

the finer points may

super¬

Whatever

degree.

some

Tax

are

'

.

I

y

to

highest states—

plus

$3 500.)

Busmess taxes have been

come

though it carries state

even

1954

real

•

easy way out of local fi¬
strains,—namely, state aid

an

nancial

Five

eral

•

r

of

*3-8 billion in taxes, but had

lation, but do not eliminate the
influence of price variations, an
important consideration when
years

fers

The

inhabitants

.

i

expenditures

eral

lhrjLZ:atfaCt,0ry ansrrn°
thi
q
stio
An 1 creasing pro^ S do
^
comfort standard of

This dependency of local

481 CitieS havinS m0re than 25,000

^

hoavvT
heavy,

inn
too

,

$10;2 bttlion'against direct gen-

■

tax bill

changes in

squeeze

for the factor of

<

,

j/ocw

nafinnal

npf
net

a

per¬

only $538.
Per capita measurements of

collections

be used.

are

.es.e, *narcia! ,woeLare..n?i*
restricted to the states. The plight

state taxes-

half.

a

a

instance,

paying

single

a

with

wife and four

wealth confronted with
of

decade and

respective

governments upon state action of¬

,

are

by

states

„.

by reference to

seen

their

although some local
units have been given leeway in
tax
matters, for the most part
state legislatures tell
county and
municipal officials what taxes may

laneous income) inadequate for
°V
governmental
ys/ XAS a r5su
Estate debt total continues to quality, then

of NNP.

Security levies.) Again the weight
Federal outlays for armaments
kinds

23

federal aid, charges and miscel-

(Federal,

12.8%

were

and

respective

of

per

comparing

from
is

aspect which must be kept in mind.
The control over the
these

in

known

very

circulation

Thus, under

ditions,

again

goes

*'

similar

traced.

i.e.,

in

taxes.

A

and

Or

family. Whatever statistical
device is used, care must be taken

clothing,

medical care, and recreation
pro¬
vide local businessmen with in¬
come

the tax-paving popula¬
capita figures could
be multiplied
by 3 or 4 or 5 to
get an estimate of taxes paid by
up

tion.

son);

were

<K) seconds.

total

taxes,

-

there

Add the figures for each of the
three levels of government and

the

in

period, total levies of were 3.1% of NNP; in 1954, 3.4%.
all governments increased fivefold Thus the "burden" of state levies recent report of Census gives an
weighted heavily by the great on their} residents has remained! f.
^a
a^.u° fcJ"10.n tota\
jumps in the Federal budgets. Not about jthe same during the '. past ■.l11s5a uln
.
a!esj. year)

Korean

too

not a smgje state covered iis
general
exnenditures
with
just

NNP

income

14-year

a

and

is

1941

state, local)

these

on

for

allow

World

sum

national

and peacetime subsidies of various

$27 for 1941.

tToubled

total—if "grand" is

investment."

from

(These calculations exclude Social

the

years,

there

1941

by

figure

for

figures

services

For just state tax col¬

II

the

$70

foreign'

In

about

was

and

During World War II they rose to
25%, and currently are about 26%>

War

$113.

are

1954

goods

of

And

available) the 48 states as a group and better services in the form of
had general expenditures of $14.7 roads, education,
safety, welfare,
a^'^st t^xes of only $10.6 etc.
On
the other hand a
low
billion. Even on a state-by-state state tax load does not necessarily

including indirect business taxes,
plus and minus a few minor items,

all-governmental

our

for fiscal

but

from

net

per

a

In 1941, the last of the

$538.
was

On

avoiding

and governments, net
domestic investment, and

differs

per capita calculations
also facilitate intergovern¬

which

of

private

using

by

of

year

is

(NNP)

consumers

population.
This
can be removed

our

types,

1944.

chases

the

to

copulation factor

ices

each

the

double
counting.
Or it can be
thought of as comprising "the pur-

Growth

Population

break of the World War in the fall
Of 1941. Federal tax revenue about

through fiscal

product

(or shorter time period)

matter.

Part of the increase in the dollar
tax

states.

a

goods and services produced in
the United-States within a year

of

wisdom

another

is

are

out¬

national

same

a

earnings

our

The

spent.

decisions

only

only double that at the

was

Net

taxes

my

the

market value of the net output of

about

growth

change.

Wyckoff

about high taxes and forget
parallel change in income.

with

remains

burden

prefer to make our own de¬

port will show

J.

of
of

few billion dollars. One must
conclude, therefore, that state tax
levies
have
become
relatively
somewhat more burdensome during fiscal 1954.
This is rather disturbing because even with heavier taxation
many states are unable to balance
their over-all budgets. In fiscal
1953 (the latest year for which
full financial data on states are

portionately

of

shall

creatures

are

net national product even declined

If my income changes pro-

taxes.

pretty good point of reference
for this purpose. NNP is the dollar

nary figure,
the
final
re¬

V.

the

those

pay

philosophies beyond the
Probably the
spontaneous answer is that most

such

from

dollar-

to

of this article.

us

that

wise, though probably I shall talk

used

scope

cisions

shows

to

by comparing taxes

income

with

what is

so

made

be

can

political

cal

ap-

involves details
an
examination

question
analysis and

billion for fis¬

be

answer

The

difference?

states at a new

"1

burdens

tax

concerned, they in law and in fact

vision

businesses.
Table I also

ous

Accurately and in every
aspect, No. But one measurement

than at the local level.

this

tions by

Can

burden.

admissions, motor fuels, and vari-

usu-

to mind:

comes

tobacco products,

sales,

1953 to 1954 the absolute dollar
increase in state tax collections
was 4.9%. This increase was more
than population growth. During
the same 12 months prices remained virtually unchanged, and

public (the taxpayers),

collec¬

tax

mentioned

are

retail

0n

praised?

-

It may be argued that such offi¬
cials are
representatives of the
the

cities in Pennsylvania, Ohio and
California, and local officials in
many states are trying out taxes

to

Burden

ally another word

will continue to increase, but Federal level

revenue

quali-

governments

Tax

When taxes

part

of taxation will grow at greater pace

»

possibly

and

state

by

;

of rising tax collections to population
increase, and expansion of governmental services. Gives figures
of state tax revenue and amount paid per capita, and predicts
Ascribes

Government, and some
have been tapped by local governments.
Income taxes are being
levied to an increasing extent by

to

their taxpayers.

states and

t

part

tative increases in the services of-

Wyckoff, in his review of state tax collections
that in addition to the $63% billion collected in taxes

Professor

■

substantial

in

ascribed

Economics, DePauw University

Federal

This 40% increase must be

4,954.

By V. J. WYCKOFF
Professor of

I

Thursday, November 25,1954

.

(2150);

t%

for

Continued

on

page

38

Volume 180

Number 5380

The Commercial and Financial Chronicle

.

tent

the

1954

Annual

Report of the Bank of the Manhattan
to shareholders, Chairman J. Stewart Baker pointed
though t~e past year has been marked by a period of
mild recession in economic
activity, accompanied by a slackening
in the demand for bank credit and
by a re¬
duction of interest
rates, conditions during
the period furnished a demonstration of the
Company
that

out

inherent

strengt i of
structure.

banking
"For
months

perio l

the

of

nation

our

as

business

and

structures

being reduced

ore

a

small

contraction

in

that

J.

Stewart

Baker

in

makes

throughout
exploration

Manitoba

Territories

accompanied bv

a

stimulating

in other cities, thus further reducing the discrimination under
which New York City and Chicago banks have labored for some
time. Actions such as these provide reason for hope that mone¬

now

high
enor¬

tonnage already taken from

mines, INCO's proven
stand

now

have

ore

the

at

operated
the

At

re¬

highest

long

as

of

end

1953,

as

the

reported 261,541,000 tons

with

ore,

1953,
of

tary and fiscal policies will continue to be vital, stabilizing factors
in our economy and that the Government will guide its actions
so
as
to provide an environment favorable to the great growth

V

Continued from page 2

nickel-copper

con¬

tons. of

proven

ore

con¬

total

a

ore

187 million

tons

favorable

position has'

ore

accomplished by continuous

exploration

its known deposits
and other parts of the Sudbury,
Ontario, basin where its five large
mines are located. These are the!
on

important

an

discovery

Brunswick,

This

is said

base

metal

tion

already

stacks

up

grade

is

this

be

as

tonnage

of

,

the

has

of

for

for

sive

and

more

in any

be

Net

in

from

reserves

in

in

1949

to

$3.55

1953.

first

nine

months

have

mad'?,

been

operation.

At the end ct

$197,000,000, compared to $261,000,000 after write-offs of $63,500,000 in 1939.
During this pe¬
riod, no increase has been mad*
in the number of shares outstand¬

>

the

For

th*

at

000,000 at the end of 1939.; Totvl
assets stood at $430,000,000 at the
end of
1953 after write-offs of

share

per

stands

1953, working capital stood at
$190,705,165, compared with $66,-

369,902.
Net, after reserves and
taxes, was up from $32,252,314 to
$53,694,526,
or
from
$2.08
per
share

¬

the company in the giganti?

ground

in¬

taxes

earn

-task of converting to full under-

from $60,609,692 to $117,-

and

capital

that

demands

1953, and operating profit

creased

the

to

$3.00 t«>

a

highest point in the company'#
history, notwithstanding the large-

1949 to $338,579,-

before

dividends

Certainly

annually.

upon

increased

surface
has beert

anticipated, with current

Working

in Canada.

have

sales

$182,806,542 in

increased

share

$6,084,742, compared
with $4,967,450 in
1952, said to
be
the
largest expenditure for
exploration in any year by any
company

from

ings running well above $4.00 per

more

cost

mining

major portion of

operation

$3.25 basis including extras might

exten¬

widespread than
previous year. Prospecting

efforts

the

stockholders.

year.

both

was

S.

less capital expenditures,
should be required over the next
few years,
and it is reasonable
to assume that the major percent¬
age of earnings may be released

In 1953, the company's explora¬

tion work

U.

made,

the New York

on

Exchange this

This

tax.

against

taxes, payable by

swing-over

underground

sensational advance
of American Metals

price

Company shares
Stock

accounted

that

Now

the

metal

reflection

the

the American holder.

informa¬

base

A

paid in
15%.

are

withholding

deductible

Federal income

the find
the highest

of

one

Canada.

in

the

From

dividend

extra

States funds less

is

tax

cents

Dividends

5.25%.

Canadian

big and rich

a

90

on

United

copper-

made in

obtained,

discovery

part
in

to

was

Canada, by the

find.

big

finds

995

mined.

was

The

been

of

Frood-Stobie, Creighton, Garson,
Levack, and Murray, and also the
Frood open pit.
In 1953, ore re¬
sources were increased by 18,852,000 tons; 5,185,000 tons more than

The Security I Like Best

based

Canada.

in

the^
pay-]

Dec.

present

and

American Metals Company. INCO
has a 25% interest in this project.

ore

6,927,000 tons of nickelcopper.
Over the past 25 years,
the
company
has supplied the
world
with
nearly five billion
pounds of nickel, over five bil¬
lion pounds of copper, and over
five million ounces of the plati-,
num
metals.
From 1929 through

authorities, in realigning
requirements to lower levels, provided for
greater reduction for Central Reserve City Banks than for banks

.

Extensive
done

Northwest

taining

The Federal Reserve

country."

been

New

620,000

reserve

our

20, 1954. The yield at
price of 55 U. S. Funds

the world.
has

to yield

7,817,000 tons. 'Compared
with Dec. 31, 1929, figures of 202,-

Treasury authorities for having administered their affairs with
T.iere was a much needed contraction

potentials of

dividend

company

tent of

outstanding statesmanship.
reduction in taxes.

quarterly

able

and

hitherto considered uneconomical.

of

over¬

Much credit is due to the Federal Reserve and United States

member bank

along with

regular

Canada

lead-zinc

that

activity, only a modest increase
in
business
fc jlures
and only a moderate
increase in unemployment," Mr. Baker stated.

in Government outlays which was

de¬

the company's history—
a very fortunate position, and one
that is seldom enjoyed by min$s

economic

'

iron

extra for payment

where in

Recently,

INCO.

a

grade
process

point in

during the restrictions of
being exhausted, the nation ex¬

only

high
new

15

Basin, INCO is actively aggressive
in
geological
exploration
else¬

possible

company

perienced

the

which
about 1,-

the treatment of lower grade ores

mand, accumulated

all

of
A

is

operation
recover

veloped by the
this iron

This

ores.

an

tons

wartime,

were

in

year.

serves

expenditures were
the huge backlogs of de¬

and

000,000

its

inherent strengtn

banking

nickel

ultimately

..

time when government

a

will

mous

a

tribute to the

a

unit

Notwithstanding the new
levels of production and the

the.

and

whole, the past 12
have
been an historically important
marked by many difficult transitions.

It is indeed

at

business

botn

in

first

Past Year Period of Successful Transitions
In

(2151)

of

1954,

sales were $262,655,664
against $254,950,475 in the same
period in 1952. Costs were about

ing, nor has any funded debt bee#
created; yet, the average selling

and taxes were $2,686,- price of the common stock wa*
51 Vz in 1939, compared to current
lower, which resulted in net
levels of 55.. In 1937, the share#
the underground mines, and the, earnings of $47,430,561, compared
nickel-plating
that
bonds
so
sold at a high of 73.
to $41,252,680 in the 1952 period.
.total :underground
development!
Strongly
with
aluminum
alloys
Considering the tremendous or*
These net earnings were equal to
such as
applied to jet aircraft that the composite materials may amounts to more than 352 miles.
Smelters and refineries are at! $3.15 per share for the period as reserves, the present and futui?
be drawn and later finished with
engines.against $2.72 per share in the nine demand for nickel, and the poten¬
VAlso, a promising new field for. chromium' plate.
New
markets Copper Cliff, Ontario; Port Col-,
tial
of
world-wide \ exploration
months of 1952.
and
Clydach,
the use of nickel appears in the are
expected in the' plating oF borne, i Ontario;
Dividends are being paid quar¬ we feel that International Nickel
expanding
electronics
in. ustw, aluminum appliances rand furni¬ Wales. A precious metals refinery
of Canada, Ltd., at current level#
operated
at
Acton, London, terly at the rate of $2.00 per year,
While the quantities of nickel al¬ ture when nickel becomes more is
witn extras in the final quarter of 55 offers better than averag?
England.. A foundry is located at
loys in individual components of freely available.
of each year.
In 1953, 35 cents high grade common stock invest¬
electronic devices are small, pro¬
A good portion of earnings in. Bayonne, N. J., and a rolling mill
extra was paid,
together
with attractive
and recently a ment,
art
Huntington,
W.
Va.
Other
duction of such devices is very recent
years
has been used to
declaration was made of 90 cents growth possibilities.
rblling mills are at Birmingham,
convert
large. In the past year, 7,000,000
operations. from
partFINANCIAL RECORD OF INT'L NICKEL, CO. OF CANADA, LTD.
.
,j,
pounds of nickel were * used in surface,
part-underground. pro-1 England; and Glasgow, Scotland.
in

cobalt-nickel-chrom^ base al¬

loys .which

also

required! in
the manufacture of high temper¬
ature,
high
strength
materials
are

with

program

aluminum

alloy
developed {a

which

producers

were

mined

There

are

14

during

the

year.

operating shafts in

the

same

882

.

this

industry.;,

*

duction

t

INCO expansion has been made

possible by brilliant metallurgical
developments,
and
by the farsighted vision and long-term
planning

the

of

management.

Continuous research
to

counteract

tion

costs

improved

is carried

increasing

on

produc¬

and

to develop new or
products, to widen the

usefulness of nickel.
Research

has

played

a

maior

part over the years. Much money
has been spent and great rewards
have
resulted.
Many new use$
have

been found

ucts;

new

improved

for INCO

prod¬

products and

new

metallurgical

processes

have been developed.

and

to

completely

a

ground operation.
As
yet, the
complete conversion has not taken
place
because
the huge Frood
open
pit is lasting longer than
had been expected. Since the be¬

ginning

of

INCO's

mining expansion
1953.

$170 000.000

underground
to

the

hss

been

sp^nt

$30,000,000.

In September of 1953,
it was announced that $16,000,000
would be spent on a pyrrhotite

which

plant

will

from

values

low-grade

trates, and at the
duce

a

recover

same

nickel

concen¬

time

ore,

representing

that

a

a

been

made of

the

commercial

the high

use

iron

Years Ended Dec. .31—

The

first
has
con-

All

told

INCO

employees, 70% of whom are in
Canada, and
whose wages are
among the highest in all Canadian
industry.

' '

Nickel-

is

known and

All

Not

a

of this stock has been sold.

New Issue

*

other

used.

major

in. 31

all

cities.

►

com¬

These

independent

14,500 Shares

for

taxes

and

Deprec.
Net

depletion

profit

Earned
Fa d

share-

per

per

WOiking

share
capital

range

Pr.ce range

—-

dis¬
com¬

Inc. (which is a subsidiary
company); give warehouse service
in the various geographical areas

pany,

They are
distributors,
selling not only INCO products
but also other metals and metal

Machine Co., Inc.
$32 per share

oxide

November 19, 1954

vJ

out

nickel,

as

electrolytic
cathcdes, nickel - copper - chro¬
mium-iron
pigs,
nickel-copper
shot and
ingots; nickel-chro(sinter)




selenium, and tel¬
platinum; palladium,
iridium, rhodium, and ruthenium.
In
addition
to
the
Sudbury
gold,

silver,

62,875,571

48,765,849

32,252,31 V

$3.91

$4.18

5

$3.21

8,195,0."T
;

'•■■■

$2.0*

i

$2.60

46 >/4-33 '/a

$2.60

$2.00

$2X0

178,005,866
48%-40'/8

165,948,466
42%-35'/2

150,329,694

137,413,83$
36

39%-29&

-29

54>/4-34%

com.,

14,584,025 shares of no par valua.

299,500 Shares

ARKANSAS NATURAL RESOURCES
CORPORATION
COMMON STOCK
f'

ized for .the purpose

Corporation was organr

of exploring for magnetite iron

titanium, mica and other

ore,
T-

i

,

Arkansas Natural Resources

minerals.
...

.

»

Corporation owns leases on more than 13,50Q
acres
located on the-Magnetic Anomaly tat Rispnj

The

Arkansas.

!

,

OFFERING PRICE
#

*

$1.00

per

Share

r

»

Copies of the Offering Circular may

be obtained from

EATON & COMPANY
Incorporated

32

BROADWAY, N. Y. 4, N. Y.

WHITEHALL 3-1492

and

pigs; and as pellets
and powder.
Copper as electro¬
lytic cathodes, wire bars, cakes,
billets, and ingots.
Cobalt as
oxides
and
salts.
Iron powder,
lurium;

58,891,282

Underwriter

mium-iron

Dean Witter & Co.

53,694,526
$3.55
$2.35
130,705,165

ISSUE

six distributors.

Refineries .turn

Price

27,597,615
8,963,574

17,975,01V

10,461,433

9,080,607

—.—

Limited, is owned by INCO, and
also
in
Latin
America,
where
are

86,980,227

48,148,718

metal

Calculating

there

-

1954 to date:

NFW

60,609,691

124,939,069

115,039,253
43,945,837

Capitalization: P.d., $27,627,825 of $100 par value;

specialties. A similar distributing
system is in effect in Canada,
where i» one, ;; Alloy
Metal Sales,

Friden

i

116,972,548
43,598,993

12,854,560

profit

ware¬

panies- with' the exception of
Whitehead Metal Products Com¬

essentially

operating

in the
nickel
INCO
direct

in iyhich they operate.
'

sales

Net

Reserve

1151
,
1950
1949
$286,785,241 $228,071,346 $182,806,41 !f

1952

1953

,

$338,579,995 $314,228,747

Net

Frice

with

part of the
pany's nickel output is sold
United
States.
Primary
and mill products made of
nickel alloys are sold both
and
through distributing
-

tributors,

of record only.

:

alloyed

metals, principally copper, alu¬
minum, and iron, where hardness,
toughness,
corrosion - resistance,
and many other improved prop¬
erties
are
required.- The great
corrosion-resisting alloy series of
stainless
steels
are
universally

houses

This advertisement appears as a matter

smelter is the
the world.
has
over
27,500

Cliff

Copper

largest of its kind in

The

pro¬

by-product of high grade

iron

de¬

new

of

capital expenditures, and the
1954
expenditures
will
exceed

time

A

end

in

velopment

recently completed is
10-year cooperative researcn

under-'

Please send
mon

me

Offering Circular relating to

6tock of Arkansas Natural Resources

299,500 shares of com-

Corporation.

NAME

ADDRESS

...

CITY
FC-25

TELEPHONE.

16

The Commercial and Financial Chronicle

(2152)

New

sphere by goodwill and integrity,
and by facing the stubborn facts

Opportunities for a Liberal
Foreign Trade Policy

of

difficult

a

make
to

it

view

our

adopt

we

ahead in foreign trade,

move

which might be placed on some localities

sures

tions

in

and other impediments to interna¬
Points out improvement in economic condi¬
progress made in
convertibility and greater private American

currency

investment abroad.
ment

can

the twin

I

that

role

my

of

the

Council

as

tinged

we

may

try

to

be

approach

to

problems

finance. And the temptation
always present to tell the other
fellow—or the "foreigner"—what
is

to

ideas

eral

your

as

from

officers

AllanSproul

venience

and, perhaps, for your
enlightenment. If I am to make
amends for the fraudulent

quality
of my role, it will have to be
by
honesty in speech.

vention, I could do
If

we

effectively

address

to

proposition

that

world

depends

tional

good-will

we

must

in

our

and

problems and those of

our

our

own

trading

partners throughout the
Communist world.
This

is

not

of

pressures

always

personal

Europe
to

amelioration

Trade
1954*

address

non-

of

the

of

their way
com¬

been; made
reverse

own

by

the

than

more

a

century,
is widening and

nation

These historic
developments

should

group
the

put

attack

National

Foreign
Council, New York City, Nov. 15,

on

a

new

charge

and

courage
the economic

which beset
been

nomic
I

the

broke out into uncharted ter¬ mention

ritory

im¬

which

obstacles

down

in

progress

if

seem

to

United

most

of

have

There

States,' the

dom

and

will

be

the

to

United

King¬

Western Europe.

chore

world.

our

achieved

in

of

into

en¬

our

problems
What has

the

political

Sew Issue

*

feat.

In

fanfare

being

treatment at the
trade

and

largely by a
couple of issues, notably Du-

Our Basic

ear¬

nature to bolster them.

'

Foreign Trade

have

been

of

foreign economic
the end of World

the

basic

ob¬

our

since

War II?

First

selves

the relief of individuals

and

to

for

outlet

an

—

addressed

we

humanitarian
embarked

our¬

instincts.

on, a

Then

half

gaps of more
dozen points for

a

Chrysler, American Can,
Standard
Union

Oil

of

Carbide

California,
Allied

and

*

*

matter of
an

which, in

minutes, had

new

lows list with

was

about

as

a

as¬

the
price that

appearance

on

poor as any re¬

This issue is another

*

Contrasts With

iye

a

sured

omis¬

followed

deterioration

sion of its dividend

corded in the last three years.

Chemical.

lustration

1929

the

of

good il¬

divergent

market of the last few years.

Contrasts with the

of eco¬

program

points

ranging to

away

sound

our

several

were

of people stricken by

groups

war

previous

than

blue

matter of

a

peaks

Objectives

policy

As

centers of

nerve

finance.

aid'

nomic

help

national

to

restore

units

period in
previous all-

to

productive

a

necessary

of

ace

hostile

parently

to the

response

totalitarian

a

force

loose in the world.

ticipated in

men¬

advancing

ap¬

somewhat

and

which

attempt to set up
international trade organiza¬

an

an

evidence

an

good

of

awareness

international economic

relations rest, at bottom, on good
trade relations.
By trying to do
too
much, by trying to cover

with

set

one

over

stability

agreement,

by

declined.
market

too,

It

this

attempt

off,

AMERICANA,

INC.X^k

(A Florida Corporation)

'

Vj

as

eral

Agreement

the

of

seed

and

per

to its credit.

1 matters

As you know,

now

this

It

is to be hoped

meeting will have

structive

share

trade

on

meeting of GATT
being held at Geneva,Switzerland, with United States
is

that

$10.00

may bear
international

greater

representation.

($10 par)

and

important

an

CUMULATIVE & CONVERTIBLE

Gen¬

which already has some suc¬

cesses

7% PREFERRED SERIES A

the

Tariffs

Trade, however, which
collaboration

22,000 Shaw

on

courted

It did throw

by-product,

a

results

which

will

was

from

For

the

aircrafts,

nothing

or dividend action
historic

a

another

because the

angle,

1271

issues

that traded in the second
sion

of

the

broadest

the

week

ses¬

market

ever

con¬
rec¬

*

sharp

retreats

have

been

ment

at

Another

indication

of

the

was

1930, but

highest

below the 1929

pinnacle while

are

even

news

Ap¬

senti¬

overly convinced
prosperity for

least the airframe makers

durable.
*

*

*

Textiles and

than 50 points

utilities

rule.

investment

isn't

is very

since

more

the

a

the

selectivity is the fact that the
rail average reached a level
that

good
to be

the

on

the

that the present

*

seems

selling signal and somewhat

comprised parently

recorded.
*

❖

*

a

lead

of

international

and achieved failure.

holding

100-odd

those that did

•

mestic

issues
slim

is

We also par¬

rules, and by trying to harmonize
international equilibrium and do¬

Price

the

attempt to

an

the talk the market down since
there was little of a factual

fact,

done

was

marks of

all

had

tervention

little

Apart from the handful of
chips that have been
fact, only five
a
presentation. It will represent,
of the 30 components of the carrying the industrial aver¬
merely, a personal belief that the
age, issues in the list that
fundamental problems of inter¬ Dow industrial average made
stood out were largely those
national
trade
and finance,
af¬ the new highs list for 1954
tied in with dividend action.
fecting all of the free nations, when the
break-through oc¬
will
respond
most
quickly
to
Houdaille-Hershey's rapid
curred. For some the
Asia and the Middle East in such

development

AEROVIAS SUD

consternation

the

among

no

countries in all stages of economic

.

lively

a

There
Pont and Standard Oil of New
disparagement of the
importance of our neighbors in Jersey, with gains of past four
the American
continent, nor of and three points, respectively.

that

»•*»

t

up

*

was

the

over

remarks

my

reference

set

*

eco¬

hope I shall not be misunder¬

stood

that

the rather large group
debate over where, and when, pL short sellers who thought
the advance will end. There is long ago that the market was
little agreement on that, how¬
high enough.
Some of the
ever.
many rumors of outside in¬

need

international
objectives.

tion—

J?

be

might

century ago on Sept. 3, tracted to the scene because
1929, the industrial average of the boiling markets. Not to

critically,

of

our

most

solution,

which

and

achieving

com¬

Age-old

on

because the mar¬

enthusiasm

industrial ket's

•f-

The

easy.

and

by Mr. Sproul before

Convention

or

have

Britain

thusiasm
♦An
41st

a

continent

to be

appear

mitments

step.

the

on

the

ter

pro¬

adjustments, the

slowed

jectives

foward

should

we

awareness

pediments
have

What

great

decisions.

examine

to

with

Europe and the North At¬
Community converted into

ern

our

integrity,"

of

what

or

all

when

It
sold roughly double the
1929t?when the
capacity
best of this year back in 1946,
broadening its role of partner in and trading relationships de¬ time^ high was set are vivid.
world affairs in a way that must stroyed or distorted
by war—an The cats and dogs and the a year after recapitalization.
help to bury whatever latent iso¬ act of enlightened self-interest.
secondary issues all swept There was no bull market for
lationism still exists, and Russian More
recently the emphasis has forward
then, while the pres¬ it even before the dour divi¬
attempts to promote division and been on„ military aid to our
ent
peak was made on an
suspicion among the Western friends
abroad,
with
whatever
dend action.
powers have been checked.
economic benefits might accrue— ultra-selective basis with the

of

be temperate but honest
assessment

of

affairs,

mutual

plans and hopes for West¬

our

policies of

interna¬

on

various

though the
sharp, we have

breakdown

Great

our¬

"expansion

plete
of

the

approve

what appeared to be

seen

of-

assuming

even

be

may

space

and

that

will

done,

enmities

general

the

debates

a

less in any

no

to

are

trade

must

been

brief

a

lantic

Given tne tneme of tMs
FortyFirst Annual Foreign Trade Con¬
case.

hoping

we

has

who have made all of the prepa¬
rations for your comfort and con¬

selves

In

and

parliaments

directors

and

weeks.

time,

welcome

comes

our

hope, therefore, that you have
inspired, as I have been,
by the truly tremendous develop¬
ments in the international politi¬
cal sphere during the past sev¬

meet¬

your

to

reason¬

I

to this

real

conform

just and

all been

city and to
these

to

do

of what is

able.

me.

welcome

ings, but

should

he

value

except

in

and

but

little

objective

complicated
international
trade

of

financial

and

saying that, in the face of
giant stride forward in. our

urgency
and

the

is

a

ceed with better heart and greater

the views

warp

our

my name is of

you

am

political

matter how hard

no

Com-

I have

mittee,

us,

of

to

Trade

Foreign

with

fraud.

tend

of all

are

lent my name
to
the
Com¬

I

some

interests

all
Chairman

you

National Convention

mittee

I

and should do to promote

sure

that

of the

mercial

things our govern¬
foreign investment, and
goals of currency convertibility and non-discrimina¬
tory trade relations are still attainable.
are

States, nor

for

this

for

am

aware

Holds there

week

The stock market made his¬ erated much caution in Wall

convertibility by the average
punched decisively creating excesses that would
United Kingdom, nor a dash by
through the high water mark lead to a correction and be¬
any
country or group of coun¬
on
record.
In toppling the cause of fears that govern¬
tries
from
the practical
away
problems and real risks of com¬ fabled 381.17 mark set a quar¬ ment controls might be at¬

foreign countries and the

many

attaining

STREETE

tory, at least statistically, this Street both

dash

attacks trade restrictions
commerce.

By WALLACE

tortoise is taken

trade by the United

tries, the President cf the New York Federal Reserve Bank
tional

the

right out of Aesop as the emblem
I am neither propos¬
ing nor predicting a dash for free

indus¬

or some

and

of progress.

must

we

is

daring,

liberal trade policy, despite the economic pres¬

more

a

to

are

THE MARKET... AND YOU

perspective that
always preferred to

narrow

caution

President, Federal Reserve Bank of New York

situation, should
possible to continue
economic problems

less

with such

By ALLAN SPROUL*

Asserting, if

Thursday, November 25,1954

...

Cements in

Limelight
*

The

long-depressed textile

more

section

shared

a

of. r the

bit

laggard and failed by almost a
dollar to even post a.new high limelight this week, notably
Lowenstein where good divi¬
for this year.
;rV,
*

*

*

-

dend action and

-

Failure to Talk Market Down rather
To

achieve

the

break¬

a

split

were

widely anticipated well

in advance of the event.

The

ommend themselves to the United

States,
Copits of this prospectus

may

be obtained from

■

33

*

Hough,Inc.

Member Midwest Stock
St.

Petersburg, Flo.

Phone 7-8166

lateral
too

Thl» advcrtiMmcnt it
itoilhor
Th#

on

off«r to toll

nor

a

lolicitation

offering is mado only by tho Pro»poctu»




to

boy

any

of tfcaso ihorot.

to rotidonh of Florida.

the

other

tries improve their economic con¬
and

ognition

F°wrth St. No.

to

throughout these
postwar years there has been rec¬
ognition of the need to help the
so-called
underdeveloped
coun¬
dition

Exchange

as

almost

And

Bell St

well

as

participants.

of

performance — a rec¬
the fact that multi¬

trade

largely

cialization

concepts which rest

on

a

which

species of
tends

to

spe¬

freeze

existing differences of skills and

Continued

on

page

consequently,
posted
through, the industrial figure issue,
has soared in an almost steady the best
price recorded since
uptrend since September, a 25% stock
split in 1950.
1953 during which it covered
4=
4=
#
more than
125 points.
Since
Cement
issues
have
con¬
the pronounced pickup in in¬
terest and speed by the bull tinued to make
progress with
market
following the Elec¬ Penn-Dixie and Lone Star,
tions, almost 30 points have
making rather persistent ap¬
been added in the short
span

of three

weeks.

In

fact, the

pearances

40 speed of the ascent has gen¬ lists,

on

the

new

occasionally

highs

accom-

Volume 180

Number 5380

...

The Commercial and Financial Chronicle

(2153)

panied by Lehigh Portland. A santo showed a disposition to tion have been considerably
rather large body of invest¬ slip backward
even
in the short of dynamic. For ex¬
ment opinion has veered to midst of all the enthusiasm ample Zenith's occasional
these issues as the ones to be and American Potash, which runups have been
pretty well
favored all next year in view had
of the

a

large demands of the down

whirl

recently, calmed whittled

rather

abruptly. As
industry, and the group, the chemicals are
issues
have
reflected
this much off their year's highs
popularity fully.
any other division.
construction

a
as

as

away

in short order

*

*

*

*

*

*

s

American

ULM, Minn.

Wellin is

now

—

Arne

[The
article
time

views
do

not

coincide

those

with

650

expressed

A.

necessarily

of

those

with State Bond &

2 With

Bache Adds To Staff

W.

Gag

&

associated with

are

now

minal Building.

Davidson Adds

With Crowell, Weedon
(Special

LOS

ANGELES,

Calif.—Harri¬

F. Anderson has become

son

MODESTO,

Calif.—Joseph

con¬

staff

of

Covel

Davidson

&

Lobby.

zmmm

prominent toy¬

more

oil

record.
*

*

*

] Steel shares, chilled

a

bit

the rebound in

as

stalled

operations
week, neverthe¬

this

less continue to

acquit them¬
S. Steel, in
particular, has been able to

selves

well,

forge into

U.

high territory

new

with conviction, but it is one
of

the

failed

that

issues

better

to

has

still

all-time

its

peak of 1929, which is equiva¬
some 20 points away

lent to

the

on

was
•'■

present stock which
split in 1949.
■

■

*

*

A New

Pennsylvania
was a

*

,

Sprinter

*

Sand

Glass

newcomer

to the list of

the sprinters, again a case of
good dividend action well
anticipated in advance. This
issue is

more

in tune with the

story told by the industrial

since it has doubled
since its 2-for-l split
in 1950 and is in historically

average
in price

high ground.
^

Oil issues

were

a

surprise

generally by stepping out
smartly to accompany the
averages
on
their
classic
break-through.
Gains
of sizable proportions were
achieved by the entire divi¬
sion
with
more
unanimity
than any other group, includ¬
ing multi-point jumps by such
staples as Cities Service, Ohio
Oil,
Pure
Oil,
California

and

Standard

Houston

Outside the International
stands this

Oil,

bearing

the latter

indicating advance
knowledge of a plan to spin¬
off various

Even

properties.

Sunray, which has stubbornly
the

resisted

the

upward pull of

market

bull

for

a

dis-

Unlike Atlas, a

appear
roster

awake enough to

ing banks in commercial centers
of the free world, Chase is a

the world into many geographic

focal

Customers' interests in

and

making

join

new
*

Apart
chemical

the

from

*

DuPont,

section

zone are

Allied

has

lacklustre.

Chemical

Zone

officers

the
been

these many sources

keep well-acquainted with the

tion

they keep currently informed
and

areas

and




Both

Mon¬

assigned to them.

Through
of

overseas

branches,

representatives, and

reciprocal relations with lead¬

you

have

a

foreign banking

problem, why don't you talk
to

the people at

supplement

vision of officers and staff who

offices
somewhat

under the super¬

If

Chase?

tion and service for world trade.

the

issues

highs.
*

each

point of banking informa¬

commercial and financial life of

most-active

the

on

his shoulders the burden of the whole world\

large interna¬

couragingly long period, fi¬
came

mythological giant. Atlas,

tional bank like Chase divides

zones.

nally

Building in New York's Rockefeller Center

great statue of the
on

a

position

advice and
customers

ests

to

guidance

to

furnish

Chase

with business inter¬

in their

areas.

THE

of informa¬

by frequent travel. Thus
in

Staff

Chase
NATIONAL
OF THE CITY
HEAD OFFICE

W.

Alexander has been added to the

to The Financial Chronicle)

boiling bull market and has
been far

to

(Special to The Financial Chronicle)

Motors,

ing with its lowest price

C.

McCoy & Willard, 30 Federal St.

refutation of the

a

Lillian

Co., Dixie Ter¬

formerly Nash and Hudson,
has been

Constance

and

Luderer

Ligon has been added to the
of Bache

Chronicle)

—

Coulopoulos

CINCINNATI, Ohio—Geraldine

as

McCoy & Willard
to The Financial

BOSTON, Mass.

(Special to The Financial Chronicle)

the

They are presented
of the author only.]

Street,

Exchange.

Street.

at any

with

Spring

Mortgage Co., 28 North Minnesota

this

in

Crowell, Weedon &

Soutn

members of tne Los Angeles Stock

(Special

to be
With John G. Kinnard Co.
something of a puzzle,
Televisions, too, are a neg¬
(Special to The Financial Chronicle)
Chrysler and General Motors
lected group. Despite the im¬
MINNEAPOLIS, Minn.—Harry
alternating in good strength
C. Ervin, Jr., is now with John G.
as the traders blow hot and pending holiday season, which
cold over the new cars. The normally is a powerful spur Kinnard & Co., 133 South Seventh
to sales, the issues in this sec¬ Street.
independents, however, have
had little in the way of a fol¬
lowing, with StudebakerPackard sinking into new low
territory since the merger,

while

NEW

staff

TV

Co.,

(Special to The Financial Chronicle)

subsequently.

Chronicle.

Automotive shares continue

nected

With State Bond & Mtg.

17

j

Fine

OF
Street

BANK
NEW YORK
corner

of

Nassau

Member Federal Deposit Insurance Corporation

Co.,

Hotel

UW,L

i

18

(rM

ii\ tf

%l.* Wx.

JflV-W

The Commercial and Financial Chronicle

(2154)

economic

America's Stake in World Trade

be

Corporation

what he termed "sufficiently compelling reasons
expanding our foreign trade operations, Mr. Ramsey lists
obstacles to this goal as tariffs, taxes, discriminations, and
lack of currency convertibility. Asserts, despite obstacles and
harassments involved in foreign trade, an increasing number
of businesses are looking across national boundaries to invest
and to establish plants and facilities abroad. Points out this
movement is aiding the economy of foreign countries, and is a
private "Point Four Program."
After giving

required from our

cans

owe

Our

output,

nies

of

the

of

this

and

nature

trade

i t

rela-

s

tionship to our

U.

alone.

S.

long ago:

J-

American capital.
Fourth,

5%

of

figure

in-

dicate.
As

the
truth is
cannot live

plain

ingly

nation

a

as

we

without

We

them.

increas-

are

"have-not" nation in many

a

fields.

Although

we

con-

are

searching for substitutes,
we
still depend on the outside
world for all of our tin, mica, astoestos and chrome, virtually all
of our nickel, cobalt and mangaoese, two-thirds of our bauxite,

r>tantly

and

half

than

more

of

of

our

copper.

roie
to

Canada

and

half

quires

nickel

world

in

more

tainly

chrome from Turkey.
For

An

jshould

much

be

An

*re.

investments

have

foreign

would

undoubtedly

help to our foreign policy
strengthen the econ-

of

be

sub-

management
the

man's

of

abroad

tance

friends

our

believe

I

of

these

sj0n

made

jGb here in
A

that

allies

and
the

imoor-

considerations

,

.

^

expanding

think of

can

business

sound

en-

at least

reasons

for

First,
Iiad

there

is

construction, the major countries
free

substantial

world

are

measure

achieving

of economic

stability, increasing their produclion and purchasing power. At the
same time, important progress is
being made in promoting the eco¬
nomic development of other na¬
tions.
In
the
long
run,. huge
markets
abroad.
icans
the

remain

absorb

other

than

the

almost

more

fpfwSfnr
-T

Fncfiarld

rllonv

i*

f
.

jf

do

Wg

not

our Present

aTld then another tax when earn- cies before the war were

brpught here. Ironically,
the American tax not only -discourages companies who want to
develop business abroad, but is
not even a good revenue-producer
for the government. The Randall
ings

some

of

d

d

*

urged

to

come.

yield

here

become

sharply competitive.
leads to my third
address

by

Mr.

16, 1954.

Ramsey

'




relief- on

tax

Yet

the

is

goal

and

before

'

possible, and practical, to approach
the high objectives of Public Point'
Four through private initiative
and private investment funds. * I
v*t.e wi+h interest that the Randall
Commission Report strongly op-posed grants-in-aid to underde-,
veloped countries and insisted that
private capital do the job. As a
matter of fact, as you know, many
private companies are now doing
a job—and doing it very effectively. The activities of Sears,

are

General Motors'

worth

cUr?ent

the

overseas

the

way to

we send abroad may be more valu-

able to us and to others than our
goods or our money. Our concept
©f free capitalism—our philosophy
°f mass production—our sense of
the social responsibilities involved
in what we do—our awareness of
the great potentialities of high in-

Jbe world and thus lay founda^

5

strength of the principal countries

(2) Export-Import Bank
Another

fh

of

stimulant-our governBMuiui«n.v«i-6wvw.r

Europe,.is

gome

growing

oper-

ing-

the

steauny.

.

,

..

.

-

.....

-

may revolutionize the thinking of

f1Qns for far greater. productions
consumption abroad.
I1^

relaxing their rigid gov-

are

the world, the

many areas of

industrial
is towPrd frPe.

goals and practices of business
stem largely from notions which

and putting in-

date back to the 18th and 19th

oven

economy

WesteTn

r^ppnfu

Europe

which

finance up to as much as $10 mil-

Prostrate in 194b, is again the \icm of unpaid balance on foreign
^ ^
°Arders- Let's suppose that a Latin
He points

American

fact ^at Europe—contrary from

country

wants

buy

to

g a D00rianomic welfare and development
} am sure tba^ y°u will agree of the country in question, but the
with
that these are sufficiently- purchaser cannot buy it unless he
#

comPeIUng

reasons for expanding'is given five or six years to pay.
©«r foreign operations. The ques-vFew> American companies are in

n°w

arises^ "What- are the a position to extend this kind of
before us credit. If, however, the -Export-

©""culties which lie
we

Function

of

overcome

them?"

seemed to enrich the few at the

j think

can business demonstrates contin.
ually that under the mass produce
tion system everybody—the consumer, the worker, the investor—*
stands to gain, In some areas of

should work

we

this goal

Import Bank underwrites- 60% of

\
.

.

Importance of Atlitudes

,

.Of

course,

for trade
simply by

a

favorable

a

climate

the world where

Very

sHll
idea.

brought

not

attitudes.

much

All of

depends

engaged in

us

foreign trade know the impiortance
0j

such

expense of the many,

about
checklist of favorable

is

.legislation;on

toward

'

American manufacturer.;

an

i ©xpe^tatl(?ns, was not af- the equipment needed for a 5,000
Ul5y' JIencaf
r^es" kinowatt power station. This plant
^
contrary as been will contribute greatly to the eco-

and how do

possible-sooner perhaps than
mj«ht be exp^cte^
I hope so and

factors

as

common

few are rich

and the rest have nothing, this iS

»

lan-

It

a

to

seems

hard-to-believe

and

new

contributed

me

that

ideas

the

American

by

enter-

prises

abroad

-velon

the

nity toward foreign capital.

countries- and that they will have

The

are

helping -to

economies

Z

Government

a

But Ameri-

guage. common lpgal tradition, and
attitude of the business commu-

de-

foreign

of

iDflUenCe "
benem
-

Pess or enterprising snirit. Amer-

I

am aware

that

some

of my

col-

able: climate of attitudes is basic

trade.

Our

in 'the

business

-world

on
,

to

our

success.

verv

me

20th Century businessmen have government I sympathize with that d
-te
u the obfetacles and
tbese same q u a 1 i t i e s in even their general point of view, but it harassments involved in foreign
ndance
greater abundance today.
seems
me quite proper and trade as compared with the easier
.But, under the present condi- legitimate for our;government un- attractions of our domestic mar.

i

.ii!,

J

n

^

oftro nfiAnt?

1

U°(ns °lmanaged currencies and der present world conditions to
nat,onallstlc controls, the private g've this kind of backmg to Amerbusin©ssman alone cannot bring ican

across

Ant*

are

these liberalized terms American

and

facilities

industry

Gur

own

ton

satisfies

trade.

If

Private foreign investments abroad

reach

10

a

to

"lv/r

nrnfit

ridicuiouslv

low

wuoiiitooiiicii, ^inany

6V0^mno?n^th<^ th^
Tu.iness h^ chanfed
effort

thi

^

attitude

mor_

_

extremely

Instead
,

high

of
r

reaping
o

VJL

profits

1V.

on

ex-

'remeIy low-volum^ the foreign

businessman has begun to try

enterprise 'abroad. -Under vest capital and to establish plants the American method—because it

our

world

r»

looking
national boundaries to in-

needed

in

rl nmncti

In manv^forefgn

of profit.

congi^ed

once

Our Attitudes Are Chans,n?
it is
encouraging

To

One ol these is tbe.ides of large?

cen^age

rountrip's
.

about the improvements that
point,

:

dividual worker productivity—

was>

t

for

feeling of
filing nf discouragement may he
mnv be,
as unwarranted as the great opti-

DUSI ess 10 come port-Import Bank's lending

T innmann

served
t«at

paid

ations' Underthenewprogram centives back int0 operation. All centuries. The average man is unP.^7 a" exporter will be able to^ar- this helns to lav a foundation that able to observe any real benefits
great underlying fact range a "line of credit" to help wiu make
currency convertibility for himself in
a system which

Walter

«

and

mism of September. The economic

-

COIpe

x' e

a great

certainly

a^VoUt rffJrt

p^h1s irnoUmeTo St ment -beian applying
i?st ernment" controls"
back yand expect busineI t0
week is the expansion of the Ex-':outout The trend
a

°t ' Private Point Four" has great
advantages over any program—
n0 matter how admirable in purPose—that is carried out by gov-

Wldely known.

stimulant to trade, and that free
currencies tomorrow would again
establish this fine state. But free
'currencies TODAY—well, that's a
different matter.
•

t

*

-

feeling that this kind

my

strong support.

Soviet trade

-th Euronp uat?

^ is

foreign investments and Ideserves
believe
this recommendation

markets as well as
ones.

-

„

R°5biUCk, M Lat£ America

r'nrmcl**

Undoubtedly the greatest stimuiant to world trade would be the

^

we

®Js' w®

stand in danger of losing

^

~

ex-

.ODeration(5

,

^

Unshackling Foreign Trade

too much business dependence

e?gn41TradenVCouScii°f NewN York*1 city

Nov.

Thp

.

_

operations are well on
approaching the bilWhat are some of these more return to free convertibility of all lion-dollar bracket. And these are
liberal and constructive policies currencies. Only a few months only the more conspicuous of many*
that can help remove the other ago the experts had high hopes examples,
road blocks? I think American that the day of convertibility might
infi,,*™*-«f
business has much to gain by con- be at hand. But these hopes were
Anc
or iaeas
stantly emphasizing, for its own dashed at the September meeting
As we survey the whole broad
benefit and for the benefit of both of the International Monetary field of world trade, it seems to
government and the public, these'Fund. Afterwards, one commen- me that we must not overlook the;
positive steps which can be taken, tator, Lawrence Fertig of the New tremendous importance of the ex/n
nPijpf
/
York "World Telegram and Sun," change of ideas. We import, unlu.iax itenei
likened the situation to; a famous derstanding of the other fellows
One positive action, is tax relief scene in "Alice in Wonderland." problems, and we export, in inon earnings from abroad. As you When Alice asked for jam, the creasing numbers of ways, anknow, American companies with White Queen tniri her: "'The rule American point of view toward
told
twnw Am^ripar* nnmnanipc with
!,|Th0 v..io American nnint nf view toward
overseas operations are subject to is jam tomorrow and jam yester- people, markets, production, disdouble taxation in many situa- day—but never jam today." Ev- tribution and standards of living,
tions' paying heavy taxes abroad erybody agrees that free curren- It is easy to argue that the ideas
i

,

__

n^!L0f,oV,W
ingenuity in world

can

This
♦An

,

,

.

sion of trade. American businessmen, nurtured on competition, do

nf

.

ernment direction

blocks to world trade. Discriminatory laws which put Americanowned enterprises at a disadvantage, seriously hamper the expan-

rnnvprHhilifv

.

with taxpayers'dollars. It is both?'■'

.

(5) Convertibility of Currencies

leagues

This couM change as

conditions

protection against ir.con-

would regard this sort of thing as

tT™sSOandtt|nvlsVtorsthareCs°owrto
business

stiff

pK

i

was

private Fomt *our i

Op-

Foreign countries, in their turn,
can
remove many
serious road-

their potentially greater contribu-

„

revis-

vnrtthUjty, expropriation and con-

tion."

°* Yankee Clippers have been

good return on investment,
present the yields here at home

look abroad.

must

lcan traders since before the days

very

At

business-

goods.

limitless

years

Second, foreign trade

in

the

jng j^s investment guarantee proshould be helpful.
It now

includes

or

among

divided

opportunity in the

a

one-half

manufactured

is

Foreign

Administration

orations

impres-

each

be

to

more

half

suggest

ures

abroad

developed
Today, 160 million Amer-

world's

The

R

\°

businessmen ought to
getting
their
share.
After
nearly a decade of postwar rethe

chnnid

increasingly

custorr)erS

\°

American

a

should ^
ex
operationsU

ahrnad-vtTJf

nc

d

be

to

and

here

Commission

business—and

business

abroad—good

be

©f

foreign

\

?

*

top

a

7M7r«,i,v
reason

tneir part m the worid.

foreign investments:.

our

in

.^f™a,y'

is

foreign trade and

our

Q

*

.u

be

may

five

final

nnmnanfic
companies

face

hnQtfp

TT

deci-

a

the United States

their
we

inde-

an

before

put him

important future

Ar™\b"SineSS;
While I do not overlook the
difficulties
which
1

chance to evaluate

to

and

oand

f

reduced

were

other governments, and

-

generally accepted today. In addilion foreign trade is important to
us strictly iron the viewpoint of

countered

a

capabilties in

pendent command

new

would

©mies

same

trade

stantial
and

and

the

found

larger than they

expanded

cer-

of other

executives

onTSriintsWenftSp

foreign trade

our

foreign

our

has

It

a young man who is
being groomed for top responsibility in a corporation will benefit from the independence of responsibility which he can get
overseas.
It also gives the home

tn

I believe that
and

who

women

thing—that

pnmnpfitirtn

Foreign Trade

more

experience

my

that

companies

thai

Expanded

and

abroad.

been

sure

it needs

commerce

men

dean
American

Need

an

action of the

recent

operations pro-

the talents of

draw upon

and

Our

from

nearly

lead

our

give

this connection

In

COmpany.

training ground
young Americans. If the United

ports,

Hobart C. Ramsey

that

"or

cen-

a

never

a ]

foreign
trade would be greatly stimulated
our

excellent

an

have worked

im-

for

that

too,

develop and implement more lib- not expect any special privileges
eral and constructive policies in or rights. But they do want equal
several fields before international treatment in the race against complay its most effective trade and investment will make petitors.
'

states is to

would

j

elimiriated. This is a most "nfo^una+e
simplification.
In my
opinion,
these
tariffs are only
a
small,
though
important, part
of
the
whole problem. Our government,
tariffs

our

men

overseas

much

the

slow
offer

may

atractive alternative outlet for

an

vide

greater

that

investments

foreign

its
importance is
than

think,

than

more

tury and I think there

gram

"Statements made both here and

-

extent

plant expansion

down,

domestic
economy,

the

To

world trade for

s,

qualification. Eugene Hoiman, Chairman
of the Board of
Standard Oil Co. (N. J.) said not

month goes into insurance compa-

because

but

Earnings

Thursday, November 25,1954

.

.■»

some

institutions at an enormous rate
today.
Nearly
$350
million
a

na-

our

tional

of

and Capital

.

export trade amounts to 5%
of

Federal
from the

whether this opinion doesn't need

abroad sometimes

-economy.

Repatriation

which is that pressure is rising sion that there is only one road- fiscation.
for new outlets for investment, block, namely U. S. tariffs. All
Funds are flowing into financial would be well, some contend, if
(4) Discrimination

trade is vital to our
Some 3,000,000 Ameritheir jobs to exports.

Foreign

(3)

reasons

own

.

for

v

and for

policy, cooperation will

.

time when the foreign field
government, as well as
seemed to us to have greated pogovernments of foreign countries,
the United States were to nego- tentialities.
Furthermore, an efT
-ff
tiate more bilateral treaties with ficiently operated and profitable
V. '
/
foreign nations to permit remit- business abroad can provide local
May I say at this point that tance of earnings, repatriation of employment, and make a substanwhile American tariff barriers are
capital, and full compensation in tial contribution to the general
commonly regarded as one big case a foreign country expropri- welfare of the country in which it
obstacle, I sometimes wonder a^es
property of an American is located.
-

RAMSEY*

By HOBART C.

President, Worthington

reasons

of foreign

.

is

out

going

into

to -be

greater

able

to

markets

in

other

countries,

experience at Worthingus

that

the

foreign

pays.

This has been

an

important

factor in the gradual decline of

capitalism of extremes, which

a

cre-

are to ^ blcreased> if °ur foreign and also be of greater assistance field is attractive. As a matter of ated the kind of social problems
trade is to be stimulated both for

to under-developed countries.

fact,

we

have

been

engaged

in

that

encourage

people

to

accept

Volume 180

Number 5380

.

The Commercial and Financial Chronicle

.

.

(2155)

the

desperate alternatives

of the

Modern

ideas and

management

techniques are perhaps our most
important expert. The concept of

ploughing
business

profits

back into the
further development

for

is vital

to

the

business

of

success

anywhere; equally vital is the idea
of carefully worked-out sales and
production programs backed by
expert sales promotion techniques.
It

is

belief

our

see

with their

own

eyes

what

pro¬

With Remmele-Johannes

ductive capitalism can do to bene¬

Communists.

that

modern

(Special

fit the average man

and raise his
standard of living. This may well
be the most important contribu¬
tion

American business

abroad.
the

Assuredly,

compelling

it

can

is

make

one

why

of

to The

Financial

Caiiforina Inv. Add

Chronicle)

(Special

DAYTON, Ohio—Mrs. Virginia
Eisert, John H. Gogstetter, Louis,
A.

William

J.

Walter

Four With Daniel Weston.

Chronicle)

LOS

ANGELES, Calif.—Joseph
Borden, Eugene R. Cuthbertson, Edward W. Mitchell, Robert

James B. Kennedy, Clifford Winand

Financial

(Speciaj to The Financial Chronicle)

'

BEVERLY

L.

Jacquemin, Leaton F. Jenkins,

ans

to The

A.

have

D.

gene

Ozier,

Meyer, Gordon C. McCormick

HILLS,

Faierman,

Leonard

and Bruce A. Johnston have been

Raymond G.

become associated with Remmele-

added

come

to broaden and extend the foreign

Johannes

Investors,- 3924

operations of American enterprise.

Avenue.

should do

reasons

everything in

we

our power

&

Co.,

1126

Oakwood

to

the

staff

19

of

California

Weston

Boule¬

vard.

&

Nl

Sholdar

and

Thompson have be¬

affiliated

Drive.

Wilshire

A.

Calif.—Eu¬
Charles

with

Daniel

D.

'

Co., 118 South Beverly

in¬

dustry

has important social obli¬
gations to perform, and that mod¬
ern
enterprise is a trustee of a
of

part

society's productive re¬
By translating this belief

sources.

into
sell
of

action,

may

we

well

very

capitalism abroad to millions
people

have

otherwise

would

conception of the Amer¬

no

ican

who

meaning of the term.

We at Worthington regard our
Foreign Student Training Program
as
of
prime importance in this

regard.
about

the

Each

-

25

year

countries

America

and

of

of

our

some

These

from

South

Europe,

the

Far

East, where

plants

located.

are

young men take the
of training in
our

course

classrooms

and

receive

we

engineers

young

student

home

as

apply

50

then

what

v

re a s o n s

return

they

industrial

i 11 Ion

shops

W

have

learned. They take back with them
a
better understanding of the

American

m

American

our

engineers,

to

same

system

—

for saying

a

better

grasp of our management
methods—because they have seen

»•

•

v

them in operation.
An

outstanding

example

is

a

young man who came here to par¬

ticipate

in

Training
World

Program

War II.

sistant

Foreign

our

associated

shortly

He is

Manager

after

now

the As¬

our

of

Spanish

company.

idea of service,

The

Student

and still is to

which

countries

some

was

This week General Motors is cele¬

com¬

pletely unrelated to business, has
been
fostered by the export of

brating

the American view of

National

capitalism.

story is told of
West

Germany,(who ^stopped

take

a

nap

find

to

up

night

one

someone

that

woke
from

gasoline- service
cleaned
his
truck,

s.

station

had

checked

the

oil, and hung

a

red lamp

the back/He had stopped half

on
,

to

and

a

tires and

mile from
Finally,

have done much to
dramatize the idea that improve¬
are

we

in

ments

the

brought

of

standard

about

living

not

through
government generosity but by
greater productivity in industry
and agriculture. We have
empha¬
sized this by deeds,
not words.
We have forged the tools, we have
the machines,

made

we

have

as¬

sembled the equipment by which
the working man abroad, as well
at home,

as

increase his pro¬
ductivity and thus raise his stand¬
ard

of

can

For

all

capital

these

reasons, it seems
that private American

me

in

succeed

can

are

Here at National Steel, too, we

its

Gfen-

.

.

and well done!"

.

this automotive event because it

American

the

us

of

progress

industry and its

ever-

increasing contribution to

a

Within

promoting

a

few

score

moving ahead. Within the
Steel organization is

are

National

many

nation in

especially pleased at

symbolizes for

every
1

million tons of

National's

year.

quarries yield the
Its

the

growth of industry has reshaped
way of life. From a nation of

isolated farms and small
nities
tion

we

on

have grown

other

people

mobile

a na¬

do

on

industry

more,

can

justifiably be

proud of the important part it has
played in this over-all
General Motors'

50

progress.

millionth

is merely a milestone

wheels

are

.

.

.

the

still rolling, the future is

bright. Nothing is

so

powerful

the force of progress on

materials.

boats, barges and trucks

mills

melt, roll and finish

range

a

as

the march.

major

bon

a

sup¬
car¬
i

steel

products,

and is the

largest supplier of cold-

in automobile

National

Steel's

growth

been constant—and its

keeps

pace

future call for

and

opment

to

years

National
say

.

.

.

plans for the

even

greater devel¬

progress

come

Steel

has

ability to

with industry's

National's

needs.

quantity

manufacturing.

...

can

the

over
so

that

continue

to

Serving America by

Serving American Industry.

lic funds may fail.

Benjamin Fairless of the U. S.
benefits of public works programs
with
what
he
called
"private
works programs." He pointed out
that public works programs afford

only a stop-gap solution to the
problem of unemployment, be¬
the

cause

project

public

average

seldom

has

it

works
-

after
Private

been completed.
projects, he went on to

say,

entirely different. "When new
industrial facilities are built, they
not only provide temporary work
the

plant

men

chines

who

who

and
and

construct

produce

the

the
ma¬

materials that go into

it, but they also
nent

jobs to the

who

will

open
men

operate

up

perma¬

and

women

the

enterprise

thereafter."
r

I

know

answer

the

of

no

more

effective

to Communism than to let

people

of

CORPORATION
VlmxV

PITTSBURGH, PA.

SEVEN GREAT DIVISIONS WELDED INTO ONE COMPLETE STEEL-MAKING STRUCTURI

GREAT LAKES STEEL CORPORATION

WEIRTON STEEL COMPANY

NATIONAL STEEL PRODUCTS COMPANY

NATIONAL MINES CORPORATION

anyone

are

for

GRANT BUILDING

works

provides continu¬

ing employment for

NATIONAL STEEL

foreign




countries

STRAN-STEEL DIVISION

HANNA IRON ORE COMPANY

THE HANNA FURNACE CORPORATION

t

.

•

world's

serve

\r

:

of steel products.

economic advancement where pub¬

Steel Corp. recently contrasted the

•

wide

plier of standard and special

than any

earth. The auto¬

and

mines

raw

rolled sheet steel used in

into

into six

transport them. Its furnaces and

commu¬

wheels. Americans travel

more, see more,

ore

ingot steel each

National Steel is

years

facility for

and

resource

the transformation of

our

car

living.

clear to

the

the

"Congratulations,

saying,
We

join

across

eral Motors
I

of

higher standard of living. *

Ssso garage!

an

v;

truck driver in

a

Steel

thousands

,

production

millionth automobile. We at

50

The Germans, for example, greeted
the
idea with
enthusiasm.
The

the

'•

f

.

20

The Commercial and Financial Chronicle

(2156)

it

Gold, Money and Men—A Plea

the

familiar

a

incorrect

but

quotation from one of St. Paul's
Epistles. What he said was—"Love
of

Constitutional

and

powers

regulate

the

passed

defined

This

dollar

the

be

metal.

love

of

bad

able

paper

irredeemable

is bad

and
was

have

period of 17

a

during and after the Civil
War when specie payments were
suspended by the Government,

money and
that's what
we

stand¬

years

evil. Irredeem¬

money

either

as

with gold until

money along
1873.
There was

tap-root of all

of one, to

Silver remained

ard

the

is

money

of gold or

with

interchangeable

of

and

serious

of

Act

day. More and

Inflation

tive

on

followed

the

until

continued

thirst after to¬

sort

money

paper

issued, Greenbacks.

a

for

in

money

is

world

industrial

the

a

and

Resumption

1875; which became effec¬
Jan. 1, 1879.
The country

The

economies

be found in the

is to

answer

In short,

frailty of human nature.
gold is

trustworthy than hu¬

more

nature.

man

historic

busi*

of

credit and banking?

money,

is

It

that

fact

undoubted

an

gold

as

com¬

a

exchange and
silver

right

ran

to

up

more

keep

us

to

*

debased

dollars to help

up

our

veins.

The return

fully-redeemable gold stand¬

a

ard in the United States is of vital

if

importance

sincerely wish

we

price of $20.67 per

a

This then

troy.

faithful
the

world

for

to knock any sense into our money
and
make it our honest servant

the Roosevelt

again.

bullion

,

,

The late Prof. E.

simple

W. Kemmerer

definition

gave

a

Gold

Standard

follows:

as

Gold Standard is

the

of

"The

confiscated

In

years.

1933

government not only

all

the

in

throughout

good
54

ounce,

the

gold coin and
States

United

but

it debased the dollar by over 40%
and

the profit in

took

the "clip¬

ped" gold dollar for itself.
For 20 years since the Gold Re¬
serve
Act of Jan. 30, 1934, this

monetary sys¬
tem in which the unit of value,
be it the dollar, .the franc,
the country has suffered from the rav¬
pound, or some other ; unit in.' ages >. of an irredeemable paper
which prices or wages are custom¬ money—and a glut of gold hoarded
arily expressed, and
in which by the Treasury.
Although the dollar is now of¬
debts are usually contracted, con¬
a

sists of the value of

tity of gold in
The

most

a

fixed quan¬

free market."

important

that definition
fixed

a

are

words

"the value of

in
a

quantity of gold." By value
purchasing power of

is meant the

in

gold

terms of

other

all

com¬

modities.

Under a gold standard
the price of gold is fixed. That is
to

say, there is a fixed quantity
weight Of gold in the monetary
unit, but the value of the gold
(or the gold coin) changes con¬
stantly as the prices of commodi¬
ties and wages fluctuate. A gold
standard, for example, could not

or

possibly be
ing

so

a

many

lump of gold weigh¬
grains—it must be

the value of the gold of
standard

weight

certain

a

fineness.

and

Most of the difficulties in

under¬

standing the nature of
standard

of

money

a metallic
have arisen

through

failure to
comprehend
that the quantity or weight of the
metal is constant, but the value of

that

metallic

change
level

in

of

content

relation

all

other

to

is

free

the

to

price

commodities.

Government must always be

ready

to

buy and sell gold in order to
maintain its official price. To this
there

is

management

money,

but

it

is

based

the universal and endur¬

extent

on

of

management

ficially worth 15.24 grains of gold
9/10ths fine or 13.71 grains pure,
and gold is accordingly priced

at

$35

per ounce, it is unlawful for
American citizens to obtain gold

with their paper dollars or bank

This

deposits.

privilege

is

re¬

of

value.

Mercy is not strained."
We
might say the same of gold—its
quality as an element is always
cannot be impaired.

and

same

Gold,carmot be counterfeited

and

it is beyond the power of govern¬

ments to add

more

than

increment to the stocks

men's hands.

generally
measure

accepted
of

a

nominal

already in

It remains the one

capable of serving
value

commodity

as
of

a

all

common

services

Most people in the gold-mining
industry and some economists feel
that before returning to a redeem¬

able

gold standard, the price for
should be raised above $35
per ounce in order, as they say,
to permit gold to reflect the up¬
swing since 1933 of general prices.
To be fair, they should compare
gold

which would

standard

about

as

effective

as

a

the present level of general prices

show that the gold
price and the wholesale price in¬
dex

have

both

risen

about

70%.

truly been deprived of our
natural right to possess gold, a

Moreover, today's world price of
gold in free markets shows only
a small premium over the official
price of $35 per ounce. No doubt

right

the

Watch

with

Dog

teeth.

no

We

have

Such
of

is

old

as

the human

emasculated

an

money

as

means

unsound

and

that

nesses

of

standard

dollar

our

stream

of

domestic

gold-mining indus¬
try has been unfairly treated by
our
government, for it has been

politicians, the weak¬ only
It is stage

selling

price

Uncle
Sam's price of $35 per ounce. The
South African gold miners, on the
other hand, can sell gold in the
one

—

free markets of the world at any

tory.
1

indulge in

a

bit of his¬

In 1792, Congress under its

Value,

erties of

as

used here,

means

the coin.




the

prop¬

dollar

the

at

fixed

a

no

and

little
lends it¬

virtue in it.

confuses

and

It

cor¬

under¬

bank deposits and all the devices
available along the primrose path
of

price

gold. Our first job, they be¬
lieve, is to get our budget bal¬
anced, get living within our in¬
come, get a sound situation thor¬
oughly established, and a good
deal

more

along similar

progress

than

lines

exists

now

should

made throughout the world.

be

This

Administration's

the

is

present
"Now is not the

line of thought.

time" is the chant of
the

our

the

and

Treasury

officials

Central

bank.

economy and

trollable

The

result in

an uncon¬

spiral of inflation.

Current

International

It does not

apparently

occur to
that the
fiscal problems which confront the
country would be easier of solu¬

these

tion

managers

money

i| we began the cure by mak¬

ing dollars fully convertible into

gold.So there seems little hope
of a change from our present ir¬
redeemable

paper

For

Situation

What then is the situation fac¬
monetary magic.
It makes it
difficult for the free-enterprise ing us as of now?
Well—there
system to work smoothly because was and is no hope of restoration

system

money

long as these officials insist

so

on

putting the cart before the horse.

'\

*t

Single Law Will Do

A

to

Gold

a

price of gold rather than restore
Convertilbe

a

the

at Fort Knox, in the

the

support

of

a

the

at

We will

probably have to act on our own
if we are ever going to take the
plunge of restoration, and in the
long run such an action would not
only benefit the United States, but
would be of great benefit to the
world and would go far toward
reviving normal conditions in in¬
ternational trade and peaceful re¬
lationships
and
a
world-wide
the currencies of all

standard for

There is nothing implied

nations.
in

convertible

a

that

would

Standard

Gold

from ex¬
tending and continuing to extend
credit throughout the world where
credit is warranted, both from the
creditor's

prevent us

interest

and

the

bor¬

rower's.
The

late

Benjamin

Ander¬

M.

economist,

eminent

son,

wrote

once

follows: "There is

as

a

myth

widely current that prior to 1914
the

world

rather

Standard

the

on

was

than

Sterling
the

Gold

Standard, that London controlled
the Gold Standard and it
the

superhuman
which

don

made

it

only

was

wisdom

in Lon¬

work.

The

doctrine adds that when New York
the center

become

after

1918

the

lacked

York

London's

wisdom.

Now the fact is that London had
far less control and

responsibility
prior to 1914 than did New York
after 1918, and that policy played
a

much smaller role in the earlier

period.

There

Standard

Gold

many

were

markets

money

com¬

peting with London for gold prior
to 1914, several of them very pow¬
as New York, Berlin, and
Paris and many others of real in¬
fluence
as
Amsterdam, Vienna,

erful,

the

Switzerland,
and

Countries

that

one

Scandinavian
These all

Japan.

another.

All would

from any country

away

Gold

A

credit,

over-expanding

was

and force it to pull up

."

.

.

Standard

Money

is

no

if they
There

guarantee of fiscal health, but an

larger ratio today of gold in
to the total money

irredeemable paper-money carries
its own disease with it.
A Gold

so

is

our

and for the redemption of

that money by our citizens
choose to possess gold.

Standard

Gold

present fixed price.

pull gold

for

hard¬

a

foreign nations, including Russia,
might like to have us raise the

steadied

banks

re¬

in this

on

billion,
money

that the

Standard

foreign nations. There is
no
proof of this either in prece¬
dent or in reason although some

ship

single law passed by Congress
signed by the President is all
that is needed to place the $22

and

now

Influence;

Certain people fear
turn

V

Gold Standard failed because New

;

.

country

(money and demand lia¬
bilities) than we have usually had
in the past when the Gold Stand¬
ard was operating successfully. In¬

Standard

may

rails

railroad track—the rails

deed

nothing
country

supply

we

still have

the world's
is

the

drawn

our

from

then

gold will be with¬

banking system
by individuals.
mainly

efforts

of

Secretary

under President

try

of

This
skeptics

the

and hoarded

1879

those

to

answer

who fear all

about 60%

monetary gold.

through the
Sherman,

John

of

the

Treasury

Hayes, this

coun¬

redeemable
currency with a very small back¬
ing of gold.
At that time many
experienced financiers (Sherman
resumed

a

gold

from the Treasury on
of resumption, and

rupts

not

the dis¬

given

There is

reserve

very

mines public morality and dangles an increase in the
price of gold is
for the yellow metal before
the eyes of our rulers the
only a smooth way of saying a
right of people to de¬
constant temptation to create more devaluation of the dollar.
What
mand and receive gold coin in ex¬
money for government spending, we need above all is fixity in our
change for their paper money.
deficit financing, borrowing, mon- gold dollar—and we have it at
tizing of the Federal debt through $35 per ounce of fine gold.
A Bit of History
us

have

referred to them

fractional

does

it

price obtainable.
The plight of the American gold
restraint.
Such money
miner is certainly not. a happy
self to the extravagance by Gov¬ one but
unquestionably a tamper¬
ernment and to uncertainty in the ing with the
statutory gold price
business and financial worldtoday might be disastrous to the

our

banking system .with

and on the

Let

but

tinct impression that

In

desire

ing

Department

heroic

money.
This so-called money can
be
manufactured in the
blood¬

convertible

a

that there
was
any
clear
promise made in this plank of the
platform.
It might be called a
well-hedged expression of a pious
hope—a counsel of perfection.
High officials of the Treasury

its product, and is permitted only
one
customer. Uncle
Sam, and

the

restore

seem

It is de¬
upon

to

Standard,

cut off from all world markets for

of statesmen, and the psy¬

chology of the public.

Gold

in

unredeemable

anything of substance.
pendent for its value
whims

race.

promise

We

the press today ref¬
the Republican party's

to

erence

>•1

tional relations and work

in

see

A

gold in industry.

we may

often

of life.

country would upset our interna¬

of such sta¬

fully convertible gold basis."

and goods.

with the period in the middle '20s

While

free way

influence

use our

economy

bility as will permit the realiza¬
tion of our aim of the dollar on a

in

Shakespeare said, "The quality

the

money has gone hand in
hand with the growth of industry
and the flourishing of America's

monetary
domestic

a

of

served to Central banks of foreign
nations and to domestic users of

correctly affirm that we are on
a
Gold Standard, it is a hybrid

world

a

hold

gold a close second
modern times.
The

denominator

good and

was our

dollar,

and to

restore

story in this country that our

sound

with

duced

cry,
more

the

improved ftpnbeen

It has always

measurably.

inserted

was

following

to

value

of

at home in

our

and

the

vocate

and certainly

measures

served their purpose

with the parade of
national
extravagance.
For
20
years we have been imbibing the
bad-money drug and it is right

dollars is

more

pro¬

they have no
modity-money has shown itself- plans at
present for a return to
superior to all other types of the Gold
Standard as far as a
money.
In primitive times
the domestic redemption of currency
exchange
of
goods
was
done in gold is concerned.
That may
through barter and later on by come about at some later time,
using crude forms of commoditythey believe, but there are too
money, such as cattle, lands, to¬
many adjustments that have to be
bacco,
grain,
seashells,
knives, made first.
Of course, as they
various metals and finally silver
say, we are now on a kind of Gold
and gold.
All of these media of Standard to the extent that we

principal reason why gold has
was thenceforth on a strictly Gold
largely supplanted silver as stand¬
Coin Standard and remained so ard money, as it did for instance
until 1933.
in
England in 1821, is because
The dollar became the equiva¬ gold
has
a
greater scarcity, a
lent of gold at the rate of 25.8 greater
stability of production,
grains 9/10ths fine, which equals and in other ways is more suit¬
23.22 grains pure gold, which pro¬ able for coinage and as a common

Lewis P. Mansfield

elected

was

economy

Only Workable

standard

modern

derstand

the other and caused the dollar to

that

the

thorough-going redeemable Gold
Standard?
Why would it not be
possible for us to continue with
our
paper money properly regu¬
lated by those in power who un¬

evil."

is true, then it

ap¬

welfare

general

following statement—"We ad¬

policies,

Buy why is it true that the only

so many grains
silver in a fixed ratiq

follows

—

workable
the

con¬

as

re¬

never

for

to
"coin
the value1
Mint Act.

taining

this

Ap¬

to have no intention of

the

victim,

Standard

money is
the root of all
If

What about the

this Administration

parently

hower

its

onto

Gold

at Fort Knox, in the

thereof"

persuasion.

Republican Administration?

moting the cause. Although in the
party's platform on which Eisen¬

leases its hold until it is removed.

money.

money

Deal

Standard

of the Fair

pears

people of billions of
savings and pensions and life
policies.
It is like a

ness,

is

it has already robbed the

politicians

from those

itself

hands
Concludes, "a gold
standard is no guarantee of fiscal health, but an irredeemable
paper money carries its own disease with it."
"Money is the root of all evil."

contracts

Through in¬

Redeemable

Gold

of,a

drug which when it has fastened

a';' world. Says high officials in the Treasury Department give
the impression that they have no plans for a return to the gold
standard as far as a domestic redemption of currency into
gold is concerned, but Contends that a single law is all that is

This

future

insurance

Mansfield, after giving a brief history of monetary stand¬
ards in the United States, presents arguments why gold is the
only workable monetary standard in the modern industrial

our

discourages

their

Mr.

now

future

the

and

American

San Francisco, California

place $22 billion
banks, for redemption of

dollars

making. of

flation

By LEWIS P. MANSFIELD

of

of

payable in dollars.

For the Gold Standard

needed to

uncertain

renders

value

Thursday, November 25,1954

...

as

the New York

cashiers) warned the country that
it could not be done.

But it was

done, and the resumption was a
signal success.
Only a nominal
amount of gold was withdrawn
larger

amount of gold was deposited than
withdrawn.
For 10 years and

was

thereafter

the

will not

don't

be likened

to the

prevent wrecks, but if you
rails you will have

have

but

in this

If

wrecks.

we are going to wait for
economic conditions to be exactly

right—government budgets to be
balanced, government debt re¬
duced and foreign affairs to be all
sweetness and
light, before we
restore good money, we will prob¬
able wait
forever.
Things just
don't happen
wait for such

like that, and if
millenium

a

the

need

not

fluous

we

we

shall

great stock-pile of

gold we now possess.
throw it into the sea as

luxury,

give

or

faster than we

are

other countries.

If

now

We
a

can

super¬

it away
doing to

return of the

a

United States to gold coinage will
ever
a

be

a

good

thing, then it is

good thing now.
If

the first day
a

on a

we

really

wish

to

abandon

the idea of gold as a base for our
money,

at least let

about it and

country en¬

as

joyed a period of confidence and
prosperity during which commod¬
ity prices were steady and even

define

the value of

be honest

us
a

dollar, not
grains of

15 5/21

of

more

declined somewhati
ment
sues

was

The govern¬

able to sell its bond is¬

at much lower rates of inter¬

est than had prevailed

In

for years.

short, credit, business, and the

gold, 9/10ths fine, but as a piece
green paper convenient for a
pocketbook and engraved with the
solemn
promise of the United
States

of

bearer

on

That is

our

may

America

to

demand—One

pay

the

Dollar!

privilege, and that also

spell our downfall.

Volume 180

Number 5380

..

.

The Commercial and Financial Chronicle

(2157)
turn

Foresee Revised Credit and Debt

Policies Under

Managing

Federal Reserve and

employed

Washington Ahead
of the News

ments, based on the geographic
location of member
banks, is long
An amendment
to the
Federal Reserve Act
creating a

Treasury policies different from those
is forthcoming. Say experience of

past

overdue.

system

new

of

i!

and trends.

be

enacted in

the

The

"Credit

bulletin entitled

a

foreseeable fu¬

meantime, because of
the great changes that have oc¬
curred
during
the
last
four
decades, particularly the increas¬
ing importance in the economy of

tional output would increase 40%
in
less
than
a
decade.
Even

Debt
Management
Changing Economy," though some may question this
12
by Dean G. optimistic forecast, it seems
Rowland Collins, Director, and Dr. reasonable to assume
that, once banks outside of New York City
Marcus Nadler, Research Director, the transition from an
economy and Chicago, the abolition of the
of the Institute of International of shortages to one of
surpluses category of central reserve cities
has been completed, business ac¬
wpuld be desirable.
tivity in the United States will in¬
The aim of reducing the public
V ■>.
"... -4/
crease to new high levels accom¬
debt could hardly be realized in
^
11 panied by a further rise in the any considerable degree in the
standard of living of the people. near
{
k "■
-M
future, although the market¬
mBmB 1 This economic progress, in the able debt will probably decline.
|
'
absence
of
major political dis¬ The volume of
'%
'H
outstanding bills
turbances, is likely to be gradual and certificates does not
&
'
" 1
appear
and the marked by great booms
excessive, however, especially in
m
1
or
breaks. Such a type of econ¬ view
w
of the liquidity requirements
n
omy
requires credit
and
debt of banks and
large corporations.
management
policies
different Moreover, the
\
problem of reduc¬
f
from those employed in the past.
ing the bank-held debt is not as
and

Policies for

a

issued

Nov.

on

orders will be done, maybe

once

about

but will

way,

gives him

unusual

an

ki

There
Be"

is

of

none

about

assumes

have

€
%

,

-v

dynamic.
G. Rowland

Collins

Marcus

-

Nadler

Finance of New York University.
"Credit
and
debt
management

policies in the United States will
have

to

be

adapted to meet the
changed economic conditions that
may be expected in the future."
Assuming
tion

in

the

serious deteriora¬

no

world

political

situa¬

tion, the bulletin points out that
the

American

future will be
but

free

one

booms

of

economy

the

growing economy

a

from

The

.

volume

of

policies followed by the
Federal Reserve and the Treasury
in the past may be of little value
as a guide to future
policy.

agement

is

He

that, although not

been

the

the

the

the

policy,

bank

reserve

occur

a

re¬

newal of the forces of inflation is

unlikely in the

near

Similarly, there
tant evidences

of

future.

are

deflation in the

economy.
Commodity prices on
the wholesale
and
retail
levels

have

remained fairly stable dur¬
ing the past 18 months, and wage
rates, despite the decline in busi¬
ness
activity and the increase in
unemployment, are still tending
upward. Moreover, it is gradually
becoming clear that, because of
the

measures

that have been taken

during the past two decades and
the dynamism
of the American
economy, a major depression of
the type that occurred after every
and

prolonged boom in the
past is not likely to occur in the
war

future.
It
omy

evident

such

United

that

free

prevails

as

States

a

have

will

econ¬

banks

In

Because

must

growing, both

a

the

member

maintain

'

certain

4

against

reserves

their

deposits,

an increase in the means
payment must be preceded or
accompanied by an addition to

of

reserves.

from

the

factors

over

the

and
to

banks

of

the

Advisers,
an

Council

expressed

address

before

Club

of

Detroit,

when

he

stated:

of

as

an

bat

emergency measure to com¬
threat of serious inflation or

a

deflation. Open-market operations
should
normally constitute
the

through

means

the

which

authorities

serve

volume

of

serve
even

twice

between

Aug.

1,

appear

however, re¬
are too high,

1, 1953, and
would therefore

Board

to

lower

to

a

require¬

reserve

level

considered
for

needed

The

reserves

Reserve

Oct.
18,
1954,
"Today it is no

could

be

tem¬

banks.

Later

system

reserves

if the
requires
addi¬
on,

to meet the grow¬

ing demand for credit by industry,
trade, and agriculture, or unex¬
pected
needs
of
the
Treasury,
these

could

be

supplied
open-market purchases.
To

achieve

these

aims

through

ment

action,

its

timing,

extent."

and

its

bills.
the

Granting the Reserve banks
authority to buy and sell
obligations other than

Treasury

bills would enable
not

them

to influ¬

only the volume of re¬
In his address before the Na¬ serve
balances, as at present, but
tional
Security Industrial Asso¬ also the entire government bond
ciation, Oct. 25, 1954, President market, as well as to assist the
Eisenhower predicted that the na¬ Treasury in its operations. A re¬




ence

maturities.

Clyde

longer-term
somewhat

case

prevails

now

could

be

He

A

free

have

its

of

in

a

as

To

credit

fiscal

and

istration.
1953-54

that the
not

The

only

bilities

modify

also

their

will

He

policies

to

Congressman
of

Public

the

the

not

contract

private

a

provided
be

to

Atomic

power group

been

had

very interesting study of the man.
slightest disturbed over the political

raised, not the slightest bit disturbed that
such

made

be

to

slower

comes

meet

his

signed by the

or

they did when he was the head of our
when he was in command of NATO but it
by his training, is used to having

The man,

have

doubt that he expects to have his way,

no

whether

to

as

would

same

wishes

in

a

securities

Great

lost

single

a

to

pause

a

question

wink of

sleep.

winks.

They

many

a

Republican President would look the

go

down

He knows

through

that in political life his

now

chain

a

of

expects and assumes that in the political

command,

but

he

deviousness they will

en¬

in

business

roundabout way be gratified.

a

and

vard.

is in for

a

that

assume

not

do

from offices at 7750 Sunset Boule¬

Aloysius V. Kelly is

has

But there is

way.

Not Mr. Eisenhower.

Great Western DeveL

gaging

It is enough to give

indeed, prone to look most pessimistically toward the future.

are,

You

is

Eisenhower

Mr.

relatively

The Democrats will control in the next

Republican leaders of both houses have lost

Street.

—

Atomic Energy Commission.

President of opposite political faith.

any

Christensen, Inc.,

Co.

it

way.

I

has become associated with

Calif.

that

matter

than

now

nevertheless.

comes

(Special to The Financial Chronicle)

Development

this

of

approval of the Joint House and Senate Committee of Con¬

troops in Europe

to

DENVER. Colo.—Paul D. Rose-

HOLLYWOOD,

issue

an

one

Congress both House and Senate.

Western

;

*

Atomic Energy. That it took some time to bring this about
undoubtedly caused him to realize that the obeyance of his orders

With Peters, Writer Firm

17th

unmoved.

a

the

speaking, in the future.

724

an

had the slightest doubt that it would be signed and get

trends.

Peters. Writer &

worked" up

politics, and Leland
Commission, who has

gress on

changed economic conditions and

warne

has

who

Power

President is

ordered

off at least

never

the

the

ing

episode

Democrats

Yates

demonstrated

are

Power

They screamed
They sought to

Republican Senator and thereby denied
the Republicans control of the Senate. He had ordered the Dixon-

monetary authorities are
aware of their responsi¬

but

originally

knocked

manage¬

of

out

But

same.

seemed

the

policies followed

experience

former

clamor that had

effective,
be compli¬

recession

that

contract with

a

The

He

be

however, they must
mented by sound debt

Public

and

at press conferences, at his last one more recently, because
thought it the thing to do. That was it, period.

of in¬

Sound

Leftist

said

he

highlv important and
powerful influence on

economy.

ment

to

decisions

well

as

consumers.

are

exercise

the

the

The

Not in a long time have I seen such a furore as was created
the Public Power boys in this, instance. Even some of Mr.
Eisenhower's best political friends advised him to run away from,
to repudiate this arrangement.
But Mr. Eisenhower steadfastly
held his ground. He had approved the Dixon-Yates contract, he

downs, because
attitudes play
an

management

policies

bound

case.

by

and

and

psychological
important role
dividual

is

economy
ups

his atti¬

Energy Commission to
by which they would
build a plant in West Memphis, Ark., and give power to the TVA
to replace that which it must give to the AEC at another
place.

ab¬

state, municipal,
private pension funds.

was

made, and will still be made over the Dixon-Yates
a red flag
to Senators Kefauver, Albert Gore,

it is

livelihood

the

make

■

by

Carlisle Bargeroa

think,

Eisenhower back track in the face of the political

was

Ellis,

done

obligations with
a
higher rate of return

than

and

directly as would
in his military
command,
as

Olds, former member of the Federal Power

desiring spaced
addition,
some

In

No,

excellent

nancial institutions

prin¬

a

very

stubborn, determined

In his

way

he is quietly driving

I am afraid, though, that he

man.

disillusionment.

some

cipal of the firm.

Now

Two With King Merritt

On

(Special to The Financial Chronicle)

without

longer a matter of serious con¬ too much disturbance to the bill
troversy whether the government
market, it would be advisable to
should
play a positive role in change the
present open-market
helping to maintain a hJ£h level policy, which restricts
operations
of economic
activity. What we to purchases and sales of Treasury
debate nowadays is not the need
for
controlling business cycles,
but rather the nature of govern¬

and .the

however, be
by banks and other fi¬

absorbed

Not to

or

orders

Clinton Anderson and other Senators of the Public Power
lobby,
to say nothing of the non-official Public Power
lobbyists such as

effective

newly created

serve

in

deal?

the

the

view

i

reduced

were

July

ments

credit control.

the

ups

Economic

Treasury

But does

■■

bal¬

reserve

1954. It
desirable for the

minimum

Re¬

influence

member

At present,
requirements
though they

ances.

the

its

nec¬

the

Be

his

a

clamor that

by the Congress and the Admin¬

general, changes in reserve
requirements should be made only

in

Economic

this

reluctant

lend and invest.

banking

man

become

porarily absorbed by the sale of
Treasury obligations by the Re¬

Chair¬

for

sorbed

Aside

tional

Burns,

F.

to

consequences

activity.

ployment.

ernment intervention will be

Arthur

attempt

economy the volume of the means bond market in
general. A mod¬
of payment must keep pace with
erate
amount; of
medium-term
production, distribution, and em¬ obligations,
could,

and downs and that at times gov¬

essary.

An

one.

..

business

excess

is

slow

a

management
is bound to

a direct bearing
force a large volume of long-term
the availability of bank credit
bonds on the market at a time
and the cost of money, which in.;
when conditions are unpropitious
turn
exereise
an
influence i on would have adverse

In

impor¬

no

be

of
debt
this process

balances. This has

which the banks, the Reserve au¬
developments during thorities and the
Treasury have no
the
past
year,
the New York
control, excess reserves can be
University
study
states,
have created by the Federal Reserve
been
marked
by
considerable
through
open-market
purchases
stability. The readjustment that and the
lowering of reserve re¬
set in around the middle of 1953
quirements, or by the member
has apparently run its course and
banks
themselves
through bor¬
a
moderate upturn in business is
rowing from the Reserve banks.
taking place. The dangers of in¬ When the latter occurs in
large
flation have receded, and unless
volume, however, money is tight
events

goal

President,

a

household issue all over the
country. It was a splendid
piece of demagoguery. But it was such demagoguery that it hurt
the Republicans in the recent
campaign; specifically it hurt Re¬
publican Senator Cordon-in Oregon who
seemingly for no good
reason in the world was
defeated by the inexplicable Neuberger.

on

Economic

unforeseen

make it

threat

a

While lengthen¬

economy.

attitude

agitators made a tremendous issue out of this.
bloody murder about the alleged iniquities of it.

few years ago,

a

"To

leaves

An example of
this, I
tude in the Dixon-Yates

ing of maturities must still remain

of

control

to

member

inflationary minimum

major
depressions.
Hence, the credit and debt man¬
or

function

banks

the

to

:

" v;

principal

Reserve

was

when inflation presented

the United States is growing and

.

it

round¬

a

they will be carried out.

W

as

in

This

serenity for

Hamlet's

him.

•

serious

done.

it possible for him to fly hither and
thither to shoot ducks or play a game of
golf.
He doesn't sit around the White House
fretting
about what should be or what shouldn't be.

m

approach must be based on
the premise that the economy of

be

makes

•

This

a

in his political
capacity you can't just
this and that is hereby ordered and must
be carried out, he still assumes that what he

4

t

thing

against

up-

say

,,

'

interesting

he goes

as

that

^

•:

most

about President Eisenhower, I
Congress controlled by the opposite
political party, is that he is not the slightest worried. He still
thinks he will get his way. By his
training he is used to having
his orders carried out, and although his first
two years in the White House have told him

think,

ture. In the

According to

By CARLISLE BARGERON

reserve

require¬
ments
would, however, require
careful study and is not
likely to

only aware of their responsibilities, but are willing to
'/modify their policies to meet changed economic conditions
not

are

From

pres¬

require¬

1953-54 recession demonstrated that the monetary authorities

;

.

the

in

harm

more

than good.
A general revision of the
ent
system of reserve

revision from past

a

a
pegged
government,
market,
however, is un¬

desirable and could do

'

npfew York University economists hold

to

bond

Changed Conditions

21

NEW

ORLEANS,

Mildred
Martin

G.
are

Carter
now

La.
and

Jacquin,

Mrs.

—

James

associated

Nov.

D.

with

15

the

Stanley &

firm

Co.,

of

name

44

Wall

Street, New York City, members
of the New York Stock Exchange,
was

the

King Merritt & Co., Inc.

Garvin Bantel to Admit

Stanley & Co.

member of the
a

Theodore

date

become
tel

&

York

a

120 Broadway, New
City, members of the New
Co.,

On

York
Paola

has

some

time

Exchange, became

partner in the firm.

Funds

.

1, Ralph De Paola will
partner in Garvin, Ban¬

Levy,

changed to Stanley & Co.
same

On Jan.

Exchange.

Stock

been with
in

charge

Mr.

De

the firm for

of

Federal

Department.

Mutual Funds Inv. Service
LOS
Funds
been

ANGELES, Calif.—Mutual
Investment

formed

Abbey

Place,

vestment
man

is

a

Service

with

to

offices

conduct

business.

has

at 4529
an

Harley

in¬

Gay-

principal in tht firm.

Garrett

Bromfield Adds

(Special to The Financial Chronicle)

William E. Brewster Opens
(Special

Brewster

Garrett-Bromfield & Co., *350 17th

to engage

Street,
Stock

members
Exchange.

of

the Midwest

to The

BOULDER,

DENVER, Colo.—John S. Poulos
has been added to the staff of

Financial Chronicle)

E.
offices here
securities business.

Colo. —William

has opened

in

a

Associated with him is William B.
Brewster.

Financial Chronicle

The Commercial and

22

Thursday, November 25,1954

...

-(2158)
•
-

industries and com¬

of numerous

panies,

A Common Stock Fund

well

as

Banks

developments that will af¬
acquired. To do this

future

For Savings

Banks

By ALFRED J. CASAZZA*

Savings Banks Trust Company

Vice-President,

York

New

.>

Commenting
return

published data.
(2) This job can be performed
much
more
economically by a
mutual fund than by each bank
individually. Because only a small
fraction of the assets of a savings
bank may be invested in stocks,
no
one
savings bank can afford
to hire even a minimum staff for

the need of savings banks to earn a higher
Mr. Casazza discusses the means of

on

their assets,

on

increasing income yields through investment in common stocks,
without too much additional risk. Lists as ways to minimize
risk:

(1) proper selection of stock issues; (2) timing of stock
purchases, i.e. "dollar averaging"; and (3) setting aside a
reserve for losses. Points out value and importance of a mutual
fund in eliminating risks

vides

of stock investments and describes
Fund, Inc.

The

chief

confronting

problem

ings bank today is to earn an
adequate return on its assets with
a
high degree
of safety.
Earnings of
a savings bank
be

must

enough to de¬
fray expenses
of

operation,
the

cover

interest-

dividend,
leave

an

and
addi¬

tion to surplus
that
will

margin future
growth.

If

Aiircu
earnings do
not
suffice,
cither the surplus ratio will fall
too low as deposits expand or the
dividend will have to be reduced,
.»

high-grade bonds and mortgages.
Prices of bonds, other than con¬
vertibles,
do
not
usually vary
much from the par value so long
as payment of
interest and prin¬
cipal is considered assured. Prices
of
common
stocks, by contrast,
can rise to any height justified by

which could check

or

banks will want to take measures

minimize

barking

How

posit growth. Either alternative is

There

earnings problem

is

more

difficult of solution for those

ings

banks

Federal

gained

that

have

income

tax

earnings

and. reserves

to

pay

their

on

because

exceed

sav¬

a

re¬

surplus

12%

of

de¬

posit liabilities.
The obvious
solution for this
earnings problem is to acquire
higher yielding assets that do not

entail

undue

risk.

Yield

before

em¬

stocks.

Most

Minimize

to

mize
mon

three

Risk

the

risks

stock

ways

inherent

can

investment objectives

specialized
of

these

conservative investing
will
determine
the

choice and retention of issues

of

time

the

and

in

of man¬

energy

duties in con¬
nection with its stock investing.
and

other

value

While

the

at

time

of

through constan|
and Olose supervision of the port*
folio to shift holdings when called
for by the ever changing condi¬
tions of our dynamic economy.
and

risk

can

be

lessened

The practice of "dollar cost aver¬

fund

mutual

•

tax credit of 85%

a

income. This

makes

on

the

S2%

portfolio after it has been ac¬
quired. Timing and reserves will
not protect the investor against

corporate income tax rate
equivalent to only 7.8% of total

substantial loss if the selection of

dividends

if

received.

A

common

stocks

for

holdings

purchase
are not

is poor,
shifted

and
from

ntpek yielding 4.50% thus gives a time to time into more attractive
havings bank which pavs the 52% stocks in response to changing
income tax a net yield after tax economic conditions.
of 4.15%, which compares with a
I shall deal with this dual prob¬
net yield of only 2.16%
such a lem of common stock selection
hank

would

derive from

a

41/2%

mortgage loan.
Stock Investment Risks
While
f

common

avings banks

stocks

a

Common stocks do not possess a
contractual claim to a fixed rate
return

and

portfolio

supervision

in

my

Solutions to the Selection Problem
offer

higher net rate
of return than any other class of
investments
available
to
them,
they also entail greater risks.

of

and

talk to you today.

to

Savings
problems

banks
of

solve the
selection either
can

through
investing
stocks, or through
mutual

stock

fund

directly
in
setting up a
of

their

own

for this purpose.

There

are

a

of

solid

"in

—

the Savings Banks'

Association
'

of

Connecticut,

Conn., Nov. 16, 1954.




Cheshire,

volves

analysis of the investment

characteristics

and

the

prospects

experience to

its

investing,

list

developments.

new

The

As

List

Approved

are

because

of

of

now,

contains

182

stocks, representing 28 major in¬
dustries.
Inclusion
not

does

of

That

chased.

issue in the list

an

it

mean

will

will

relative

be

pur¬

depend

Approved

upon

prospects.

day,

in¬
initial
25%.
y

shares

and

in

creased

value

have

the

over

over

has been

^

operating

a

and a half, and 69 of the 129
savings banks jn the State
its
shares
with
a
market

year

from

issues

attractiveness

with

compared

other

the

standpoint

by

the

be

List

proposed

adopted

investment adviser must
by the Board of Di¬

rectors.

list

Similarly, changes in the

recortjxpended by the invest¬
adviser

ment

must

be

approved

own

come

$13.5 million. Many

over

these

of

banks

shares in accordance with

averaging
is to

than

more

be

the

of

policy

that

except

10%

of

resources

hot
may

United
States Government obligations to
provide

and

possible

for

shares

of

cash

in

kept

and

redemption

take

to

Funds received by

invested

of

providing
in

investment

medium

a

common

for

stocks

by

savings banks unless it keeps sub¬

stantially fully invested in stocks.
Work

ing

ices

per¬

number of essential

a

passes

serv¬

Institutional

tions

Investors

Fund, Inc.

To

by

Ex¬

all

opera¬

monthly meeting.

flexibility of opera¬
investment adviser is

assure

the

authorized

to

cretion,

to 5% in market value

up

sell, within its dis¬

of the assets held

between meet¬

ings of the Executive Committee.
Such sales must be

reported, with
therefor, to the Exec¬

the reasons

approval.

for

adviser

that

be sold,

the

invest¬

the

If

is

than

more

should

of

the

5%

of

opinion

the assets

special meieting

a

Executive

Committee

is

called.

Banks Trust Company

Savings

reviews

at each

tion,

of

Mutual

The

purchases made by

on

Directors

of

ment

adviser

for

adviser.

Committee at each meet¬

the investment adviser. The Board

ing

Adviser
investment

The

are

utive Committee at its next meet¬

Investment

the

of

Inc.

in the stocks
Approved List

the

investment

ecutive

advantage

exceptional investment oppor¬
The Fund
would not be performing its func¬

tion

promptly
from

Institutional

Fund,

most attractive at the time

the

of

tunities that may arise.

Mutual

Investors

as

be¬

can

effective.

selected

keep fully invested in

stocks,

common

dollar

a

program.

investment

The

Fund

the

buying

are

of

quality, marketability, portfolio
diversification, market price and

by the Board before they

value of

as

approved

mutual

After

has built up a staff of

months

18

of

actual

ex¬

ally trained

houses

date

is in position to tap
worth-while available
information

of

source

and

ideas.

the

by

Trust

research.

office

Savings Banks
to supplement

of
Company,
staff

A

personal con¬
tact is maintained with each cor¬

shares are held
by the • Fund,
and
with some
other
companies
whose
shares
may become attractive for pur¬

poration

chase in the visible future. These

and figures, but are

invaluable in

appraising
quality
ment, which is so

of
manage¬
important in

stock evaluation.

like

Investors

Fund,

Being

in

large,

the

Institu¬

interested

Inc.,

cor¬

Mutual

porations have shown great wil¬
lingness
to impart
information
and plans to its adviser.

registered with and subject to the
regulations of the Securities and
Exchange Commission. Under its

much

by-laws,

the Fund has made it¬
supervision by the
New York State Banking Depart¬

mon

self subject to

vestment. And because the cost is

ment, and submits to periodic ex¬
amination
by
the
Department.

it

of

be

mutual

trustees

or

savings banks

These activities, needless to say,
take

experienced
time.

But

manpower

they

are

and

neces¬

competent job of
selection and supervision of com¬
to

sary

do

stocks for

spread
is

over

savings banks in¬

many

modest

for

this

Moreover,
per

a

The
a

stockholding

board

once

a

elected
of six

of

banks

directors

that

elect
meets

month, and the latter has
an

executive

members

that

committee
meet

semi¬

monthly. A president and vicepresidents have been elected from

Fund

book

The

return

dividends

on

have

tions

on

savings banks,
one bank.

cost

will

decline

share after the Fund expands

in size.

first

been

in the selection

purchase by the Fund

the

Approved

preparation

List

of

an

stocks
con¬
sidered suitable for savings bank
investment. This Approved List
reduces the number of issues kept
under

from

received

by

corpora¬

half the stocks pur¬

over

chased.
The Board of Directors declares

quarterly dividends substantially
equal to the net income of the
Fund.

Connecticut

A

Stock

mutual

The

Connecticut
a

constant

manageable

Common

Fund

banks

savings

of

through

realize

can

stock fund advantages

common

comparable

those that New
banks have derived
Mutual Fund,

to

Institutional

from
Inc.

Such

a

in

ated

fund

your

be

incorpor¬

to

can

state

meet

the
the

requirements of
Connecticut savings banks.

particular
fund

would

trolled

exclusively

and

by

savings

would have its
rectors

owned

be

mutual

cut

own

and

The
con¬

Connecti¬
banks.

board

It

of di¬

who would
lay down and administer invest¬
ment policies they believe suit¬
officers,

able.

the dollar cost aver¬
technique,
each
savings
spread its purchases

Through

aging

could

bank

period of

of the Fund

step

of issues for

has

Fund

Dividends

of the shares

Operation
The

the

increased

been

current

average
to

in¬

basic

the stocks it holds is

5.2%.

about

different

64

19

any

in New York State, or an

organi¬
zation
wholly owned
by these
banks, or an officer of the in¬
vestment company itself.

holds

representing

York savings

Fund, Inc. is an open-end, diver¬
sified,
management
investment
Company
organized under
the
Investment Company Act of 1940,

must

The
stocks

supple¬
ment published information and
help in the interpretation of facts

investors

Directors

which

Fund

ations.

interviews not only

field

stable

Investors

the

of

clear picture of its oper¬

a

whose

tional

Institutional

gives

dustries.

Major emphasis is placed upon
field
investigation and contacts

fied stocks.

,

shareholders

Company
every

common

•

sources.

representative in
district, the Trust

financial

the

other

and

Fund's

the

provides
valuable
guidance to
savings banks in other states con¬
templating investment in diversi¬

officers
number

of
principal at maturity, as do bonds advantages in using a common
stock fund for equity investing
^nd real estate mortgages. They
do not enjoy the legal priority of by savings banks. These include:
creditors. Moreover, common
(1) Provision of a profession/stocks are subject to much greater ally-trained, competent
staff to
risk of price depreciation than are carry out the complex and exact¬
ing job of selecting and supervis¬
*An address by Mr. Casazza before the
ing stock investments. This in¬
Investment Forum of
repayment

the

The

each

As

provided by a
explain why
the

advantages

The

'

given

from

stricken

future

Street

mutual funds.

aging," or the investment of a legislatures of New York and New
hanks, common stocks offer the given dollar amount at regular Jersey have authorized invest¬
highest net yield and so can con¬ intervals for a period of years in ment in shares of an investment
tribute to a solution of the earn¬ common stocks, assures that pur¬
company
owned exclusively by
chases will not be concentrated at
ings problem.
mutual savings banks, as well as
The
average
return
on
200 any one time when prices may direct investment in stocks.
representative common stocks, ac¬ be excessively high.
In the third place, risk can be
cording
to
Moody's
Investors
The Institutional Investors
as
with
f3ervice, is around 4.50%. Since minimized,
mortgage
Mutual Fund, Inc.
corporations in the aggregate pay lending, by setting aside a part of
Sponsored
by
The
Savings
out only about 55% of their earn¬ the current income as a reserve
Banks Association of the State of
ings as dividends, increases in to absorb future depreciation or
New York, Institutional Investors
dividend rates may be anticipated loss.
Mutual Fund, Inc. was incorpor¬
in the future as profits are ex¬
Of these three basic measures
ated under the Stock Corporation
panded by reinvestment of re¬ for minimizing the risks of stock
Law
of New York, and began
tained earnings.
investment, by far the most im¬
operations a year and a half ago.
Dividend income
is attractive portant over the
long run is the
As the first common stock fund
especially to savings banks that proper selection of stocks and the
established by the savings banks
have to pay the Federal corporate continuous
supervision
of
the
of a state to conduct their stock
income tax because corporations
are

or

profession¬
perience, this method of operating
specialists in equity i
the
Fund has
proved
banks the tax and investment ad-,
efficient,
security analysis who sift, digest
while
providing the safeguards
vantages of stocks. Furthermore,^ and
interpret the vast mass of
that should surround
stock
in¬
since the "fund is owned solely by
pertinents
information
coming
vestment
the participating banks, there is
by
mutual
savings
from colorations, statistical
banks. You have received a copy
no
loading charge for sales ex¬
agencies, Government, Wall
of the latest quarterly report to
pense such as is found in other

ments available to mutual savings

dividend

list

value, less V2 of 1%. The net asset

these

providing

energy

issues

the

to

value of the shares is determined

forms

of

banks

clerical

made

its

agement needed for more impor¬

added
First, this can be done through advantages, a common fund con¬
selection of issues that give sound serves
for participating
savings
purchase,

asset

net

and

others. At times, additions are

on

may

current

their

at

burdensome

com¬

$1,000,

avoids waste of time

value, plus % of 1% to cover the
approximate
brokerage cost
of
buying additional stocks for the
portfolio.
Shares
may
be
re¬
deemed
similarly at
net
asset

a

institutions

through timing of stock purchases.

Of the several classes of invest¬

than

(4) A mutual fund owned ex¬
clusively by savings banks pro¬
vides
added assurance that the

investment.

investment

York

The

to mini¬
in

chased

in¬ tant problems of the bank.
(6)
Investment in a
mutual
stock
fund
relieves
individual

of

program

a

common

are

Secondly,
Stocks

degree of diversifica¬
single savings bank
attain in stock investing.

greater

savings

undesirable.
The

upon

vestment in

risk

the

de¬

reverse

provide

(3) A mutual fund can
a

tion

be pur¬
by savings banks of New
at

offered

The Fund

profits and dividends fall. It has the
portfolio.
truthfully been said that there is
(5) By investing in a mutual
neither a ceiling over nor a floor
fund, officers and trustees of sav¬
under common stock prices. This
ings banks will not feel under
greatly enhances the risk of price
pressure
to divert too much of
depreciation and eventualy loss to their time from other major tasks
the
investor
who
buys
when to
managing the relatively small
prices are high.
stock
portfolio. The many risks
Because of the risk that earn¬
attending stock investment and
ings, dividends and prices of com¬ the complexity of this field could
mon
stocks may decline, savings result in taking up a great deal
to

registrar for the Fund.
Shares of
the Fund, initially

of offering price by

custody

handling
physical
investments.

by

and

stock

earnings and dividends, and then
can decline correspondingly when

large

more

a

fund also pro¬
economical way of

mutual

A

ments.

invest¬

sstock

it

of

supervision

the function of the Institutional Investors Mutual

the management of a mutual sav¬

/

ment

City

the savings banks of
New York, to act as investment
adviser, custodian, transfer agent
owned

fect the issues

effectively contacts with company
managements and other worth¬
while
sources
of
pertinent in¬
formation are needed to supple¬

Savings
Trust Company, which is
with

made

been

has

A contract

directors.

the

among

of

appraisal

as

of

surveillance

proportions,

to

and

the

risk

chases at

of the

fund

over

a

of

This would avoid
concentrating pur¬

one

time when common

years.

stock prices may

be unduly high.

Each bank may set aside a reserve
out

of

dividend

income to

offset

possible future market deprecia¬
tion.
The

by

common

stock fund set up

Connecticut

savings

banks

Volume 180

Number 5380

The Commercial and Financial
Chronicle

...

(2159)
could

then

make

qualified

a

perform

Cheap and Easy Money to Continue: Janeway

investment adviser to

the

essential

functions

of

selecting and supervising its
equity investments, and to act as

cus.todian,

registrar

and

these

banks
the

in

sav;n*s

measures,

Connecticut

benefits

of

realize

can

stock

investment,

while

minimizing
risks
and
avoiding undue absorption of the
time and energies of officers
and
trustees

in

the

performance

of

this task.

construction

Money will stay cheap and easy
though aemand for it is

even

to

rise

sharply next spring
inventory borrowers follow

as

long

N. Y. Bank Women (0

term

-

inflationary

state

and

and

top

NEW YORK, N. Y. — "How to
Handle Women" will be the
topic
of
an
address
by Miss PhyUb

Brown,

Editor

in

the

search

InstRute

the

P.?le"se

ex-

told

pert

of

a

of

the

Real

tate

Board

of

York

at

New
Eliot

the

Janeway

on

A. Brady,
a. jsraay

Es-

Yale Club

Nov. 15

Old rules of thumb about busiwia ruies1 or inumo aoout dusicycle behavior are becoming
uspIpss
useless

fnr
fnr

nurnnsps

York.
Mr

Jsnpwflv

wnLmi/.

whn

^r* Janeway> wbo is economic
advlsor to the builders hardware

has spoken before audiences
of businessmen across
the

manufacturers

Business managers,

What I have termed the Defense cycle has interrupted, and
very
possibly
superseded,
tie

30b

supervisors

to

dents,

her

take

questions

country.
ranging from
presi-

company

advice

such

on

pp
how to encourage thp
the

as

discouraged employee, how to
rect

subordinate

a

handle

a

and

cor¬

how

employee.

woman

of her most famous

to

One

reports, "How

to Handle Women" has

proved of

enormous help to supervisors and
personnel directors throughout the

country.
This

be

her

first

.

the

in

As

enter executive
executive

ant

of

and

more

traditional
ness

indus

otner

inaus-

workings of the busi-

cycle.

cycle

Thus,

suspended

the

state

Defense
and

§oyerment public ,W0FS
1941-45
and

last

14.

seven

At

imoact 01
impact of

durin8

years out of the

the

the
me

local

durmg 1950-53

again

total of

—a

noS
po.i-

becoming

is

women

same

Defense
ijeiense

time,
evele
cycie

the

unon

upon

nrabie and
for state and local Public works.
notably reflected in popula ion
th

part of management.

rPiOPation-—L;

d

1

h

fber

upeiauon

Weekly Firm Changes

ca.cn-up

The New York Stock
has announced the

Exchange
following firm

changes:

teaches

and

expect

re-

rowing and construction as the
signal for a general boom to burst
1929.

Rule

Two

teaches

considered

business cycle—via political action

the

L'xchange

will

bershi p

W.

late

the

Allston

L
u.

Benjamin

Barman,
Charles

Flaga'

Jr/

Jr.;

Sievers

to

r°

....

ot

to

Fred

of

and

the

of^the'late
tne late

Jr*
jr.,

Stenzler

of

Berman

.Ll

Stott
2,10x1,

the

of

EHa tz f eld

Bennett'

Robert

^ ^

rx
Robert
en

transfer

0 fL 0 uis

the

to

Thomas

M.

On

and

Dec.

1

Ernest

partners in

George

Richard

Flender,

W.

C.

N.

general

B.

Richard

&

Co.,

^

Four

as

4

into

our
present day
high-speed prosperity.

continued

rise

non-stop,
in

joined

the

1953

into

came

determined

to

even

York Stock

the end of the Korean

annual

Exchange, at the sixth

dirner

the

at

The

New

new

York

members

sures

y*

,

Kushes,
all

of

Marion
The

„

Mrs.

New
C.

Helene

York

City,

Muller

four

G.

of

,

Huddy,

and

Mrs.

Jersey City.
were

firm

and

pres-

decline

with

War.

club

d d

fight

inflation, it found itself

7 "T~+"
forced to fight the
threatened
truce.

to

u-

follow

the

recession,

even

u

which

recession

Korean

The Administration

fighting

anced
All

by

the

"Never

in

Off

to Head

the

history

Federal government has
omy

been

the

th

states

t

t

tax

revenues,

the

in

aggregate

to

borrow

tens-of-billions-of-dollars

on

a

scale,

Our sustained economic boom will

gather momentum with state
ernment

gov-

borrowing, investing and

building.

The states need to bor-

row

and>
therefore, they need
cheap money and lots of its flowjng jnt0 the money market. The
election guarantees
of

1953's

high

with

no recurrence

hard

The combined

and

monev

governments'

expanding

construction boom guarantees

ally

rec-

is still

though

Start

of

our

our econ-

subjected to the

com-

wjth

Electric
about

revenues

follows:

as

"Defense

cycle

traditional

.

conducted an inspection tour o£
its properties for a large group o*
bankers and analysts, in connectries in the area are steel,
rubber, tion with the dedication of th3
machinery, automobiles and parts, big Niles plant.
metal

products, chemicals, pubOhio Edison has been selling
lishing, etc. By far the largest recently around 44V2 to yield
industrial business is in machin-. about 5%.
The current price Lj
and metal products, followed
by iron and steel production, rubber, chemicals and foodstuffs.

ery

An
™

v

abundance

of

natural

about 15 times recent share

,

re-

^ SlllCa,'. m°lding Chicago Analysts
stone, limestone,
and

<=and

f0Und within

gravpl

Montgomery Ward Plant

arp

close by the area.

or

CHICAGO, 111.—A special meet¬
ing of the Investment Analyst*
Society of cnicago will be neu
bociety of Chicago will be heM

prosperous farm economy baN
this

diversified

industrial

fusion

to

Npy* 30 at 12:15 pm* in.the Geo*-

business

management

by

normal sequence

and

mand for construction capital and

short-term demand

for

V

inventory

P,

is

.

of MerritV

Corporation.

Ward

&

Company.

closed meeting

a

,

be
»

made

with

The

Pt,.

Bank of C

Lucian

First

B.

National

nrt.

g

.

One-fourth of the

porl sklPPlnS facilities should increasa

&edway project.

peak in

Scott

meeting is

should

overnight -ship¬
ping distance by truck. Lake Erie

importance

completion

&

Wilkinson.
t,

within

in

Wolfson

for members only and reservations

near
.

services of ten

r
nation

The

and

.

lending by the commercial banks.
Traditionally, demand for cona

Chapman

Pirie Scott

Carson

Montgomery

with all key points
large air terminals in and

major airlines.

Room,

Louis E

are served will discuss the proposed plans for

connect

financial

reversing the
of long-term de-

gian

Co

The area's transportation facilities are excellent. Major railroads
11

to Hear

building

gynsum

earn-

ings of $2.95. which is about th*
average ratio.
•

11

™n

g and 45,209 farm customers
by the System.
of

into operation about

go

gant at Loram companycomptoa
to be recently
*n i9o<.
ine

below the national average; average annual consumption of 2,818
kwh. is substantially above the
national figure.
Principal indus-

from farm marketings and PennsyiVania ranked 14th. A total of

cycle functioning has caused additional con-

ex-

22%, industrial
miscellaneous 5%
Residen"u
K>cendiieuus 0/0. nesiaen . in June of this year for a 90,003
tial rates average about 2.70c per kw. add-tifm tn thp T?df?Pwatpv>
"en idiw avnigc auuut
addition to the Edgewatc*
kwh. per annum, which is slightly

conappli-

distortion

Ft.

R.

is

and

tSrT3

business

212,000 kw»

new

the first of the year and the sec37%| ond in June, 1955. Work began

for

Prccedends to Be Reversed

-

further increase in 1957 to

pected to

derived

are

last

Niles plant, just dedicated, is part
0f thjs program.
Down on th»
ohio River a 270,000 kw. addi-

m

as

the

residential 36%,

.,

automotive and

a

1,790,000 kw. The

£p an<Teasy^ mPnev Iromises 7th in ^ nation 1953 cash ran^efd
PITreceiptscneap
easy money promises Cl the
prosperity for residential

in

business sections of Akron, £jon js being made to the
Youngstown and Springfield,
Burger plant; the first unit

anCes

pressure

sharply

1,448,000 kw. compared with 1,245,000 kw. in 1952 and 1953; iu
1955 it will jump to 1,700,000 kw.,

(168,000), Springfield
e*c. In addition to its
e acln<~ business, Ohio Edison sunPbe.s steam heat in the downtown

on a rising scale A
thereafter. Incident-

gubernatorial

increasing

three years.
Capacity at the end
q£
this
year
will
approximate

? population of about

interest ratesThTc^scendo

and

an increase of
121%
during the post-war period. Construction expenditures have been

have

areas

0f Aug. 31, 1954 Ohio Ed:utility plant was carried at

*452 mini0n

an adjoining
Pennsylvania, ineluding New Castle, Sharon and

ig state
interest rates, ine crescendo sands,

0f

As
son>s

area in western

m-timed and costly ex-

neriment

-

supplies electricity in

commercial

countrv

current

is

owning their own distribution
systems, as well as to two other
electric companies in Ohio. The
subsidiary, Pennsylvania Power,

Congress,,

flock of Demo-

^

continue

must

of

the

witn

St.

tne

Lawrence

Carroll, Kirchner Adds
(Special to The Financial Chronicle)

DENVER,

Colo. — Robert LA
Nelson has become associated wK'ii
Carroll, Kirchner & Jaquith, Ine.>
Patterson Building.
Mr. Nelsca

^aV^rfrmerlv
....

„

securitv

r0burn

&

analyst for
Co

of Boj.*

capital is rising steadily while sidiary, now approximate $109 |
William H. Coburn & Co. of Be,
bank loans have been declining, million a year compared with $75
formal business cycle experience million in 1948. Common si9ck
would
indicate
would indicate that demand for earnings based on outstanding
that demand for earnings based
Joins L. C. Fulenwider
tUA

W

l

lOUlfe

VV111AV.

*

—171

T

„

would

money

follow

shares

have

been

where demand for short-term recent years:
money has been leading. But the
1948__$2.97
reverse is about to

happen.

Be-

their eyes set on past rules instead
of present realities, the
economy
is caught short of inventory in the
face of

record rate of consump-

a

tion.

The

boom,

paced

rising
construction
by state and local

government borrowing, is going to

In

consumption

levels.

As

facturers

to

still

higher

merchants and

race

to

catch

manu-

with

up

de™a"d> they wUl be forced
lndeed' they WlU be anxl0US-t0
go

back

into

ventory

the

banks

for

in¬

money.

"Next year

still
in

see

,.A.

another

(Special to The Financial Chronicle)

1951__$2.60

2.95

1952

1953__

3.15

addition

the

to

stated

Building.

earn-

ings, Ohio Edison charges off
about 190 for amortization of plant
acquisition
adjustments,
which
charge will disappear in a few
Cash

years.

savings

100

other hand there

a

share.

was

credit for interest

a

on

|
p

from

accelerated amortization in
to

1953

On the

substantial

construction

amcunting to 370 a share.
Dividends were paid at the rate of $2
dlJring 1947I51
the rate being
raised

to

$2 20
$2.20

a

new

late

Capitalization
decade

as

in

1952.

ratios have been

|

indicated in the follow-

*n8
comparison
only):

(Ohio

Edison

Because
area

Sept. 30, Aug. 31,

hands

pres¬

public

and

private borrowers guaranteeing an
abundance

money."

of

cheap

abundant

natural

resources,

thiu

by Utoh Power & Light Co., offers
opportunity to industry.

,

political
of

of

served

tremendous

15>44

AREA

1 !)54
P

the

Long Term Debt
Preferred

'

ley has become connected with
C.
Fulenwider,
Inc.,
Equitably

2.97

2.98

substantially improved in the last |

will also

beginning made of continental de^
fense planning, and this will pro-

sure

in

DENVER, Colo.—John L. Wheals

1950__

amounted
spur

follows

as

2949

cau.se production and merchandising managements have kept

vide

Inflation

of

up ana aown me country, state

But

by

chairman. Their admission
brought
the club's total
membership to 36.




in

recovery is resuming.

senior partner

permanent

to

pre¬

sented with go'd wrist watches

the

inflationary

due

were

®

members

Marcus Goodbody,
of

■

though

office

directly the Administration began
to

Andrew Keller, Miss Jean F.

are:

de¬

stop inflation

garter ^Century ^Club^of^ Ggodbody & Co., members of the New
Athletic Club.

the

help'ng to
clarify the real nature of Wash¬
ington's fiscal problem. This Ad¬
ministration

a

of

governments speuuiiig on capuai
capital
governments spending
account bulks to large to be fi-

long_term

&

sharp cyclical turn down or
in the past, is simply built

"The

Century Club

members

new

^

today, non-Federal
activity, instead of being a signal
a

return

Governors.

Pennsylvania Power Company has
46% debt, 19% preferred stock,
and 35% common equity (as compared with 27% 10 years earlier).

as

inventory borrowing. Today, howEdison s revenues, includ
rising ever> demand for construction ing those of the Pennsylvania sub-

Thus

up,

the

is the election of
cratic

'hard

important for the
politics on the money

than

well

Power

govern-

mand of non-Federal governments
for long-term money is

Goodbody & Co. Adds

market

Ohio.

also sold at wholesale to 24 municipalities and seven rural co-ops

struction capital follows

rpppssinn

basis.

/will become limited partners.

To Quarter

non-

ments'demand for money is
steadily and heathily, and a new
business recovery is starting too.
Meanwhile, the economy as a
/
whole is in high gear and moving

lor

Evans.
;

nnH

"But today non-Federal

A.

late

that

spending v/ill also come
into play at another phase in the

date the Exchange

same

consider

m em

on

expect

Federal

tn

On the

to

by

o

to

us

against

More

of

Democrats to control

Rule

boom

a

Transfer of the Exchange mem¬
of
the
late
Carroll
V.
Geran to Oscar R. Foster will be
rtoo

money.'

insurmountable

is

in non-Federal public service bor-

—remember

bership

barrier

public

resumes.

to

us

an

in

1,813,000,
Lscal pol-„ ^luomg the important cities of
politically Akron (374,000), Lorain (51,000),
any

significant result of the 1954 elec-

effect

areas)

Farrell.

expect, however,

fy agricuRu^ra^wellFe
agriculture
well.

in

borrowing-to-build

ends

covery

non-Federal

return of anti-infiation
jcy in Washington.
A

struction,

breaking the old rules of how
One

a«3

standards.

service

New York Stock
ExHbange

wpII

^location as well as

v

The■

import-

an

do not

unpreCTdented'toand ord1955
unprecedented demand

and

banking business, the

question of how to handle

employees

other

ana

*

address

audience

an

women^nter

more women

tions

and

manuiacxurers

?UL ef0I?0rn.y "01urAn? tyiS H-year

wi'l

the subject to
business women

on

«i

ness

inrrpa«in*lv
increasinelv

and

influ-

against it.

alarm

political

Committee

combined

Federal

tion introduces

announced

Miss Brown, an
expert in probof human
/ relations on
the

of

Mortgage

York group of the Na¬
tional Association of Bank
Women
to be held on
Tuesday, Nov. 30 at
the
Advertising Club, 23 Park
Avenue, New York City, it was

lems

the

under

lreeting of the

ton-New

recently by Miss Eliz¬
Group cnairman
uroup. Chairman
and
Assistant: Treasurer of the
Bankers
Trust
rm™*™
Bankers
Pomnanv
Trust
Npw
Company,
New

m0""

bilization

Re¬

net

of

deficit financing, inflation will be
off to a head start over the next

economist and

America, at a
dinner meeting of the
Metropoli-

abeth
aoein

Eliot

Janeway,

Associate

of

ence

mar-

of

spending
high Federal
This spells inflation. In

on

deficits.

the

ket,'

pressure

governmenfnet

borrowing

money

Meeting

local

loaded

1955,

electricity

(as

bined

into

Membership Division

Ohio Edison Company
Ohio Edison supplies
to 577 communities

money.

borrowers

Utility Securities
By OWEN ELY

rural

"due

Hold Dinner

Public

Economist, maintaining traditional course of business cycle
been superseded by "Defense
Cycle" and "Operation
Calch-Up" in public service borrowing-to-build, predicts heavy
demand for long-term money, to be
unaccompanied by rise in
borrowing rates. Foresees next year's continental defense
planning providing another political pressure for cheap
has

transfer

agent.

By

23

contract with

a

Stock

Common Stock Equity—

61%

43%

18

18

21

39

construction

RESOURCES BOOKtET

O. Box 899,

on

request

Dept AA, Salt lake City 10, Utah

UTAH
POWER A LiGHT CO.

100%

100%

24

The Commercial and Financial Chronicle

(2160)

Nov.

in

17

Lawrence
the

of

ment

R.

Hafstad, Di¬
Develop¬

Reactor

Division

the

of

Atomic

1929.

in

Chase

was

York,

Jan.

on

Bank

1,

next

of

New

Atomic

as

Energy Consultant, John J.
Cloy,
Chase
Chairman
of
Bank

is

announced

planned

that

the

19.

Hafstad

Dr.

Chase

represent

Nov.

on

Mc-

in

It

will

conferring

with various groups

In

1942, after working in
departments, Mr.
Petry

various

Energy Commission in Washing¬
ton, will join the staff of hie
National

of the two institutions in

merger

special assignment
the president's department. He
placed

was

on

advanced to Assistant Secre¬

tary in 1947 and Assistant Auditor
in

March,

Mr.

1954.

is

Petry

Cranmore

director of

to

will be informed of

shares

of

approximately

400,000

convertible

cumulative

preferred stock through transfer¬
able

provide ap¬
The plan

to

warrants,

proximately $20,000,000.
will

subrhitted

be

them

to

at

a

special meeting of stockholders to
be held in Buffalo on Dec. 29.
If

a

Skimobiles,

Inc.,
the
Eastern
Slope
Hotel
Corporation, Eastern Slope Ski
School, Inc., etc.
*

the

a

scribe
Dr.

Presently

special advices sched¬
uled for Dec. 6.
It is proposed
to offer them the right to sub¬

details in

CAPITALIZATIONS

rector

23.

the

plan

additional
would

stock

of

conversion

and

for other

needed

as

the

of

preferred

corporate purposes,

*

*

by the bank's industrial custo¬
mers," Mr. McCloy said, "and will

and the proceeds of the preferred
the trend of financial would be available for investment
in additional capital stock of the
institutions moving into the midtown
Fifth
Avenue
area,
The corporation's subsidiary banks and
Royal State Bank of New York for other corporate purposes.
In
announces on Nov. 22 that it has
commenting on the proposed fi¬

devote

taken

planning the
development of atomic energy by
private
industry.
"Dr.
Hafstad
will

be

available

his

for

efforts

consultation

exclusively

to
of

Joining

three

over

floors

the

of

nancing,

Charles

Diefendorf,

H.

furthering the peacetime uses
atomic 'energy, in line with the
objectives
of
President
Eisen¬

sky-scraper building at 245 Fifth

President of Marine Midland Cor¬

Ave., at 28th St., under a 20-year
lease, for its new principal and

poration, said:

hower

executive offices.

and

his

Administration."

Dr.

Hafstad, a
leading
atomic
energy scientist, is a graduate of
the University of Minnesota and
Johns

Hopkins

which

he

University,

received

his

from

Ph.D.

in

1933. He was a physicist for the
Carnegie Institution of Washing¬

ton

from

1927

Director

was

Applied

to

of

1945

later

and

Research

the

of

Physics

Laboratory of
John Hopkins University at Silver
Spring, Md.
He

appointed
Executive
Secretary of the Research and
Development Board, Office of the
was

Henry G. Bar¬
ber, President and Chairman of
the Board, reported that the in¬
stitution plans to move into the
expanded quarters about Dec. 15,
following extensive reconstruction

nearly three times the
necessitated

by the substan¬

tial

increase

the

the

mission
the
an

in

Development Divi¬
Energy Com¬

Atomic
1949.

Dr. Hafstad

was

recipient, with M. A. Tuve, of
American

Association

for

the

in

institution's

business,
which
witnessed
the
growth of its deposits from $10,036,000 on Dec. 31, 1950, to $30,155,000 at the beginning of 1954.

tains

sion of

space pres¬

was

until he

of the Reactor

Barber de¬
quarters

into

move

ently occupied at 1134 Broadway

The

named first director

the

clared

Secretary of Defense, in- 1947,
continuing
in
that
assignment
was

Mr.

underway.

now

bank

services

approximately
17,000 depositors. The bank main¬
branches

two

326

at

—

E.

149th St., the Bronx, and the Bel¬
mont Office
at
Arthur
Avenue
and

187th

East

the

The

Fifth Ave.

of

corner

St.

to

move

location at the southeast

new

and

28th

St.

Advancement of Science award in- will take place about six months
after the name of the 30-year-old
1931 for research
and develop¬
institution was changed from the
ment of the 1,000,000-volt vacuum
tube.

In

1946

Medal

of

Merit

he

tary of the Navy
contribution

of

in

the

Secre¬

the

for his

Royal

"major

the

development
improvements in

significant

ordnance for the Army and Navy."
*

*

as

Vice-President

a

Edmund Leone

Remand

of

Comptroller of
Manufacturers Trust Company of
New

York,

Nov.

19

President

Mr.

of

in

the

State

announced

Horace

Flanigan,

his

banking
1924, with

December,
and

Trust

Com¬

which merged with Manu¬
facturers Trust Company in Janu¬
pany

1929.

ary,

In July, 1945, he was
Assistant Comptroller.

appointed
Mr.

Remmell

will

be

Co-ordinator

of

offices.

Operations

Leone

Mr.

the

bank's

joined

Bank

Bank

of

the

to

York.

New

is

the

tion

expected

served by

fine,

Executive

and

Vice-President
director, and other senior

a

be

the Mezzanine

on

Floor, overlooking both Fifth Ave.
and
the
public
space
on
the
ground level. Adjacent to the ex¬
ecutive

suites

will

be

the

of the secretariat and

erational
Mr.
York

when

increase

personnel

System

of

in

His

became

New

the

a

Federal

York

Second

bank

career

began

Senior

Audi¬

Reserve

following

Bank

service

Lieutenant in World

War I.

in

1945.

voted

Cashier,

re¬

July, 1949,

tional

Mr. Leone is

uate of New York

received

his

he

made

was

was

Subsequently,

Executive

when

this

Vice-

institution

merged with the Melrose Na¬
Bank

to

become

the

Na¬

by the Internal Revenue Depart¬
ment, the amended provisions will
become

effective

N.

Y.,

tution

the

Executive

tional

is

member of

a

Committee,

Association

of

Bank

Na¬
Audi¬

tors and

Comptrollers, New York
Chapter; he is a past President
and at, present a member of the

Board of Governors of the Esquire
Credit Club.
On

the

Nov.

24

announcement

appointment of Edward G.
as Auditor at Manufacturers

Trust

by

President

trust
the

Company
company.

State

pany

in

Bank

1921

announced

was

Flanigan, of the
Mr Petry joined
and

and

Trust

went

to

Com¬
Manu¬

facturers Trust at the time of the




the

is

until

was

Manufacturers

tional
come

a

merged
Trust

ca¬

with

Co.

He

in

this

Bronx

bank's

Bank

President

of

four

offices
the

Na¬

to

be¬

Royal In¬

July 10, 1950.

on

*

*

*

*

thorized

capital

Corporation

stock

of
of

Marine

Buffalo,

announced

lative

vajue

common

was

B.

Stein

19, Leo
appointed Assistant

was

Secretary

and

at

a

Manager

of

Coney Island branch of the bank.
Mr.

Stein

entered

Dime"

served

in

the

in

employ of

1929.

various

He' has

capacities

in

the Bensonhurst and Coney Island
branches including those of As¬

sistant Manager and Acting Man¬
ager.
Since the opening of the

Coney
total

Island
of

have

branch

in 1950, a
depositors today
than
$24,000,000 on

16,957

more

of

Stein

is

also

Presi¬

Coney Island Board
*

A

*

County

sau

National

Bank

of

Rockville Centre, New York, and
The Franklin National Bank
of
Franklin Square, N. Y., under the
and charter of the Frank¬

held

cor¬

on

Mr.
attorney at Rock¬

is

an

and

National

has

the

with

Nassau

Bank

as

dent and director

been

National,

Taylor

,

and

jointly

was

Nov.

on

18

an¬

by Ralph W.

Arthur

T.

Roth,

Presidents of their respective in¬
stitutions.
The
Office
of
the

Comptroller of the Currency has
given preliminary approval sub¬
ject to the approval of the share¬
holders

the

of

National Bank.
tion

will

are

have

Nassau

The
total

$300,000,000.

County

new

institu¬

resources

The

of

resources

Nassau

County National Bank
$30,000,000 and those of The

Franklin

National

$275,000,000.

The

Bank

are

Nassau

ren

A.

Schneider

Vice-President

in

will

charge

become

of

the

of

title

The

Allentown.

of

bank

National

First

the

with

starts

$10

The

and

to open on

A

bank

has

also

was

the

First

Nov.

capital

of

3,
the

Bank

of

$500,000

to

National

Ohio,

a

founders

from
♦

*

•

*

The American National Bank of

its

capital
to

dend

as

Ind., has increased
of Nov. 8 from $200,-

$250,000, by

of

stock divi¬

a

$50,000.
*

National

*

*

Under date of Nov. 4 the Elgin
*

Stockholders
National

*

of

Bank

National

the

Fort

Neck

Seaford,

at

N.

Y., at
authorized

Long

special meet¬

a

issue

and

sale

$150,000,

26,000 shares
capital
stock
to

of

record

Nov.

16; price
Subscription war¬

will

rants

expire Dec. 7 (EST).
offering to stockholders will

underwritten

Blair & Co.

by

main

office

at

Seaford,
Lond
Island, and a branch in
Wantagh and a branch in Massapequa.
The bank has received
permission from the Comptroller

Currency to open a branch
Massapequa Park.
It is ex¬

pected

that

such

branch

will

of

Elgin, 111.,

a result
$25,000.

as

dividend of

*

*

two-for-one

a

of

additional

holders

Bank

en^

larged its capital from $125,000 to

split in the capital stock and the

be

dividend,

effective

the

enlarged

Coun¬

as

County

*

of

*

stock

became

Alliance

scheduled

was

*

$100,000

which

Bank.

ing

consoli¬

$600,000.

well

of

the

Nov. 8.
*

Alliance,

and

one

Nassau

of

be located at the

St., Allentown, Pa. The

consolidated

000

the

of $4,-

present main office of the Allen¬
town
National
Bank, at
11-15
North 7th

the past

director

200,(par

stock

surplus

office

main

Noblesville,

of

stock

into

common

dated bank will

Judge Hooley, now Official
Referee, served as Judge of the
Supreme Court in the district for
years

capital

a

000,000 and undivided profits and
reserves of not less than $560,000.

sel.

17

Bank

consolidated

divided

$2,000,000

Vice-Presi¬

a

as

asso¬

of the Sec¬

5, under the charter

ond National Bank and under the

County

of

stock

a

*

The

majority stock interest in
Security
National Bank off

the

acquired by

Cairo, 111., has been

Barney Fisher, President of Bar¬

and Associates, St.
nationally known
paper

Fisher

ney

Louis,
mill

agents, it was announced at

Louis

St.

will

on

Nov. 15.

Mr.

Fisher

direct the bank's
management
as
President
and
Chairman of the Board. Security
actively

National, the only National bank
in
Cairo, has deposits
totaling
$5,000,000 and servies an area ex¬
tending as far as Cape Girardeau,
Mo., and Paducah, Ky. In disclos¬

be

ing plans for the bank, Mr. Fisher

early in 1955.
Previous
items
regarding the
bank
ap¬
peared in our issues of Nov. 4, pp.

expressed the view that the Cairo

opened

1847

and

1865;

and Nov.

18,

Nov.

page

*

11,
2070.

*

the

increase

to

First National

$62,500 has
capital of

Bank

of

Cort¬

land, N. Y., from $637,500 to $700,000, the new capital having be¬
effective

come

Nov.

*

*

of

the

Bank

Hartford

Connecticut

tional

Bank

capital

Trust

&

with

the

&

River

Company

Hartford

Trust

$7,050,000.

of

Na¬

Company,

Each

other two banks had

of

the

capital of
$500,000 each. At the effective date
a

of the

opening of the consolidated
on

Hartford

Nov.

Company

the

1,

National

the

bank

Fisher

enlarged

Bank

&

Trust

(the consolidation

was

effected under that bank's charter

was

from

Swisshelm

and

The

main office

cut

River

known

as

Connecti¬

of the

Banking

Co.

is

to

be

the "Connecticut River

Branch" of the Hartford National
Bank

ing

& Trust Co.

on

peared
page

An

item bear¬

the proposed merger ap¬
in

our

issue

of

Oct.

21,

1606.

purchased by Mr.
C. Carter, U. A.
Harold S. Weber,

which

Present

in

National'
Execu¬

Security

tive

and

Vice-President,

C.

R.

Meisenheimer, Cashier—will con¬
tinue
to
serve.
In
serving the
bank, Mr. Fisher will also main¬
tain
his
activity in connection
with
other
business
interests

addition to
include:

which, in
mill

agency,

the paper
President,

Warehouse

Chesterfield

Co.,
in

public
warehousing
Missouri
and
Illinois; owner

bonded

real

of

in St. Louis

holdings

estate

County;
member,
President's
Council, American Manufacturers'
Institute,
and
member,
Master
Brewers' Association of America.
*

*

*

The

Bank of

The

of

directors

Detroit, Mich., at

Detroit
a

meet¬

ing held Nov. 16, declared a quar¬
terly dividend of 50 cents a share
on

the

ital
Dec.

$10

the

of

22, to

or

shareholders
1954.

value common cap¬

par

stock

This

an

payable

the order of

record

of

is

bank,

upon

Nov.

increase

in

30,
the

annual rate from $1.80 per share
to

$2.00

per

share. The board also

authorized the transfer of $2,000,000 from undivided profits to sur¬

*

*

*

plus, effective the
stock

institu¬

established

was

officers—William Eichoff,

Through the sale of $100,000 of
new

families

of Cairo

representatives

and title) had a

capital of $8,800,000, divided into 880,000 shares of
common stock, par $10 each; sur¬
plus of $10,200,000 and undivided
profits of not less than $4,000,000.

C.

related to founders of the

1933.

*

A banking consolidation com¬
bining three banking institutions
in
Hartford,
Conn.,
has
been
brought about as a result of the
union

The

tion,

5.

the

of

in the immediate fu¬
controlling interest in

expansion

the

confluence

the

at

area,

Mississippi and Ohio Rivers, will
be the center of great economic
ture.

A stock dividend of
served

1970

p.

*

bank

name

$1,000,000,
the
consolidation
having been effected as of Nov.

stockholders

annual

Centre

ciated

elers

*

proposed merger of the Nas¬

offices will be retained and War¬

meeting

its

at

meeting in January of 1955.

Banking Company and the Trav¬

Trade.

by

par

Bank

of

of

directors of the Franklin National

the

approved

the board of directors of the

poration

a

of

10,000,00(0

stock

at

shares

cumu¬

preferred stock of $50
and

that

County
National Bank has three offices,
located
at
Rockville
Centre,
Roosevelt, and Uniondale. These

Y., to 500,000 shares of

growth,

in

"The Dime" held Nov.

of
au¬

♦

of

over

*

proposal to increase the

Midland
N.

similar

Vice-President

as

dustrial Bank

A

in

Bronx

resigned
charge of

of

Petry

31,

meeting of the board of trustees

lin

Bar in

He

Dec.

George C. Johnson, President of
lyn,

nounced

pacity, remaining with the insti¬

1934.

of

as

The Dime Savings Bank of Brook¬

Sterling National Bank as VicePresident, then returned to the
National

Bank, which is one of
leading
banks
in
earnings
and
service."
William
J.
Sullivan
and Judge
Francis G. Hooley are to become
nation's

the

of the
*

tional Bronx Bank. He joined the

degree from St.
Lawrence University in 1930, and
was
admitted to the New York

National

its

grad¬

a

Franklin

has

University and

law

The

holders meeting on Dec. 29, and if
approved by the stockholders and

Vice-President and Cashier of the
Bank.

with

Bank

The Fort Neck National Bank

of

Assistant

an

tional

Inc.

the

as

negotiations which will result in
the merger of Nassau County Na¬

special stock¬

Mr.

appointed Auditor

the

at

the

President

was

started

was

This matter will also be

upon

dent

merger in June, 1928.
appointed an Assistant
Vice-President in
1947
and
in

of the bank.

plan

the

in

of Al¬

stock

$450,000 and the Allentown Na¬
tional Bank, with common stock

each),

participant

a

Bank

common

value

been

have

The

the

with

lentown,

of

$20 per share.

since

deposit.

a

Midland

Second National

the

taken

Pa., between

place in Allentown,

000 shares

ation

Bank

was

to

Retirement

Marine

the

Later, he joined the Cos¬
mopolitan Bank and the Colonial

Port Morris

through

the

under

of

benefits

c

*

♦

A bank consolidation has

announcing his forthcoming re¬
tirement said,
"I am happy to

Island,

the

capital, effective Nov. 5, from
$200,000 to $300,000.

of

Banks for the purpose of meeting
the changes in the economic situ¬

"The

1950.

he

tor

a

op¬

Barber, active in the New
banking field for 40 years,

July,

as

general

staffs.

named President of the

was

in

offices

with

He

posi¬
growth that
in the areas

the banks."

111

Trust

eco¬

The directors of the corporation
also approved a proposal which
would

Ralph W. Taylor, President of the
County National Bank, in

its

Nassau

excellent

the

support

be

may

in

banks

to

signing from the latter to become

Manufacturers

keep

1954.

Capitol National Bank in March,
1924, and he became associated
the

Marine

to

nomic
which will un¬
progress
questionably be accelerated
by
such
developments
as
the
St.
Lawrence Seaway and Power
Projects and the New York State
Thruway.
Approval of this fi¬
nancing plan will put the Marine

Midland

give The Franklin National Bank
two offices at Rockville Centre.

ville

of

purpose

management

also

respective managers, Kenneth
Soberg and Charles J. Horchler,
Jr. The present South Shore of¬
fice
of
The
Franklin
National
Bank at Rockville Centre will be
retained
as
another
Rockville
Centre office under the direction
of
Frank
W.
Breitbach,
VicePresident and director. This will

Sullivan

with New York State's

pace

The private executive offices of
Mr. Barber,
and William Gold-

company.

began

Bank

on

C.

trust

the

Remmell

career

as

was

by

State

officers will

*

Appointment of Paul A.
mell

Industrial

Royal

received

from

"It

Midland

Unioncontinue
of
their

direction

the

common

issued

be

for

the

approved,

is

shares

Rockville

office,

will

offices

under

Nov.

on

Stockholders

Bankers

and

REVISED

Plaza

Station

Centre. The Roosevelt and
dale

corporation is authorized to issue
up to 8,000,000 shares of common.

BRANCHES

OFFICERS, ETC.

The

preferred

tion

CONSOLIDATIONS
NEW

City.

stock has been called for redemp¬

News About Banks
NEW

York

New

outstanding

currently

Thursday, November 25,1954

...

the

Marine

National

Bank of Wildwood. N. J., increased

*

*

same

date.

*

Under date of Nov. 15 the stock¬
holders

nf

The

Bank

of Asheville

Number 5380

Volume 180

at Asheville, N. C.,

vised

...

The Commercial and Financial Chronicle

eott

Philip S. Fogg, Chairman of the

have been ad¬

by President Philip Woollthat
in keeping with au¬

Board

solidated

tion,

Engineering

ment

increasing the outstanding shares

Chairman

from 20,000

directors.

therewith

ance

the

of

to 22,500.

have

bank

subscribe to

of

shares

date

for

The

of

will have
Dec.
15, 1954, to exercise
rights
to
purchase
new
Stockholders

surplus.
until
their

shares, and such

rights will ex¬
pire on that date. In view of the
underwriting referred to below,
payment for shares subscribed to
must
be
received by the
bank
no

later than Dec. 15.

that

the

resolution

It it stated

of

while

the

stock¬

of

board

Fogg,

Mr.

1937,

Professor

a

Wallace,

M.

bank's

of the

Institute

announce¬

an

George
In

California

at

of

firm

eight

that date.

on

by

Angeles,

Los

Calif., according to

one new

each

of

Bank

Corpora¬

been elected
Security-First

the

of

Technology, became
of a small engineering

Treasurer

the stock is $25.00 per
share,
of
which
$10
will
be
credited
to
capital and $15 to
price

National

13,
right to

purchase

an

stock

owned

Nov.

the

offered

been

share

stockholders

the
of

as

In accord¬

director

a

has

Pasadena,

previously given by the
stockholders, the directors of the
bank at a recent meeting voted
to
issue 2,500
additional shares
of capital stock of $10 par value,
thority

Con¬

President of the

and

pioneering in the frontier of
Today he heads the firm,
Consolidated
Engineering

science.
The

Corporation,
aries:

subsidi¬

Consolidated

the

three

Vacuum

and

Corporation
CEC

N.

Rochester,

of

Calif., and Electro Data Corpora¬
tion, Pasadena.
The parent or¬
ganization has a modern plant at
300
North
Sierra
Madre
Villa,
Sales

last

were

year

$14,000,000. Born in Michigan, Mr.
Fogg first entered the business
world
came

statistician, later be¬
investment analyst, then

as
an

Professor at California Institute

a

in

of Technology. From 1947 to

that
be

fractional

no

issued.

whose

whole

to

by eight,

the

next

do not

may

higher

shares.

of

number

scriptions

to

number of shares

divided

be

subscribe

are

stockholders

Those

present

cannot

shares

Sub¬

have to be for

the full number of shares to which
stockholder is

a

be for any

entitled, but ma/
part thereof.

Beane

have
the

agreed

bank

to

purchase

at

$25 per share
shares not subscribed for by

any

stockholders

their

under

rights,

and will distribute such shares to

the

public.

The

2,500 shares at
$25 per share will produce $62,500,
of which $25,000 will go to the
capital account, increasing it from
$200,000 to $225,000, and $37,500
will go to the surplus account.
The directors also voted to trans¬
fer

$37,500

the

from

undivided

profits account to the surplus ac¬
count, making the surplus account
$275,000; so that the total capital
and surplus, after the new stock
is issued, will be $500,000. At the
same
meeting, the directors de¬
clared
the
regular semi-annual
dividend of 3% and
dend

of

15 to

2%,

both

a

special divi¬

payable

Dec.

stockholders of record Nov.
*

Fulton

Ga.,

*

board

of

*

National Bank

announces

of

of Atlanta,

of Nov.

as

The

the

11

following promotions in its official
staff: Erie Cocke, Vice-Chairman
of

the

board

Chairman

of

of the

directors

and

Executive Com¬

mittee; William V. Crowley, Pres¬
ident; Gordon Jones, Executive
Vice-President and Carl M. Floyd,
Senior Vice-President.
H

*

*

The

Republic National Bank of

Dallas,

Texas,

has

the

banking

new

set

Dec.

1

office

and

building at Pacific Avenue and
Ervay Street, and the time as
10:30

a.m.

There will be

special

a

entertainment

V

As

The

El

Paso

National

recently announced in
columns,
(Nov.
11, page
the increase in the capital

1961)

of

successfully

a

result

stock

to the

9

An addition of

a

$1,000,000 stock

dividend to the capital of the First

Security

Bank

Association,

of

of

Utah,

Ogden,

raised the bank's

National
Utah,

has

capital, effective

Nov. 4, from $4,000,000 to $5,000,000.




sale
of

of

Bank

By H. E. JOHNSON

This

of
One

Calif.;

Bank,

National

Calif.;

First

Bellflower,
Bank

of

First

Santa

Calif.;

Crows

Calif.;

Bank

Landing,

of

Bank

National

into,

Calif.;

Los

Weed,

of

San

Trust

Calif.;

and

First

9

Calif.;

of San

Trust and

However,
two

Jac¬

Bank

San

for

Trust

Company

State

23

by

special

a

and

of

a plan
Western

First

National

California which

sidiaries

of

Nov. 17 ratified

on

acquisition

of
in

and

Francisco, Calif., at

meeting

are

banks

now

15

of

to

29.

Nov.

on

and

50

17

the

Transamerica

23

banks

pre¬

viously approved the transaction,
according to T.
man

of the
First

P.

Board

Coats,

Chair¬

First

of

West¬

Western's shareholders

at the meeting also approved
a
change in the bank's by-laws to
provide for an increase in the
number

of

directors

serving

its board from 15 to 21.
directors

elected

since

the

on

cents payable

The

on

new

the

at

meeting
were: Fred Forgy, business execu¬
tive of Santa Ana, Calif.; Warren
A.
Harlan, Long Beach, Calif.,
banker; Mervyn Hope, President
Hollywood Savings & Loan
Association, Hollywood; and J. A.
business

Barbara

executive.

1953

of

the

inde¬

23

pendent banks with First Western
will

the second

create

bank

deposits.

bank

will

in

the

The

amount

have total

state-wide

state-wide
of

resources

approximately three quarters of
billion

dollars

55

and

and

banking

offices scattered through the State
Pasadena in
the south
to
in

the

the

north.

big

new

Management

banking

board

of

is

Rudolph

Chairman

executive

years

withhold

The

and

committee

and

action

in

the

on

consummation

final

transaction

the

Verdeling is
Coats pointed out

that

is

subject

to

The

banks

involved

Bank

Moorpark,

15.9%

increasing almost

the

change

real

Thcs

the

was

lowest

$56,462,000

from

the

for

October

reported.

was

month

any

$68,551,000 shown in October,
of $64,087,000

reported for

year.

the past threes-

issues

Nov.

18,

Nov.

of

page

S.

Francisco

merly), effective
announced

was

Bank

15

1924.

to join the
Nevada

of

First

main

He is

has

in

period of

in

Assistant

an

(head

office

was

To¬

announced over the

end,

Mr. McLean

a

director

of

is

Packers, Ltd.

Canadian

eral
sor

Y.—Charles

N.

bership

Calif.;

the

Exchange, and
come

a

New
on

partner

H.

a

mem¬

York

Stock

Dec. 2 will be¬

in

Vietor,

Com¬

$903,400

decline

$784,953

of $26,456,000

about

or

3.5%

from

It is interesting to note, however, that all

attributable

to

the

figures

lower

for

August

less

Providing

the total very materially for

fact for August of 1954

than

a

year

earlier

losses totaled $78,163,000,

slightly

or

more

than the

for the first 10 months.

present trends

continue

and

there

are

no

catas¬

trophes or large fires, losses for the full year 1954 will be less

*

;

unusual figure for October is not expected

cated in the final two months.

losses

fire

and

normally

rise

at this

members of the

New

time

of

year

so

that the

final months may approach loss totals close to those of last year.

the full year the total fire losses

for

Thus

million

or

somewhat below the record

may

total

ported in 1953.

of

be around $875
$903 million re¬

'

;

J. J. B. Hilliard to Admit
Hilliard

New

Street,

York

and

York Stock

BANK

Ky.—On Dec. 2
419 West

& Son,

and

members of the
Midwest

INSURANCE

Stock

Exchanges, will admit to partner¬
ship Watson B. Dabney and John
H. Stites, Jr.

STOCKS

Strauss, Phillips Branch

Laird, Bisseil & Meeds

Strauss,
bers

of

the

Phillips
New

&

Co.,

mem¬

York Stock Ex¬

change, have opened a branch of¬
at 120 Broadway, New York

City, under the management of
Sidney H. Strauss, resident part¬
ner.

,

to be dupli-

Actually this is the heating season

fice

Dann & Co., Ellicott Square,

Exchange.

74,127

losses for the first 10 months of the current

difference in the two years

J. J. B.

Worthington to Firm

BUFFALO,

mon,

65,129

83,440

1953.
is

In

LOUISVILLE,

Ltd.

Vietor, Common, Dann to

in

$645,697

68,064

_

a

decline

$29,550,000

Jefferson

Admit

$751,898

__

Gen¬

Investments, Ltd. and Wind¬
Court Apartments,

Worthington will acquire

the

$725,440

__

approaching $50 million increased

Vice-

Canadian Bank

President of Canada
and

63,953

than 1953.

Commerce,

week

68,551

this

First National Bank of

director of The

past

57,668

banking

W. F. McLean has been elected

ronto) it

58,949

August of 1953 the General Motors fire at Livonia with losses

San

native of Oak¬

a

showed

The

of

56,462

68,613

of

President.

a

107,713

In

office

been

_

be seen,

year

Western

He left his San Fran-

as

61,675

78,163

months

Year__
can

that month.

since

58,585

74,938

by T. P.

charge of commercial loans at

and

67,644

;T

64,087
__

same

land,

62,354

65,533

for¬

Mr. Turek will be

Vice-President

Francisco.

64,239

December—

Coats, Chairman of the Board of

bank's

67,380

62,282

_____

Ten

immediately, it

Nov.

First Western.

the

72,254

67,362

69,532

November

As

in

83,471

77,933

_

i

Turek, Vice-Presi¬

(Reno) will join the First

San

84,821

__

_

September.

Western Bank and Trust Company

(The

69,925

__

August

dent of the First National Bank of
Nevada

72,706

__

__

October

Rudolph

$74,155

July

2048.

1952

$76,659

78,928

June

11, page 1961 and

1953

195-1

$86,493

_

May

Bank & Trust Co. appeared in our

the

follow:

of

when

1952

April-__

Previous items

ap¬

American Commercial and Sav¬

ings

5

corresponding period of

years

lower than the figure

March__

First ^Western

of

in

the

significant in another respect.

also

February

early

year.

the

proval of State, and Federal bank¬
ing authorities.
transaction

yet

as

shown below.

are

establishing

the

new

concerning

Henry

Mr.

are

be.

now

has

$57,668,000

January

Nov. 17 it would

on

the

of

several

past

Month

board decided

A.

of

Vice-Chairman

storms

dividends
year.

system

unchanged, Mr. Coats

directors;

of

10%

a

from

of

the

by the National Board of Fire Underwriters for

share the

of

paid by the bank this

State, based

new

from

com-r

may

Figures of estimated fire losses in the United States prepared

Dec.

will rank First Western the fourth
fifth

below

were

were

to

down

were

banking system in California and
or

the

September of this

cicso Bay area banking job in 1948

Consolidation

individual

is realized that losses have been

for

August

losses

of the

Santa

losses

amounting

Corpo¬

had

the

Some

that the final figures

so

com¬

this, it is encouraging to review what has been

October losses
total

share have been paid this
year,

a

the

of

Significance.

stockholders of record Nov.

bring to $2.30

many

*'

which

When it

1953.

Previously, dividends of $1.80
that the 50

and

the

Early

sizable underwriting losses for

still being received

are

of

sections

Underwriters, October represented the sixth consecutive
in

constantly

capital stock, payable Dec.

aggregate

Directors

of

of

month

divi¬

a

share

a

losses

very

threee months old,

Fire

bank's

declared

cents

wide

According to figures published monthly by the National Board
of

Savings Bank of Pasa¬

met

in

Savings

Jacinto, Calif.; First

sub¬

ration of San Francisco.
all

and

claims

In the face of

Following the meeting cf Share¬
board

absorbed

happening to straight fire losses.

Bank, Long Beach, Calif.

holders

now

during the past three months.

substantial

very

through

swept

undeterminable.

Bank

dena, Calif.; Temple City National

ern

storms

Canada

and

in spite of gains made earlier.

year

National

First

are

panies have already made estimates of what total losses

%

Stockholders of the First West¬
ern

indicate

the

of

Savings Bank of Santa

Barbara,

companies

panies will undoubtedly show

First Na¬

National

These

states

reports

Calif.;

insurance

adjustments resulting from hurricanes Carol, Edna

eastern

Altos, Calif.;

Bank

First

Hazel.

and

of

Bank

Calif.;

the

course

the losses and

Fairfield,

National.

Insurance Stocks

—

present time is the trend of fire losses.

Of

Turlock,

Bank of

Grove,

First

of

at the

Week

bright spots in the insurance underwriting field

Na¬

Calif.; First National

First

tional

Ana,

Bank,

National

National

Garden

First

of the

new

$5,250,000

President.

*

of

Calif.;

the 1955 dividend rate until

Board,

000 stock dividend.
m

the

amount

capital was increased, effec¬
tive Oct. 28, from $21,000,000 to
$26,250,000.

Senior

9

of

concluded.

the

bank's

a

Bank

Andreas,

Merchants

tional

15 will

in¬

$2,500,000,

and

First

recently

$500,-

of

$2,000,000 by

Central

San

Delano,

a

has

capital

Bank and Insurance Stocks

Pinole,

Corcoran, Calif.; First National

Bank,

so

Peterson

a

of

tional Bank of San Francisco, was

El Paso, Texas, now (as of Nov. 5)
creased from

Pinole,

Watts, Calif.; First National Bank

stock of the Anglo California Na¬

said. He is Chairman of the banks'
Bank

Farmers

dend

we

these

will remain

.

*

of

Calif.;

bank's

Weed

9

past Pres¬

a

ciation, Boston.

the National City Bank of Dallas,
referred to in our issue of Nov. 4,
£

He is

Banking,

and is a director-of the
Harvard - Business School Asso¬

on

1847.

of

merce,

starting at 9:30 a.m.
The bank recently increased its
capital from $24,000,000 to $26,040,000 by a stock dividend of $2,040,000, incident to the consolida¬
tion with the Republic Bank of

page

chapi,

Calaveras,

ident of the Pasadena Rotary Club
and Pasadena Chamber of Com¬

as

dedication of its

house

Institute

Angeles.

Parma,

the date for

Bank

Bank, Temple City, Calif.; West¬

Los

ern.

directors

Calif.;

Calif.; Bank of Tehachapi, Teha-

American

13.

The

Beaumont,

Bank

As

additional

Beaumont,

1949,
as Special Advisor to the
Atomic Energy Commission.
Mr.
Fogg has been a lecturer at the
he served

McCarley & Company, Inc., and
Merrill Lynch, Pierce, Fenner &
from

of

a

holders

authorizing the increase
capital
specifically provides

Bank

25

Calif.; Bank of Newman, Newman,

Y.,

Instruments, Inc., Pasadena,

Pasadena.

(2161)

Members New York

Stock Exchange

Members

Stock Exchange

120

American

BROADWAY, NEW YORK 5, N. V.

Telephone: BArclay 7-3500
Hell

Teletype—NY

1-1248-49

(L. A. Gibbs, Manager Trading Dept.)

Specialists in Bank Stocks

.

The Commercial and Financial Chronicle

U. S. Election Results and

-

#

of

slight indication of the adoption

some

Dr. Einzig sees

liberal trade

convertibility is

the

LONDON, Eng.
London

Prime

wealth

will open
will

of

which

at the end of January,

an

for

con¬

from two points
of
view.
Even
though
British
businessmen are no
more
New
Dealers than their American

examination
of the

position
and prospects
regarding a

V'

do think that
political influence
Democratic Party will tend
they

counterparts,

•

increaesed

the

of the

discourage monetary measures
are
liable to aggrevate the

vertibility.

to

First reactions

that

to

results

the

United

about

Congressional

Dr. Paul

States indicate

Einzig

feeling

is

the emergence of a

that

prospects of

the

tively early convertibility.
This
feeling is based on the assumption
that
President Eisenhower will
it

find

easier

now

to

adoption of legislation liberalizing
foreign trade policy,

time the Commonwealth
meets, he will have
delivered his State of the Union

comes
strong

This would bring nearer
the day on which the gold reserve

By the

the

to

new

Congress, so

to

President
mitted

in

and

the

repeatedly comin public state-

has

himself,

ments

private conversaMinisters, in

British

with

tions

that

fact

the

of

view

In

implementing the recom-

favor of

mendations of the Randall Report,
can

will

continue

not

considered

drawals of

the Democrats

is whether

certain

that

follow

to

is

What

course.

doubt that he

little

be

there

to

is

It

also

that

assumed

the

both houses to pass

the neces-

majority the Administration will
be less inclined to cut fore'gn

fact

use

legislation to enable the Ad-

sary

ministration

tariff

the

lower

to

wall, to simplify
the Customs
procedure, and to mitigate the
Buy America Act.
It is true,
Democrats

less

considered

are

protectionist
it

But

cans.

Republi-

than

remembered

is

be

to

that

Cordell Hull, that apostle of

even

free trade, was

inclined to preach

his doctrine for foreign consumption

rather

home.

than

the

So

practice it at
attitude

general

here is one of "wait and

over

pending the

see,"

of more

appearance

distinct indications of the effect of
the

change
itself

In

President

the

re-statement

of

liberaliz-

Eisenhower's

ing program in his Message to
Congress will not be sufficient 1o
induce the Government to change
its present policy in respect of
It will be conconvertibility.
sidered
actual

adoption

of

the

await

to

necessary

the

proposed

influence

aid.

This

is

because

the

of

the reversal of
in

1953-54

Democratic

the

matter of foremost

a

importance,
pearance

of

disap-

the

dollar

the

gap

would
un¬
doubtedly have continued. Morethe

over,

find

it

Administration

easier

proval

of

to

the

proposed

election

autumn.

In any

cult

visualize

to

than it would have by
previous Congress,

which
next

event it is diffi-

circum-

the

gress

Howe to
Dec.

member

(Special

of

convertibility on the
general election.
from the view that a

less

feared

optimism,
that

the

be¬

On

more

than

one

occasion in

re-

cent

history the swings of the
electoral pendulum in either diof

were

character.

If the

international

an

success

of Demo-

crats in 1954 foreshadows the

Conservative
row

majority by

Socialist

a

nar-

majority in Britain
an indefinite

ment

would

not

convertibility,

Hoppe has joined the staff of J.
B. Henri Co., U. S. National Bank

Building.

as

a

result of the change in the United




bound

by

because

policy under

British
a

monetary

Labor Government
more

expan-

sionary.

However,

this

speculation

■

Havener-Hall Sees.
Havener-Hall

11-

a

produc¬

crop

,

will

tion

not

up

poration is engaging in
business

ties

a

securi¬

offices

from

Cor¬

at

51

East 42nd Street, New York City.

1

ti

a

v e

1 y

'

ricanes,
in

some

se¬

areas,

shifts

stable

and government con¬

of the njiscellaneous
crops
are
above the 1943-1952
average.
Included
this group
are
oats,
barley, rye, flaxseed,
rice, sorghum grain,., cotton, all
hay, dry edible beans, dry field
peas,
soybeans,
tobacco,
sugar
cane, and sugar beets.
Cotton—
a major crop, is
aiso above aver¬
age.
Below-average*crops, how¬
ever, include such rhajor crops as
corn, wheat, peamttSf Irish pota¬
toes, sweet potatoes^and hops.
most

fruits is, for the

The outlook for

DENVER,

Management

with

Colo.

below-average
crops
of
and
commercial apples.
Supplies of the delectable cran¬
berry will be sufficient to meet
holiday, as well as^Mnter needs.
A whopping early asud mid-season
outturn of
citru&^lruit is indi¬
The

cated.

about

should be
si#g£v .Pecans are

average

has become
Management

FIF

likely to be in short$upply in the
year ahead.
In th$~case of al¬
monds, filberts, apeb, walnuts, I
expect above-average crops.

Three With Allen In v. Co.

Soybeans

indicated

The

cojcm

may

Livingston,

Henry

Merlin

outturn

Company,

of

7.5%

below average.

higher!,

This

U.

is

S.

town"

the

as

also

farmers

record

Kenyon,
Jr., has
retail sales organiza¬

sumption
farmers

Dean Witter &

is

now

with

Co., 14 Wall Street,
City, in the municipal
department.
York

one

farmers in 1955thing, they prob¬

ably will try to restore 90% sup¬
ports. as compared with the pres¬
ent sliding-sca^e of S2Vz% to 90%.
The fight on this program,

by
in

"went

also for a larger cotton
than
the present per¬
mitted acreage of 18,100,000.
]
play

a

In

any

event,

the

farmers

should not suffer next year. Farm

prices certainly are in no imme¬
danger of
collapsing.
In

diate

.

fact, farm income in 1955 should
be off only moderately from that
of

this

farmers

year.

will

This means
enjoy a

still

means

no

aggressive merchandisers of at¬
tractively-priced quality wares.

John J. Fosdick With

Eddleman-Pollock Co.
HOUSTON,
Fosdick

with

has

Tex.

—

become

Eddleman-Pollok

National Bank Building.
dick

was

for

John

con¬

Many

gttti

Co., First
Mr. Fos¬

formerly Houston Man¬

Russ

thereto

Rupe

&

Son

Co.,

&
was

in

Inc.,

with

their

pVJR WDfy

than

of 13|20S,000 bales

alone, sufficient Ijpr probable
season's
needs, ;npt|ho mention

1 of
around 9,700,000 pales—largely in
the

big carryover TaEt Aug.

government hands.- "Cohon

nhvi-

ously is in trouble, Jg^RJJncle Sam
no doubt will
cohtiniie to bail it
out

by

Of the loan and
exports^ ! have con¬

means

are

high-grade

work out

a

people

Unfavorable growing
cut
an

who

will

fair long-term solution.

the rice

conditions

yield in California—

important

producing

state.

and

Dallas

Municipal

Bond Department.

jkice
more

Jay

associated

prove

domestic

exgqrts.

be

croo

that
com¬

paratively favorable status, and
that agricultural areas will con¬
tinue
to offer
good markets to

holding their newcrop
beans
for
higher
prices,
which, in my opinio?*, appears to
be a smart mov^«; any event,
they can put thdkfufc^ns into the
government loariHf prices should

There will

pre¬

acreage

to

vjgpj^.of the ex¬

and

I

dict, will be stiff. They may make

The indicated
<5f
337,990,000

fidence in the cotton raisers. They

With Dean Witter Co.
Bell

the

For

are

hopped-up

du

for

1956.

wprks along.

reaUy

outturn

will

my

Congress will go to bat vigor¬

ously

soybeans.

on

Indicated

T.

in

Democratic leaders

e

-

of

S.

that t'

1955

question

no

enough U. S. cfrttop : to service
Allen
total 1954-1955 requirements. The
1921 14tbr

With Amott, Baker Co.

Frank

mind

is

of apple prices.

is,

the

Glance at

A

There

3ver^e

t

season

true

sup¬

the longer-term.

suffice, but tfte carryover
1 will be ^reduced.
I

prices

L.

1

Barclay

over

Oct.

C. Tanner are with

Investment

so,

probable consumption in
19541955.
However, the^ Oct. 1 carry¬
over of 918.200,000 bushels (large¬
ly in the hands ofy,£CC) was a
record high.
Thus,«total supplies

H. Menk and

Street.

Even

well fall short of

Cotton

Colo. —George

record high.

should not prove burden¬
some,
and I forecast prices are
likely to average somewhat higher

prior

2,938,713,000 bushelsys. down
crop

of 58,534,000 bags
pounds each, is

decline!

(Special to The Financial Chronicle)

BOULDER,

a

ager

Corn and

cellent outlook for

affiliated
Corpora¬

still

100

c*qp<

pear

burdensor^P,

Douglas H.

—

However, I

part, favorable.

of

rice,

in

drought

vere

bushels

Joins FIF

total U. S. corp

a

.^Despite a
series of hur¬

use

pro¬

Louisi¬

turned in

be

still

large.

land

states—Arkansas.

record, it

,avi 11

forecast

Securities

not,

plies

of

ume

4

n

next

New

all

t~.<4

should

York City.

is liable to become

nearer

-

P.

Labor Govern-

ize, convertibility is considered to
somewhat

Oscar

—

feel

also

come

Chronicle)

Financial

Colo.

Amott, Baker & Co., In¬
corporated, 150 Broadway, New

the conditional undertaking given
to that end by Mr. Butler, but

*

This

re-

narrow

v,»

^

■

grapes

mod-

erate change of the majority in
Congress may foreshadow a similar Leftward change In Britain,

Congress with a Democratic majority is more inclined to liberalhave

to The

DENVER,

says,

or

Mississippi,
and
Texas —
a fine performance. The

ana,

of

expect

Joins J. B. Henri Staff

a

Apart

Stock

and

effect

in!o

go

ducing

1954 total vol¬

lit:

from 1953 and 4%

not only because

risk

to

Irving Lundborg Branch

would

political

Stock

tion, 444 Sherman Street/

is

tall i t: r

lfr

most

tion

a

York

admitted

other leading ex¬
changes. Mr. Howe is a partner in
Vietor, Common, Dann & Co.
Exchange

f

of

be

members of the New York

o

eve

New

partnership in White, Weld & Co.,
40 Wall Street, New York City,

postponement

the

the

will

Exchange,

joined

take

of

Partnership

Nathaniel S. Howe,

2,

a

However, the four southern

optimism. Al¬
though
the

,

viewed

with

largely confirm

Roff«r W. Babson

White, Weld to Admit

Campbell

it

all tallied,

about

in

however,
on one sj^e
jn many Conservative
quarters the prospects are
cause

bulhsh

quite

was

the Ex¬
partner

(Special to The Financial Chronicle)

A11 arguments are not,

nal

trols,

in 1955, it may mean

restoring

a

McLaughlin, Reuss & Co.

Etances in which the Government

any

of

Mr. Delaire is

stand-by

placement of the present

general

expected to be held

ap-

dollar credits by the present Con-

after

the

may

the

secure

rection

now

in

members

City,

change.

of gold

lifceralizing legislation by Congress.
This delay will make it
possible to defer decision until
is

York

entirely due
to American foreign aid. Without
it

I

52 Broadway, New

Co.,

been

dollar

and

gap

the flow

has

July

r e

&

though not

crops,

As to outlook for 1955,

the, national crop1- outlook. Fi¬
results, which now are iuSt

member of the
York
Stock Exchange, on
30 will become a partner in

under

majorities

in

Last

,

on

Alvin J. Delaire,

Gruss

of estimated

farmers should not suffer next year.

new

New

,

average.

chalk

balances,

overseas

the

Gross Go. Partner
Nov.

'

-

flexible^price sunoor^s will

Cour-

quarters

many

above

whether

of

State
R.

Walter

be

their

will

Socialized

the

cows

MENLO PARK, N. J. —Irving
The figure
is Lundborg & Co. has opened a
office
at
1134
Chestnut
around $5,000 million, not count- branch
under, the
direction
of
ing any credit facilities which Street,
would reinforce the technical Theodore D. Blake, resident part¬
position of a convertible sterling. ner.
_• '
The
expectation
of *a
sorter
American monetary policy enWith Hamilton
courages hopes of early sterling
Management
convertibility
also
because
it
(Special to The Financial Chronicle)
would enable Britain to maintain
the present low level of interest
DENVER, Colo.—Frank A. Kerrates, and even lower it further, ner is with Hamilton Management
without risking large-scale wilhCorporation, 445 Grant Street.

in

envisaged

of

prospects

the

judge
liberalisation.

like

will be

national farm

out taking undue risk.

Commonwealth P r i m e
Ministers will be in a better posithe

tion

considered

be

to

enough to make it possible to resume convertibility with-

Conference

that

a

"

the final results

on

production; points out this year's

Alvin Delaire to Be

On

reserve.

American

Address

on

when

distant
for

cared

chickens

matter of consid-

a

than hold their own in spite of
the American recession, a trade
revival in the United States would
enable them to increase their gold

the

secure

to

considered

it is felt that, if Britain and the
Sterling Area were able more

rela-

a

of. the Sterling
payments in
the Dollar Area, this

erable importance.

Democratic majority improves on
balance

be

far

not

of

balance

relation

widespread

From the

view

of

Area's

theUnited

encourge
to bring

will tend

that

upward turn.

an

point

in

elections

to

and

States,

measures

recent

the

the

in

recession

mild

present

of

Britain

in

will

•

return to con-

,

is

This

policy.

sidered important

re¬

a

we

and

called

monetary

provide
opportun¬

ity

is

States also because it is assumed
tenay, Pastor, First Presbyterian
that, under the influence of the
Church, Nashville, Tenn.
change, the Administration will
be inclined to pursue a "softer"

Common-

Ministers,

time

BABSON

'

record, will be relatively large, and output of most orodncts

present

America!"—Dr.

The coming

—

Conference

the

nearer.

ROGER W.

Babson, .commenting

crop

procedure
of each shirking his responsibili¬
ties and then calling on Washing¬
ton for aid, we can only become
increasingly socialized and thus
economically dependent upon cen¬
tralized authority. By this means

policy, though he points out, eren with a Democratic majority
in Congress, there is still doubt that the protectionist policy
will be abandoned.
Finds other factors indicating sterling

in

Thursday, November 25,1954

..

Agricultural Situation
By

Road to Socialism

the outcome of

a more

The

convertibility

Mr.

changed prospects regarding a return to

In commenting on

no

*

EINZIG

sterling convertibility which may result from
the recent elections in the United States,

be

until the autumn of 1955.

"Under

.

It is

that in any event

assume

will

there

Sterling Convertibility
By PAUL

to

sale

premature.

rather

be

may

a

.

(2162)

26

Saving^

,.

Volume 180

Number 5380

The Commercial and Financial Chronicle

...

(2163)

acquisition

Piospects Regarding

which

have

The Railroads
Director, Bureau of Railway Economics
of

American

must

the next
J

and

spokesman contrasts declines in rail traffic and
.earnings with the growing strength of the national economy,
statistics

for

internal

carloading and operating revenues.
the unfavorable competitive position of the

and also

emergency,

business conditions alone will

ings to levels attained in former

traffic and

economy

of

down,

have

which

s u m m e r

1953.

began

in

the

late

of

For

j

u s
"

iron

been

rather

mild.

In

the

econ¬

out

the

report goes

that' the

Gross

down

was

of

non-

was

incomes

actually
slightly in the first half
These

comparisons

are

is

our

country was enjoying,
by all the usual standards, a very

high level of prosperity. Many of
basic

reached

economic

all-time

indicators

high

levels

significant, in
view of the continuing strength
of the general
economy, that de¬
clines in traffic and earnings of
more

railroads

more

This

statistical

is

40

of

shown

ing

few. For the
year,

months

of

for

1954

dropped 13.7%

com¬

pared with the first eight months
of

1953.

Because

of operating
duced
fic

effect

the

many

costs

upon.

the

Again,

months

net

for

this

of

the

year,

operating income
than

re¬

decline,

revenues

a

year

after

most

of

seri¬

first

eight
net railway

was

32.8%

less

and net income

ago,

fixed

the

earnings

railroads has been

ous.

elements

not be

can

proportionately when traf¬

and

charges

dropped

41.0%. The effect upon the finan¬
cial

resources

their
very

of the railroads and

spending budgets has been
pronounced, as some of you

know

from

your

own

sales

fig¬

ures.

Railroad

railroad
much

is

it,

more

D.

Tie

C., Oct. 21,

in

properties

employees

good
your;

in. Here, too,
fit

their

ex¬

for

work

per¬

Traffic

you

may

has

ask,

declined

railroads

for

by Mr. Monroe before the
Associat.on, Washington,
1954.




larly

take

subsidized

leans

the

on

the

'

to their suppliers, their
employees, and to communities
and
shippers f dependent
upon
good railroad service for their
transportation needs.

truth, the country
vital intefest

a

whole

as a

in

improving
railroad traffic .and earnings in
order
that Jim/ requirements of
commerce and, the national secu¬
rity may be met fully and ade¬

have

with

the

tem

difficult to

greater calamity
nation

our

than

become

sys¬

ability

of

the

taining

and

properties.

be, they
insofar

It

life

essential

improving
is

a

that

stern

no

their
fact

matter

of

how

such

expenditures may
be/undertaken only

can

as

financial

resources

will

permit. This may be demonstrated
with

reference to-the capital
penditures of^ the Tailroads in
cent

years.

1946

years,

ex¬
re¬

In the eight post war
to 1953, Class I rail¬
billion dollars for

roads spent 9.1

additions and betterments to their

properties
billion
such

oF aft'average

of

1.1

dollars

a'year. In 1953,
expenditures amounted to

1 lA billion dollars. These amounts

be contrasted with estimated

capital'expenditures of only

36%

dollars for
than

less

consequences

of

all of 1954,

for

this

1953.

The

decline

are

evident when its'*effect upon em¬

roads

have

external

almost

no

of

the

unfor¬

which

for

any

tions

price,

to

99

well

as

has

the pur¬

as

ranged

million dollars in

annual
1953

for

average

from

period

1953.

the

maintenance
ture

expenses

It

is

less

of

with

their

and

way

struc¬

up

purchases
the

and

way

as

as

by

first

20.8

means

of

financing except in the

that

these reduc¬
employ¬
number
of

average

of
way
employees
eight months of 1954

than

the

Need

More

a

way

to

to

money

the

the

three

and

of

the

year

For

of

dollars

this

as

com¬

the low level

the

make

year

better

a

What

existing

prospects - for
it is clear

While

conditions

well

as

for

for

as

ties

cross

pro¬

not

we

good,

to

will

improve,

continue

necessity

of

to

be

holding

expenditures

than

Now
do

and

extent

some

this

where
that

means

maintenance

re¬

conclusion

it.

do

spend

The

traffic.

elementary

best
That

truths

which every self-supporting
business must contend, as I am

own

you

know

from

these

well

remarks,

your

experience.

In

preparing

made

some

figures

for

purchase of

examination

prior
cross

roads. As I did

of

course,

which

has

number

of

placement

the

I

the

on

years

of

the

ties by the rail¬
took

note, of

long-term

decline

so

I

occurred
cross

ties

in

the

laid

total

in

re¬

railroads as a
result of the shift to long-lasting
treated
wood.
Whereas, in 1920
the total replacement amounted
to nearly 87 million ties, in 1953
it was just under 30 million. I
by

future, I certainly
pretend to have any spe¬
gift of prophecy, nor do I

cial

as

Even

seer.

all of
to

of

so,

economic

an

is necessary for

through
the

the

future

business

sary

it

of

to do what little

us

peer

tain

kind

any

we

misty
that

so

planning

can

cur¬

neces¬

can

go

forward.

Trade

Policy

Gatt—Rayftiond Bernon

Outlook

present

Improving

there

past

five years from 1949 through 1953

to

seems

be

rather

widespread hopefulness
analysts and forecasters

among

that

a

and

that

bottom
a

has

been

business

be expected over the
In

been

increased
steel

reached

upturn

coming

important

some

have

Department

of

Economics

and

Institutions,
Princeton,
University, Princeton, N. J. (pa¬
per),

request.

on

Automatic

.

ir

Merchandising:

Directory—National

19 5 5

Automatic

Merchandising

Association,
7
Street, Chicago
3, 111. (cloth) $3.
/

South Dearborn

Bases

Industrial

for

Relations

—

Waldo E. Fisher—Industrial Re¬
lations Section, California Insti¬

of

tute

Technology,
$1.50.

Pasadena,

Publications

List

Calif, (paper)

Complete

Fall

1954—Foundation for Economic

Education, Inc., Irvington-onHudson, N. Y. (paper).
Motor Truck Facts 1954 Edition—
Automobile

Manufacturers

As¬

sociation, New Center Building,
Detroit, Mich, (paper).
Occupational ?M
United

Jaffe

States
R.

and

lumbia

o

b i Iit

in

y

O.

Carleton—Co¬

University

Press,
27, N. Y.—$2.75.

York

Private

Investments

Charles

R.

the

1930-1960—A. JV

New

Abroad

Carroll

—

American

—

Enterprise

-■ Association;
I n c.,
Street, N. W., Wash¬
5,
D.
C.
(paper)
$1
(quantity prices on request).

1012

14th

ington

lines,

can

activity.

production

Regulations
Funds

Relating

Control

to

in

Foreign

the

United

States—11th Supplement—Bank
for
International
Settlements,

Basle, Switzerland, (paper) Sw.
francs 4.

year.

there

indications

recent

of

The rate of
has
shown
a

firming tendency in recent weeks

Role

of

Sampling
in

denced

istrative
of

Data

Judicial

Business

As

Evi¬

Admin¬

and

Proceedings

—

Advisory

Society
Profes¬

headed

sions, Inc., 6 Washington Square
North,
New
York
3,
N.
Y.
(paper) $1.50.

higher levels of operation.
According to latest reports, con¬

Twentieth Century Capitalist Rev¬

it

and

that

the

may

appears

industries

goods

be

heavy

toward

struction contracts continue to be
awarded

large scale. As now
1955 is expected to be

on

foreseen,
an

a

active year in automobile pro¬

duction, which is one of the key
factors in determining the gen¬
level

eral

of the

economy.

larger

orders

coming

goods

industries

such

the

noted also that in each of the

Foreign

and the

reduced.

to the

as

not

pose

a

to

America's

all

are

is what lies ahead.

now

Unless traffic conditions
railroads

the

the

are

question in which

interested

will

showing.

1955?

ducers of

appear

whole

a

about .the

year

the

as

rail¬

of

earnings, it does not

I have

with

sure

strong

a

for

railroads.

months

that

Business

to accomplish that is through

one

upon

improving system of railroad

will not

road

Money

are

increased volume of
is

public generally in its

dependence

struc¬

good

very

million

ties

At

improve and maintain
properties they must have

their

to

employees,

whole.

a

corres¬

to

more

their

has

view of the decline in production

year.

the railroads

if

more

to the

basic

rail¬

earlier,

year

the first three months of 1953, or
a
decline of three per cent. In

of

period, oper¬
dropped 13.7%. As

lead

suppliers,

the

to

said

a

pared with 21.4 million dollars in

same

The conditions to which
referred

only
I

as

re¬

to

than

evident that 1954

their

ponding period last
Railroads

their
and

not

but,

Such

and

was

somewhat

down

of

less

roads

helpful.

The1

1946

$8.9,352,000
range of variation from
year
within this period

the

the

also reflected in

16.5%

most

beneficial

the
field

low of 82.5 million dollars in 1949

under

expected,

first

be

in

transportation.'

chase

the

maintenance
the

could

inequities

transportation

handling costs

trans¬

railroads

The-

"eliminate

competitive

and

which

the first eight months

are

ment.

to

War II, the outlay for ties, which
includes
certain
transportation

is

1954, were reduced by 13.9% be¬
low
the
first
eight months of

make

to

than

amount

total

the

upon

railroads

the

rather

expenditures for main¬

necessary

business

effects

greater

a

1953

year

maintenance

gards the railroads.
outlined

the

quirements will only be deferred

in

important

For

medial action would, of
course, be

expenditures of the railroads for

be

policies regarding competition in

for this very essential mater¬

industries

revenues

We still need sound public

years.

Social

possible, with
of
operations

One

1953. Over the

earn¬

pay

practicable,

tures in

and

transportation. Constructive steps

material and supplies. As a result
of declining traffic and revenues,

was

have

the

traffic

total

to

budget control is the unsta-

would

have

their

18

tunate consequences of this neces¬

emergency

impoverished

conditional

of

particular

that

and weakened. The year 1954 will
stand as a year of warning as re¬

The

1%

year.

this

railroads

furnish

of

—tinternational Finance Section/

total

where
scale

the

however,

improvement

Thus, with respect
item, there is
a
rather definite relationship to
operating revenues, marking the
ability of the railroads to buy and
to

penditures,

ating

essential railroad

had*

to

year

the

confronted

national

great

a

when

would be

of

operating revenues, with no very
great change iii^this ratio from

The stability of these ratios re¬
flects the necessity to control ex¬

effect

general

ings to levels attained in former

of

to

that

restore railroad

operating
revenues. One out of
every three
dollars taken in by the railroads
goes .: to
keep
their
plant
and
equipment in proper shape.

mitted

outlays for
improvements

and

year, it is reported that railroad
purchases of cross ties amounted

expenditures
one-third of the

railroads'

bilizing

maintenance

in 1955. Let it be noted,

of

between

expenses

just about

sary

carriers-

for the cross-tie industry, largely
because of necessarily
curtailed

ex¬

maintenance

revenues.

the

better position

recent years to

9/10

measure

and

in

in

in replacement

about

World

maintenance
I

and

be

increased

ties laid

cross

striking stability

and 19%. Year by year, without
much variation in the ratio, these

Class

then

have amounted in

maintenance

and structures regu¬
about 14 to 15% of

equipment

sur¬

harmful

In

since

years
a

of

Expenditures for mainten¬

revenues

as

so

than the general level

ratio

of way

ance

reasons

are

it

of

the

shows

the

and

806 million

that

for

matter of very great con¬
changes
to the railroads but is no less ;

cern

to

expenditures of Class I rail¬
II

enues.

they

as

ployment is considered. The rail¬
Railroad

main¬

respond
make

for

been

a

Declined

traffic

*An address

their

in

to

business conditions will not alone*

to

War

prosper¬

competitive position is not

equal

only

or

Why

railroads

must

roads

in

provision of
transportation facilities. This ^un¬

total
Has

consider the expen¬

now

railroads

the

ance

explanation
is
situation
with

much

Government

may

Why

Expenses

also

would

the figures a - little
I noted that the total
charges of the Class I railroads

further,

their

condition,
question but that

no

competition^ which

improvement.
ton-miles

11.9% and total operat¬

revenues

and

penditures to total operating rev¬

the

treated.

other year since 1930. Since World

comes

take

a

which

a

in

eight

down

was

rounded,

imagine

every

this

no

traffic

first

attained

of

and

penditures to their ability to pay
their suppliers for materials and

of

from

generally

all

the-

of

by

less
than
in
the
corresponding
period of 1953, and recent weeks

the

us

total

It

among

only

weeks

Freight

-

is

quately.

total
carloadings have been nearly 14%

have

issu¬

traffic

Maintenance

industry

own

unfavorable-

much

summer

shown

measure,

I will mention

first

been

since the

severe

1953.

have

the

fully

which

has

It is all the

the

condition, for that is where

1953.

outstanding
competitive

the

last

year.

the

analyze

the

given to the fact that, as the re¬
port points out, in the first half

the

through

taining

whole. It is not possible here to

Product

that

and

a

in

there

remarkable when consideration

of 1953

from

revenues.

Let

of

as

conditions of the economy

ous

but

employment

personal

1954.

activity

half of

this

Comparing these tw;o
periods, it is further shown that
up

first

to state

on

National

2.7%

agricultural

were

dollars

equipment

in

for

down 2.6%.

total'

well

as

manufactured

economic

should

indicators

corresponding period of

1953: The

Movements

coal,

slightly from a thirty million an¬
nual total, nearly all of them new

charges for cross ties laid in re¬
placement amounted to slightly
over 99
million dollars, which is

of

ditures of the

materials

railroads have not shared

economic

show only slight declines for the
first half
of
1954, as compared
with< the

them.

and

in

only

billion

Railroad

there

Beyond this, however, the plain
disturbing truth is that the

that

of

into
ore

varied

ial.

declines in

raw

laid

ties

cross

has-

properties, and the remaining

operating

industries, notably

the

of

obligations.
Thus, nearly 80% of the total was

and

J. Elmer Monroe

ust, he point¬
ed

and

earn¬

owners

formed. A tabulation of mainten¬

the

omy,
issued
in
mid-Aug¬

most

that

2.6

of

na¬

tional

fact

substantial

products

report

the

on

the

depre¬

them, have been substantially re¬
duced. It is necessary to remem¬
ber, that in 1954, comparisons are
being made with very high levels

Presi¬

dent's

been

going

tment

has

in

products

downward
d

found

re¬

about

from

came

of

1.9

of railroad traffic both in finished

apparent
that
this

dollars

ance

steel, automobiles and appliances,
which account for a large part

now

annual

accumulations,

generated

the hard goods

the

economy as a
whole
it
is

a

is

from

number

replacement

the

activity during the
year?- Largely, the answer

past

bil¬

one

up
during the war
approximately 3.5 billion

came

billion

earn¬

own

from

ings withheld from the

economic

generally have been going through
a period of
adjustment, or settling

About

ciation

portation field.
the

of

built

dollars

needed is elimination of inequities in the
competitive trans¬

The railroads and

all

by rail¬
improvements,

taken

was

the

Pursuing

nearly

capital

sources.

period,

Concludes, what is

years.

15 years.

1953,

dollars

serves

view that improved

expresses

not restore rail

10 to

through

lion

of

means of transporta¬
Stresses importance of sound rail lines in event of a

national

and

had to be derived from their

Lays situation to
railroads, due to subsidies granted other
tion.

incurred

liquidated within

the 9 billion dollars spent

Railroads

Railroad

cites

been

be

charges

/Since the end of World War II

roads

and

fixed

and

already

which

By J. ELMER MONROE*

Vice-President, Association

of
equipment,
for
large amounts of in¬

very

debtedness

27

and

shoes

their

have been

With

in,

as

soft

olution, The—A. A. Berle, Jr.—
Harcourt, Brace & Co., New
York, N. Y. (cloth) $3.
Yankee

Genius:

W.

Roger

A

Biography of

Babson

—

Earl

L.

Smith—Harper & Brothers, 49
East 33rd Street, New York 16,
N. Y.

(cloth) $5.

textiles

stepping

up

operations.

Your

Opportunities

in Manage¬
ment—Vocational "guidance
booklet
National
Association
-7-

If

these

proved

expectations

business

are

railroad traffic and

of

im¬

sustained,

revenues

will

of

Manufacturers,

Street,

(paper).

New

York

2

East

17,

48th

N.

Y.

23

amounts

tax

investment

Securities Salesman's Corner

skillful

Record

of

startling increase in assets showed
increase from

an

and

panies paid

casualty insurance companies
show

to

just

what

of these

ments

manage¬
or¬

the

in

ganizations

the

representative

in¬

insurance

dustry

produced for their stock¬
These 60 companies han¬
dle a majority of the fire- casualty
volume, and comprise practically
ail of the publicly traded issues,
and are therefore representative
holders.

the industry

cf

as

also

$2,762,413,000 ij

these

dividends to

com¬

of 40% in

an average

look

reinvested in

was

That

ness.

is

main

the

of

one

the

he

If
an

should

25

and

some

existence

to

years

in

that

in

been

a

why the investors in ty

reasons

fine

insurance

well.

Tax

..

advantages such
85%

industry;
stocks

are

tax

still

the

the

is

they

as

is

or

compre¬

rightfully
of

average

largest

an

will

gains

from informed selection

come

of individual

free, and the companies own large

Report

and

this

state:

their in¬

vestments

Fewel

hensive,

as

dividends received from

in

companies.

Continued from

first

page

Years Ago

The

investor

Dec.

the

bought

31,

1943,

tights subsequently given to him,
experienced the following; gains
during the past 10

We
See

As

stock on
who sold the

and

tion

A

8.61%

year_____

per

total

gain

year

sult

13.84%

rights the

re¬

would be:

9.21%

Income average per year.

total

Average

gain

5.13%

per

,

14.34%

year

Retained

It Is

It

is

fire

today these

The

1943.

cost where

on

exercised.

were

Experience

of the

Years Has Been

Five

Past

If

this

he

investor

had

his

sold

have

would

had

these

per

motivated

have

total

5.09%

gain

16.11%

If he had exercised these

rights:

"rolled

11.11%

year

Income average per year.

gain

5.00%

16.11%
income is indicated

at

illustrates

dramatic record which
how

investors

buy

can

into growth

companies, in growing
industries, and escape the heavy
penalties of
lector.

the

income

The insurance

tax

col¬

business which is still encouraged
and aided by our present legisla¬
which

allows

these

up
a

income

brackets

to

the

escapes

the tax collector

earnings,

than

it

dividends

large
tained

nations—will

This

the

Fewel Report

build

income

heavy hand of
through retained
is

to

and

reach

for

smaller

re¬

ment. These

10 years, the
states, the premium

income of these 60 companies rose

a

gain

well

as

the burial of the

over

of

to $3,719,870,-

200%.

by colonial

let it be recalled that what is
was once a colony. Let

powers,

the United States of America

virtually all of Latin America

acquired its freedom from imperial masters many, many
decades ago. There has, of course, been much exploitation
of China, bpLno foreign power has ever succeeded in
really conquering or controlling the Chinese people. And
so the story might be continued at great length.
is important here is the fact that these back¬
peoples of the earth are in very large degree back¬
ward through failure of their own, and that if this situa¬
tion is to be remedied they must do the major part of the
What

ward

work themselves. There

is

no

the others

as

A




are

still

by

a

more

it

more

backward
But

people inhabiting

well be true, in some in¬
undoubtedly true, that these peoples have more

an

age

the

ever

of the activities

comforts of

being

common

world

are

exploiters. But

do not today enjoy the material well

are

easy prey

(for

a

time, at all

schemers who promise the earth and every¬

new

thing that is in it in order to get control and to impose
their will upon

the

or

masses.

southeast

Asia, of Africa

of South America upon an economic
with

that

of

even

of Britain

the

ordinary

the

cure

is

a

long, long

or even many

even

Four,

Dealer

Dealer, could possibly bring

or

Fair

quarters,

if

all

hardly

could

more

be

than

this economic imbalance. One
some

the Truman

the visions of the most rabid New

plans and proposals

even

would make

or

European states, then

dream of Point

or

parts

footing comparable

off. Not

way

placing the native

in the United States

man

other Western

or

is

said

ignorant souls do—-the

now

such

coming from

effected
a

any

without

small impression

might

energy

as

well

and

done, the native peoples

shoulders to the wheel, reveal

willingness to deal fairly with investors, and be pre¬

improvement and betterment.

Where do we find such

willingness and how is to be cultivated? These are the
crucial

questions.

Why Must Government
Undertake It?
"When young

people cannot hope to find living

quarters in which they can lead a
raise

a

family, how

re¬

many

construct

good housing in adequate quantity—and

workers the
as

their

certainty that their wages will increase

productivity increases is to strike the sword

from the hands of the Communists.

"Frenchmen, like other people, are deeply dis¬
turbed

by what

standard of

for

in the development of a better

living. Perhaps they

centuries

of

are even more

dis¬

other people would be, because

their

national

life

they

led the

We must meet this deeply felt

world in progress.
need of the French
a

to them to be an all too

appears

slow rate of progress

people;

we can

do this only by

growth. This
itself.

great acceleration of our economic

is the task to which my

government has set

—Pierre Mendes-France.

What

why

we

the

cannot understand from

French

Government

this distance is

must

satisfy

the

"deeply felt" economic need of the French people.
Can

upon

attend

compare—as

normal life and

they help despairing of the

quickly—as it is to equip armored divisions. To give

delay,

generated by fission

can

country in which they live? It is as important to

turbed than many

If the solution consists of somehow
of eastern

all

pared to carry the larger part of the load of economic

the industrialized nations of the

among

dissatisfied and

events) of

of so-called

of unrest and rebellion. Peoples who, what¬

reason,

peoples of the world.

when

themselves must put their

its abandon¬

even

and

difficulty at best, this is about the only road open to the

softening of the

may

rather than less of the necessaries and

results reasonably

with reasonable confidence expect

satisfactory. Indeed, short of centuries of hardship

industrial¬

only because, often not all because, of exploitation by
Indeed

powerful

helping hand if terms and conditions are such that they

rebel¬

relatively little of the good things of life not

forces.

foreign

palliation of the condition. True, of course, that these same
foreign peoples could be persuaded to lend a

danger they

or even

backward and the

even

other way. True,

peoples who have surplus wealth could achieve some

important assets.

as

solved

be

not

areas are

Growth?

past

from $1,242,014,000

000,

presiding

picaresque attitude of the imperialists

sults. All the
Why

feel certain that Mr. Churchill

we

of conflict between the larger and

carry

earnings?

During

punches" that have been thrown

underlying problem of unrest and

capital values while receiving

smaller initial dividend

that

Britain, France and Holland

counting their foreign domains

compan¬

ies to build up reserves and equi¬
ties for the stockholders.
How
much better for the investor in the

higher

like, but

industry is

typical example of.the type of

tion

the

as

Empire. France and Holland

this is

Buying Into the Future

a

with

life because

a

about

6%

cost.

Here is

not even surveyed their resources, and
little about their extent. The same is true of.
much if not most of Asia, and certainly of the larger part
of Africa. If it be said that the backward areas were held

have

countries

much of the earth's surface

as

intention of

no

stances is

per

year

1954

in natural resources, even in com¬

parison with the United States and Canada? The truth
of the matter is that even to this day many of these

has cut

by the drift of human thought about "colonial¬

ism" and the

outside
total

by which the world is today con¬
Hemisphere south

of the Rio Grande poor

a

at them

them have

A_verage market apprecia¬

on

over

per

r^ear

Average

who

11.02%

year

per

scream

one

moment that the Kremlin is

a

possible. Such countries

ized

tion

and

by human uplift sentiment in its attempt to

spread its control
as

for

supposes

No

lion in the so-called backward areas—and the

Income average per year_

Average

Hitler loved to

seen.

"Have-nots."

the

and

teeth

But the

Average market apprecia¬

j

still to be

are

"Haves"

his eye

gains:

tion

us

and ability to work and make the most of what na¬
provided. Eighteenth and nineteenth century imperi¬
alism was largely concerned with competitive control and
exploitation of the weaker peoples and the richer parts
of the earth's surface. Such policies and purposes carried
over
into the twentieth century, and in one form or

still has

Even More

Impressive

rights

'

Yet,

sold, and 7.12% where

were

rights

causualty

stocks produce

income of 7.09%

an

rights

note

these

on

-

back in

same

of the situation

tithe

can

only 4.07% when they

was

available

were

to

return

average

representative
stocks

problem that is still with

likely to be for a long while to come. It is a situation
grist for the geopolitics mill for centuries
past—this uneven distribution of the world's population,
of the world's natural resources, and of people's willing¬

the

Growth

interesting

very

the

Long-Term Problem
world

is

another

Earnings That

Produces

that

a

ness

year

per

of

ture

Average market apprecia¬
tion

have been produced by political oppression. Sheer^
sometimes have played a part. But none
these factors, or all of them, account for more than a

misfortune may

it be further recalled that
any¬

which has been

per

_______

If he retained his

Here then is

5.23%

V?^me average per year.
Average

It

that they have refrained or intend to refrain
where else where they believe the fishing is good.

years:

a

may

now

pose

Average market apprecia¬

Happen?

good thing if all of us would pause to
consider how this inequality in economic well being came
about in the first place. In some instances, perhaps, it is,
a result of uneven distribution of resources.
In a few it

back

who

fire-casualty

average

How Did It

It would be

know very

whole.

a

The Investor Who Bought Ten

earthquake.

an

fronted. Who would term the Western

The

c'^.e

have

stocks

with that of a

fusion of the atom contrived by man

hurricane or

for

century

more.

so

Thursday, November 25,1954

and

fire

great

business

has

from

busi¬

the

company

at

insurance

the stockholders and

cases

60%

or

...

these

of

research

casualty companies—there he has
the equivalent of an investment
company, plus the earnings of an

$7,427,285,000.

During this period

the

talent in this country.
wants to invest in

investment

Growth

Be¬

of

one

any

Co., 453 South Spring
Street, Los Angeles, Calif., have
just released a study of 60 fire

head

departments

investment

expert

&

the

great institutions some of the most

By JOHN DUTTON
A

bonds.

free

sides there is at

Fewel

Financial Chronicle

The Commercial and

(2164)

This

not,
to

indeed

their

own

question

analogue here.

must

not,

the French people

economic needs?

troubles

us

for

we

have

its

Volume 180

Number 5380

The Commercial and Financial Chronicle

...

V

Continued

from

3

page

-

« -

.

(2165)

29

-

.

Puerto Rico Water
Our

The Market Ahead
tributed to the advance
of

positive

a

than

a

mean

exert less

stimulating

they have become

sant;

force

But this doesn't

year ago.

markets do

depres-

a

gather

internal

momentum.

Further, this era is
dominated by the sophisticate who

buying on reactions rather than
selling on rallies. Temporarily,
however, the more than 20-point
advance

of

the

past

rather

than

the

ing indiscriminate. In other words,

upturn

in

than

probability.

believe

there

excuse—or

must

be

major

a

major surprise—before

the present trend will be reversed,
The surprise or excuse isn't on
the horizon now—and the earliest
it

develop is late winter or
spring.
Even then, the ex-

may

next

for

cuse

new

a

speculative

psy-

chology could be "minor" rather
than

"major."

could be the

market

as

priced

a

if

For example, it
negative fact that the
whole is adequately

business

conditions

in

.ri955.shiiiA;.ilJ3ly little improvement
1954.
In this connection, a
change in the outlook is dependover

ent

upon

change

a

in

one

or

a

combination of the following fac¬
tors:

(2)
a

for

reason

rise;

worthwhile

A

is

1955

hope

a

the

business

It may be

a

velopments may be needed,
Even

if

a

ceiling

a

whole,

we

to

buy

means

concentrated

good time
The tremen-

of funds seeking a
that interest will be
issues

on

inventory liquidation this
do

in

better

eraj

1955

without

implemet,
are

carpet,

gen-

farm

and

which

come

few

a

a

The

business stimulus.

And

there

television
to

others

are

year can

mind.

that

will

pete with each other for the buyers' attention,

means

continuing

a

if

economy

the

as was

jumped

case

not

when expenditures

$19 billion
to $26 billion in 1951.

in

for

The

1955

is

and may
creased

decline

in

prospect

comparatively

small

State and local

force towards

spending,

spending thus is a
stability rather than

in

this

com-

I

suggest

The

now?

following:
Steels

the

the- test

industry has
readjustment

of

with flying colors. The stronger
companies operated profitably at
55-60% of capacity and prices remained firm.
Demand now has
turned upward and profit margins
will improve due to the efficiencies introduced during the readjustment period. The "cash" earnings rate in many cases is very
high.

in

1955

against

in

1954

and

and amortization. The steels now
have "class" status and ark being
bought by pension funds and in-

Industrial

about $36

$35

and

billion

small

billion

in

1953.

commercial

building will decline, but residential construction will be

a priimprove in

will

In

$4 billion which is
pressant.

Next

inventories
auto

least

obvious de-

an

industry's

year,

increase slightly,
should do at

may

industry

well

as

in 1954—and this

as

important to the entire
In view of the

think the

velop
pect
nor

a

economy,

foregoing, I don't

business trend will de-

downward bias: the prosone
of neither boom

seems

depression.

general

If

business

better than

now

conservative

anything,

trend

In

view.

the

may

be

likely

appears

on

this

event,

good corporate earnings gains are

I
in

??£/orA?
1954.

imPr°Yed

Also, dividends could

crease

in-

inasmuch

for working

as industry's need
capital has declined.

Prospective
r-

D-J

...

.

,

,

.

.

,

industrial

of

pr^ucho" 1955 to average about
were
123-130
(this

m

years aver-

be about 125) earnings on

the Dow Industrial Average might
be $30 to $32 per share. Currently,
the industrial average yields about

4.6%
and

on

its estimated $17 dividend

sells

at

13

earnings of <528

times

ner

fng no® change 'in
mg

estimated

share

the

Assum-

con«den"e

factor

-i.e., the same price times
earnings ratio as today—the 1955
earnings hope mentioned above

theoretically could spell

a price

of

390 to 415 for the Dow Industrial

Average.

At any rate, that is the

arithmetic projection.
All

in

all,

therefore,

which

program.

Stocks,

are

But
can

demand

the

wood

companies

benefit from higher in-

not have

tention,

and

Masonite

unlikely the remainder of
this year. It points to a policy of

in

were

tion.

line

its little surprise
a

U.

merit

prior

the

to

reflected

public

in

the

better

side, because

The

.

in

of

some

market

1V\%

refunding

any

the

appears

Excessive

of the

care

too

inven-

Federal

Banks.

Also

the

There

interesting

specu-

cellophane,

Vis¬

tire

textile yarn, nylon, acrilan.
United Merchants—an across-the-

was

would

do.

The

corporations

are

that

will

of Aug.

the

?°™pany ™"'d do-(quite we", ln
„
a
t,?
ds ne^ T10 ? s

The

Commercial

at

will

year.

make

sizable

Authority,

last

new

that

The 1963

deposit

bond fits well

of New

York

years

issue

in

will

be

applied to redemp¬

tion of these notes.
The

Government
for

Development
Rico

Puerto

mitments
of 2%:%

in

the

This is

with

schedule

of

well

to

(Special to The Financial Chronicle).-,,

Inc., 408 Olive Street.

this

maturities

With First of Iowa

Government

Governments

is the

of

case

with

the

the

deposit

banks

because

these

other bonds.

these banks

as

Also

the

\lA%

certificate will

First

the

needs

those

114% certificates due Dec. 15, 1955.

exchanges made into the 1Vi%
The

Treasury

turing

ones

There

the

in

are

issue by

current

(Special to The Financial Chronicle)..

Buchholz

a

are

again,

purchasing

be

Treasury

borrowing

do

to

tailored

have

a

a

anything

in

important

offering securities which

TREASURY,
STATE
and

!

MUNICIPAL
SECURITIES

long-term

bond

borrowings by

-

there

corpora¬

These other forms

influence

refunding

>

maintenance of

a

the

upon

it is evident that the

its

'""

■}

U. S.

economic and business

real

competition with

very

to

ma¬

power.

offering

of economic conditions and

going

again

being offered to the holders of the

not

added

&

corporations.

weather eye towards

by

been

Co., Min¬
neapolis Grain Exchange Building.

to meet the prevailing conditions in the money mar¬
is also

deposits, which

of

has

Bache

of

issues

There will also be

appeal to the commercial banks, there will be

not

staff

.

Minn.—AlfH&f,

interested in

be

refunding has

conditions in this operation because,
by

Then

'/>■'»

It is

that the larger commercial banks will

making exchanges in important amounts of the maturing
the

Corporation.

MINNEAPOLIS,

of

?

Bache Adds To Staff

the

meet

of Iowa

-fV';/,;y

rate

securities for liquidity purposes.

i

R.

Paul

■

N.

one-year

—

Pierce has become connected with

com¬

coupon

Neb;*'

HASTINGS,

concerned.

are

i.

'

(Special to The Financial Chronicle)

a

eight-

to go out too far when making

or

far

as

obligation

an

Liquidity Issue, Too

into

—W,-:

ST. LOUIS, Mo.—Ray J. Wegemann is with Slay ton & Company,.

set

a

fiscal

Slay ton Adds To Staff '

offered in exchange for the Dec.

for

not inclined

is favorable

The

is

Rico Water

Resources Authority.

attracted

are

crowded

Likewise

under, which

or

works

are

into

outstanding.

eight-month bond being

institutions

banks
not

to pro¬

capital improve¬

'^•'

are

maturity of 10

maturities,

is

area

summer,

program and part of'.jjie
proceeds of the forthcoming bond

be

Issue

bond.

new

it.

.-<t

Water' Re¬

ments

large money center institutions

exchanges into the

obligation and the

that the

year

Bond

the

for

*

Rico

Puerto

City Bank

banks, especially those in the out-of-town

also indications that the

are

type of security.

15

Banks Like

customers

236,812

vide funds for its

will be attracted tosthe 2Vz% bond due Aug. 15, 1963, and

$reas,
there

commercial

699,920$$$

arranged $10,000,000 temporary fi¬
nancing at 2% with The Natipnal

Bank

tions, states and municipalities, and mortgages.

field,
sells around
its net working capital equivalent.

estimated

agent for the Puerto

The

Rico

at

220,860 last

15, 1955, which were

will

c]Gthing chain. In the carpet

Puerto

present fiscal year compared with

eight-

interested

be

,

the

Resources

sources

not

.

of

000,000 compared with
a
year
earlier.
Total
are

favorable

conclusion

districts of

Authority ,.for
fiscal year are esti¬
$19,669,000
compared
$17,825,369 in 1953-54. For

with

/"./*• '

hoard operation with an interest
in cottoni rayon and the Robert

Chrysler—for

the

on

rural

the fiscal year 1954-.55, total kilo¬
watt hours are estimated at
781,-

and

foregone

a

jjaR

Specialties:

an¬

opera¬

intermediate

the

and

1954-55

mated

was

that there would

so

upward
of electri-

consumption

urban

the

"reopened" for the refunding.

ket.

a year ago.

of

raising

This

were

was

Banks,

eco^-

;has

Island.

Water

district

markets when

Treasury.

of

Treasury

making the exchange into the lVss

running ahead of

cose—maker

financial

money

the

action

Rico's
which

pronounced

a

in

Revenues

evidently put into the package to take

was

Reserve

there

the securities which

American

the

heavy holdings of the Dec. 15, 1955 maturity by the Central

volume and prices since last spring
—and advance bookings now are

available:

trend

both

the

money

by

Puerto

expansion

brought

uncertainty that had been overhang¬

which

month iy8% certificate

tories have been cleared up—there
^as j3een a steady improvement in

number of

nomic

ity, the Water Resources Author¬
ity has extended its facilities in

or new

obligation

indicated

lations

Reflecting

"tiding over"

S.

towards
Armstrong Cork and Ruberoid.

are a

for

beginning to disappear.

was

one-year

at-

disposed

have turned.

than

what

for the

announcement

also

cycle

on or after Jan.
1, I960 at
prices ranging from 103% to par.

generally looked for, especially during the last few days

that must have short-term

the

notice

money

Moreover, the eight-year, and eight-month 2W% 'bond

rather

Also, American Radiator

Textile—for

serially from Jan. 1,. 1957
1990, the bonds will be
subject to redemption on 30 days'

to July 1,

long time since the Treasury

a

refunding

—which has just increased its dividend seems quite interesting. I'm

favorably

other

with

It has been

building

attractive.

appear

Plywood

trend

Treasury is not

operation

to

upset

the

"apple cart."

,

cllck

and there

1S

company

is

and

cars.

where

ican Locomotive
management

basic de"

a

™nd for five million

Amer- potential reward justifies the risk.

With Walston & Co.

The difference between intelligent

(Special to The Financial Chronicle)

a

revitalizing

diversifying

new

the

opera-

Some
you

of these

stocks

are

what

might term "speculative." But
country

was

built
,

,

of

words.

on

°n

specula-

Basically,

must

also

be

s00160^ taking

o

Aubrey G. Lanston

FRESNO, Calif.—John A. Fries

a

good

has

a

good

Walston & Co., 1157 Fulton Street.

been

added

to

the

staff

of

The stock market is no different
than

life

itself:

It

doesn't

offer

security—but it does offer oppor-

The sole question is whether the tunity.

& Co.
INCORPORATED

15 BROAD

ST., NEW YORK 5

WHitehall 3-1200

speculation.

Joins Milton Powell
PASADENA,
Glassford

has

Calif. —Jack

,

_i.L|iJJi]

with Milton C.

rity Building.

231 So. La Salle St.

E.

become

connected

Powell

Co., Secu¬

.
„

^10n

speculation and investment is only
one

investment

tl0ns

business background suggests that a major de-




without

dustrial activity as well as

the

eline is

even

selling on a scarcity
basis. Although cement prices will
be-raised in 1955, the group seems
fully priced and I'd wait for a reaction.

future

indicate

new

Authority announced

Due

unless there should be im¬

nouncing the terms of

maturity

yarn,

Earnings

,

If the FRB index

?i?e rf

did

U. S. Steel
$6.25 this year after
per share depreciation

highway

new

rector of the

that there will not be any

now

has

Carl A. Bock, Executive Di¬

Nov-23-

small.

very

$12,500,000 electric

of

long-term issue of Govern¬

which

example:

vestment trusts.

a

The

needs

no

been expecting.

so

the past year, industry's
inventories have declined about

is

securities
had

securities

outlook.

the

of

bonds of the Puerto. Rico

Resources

De&l

Treasury offered holders of the maturing Dec. 15 issues

under-capacitated

depression

The

$9

about

meet

Treasury Offer Favorable
V The

Building—In view of the indus-

tries which have undergone
1955.

earn

be

Authority

Authority

14,

and in

predicting.

the forseeable future,

bonds in

ment

will

;

been scheduled for
Tuesday,

offered

was

into the market for

come

near

to

seems

will

issue

Water

portant changes in economic conditions.

try's overall economic importance,
The cement business is basically

(4) The prospect that the indusvate

This

been

bond

new

reports

are

borrowing in the

new

purposes.

sharply

uo

of public works also will increase.
The building boom is a key factor

the

Treasury did not

building plus other types

and road

in

For

may

the

market

maturing issues and, accordingly, it is indicated

time, and there

ing the market
for

—

and

Govrnment

realistic one,

a

had

longer-term Government securities which

aggressive depressant.
(3) The prospect that new construction will exceed $37 billion

an

securities

was

An

was very

revenue

the

"package deal" which

market

money

the amount of attritition

selec-

Program Ahead

do

passed

be largely offset by in-

Government

The

1949

(2) The prospect that the major
impact of the cut in government
spending already has been wit-

attention

Don't forget, stocks

era.

What

stimulant,

from

nessed.

tive

under

prop

a

the

the holders of the

The

in

better-

of

cline to $25 billion from this year's

the

what

short-term

that

The

tone

of the year-end maturities

with

line

appeal. For exampje> many industries that suffered

command

it

ample evidence of this.

to holders

than-average

(1) The prospect that industry's
capital expenditures may only de$26-$27 billion and the 1953 peak
of $28 billion. The drop is so small

is

as

a

good stock.

a

in

are
market

the

time is

any

dous pressure
haven

for

Resources

i

n

-

Bond Sale Scheduled -

refunding operation by the Treasury

received, and the improved

at this

temporarily

area

The December
well

rather

little early to discount that hope;
more
definitely constructive de-

Governments

on

By JOHN T. CHIPPENDALE, JR.

may

require correcting in that: (1) The
election results were the excuse

has kept speculation from becomI

weeks

Reporter

45 Milk St.

CHICAGO 4

BOSTON 9

ST 2-9490

HA 6-6463

30

The Commercial and Financial Chronicle

(2166)

enced

—

has

been

always

con¬

structive.
Act

of

tne

facilitate

shall

and

and

exports

imports and the exchange of com¬
modities
between
the
United
and

States

other country or

any

agencies or nationals thereof.
According to the Act it is the policy of the Congress that loans of
the Bank shall offer reasonable
the

1

assurance

of

repayment and that

in the exercise of its
shall supplement and
and not compete with
private capital.
Aware of the problems facing
United States exporters and of the
the

Bank,

.

Situation

Present

what of the present situa¬

And

tion?

As

civilian

resumed

been

governing the opera¬
Bank provides that
the Bank shall assist in financing
The

tions

The

which—even when

counsel

critical

Export-Import Bank

and experi¬

assisted by j our wise

production has
throughout
the

world, the United States exporter

again, and for the first time
since 1939, faced with active and
effective
competition
in
world
is

We have moved from a

markets.

to a "buyer's" market.
meantime, the productive

recognize that the commercial bank or other finan¬
cial institution instead of making
the United States is
the purchase with public funds.
almost
the
opposite of that of
These
case-by-case
or
indi¬
many
countries which are our
vidual
transactions have proved
competitors. For example, it is the
constant problem of Great Britain helpful for many years and should
continue to constitute an impor¬
to
sell
enough abroad to earn
tant field of the Bank's activity.
foreign exchange with which to
In addition,
however,. the Bank
purchase the food, raw materials
and
even
certain
manufactured now proposes, witfiifr the field in

required to support a
large population on a small island.
products

promote

capacity of our industry has been
greatly expanded so that we are
dependent more than in former
times upon the retention and ex¬
pansion of our foreign markets.
It is the United States exporter
that

is

ance

of the

again seeking the assist¬
Export-Import Bank.
situation

this

In

it

is

not

sur¬

prising that we again hear the sug¬
gestion that we adopt procedures
with

identical

those

in

effect

apparent that many of these sug¬

the Chairmanship of
Senator Capehart, conducted, dur-

gestions are made without a care¬
ful
analysis of our own trade

other

exporting

countries.

}.^ing the past year, studies of world problems and without due

goods on
they will

It is

recog¬

sale

the

currencies

can

sell

abroad
its

it

that

so

is

The

Britain is to sell

purchases

lem

countries

of

food.

them

of Great

to

countries to

that

problem
enough

increase
Our prob¬
importing
the dollars they
may

abroad.

assist
earn

the

must have if they are to buy more
of

exports.

our

in

importance of improving our for¬
eign markets, the Banking and
Currency Committee of the Sen¬

of consumers'
relatively short-terms,
more quickly
acquire

the

It

is

for

this

reason

that the

management of the Bank has al¬
ways questioned the advisability
of establishing in the United States
system

a

ance

of export

credit insur¬

which would provide general

trade conditions and of the opera-

nition of the fact that the under¬

tions of the Export-Import

lying causes of our problems dif¬

in

'

Some of you

Bank.

served on Advisory

and

Groups

placed

more

many

think

I

we

can

competitors.
that

agree

the

a

Except

circumstances

the

that

export trade of the United States

of United States trade dictate that

is

assistance' from

was

witnesses at

as

studies

there

introduced in both Houses of

the Congress and enacted into law
a
bill which among other things

placed
Bank in

the management of the
a bipartisan Board of Di¬

rectors, appointed by the Presi¬
dent with the advice and consent
of the Senate, and increased the

lendiqg authority of the Bank by
$500 million. The reports of the

handicapped by a lack of
desire
for
our
products.
Our
not

problem concerns the ability of
our
potential customers to pay
for those goods — to obtain the

exporter

natural
us

resources

which

supply

abundance of food and most

an

of the

dicated

industry.
Accordingly,
as
you ate well aware,, the volujne of
our
exports continues to exceed
the volume of our imports.
Al¬
though we have recited all of the

clearly the intention of
Congress that the Bank should
actively promote the interests of
United States trade, but that it
the

should

do

with continued

so

due

raw

materials required by

our

regard to sound credit and bank¬

usual phrases until they have be¬

ing principles.

come

The

'

period of the Bank's opera¬

on

public

this selective

funds

be

basis

still

hackneyed and trite, we are
to forget that there

prone

for

exporter

an

or

on

case-by-case

a

assistance

finance

to

prospective orders. After
has established a position in

he

the

appropriately ex¬
credits on a case-

market,

he

other

In

apply for

may

'W"-

line of credit.

a

..rt.y--.

((

words, it may be said
both questions that
consider any bona

in

the Bank will

credit

it

to

this type.

of

number of additional

reply

fide

Affords

for

a

line

of

It

porter

are

a

which ^the

information

credit

require with respect to
This should

ex¬

pedite the presentation of appli¬
cations by the exporter and the
decision by the Bank with respect
to each such transaction.
'•
*
;

a

It is

anticipated that actual op¬
under
these
lines; of

erations

the

to
supplement and complement
fact, the contrary is the exporter's own resources and
true.
If, however, public funds other private credit available to
available
to
the
Export-Import him.
Bank are used to finance thfe, ex¬
This procedure is not entirely
port of those products which will nejtf to the Bank. Somewhat simi¬
assist in the development of the
lar* lines of credit have been ex¬

on

tion regarding the exporter's past
operations. At the same time,/the
exporter will be aware of the type

exporter. Existence of
line, however, will enable

In

transac¬

handled

port Bank will have full informa¬

than

a

all

though

even

of

ex¬

an

case-by-case, rather than an au¬
tomatic basis.
The - Export-Im¬

not

of

line1

a

of value to

be

can

each transaction.

will

business

the

that

believed

is

Bank will

portion
particular

of

a
particular ex¬
purely speculative

a

tions thereunder

a

be expected to finance more
a

of

use

on

credit

applications.

credit

a

basis.

Private Credit

Such

as

credit commitment, but

a

the

porter

Supplement to

a

transaction

potential

the Bank will not set aside funds

of
Bank

to

basis for

before

consideration

under

and

It has

States to export one product than
another.

apply

actual

basis, to extend lines of
assist exporters to fi¬
nance the sale of capital goods of
a productive nature. This proposal
has been the subject of careful
study and discussion between the
Bank and representatives of trade
and financial groups. It contem¬
plates the establishment in favor
of an exporter of a line of credit
based upon the record of his past
operations.
I am happy to report that this
matter has gone beyond the dis¬
cussion stage. The Bank has now
authorized the first two lines of

basis, the facili¬ such

ties offered by the Export-Import
Bank are comparable to those ex¬

is no—but such

must

expopter to know the extent
of aid he may anticipate from the
tended under any present system
Bank over a given period arid thus
necessary dollars to buy from the of export credit insurance offered
permit hirn rationally to plan the
United States not only what they
by other governments.
extension,
where necessary,
of
desire but what is, in many in¬
The idea of selective financing credit terms to
foreign dealers or
stances, essential to their eco¬ of
exports is not based on any customers. Moreover, a line of
nomic life.
premise or implication that it is credit from the Bank can be ar¬
We are a nation blessed with more
important to the
United ranged and used more effectively

Committees and the discussion in¬

-

could

swer

credit

to the type pf goods sold
particular market.

either by

letter or
the hearings.
Following those

exporters without
previous records barred frorh the
Bank's assistance? Again the an¬

by-case

export financing without adequate

their views before the Committee

'

tend

it

regard

fer from those of our

which

part of his record.

as a

Second—Are

of

To the extent that the British can

the

recognized

must

We

problem

"seller's"

encourage

under

exporter who had received

In

functions,

ate,

merely permit the

States

Trade Assistance Program

Of the

Thursday, November 25,1954

United the exporter, without recourse, a but the exporter must present
or
portion of the obligations of the evidence of additional firm
a
loan from the Bank to make a foreign
purchaser. The Bank is prospective orders on a case-bycase basis after be has utilized the
sale abroad at the expense of the always prepared and,., in fact, pre¬
exporters who did not obtain such fers, to guarantee tne obligations line of credit. In following years,
for
loans.
purchase
by the exporter's these additional sales would be
would

Continued from jirst page

t-

...

credit

will

able

in

ment

1

out

other

or

by

suit¬

selected by the
Sales eligible to be, fi¬

should

nanced

cash

provide

of

for.

least

at

pay¬

20%

of

invoice value before delivery

the

of

banks

institutions

exporter.

the

carried

be

-

commercial

equipment.- The exporter

must then
carry not
less than
25% of the obligations of the for¬

eign importer for his own account
with the

or

mercial

assistance of

bank

other

or

a

com¬

financial

institution.
The
Export-Import
Bank will then -purchase without
of the foreign country, tended to assist
recourse, to
the exporter -up to
.groups of manu¬
that country will be able eventu¬
facturers in the iira ch i n e tool 75%
of the obligations of ,the
ally to buy and to pay for not
industry. These- revolving credits foreign importer or will - guar¬
only our capital equipment but have
operated successfully and antee payment of the obligations
,

economy

tions has been one Of varied and must be a direct relation between also the many other items that go
rapidly changing conditions.
It the volume we buy* and
the to make up a high standard of
has operated .through a world¬ amount that we can sell.
living.
V
wide depression, a world war, and
The management of the Bank
Bank
Strives to Maintain
a period of large scale-reconstruc¬
has always recognized the fact
Flexibility
tion and economic development.
that the alleviation of our trade
As in the past, the Bank will
During that period the United problems cannot lie in the mere
strive to maintain a flexibility in
States exports of civilian goods
extension of credit to all who seek its
procedures to the end that it
have increased from a total of $2
if! Unless the products financed
may be readily useful in meeting
billion 133 million in 1934 to $12
by the Export-Import Bank future
requirements of our for¬
^billion 264 million in 19,53. Our strengthen the economy of the
imports have risen from $1 billion importing country and thus ulti¬ eign trade.
It will continue in appropriate
636 million in 1934 to $10 billion
mately strengthen its ability
-

without loss.

The creation of such so that they may be purchased by
however, is not practicable a commercial bank. The ^obliga¬
or
appropriate for suppliers of tions carried by the exporter must
most types of equipment. ~
have the same maturities as those
m *:

groups,

.

...

969 million in

1953.

These changing conditions have

dictated from time to time varia¬
tions in the type of assistance

buyer cannot

pay

abroad when the mutual interests

his debts.

the beginning
1939, the great ma¬
jority of the loans of the Bank
were made at the request of the
United

"selective"
basis.
exporter and for credits on a
enabling him to That is to say, it has directed its
meet
competition from abroad. assistance generally to the financ¬
During this period a relatively ing of those projects and to the
small number of loans were ex¬ export of those products which

f

tended

of

directly
purchasers.

the

to

With the advent of

war

foreign will assist in the development of
the foreign country and enable it
to earn or, in some instances, to
in Eu¬

the United States exporter
and, for him,
unprecedented era.
He had

rope,

entered upon a new
an

practically no competition and
the demand for civilian goods far

save

dollars

to

the

mutual

ad¬

vantage of trade between the two

goods and products.

Credits

extended to governments

were

and

to

private entities to assist in fi¬
nancing capital equipment lor ^de¬
velopment programs which would
stimulate the production of stra*:

tegic materials • and otherwise

aid

the

ef¬

common

defense and

fort.




war

States and friendly

be thus served.

'

problem of the

Bank, however, is to offer effec¬

by-case basis for assistance under
the line

sales

in

markets
in

abroad.

conditions

trade

from

The recent shift
of

a

international

"seller's"

to

a

"buyer's" market, the increasing
importance of export markets to
United States manufacturers, and
the competitive terms offered by
foreign suppliers based on assist¬
ance
provided by their govern¬
ments, have made it desirable for

the project or product must itself
directly produce or save the dol¬
lars required to pay for it. It is

mately, even though indirectly,
improve
the
foreign 'exchange
position,of that; country.
During periods Of acute- dollar
shortage * in * a1 particular country
it may be necessary to .limit as¬
sistance from public funds, to the

any

of the line without prior approval

by the Bank of such transaction.

the Bank will

designate from time to time the
countries

in

transactions

which

exporter

the Export-Import Bank to adopt

mean

on

assistance

States

procedures

to

expedite

tension of assistance to
of

sistance

cific

in

connection with, spe¬
Each prospec¬

transactions.

porter
amount

in

given

a

of

credit

the

country,

which

mav

be

vary according to the nature of
the equipment to be financed and

to

extent

some

lieved

the

ceed

terms

and

shorter

than

competitors.

For

seven

years

sary.

The

or

may

time to

that customer.

The

Bank

automatic

use

will
of

a

authorize

not

line of credit in

ing

of

Would

sales
not

to

be

such

barred,

a

Country

but

it

so

desire

It should

which

any one

not

ex¬

should

•

be

offered

-

by

types

of

some

be occasions when

will

to

credit

com¬

is ^be¬

three

or

years
w ill
be adequate.
For
others, terms of about five years
may be required, and for large
units of heavy equipment there

sible

of

It

equipment terms of two

riod.

amount

.

those

the

outstanding at

the

should

usually

.

cessive terms

be

with

petitive terms offered.

outstanding at any one time. Upon
receipt of appropriate credit in¬
formation regarding a particular
customer, the Bank will designate

the ex¬ a
country suffering severe dollar
exporters exchange "difficulties. The financ¬

capital goods without sacrific¬
ing sound principles of-finance.
It has been the practice of the
Bank generally to extend its as¬

.

..

to
the
United may
be financed
automatically
in his efforts to and, based upon the minimum or
maintain and further develop his
average business done by the ex¬
tive

of the .obligations purchased or
guaranteed by the Export-Import

Bank.
After., approval
of a line
of
;,
The maturity of the paper to be
credit in his favor, the exporter
purchased or guaranteed would
can make
application on a case-

For these exporters,

that

countries. This does not

exceeded the supply. During: this
sufficient that the incorporation
period it was not the exporter but
of the product into the economy
the .foreign
buyer who sopght
of the other country should ulti¬

credits from the Bank to finance
the
purchase of United States

can

immediate

The

of the Bank
has, therefore, found it necessary
to follow a policy of extending
management

States

the .purpose

nations

Credits

The

United

of the

A "Selective Basis" in Extending

of the war in

a

friendly
to
country. Where the nature of the
cases to extend credits to finance
earn or save dollars, swe will only
goods permits of repetitive sales
United
States
equipment
and to the same customer
be
piling up instalment credit
abroad, pro¬
services for development projects
until a point is reached where the
vision can be made for utilization

which the Bank has been called
upon to.extend.
From 1934 until

Exporter's Past Operations,
Basis for Credit

will

terms

will be
to
be

of

neces¬

extend

ex¬

minimized,

is

believed, because the
will be required to
ticipate ratably for the full
porter

ex¬
par¬
pe¬

generally be pos¬
through - private

finance

channels
products
for
which
credit terms of less than one
year
are

appropriate.

The Bank proposes to

commission
chased

or

on

charge

all obligations

a

pur¬

guaranteed by it.

The

each commission,,.payable by the

^ex¬

transaction should, be-. Subject to. porter when the Bank assumes
careful study and prior approval ^responsibility, for the
paper, will
of the. Bank.
be 1 % % flat on obligations

hav¬

The fact
that these lines of ing a final maturity of three years
has been
joe less, and will be increased by
..the subject of an individual. ap¬ credit are based -solely upon the
record of the exporter's past -op¬ at least Vz % for each year ;or por¬
plication to be approved or dis¬
erations immediately raises two tion thereof by which thermaturapproved on an ad hoc basis.
ity of the last maturing ^obligation
questions.
export of those items which will After consideration of all risks of
"
First—Will the Blnk assist an exceeds three years.
make a direct and early contribu¬ both a commercial and political
In
addition, the Bankv will 're¬
tion to that country's dollar ex¬ nature, the Bank in appropriate exporter only to thejfcktept of his
change position. Any other course cases has agreed to purchase from past business? The answer is no— ceive the interest collected on the
tive sale by an exporter

Volume 180

Number 5380

.

.

The Commercial and Financial Chronicle

.

(2167)
notes which it

by

purchases,

the

guarantees

note

commercial

a

if it

or,

Continued

bank,

the

borne

by

in

the

obligation

one-lcurtn

and

at

■.

■

.

the

and

in

was

exchange of goods
made possible, even thougn it

within limited areas.

19M-

volved

products in which world trade has

credit,

their

but

sales

have

abroad

indicated

Then there

on

de-

a

anty against certain so-called
litical

risks, such

inconvertibility,

the

as

since

third group of

a

1900

by leaps
These items include

grown

sire that the Bank issue its guar-

was

bounds.

risk

war,

.

exporter and the foreign importer, " trade in all these items was only
In
any
situation in which the about 14% of world trade. By 1937
Bank would be prepared to
carry it was up to 36% and in 1950 to
both the commercial and polit cal X over 40%. And if
you take a still

transaction, it would be

a

prepared

well to limit its

as

of

trade

cov-

controls.

rency

production

themselves out. The postwar tranis clearly drawing

in

an end
and we must expect the
tasks ahead to be different iust as
the pattern of trade
be

ent. Countries which

promise of further
One

among

can

wilf

out

understand

some

fears of foreign countries

Trade with Can-

to stick.

with

trade

the

dollar

area

*

of the

concern-

countries of Latin America also
has shown remarkable vigor and
which stability despite competition from

closer look at the products traded
come

you

across

fact

a

on

tions are basically complementary.
That is why trade increases over
Third, they the lonS ran- The countries that
countries as pos- bave increased their exports and

trade.

want as many
sjbie to act at the
the

pros-

that' other countries will trade
more does not mean that we will
trade less. The emphasis often put
on trade competition should not
obscure the fact that trade rela-

Second, they realize that

restrictions

d"fto-

were

trate for many years are now recovered and taking an active part
in world'markets. But the fact

progress.*

ada, by far our leading trade part- there would be little point in rener, has risen in line with Canada's -moving restrictions on
payments
sensational postwar development, only at the cost of putting more
Our

dif-

to

of

the so-called dollar area countries |ng convertibility. They do not
has been based not on the exist-< Want to act
prematurely; when
iron ence but on the absence of cur- the move is made,
they want it

cancellation - tus, agricultural equipment,
of an import permit, or other act and
steel, and petroleum products,
beyond the control of both the At the beginning of the century,

risks of

rise

the

course,

slowdown

tor vehicles, industrial machinery,
of/electrical equipment and appara-

po-

a

But if world recovery
continues at its present pace,
many
of these, difficulties should iron

their .Payments deficits holds

-

.

having

ficult time.

sitional period

In the Western Hemisphere, of

and
mo-

.

areas our traders are

the

A

^

individual countries and the general reduction or elimination of

Trade with Western Hemisphere
v

services,

substantially

ahead.

great expansion

multilateral

proportion

same

in

was

1900

trade

Some exporters are prepared to
assume all commercial risks in-

and

decline

reserve
accumulations by
foreign-countries is already
noticeable. On the other hand the

,

of world

years

seme

-

for about 25%

•

in

goods

n.ay

the

in

Via New World Tiade Patterns

of 5%.

excess

military

in

interest

any

of

Ex¬

x

of

5

page

which

port-Import
Eank
willT receive
2% of the first 5% of interest
least

from

purchase

ior

31

Put

time when

same

their international payments

Obvi-°rder are now building up their
.political seems to me to be even more strik- European suppliers. We are shipously, each country must decide import demand. They are beginrisks involved.
The coverage in ing—namely,
that at least one- ping these countries more indus-f0r itself when it is
ready to make nin£> in a small way, to close the
such cases might extend to 85% half of world trade
today is in trial equipment, trucks, tractors, this very important
move, but I Wide SaP that has existed in the
of
the-financed portion of
the products that were unknown at highway
equipment,
and
drugs think we may be allowed to
hope postwar years between their ecotransaction and the cost to the me turn of the
century.and chemicals than ever before, that such action will be
pushed nomic status and that of the United
exporter would be somewhat less .I
want
to
States. They will be customers of
stress
that
these
.^be basis of the figures that*- as hard as is practical.
™
than coverage for all risks.
ours
for products they could not
changes in the pattern of trade are in so far our exports this year
Increase
in
Europe's Trade
are
going ,4$ almost daily.
buy heretofore. This is a devel¬
We to the Latin American dollar count Bank
Should Not Discourage
to

erage

the

so-called

have

Private Capital in Export Trade
T
-

.

It

is

,

.

.

Import .Bank
wnicn

it

that

oilers

makes

not be

the

to

for

States

which

assistance

its

mance our

shall

to diseour-

as

of private

use

facilities

United

attractive

so

the

age

.

the charges

exporters and
i(

,

the intention of the Export-

capital

loreign trade.,

to

lo the

contrary, it is the purpose of the
Bank

age

to

the

supplement
use

ol

and

Priva^e

encour-;

capital for

*u™ermore?4t,is

enced

0f

1

*****

thankful.

which

It

^onal
to

shadow of

a

'twenties.
to

The

detergents

market
New

With

Without glossing

the'

for certain

fats

oils.

and

produGfe ranging from plas-

tics

we

should

be,

increase*^

promises

the dan-

over

_

_

..

artificial fibers, interna-r-gers of too much regionalization
trad# in silk has dropped of trade, I think we can see how

antibiotics

to

have

entered

the market ^successfully.

«

-what this*points to is that
fiexib]e

the

encourage

for

opment

Meanwhile, the boom in Western

<

rise

py^tne Export-import Bank shall;
be such as to
ox

taken.

Europe shows no indications of political stability for our Allies,
having spent itself, and a further It promises more stable trade.
increase in Furooe's trade seems Moreover, it promises an expanto be assured. All over the Con- sion of trade in which I am confiwhat it was in the beneficial some of these develop- tinent,
producers are beginning dent we will share along with the
switch from soap ments have been. Since 1948, the to wake up to the possibilities of rest of the Free World,
has
changed
the year of the currency reform in the mass market. The demand for
I have tried tonight to stress the

and. substitutes.

thetics

finally

Seems Assured

(rode in rubber, textile Jfies .W1*„ be considerably better
andfiother products influ- than in 1953 and close to the 1952
by ^ development of syn- record-

ex-

porting1 countries

''CxvBnsion

is

seen

fibers,

unperatrye tnat assistance offered
not

step

must keep as
as>possible and - adapt

themselves

to- produce

**

what

the

Germany,

world

trade

has

risen

by 40% but intra-European trade
has doubled. The British and

our-

selves tend to look on Germany
simply as a rising competitor, but

goods, household equipbicycles, and similar
goods has so far gone largely unsatisfied because other things had
to be attended to first. But now
consumer

ment, cars,

I think it is plain that the come- the consumers' durable field is
back of Germany as a producer finally coming into its own. The,
has strengthened the whole
■*

*

***

**

econ-

large

**

1

expansion^ programs^of the
'

^

■

~

—n

^

fact that international trade is for-

-changing.
Three
hundred
ago, spices were one of the
biggest items of world trade. Two

ever

years

hundred
nated
years

years ago, sugar domithe trade scene, and 100

the most striking

ago

fact

was the outflow of textiles from
~

extension

too

are

long
ailllFJ>y

fife?
trade

unrestrained^
the extension of

petition m

corn-

foreign competitors
-

v

7

ior

the, the trend,;

^rr.

^ the

lines in which demand

or

competing United States.

exporters.

—

credit,

exporters

their

-

beUer customer

a

is be-

^hetherUnited.-;States
that competition
between

~

but because she was slower in* raw materials of the sterling area.
I,only wish that we could count
sbifting ber
production
to
the and'also a better cash customer > as>.eonfidently on. improvment Kn

.

and

wcia

iinent

thanv

Y; Y:^Y.:\Y:

tbe

gince

rising.

was

bas

sbe

war.

worked

hard

tQ
up the ga
tbe game-s true of France

Much
Qn tbe

other hand, Germany, Switzerland,

for "many of

agricultural

our own

products and manufactured goods

good

_a

creased

exampie

regional

how

of-

trade

inlead

can

Japan. When I visited that
try last spring I

coun-

much
impressed by the accomplishments
and the frugality and hard work
was

very

c-f the people. However, I am worBelgium, and the Netherlands rose
So
much
for the
past.
What ried about the problems Japan
yersations in Europe with officials in
importance as exporters because about the future? We know that faces today, and I hope that the
responsible for the operation in
they produced goods for which a great potential demand for good« Free World will find a way of
their/ countries of \ agencies
enthe markets were expanding. ; '
exists and that this demand will helping the Japanese people to
*£ achvities similar to those
Even a better example of this rise if only because the popula- solve these problems. In the long
of the Export-Import Bank.
It is,
flexibility has been the expansion tion of the Free World is increas- run' fhe most favorable developunderstood and assumed that
each; 0£
S. exports. The story of the ing at an annual rate of almost ment for Japan would be a rise in
Will
'

I have just returned from

-to increased general trade.

con-

for-

own

changes in our export trade struc-r
ture is fascinating and does credit
the Yankee spirit of inventivepossibility of ness and
adaptability about which

eign traders as best it may. With—
out exception,
however, all - are
concerned, at

credit

by

in

the

volved
sound-

by

the

extension

of

excess

nature

that

of

justified

the

of

goods inby the application of
principles of finance.
In
and

country

every

tales

the

for

pressures

of

exporters

favorable

.their

terms

granted

competitors

Some

of

true.

There

these

however

recount

is

that

abroad.

reports

be

may

evidence;
buyers, desir-

the

of playing off one source of
supply against another, have not

ous

been reticent

exaggerating and
perhaps even inventing such tales
to

induce

favorable

more

on

credit

offers.

to

Latin

Pfs ag0

haVe

products

those

u

went

biggest trading area,
with one or tw0

our

40

or

not

been

able

to

particular

goods
for
years, but have nevertheless adi
jugted their businesses, brought
.

a

products and prospered

new

resuitJ Gdfllg

as

farther back,

even

there is the^lassic example of the
New

Engia„d

than

a

who

trader

himdred

more

ag0

years

was

seUing ice to tropical countries in

to

parts, of

many

market

extended

competitive basis

a

America,
30

who

traders

little today,

in

Unrestrained,

solely

gome

some -

.

bear perhaps too

we

p

^ars

the

worlds The

forr American

ice

disaplong, sinCe, but about 30
ago w began to sell electric
* refrigerators abroad, and
are going into household

d

obtain orders at any cost can serve
no
useful

£nd

do

n0w^we

nothing in the long

but de-

freezers

purpose.;

stroy

those

those

who

who

u

It

can

run

extend

+

accept

it.

it

and

Credit

ex-

tended, however, with due regard
to sound

principles of finance and

in

have taken the lead

and

of

exports-

air-conditioning

*

and

restrictions.

Trade

the

cbaracter

prime

require-

of

manv

the signs

"world's
worlds

markets
to
markets,to

the
tne

benefit of all countries.
:

mutual
mutual

I submit

that by adhering to such

a

course

bv countries.

vested interests which will be

diffjcuit to
nhlv

a

it

overcome

nece^arv
"

was

prob-

If the ster-

evil

ways of ralsin^ living standards,
course, the

JPPterials has provided new trade
0pp0rtunities, and the fact that

key to multilat- (our own economy has held at a

eral trade and to free movement high level is an additional source
P

£

/vf

4-L

C;<v\

yy

n w\Ai i

vit

4 V*

n

assist

the

efforts

...

engaged
nance

of

the

to

in

.

Bank

of you
!
,

best

can

who are
,

,.

foreign trade and fi-

serve

United

well

the

States




interests

ling

area

had

not

been

able

to

operate as a closed currency area,
and

if

Unkm

the
had

European
not

been

Payments

^

up>

the

countries involved might have had
to

resort

to

barter.

As

it

was,

and it will be

anr

jol
to lead in developing these products and techniques and bringing
them to the world outside. Non#
of us can say just what new pat-

and

the

steam

pioneering

our

_1.

_

li

research all
a

foreign gold and dollar

re-

1949,

and

that

in

the

last

four

offered

i.l_

over

tc

_

i

i

promising

to

_

l_

revolutionize

gams
our i

industries and enrich our daily
lives. I am confident that we wili

meet this challenge
we

will

as we have

previous periods tliat'
adjust to new patterns

serves.
These reserves are now years combined we bought slightly
around $24 billion, or some $9 bil- more from the area than we sold

and new demands as we have done
in the Dast. The future holds high

lion

promise of trade expansion based
on
rising production and rising

larger than at the time of the

general

currency

devaluation

•

in

1949.

Y

up

the

reserves

partly through

were

American

economic assistance and purchases

,

Conclusion

few

living standards everywhere, and
in that expansion our pioneering
mistic but which I think are also enterprise will yield us our rightrealistic. I know that in certain ful share.
I .want-to

However,

built

there.

conclude with

a

statements which may sound opti-

.

the world, such

vast flow of technological

particularly in view of the build- have risen ,m every year since met those of
UP of

engine

countries

nearly 200
years ago. Never before has there
been such an immense amount of

t

-

the Export-Import

change

bfved

The most important

opment has resulted in rigidities

^

to

products

new

are

of capital lies in convertibility of .of. support. Since the amount that
Dortine countries to accelerate the 'of these has been the growth of currencies
Like many of you I Latin America can buy depends porung countries ,to accelerate tne
regionalization
which has h°Ped that at the meeting of the fbasically on how much she can
development of their resources
roo^s especially in the mone- International Monetary Fund last sell, I would like to point out that
can serve as one of the most usetary disorganization of the early September we might receive some (our imports from
the 20 Latin
ful instruments of expanding the postwar years.
While this devel- encouragement in t hi s respect, American Republics
asa^hole
permitting im-

continue

to

T

_

for the purpose of

will

response

terns of trade will be opened, bu
i refer you to the technological
advances made in recent years, for
example in electronics and syn^
w
?etlc chemi8try- and ^ the great'
bilt f y.et hardly explored field
a
of atomic power. Striking adSf fntlrnSal paVments As of; eertain Latin American coun- vances have also been made in
conffdence n local currencies has tne+s !n controlling inflation and some less publicized fields such
improved tL tendency to over- restoring confidence in their own as materials handling and automnort hks^ lessened texes
have «urrencies.
This is exactly what matic, controls, where, the U. S.,
be?n eased and saving has re- has been d°Se wlth gr€at sufc4ess-as in many other aspects of mass
As a result these countries ^ •sev.eraJ, European
countries^ production, is the unquestioned
h^ been abfe to go a long way ,ev6n lr\ Greteca' wbl(:b sufferad leader of world industry,
towLd Ugh tin ing quantitative frdm a devastating civil war until All these developments are ereSere^
onlyaboutfive years ago. The ating innumerable new openings4
consols We^ can hope foffurthlr world situation holds considerable for countries that are willing to
1?ogreSs awav from economic na- ^Pfmise for Latin America. Prices move ahead. In atomic power partSSiSiand^also alay frol re- of some products have fallen from ticularly, we may see opportunigionalism which in the long run
J?eaks ,°Ltbe ,^rea" boom' ties comoarpble to those that the •'
are
inefficient
and
roundabout
invention of the spinning jenny

paraiieied by

changes in the distribution of trade
®
»■

in

*

." V,

me^
area
*°
favorable In Europe orthodox fiL made pohtically stable and secure,
fj0™"1^monetary measures^^^imed ^hllAe ^ohle^s also f*18* in
g the^ control of tofSSon along Latl" America I personally have
^^the general expansion 'of pro- feat fa.^ £ +the futu//
duction have made pofsible great irade ^ that ^
W
progress toXLd
sounder pattern depend, of course on the success
Happily

u,ri«cr

.

have6 been

o{ trade

This is also the

:

quite the

opposite.

greater interchange of goods between Japan and those countries,

continuing economic progress
continuing release from con-

trols

example,

but it has not reduced, the inter-

national;flow of goods;

of
and

fox;

not
collapse, for new products
win take the place of the old. Industrialization has greatly altered
the composition of world trade

productivity and purchasing power techniques,
°ver all of Southeast Asia, ana a

make,

textiles,"glass bottles,

paints, shoes and cement—even if
they grow more of their own sugar

However, trade expansion will require a foundation

million.

20

pmrinment»

cban

own

and wheat, as has been happening
recently—international trade will

.

attempt to assist its

future

their

32

The Commercial and Financial Chronicle

(2168)

Continued from page

dozen

11

I:

or

dry holes it will drill

so

the months ahead.

in

Z off

Well

litt's. way in the same field may
be producing oil and gas together
in a fluctuating ratio.
Also con¬

a

Petroleum Outlook and

sider the

NoncalcuhUd Risks

radically different prices

paid to lease and royalty owners.
How do you strike a fair balance
costs for the same gas

on

produced

competition for consumer

because

preference has continued to oper¬
ate in free-wheeling fashion.
Some
few
interests,
though,
both inside and outside our in¬

the

dustry, have made integration

point of attack on a limited num¬
ber of companies.
The Depart¬

Justice, for example, has

ment of

suits

pending that ask for a
oly. Since competition cannot act from the same field let alone the
segregation — a forcible divorce¬
to govern price in the case of a cost in other fields in other areas?
ment—of the marketing phases of
line get the corr;^jtltive advantage
monopoly, it is necessary to in¬ Frankly, this problem defies solu¬
the industry from other phases.
stall a governor in the form of tion.
of relatively lower cost transpor¬
Government lawyers are actually
The
Federal Power
Commis¬
tation? We know the answer to regulation, state or Federal. Be¬
asking the courts to set aside nor¬
that from experience.
When one yond that, it is possible to estab¬ sion could, of course, simply de¬

.petitive companies stand by
watch those with access to that

large-diameter line was built from
the Rocky Mountains area to the
Midwest, two other lines were
tmilt soon afterward.

short, the increased efficiency
rord consequent lower costs
reIn

.nutting from the rapid building to
provide the security cushion must,

by the nature of our competitive
.society, breed further building.
We can't, then, be concerned com¬
petitively only with the first mil¬
lion-barrel
cushion of
capacity
already has been built. We
recognize the competitively

Ihat

should

impelled additional capacity that
will be built as the various com¬
panies seek to reestablish their
competitive positions,
j
r
,During the period of transition
to reestablished equilibrium, we
are

going to face abnormal risks
business because of build¬

termine to hold the field

fields—though the regulating com¬
missions don't always do it. It is

able

the lowest conceiv¬

natural gas to

Such

level.

price of

a

course

opens

possible because the cost in each some interesting—and frightening
case can be determined by objec¬
—possibilities:
tive examination and the regula¬
(1) The artificially low rates re¬
tions can then be designed to cover sulting for the consumer might
cost plus a determined percentage stimulate the demand for natural
of profit on investment. State com¬ gas even more than direct statemissions
generally regulate the commission regulation of retail
rates of utilities to cover the de¬ rates has stimulated it in the past.
termined costs and permit a re¬ Such stimulation could lead to an
turn of not more than <5 to 7% on even more thorough replacement
investment. But thus far, I have of solid fuels than we know today.
never heard of a case where pub¬
(2)
The artificially low rate
lic utility regulation has
tended backward to the

been ex¬
ma¬

raw

terial costs of the utility company.
In

the

of

case

the

transmission

the Federal Power
regulates rates to
determined costs plus

companies

Commission
the

cover

almost certainly
would—discourage the develop¬
ment
of
increased
supplies
of
could

—

in

fact,

There would be little
economic incentive to search for
natural gas.

produce them
were accident¬

those supplies or to

when

even

they

ally found.
earning of 6% on capital.
(3) As a result of the combina¬
far, so good—these are mo¬
tion of increased demand and de¬
nopolies that are regulated in the
creased supply we might find our¬
capital outlays in the years ahead.; public interest, and the regulation
can
be reasonable
because costs selves with a serious, even a crip¬
We are also going to have severe
pling fuel shortage in this nation.
•
competition in the dual fields of can be determined fairly easily.
We might have millions of homes
With the Supreme Court's deci¬
quality and price. Our profits will
and industries equipped for using
sion in the Phillips case, though,
reflect these conditions.
only gas—and inadequate gas with
Bear in mind that among the we have been thrust into an en¬
which to supply them.
tirely new concept of public regu¬
many freedoms our industry has
Frankly, this is an intolerable
The Federal
is the freedom to commit economic lation of industry.
situation which, as near as I can
suicide. Self-destruction is a privi¬ Power Commission, said the court,
determine, was never
contem¬
lege—though not a pleasure—in has the power to regulate the
plated at the time of passage of
wellhead price of any gas that
any really competitive economy.
the Act. I do not see how it can
goes into an interstate transmis¬
be cured other than by positive
Bisks Associated With Natural
sion line.
Suddenly we are con¬ action
through clarifying legisla¬
Gas Price Control
fronted with a proposal for the
tion.
Rates payable for natural
Another of the sometimes un- application of utility-type regula¬
gas in the field must be those dic¬
calculated risks of our industry tion to many thousands of individ¬
tated by a competitive market if
in

our

ing "ahead of the market."
We
are going to have continued large

•

lish reasonable rates in these two

has

today

side door

as

through

in

come

the

result of recent de¬

a

the gas in¬

velopments affecting
natural

discovered

gas

reserves

are

by companies or per¬

searching for oil. Hence sub¬
and produc¬

sons

stantial gas reserves

ing gas properties are owned by
oil companies, and the fates of
the two industries—gas and oil—
are

in

large measure twined

gether.

•

T

T

Now we have been

to¬
.

.j

accustomed

£or years to government regulation
«<ptthe utilities that market gas at
-retail and of the large transmis¬
sion lines that serve these utilities.

The
4both

principle

cases

of

regulation in

makes sense, whatever

deficiencies there may be in prac¬
tice.

In each

duplication of
distribution facili¬

case a

economic

mal

behavior,

to

sus¬

ual

sellers

who

be considered
not think

a

cannot

remotely

I

monopoly.

can¬

of a more perfect illus¬

tition

of pure theoretical compe¬
than that of the search for

are

we

meet

to

demands

the

thrown upon the industry.

But in

any

event here is a new risk for

our

industry over and beyond the

natural economic risks of the mar¬

development of natural gas ket. We must weigh it most care¬
and petroleum reserves.
Further, fully in all of our calculations.
the regulation is now
extended
and

backward

the

to

raw

Risks Associated With Threats

materials

of

utilized

by the utilities.
Even
worse, the Federal Power Com¬
mission is asked to regulate rates
for

function in which costs can¬
slight¬
degree of accuracy.
* :
/■*'
a

not be determined with any
est

How

the

Federal

Disintegration

Still another of the non-calcul¬
able risks unique in our

industry

stems from the efforts of some to

defy all economic logic and force
a

disastrous

breakup

into

small

holes

in

a

futile

search

for

oil.

One of the chief of them
has been that of vertical integra¬

ciency.

or

ties would be

economically waste¬

Well Y in the
been

brought

same

in

field may

by

a

have

company

of getting
crude from the ground to the con¬
sumer in the form of usable prod¬
That is, they own some pro¬
duction
or
their own crude-oil

ucts.

transportation
have their

both, and they
products transpor¬

or

own

tation facilities,

their now whole¬
sale outlets, or their own retail
outlets. Producers frequently find
themselves compelled by compe¬
tition to acquire their own trans¬
portation facilities
own

or

even

their

refineries.

Now

all of this

come as a

of

nature

integration has
of the very
the industry and the

consequence

logic of competition.

It has come
because the management of the
individual
petroleum
firms in¬

volved

saw

plies,
level
fluctuations,
13*1

JfOUBCEV

'26

BUREAU OF LA60H

*31

-MS

Hi

STATISTICS. BUREAU OFP1UM.IC MASS, AMERICAN




46

AUTOMOBILE

'it

ASSOCIATION

costs.

costs

a

need to insure sup¬

marked profit
and reduce over-all
out

Inevitably

have

meant

these

lower

lower

prices,

must

pay

gasoline tax to maintain high¬
generally but

ways

toll that fre¬

a

quently ranges from 15 to 25 cents,
per gallon of gasoline consumed.
It also brings complicated issues
of

competition between public and

private institutions for the privi¬

serving

of

lege
needs.

I

other

and

will

factors

toll road trend

trend

motorists*

the

convinced that these

am

limit

toll bridges in

to

run.

the long
.'..""TV

,

In

the

they limited the

as

they will not them¬

ture.

selves

it.

As

result

a

we

this

have

calculable

risk

hanging

heads

the

non-

management

of

the
and

over

not just of one company,
but of this whole industry. It fol¬
owners,

lows, doesn't it, that if one sort of

integration is bad, illegal, then all
integration is vulnerable?
Worse—the

same

risk is threat¬

ening the very consumers of our

For if we are to be de¬
nied the economic efficiences that,
are part and parcel of integration,
products.

increase.

must

costs

then

Indus¬

at a low
level, as the cold statistics demon¬
strate, and so the increased costs
will have to be reflected in in¬
creased prices to the consumer.

another

risk

abnormal

transportation

that
we
do
not
consider
sufficiently is
bound up in the present state of
our highways.
You'll find encouragement for
always

highway development written in¬
You'll

to the Federal Constitution.

it

find

and over
again through acts of the legisla¬
ture, the executive, the judiciary.
But

expressed

all that

for

that

over

everyone

agrees

development

highway

most excellent

Solution

network

must be based

the

of

our

over

pub¬
lic roads system adequate for our
needs. In metropolitan areas, the
economy

on a

of
access
roads
and
facilities must also be
The specific risk we run
our
market for gasoline

problems
parking
solved.

that

is

lubricants

and

lack

for

be

will

curtailed

automotive

adequate

of

mobility.
The Risk of End-Use Control
A last abnormal

risk in

our

busi¬

today is one we have faced
recurrently over the years — the
ness

of fuels.

use

for

industry

our

solve

agitation for controls over the end

The Highway-Capacity Risk
Yet

any event, while toll roads
contribute to a solution of

now

problem of maintaining a true na¬
tional market by maintaining a

try profits already are

is

a

thing, the develop¬

ment itself lags.

Our

industry's growth—yes, the
growth of the total economy—can
be seriously limited unless the na¬

in

for

old

Now

another

we

seem

promotion

to

be

of this

proposal.

I

am

that

sure

end-use

establishment

this

control

our own

petitive

totalitarian

a

the champions of

whether they are
particular branch of

—

a

industry
industry

Federal

or

of

of

Most

people in

advocate of

convenient device for

any sense a

state.

no

considers this in

control

or

or

in some com¬
in the state

legislature—claim

have the best of intentions.

to

They

that they want to insure that
nation
makes
fuller, more
adequate use of nature's bounties.
So they say that premium fuels

say
this

tion's highway capacity is greatly

should be reserved for luxury uses
and more abundant fuels should

increased, greatly improved. Some

be dedicated

of these much-traveled roads

loads.

are

excellent, but many—too many—
are unsafe,
badly in need of re¬
pairs, and the highway system as
a
whole should
be greatly ex¬
panded.
Suppose

what

at

we

struction

terms

in

of

constant

a

purchasing-power dollar and stack
figure against the increases

that

in estimated travel miles.
I have used the average

for the

1921, '22, '25, and '26 as the
minimize the
political influences that affected
highway expenditures. You'll no¬
base period so as to

tice

that

the

road

load

as

rep¬

istics of our economy but it is
becoming a throttling inflence to¬
day. The need for more and bet¬
ter roads has become so great that
private capital has entered the
field to meet the needs, just as it
entered to meet the need for

once

Toll

bridges.

road -mileage

is

growing rapidly.

Is

tions.

there

collection

of

a

justification for

taxes

on

toll

road

gasoline consumption? Will there
be
opportunity for competition
among
petroleum
suppliers
to
serve

the

state

and

consumer?

Federal

Will

the

governments

from their

highway funds provide
the same allocation of building to
areas
served by toll roads as to
other
a

areas?

stepped

up

If

so—and

there

is

building of nontoll

roads—the security of some proj¬
ects

will

be

jeopardized.

If not,

they

fuel

be

say

zones

other variant of the central

notion

that, not competition, but
planning should determine
fuel should be used, where,

outside
what

for what purpose.
Often they make a case

certain

surface

that has

plausibility,

when they dwell on
goal—the more efficient use
sources—rather than the
means for reaching that goal.
But
especially

their

of energy

because they have
through the prob¬
lems of the means that their entire

it is precisely

failed to think

thesis must stand condemned.

Today
it
is
the
interacting
judgments of buyers and sellers in
a free market that determine the
the

uses—and

a

oil offers his fuel at
is

too high,

buy.
the

various
seller of fuel
a price that

prices—of

competing fuels. If

the consumers won't

His judgment is checked by

pragmatic test of success or
in, a competitive market.

failure

A buyer of fuels, on
the other
hand, given his choice in an open,
competitive
market,
decides
whether to use gas, or coal, or oil

in

a

given operation. If he chooses
him the great¬
efficiency in proportion to

the fuel that gives
est net

its

Private-capital investment, how¬
ever, raises a multitude of ques¬

to the heavy-energy

that there
established,
with each geographical area using
the fuel that is most readily avail¬
able to it.
Or they come up with

a

years

Or

should

some

look

we

have been spending on road con¬

,

process

they

by toll
against
not only

ing of the current industry struc¬

tion of the industry, an

tinuous-flow

because
the

served

discriminated

are

the problem,

resented
by
travel
miles
has
increased over the base period by
integration
four and one-half times. Highway
ful. By the nature of things, then, that has made three strikes in a that has gone on in every phase of
expenditures in terms of constant
4i is practical to give to the utility row—but that has to set aside a this business. Many petroleum job¬
purchasing-power dollars has only
reserve
to finance the probable bers have effected marketing effi¬
«r the transmission line a monop¬
doubled. In fact, we only reached
ciency by acquiring retail outlets the
prewar level in 1953.
VEHICLE MILES AND HIGHWAY EXPENDITURES^
or have reduced costs by getting
Our
highway mobility — our
t
••
their own transportation facilities.
\
UNITED STATES, 1921 - 1953
l(
INDEX1
( BASED ON AVERAGE YEARS 1921,192 2,1925 ANO 1926 » IOO>
Most individual refineries are at ability to keep people and goods
moving over our roads—has been
least
partially
integrated
both
one of the outstanding character¬
forward and backward in the con¬

transmission

roads

do

Power

fragments of some companies in
Commission determine the cost of the industry.
the product offered from a well?
There have been many struc¬
Well X here in field A may have tural changes made in our industry
been brought in by a producer over the years as we sought for
who previously put down 13 dry every possible increase
in effi¬
can

communities

the

pend the quest for greatest effi¬
ciency that has led to the build¬

So

tration

dustry.
Most

an

now

Thursday, November 25, 1954

...

price, he keeps his costs low

and

more

can

likely

sell

at

a

profit.
If he makes the wrong
choice, his costs are higher than
those of his competitors and he
promptly finds himself at competi¬
tive disadvantage. Again his judg¬
ment in either case is checked by
the

pragmatic test of success or
in a competitive market.

failure

Under

a

system of end-use con¬

trol

there could

test

and

Instead,

no

some

be no

pragmatic

competitive market.
bureaucrat or group
have to dic¬

of bureaucrats would

tate

on

the basis of

predetermined

Volume 180

Number 5380

...

The Commercial and Financial Chronicle

(2169)

theory

the

the fuels.
crat

allocation

Then this

of

each

of

Continued from page 4

bureau¬

same

group of

monopoly condition would
have been established, would have
to dictate the
price that would be

charged for each fuel.
or

has

group

the

plex

decisions.
that

under

intelligence

And

the

such

ously

segments

the

if

many,

grievous
and

con¬

am

inevitable

dislocate

growth

I

com¬

errors

system would

a

the

us

the

ability to make such

vinced

of

our

seri¬

not

all,

detriment

orf

let

forget that a considerable
part of the agitation for end-use

directly

that natural-gas retail prices
have been subject to utility
regu¬
lation for many years.

simply

do

believe

not

that

lay down a set of arm¬
for
control, however
well-intentioned, that will meet

anyone can

chair
the

rules

problems of end-use of fuels

one-half

well

as

free-market

as

tember

count

95,448

new

86,361 for the
Steel

future

our

in

thinking.
Conclusions

These five special problems that
are not the only non-

I have cited

calculable risks unique in

our

in¬

dustry that have their origins out¬
the strictly economic.
They
are
not the only abnormal
prob¬

side

lems

face.

we

But

have had

we

many of our abnormal problems
with us so long that we have al¬
most forgotten their
abnormality
—taxes, rates of imports, loss of

export markets, attacks on the
depletion allowance, and the like.
I

have tried

ments

to

the

on

center my com¬

risks that

element of relative

them.
that

These

have

newness

the

are

an

about

problems

ion

concept, with the natural-gas
price control, with the recurring
agitation for end-use control over

fuels, with the renewed threats of
divorcement, and with the limita¬
tions of our highway
capacity.
I am fully aware of the fact that
have

I

the

done

no

than

more

problems.

have

I

the

simple

demand

the

members
all

the

that

reason

of

best

earnestness

even
—

for

solutions

thinking
industry.

the

state

not

suggested possible solutions

at

of

all

With

I urge that the industry's
management, the industry's econ¬
omists, and the trade press that
the

industry

well

so

con¬

centrate

a

these

Only if we concen¬
them, only if we devote

renewed

rive

on

ourselves
risks

to

beyond

eliminating

on

help insure the continued
ity of

these

calculation

can

we

steel

That

year.

this

Bacon, Whipple & Co., Chicago,
111., and associates, on Nov. 23
publicly offered 182,984 shares of
common
stock (par $1) of Weco
at $13.50

shares

certain

per

being

are

share.

sold

shareholders of the

by

Weco

company and none of the proceeds
accrue to that company.
Weco

Products

Co.

porated in Illinois

on

was

incor¬

May 1, 1900.

is principally engaged in the
manufacture, packaging and sale
of toothbrushes, and to a lesser
extent, of hair brushes and sham¬
It

poo

brushes.

The

also

company

were

increase of 10.5%.

of Capacity

at 79.3%

To make

he will have to be

more

means

steel will

sure

careful in his

much

as

relied

users

inventories

in the first nine

could

we

expect the steel

rate

next

to

year

between 75 and 80% of present capacity. That would give
ingot output of from 93,200,000 to 99,500,000 net tons.
The
record, which was set last year, is 111,609,719 tons, "Steel"
range

an

observes.
Blast furnace output in 1954 will be at a little
higher rate
than steel ingot production because steel
producers increased their
reliance on pig iron and cut their

usage of scrap in making steel.
"Steel" estimates that blast furnace
production this year will total
58,233,000 net tons—71% of capacity.
Last year, blast furnaces

yielded 75,856,872 net tons.
American

Iron

and

Steel

Institute

announced

that

the

operating rate of steel companies having 96.1% of the steelmaking
capacity of the entire industry will be at an average of
79.3% of
capacity for the week beginning Nov. 22, 1954, equivalent to
1,89Q,090 tons of ingots and steel for castings as compared with
a similar rate and
tonnage a week ago.
The
now

industry's ingot production rate for the
on annual capacity of
124,330,410 tons

based
For

the like

weeks in
as

1954 is

of Jan. 1, 1954.

week

a month ago the rate was
74.5% and pro¬
1,776,000 tons. A year ago the actual weekly production
placed at 1,956,000 tons or 86.8%. The operating rate is not
comparable because capacity was lower than capacity in 1954. The
percentage figures for last year are based on annual capacity of
117,547,473 tons as of Jan. 1, 1953.

duction

was

The amount of electric
energy distributed

by the electric light

industry for the week ended Saturday, Nov. 20, 1954,
estimated at 9,317,000,000
kwh., according to the Edison Elec¬
Institute.
power

was

tric

This

represented

the previous week

the

over

Car

in

of 120,000,000 kwh. above that of
increase of 901,000,000 kwh., or 10.7%

an

1953 week

and

1,346,000,000 kwh.

Loadings Advance 2% Above Previous

below

119,993

cars

the

over

1952.

Loadings of

freight for the week ended

revenue

the
or

Week

Nov.

13, 1954,
above the preceding week, accord¬

corresponding

14.5%

below

1953

week,

the corresponding

or

decrease

a

cars

of

week in 1952.

47% Above
The automobile

1954,

according

Year Ago

a

"Ward's

Automotive Reports," assembled an
estimated 130,176 cars, compared with 116,285
(revised) in the pre¬
vious week.
The past week's production total of cars and trucks
amounted to

162,886 units, an increase above the preceding week's
output of 15,105 units or 11% due to Saturday work, states
"Ward's."
In the like week of 1953
104,231 units were turned out.
Last week, the agency
reported there were 22,710 trucks

trade

names

products
West's"

are

trademarks

under

which

distributed

"Dr.

paste),

"Gainsborough"
(hair
shampoo brushes, hair

brushes,

nets and powder

puffs) and "Kee"

(handkerchiefs).
Total

sales

Sept. 30,

for

1954

the

compared

with

preceding

year and

ye^r

ended

$8,274,352,

as

$8,718,596 for the

$7,519,759 for

the year ended Sept. 30,




1952.

is to show the general trend of food
level.

Wholesale

pound

per

chief func¬

prices at the wholesale

Commodity Price Index In Latest

Week

Approaches 1954 High Point
The

daily wholesale commodity price index, compiled by
'
Bradstreet, Inc., continued its uptrend to within a frac-high point last Friday. The index closed at 279.15
on Nov.
16, as compared with 278.22 a week earlier, and with
272.23 on the corresponding date last
year.

Dun

&

•

tion of the 1954

Grain

price

soybeans

lost

movements

ground

the

were

while

bread

cereal

mixed

wheat,
was

last

week.

and

rye

Corn

oats

and

advanced.

largely influenced by

more

a

favorable outlook for export business and

a pronounced
drop in
Crop advices continued to stress the need

producer marketings.
for additional

Aggressive

highs for the
wheat
more

moisture

demand

the

in

southwestern

from livestock

feeders

Winter
sent

wheat

oats

areas.

to

up

new

Rye developed strength

season.

in sympathy with
oats,
Weakness in corn and soybeans stemmed
fra$fr#'
liberal offerings as the
harvesting of these two crops neared
and

,

completion under ideal weather conditions.
Activity in grain and
soybean futures on the Chicago Board of Trade showed littie

change for the week but

substantially higher than

was

a

year ago.

Domestic flour business continued to be
disappointing. Firmer
prices failed to alter the cautious routine buying policies of bakers
and jobbers despite the small balances held
by these interests.
Butter prices continued their upward trend under

trade

demand

in

anticipation

of

Thanksgiving Day

active

more

Egg
prices advanced quite sharply as demand for
practically all grades
continued to improve.
Raw sugar showed further strength as the
result of a
scarcity of offerings due to a tie-up of shipments from
San Juan, Puerto Rico.
Spot cotton prices showed
chief bearish influence being

forecast

crop

The

which

market

a further slight drop last
week, the
the Government's November cotton

well

was

developed

above

trade

general

somewhat

a

steadier

sessions aided by the recent expansion in loans
ton.
CCC loan entries reported in the week

expectations.
in

tone

closing

1954 crop cot¬

on

ended

November

totaled

119,800 bales, against 93,700 in the preceding week, with
the season through that date
totalling 622,300 bales.
Trading in the 14 markets slackened following the release of the
entries

for

crop forecast, with sales for the latest week reported at 376,200
bales, against 425,700 bales a week previous.

Trade Volume Shows

Slight Recession In Latest Week

The recent rise in retail trade

was

not sustained

in the period

on

Wednesday of last week and the total volume of busi¬
ness fell
slightly below that of a year ago.
Although there was
a satisfactory response to
widespread Veterans' Day promotions,
consumers' preferences centered on small—rather than

big—ticket

items, and interest in Christmas purchases gained moderately.
Merchants

preparing for the biggest Yule season ever.
The total dollar volume of retail trade in the week was esti¬
are

mated

by Dun & Bradstreet, Inc., to be 3% below to 1% above
a year ago.
Regional estimates varied from the cor
^
responding 1953 levels by the following percentages: East arfci
the level of

IViiuwest —2 to —6; New England —1 to —5; Northwest 0 to
—4;
South —1 to -f3; Southwest 0 to -f-4 and Pacific Coast
+2 to +6.
The total volume of apparel sales decreased last
week, as
many

failed

consumers
was

but coats,

continue

to

Fall

wardrobe

purchases.

decline in the demand for women's suits and dresses,

a

furs and millinery

popular. Sales of men's wear
gained with darker-colored suits, dress shirts, sweaters and other
were

total

purchases

of

.

..

sales

of

furniture,

bedding and applianceslagged, although the demand for television, radio sets, china and
glassware rose.
-

Trading in most of the nation's wholesale markets increased

seasonally in

the week, as many buyers replenished their
stocks while others placed
early commitments for Spring.
1

The total dollar volume

level of

a

year

before.

Improvement

was

Fall

approximately equal to the high
;

.

the

1953

cars

and

881

trucks in

the

comparable

week.

Business Failures Decline
Slightly Below Preceding
Commercial
in the week

&

and

industrial

ended Nov.

18 from

Bradstreet, Inc., reports.

below

ably
the

their

toll

of

223

failures

a

227

This

in

dip

declined
the

slightly

to

208

preceding week, Dun

brought casualties

a

Department store sales

pre-war

level, mortality

was

down

Federal

32%

from

the

1939

toll

Reserve

on

Board's

a

tered above that of the similar

ended

Nov.

year.

Fifteen

of

was
was

taken from

noted.
For the
registered from

According to the Federal Reserve Board's index
store sales in New York

from that of the

last

as

ended

Retail trade volume in New York City the past week, accord¬

For the

reported

week

ing (o merchants' estimates, was slightly ahead of this year.

yet exceeded the 27

size

the

period in 1953, while for the four

13,

In the preceding week, Nov. 6,
was

department

City for the weekly period ended Nov. 13,

1954. registered a decline of 3%

this

for

1954, a gain of 4%
period Jan. 1 to Nov. 13, 1954, a loss of 2%
that of the 1953 period.

Failures involving liabilities of $5,000 or more
dipped to 177
from 192 in the previous week and 196 in the
corresponding week
of 1953.
A slight decrease also occurred
among small casualties,
those with liabilities under $5,000;
they were down to-31 from 35
of

country-wide basis

index

Nov. 13,
1954, decreased 2% below the like period last year.
In the pre¬
ceding week, Nov. 6, 1954, an increase of 5% (revised) was regis¬

little

ago, but they remained consider¬
above the 167 in the similar week of 1952.
Compared with
year

was

demand.

weeks

Week and Year Ago

~

needs.

preceding week and 3,617

of 308.

were

tion

the

these

are

represents the sum total of the price
foodstuffs and meats in general use and its

noticeable in orders for textiles, some appli¬
ances, toys and holiday novelties, but furniture was in lessened

or

(toothbrushes pnd tooth¬

past

this country, as against 21,49-3
(revised) in the previous
week and 24,522 in the like 1953 week.
"Ward's" estimated Canadian plants turned out
3,500 cars and
695 trucks last week, against 2,687 cars and 686 trucks in

made in

toothpaste, hair, nets, powder
puffs and handkerchiefs.
principal

or a

the

index

raw

The

industry for the latest week, ended Nov. 19,

to

ago,

cost

wholesale

furnishings frequently bought.
In spite of some early Christmas
layaway buying,
household items were generally slow the past week.

Output Rises 11% In Latest Week and

sells

The

The

of 31

There

18,301

of
and

showing advances in

.

U. S. Auto

year

a

week were
flour, wheat, rye, oats, barley, hams, bellies, butter,
coffee, eggs, currants and lambs. Down in price were
corn, lard,
sugar, cottonseed oil, cocoa,
potatoes, raisins, steers and hogs.

gain

a

and

comparable

like week

Commodities

ended

Electric Output Registers Gains in Past Week
and

compared with $6.51

gain of 5.7%.

for

months

ingot capacity.
Some of the steel company analysts have been
thinking that next year's steel ingot rate will average around 75% *
of capacity, and most forecasts of business in
general are for a *
slight increase.
If the current 79% ingot rate accurately reflects '

The

Continuing the uptrend of the three previous weeks, the Dun.

Strength in

conditions,

cojjM

as

wholesale food price index registered a further
substantial rise last week to stand at
$6.88 on Nov. 16.
This was
up from $6.80 the week
before, and represented the highest level
since Aug. 24 at $6.89.
It

ar¬

year.

business

$100,000,

Bradstreet

order

71,100,000 tons

as

their

on

finished steel—mainly

of

&

with

Consumption of finished steel at an annual clip of 71,100,000
tons has been exceeded in
only three years—1950, 1951 and 1953.
If finished steel were
being produced at that pace this year, we
would need an ingot rate of
94,800,000 tons, it states.
Steel production at
94,800,000 tons is equal to 76 % of present

2.5%

Products Com, Stk.

There

compared

increased 13,660 cars or 2%
ing to the Association of American Railroads.
Loadings totaled 708,757 cars, a decrease

Bankers Offer Weco

Products Co.

194-3.
as

buyer is going to be a

when needed,

this

prosper¬

our nation.

These

or an

consumption of finished steel will be

industry manageable and

our

year,

planning and order earlier, declares this trade magazine.
It looks like this
year's ingot output will total 85,518,000 net
tons, or 68% of capacity, states this trade weekly, representing
about 63,300,000 tons of finished steel.
"Steel" calculates that

risks.

trate

keep

attention

year ago,

increases, delivery times lengthen.

mand,

serves

a

during the first 10

of

>

this

With inventory reduction over he'll have to raise his
buying
to the level of consumption.
As the over-all demand for steel

up

com¬

my

period

same

far

so

busier man from here on
buying more steel and doing more advance planning, says "Steel,"
the weekly magazine of
metalworking.

associated with the cush¬

are

19.2%0 above October 1953 with

was

Output Scheduled This Week

The

of

recognized

listed

concerns

This

be

9,256, and it

The number of new businesses chartered
months of this year was also the highest since

7,800,000 tons

must

at

excess

19 in the preceding week.

Wholesale Food Prite Index
Registers Substantial
Gains In Past Week

Industry

total of 8,267.

a

competition meets those problems.
risk

pared with

i

tions, the greatest number for that month since 1946, Dun & Bradstreet, Inc., states. This represented a rise of 6.4% over the Sep¬

the

upon

fact

the failing businesses had liabilities in

,
■„

The State of Trade and

our

And

not

I

'

'

to

economy

expansion.

control is based

1

bureaucrats, be¬

cause a

No

'
s*

or

33

below the like period of last year.
an increase cf 9% (revised)

1954,

reported from that of the similar week in 1953, while for the

four weeks ended

Nov. 13, 1954, an increase of 4% was reported.
period Jan. 1 to Nov. 13, 1954, no change was registered
1953

period.

<

U

The Commercial and Financial Chronicle

(21701:

Broad Street

7 MUTUAL INVESTMENT FUNDS

SECURITIES

Shareholders

company

objectives,currently in¬

bine

to combine their com¬

have voted

over

350

secu¬

Street

fund.

mutual

Connecticut

The

invest¬

tion

second

&
RESEARCH CORPORATION
NATIONAL SECURITIES
Established 1930

NCKPOUTED
INVESTORS

the

Broad

Street

organiza¬

the

pointed

also

Freeman

fund

mutual

diversified

with

Management

vestment
tion

voted

were

Corpora¬

favor

in

Shareholders

return.

will be advised when the exchange

the

of

Investing

Street

Broad

in

shares

ratios

to

of

Street

Prospectus may be obtained
from investment dealers or

200

and

completed

been

have

the

exchange procedure to be

of

As

tffrK O

followed.

Sept.

•

of

its

first

mutual

statistics

on

equal

monthly basis, the National Association of Investment Companies

providing

regular

the

pur-

.a decrease of opened by investors during,.the

$4,146,061,000.

plans

accumulation

17,781

Sales of mutual fund shares for

Cash,

U,

S.

Government

secu-

held by the 112 mutual funds on

Repurchases

(redemptions)
amounted

to

of

during

shares

Oct.

October

$31,868,000

short-term

and

amounted

31

to

obligations

$301,058,000,

increase of $15,165,000 over the

an

u-ico

Name..

for

Sept. 30 holdings and $37,411,000

the 10-month period totaled $332,-

Funds.

greater than such holdings at the

861,000.

Address.

and

During the three months

end

COMPANY

MONTH
112

Machine

Pood

OF

STATISTICS—

Total

OPEN-END

South

net-assets

$5,338,517

Sales

of

$4,146,061

$5,369,700
3rd Quarter

$70,506

_____

$217,100

$662,729

107,300

332,861

of

Casta,

S.

U.

Dec.

Governments

Sept. 30,1954

investment in

common

tions selected

on

and

plans

of

new

opened

companies

Short-Term

the

quarter were:

1954301,058

.'

Chance

—

Kodak

4,500

10,000

Montgomery Ward & Co.fe_'—L__
teo.ooo
Na.ional City Bank,
—
United

—

Mfrs.__-r__.TL__

&

Sound

Standard

40,000 State

63,000

partly

tRights.

Marathon

addition

to

~

3rd Quarter

October

1

1954

>

.

Bank
City

Security. First N.B.".(Los Angeles)
United

10,000

Western

declared

year-end

special

a

■net

realized

Both

holders

with

6,280-

'

17,781

\

*53,28®*.

stocks of corpora¬

•t

for

some

investment

income

are

ajxy quarter since

in

number
Wellington's
the

-

rank

largest

Ameri

these

ington

will

dis

hav

over

th

total

of

$53,400

from

net invest

<

sp

of

the

meet

require¬

Rhode

and

permit

specifically

their
in

funds

that

meet

certain

requirements.

The

New

Hamp¬

shire

buy

shares

banks

mutual

tC^Sl ^bout 135 000,
Lone

to

savings

foreign

Fu

thus

(where New England Fund

wnich

Located

the

The Fund

is qualified for savings bank
investment) are the only states

Shareholders
ry;

qualified

also

to the

states ||j§!$j$^33

48

to

f

now

Hampshire

New

Island

inception.
go

are

Commissioner.

mad&'by tfciis leading

paymep

mutual
in

ings Bank law and to be added to
the legal list by the State's Bank

district ion"! to share¬
in

England

organized

ments of the New Hampshire Sav¬

profitSi~and, $3,400,000

ever

1831,

Hampshire.

comoanv

year-enc^distfibutions of
$10,100,000 (rom fiet realized
net

trust

becomes the 21 mutual investment

recorc£LDec,/8.

of

preferred.

New

purchase by savings banks in

New

These

from net realize

..

Boston in

securities-profits.

$36,600,000 in
'

dis¬

of

of

iuiiy-managed

investment

share from

a

'

*

conversion

a

>

(Cleveland)

Pacific Railroad

SHARES

Fund,

payable D^c. 29, to stock¬

are

'

'Estimated,

'Through

THE

Detroit

Bank

Fruit

10,000

sh&re from net

tribution of 63 cents

'
of

»

v

National
National

3,500

tfie Fund also

holders

Octbber. 1954
'

period (73
plans)____

a

•'

Chera|-

5,000

quarterly divi¬

investment income,

With

-

10 Mos. Through

accumulation

in

a

,■

12,000

WITH THE DECLARATION of its

In

L
^ /.

*

Oil

Ander: on-Prichard

20,000

V

"A" *

Stores

American

800

'

.

& Finance

2,50® Hartford Fire Insurance
15,000 International Minerals &

thrgtigfy eights.

.

& Light

(Indiana)

ELIMINATIONS

7,500
'Purchased

■■

r

-

Power

Oil

Loan

2,600

Illinois

Merch.

Johnson

Puget

10,000

5,000

Mead

16,200

5,600

"B"_

(Eli)

Lilly-

'

.

Ltd.
Groceterias "B"

2,000 Loblaw

60,000

______

—

-

"A"

Raynolds

&

15,000 Dominion Stores,

19,866 2/s

AircraffcSsI—__

vought

Chrysler
Eastman

12,600 Devoe

Sold

in number of sha
•

*

ADDITIONS

NEW

Shares

20

Bonds

285,893

—

Month of

Accumulation Plans
Number

mutual investment

diversified, managed

for

in the com¬

changes

stock section of the portfolio

mon

34,200

SALES

countries, they
'l

-

3l. 1953—$263,647

Oct. 31,

a

quality for income."

Principal

20,000

*

'

does
policy.

to sacrifice

20,000

in

October, 1954

larger current

a

management

They feel that this is not the time

29,000

Aircraft

greatest

10 Mos. Through

31,868

shares

Holdings

a

secure

Your

not intend to follow such a

*10,000

Utilities__^__

Incorporated ZZZ^ZtZ
Co. of CalifornliS——

These

1954

Redemptions

Canadian

is

to

income.

20,000

Company—

12/31/53

.

Fund

order

15,000

—

_____

Steel—

S.

its

9/30/54

10/31/54

•

offering

a

10.000

Chem._____

mutual fund

October

Canadian

of

„

15,000

•_

Oil

holders

FUNDS

Month of

conipany

Pibre^_

Co

the largest

(In 000's of $)

v^K^Fund?

&

&

Power

securities

1953.

of

OCTOBER, 1954

„

$

Chairman

Putnam,

25,500

*

—;

Motors

Illinois

•

What is

28,000, compared with

10,000

—ZZ

Paper

General

■

1

Bought

Champion

from
OPEN-END

State.

Oty .....

'

,

dend of 22 cents

rities

729,000.

describing
Organization and the shares of your

•

Steel

were

opened,

Jftrftstnf months of 1954 to $662,-

prospectuses

per

a year ago.

.

506,000 bringing total sales for the

me

to

rose

George

$31,183,000 from the Sept. 30,1954 month Of October, bringing the 100th- consecutive quarterly divi¬
total, due primarily to the pre- total 0f new pians started in the dend, the $375 millipn Wellington
election stock market decline, but
first 10 m0nths of 1954 to an esti- Fund \ culminated r a quarter-cen¬
a
gain of $1,192,456,000 since the mated 53,280.
During the third tury of uninterrupted quarterly
first of the year when net assets
distributions to its Shareholders.
quarter,
the
Association states,
totaled

Keystone Company

Please send

ten

for

.

chase of mutual fund shares, were

X,l.'

#o?'5oo niX'* kls

50 Congress Street, Boston 9, Mass.

your

reports
that
plans,

accumulation

new

'

Bethlehem

Northern

Association

The
6 280

the month of October totaled $70,The

value

current asset

the

to

of their shares.

reports that total net assets of 112
open-end mutual fund members

COMMON STOCK FUNDS

option at any time to
their holdings into cash

convert

a

notes,

the

have

regular compilation

fund

.'

mptions

Association

the

holders,
.

In

BOND, PREFERRED AND

$21.98

1954,

30,

Steel

Armco

U.

r™

and

$55.•> Oil J ion

Custodian FuncLs

1954

PURCHASES

Pullman

$107,300,000. Mutual Fund share-

T»»11»

^

Keystone

record

Company—

Middle

Fund Assets Now

Berkeley St., Boston, Mass.

to

the Trustees, said that although

Union

Corporation

Parker

equal

24,000

United

The

$90,760,000,

standing and 110,925 shareholders.

operate

receive

combine with Broad
Investing and only .3%
voted against.
proposal

capital and income

third

share, compared with 862,886,000,
equal to $17.53 per share, a year
ago.
Shareholders on Sept. 30,

%

will then turn in their shares and

ing shares of The Connecticut In¬

long-term growth of

Fund

the

total assets, 26,346,767 shares out¬

out

at an expense to its
shareholders which is among the
to

More than 86% of the outstand¬

for

for

number of changes were made in
the net individual issues, no important
acquired the assets of Ferncliff
asset value per share was $24.84.
change was made in the broad dis¬
Trading Corporation.
lowest in the investment company
This amount, together with a spe¬ tribution
of investments
during
Completion of the transaction field because of its participation'
cial distribution of 24 cents per the
quarter. In the common stock
several
other
investment
with The Connecticut Investment with
share in February from net capi¬
section, emphasis continues to be
Management
Corporation
will companies in an arrangement un¬
tal
gains
realized
in
1953,
is placed upon shares of strong, lead¬
which
investment
research
raise
Broad
Street Investing's der
equivalent to $25.0£Tper share and ing companies with a "forward
and
administrative services
are
total assets to above $-31 million
compares with a net asset value look," Mr. Putnam said.
as
compared with $36 million at provided at cost by Union Service
of $18.09 per share cm Sept. 30,
The report notes that it has be¬
the start of the year.
In addition Corporation.
1953
mut, •
come increasingly difficult to find
to acquisition of the assets of the
Under the terms of the plan as
During the quarter, the trust
two
good investments that provide an
companies, record sales of approved by shareholders, the as¬
added $14,142,663 to its investment
attractive return, as the prices of
new
shares have contributed to sets of The Connecticut Invest¬
holdings and sold "*$6,488,684 of stocks have advanced
Broad Sreet Investing's growth in ment
substantially
Management
Corporation
securities, both figifres excluding over the
1954.
So far this year, net sales will
past year.
be exchanged
for Broad short-term notes.
of new shares have added more Street
Investing
shares
with
"Under such conditions," the re¬
Major portfolio changes for the
than $10 million to the fund's as¬ eouivalent asset value. Sharehold¬
port says, "there is always the
three months included:
sets.
"j ** .'"4
■'
'
ers
of the Connecticut company
temptation to lower quality ■» in

ing, announced that the fund had

a

of

portfolio
selected

securities

PUTNAM

reports

Comparable figures for the third
quarter of 1953 were: $476,591,704

:

A

TheseT^re

the Trust.

Boston

quarter of 1954 total net assets of

figures in the 30-year history of

is abte

that Broad Street Investing

1954

shareholders.

behind this record, which has

Mr.

v

Invest¬

of

Massachusetts In¬
vestors Trust reports total assets
of
$695,642,528
with
28,000,028
shares
outstanding
and
118,684
30,

GEORGE

THE

ended

months

THREE

THE

Sept.

a'chvelv engaged in the in¬
vestment company field for almost
25 years, is warranted,

Chairman of the Board and Presi¬
of

in

FOR

been

to join forces with
Broad Street Investing this year.
In January, Francis F. Randolph,
dent

York

Crow ell

H.

confidence

that

ment comoany

address.

120 Broadway, New York 5, New

Broad
Corporation, a

is the

corporation

information folder and

prospectus.clip this ad
and mail with your name and

with

company

Investing

cor¬

For FREE

porations.

their

By ROBERT R. RICH

Freeman,
President, pointed out that in the
opinion of that company's man¬
agement the investment record of
Broad Street Investing is good and
holders,

a

varying investment

rities of American

Mutual Funds

submitting the proposal to the
Connecticut
corporation's share¬
In

Connecti¬

closed-end investment
with assets of $820,000,

poration,

Mutual Funds with

The

of

Investment Management Cor¬

cut

SERIES

vested in

Combine

to

With Connecticut Trust

NATIONAL

7

Thursday, November 25,1954

...

\

to

qualifying . certain
selected funds, was passed in 1949.

the

corporations

statute,

»E*ngland

New

ders.-

Fund

has

be/en

investment by
d\ its share- New
Hampshire fiduciaries for
several years and has long met tjie
25 years a
,n
dividend? qualifications for savings
banks
jncome and with the exception of the mipidistributions mum. size. This? requirement was
ity profits. fulfilled in September, 1954 wl>en
lions,

eligible

WfF-

for

trust

.

'

the basis of possible

participation in Canada's growth.
The facts
tained in

your copy,

on

this mutual fund

free

a

ask

are con¬

booklet-prospectus. For

any

investment dealer

Fund

CALVIN

A

BULLOCK

,

Established 1894

Please send

me a

free

Common Stock Investment Fund

Managed by

Investment objectives of this Fund
long-term
capital
and
income
growth for its shareholders.

*4

-

Prospectus

upon

request

ITON
X

&

HOWARD

INCORPORATED

24 Federal Street
BOSTON

booklet-prospectus

HOWARD
i

STOCK FUND

BALANCED

are

OneWallSt.,NewYork
on

EATON

EATON & H

or

mail the coupon below to

333 Montgomery Street

BOSTON
ESTABLISHED

1924

SAN FRANCISCO

Canadian Fund.

flame.
Address.




Lord, Abbett & Co.
New York

—

Chicago

—

Atlanta

—

Los Angeles

Prospectusek from

your

Investment Dealer

or

the above.

(V

Volume 180

Number 5380

The Commercial and
Financial Chronicle

(2171)

-

*

the

Fund

passed

the

$10,000,000

milestone.

EATON

&

30

HOWARD

1954

per share of

$15.67
of

Balanced

Fund
up

shows

$18.46
Total

year.

Sept. 30

on

from

value

asset

17.8%

up

over

share at the beeinnine

ner

the

21,844

compared

with

Fund Third Quarter Report dated

Sept

shareholders,
20,359y§

■

value

of

the

$129 878 729

was

$101 963 256

at

the

be-

gihning of the year
Shares outstanding total 7,037,337 compared
with 6,507,970 and the number of

TOTAL NET ASSETS of T. Rowe
Price

Growth

Stock

Demand fox Equities
.

er and

(H.0%), insurance
<5-4%)> banking (5.0%) and natural gas <4-4%)-

?o & HOWARD Stock Fund

Th-

i? ?nSUaiIer Report dated Sept.

3SSeLv£ue

sharp

nf

$i?n«

npr

of

ATOMIC SCIENCE

thp

Fund

owv,

Spnt

on

share held to stockholders of

nao

xw

eu

DCDCnmi

and'

1 726 902

IhurlL*

thp

*
_

5,286.

MUTUAL

is

Sept. 30, 89.4% of the Fund

invested in 100 stocks
repre-

was

FUND, Inc.

sentim?

designed to provide

10.6%

a

97

Hiffpro«+
different

was

U.

in

managed investment

in

S.

industries,
Government

bonds, short-term notes and cash,
a

variety of

J.

Enright

and

Henry G. Kuipers as Vice-Presidents and Raymond P. Linn as

j

The

net

Oct.

on

asset

31,

value

eariier

aenture o(

reoorts net

companies participating

dustries

in activities

ance

resulting

1

from Atomic Science.

(9.5%),

-and

power

(9.3%),

chemical

banking

Sept. 30. 1954 of $15 428.-

on

(5.8%).

and

$

Ta/»nrf
year-end.

nrevin,,s
previous

Tu

Affiliated Assets Reach
Record $280 Million
-r

.

-

Net

of

assets

Inc., second
stock

mon

reached

31,

1954

,

Fund,

the

com-

investment companies,

$280,914,822

its fiscal year

Oct.

compared with $248,year earlier.
The in-

as

744,204

a

which

crease,

from

of

record total

a

^

Affiliated

largest
argest

the end -of

at

A

resulted

gain

Mr- Prankard states

-

rindn

from

year amounted to

income

23.,cents

other

stocks

1~!1

reached

an

all-time low for the year reported,

amounting t<f'50

cents for each
net assets compared with 58 cents in the previ$100

ous

of

average

*

and 65 cents two years

year

ago.

-Changes in diversification of
sets

during

reduction
the

::::

Included

year

22%

to

14.5%

II

%

to

a

shares and

increase from

an

better

or

were

stocks fourth

at

H. I. Prankard II,

8%.

buy

,

should

can-

other

trend

income

of

ti-snes

is

for

as

"a

good

start

toward

relieving common stock
investors of the burden of double

share

taxation
nual

n

on

and includes

reoort

how

to

tax

come

detailed

make"

out

in

the

an-

instructions
the

1954

in-

At the

requirements

of savings
rise, due to higher
costs
and
growing competition,
Savings and loan associations have

now

in

are

"Our
and

our

electric

holdings of electric light
stocks

power

ago, we

increased

illustrate
Four

our

There

thus

are

financial

equities

institutions
and

more

though

two

preciation
up

do

many

to

go

more,

So

tions

even

more

income,

years

these stocks from a little over 6%
of our assets at the beginning of
the year to 16% at the end of the

investments, which
their yield further.
Common

stocks

will

The

of

Directors

has

quarterly dividend of

a

*

ment

15,

t
&

Board

a

share from net invest¬

income, payable December

1954 to shareholders of

ord

November

29,

rec¬

1954 and

depress

equities to

from net security

profits payable

December 27, 1954 to sharehold¬
of record November

in stock

or

in cash

29, 1954

at the

option

Charles J. Vollhardt
Treasurer

Elizabeth, N. J.
18, 1954




I

oAton

tain the rate of return, while the

supply
tend

I

I*

of

to

duced

corporate

ments.

because

capital
for

Demand

exceeding

Street, Boston

re-

require-

stocks

has

supply

the

this

tors

°* l°ss»
"The market prices of

trie light and
increased

elec-

stocks

power

our

have

greatly since

1950, and

in the past year the prices of

some

our

investment

sub-

now

only 55% of net income for all
corporations, barring a major ad-

^ry

so

jn

,

pronounced
recent
,

drugs

and

in

years.

our

coun-

Stocks

,

of

.

shoe

:

it is

are

typical in this latter category."

adequate

or to find
outlets,

investment

Demand

for

stocks

would

muc^ crr^pf^r than the

interesting to note that in

if

individual

new

be

supply
should

investors

the decade of the twenties people
common stocks to
yieli

modify their attitude and put a
larger proportion of their savings

less than bonds, because of the re-

directly into stocks.

tained earnings.

But all this is dependent upon
corporate earnings being sustained
so
that dividend rates can be

expeered

that

investors

conscious

It is conceivable

may

again

0f

In that

stocks.

yields
with

are

yields
,

com^mes

ings to sustain income

turn in the economic situa-

verse

tion.

should find it desirable to
rapidly to stock hold-

more

are

become
the

more

retained

.

been

year.

pared

event,

prevailing

satisfactory

compared

with

bonds.

on

...

^

As

,

increased.

or

the dividend

run

:

Over
return

com.

mortgages,

maintained
thg

is the objective of equity invest-.
ment.

that

much less true.

.

is

Dean Witter Places
Friden Stock at $32

v.*.

DIVERSIFIED GROWTH STOCK FUND, Inc.

issue

Quarterly income dividend of 4.8c
1954 security

The Board of Directors has declared

share from

per

profits distribution of 56c
a

share and
per

quarterly dividend

or

iri cash

at

the

of

stock

November 18, 1954

of

of Friden

Inc., of
placed
through Dean Witter & Co., San
Calculating

San

Machine Co.,

Leandro,

its

was

This
new

Calif.,

announced

financing did

was

on

not

Nov.

19.

constitute

the part of the

financing on

Friden

pi

company.

P
tff
m

option of the shareholder.
Treasurer

shares

14,500
(par $1)

Francisco, Calif., at $32 per share,

I

net

distribution of 56£ per share from net security profits
payable
December 27, 1954 to shareholders of record December
1954 in stock

I
I!

share

investment income, payable December
15, 1954 to shareholders of record December 1, 1954 and a
a

common

With Continental Sees.
(Specir.1 to The Financial

50 Sate

will

of

look forward to eventual dividend

Elizabeth, N.J.
hm*am FUND PisnrBUTOis. INC.

issues

stock

new

contract

increases since'dividends

Charles J. Vollhardt

I

into
sus-

t'°n with comparatively small risk

yield

1,

of the shareholder.

Nov.

I

FUND

go

larger extent, to

It could exceed the supply
to a greater degree over the nex
few years if institutional inves-

of 4.8£

%

a

stantially more than bonds.
And
investors in common equities can

^Seorye

PUTNAM

a

prospect of insti-

a

At the prices we paid for
these stocks, they seemed to offer
attractive prospects of
appreciayear.

I

distribution of 47 cents per share

ers

1

I

£7/ie

De¬

are

finding they must

been

still

u

12 cents

allowances

face

we

An

declared

time, corporations
a
heavy flow of

Conclusions

for

reluctantly,

so

One is the need for

:•>

1

of

billion.'

report to receive the full

taaaaaaaaaaaaaaae*"*--'

subject to rapid

going
rapidly, going up without in-

into

reasons

The second is the possibility that
holdings in there will be a shortage of other

our

—
program

funds from internal sources.

benefit.

I

same

assured

are

become more rate conscious in order to attract the public's savings.

while

the

as

amortization is completed.

the

the population growth which has

law "

continue

building defense and defense-

supporting^plants

investments,

The

in stocks which we believe will
d th
growth
l^ave above-average benefits from earnings and the growth factors iT1
tactors m

tax

of

from

eral

p security profits distribution
p

'aiTd^quTpme0^

.,

or

gards the passage of the last Fed-

re-

ments will not increase materially.
plant

conscious, hence institutions must

ings and increased

President,

years.
Correquirements
Given a stable1
economy, working capital require-

declining.

are

chemical,

spite the reduction, electric light of them reached points at which
and power shares remained the further
appreciation
prospects
largest single group held, with na- seemed insufficient to offset the
iural
sto<:^? jeco.nd«
*ncreased risk. As they reached
food stores third at 9.3%; and these points, we reduced our holdkank

over the next few
porate new ca ital

over

in oil,

light and power, natural gas, food,
and banking stocks.

of

3.4% to 5.8% in drug shares. Des-

share and 1954

of 47c par

the

from

as-

holdings of electric light and

power

seemed

method of investing.

expenses

taerease"nt^eV^^owef'rate

sat-

realize enough income

can

The supply of
equities, whict}',*|
has not been increasing materially

electric light and power, and auto-

stocks,

Operating

in

equal

holdings

profits realized in the

proceeds

*

largest

^

INC. |

the

an

motive

fiscal year.

,

,»,

which

them to have

share,

share from

|j
|g

,,

re-invested

compared with 22 cents paid in
the previous year.
On Nov. 1,
the company declared
a
capital
gain distribution of 29 cents a

a

to

equities

ther.

from

income

therefore,

ti.onalfinvestors whenever^ supthe
P*y of flew mortgages may contract, particularly if the level of
interest rates should decline fur-

institutions to

the

in

earnings,

in¬

They will

isfy their, needs.

and

as

Ilr,of 12c
per

institutions

investments

not

--•*

-

*

,

investments

Dividends

87th consecutive dividend

become of more interest to institu-

their buying of stock?

five years

14%.

or

l
I

They evifear of inflation,

Will

income

standpoint,

Given maintenance of corporate

security.

that have intervened the company
has sold off those stocks which
reached prices that the management felt carried substantial risks

entirely

,

the yield

eager for dolIar
against
purchasing

as

are

common stocks. Any

-fttSSrSX JT SgSUt SStSUSSi £2?SSri»
mer of 1949. During the
investments,
because they
w,

mu-

than

?pe""e"d fT ' Prefer t0,lnvest
6 there is and mortgages so long as
bonds
adequate
Supply^and
they can get

com-

In

contraction of the mortgage supply
would .reduce the supply of the
chief competitive investment from

an

that

several

more than their holding of

tions to buy

a

the

rather

enough

-WASHINGTON 7, D. C.

INVESTORS,

crease

fixed

1033 THIRTIETH STREET, N. W.

in

not

Saltings institutions, other than
si1,0

GET THE FACTS AND FREE PROSPECTUS

ATOMIC DEVELOPMENT SECURITIES CO.

FUNDAMENTAL

is

institutions

stitutions?

light

(6.2%),

depression

cards in the foreseeable future, the
rank and file of individual investors prefer to place savings in fi-

How about the trend of the de.

(12.9%), insur- '943 as compared with $12,420,466

oil

gives support to a
conclusion
that,
despite
the
strength of the stock market, des-

mand for stocks from financial in-

as-

holdings by in-

were

t

This survey

Trust> p,an A and p|an

/'Boston. Mass.)

in

absorbing virtually all new funds,
A drop in building which would
reduce the supply of new mortgages could thus greatly add to
the pressure on financial institu-

an

uptrend.

security

The largest stock

sets

slight downtrend, not

a

power

FUND

time

corporate bonds in 1954.

directly into equities.

*

COMMONWEALTH
p

shows

:i ii iwas $13.34, dently have less
°"e
They' are more

SJlaT* °Bj

first

life insurance companies
will increase their mortgage hold-

group

nancial

per

the

years,

year,

pite growing confidence that

*

pared with $1,650,000

For

sav-

the percentage preferring equities tual savings banks, mortgages

major

FUND~As
°f
1
L
total net assets
amounted to $2 170,000 as com1953.

On

the

announces

D.

SeCretary of both funds-

numberwith
of

shareholders, 6,517 compared
ATOMIC DEVELOPMENT

Shares,

only 51%

prefer savings accounts and
ings bonds this year.
Last
even

H.J. PRANKARD II, President of
Affiliated
Fund
and
American

of

,

the equity figure was 20%. Thus, ings
in the higher income

-

DDnrDCCC

PROGRESS

j

toe total 2 034 71 n

MUTUAL FUND.

rec-

ord Sept. 17, 1954.

per Business
°^er election

•

,6i !?fn!!g
wolcafoSin

an

niricr

n

u

Tntai

vpar

from $20 860 870 at the
begm

up

through

V

9

page

The Institutional and Individual

'■

in

from

°n SePfe&°, 1954, 7.7% of the creased to $3,460,932 on Sept. 30,
Fund was in cash> u- s- Govern- 1954 as compared with $1,956,386
ment and shori-term notes, 16.2% one year earlier. Net asset value
was inv.ested in corporate bonds, per share stood at $23.17 on Sept.
14.2% in preferred stocks and 30, 1954, a gain from $15.82 on
61>9% in common stocks.
The Sept. 30, 1953. The earlier figure
^arSest common stock holdings by has been adjusted for the stock
industries were oil (13.5%), pow- distribution of one share for each 19% prefer equities and

PERSONAL

invest

Continued,

<in-

Fund

35

I

P

i

GRAND RAPIDS,

ard

S.

tinental

Felton

is

now

Securities

Chronicle)

Mich.—How¬
with

Con¬

Co., Inc., Peo¬

ples National Bank Building.

36

Financial Chronicle

The Commercial and

(2172)

process.

the

scientific valuation of

service

area,

reduction

a

in

charges to $22 million would in¬
to

$3

share

a

the

on

an

was

cessful

the dividend paying ability

crease

It

on

One of the
the

cf

sight.

the

stock
low

its

At its best last week

stock.

rnpn

the

for

week,

only

above
and despite

year,

a

taking

Some renewed enthusiasm

inspection

providing

after

for

prop-

erty improvements and the small

results
,

,

,

lenders still
exist and compete
without FHA. They were to learn

off

net in¬

that with

expected

come

As much

the distribution.

where supply-demand market forces have been subordinated
to political regulation and dictation for expedient political gain,
Short-term solutions have con-

quered long-term constructive
thinking. It has become a fetish
to deal in temporary expedients
without a passing thought to the

this

as

action may have helped

divldend

has

stock

the

indications

been

at a terrific
example, .the
savings and loan associations have
recently been forced, however re¬
luctantly, to consider petitioning

»hat progress

toward reduction in
\S6ixed charges may be accelerated
sharply during coming months.
Cnder the bond adjustment nlan

compulsion, not
charitable origin,
to identify itself with a large sup¬
ply of private housing.
If the
the
Federal
Home Loan
Bank
legislation seemed adequate for
Board for an increase to 25 years
the purpose, they insured! the goal
in the self-liquidation period so
of more housing by looking the
that they would not be legislated'
other way on inspection, by c6mout of the lending market.
promising standards on material,
Such a lofty start! It is almost
size, style, plot-size and all other
have deteriorated so

a

sinking fund '

fixed

small

to

goes
6

so-called surplus income

sinking

Dividends may be paid only

fund.

out of accumulated net income re¬

deduction of this
earnings
sinking
fund.

maining

after

surplus

while combined fixed
and contingent interest

Moreover,
charges

exceed $20

calendar
there must be added to the

year

million in

any

surplus

earnings sinking fund a
dollar amount equivalent to any
dividends

paid

on

any

Because

stock

of

these

of

class

has
nas

been
oeen,

velopment

earning power.

the

charges

Progress

more

The extensive

has

program

t

to

end. Thus

an

longer be

an

are

apparent in the

artificial

uneasy,

of

nature

the

The tragedy is that so
really stopped to realize what
hacj actually transpired.
We are
currently witnessing the absolute
socialization of the housing market while at the same time mainportions.
foW

taining

increase

the

of

fiction

private

property ownership,
Let's

equipment buying

come

no

1953,

is being made.

progress

there will

in

and in
require$25,344,000. Now

to

came

slow

combined

the

year

rnents

rather

through

years

that

was

ramifications

The

faucet.

bath

a

lenders took initial
Then slowly,
the mutual savings banks, the in¬
surance
companies, and, finally,
few

advantage of FHA.

recession,

1937-38

the

risks

look

at

15%

Hark back to 1934.

1951

Remember

ucuu

va

for

the

when

after March

Federal

Reserve

abandoned its price support

cessation of

government

construction and market activity;

precipitated

the almost complete

consti-

thev

starts

of the market,

decline occurred

A

record.

the

phenomenal. The breath¬
production year of 1950
(the year of VA credit .uuciautaliberalization) saw FHA reach a pinnacle
0f 36% of all starts. Together with
taking

tuted 51%

w

w

of the

bond
market
and
a
general
interest

w

in interest charges stemming from the drop in prices so acute that ra£e rise an(j
equipment financing.
trary, there will be

On the

con-

significant

a

scarcely
was

any

mortgaged property

worth the lien; the dearth of
money
by lenders al¬
badly hit by. foreclosures
depleted savings
accounts;

a general scarcity of
mortgage funds which existed until

the

middle

of

mortgage

got smart.

charges through serial pay¬
ments on
equipment obligations

ready

and,

Lenders

too much money

already

1953.

reduction in

annual

annual

inter-

est

outstanding.
Secondly,
this year has reduced

and

of

the

course,

widespread

pressure

they

When they didn't have
to lend and with

for higher savings yields,

abandoned

FHA

-

VA

No

can

one

and

vast

The unwarranted

involved,.

of this specious leg¬

until

islation

the

of

because

ducement

of

ai

cost."

on

question the need for
this legislation
during the war
when capital needed a special in¬

course,

c

based

loan

logically

By 1936, FHA had issued insurance 0n 5%
of all housing starts,
the

90%

a

"estimated

an

the savings and loan associations
awoke to its possibilities.

After

on

surance

in
1952 of a
melange of flimsy, frame, mul¬
tiple-units of inferior design and
appearance, requires closer exam¬

resulting

1950,

through

ination.

this

conceived

Who

postwar

,

program" under the
guise of the FHA label? It would
appear that another wartime ne¬
cessity, Federal rent control (the
"give-away

indefinite
became

which

of

continuation

objective

benign

a

of

self-seeking politician), had
indirectly clamped a tight lid on
multiple housing construction and

every

of the culprits in the per¬

was one

Rent control not

version of FHA.

only resulted in the steady with¬
drawal of residential space from
the rental

of the

because

market

it also

inadequacy of the return,

conventional

the

the company

made highly selective convention-

demoralized

the

al loans at higher interest rates,
This accounts for the FHA-VA

builder and discouraged new con¬
struction

drop to about 40%.

spread

by

unemployment. Only 125,000 nonoutstanding collateral 4s, 1965 farm dwelling units were started
$20 million, partly
through ;n 1934, only 10% of today's pro-

proceeds

the

from

Southwestern

the

of

Construction

Finally,

pany.

sale

Com-

there have been
market purchases

substantial open

Auction.
Into

disheartening picture

this

of economic stagnation came a
truly statesmanlike and imagina-

of discount bonds to meet sinking

live legislative enactment whose

fund

foundation rested on the concept

requirements.

these

of

various

indicated

charges

that

As

nual

rate

of not much

million

the

bv

this

.nn„ni

It is regrettable that institutional
lenders, whether because of a lack

is

fixed

interest

will have been reduced to
$23

of insurance—a form of insurance
where distribution of potential
losses was spread
among
the
beneficiaries
through
premium
Payments to protect the institutional lender against capital loss,

it

operations
combined

contingent

and

result

a

an

than

more

end

an-

of

year.
With

-«erial

no

mom

than

equipment

tho

obligation

pay-

money

policy

Since

was

a

cheap-

again

em¬

braced, the trend shows a strong
tendency towards reversal and it
may be forecast
government

that the 1950 high

of

participation in
private
housing,
aided by the
Housing Act, will easily be ex¬
ceeded.
Thus, we face not only
greater
intervention
under the

twin impact of cheap money and
cheap credit, but also the crea-

tion of a higher volume of housing starts. The ramifications of a

of/oncorted action, or ingenuity, housing oversupply will be dis-

did not institute their own private cussed later. Let us return, howmortgage insurance agency under ever, to the initial accomplishttfctearwould how out LS Participating stock ownership. In ments of this agency,
of reaching the W? rSlio
1
1
any event> the original purposes
FHA accomplished other early
of rharffpc lJto nL ™,lll0n level
of FHA were undeniably com- miracles. Certainly it contributed
I
1Qtrfig AptMon^ •+ -3r 01 eaf
mendable. By assuming the insti- to improved appraisal standards.
♦h0
u1S *"eported tutional lenders' risk of loss, mort- Let's face it—the appraisals of the
i1 exC £a&e funds, which had heretofore 1920's were strictly of the "windL of-posaibl?lty
a refund- been frozen, became available, shield variety." The magnificent
ments

regular

and

retirements

sinking

fnnd

nrolrPccg !

the

,

j

»+,.»+

♦

.n

g

fhon

operation

? ^ ,avera^£
bonds

vn

designed

to

reduce

.

-I

This

was

a

major

interest costs on its since economic

Many aaa*ysk>

?£5ci0n

are

consistently
over par

jicn woil

have

a

of

the

ing would
out

the

step

recovery

forward

selling
such

a

at a
proposi-

never

be possible with-

credit

accommodations

good chance of




The builder
tive

high

to

build.

now
He

loan-value

had

an
could

ratio

contributions

Frederick

of

in hous- cock and Arthur

Firct 4s, provided by mortgage lenders.

«

premium

existed

values

and

rents

of

modations

was

artificial
mation

unwarranted
in family

increase

as

a

an

chology

and
for¬

result of cheap rents.

the interim, the

In

in

The

further intensified

wholly

a

es¬

and

costs

construction

new

rents

real

pressing,
demand for rental accom¬

pent up

by

inflated

market.

inflated

the

controlled

the

and

tate

disparity

between

of

wide¬

the

of

uneconomic

that

rent

insidious
control

psy¬

was

a

peacetime function of
government
was
actively
pro¬

moted.

Think back to
program

was

litical dilemma!

by

an

litically
wanted

of

out of

po¬

Since the elim¬

rent

control

indigestible
to

a

Why not solve it

expedient?

ination

The "608"

1948!

way

a

was

and

po¬

no

one

risk the prudent long-

writings, in the FHA Underwriters\ Manual, plus the contribu-

tions pf the AIREA and the SRA,

incen-

made- mortgage

obtain

acutely

financing

Bab-

May in their

aware

systematic

and

bankers

more

of the need for

a

orderly appraisal

but politically unacceptable
solution of*' an
orderly, gradual
range

decontrol, why not attract equity
capital by the "handout" process?
These were seemingly deliberate¬
ly conceived handouts encouraged
by

responsible

Federal

officials
of a

charged with the execution
defective law.

It

was

a

matter of

in

continuance

sustained

power.

resisted the in¬
trusion of FHA into the lending

No wonder many

market!
The

tightening vise of govern¬
participation in housing is
better documented than in the

mental
no

knowledge that four out of every
housing mortgages is either in¬

10

sured

guaranteed by the Fed¬

or

of 10

eral Government; seven out

apartments! We will start 1955
$40 billion in private mort¬

on

with

debt

gage

in

Federal

the

which

Government is the guarantor

and

insuror.
What has been the results dur¬

time period of the
under the Service¬
men's Readjustment Act, the socalled "G. I. Bill"?
Designed to
ing this
VA

same

program

the

assist

to
liberal
basis, it contained (unlike FHA)
no provision regulating loan/value
ratios. The only restraint against
unprovoked 100% loans was in
the
$4,000
guarantee provision.
Those early days were the days of
purchase

-

returning

housing

the .combination

veteran

on

a

which

in

loan

of the

FHA insured the first

80%

value at 4%% and VA

guaranteed

the

top 20%, at 4%

interest.

An

but certainly liberal
the extreme.
It did not, how¬

oddity,
to

tion

yes,

achieved

was

liberaliza¬

Further

satisfy.

ever,

as

the result of

recessionary episode

the

of

1949.

housing continued at
the same level, it was deemed ex¬
pedient to extend the self-liqui¬
dation period to 30 years, and to
insure
the participation
of the
lender by raising the guarantee
provision to $7,500. As a Result,
we had the greatest year of hous¬
ing production in the nation's his¬
tory.
In the fall of 1950, costs
started
a
further upward spiral
movement which,
aided by the
demands of Korean War, reached
Although

higher

distressingly

a

necessary

r

and thus accelerate the pro-

gram.

because

and

which

factor in this
malaise, more sympto¬
matic than causal, was the dead¬
ening hand of bureaucracy, the
politically-inspired appointments,the
complacancy
indigenousto
contributing

A

lingering

by permitting FHA in¬

areas

war

fs" plications assume alarming pro- starts. The postwar rise housing
Stand total of 700,000 was, of
is, 'r7 ,of the past 20 years'.the lm~

toward the initial goal of $22 milRon

of

manner

originally a war-born measure
designed to induce private capital
to
construct defense housing in

inter-

governmental

of

distrust
vention,

ex¬

608,

VI,

in the un¬
risk.

derwriter's evaluation of the

Section

Title

completions

recent years of sub-

in

of sustaining the

means

total

severely restricted despite the destantial

1

the

of

continuation

v

still
still

Md
ana

control of
seized upon as
national
economy and of maintaining the
Gross National Product at record
levels through the device of credit
control, used somewhat in
the
the

Two,

hcusing has been

in

tension

a

of

value factors essential

year-to-year

enough

|10Usinj> market today. Viewed insurance commitments jose
(rom the perspective of the his- steadily by 1941 to 36% among a

sinking

S nrnSn, thl SnTn
Uw ab ffiv
iag aDiiiiy

A two-fold thesis will be pre- of instalment buying. .
.
...
rented. One, the public has sueBecause of the troubled times,
cumbed to the paternalistic con- an understandable failure to grasp
cept that
is somehow a .respon- the potential of mortgage insursibility of the government to pro- ance,
an
acute oversupply in
vide housing, either directly or many sections, and a deep-seated
otherwise.

necessarily

fortunately, the original high pur¬
poses and objectives of FHA have,
in
part, been perverted by the
heavy
hand of political
expe¬
diency. The deterioration is easy
to
trace.
It. started
innocently

calendar 7

50% of net income after all
charges the capital fund and the

year,

felt

doubt

no

FHA
could
rapidly! Un¬

that

inconceivable

aar*«— - - artsK-wrs
e*cefd$22million 5y

Administration then in power

cal

For

disadvantage.

burdensome, and often destructive, second mortgage. The budget-type, monthly-payment selfliquidating loan, originated by

omy

sentiment it is beiieved by those close to the situation that the major influence on
speculative

to any one cause; a

lender

conventional

commitments which, in turn,
eased building loan financing for
him and reduced the equity investment required to build. The
purchaser also had an incentive
to buy because of the new concept
of the low down payment, and
because of the elimination of the

sive evidence of a transition from
a! relatively free, unfettered housing economy to a political econ-

running below 1953 levels the
management might decide to cut

due

degenerative process was not

,

traffic

and

50%

about

still

many

variety of fac¬
tors was responsible. Most signif¬
to
their later chagrin that selficant, perhaps, in the decay was
liquidation periods, interest rates, the
postwar haste to
turn out
and loan value ratios were to be
housing for socio-political, as well
further
liberalized, putting the
as economic purposes.
The politi¬

Impact of Government's
Role In the Housing Market

In many quarters it had

yearend.
been

market a defin¬
towards lowered ad¬
ministrative supervision of Title
II—the bulwark of the FHA. The

ite tendency

felt they could

shares

probably came from man¬
agement optimism implied in the
declaration of a $1 dividend, the
same as had been paid at the 1953

were

though

even

the pass¬

with

and administration

could trace in the

pre-World War II
indeed
favorable

The over-all

Continued from first page

for the

Initial¬

layout, and design.

~~~
.

approved

the

cash

a

of Section
608 and its companions, Sections
207 and 213, the failure to tighten
up the provisions of the Title I
home repair sections until too late
was
symptomatic of the contin¬
uing deterioration of FHA.
One

ly, FHA encouraged new research
into
housing styles,
equipment,

email

+ho

oriri

;mnrm,omonfc

from

and specifications.

plans

with

Simultaneously
age

forestalled

practices

deviations

be increased to over $7 a share,

complete a
investment.^

investor would

enced

"608"

since jerry-building was
virtually eliminated, and better

view of the fixed sinking fund,

optimistic hope in

late in the
the close on Friday was
point below the year's top.

profit

some

again

It is estimated that with earnings at the 1953 level, a not overly

selling 75%

was

of costs adopted was so
that only the
inexperi¬

Although,

$20 million, dividend paying ability on the same net income would

success.

average

utary

If so, the ultimate goal
of charges below the $20 million
annual level might well be in

speculative features
strong rail market
Ohio com-

recent

has been Baltimore &

could "borrow

admittedly,
FHA
standards are minimum standards,
the effects were nevertheless sal¬

the combined charges are down to

The

out."

builder

liberal

providing for property im¬
provements through the capital
fund and for sinking funds. Once

Baltimore & Ohio

eral officials

the way.

common, even

after

knowledge . among Fed¬
that the experienced

common

us that
the security
absolute requisite to suc¬
lending practice. • FHA led

dawned

growth characteristics of parts of

25,1954

Thursday, November

...

plateau

about 15% above 1950 levels.

The

economic effects of this liberaliza¬

of

tion

credit

will

be

discussed

later.

recognized at the time
provision in the legislation
which permitted the VA to make
loans directly, at a limit of $10,000
each, in capital-shortage areas.
This represented an encroachment
Hardly

was

on

a

institutional

tives
the

serious

lending

enough

foundations

mortgage

of

banking

preroga¬

to threaten
the private

field.

This

statement may be decried by the

housing
fact

is

planners
that

this

but the hard
provision could

easily be used as a lever to force

Volume 180

Number 5380

*.

.

The Commercial and Financial Chronicle

(2173)

private lenders to make loans

on

terms which the government

any

deemed

expedient. If the princi¬
ple became sufficiently rooted,
Congress would hardly dare to
repeal this section of the law; the
law would become nothing more
than a weapon to enforce the gov¬
ernment's housing demands on the
lender.

It

the

is to

government's
that
the
direct
lending
has been used with some

credit
power

discretion

that

and

Congress has
shown wisdom in imposing a ceil¬
ing on the aggregate which could
be

loaned.

These

factors

Federal

Government

in

our

po¬

litical economy.

The depaand for
housing will be artificially cre¬
ated and sustained by politically
created conditions not by more
conventional phenomena as need,
purchasing power, and relative
scarcity.
Expediency rules the
roost!

Housing

been

selected

scraping
mand
of

the

bottom

barrel to

means

of

the

of

de¬

promote the end

and

necessary

eco¬

ures

stitutes

which will probably continue into
1955. The economy could receive

threat to the traditional

lender

the

to

and

savings of de¬

A third

phase of governmental

intervention

is

concern.

This

is the role of

public housing

as an

extension

of

the

of

welfare

state

concept, along with the social re¬
forms inherent in unemployment
and old-age insurance and minimum-wage standards as well as
others.

While

all

well-intended
to

in

circumstances
raised

are

intelligent and

people

others

see

would

like

better economic

serious

about

the

questions

means

em¬

ployed to achieve this ideal wel¬
fare state.

f

Better public and private hous¬

ing
the

in themselves be desir¬
political action with all

may

able

but

insincerity and the heavy cost

which it entails

scarcely an
raising
housing standards by production.
Public housing seems a humani¬
acceptable

tarian

it

with

seems

substitute

and

since

for

charitable

provides

housing

people
they could

which
afford

be

must

endeavor

few

a

otherwise

not

but

deficits

met

by taxing the sav¬
ings of those not permitted to en¬
joy its benefits. What makes this
little

neat

indicate

a

trick

immoral

is

the

those

that

tion

governmental

invokes low

greater
than

direct

is

rents

and

possible

ownership.

interven¬
at

total

a

indirect

under

cost

private

!

;

further undue

a

tension of credit.

As

ex¬

the

was

case

in the immediate post World War
II period, we now will see

higher
higher housing prices, far be¬
yond the justification for them in
and

terms of the immediate labor and

material

costs, and greater pre¬
paid for cheap money.

miums

Competitive
credit

ranted

for

creates

lush

unwar¬

price

rises; but, as the
artificially
created
continues, labor, mate¬

demand

and

land

costs

also

rise

as

demand

outstrips the
available
supply and inflation continues to
dizzier

ever

A

far

heights.

tragic consequence
for the existing home owner and
the
mortgagee is the imminent
danger of an overbuilding boom.
more

Excessive

indulgence

in

legisla¬

tion of the VA-FHA type exceeds
bounds of business prudence

the

and

economic propriety

ultimately
the

age

cost

only to

serve

distress

sell

may

and

and

encour¬

where

market

at

will

far less

than

tenuous

appear.

governmentequities will dis¬
Critics of this viewpoint

contend

that

paper

not occur;

dose

of

an

that

a

credit

oversupply need
still more liberal
will

continually
bring new buyers into the market
on
the wings of a rising popula¬
tion
for

in

and

light of a need
higher housing, standard.
significance has also boen

curve
a

Much

ascribed
in

the

to

so-called

stabilizers" inherent

"built-

in

unem¬

One

shaped

is reminded of the family ployment insurance, farm props,
making $3,000 a year who did social security, minimum wages,
qualify for a shiny new apart¬ "and other gifts to the electorate
ment at $30 a month and who
characteristic of a social democ¬
I groused
bitterly to his Congress¬ racy which it is claimed will tend
because

—a

a year,

his friends, making
enjoyed the benefits

discriminatory

immoral

concept.

the

eventual

can

be

New

seen

York

well

as

Some

outcome
in

of

as

an

hint

of

all

this

the experience

of

to create

floor under recession¬

a

tendencies.

ary

There

is

dis¬

no

pute

on
the general conclusion.
However, The human factor is
usually overlooked.
As long as
people are either pessimistic or
.

which has not
onlv state and Federal subsidized

optimistic,

and

as

Malenkovs

and

Mao

public housing but also so-called

create

non-subsidized public housing of¬
fered by the City at rents of $20

crises, mistakes will be made, eco¬
nomic maladjustments will inva¬
riably occur, and calamitous con¬
ditions, particularly when fanned

per

City

monthly
to
families
with incomes as high as $5,000 a
year or more. Of course, the nonsubsidy is a joke. Tax concessions
and unique accounting
techniques
room

make

mockery of the assertion.
The result? 85,000 public units of
all types and an absolute lack of
a

construction

new

come,

privately

economic

rents.

of

middle

built
There

housing
are

in¬

at

heard

hues and outcries from the press
and public while the
City argues
in vain with the State administra¬
tion for more money to relieve a

growing municipal deficit and a
mounting debt burden created by
a
pervading philosophy of "some¬
thing for nothing," "it's the gov¬
ernment's
rest

responsibility," and the

of the

charlatan expressions.
National
Housing Act of

The

tern

of

down

the

Decreasing

ed

very

well

Does

not

this

effects

levels?

Boom

dollars and real dollars.

Why add
unduly to the already heavy vol¬
ume
of private debt? There is a
widely circulated inference that

the more debt the better, because
borrowing means additional pur¬
chasing power, hence increased

production

and

additional

that

who

owner

and

saved

consumption
debt

so

is

has
to

tail.

own

ite

form

its

been

form

of

molded

tenancy,

eral

Government, the tenancy to
when, and if, the
of foreclosures begins. Does

it

not

logical

seem

that

the

ad¬

ministrative stewards of the gov¬

ernment,
inferentially
at
least,
might expect repayment of this
paternalism

in

political

loyalty?
particularly galling and dis¬

And

tasteful is the veteran home
who

er

gation

treats his mortgage

with

punity,
the

own¬

obli¬

casual

air

of

im¬

in

a

serene

belief

that

the
will

government

modify or
(the mortgagor's) obli¬
gations if a widespread recession
cancel his

initially

the risk, of the investment

as

-

to

the

a

neat

housing

device

under

the

underwriter's

tant

decisions

mortgagor's

to

a

and

new

VA

manifestations
lic

housing,

and
It

in

the

guise

the

of

needs.

Impor-

concerning

the

credit

standing, valsecurity, loan-value
ratios, interest and principal re¬
A

_

quirements
dered

to

1

have

the

•

i

»

been

1

_

surren-

appropriate govern-

mental agency.
Even

more

tinuous

alarming is the

decrease

in

importance

own

are

rent

only symbols
Its many

found

in

control,

housing

has

Government

Act.

conclude

to

become

identi¬

fied with the public interest.

Federal

pub¬

FNMA

Bankhead-Jones

and

to

cer

era.

reasonable

seems

that

are

housing

The

others

have

the

con-

and

Are

the

FHA

not

as

a

mortgage offi¬

Federal
and

Government.
VA

not

FHA

and

VA

betiOal

designations

form

HOLC?

the

of

a

new

Correspondingly,

borrower doesn't have to

ercise
sion
of

for

any

to

prudence in

purchase.

low

A

his

ex-

deci-

combination

down-payments

and

low

titled

can

has

it

and

new

can

better

prudently

housing
afford.
It

achieved

its purpose, not by
giving the housing away, but by
forcing cheap credit on the lend¬
er at possible eventual public ex¬

and, of

course,

ment

of

higher

the

to the detri¬
income tax¬

Thus, housing has already join¬
ed the swelling ranks of the pub¬

utilities.

No

doubt

the

idea

It is evident, how¬
present charac¬
private housing are
also true of the public utilities.
For example, in many sections of
the FHA there is regulation of the
rate of return, in the setting of a
standard
of
operating expenses,
and in the character and style of
construction.
Certainly there is
seems

ever,

housing which objectively is beyond their means.
Housing has also been desig-

strange.

that

teristics

many

of

the

as

Gross

main

National

prop

Product

of

the

—

so

to

speak.

evitably,

It has slowly, but in¬
dawned on many per¬

that

housing, through credit
and other
controls, could be used
as an
instrument for maintaining
a
high level of income, and for
eliminating the possibility of a

significant
Thus,

corrective

deflation,

if business conditions

con-

stricted, income fell and unemployment rose, why not give the
economy a "shot in the arm" by
liberalizing the opportunities of
home purchase? Since one out of
every six persons
is directly of

tive

need

for

it

(the
lender) to those who do (the borrower). When purchasing power,
aided

Thus,

heritance

new

housing through the rela¬

has

a

a

significant impetus. As
solution,
this
has

short-run
is

obvious

that

this

was

a

motivating factor inherent in the
changes incorporated in the recently enacted Housing Act. The
record spurt of activity in the past
three

ir:rp .<>

-

the mechan-i

TUn

The

be

now

dis-?<
,

economic

conse¬

themselves would be try-

quences

hig but the political

consequences

of disavowal would be
disastrous.;
hesitant step in that direction

f 7r \

!•

airecu.on

taken by attempting to raise
mir« !
?
but. the
£
mitigate further mflarr
by drying up the depiand for?
j

credit accommodation raised
a storm
of protest that, the

such

policy

abandoned in June

easy

money

^
J,

1953

reinstated

was

and

with

Housing

n m
.

11 1S becoming increasingly

ap-

Parer*t that forecasts of housing
Production must be reflections
those policies which are necessary
to sustain our political economy,
Wtih minor, provincial exceiptions, the housing industry does

n°t 1s^m_ destined to operate as
a relatively free segment of a free
economy sensitive to traditional
demand-supply factors. Governmental intervention has artificial^ed
demand for and supply-

housing, making these factors

dependent
thus

credit

on

indirectly

competitive

terms,

and

influencing
of

processes

the
price

determination,
The

form

and

housing provide

substance

some

of

significant

discrepancies.

The form is easily
apparent, standing out in bold
outline—the continuing increase

of

governmental

control

of

through

the

regulation

housing

multitudinous

and

industry
govern-

ment agencies. The substance is
*ar more shadowy, requiring careful and penetrating insight. WhaS
emerges is a pattern of the grad"ah but inevitable, socialization
of housing while at the same time

maintaining, with paper equities,
the fictional form of private ownership.

appeal.
It

cannot

OITAlXrorl

a vowed.

the

foundation of the economic house

sons

payer.

lic

afford

nated

:
and

economy

isms of government have been
geared to an annual housing production in excess of a million
units. This perhaps unwanted in~

alpha-

mate

immediate

Our

Could

become

indirectly employed in the building industry, the economy could

no

»ociallsts«

appraisals

accented in lieu of his own?

receive

modation, that is, the transfer of
purchasing power from those with

^rer^c^.ed legislative acts of , the

was

control of the rate of construction

meaning¬
as prices and incomes
This ignores the legiti¬
purpose
of cred'.t accom¬
long

If Pr°blem by direct or indirect
payments, A situation

subsidy

prestige.

of

as

which

lender's

credit standards have lured many
families into the belief that they

to

seg-r:

populace

A

insidiously
promoted
the
psychology that the public is en¬
than

voting

e

control

uation of the

dicate his role
FHA

the

had

government—incidentally,

very

risk

have

may

forgetting that the "gov¬ His
judgment
simply
doesn't
is
nothing more than count any more.
He
has
been
forced to surrender control of a
already overburdened
tax-,
payer.
portion of his business and to ab¬

of

as

may res.ult m which there can <be>

the

Housing

,—

moves

entice a few votes from that

ernment"

New Era in

all the while

—

is unaware of the
*
Quenccs. In order to sustain votwg*
would not be surprising to sdlVe:

insuror into the tra-.<

or

rise apEice.

less

And

occurs,

The

It is/

means

.

well

a

dependent for
upon
the
Fed¬

be consummated
wave

the

on

no turning back, .much like that
which confronted Churchill's*
nothing but beneficent intentions, Conservative Party when it re->
although
subsequently
debased turned to power after many years
bv
political
overtones
has
®
Socialistic rule.
They found;
usurped the lender's.prerogatives
P°litically impossible in many;
by transferring the processing, as Jnstances to reverse the deeply «jr*i

of ownership

continuance

might think.

as one

market

injection of a third party,
Federal Government, as a

which

in¬

an

under

'

far-

as

lender in the exercise of
ordinary.
business prudence in the conduct
of their affairs. The
government,

buyers had not been bailed
by further inflation and the
creation
of
spurious
equities.
Home ownership, in these cases,
has become a myth and a fiction.
has

not

inexorably to its
locomotion, housing destruction, the political,
proponents of this thinking may;

mental

mortgagor-mortgagee relationship has reduced the responsibility of both borrower and

cash"

form

is

ditional

out

There

idea

•

_

inflation which not only removes
housing from the reach of ^the
only mass buyers in the market-s¬
e lower middle and middleclass—but also threatens the in-'
vestments of the legitimate equity
holders in housing.
•V.;

its

favor-

a

The

evident if many of the "no-

choate

The

a.

,

re-

to be

:

same time creating a price

would

It is

need

subsidizing housing surpluses,
als
of
parity to maintain,

persons

it

which

the

in an oversupply of housing while

seems

chasing

dog

these days.

lot

a

effect

seems

of

th,e

been

very

in

with

by which the government plans to
extricate itself from this dilemma
which they alone are respon-,
S1ble. Successively more liberal
?redlt terms will invariably result

the

of

of

the

finds itself

now

interesting to dwell

their

It

form

Will

that

as

100%

fetched

time, advoeasy credit
without realizing

the

It

guarantor

housing, and other activities

socio-political and economic need.

of

cline.

have

because

this

end?

inner

at

gov-

in

interest yields.

on

out, if and when real estate
prices sustain a significant de¬
would

undue

is

to

status

same

for

same

depressing

Where

U, S. agriculture

be crying for a greater
their institutional sav-.

at the

mindful

fade

This

the

because

yield.

the

themselves

have

a

payment, conse¬
quently takes no pride in his
house, and who, when put to the
test, will not fight for it but will

more

also

that

on

are,

the

never

make

to

to

and be confronted

eating and promoting

reasonable down

of successively

higher
prices only
provoke more hardship in the dis¬
parity between nominal (inflated)
price

ings

only

cons*-^

expedients of
those planlegislators who create

going

prices?

not

interest

may

for

pense

reasoning also
conveniently ignore the deleteri¬
-

The

as

long-run

these

concern

housing industry eventually reach

conse-

aggregate
the extent

participation

but

return

com¬

while real-income does not.

Title II loans from 25 to 30
years
is only a further extension of a




can

who

and

or

the

requirements and
extending the maturity period on

is apparent that
housing
become a major interest of

Tungs

international

status,

the

opposed

are

affairs,

munity affairs.
(3)

loans,

lowered

tenancy

sacrificed

GI

incredible

who regards his

interest in civic

no

easy

mortgage rises.

they

nature.

transient

in

portfolio

ernmental

carrying charges as a form of
rent, places himself in an almost
takes

the

1

and

elementary illustration
owner

to

them?
mania

the

of

and

ners

rest

Most
private
lenders
would
shudder at the thought of a portfolio containing 50% or more FHA

prop¬

human

mort-

a

Are

real

any

i
the lender's government-back¬

of

erly than, say, his car in which he
has a $500.00 equity investment.
of

yield

mortgage

For example:

an

as

re-

ultimately

may

advocates, with the

homeowner.

is

survival

surrendering

average

This

The

compete.

arises:
quences

quent loss of interest to depositors
occasioned by a lowering of the

stimulated

has

the

payment

It

credit,

easy

the

as

Tse

that

money

housing,

by imprudent credit ex¬
pansion, rises higher than
in¬
creases
in volume of production,
prices and money - income rise

to bring the pat¬
last .20
years
into

focus.

recurrent

long

happen.

ous

and

of

availability or paucity of
mortgage guarantee or insurance
commitments, or through the sim¬
ple device of liberalizing or stif¬
fening down payments, interest,
and
amortization
requirements.
Governmental
participation
through rent control, mortgage
guarantees
or
insurance provi¬
sions,
credit restrictions, public

1954 has served

sharper

by

concept

to

lender

on

by .gov¬
ernmental credit control, has also
produced a unique new class of

not

man

new

is

gage

chaos.
The

increasingly more diffiprivate, conventional lend-

sources

suit

higher prices which may
eventually
provoke
economic

man

$2,880

ing

for

sures

of

pressure

rial,

bidding

terms first

created

ous

by

economy

who do not but

government administration of
this program, it also seems obvi¬

spurt

a

long-range results are the
same, however, as with all prior
instances
of
"gassing
up"
the

homes

of

the

to

proportions.

The

•'

altered

it

cult for

more

concept of creating new debt. This
glorification of debt creates pres¬

(2) The

realization that the votes of those
who qualify far outnumber those

who, by reason of
income, must pay for the housing
of others.
Charity, yes, but by
political compulsion, not by com¬
passion or suasion. In the process

record number of starts

a

significant impetus from

of

positors.

has

made

cre¬

printing

provide^ v- (1) The owner without a finan¬
such a result. Housing fig¬ cial stake in his
housing, who is
for August and September
less inclined to maintain it

obviate, however, this basically
dangerous provision which con¬
a

concept of

by
been

money

money

nomic adjustment. The short-run
effect may incidentally

cannot' just

independence of the institutional

time honored

ating

apparently

the

as

normal

a

has

the

37

months

has

been

nothing

short of phenomenal and seems to
coincide with a general upturn in

business.

However, this question

The government's resolve
to pu*
family into a dream cottafge

every

will necessitate the
projection "o?
the dream cottage into the

indefi^

nite

future,

electorate.

by

demand

of

the

The

people now nnconsciously demand favors in nrin

.

,

Continued on page 38

,

The Commercial and Financial Chronicle
38

Continued

ernment in using credit as an eco->

from page 37

nomic rather

than

The

answer

return

Impact oi Government's
Role In the Housing Maiket

to the

a

n0t

does

ne

m

a

lending practices of

end

the

invite

to

as

decrease and

will

income

home owner, and

ally beget the presentation of alternatives. Is there any real solu-

transfer

private

lender,

of

fundamentals

the

of

of FHA.
too

transfer of owna
brilliant
and useful concept to the stand-

Thus, at a moment when we ai-

return

of business pru-

and morals

tions

self-interest.

of

There

band concerts.
band concerts.

;

and

cities

when

-

counties

have

tenders'

tion

are

a

social responsibility of gov-

price maintenance laws for retail-. 0f cities of 50 000-100 000 persons
county agents and.crop sub-. wri be from $3-10 million a year
sidies for farmers, npre pay for (New York's is almost $2 billion )
school teachers and policemen, state budgets run from $35 miiers,

and at times the reasonableness of

Federal

argument of such organizations or

Ron.

can

a

legislator resist the

pressure

'Ron

to

billion

a

and

government's

a

half
is

The

*65

hil•

Credit has been selected asi associations—and keep his politt- ' Now the dilemma: large-scale
the mode of control. government cal 0ffice?
,
governmental
operations
need
pressure groups are neces- trained
officials
and
ownershjp has been rejected as
These press
personnel
obsolete * in
this
modern
and sary to government. The individ- adequately paid and protected in
devious form of socialization.
ual today is too dependent upon' tenure under civil service or sirii-

ready have 46,000,000 housing
units for our 162,000,000 people,
dence and; to the calculation of the lender may be castigated for
economic
(rather than political) his caution.
risk and away, from the* temptaThe lender's basic policy of cau¬
ards

pressions. to • local governmental taxpayers' associations,
comforts such as public parks and. _But it is a different situation

(2)

depositors on reasonable grounds.

This proposed

would

a

undoubtedly

axt
A,rtv,0r
onnmonhmpntc

politics.

the first to consider, him
graspihg if mortgage. funds on
easy terms are withheld from the

long.

ership

ing

among

the shelf

on

are

vuiwo

from Federal protection against view of their locality. Under suqh
external enemies and internal de- conditions there is less need for

ernment. It is promoted under the
fiction of paternalism but is for
political rather than economic,
sociological or h u m a n i t a ri a n.
needs;
such is the heritage of

type must be done dislest the public mistake
their motives. It is an oddity that
a
lender's
own
depositors are

of this
creetly

before the creation

It has been

Others

tration^^nhTttie

A. campaign

social responsibility.

insurance
to
private
stock ownership and away from
the influence of politics.
This is
not a new idea.
It was proposed

mortgage

and discussed

gvuu

rectly seek the aid of the taxpayers for necessary civic projects,
Also local officials usually are political amateurs in office on a part¬
or full-time basis for a few years
with intentions of resuming their
regular occupations. Thus they are
apt to understand the points pf

sons will be stated concisely with
the reminder that numerous qualifications will have to be omitted.
The first forecast is based on
the belief that we the people shall,
continue our demand upon governments for more and more services. ,< Such services will range

.

acting individually or in concert? It
would appear that the only chance
of breaking
the tightening iron
vise of governmental control is to
actively seek and work for the
the

States Collest More Taxes in 1954
wW.
m

None of us will desire the whole many thousands of - inhabitants
pew rea]ize what their ran&e °* functions.
Indeed it is and when governmental problem*
tary restrictions are questionable ^ctTvTues are'nrovokrng-* othersTn Possible that substantial numbers move to the state and'Federal
public relations.
,
.
government are manipulating of citizens will oppose each ex- levels.
Public officials no longer
Recall the public outcry when
strings
v
tension of the government. But. are in daily touch with taxpayers;
the supply of 4% VA mortgages
® *
each of us is directly or indirectly a permanent officialdom becomes
dried up in 1951 and 1952. Any-- ^
review,; it is nam to una a member Qf a pressure group established, headed by profesintimation that all Tenders were any
larorame iactors tor tne (i0bby) which tends to identify sional politicians who give fullrestricting their participation in economy^ or^tor' Tne lenaer. i e the welfare of its members with time to their ''profession." Such
government-backed loans might following conclusions seem sen
the pr0gress 0f the city, state, and conditions are necessary because
provoke public outbursts against evident:
nation. Tariff protection for cer- government operations have bethe lenders as lacking a sense_ of
,(1) The trend is to make hous- tain businesses and labor unions, come big business. The budgets

the lender.

Criticism, no matter how constructively intended, should logic-

for

do

£ juu.

ments. .This places a burden on
all lenders.
It requires a lot pf
discipline to resist the temptation
to make risk free loans.
Volun
to make risk free loans. Volun-

"

tion

14

the Federal level, least for local many individual residents who
governments.
can express themselves directly if
defaults
There are several reasons lying local services are not satisfactory,
10% to behind these forecasts. These rea- And in turn the officials can di-

invest-

existing

owner's

home

only nominal dollar incomes will
rise.
Each of these alternatives
bodes
ill for the
investor, the

page

evds ot the second mortgage and,

in

real

from

down%aymenteC°iTtoeinvU?Sthe

to insist on adequate down pay- Cagh investments from
ments on 4%% VA loans. It is 25% depending Qn price range
conceded that this is directly con- are normany sufficient, provided
mately witness the absolute ab- trary to the purposes of the Home the seif.liquidation period is not
surdity of 80% of families own- Mortgage Voluntary Credit Pro- excessive
Loan-value* ratios.
ing their own homes, many ten- gram. ' Nevertheless,
not only shouid Dg flexible depending on
uously, with the chaos of over- will this abate the inflationary the period in the real estate cycle,
supply
solved
by
government pressure
engendered
by . easy
nothing hut the hiefrprice supports, or subsidies, or credit, it will also tend to reduce
An^n jo , o
g
s
cancellation of contractual obliga- the supply of housing to the point
mui v
yhousine
tions, or further inflation, where where it does not endanger the
.
Th
*
well

as

Continued

political de-

public housing,
Unless something is done soon to
reverse
the trend
we will ulti-

vate

..

Thursday, November 25,1954

...

(2174)

Housing

(3)

has

become

the

handmaiden of the Gross National

others

economically,- political^/ Rar merit systems. Yet such

socially,.'to. be a lone wolf.

But J ditions drive

a

con-

wedge between the

arises

seemingly insurmountable
cles. The first is the legal
culties implicit in state reeogni
tion of a privately operated mort
gage insurance
agency which risen
much higher than other
y-.,
to, be-avoided.
;
; the taxpayers,, and the individual
wpuld* supersede' state banking commodity costs in the last half- of the promulgation of the weiAnother prediction'-was. that thetaxpayer must croup with others
...
....
.....
and savings laws. Another is the century, resulting'in less housing' .fare state; the emphasis is on the
ntury, resultingin
fare
(adjusted) rate of growth of taxes! because in a large community the
lue for the dollar
outright reluctance of government value for the dollar.,.The fecQltfs. welfare of the individual rather, would be greater for the Federalvpower of the average individual
The records
to surrender a. good thing.",After support this viewpoint:
PPort this
' !■ tham traditional reliance on in- government, than the-states, and- |s negligible. -As mentioned -■
*
than
on in-"
- beall,,FHA andiVAna&a credit de-:
(l) From 1900-1920, fost-oF-liva> dividual initiative:; It- nravheenthe; states than the local govern-; fore such, alertness will make .the
..T—.

—i———

.

vice

be

can

used

as

narcotic

a

doubled

ing

construction.

while

b^ef?ts: ments' The highercthe level of

tired businessman more tired and
: government, the greater the; di-lhe busy housewife busier became
(2) From 1920-1950, cost-of.-liv-?
. . . . versity of available tax bases, and; taxpayers'
associations
require
business^set-back, a. set-back*par- jng increased 6p% while cdugtruc(?)
lenders independencef?the power to collect revenue; Towork;' But the alternative* is .the
tiauy of; the, governments own. tioh costs have increased 120%.' 1S .seriously threatened; .the gov--* be sure there are apt to' be con^ growth both of - impersonal, goymakwg;
,Jhe government & con.
it* is " obvious that con- e,rhm®n1t has Pre-empted not only- stitutional ■ limitations on the ex- ernment and of taxation out of
cern&
ov^ this eventuality, may be;
costs
have
far
oute ns^s
sdmrnistrationf ercise of^-taxing- power, but con- proportion, to services rendered,
mprx* political than economic.
eenof the loanst and relegated the, stitutions can be amended^
W
tq relieve, or as. an antibiotic to
cure
the prospect ol a serious

costs tripled. :

—*

/'

£ I nntMSftted
? is not entitled.

-

.

,

,

.

.

T^e nfct °^iou^^e|is for the
twntn
VA3,
^^p'eater extern-to FHA
.

and^ VA

lender to the sidelines;

/Closely tied to this same-Prep n
'
(6) The tightening vise of gov-: dictionTs the observable tende^;'tatOII^«:''COa; UVTOfS " :* ';

erah 'Thefiundamental reasons are
that material costs (such .as lum-

ernmerrtal control- threatens the.
deposits of the investor; his sav-^
mss may be dissipated through
cheap dollars and cheap interestHis status is similar to that of the
pensioner and annuitant whose

toward a centralization ombigher^
v . .
governmental levels of^■- pohticaf nfV-m~ llal RfiSOUfCflS T
and social controls. The period of"
;
^^vest his cymstantly conventional Rave lagged behind other indusgrowing inlocal governments' dominance in ftjinfiMAIft QIaaIt oft
flated idollars
im
iriejg> and; last> that labor ig nQ_
an individual's-life is pretty muek JWHMiWHI, wllCIl Ol1 ^ r. •'
loans or s uff l c le nt. attraction,
toriously unproductive, partially
a thing of the past, and even the.Eaton & Co. Inc., New York
urreaters. participation
in governReCause of technological reasons savings buy constantly less goods, state? in certain spheres are giv— City, are offering 299,509 shares
PaP?F ffemS; lnfyi- and- partially because of union His recourse is withdrawal of de- ing way to Washington. With 0f common stock (par one cent)
table.
**.itn amortization flooding
poRCy# B seems obvious that con- P°sh savings for inflation-hedged greater responsibilities go greater 0f
Arkansas Natural Resources
-

ljstruaon. It wall; The difficult in
be lender to,
for
the' long- run

ber) haVe risen.higher than gen-

;

^ costs; that technological improy^rnents

in basic construction

,

whk

witn

in,

witn

savings,

rising

a

general mliationary tendency ere-

struction
rjse

costs

will

continue

to

investments.

expenditures—thus

the

Federal tax trends.

emphasis Corp. at $1

RjgRer than costs in general.

(7) Increasing government con-

A* first thought, this may seem
favorable factor for the lender
sound' conventional- morteace in
—continually rising costs may bail
vestments which meet his stand
him out of poor loans. But price
ards
rises usually create commodities
•f w'h.t
ur™
of lower Quality by way of com+yP ? T7.???o s*?ould, De pensation. Housing today, de-

trol of the entire fiscal and monetary structure, plus the economic
stabilizers now entrenched in our
economy, could prevent a depression of the catastrophic proportions of the 1930's; yet only a
relatively slight general down-

Can anything be done to break
this trend of increasing tax bills?
The answer is No. Probably thebest prospect is to slow down the
rate of growth, though this procedure is not easy. Fundamentally
the procedure is to have an active

trend, plus a'concurrent oversupply, could wipe out many
paper-thin equities, particularly
spurious in- if it arose in the more immediate

and sustained
participation by
taxpayers in government.
This
requires time, work, money, and

"wRl have^a ^ontfnuallv

lender

difficult

more

nroblem

find

to

a

.

insured through FHA.

Any loan

which

viewpoint

nas

the

in

basic

lender

merit

s

but

where

MI0' 0r*i?Ie

the

spRe the fancy kitchens and baths,
represents a significant net decline
in real vajue
Thus high

housing costs have

a

a

the mortgagor does gredient, and, if a general real future.
reauirementTshould Wirallv "hp estate recession' ensues, housing
(8) The
fpt

nnt

insured^aealns^loss ^FHA^ppn

_

lower

sparingly as tlm supply of funds dictates, to relieve
the pressure of excess funds, and
ta-maintain mortgage investments
atf

a

reasonable ratio, to

depositsi

than
rate

These

are

transfer of FHA to private hands

howlers.

might be further explored.

the housing

* ;<

The.

last

possible

would be for

lender to
in

a

centage

loans

of

alternative

institutional

every

participate

program to

hacked

'

voluntarily

a

than

construction

on

a

of

us

all sobering thoughts,
like to

be

If restraint i&.

sound

industry

calamity

their

a

certain

portfolios,




and

a

spec.u-

It is intended to use the net
proceeds to pay ; for drilling of
test hole and coring, and any remainder for working capital and
other general corporate purposes,
Arkansas Natural Resources
inrnrnoratpd

r

__

f.

in

n^ia-

ware 0n May 14» 1954 for the
purpose of exploring for mag-

organizations, e.g., taxpayer netite iron

ore,

uranium, mica and

or

basis.. The

remain

by

more than 13,500 acres located on

by

or

by- rent

housing

control

in

the

trend

donet little
(thus

now

would

opportunity

self-regulated.

burdens.

removing

halt the

:

onward

nancing, there would be outstand-

"/
•

UstopoZtimiof govenmeS? iS

; answer

common

AJJ

.

to

:-Werthe,mer AddS

:

CINCINNATI, Ohio-Paul M.

If the units Hush has become affiliated with
government are smalk q Westheimer & Company, 326 Wal-

is conditional.

be the last possible of local
to

The result can

be the growth of bureaucracies ing l,049,500r shares of
indifferent to public demands and stock.

Although the present Ad-

ministration: has

restraint: alter

ratios,„in-

are

urban

involves not only the lender,\ in: the^ issues from partisan politics),

adjusting-loan^value

Giving effect to the present fi-

subsidy

public

guarantees,

areas.

exercised;.s .,(9)

can

limit government., terest, and amortization, but also
to

or

ance

payment,

None

as

commodity underwritten and sponsored by ciations but the basic one is the the Magnetic Anomaly at Rison,
much more accel- government; by mortgage insur- fact that governments usually are Ark.

costs.

Concurrently, the prospects of the

share

°ther

Prices and at
erated

group

per

lation.

-

civic associations. There are a
eventual housing pic- number of reasons for this emis for all housing to be phasis upon such protective asso-

values will decline a lot faster and ture

be used, as

on

fT fo'^Snce^thTcWef'SMU- nUt Stre€t' members of the New
tive^nd

per-

the builder, in adjusting his pro-

rush of socialism by putting the

and

duction to demand, and the gov-

control of credit in private hands, ployees are known personally to

other governmental em-

Y°rk anti Cincinnati Stock Exchanges.

Number 5380

Volume 180

The Commercial and Financial Chronicle

.

-The followingstatistical tabulations

^

latest week
week

Business Activity
IRON

AMERICAN

Crude
'

42

oil

output

Kerosene

output

Tov. 12

—

(bbls.)

(bbls.)

Kerosene

6,195,950

gasoline

at

(16,883,000

6,941,000

6,765,000

24,161,000

23",069,000

23,095,000

2,395,000

2,278,000

2,220,000

10,330,000

10,163,000

7,850,000

7,839,000

7,531,000

12

36,775,000

38,178,000

38,796.000

13tl98,000

133,253,000

56,068,000

56,469,000

56,184,000

51,194,000

'"'695,097

721,402

727,058

611,756

596,381

(bbls.)

at

(bbls.)

at

ov.

AMERICAN RAILROADS:

f.

CONSTRUCTION

ENGINEERING

CIVIL

708,757

__r_

616,777

Total U. S. construction

„

" Public

-

w

:

*

construction

___

coal

Bituminous

and

lignite

Electric

*

(in

output

$244,704,000

175,680,000

103,123,000

Wholesale

119,245,000

210,153,000

147,556,000

141,581,00c

Retail

78,547,000

152,232,000

95,998,000

107,074,000

Construction

40,698,000

57,921,000

51,558,000

34,507,000

INDUSTRIAL)

AND

*

<

*

.

.

i
.

tin

Straits

at

'r

,

A

.

at

—

,

i__
!

—*

AVERAGES:

Aaa

-,±u

-

:

:

-

,

-

" Railroad Group

'

Group..

;

___

INDEX

COMMODITY

NATIONAL

PAPERBOARD ASSOCIATION:
(tons)—,

Production

(tons)

Percentage

of

—

activity

at end of periods—-.—*.

(tons)

Unfilled rorders

—

._

Ol£, PAINT AND DRUG REPORTER PRICE

INDEX—

*

EXCHANGE

-

v

—

—±

30:800c

30.500c

28.450c

92.250c

89.875c

93.000c

83.000c

15.000c

15.000c

15.000c

13.500c

14.800c

14.800c

14.800c

13.300c

11.500c

11.500c

11.500c

10.000c

'Dollar

value

>

110.70

Gas

Household

Men's

Round-lot

Medical

103.97

Personal

Reading
Other

2.89

"v+

v

/

r

2.86

lf

3(39

3.12
'

2.87

3.04

3.04

3.13

.4

3.45

3.45

3.23

3.22
3.10

:3.38

3.05

£-■

1

■

EXCHANGE AND

99.0

Total sales

241,538

•

93

95

447,385

429,295

480,726

106,17

106.23

106.16

1,112,144

.

specialists in stocks in

$44,380,898

$53,905,208

964,419

1,077,482

10,158

6,934

7,808

6

908,404

957,485

1,069,674

•

500-lb

of

Sept.

1———:

353,790

255,970

$48,536,929

—

1

286,220

301,530.

10,873,800

10,804,790

10,148,980

OF MEM¬

'

—

Oct. 30
—Oct. 30
—Oct. 30

Oct. 30

——Oct. 30
—

—

—

—:

for account of
:
—:
.;
__L—

;

PRICES,
(1947-49

NEW
==

SERIES

—

members—:

4.31

5.60

6.02

6.12

6.93

4.82

4.64

5.36

;

4.50

4.43

4.39

4.45

2.77

3.35

4.46

5.59

£18,426,000

£43,095,000

£16,795,000

$2,130,872

$2,081,277

$1,640,883
30,980

IN GREAT BRITAINLTD.—Month

Oct.—

of

omitted):

of

Oct.

...

margin

carrying

hand

debit

net

to

accounts—

balances——

35,567

33,742

329,750

323,757

923,796

924,179

672,031

148,162,510

150,658,921

115,428.148

109,395,338

customers—_—__——

and

S

U.

-

shares—

bonds

listed

of

value

in

credit balances-

free

listed

of

value

banks

In

customers'

_______

109,349.656

94,571,815

293,403

156,655

borrowings on other collateral

.

168,476

128,008

1,474,690

1,437,260

1,120,963

2.45

U. S. Govt, issues.

Member borrowings on

RECEIVED

FARMERS

BY

INDEX

—

OF

AGRICUL¬
Sept.
15:

of

'

Unadjusted—
All farm products

207,320

232,110

179,830

990,600
1,197,920

1.000,860

926,270

1,232,970

1,106,100

-

farm and foods—

»

.

0rd!rs

not

reported since introduction

2.32

2.28

2.10

2.07

4.44

4.30

2.92

2.88

—

Livestock

343,010 '
31,400

343,680
2(L200

25,470

20,400

310,330

302,460
327,930

229,450

472,130

347,880

286,500

2.19
1.85

2.07

2.94

2.63

2.76

crops'—.

and

•

*

products

animals

2.35
2.23

2.45

—

—-

2.51

2.76

2.77

__________—__

—

2.87

3.05

2.53

2.45

2.05

1.62

1.78

2.29

209,050

330,530

"

2.48
1.70

Dairy products

221,210

2.13
2.05

4.30

■

1

—

Oil-bearing

355,090

„

Poultry

OF

——

eggs

,

MARKET

TREASURY

U.

TRANSACTIONS IN

GUARANTEED

AND

RECT

484,020

A.—Month

S,

29,550

Net

sales

417,937

374,180

280,315

Net

purchases

478,325

484,987

438,480

2,008,390

1,981,230

1,748,810

1,251,940

292,690

319,360

269,600

185,390

DI-,

SECURITIES

October:

of

$9,981,150

309,865

67,050

53,970
424,355

:

64,300

U.

1,738,645

1,729,127

1,602.910

1,042,29

2,031,335

2,048,487

1,872,510

1,2i27,685

S.

I

:——

*

*

GOVT. STATUTORY DEBT
of

October

face

amount

—As

Total
at

31

(000's

—

-

$16,970,000

LIMITATION
omitted):

that may.be

outstanding

$281,OO0,OOG

$281,000,000

$275,000,000

278,752,052

274,809,874

273,386,221

33,615

28,530

65,939

$278,785,607

$274,838,405

$273,452,160

531,100

time

any

$21,050,400

533,790

577,108

$278,254,566

$274,304,614

$272,875,011

Outstanding—
Total

public

gross

Guaranteed
109.7

109.4

109.8

92.2

91.4

93.2

103.8

*104.3

103.3

85.9

*87.4

85.0

84.5

114.5

114.5

114.6

114.6

§Based on new annual capacity of 124,330,410 tons as

of Mon thly Investment Plan.

debt

obligations

not owned

by

Total

gross

teed

Grand

total

face

debt

and

public

debt obli¬

debt limitation

outstanding

amount

above

of obligations,

authority

guaran¬
—

outstanding

subject to

gations not

under

public

obligations

Deduct—other

Balance

the
:—

Treasury

103.9

Nov. 16

—

*'

688,37(

Meat'

291,660

______

——

crops

552,930

323,690 '

'

A

hay—

and

grain
Tobacco

135,440

.—I—-—

——

Fruit-

93-0

barrels of foreign crude runs.
nf 11TSd7 47n tons
1, 1953 basis of 117.547.470 tons.
1

.

2.55

2.50

2.33

Crops *

Tfuck

109.7

—Nov. 16

»

2.51

2.47

Food-grain'

■

744,230

1,109,270

Nov. 16

against the Jan.




)

Oct 30
Oct. 30
—Oct. 30
Oct. 30
U. S. DEPT. OF
—

f,rincludes 635,000
Ilguie.

(Number of

1,165,420

Nov. 16

commodities other than

as

1,181,360

100):

products
foods

1954

Oct. 30
—Oct. 30

—

commodities

1

$30,248,000

(24)__

—

EXCHANGE—As

extended

Market

'

—

—

sales

"Revised
T,n

$29,929,000

3.00

firms

Cotton

*

Oct. 30
——-Oct. 30

—

sales

.Do„,dH

of

16,465,000

"

,

1__

the Tloor—

!—:

i

Processed
All

12,511,000

4.57

customers'

of

"

Oct; 30'
^.Oct. 30

Commodity Group—
Farm

f

.

OF

—,—,—ii

BANK

(000's

on

7,014,250

i——Oct. 30

Short sales

All

*

230,400

330,700

.—Oct,-30

j—

initiated off the floor—

sales _!—

—

'* *

Oct.:

of

incl. Amer. Tel. & Tel.)

STOCK

Cash

317,530

—._———

purchases

LABOR

YIELD

—

YORK

Credit

6,696,720

—

purchases

WHOLESALE

"

.

$29,981,000

(200)

Total

192,500

291,700

401.910

__t,

sales

Other

10,768,648
.

13,206,000

—

(10)

Market

353,790

,

9,747,070

purchases

round-lot transactions

Total

118.5 a

1:

omitted)__——

(15)

Member

'

255,970

Nov.

——

CAPITAL ISSUES

NEW

192,500

291,700

434,770

Total sales

*

107.6 ?

OF

DEPT.
of

AVERAGE

(25)

(not

Insurance

$23,400,649

10,370,020

Short sales

Total

112.9
'

;

9,670,474

—_

STOCKS—Month

(125)

Railroads

612,135

413,370

:

Total sales
—
transactions

Total

120.2

bales

(000's

30

WEIGHTED

Total

$41,946,630

$41,411,831

—

gross

COMMON

.Utilities

6,075

10,460,430

—_^_uj.__—

———

Other

'

106.6

bales)—

NUMBER — U. S. DEPT.
TURE— 1910-14 = 1(H)—As

which registered—

sales

vjnier
Other

113.4

106.5

120.1

115.3

Kt

Industrials

618,21*
"

Jet. 30

—•——

_»

transactions initiated on

Total

113.5

——

—3

100.5

639,953

$27,813,028

950,206

977,420

Oct. 30

Short sales

i

122.6

107.5

*

Feed

Short sales

Other

125.5

——_—„—

(running

•

__

Total-sales
Total

130.7

125.7

S.

Average

6

SPECIALISTS:

Other

126.6

as

KM)

256,655

—_i_

purchases

Other

92.5

126.4

i—-w-ai—■'

PRODUCTION

—As
!

227,846

252,442

-

;——

—

Transactions of

'

90.7

U.

PRICES

—

ROUND-LOT TRANSACTIONS FOR ACCOUNT
BERS, EXCEPT ©DD-XOT DEALERS AND
Total

90.9

—

recreation

1

Production

3.27
397.3

"

317,710

918,562

—

sales

Other

116.9

—_____-—

.

sales

Short

116.5

105.3

MONEY IN CIRCULATION—TREASURY DEPT

MEMBERS (SHARES):

Round-lot sales-

Total

97.7

116.0
'

—

AGRICULTURE—Estimates

COTTON

ON THE N. Y. STOCK
ROUND-LOT STOCK TRANSACTIONS

ACCOUNT OF

FOR

Nov.

Banks

6

106.4

>

3.75

3.05
405.0

411.6

$47,336,781

-Nov.

106.4

3.51

3.11

259,692

—

103.7

——

—

and services

goods

To

3.40

3.21

—

104.3

*>.*

COTTON felNNING (DEPT. OF COMMERCE)—

3 23

3.14

3.05

'

108.1

117.3

3.12

106.48

■

124.6

105.4

—

and

108.16

2.54

^3.13"'

.

94

'

121.9

117.4

care

106.21

112.19

433,268

'

122.4

—:—__.

109.06

>

•

MOODY'S

-

——

care

111.25

'

247,513

>

106.9

girls'

apparel

100.00

—

—

boys'

Transportation

ROUND-LOT STOCK BALES

TOTAL

and

105.86

258,396

-

107.8

,

105.00

,\r2.55
~
s

409.8

6

107.9

;

Member

\

purchases by dealers—
Number of shares

operation

110.70

3.10

6

126.0

i—_r.

3.45"

*ov.

,

128.6

■_

3.13

iNfOV.

'r

■>

118.4

128.8

:

Other

3.02

6

116.7

119.2

—

107.98

6

.iNov.

106.6

119.6

106.0

and fuel oil

Housefurnishings

112.37

112.19

2.88

>.

114.7

116.0

——

Footwear

111.07

342

6

109.6

110.5

,

electricity

Solid fuels

31'

dealers—

sales

and

MIDLAND

-Nov.

105.1

—

110.88

-Nov.

L

113.5

105.8

„

2.55

6

107.6

-i——-

home

115.63

112.19

"

120.3

106.7

——_——

at

Women's., and

108.88

109.24

113.5

122.3

^

vegetables

106.04

111.25

113.8

113.3

119.5

and
foods

99.48

f

,

122.6

and

105.00

'

105.00

,

111.6

115.2

113.9

112.4

110.52

112.75

115.0:

114.7

-—

110.88

6

_

-

$535,000

—

—

—

Rent

1

■

$803,000

...

Housing

'

Other

home

112.37

/

115.43

——■*——

Round-lot sales by

at

99.25
,

-Nov.

—

Customers' other sales—

/.

$762,000

YORK—

September:

110.70
115.24

99.31
110.83

_Nov.

Number of

"v

NEW

1947-49=100

—

94.89

.-Nov.

shares—Total sales
Customers' short sales:

INDEX

of

Apparel

—

(customers' sales)—

purchases by dealers

Odd-lot
'.

OF

omitted)

bakery products
Meats, poultry and fish
Dairy products

'

-NOV.

Number of shares
Dollar value

*

$37,076,000

OUTSTANDING—FED¬

BANK

(000's

31

Cereals

NEW

SECURITIES EXCHANGE COMMISSION:
dealers (customers'purchases)!

Odd-lot sales by

*

'*

3,848,000

$36,381,000

items

Food

J. 8T0CK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDJ LOT DEALERS AND SPECIALISTS ON N. Y. STOCK
~

4,366,000

_____

31.700c

Nov. 19

AVERAGE =±» 100

1949

All

29.575c

Nov. 13
Nov. 13
Nov. 13
.Nov. 13

Orders received
>

9,671,000

5,584,000
2,290,000

$29,000,000

———_

PAPER

Oct.

CONSUMER PRICE

$35.33

29.700c

(ov.23
Nov. 23
(ov. 23

——

;

Group:

Industrials

MOODY'S

.

11,879,000

1,952,000

-

RESERVE

of

$5ti.o9

$33.00

29.700c

(ov. 23

—

—

Utilities

Public
■"
-

-

__

1

.

$56.59

$34.00

'

29.700C

Nov. 23
Nov. 23
—Nov: 23
—Nov. 23
Nov. 23
—Nov. 23

—

;

A

ERAL

As

4.632c

4.798c

$56.59

i.

V $33.83

I

*

*

r

Baa

L~

4,235,000

4,733,000

Pood

$56.59

.

—Nov. 23

Bonds

corporate—

Aa
t

4,797c

4.798c

Nov. 23

—

1

1

Group

U. S. Government

'

223

Nov. 23
—Nov. 23
Nov, 23

—

Average

,

229

Nov. 23
Nov. 23

:

MOODY'S BOND YIELD DAILY

'

227

_Nov. 17
(ov. 17
Nov. 17

—i—

_____

Group

Industrials

I

208

'

;

(ov. 17

„_—

_

___,

Utilities Group

Public

,

8,416,000

Nov. 17
(ov. 17

____.

—

______

Railroad
;

9,033,000

liabilities

840

$14,956,000

5,366,000

11,845,000

—!

819

$11,262,000

2,923.000

liabilities

Other

.___

___

Baa

•

89

;75

'

$7,547,000

—

service liabilities

COMMERCIAL

_IIIII—I~-III—II—III—II"———IIII—-Nov. 23

Aa

59

871

Fruits

corporate

Average

:

9,317,000

9,197,000

Total

113

*

U. 8. Government Bonds

'

84
404

88

68

number

113
406

109

liabilltes

liabilities

Month

%, MOODY'S BOND PRICES DAILY AVERAGES:
*

188

91

liabilities

Commercial

V

QUOTATIONS):

;—
at

Louis)

(East St,

Zinc

119

>ov. 16

at-

(St. Louis)

Lead

'

153

189

414

615,00C

*127

Nov. 16

-

York)

(New

" Lead (New York)

,

~
_

„

Manufacturing

8,829,000

561,000

130

Nov. 13

:

Domestic refinery at
Export refinery at

"

8,290,000

521,000

(ov. 16

& M. J.

(E.

Electrolytic copper—

....

*8,510.000

;

,

.

;

(per gross

'METAL PRICES

.

"v

&,

—

ton)—
Scrap steel (per gross ton)
Pig iron

DUN

—

;.___

Finished steel (per. lb.)

.

_

"

624,000

8,720,000

Nov. 20

—„_

IRON AGE COMPOSITE PRICES:

.*

BRADSTREET,

number

$323,236,000

161,329,000

Nov. 13

__:

BRADSTREET, INC
'

&

October:

of

service

$371,482,000

Nov. 13
Nov. 13

*

—

kwn.).

000

(COMMERCIAL

FAILURES

(

$516,722,000

ELECTRIC INSTITUTE:

EDISON

.

626,31',

INDEX—FEDERAL RESERVE

AVERAGE =100

SYSTEM—1947-49

,

.

—

ttons)

SALES

STORE

DEPARTMENT

$608,746,000

number

Commercial

OF MINES):

Pennsylvania anthracite (tons)
'

Construction

18
(ov. 18
<ov. 18

—-

.

S. BUREAU

(U.

34,103,000

$687,252,000

number

182,534,000

—__—2—■s—t—— Tov.

—

55,708,000

47,712,000

'

number

number

Retail

Total

„_

COAL OUTPUT

-

INC.—Month

Manufacturnig

$301,779,000

2

Federal

85,239,000

55,317,000

shipped between

—

-'ov. 18

-Nov. 18

——_—i

—

State and municipal

-

144,720,000
10,052,000
45,477,000

ENGINEERING

—

;

construction

Private

118,677,000

—:

BUSINESS FAILURES—DUN

V

NEWS-RECORD:
'

*

J

<

,

•v

Nov. 13
received from connections (no. of cars)— .ov. 13

freight

Revenue

192,959,000

'

*—

—

—

134,532,000

12

oil
oil

cars)

11,273,000

71,829,000

credits

on goods stored and
foreign countries

36,236,000

136,159,000

fuel

OF

$226,662,000

138,803,000

11,575,000

142,836,00c

150,676,000

149,138,000

147,896,000

12

fuel

''"Revenue freight loaded (number of

<

exchange

$207,042,000

148,286,000

-—_—

1

Based

Total

(ov.12

_

ov.

ASSOCIATION

31:

$207,286,000
——

Wholesale

1

Ago

BANK

October

of

Year

Month

8.258,000

transit, in pipe lines—
;6v.
(bbls:)* at

Residual
•

As

—

warehouse

9,955,000

.ov.12

RESERVE

shipments

Dollar

23,945,000

2,197,000

11,409,000

Distillate

;

YORK

Domestic

6,951,000

(ov. 12

:

of that date:

Previous

OUT¬

—

Domestic

6,219,250

Nov. 12

;

output

and unfinished

Finished

6,191,350

^ov. 12

(bbls.)
(bbls.)

Stocks at refineries, bulk terminals, in

e

6,220,150

(ov. 12

;

oil

fuel

ACCEPTANCES

Exports

(bbls.)
Residual, fuel oil output (bbls.)___—

Distillate

NEW

OF

1,956,000

(bbls. of

gallons each)

Gasoline

DOLLAR

Imports

output—dally average

condensate

and

Crude runs to stills—daily average

;

BANKERS'

86.8

1,776,000

*1,892,000

§1,890,000

Nov. 28

are as

Month

Ago

74.5

either for the

are

Latest

PETROLEUM INSTITUTE:

AMERICAN

of quotations,

cases

STANDING—FEDERAL

Equivalent to—
Steel ingots and castings (net tons)

"

in

or,

Year

Ago'.
*79.3

§79.3

Nov. 28

(percent of capacity)

that date,

on

production and other figures for the

cover

Dates shown in first column

month available.

Month

W"»k

INSTITUTE;

STEEL

AND

Indicated steel operations

or

month ended

or

Previous

Latest

39

(2175)

—

issuable

2,745,433

6,695,385

2,124,988

The Commercial and Financial
40

Chronicle

..Thursday, November 25,1954

.

(2176)

nations, are
«o longer tolerable.
The "under¬
developed" countries want to be

facilities, as between

should

und

be

something more
materials for

than sources of raw

the

"developed" countries.

economic goal
has been the
creation
of the widest
possible
area of
non-discriminatory trade
relationships and the widest pos¬
sible return to freely convertible
currencies.. There has been con¬
siderable progress.
But I would
hope that the pace of progress
-could now be accelerated.
Even
without trying to read too much
The

underlying

of all of this effort

long-term significance into shortterm movements, there have been

of the

signs

encouraging

intervention.

government

much

competition, than at any The re are undoubtedly some
time since the end of World War things which our government can
II.
And this testing of the eco¬ and should do to promote private
nomic
strength of our trading foreign investment. Perhaps the
tax laws relating to such invest¬
partners, prior to formal and final
ment can be improved and per¬
steps of whatever character and
haps some guarantees against spe¬
degree into the supposedly chill
cial risks can be provided. But by
waters of non - discriminatory
and large, private foreign invest¬
trade and currency convertibility,
ment should be a matter of private
reduces
the
risks of the final
risks and private rewards, with
plunge and makes it that much
fair and
equitable treatment at
more likely that the final plunge
home and abroad the fundamental
will eventually be taken.
prerequisite.
It is Important to emphasize
Psychologically, what happens
this demonstration of the ability in the field of foreign investment
of trade and payments liberaliza¬ has a lesser
impact than what
tion to go forward more or less happens
in the field of foreign
hand in hand.
We have always trade, because the former is less
of

devel-

-opment of the kind of a trading
world we have sought to achieve.
And recent

lems.

twenties,

Opportunities for a Liberal
Foreign Trade Policy

Mew

frozen since the torrid
is beginning to thaw a
little.
There is a trickle, and it
should continue and grow, if the
world climate gets warmer, but I
would doubt that it will quickly
become a torrent.
And I would
not want to see it forced by too
largely

16

Continued jrom page

international political

free

non-discriminatory trade
convertibility in

coupled
with

currency

public eye, because nobody
to be hurt directly by its

in the
seems

prescription for international absence, and because in our think¬
We have held, ing it is often considered to be a
rightly I think, that currency con¬ balancing factor after the trade

our

economic health.

with
continued and returns are in.
Not nearly so much heat is gen¬
widespread discrimination against
given us a new frame of reference.
dollar imports would be a largely^ erated by the failure of figures of
k
Perhaps, first on the list of en- sterile accomplishment, not only foreign investment to come up to
'coiiraging signs is the fact that for us but for those who might hopes or expectations, as is gen¬
economic
readjustment in this
attempt to pursue two such mis¬ erated by trade decisions such as,
country, which began last year, matched policies. A phony equi¬ for example, an increase in the
has not degenerated into
a de¬
on
dried
figs
or
Swiss
librium, involving formal convert¬ tariff
pression and has not had the ser¬ ibility but achieved or maintained watches or the failure to award a
ious effects on our international
by quantitati ve controls, would be generator contract to a low bidder
trade and on economic conditions
from abroad. The latter incidents
only a little more enduring than
are
commented on all over the
abroad, which many feared and the
present equilibrium of quan¬
many expected.
For too long we titative controls plus exchange trading world and interpreted as
another sign of a return to stricter
were
considered to be a race of controls.
economic
barbarians,
given to
protectionism in this country.
While
there
are
encouraging
No retaliatory moves are threat¬
wild and wide swings in economic
signs and portents, however, we ened because we don't export
activity which, because of our
can by no means conclude that all
more capital, even
though this is
weight, and height and reach,
of
the
conditions precedent to
one of the factors behind discrim¬
endangered every other trading
freer trade
and payments have
ination against dollar imports.
nation.
The
recession
in this
been established.
Thus far many
And no domestic groups or in¬
country which began in the sum¬
countries, including our own, have dividuals identify themselves
mer of 1953 has been a moderate
made their contributions, each one
loudly and effectively as being
-one, and already it seems to have
largely in its own interest, but hurt by the failure of private
lost its force rather than feeding
nevertheless contributing to the funds to seek
foreign investment
on
itself.
We may now |be re¬
general forward movement. Yet I opportunities. Apparently we can
garded as a civilized economy.
think there is some feeling among
afford to get along with a gradual
those of you who are interested in
Growing Economic Strength
growth of private foreign invest¬
foreign trade and committed to a
Abroad
ment, if progress is being made
more
liberal
foreign
economic on the more explosive front of
Related
to
but
also separate
policy that, after a magnificent trade relations.
:from this heartening display of
developments seem to me to have

vertibility

.

part, has been
the growing economic strength of
many
foreign countries.
In the
United
Kingdom
and
Western
Europe, in particular, economic
stability

on

our

start, we are now inclined
less than our share.

were

this

recession, the

in

years.

many

Production has in¬

creased, internal fiscal and mone\hry conditions have improved,
controls including some controls
on dollar expenditures have been

to

Investing

Abroad

-seme

a

of the United States, ; and
decline in our imports, with

resultant increase in our surplus

exports,

Questions

raised;

are

on

two

relative reluc¬
abroad, and our

.shewn

the

and

gold

a

mid-1953

and because I believe the

has

a

problem

lesser psychological impact

than the problem of

dollar policy.

substantial gain — from
to
mid-1954 approxi¬

mately $2.3 billion or

10%. To be

Foreign

it

ized

study

of

no

get

great

this

program"

"giveaway

—

are

foreign trade

The false assumption

is that we

trying to recreate a past situa¬
tion in which a good "creditor
are

political relations,
light of recent national
successes in dealing with domestic
economic readjustment, the im¬
pediments to a more liberal and a
more
stable foreign trade policy
and in the

than to

should look

elected

which

ly, of local issues rather than na¬
tional or international issues, con¬
Yet

all

we

are

City Southern
3%% Bonds Sold

that

aware

"giveaway" policy is no longer
acceptable
either to
those who give or to those who

the

generally
receive.
If

and
not

The

to move ahead,

are

we

must

be

now

new

devised

adopted. If we cannot or will
adopt
policies which may

temporarily hurt the few but are
the benefit of the many, had
we not better give more attention

Dec.

many

countries,

while

tional

commodity

markets were neighbor to the north, the com¬
in the United petition of domestic plus Canadian

reopened

free¬

this distinction is shared with our

become

•been less

competitive, has
shielded from the tests

more




series

:
bonds

C

tion

prices ranging from

to

par,

at

prices receding from

will

case.

102%

to

V:;-;./-..v-^

.;

Net

liberal foreign trade pol¬

105 V8%

and for the sinking fund

plus accrued interest in each

par,

proceeds from the financ¬

ing, together with other funds of
the
one

a

thing I

long

am

time.

company, will be applied to
redemption of all of its out¬
standing first mortgage 30-year
4% bonds, series A, due Oct. 1„

the

products

These goals are
and

seeking

without

and its first mortgage 203%% bonds, series B, due1968, aggregating $51,043,000 in principal amount.
The company owns and oper¬

1975,

year

June 1,

they still work their magic. But
who can say how much donger,
and in a more competitive world,
the traders of other nations and
the traders of this nation will sub¬
mit to discrimination against their

relations, under both private

same

general conclusions, pointing

toward the desirability of framing

more

restrictive retaliatory action? Who

how much longer so much
of the trade of the world can be
carried on with inconvertible cur¬
say

rencies, without those trade areas
which revolve around inconverti¬
ble
currencies
tending
to
fall
And, therefore,, who can
how much longer we can ex¬

miles of main line be¬

ates 788.91

tween Kansas

Arthur,
the

is

operates

and

891.47

of

total

City, Mo., and Port;

Texas,

miles

shortest

of

line.

a

It;

between

route

Kansas

City and the Gulf. At
Shreveport, La., it connects with
its wholly owned subsidiary, theLouisiana
&
Arkansas Ry.
Co.„
which provides

a

direct route to

La., on the souths
and to Dallas, Texas, on the west,,
and adds 752.32 miles of operated
Orleans,

New

Operating,

mileage to the system.
the

of

Kansas

City

apart?

revenues

say

Southern System are derived pri¬

pect

to

see

toward

progress

of
a< marily from the movement
freight. The ratio of freight rev¬

world of freer international trade

pretty one, but not an
impossible one in the short run.
great¬

billions of dollars, we must over¬

growth

helped to create.

come

that

our

national

I don't believe
penchant

for

"giveaway programs" extends so
as to make this our only solu¬
of international trade prob¬

do not refer here to so-called di¬

far

rect

tion

investment), which has been

and

were

reported at $44,783,486-'

consolidated

net

income

at;

LEVITTOWN, N.

Y. — Robert
Charles M. Karnes
conducting
an
investment

V. Barger and
are

offices at 20 Trap¬

business from
per

Lane under the firm

name

of

Barger and Karnes.

tient, high level attention that has

given to our international
political and military problems,
and to our domestic economic pro¬

Blaine Adds

been

In the present position of
States in the world,

gram.

United

the

intertwined, and

these

things

if

to

Staff

(Special to The Financial Chronicle)

ASHTABULA, Ohio
L.

the

Pletcher

of

staff

has

—

been

Perry

T.

Russell'

added

ta<

Blaine

&r

neglect one we imperil the

the difficulties of

investment is

of

aries

And in the short run we can

$6,921,454. For the year 1953, rail¬
policy so as to permit for¬
ly jeopardize our chances for the way operating revenues aggre¬
eign exporters reasonably com¬
long run.
gated $78,683,469 and net income
petitive access to most American
As I said in a statement which was $12,177,881.
markets.
The fire and emphasis
with which such recommendations your committee issued, in calling
have been made have diminished, this meeting:
With Investors Planning;
"Freedom to trade and freedom
perhaps, the closer the study group
(Special to The Financial Chronicle) .« ■
has been to Congressional atti¬ to spend the earnings of trade are
BOSTON, Mass. — Benjamin^
tudes, and to business and labor measures of progress in goodwill
Gerstein is now with Investors:
pressures, but whether the out¬ and integrity. If we and the other
come has been a ringing affirma¬
nations of the world reject this Planning
Corporation ;'<■ of
New
tion of liberal trade policies, or an approach, we may well be setting England, Inc., 68 Devonshire St.,
attempt to devise a program which a course toward insularity in trade
would seem to have a chance of and
toward
inconvertibility
of
Barger & Karnes Opens
adoption, practically all of these currencies which it will be most

trade

projecting
a trade policy which will help to
sustain what we have so greatly

going to inhibit the
"foreign" investment.
rencies was being permitted There are signs that the market
abroad. International trading has for private foreign investment (I
cur¬

day.

same

new

be redeemable at regular redemp¬

still believed to be attainable

is

Kingdom, and while greater
dom of dealing in various

the

The

pretty sure.
We cannot afford to go back and
we
cannot .afford to stand still.
The twin goals of currency con¬
vertibility and non-discriminatory
trade relations have been before
the various trading communities
Of

trade

and

1, 1984, at 101.93%, to yield
Subscription books were

closed

icy?

can

and

Inc.

3.15%.

suggestions
which would require the whole
economy, and the whole nation,
to help bear the economic pres¬
sures which might
be placed on
some localities, on some industries,
on some groups of individuals by

for

Corp.

Co.

&

Nov. 19

on

30-year 3%% bonds, series C, due

than has been given to

more

Boston

publicly of¬
fered $50,000,000 of Kansas City
Southern Ry. Co. first mortgage

for

a

First

Halsey, .Stuart
associates

measures

lieve,

fceing

should follow.

Kansas

this seeming illogical

to

tributes
result.

taken place.

interna¬

we

and re-elected on the basis, large¬

litical stability around the world now the need is to push forward
highly significant, I be¬ is more precarious. We have been with greater purpose. Now that
that this record has been described, and not wholly inaccu¬ we have pretty well accomplished
made while discriminatory trade
rately, as the greatest "underde¬ the task of aiding in the recon¬
restrictions aimed against dollar
veloped" country in the world. So struction of the trading world, by
imports were being relaxed in long as this is so, and so long as governmental gifts and loans of

ft

than

formidable

less

they have in the past. The way is
open to you to lead us in the path

United States payments for country" is a heavy exporter of
.services and remittances, for mil¬ capital to redress its balance of
payments. This was a part of the
itary» expenditures abroad,
and
combination
of
factors
which
3for economic aid, contributed to
made the mechanism of interna¬
4his result. But without the gen¬
tional trade and payments work
eral improvement in international
comparatively well
during the
economic conditions, and the
studies have pointed in the same difficult to alter for many years
19th
century when the United
direction.
to come."
greatly reduced dependence of
Kingdom was the hub of world
the rest of the world on supplies
The net result so far has been
We cannot let this happen.
It
commerce and finance. It has less
from the United States over the
including, more is time to tackle our problems of
meaning and less force now when some progress,
last few years, this sharp increase
international
trade and
finance
the
United
States
occupies
or recently, holding the line against
-in gold and dollar reserves could
of restrictionism, but with the same indefatigable, pa¬
shares that position, and when po¬ a revival

jsure,

eot have

trade which
with a new fer¬

international

a

beginning, hurt some particular
groups of our citizens.
And the
fact that with few exceptions, our
legislators

the

itself to

address

In the light of recent historic
accomplishments in the field of

adopt policies of trade liberaliza¬
tion which might, at least in the

national

will

has before it,

vor.

on

of

all of us—as it is in the case

?

problems of foreign

warm¬

placed

in which the burden is

a

financial

hope, therefore, that your con¬

vention

hearted nation to adopt a program

Trade

foreign

to

easier

lack of organ¬

our

I

of

stepchild
policy.

than

more

There must be some deeper
force at work. I suspect that it is

end of World War II

been

thing

and and
payments if these goals con¬ enue to gross revenue has been*
to invest
government sponsorship. The Bell tinue to elude us? The alternative
approximately 90% foir each of
halting approach to a more liberal report, the Paley report, the re¬
of a United States which might be
the last five years.
foreign trade policy. The lesser port of the Randall Commission,
For
the
eight months ended'
trying to rebuild barriers to im¬
problem of the two, in my opinion, and many others, have all gone
ports, and of other principal trad¬ Aug. 31, 1954, consolidated rail¬
is foreign investment.
I say the over the ground, have all studied
ing nations of the world trying to way operating revenues of thelesser of the two, not because I much the same facts and figures,
build a permanent non-dollar bloc,
company and its railroad subsidi¬
think it is of little importance, but and have mostly come up with the
is not a
scores—our

of foreign countries have

reserves

Since the
there has

relaxed, and a better competitive because I believe that questions
position has been attained. And relating to foreign investment are
•despite a rise of commercial ex¬ often based on a false assumption,
ports

Our

do not prefer to

away

ity?

Relations

Reluctance

Oar

has continued while we
main
first time
tance
has
happened in a great

progress

of

we

domestic

to do

Studies

Surely

to foreign countries the
of our farms and fac¬
tories and mines, rather than trade
with them on some basis of equal¬
give

products

we

others.
on

our

are

effort

It is time for a real

part to make

international

trade something more

than

a

step¬

child of domestic economic

policy,

finance

some¬

and

international

Co., 4519 Main Avenue.

With Seasongood & Mayer
(Special

to The

Financial Chronicle)

CINCINNATI, Ohio—Edgar J.,
Mack, Jr., is now with Seasongood:
&

Mayer,

Ingalls

Building.

Volume Ulft

Number 5380

..

The Commercial and Financial Chronicle

.

(2177)

Securities Now in Registration
it Admiralty Alaska Gold Mining Co.
Nov. 12 (letter of
notification) 600,000 shares of
stock

Price—At par (five cents per
share). Proceeds—
For exploration and
development expenses. Underwriter

stock

(par

cent).

one

Price—10 cents

per

com¬

share.

—

interest

series

Alaska Telephone
Corp. (12/15)
Nov. 9 (letter of
notification) $158,000

of 6% 10-year
convertible debentures, series
D, due Dec. 1, 1964. Price
-—At $70 per $100 debenture.
Proceeds—For payment of

1,

to dial system, increased facil¬

it Allied-Manchester Corp. (Mass.)
Nov. 17 (letter of
notification) 2,999 shares of
ble

class

A

stock.

common

Price

At

converti¬

warrant in

Inc., San Francisco, Calif.
notification) 2,970,000 shares of class

Co.,

(John

R.

Boland & Co.,

exchange for each share

(Blyth & Co.,

of no

Tennessee

Mexican Gulf Sulphur Co
(Van

Common

275,000

Common

(Scherck,

Century

Interstate

(Bids

Paraderm

(Sheehan

&

Co.)

Loeb,

Rhoades

11

a.m.

EST)

(Bids

EST)

invited)

(Tellier

&

Co.)

Oct.

(Tuesday)

%

(Blair

&

Incorporated)

(Bids

11

EST)

a.m.

(Bids

noon

Common

EST)

December 15

Common

Barney

&

Co.)

American Discount Co.

(Tellier

(A.

$30,000,000

a.

•
.

U.

i

(Exchange after—bids 11

S. National Bank of Portland
(Blyth &

Co.,

Inc.)

December 6

.

Illinois
;

;

$158,000

pf Georgia.

new

common

stock

(par $]>

common stockholders
share for each four shares held as of

repay

Co.)

&

and

derwriter—Blair

.Common
Dillon

&

Co.)

stock.

246,119. shares

.

—.Common

(Peter Morgan & Co. ) $1,250,000

..

—For

f

RR.„____..i_——^-Debentures

(Bids to be invited) $18,000,000

...

&

Co.

(Ore.)__Common

Olsen

New

York.

"

•.

..

V„ .'

.

Salt

Price—At par (three cents per share). Proceed*
expenses. Office—510 Newhouse Building,.

mining

Lake City, Utah.
Underwriter
Phillips Building, same city,

;

(C. A.) Manufacturing Co..;

Call-Smoot

—

C«l»
i

Continued

,

$2,400,000

Incorporated,

Big Bend Uranium Co., Salt Lake City, Utah
Aug. 6 (letter of notification) 7,000,000 shares of comment

$30,000,000

Loma Uranium Corp.

44,476 shares

if Bell & Gossett Co., Morton Grove, III. (12/14)
23 filed 300,000 shares of common stock
(par $2)_
Price—To be supplied by amendment. Proceeds—To re¬
tire long-term indebtedness to insurance
companies and
Nov.

for general corporate purposes.
Business—Manufactures
and sells vorious types of heat transfer
equipment. Un¬

Preferred

Lane, Space & Co.;
Corp.) $7 50,000

*

(12/15)

Nov. 24 filed 246,119 shares of common stock
(par $1).
Price—To be supplied by amendment.
Proceeds—To

Bonds

Stanley

Eastman,

Central

;

Preferred
EST)

a.m.

599,215 shares of

Equity Corp., the selling stockholder.
Underwriter—
Probably Eastman, Dillon & Co., New York.

Common

Corp.

(Probably

Common

$299,200

Mississippi Power & Light Co
■

~

$6,000,000

(Kingdom of)
(Morgan

(Thursday)
Searight)

one

tK Bell Aircraft Corp.

•

Bonds

Debentures

& Co.; Johnson,
Interstate Securities

shares

Pfd. &

-^

loan made to subsidiary; a
major portion for
completion of seamless tube mill being constructed; and.
for general corporate purposes.
Underwriter—Lee Higginson Corp., New York.

(Wednesday)
Co.)

&

Law

Bell Aircraft

December
Atlas Credit Corp
(George

M.

Belgium

Penner & Beane and

100,000

filed

Corp., New York

Nov. 4 (with an
oversubscription privilege); rights to
expire Nov. 26. Price—$4 per share. Proceeds—To

Debentures

Alaska Telephone Corp

$15,000,000

Merrill Lynch, Pierce,

Smith,

Steel

being offered for subscription by

300,000 shares

New Orleans Public Service Inc

Pennsylvania Co. for Banking and Trusts_Common
(Drexel & Co.;

12

at rate of

^

Common

._.

Co.

Bonds
EST)

a.m.

i;

cyy-y-

New England Tele. & Tele. Co

(Goldman, Sachs & Co.) 200,000 shares

11

—

••

$2,250,000

Bell & Gossett Co

$300,000

Laclede Gas Co
(Bids

Bank

—

(Scott, Horner & Mason, Inc.) $533,750

Mines, Inc

oversubscription privilege);
Price—$5 per share.
Proceeds

an

option to purchase certain oil and gas

an

short-term

Bonds

Federal Paper Board Co., Inc

(par $1)
stockholders

share for each

Building & Equip. Corp. of America (11/30)
(letter of notification) 22,800 shares of common
stock (par $2).
Price — $13 per share. Proceeds
To
three selling stockholders.
Office—906 Sidney
St., St
Louis, Mo.
Underwriter
Scherck, Richter Co., same
city.
v''..v.-

...Debentures

$5,010,000

Co.)

•

(Monday)

&

new

Nov. 12

Common
Simonds

(with

Dec. 1.

on

one

and undeveloped leases from the
Southern
Co., retire bank loans and to increase work¬
ing capital. Underwriter—None.

$4,575,000

December 14

(Wednesday)

Blue Mountain Uranium

shares held
exercise

stock

common

Union Gas

Equip. Trust Ctfs.
be

at the rate of

production

Co.;

V

Virginia Telephone & Telegraph Co
December 1

—To

(Van Alstyne, Noel & Co.) $2,000,000

Equip. Trust Ctfs.

noon

seven

$7,250,000

$12,000,000

Seaboard Air Line R. R

being offered for subscription by

Bonds

EST)

a.m.

to

shares

Public Service Co. of New
Hampshire
(Bids

11

Aztec Oil & Gas
Co., Dallas, Texas
Oct. 13 filed 285,005 shares of common

rights expire

$1,350,000

Servomechanisms, Inc.

Common

310,285

...Common

on

page

(Hornblower & Weeks) 225,000 shares

(Monday)
January 4

Chicago, Milw., St. Paul & Pac. RR._

(Tuesday)

"

Union Trust Co. of Maryland

Equip. Trust Ctfs.
(Bids

CST)

noon

(Alex.

$7,200,000

El Paso Natural Gas Co

Preferred

Brown

&

Sons)

January 11

(White, Weld & Co.) 300,000 shares

.

.Common

100,000

shares

(Tuesday)

Commonwealth Edison Co.—
December
Central

Power

&

(Bids

Illinois

(Tuesday)

to

be

Island

invited)

11

$7,500,000

& Co.)

(Eids to

December 8

New

Bonds

EST)

England
—■

•

$15,000,000

Bonds

invited)

be

invited)

Debentures

$36,000,000

w

Power

(Bids

&




Co.)

:

Bonus
$25,000,000

be

to

(Tuesday)

Co

Bonds

invited)

'

New York

$25,000,000
V'

■

;' February
Kansas

15

Philadelphia

(Tuesday)

City Power & Light Co

•(Bids to

be

invited)

$16,000,000

Boston

Pittsburgh

Chicago

■

'

(Wednesday)

(Commonwealth of)
(Morgan Stanley

be

January 18

$1,000,000

Co

a.m.

>• I

Australia

to

York, Chicago & St. Louis RR

Preferred

Witter

Lighting
(Bids

(Bids

New

Preferred

Telephone Co
(Dean

Long

7

Light Co

r

£>•

>

Telebet units and Teleac
systems and additions to work—

as

Bonds

Associates

(Beker,

$10,000,000

Co.)

/

.

Automatic

(Thursday)

$250,000

&

Underwriter—None.

Remote Systems, Inc., Baltimore
Aug. ,4 filed 620,000 shares of common stock
(par 64(
cents), of which 540,000 shares are to be offered to«
public and 80,000 shares to be issued to underwriter.
Price—$3.75 per share. Proceeds—For manufacture

Co.) $2,625,000

Jarecki Corp.

Philippine Long Distance Telephone Co.^_Common
M.

Price—$4 per unit.
Proceeds—For ex¬
development costs.
Office—206 N. Vir¬

Underwriter—Morgan Stanley & Co., New York.

Barium

Preferred
CST)

a.m.

Laboratories, Inc..—

(Carl

Utilities

shares

Co

10:30

&

Co

invited)

December 13

Common

Power

be

December 9

Anthony Securities Corp.) $300,000

160,000

•'

Together with other funds, to redeem on Jan.
15, 1955,
$29,631,000 of External Loan of 1925 30-year 5%
gold
bonds due July 15, 1955 at
100% and accrued interest.

Equip. Trust Ctfs.
to

Common

(Reynolds & Co.)

-Wrcommon

(Commonwealth of)
(12/8)
Nov. 18 filed
$25,000,000 of 15-year bonds due Dec. 1,
1969. Price—To be
supplied by amendment. Proceeds-

Common
Crerle

Missouri Pacific RR

$296,400

Inc.

17.

^Australia

shares

Securities Corp.; White, Weld &
Halsey, Stuart & Co. Inc.) $125,000,000

(Bids

Consolidated Television & Radio Broad¬

casters,

and

ginia St., Reno, Nev.

of record Oct. 29

Webster

**1

Common

Corp

300,000

Otis, Inc. and

(Bids

Uranium
(James

Richter Co.)

&

$500,000

Eastern

November 30 (Tuesday)
Building & Equipment Corp

&

(Bids

Preferred
Wells & Co.)

Brothers)

Texas Pacific Ry

Alstyne, Noel & Co.) 200,000 shares

(Watling, Lerehen & Co. and Mullaney,

unit

per

—

•

Gas Transmission

and

Pioneer Finance Co

Bank

(Stone

shares

-

of stock.

ploration

purchase
value $6

par

Stancan Uranium Corp

,

(Gearhart

Inc.)

Price—$4

Office
2411
No;
Philadelphia 32, Pa. Underwriter—George A.

(par 25 cents) and 3,300 shares of preferred stock
(par 75 cents) to be offered in units of one share of each,

class

Common

(Lehman

(Monday)

Arrowhead & Puritas Waters, Inc

(par

,

Common
'

20-cent

(par $2.50) arid
10 cents) in units

• Atriminas, Inc., Reno, Nev.Nov. 19 (letter of
notification) 3,300 shares of

Chicago

Monterey Oil Co

Inc.) $295,295

stock

Searight, New York. Offering—Effective Nov.

CALENDAR

(Friday)

November 29

common

ing capital. Underwriter—Mitchell
Securities, Inc., Bal¬
timore, Md.
r

ISSUE

Reinforced Plastics Corp.__Debentures &

(12/2)

—

Broad St.,

-

November 26

Corp., Philadelphia, Pa.

stock

Co.,

NEW

Trust;

—

share of each class of stock.
For further expansion.

one

Proceeds

Arrowhead & Puritas
Waters, Inc. (11/29)
Nov. 8 filed 275,000 shares of
capital stock (par $1), of
which 50,000 shares are to be
issued by the company
and 225,000 shares on behalf
of American Trust

American Uranium, Inc.,
Moab, Utah :
Aug. 18 (letter of notification) 3,320,000 shares of
capita]

Atlas Credit

of
A

new debentures.
Warrants would be ex¬
ercisable at $12.50 per share
during the first two years,
$15 during the next three
years, $17.50 during the fol¬
lowing two years and $20 during the last three
years.
Financial Advisor—Wertheim &
Co., New York.

American Mutual Fund,
Inc., Los Angeles, Calif.
Nov. 22 filed 100,000 shares of
capital stock (par $1).
Price—At market.
Proceeds—For investment.

capital.

74,800 shares of

$60,000,000 of

Underwriter—

and

1
(letter of notification) 74,800 shares of
cumulative convertible preferred stock

cumulative convertible
preferred share outstanding with
dividend arrearages of $18
per share.
This will involve

(par three cents). Price—10 cents per share.
Proceeds—For exploration and development costs. Office

Bldg., Salt Lake City, Utah.
Ned J. Bowman
Co., the same city.

•

Nov. 8 filed 500,000 shares of
common stock
(par $5) to
be issued upon the exercise
of warrants to be issued in
connection with
proposed plan to issue $120
principal
amount of 5% cumulative
income subordinated deben¬
tures due Nov.
1, 1984, and one common stock

par

stock

—218 Atlas

&

Plan

—

bottled

Nov.

Angeles, Inc., Los Angeles, Calif.

Armour

Amalgamated Uranium Corp., Salt Lake City, Utah
Sept. 1 (letter of notification) 2,500,000 shares of com¬
mon

rate of 4Y2%

$2,502,111.10, to yield 5%.

Price—At par (10 cents per
share). Pro¬
ceeds—For exploration and
development expenses. Of¬
fice—995 Market St.) San
Francisco, Calif. Underwriter
—Coombs & Co., of Los

($100 per
share). Proceeds—For loans and working capital. Un¬
derwriter—Allied Research & Service
Corp., 50 Congress
St., Boston, Mass.
—

ISSUE

Business
Produces, distributes and
drinking water and is engaged in related
activities.
Office—Los Angeles, Calif.
Underwriter—
Blyth & Co., Inc., San Francisco and Los
Angeles, Calif,
and New
York, N. Y.

sells

capital stock.

i• i-^uv.v./,f:;v,'v-o;

Proceeds

working

Anticline Uranium,

Office—Alaska Trade
Bldg.,
Underwriter—Tellier & Co., Jersey

Wash.

at

E

Oct. 28 (letter of

ities, and working capital.
Seattle

REVISED

Together with other funds, to retire
unsecured term loan and subordinated term
loan and for

filed

per annum, compounded; and
Proceeds—For de¬
velopment and expansion of agricultural, industrial and
commercial enterprises in Israel.
Underwriter—None.

Underwriter—None.

•

City, N. J.

17

$5,000,000 of 10-year 5% sinking fund
debentures, series C, due 1964; $3,125,000 of 5-year dis¬
count debentures, series D; and
$4,100,000 of 10-year dis¬
count debentures, series E.
Price—Series C, at par; se¬
ries D
$2,507,659.53, to yield return equal to compound

—

indebtedness, conversion

ITEMS

supplied by amend¬

ment.

Ampal-American Israel Corp., New York

For mining expenses.
Offices
400
Boyd
Bldg., Cheyenne, Wyo., and 1154 Bannock St.,
Denver,

Colo.

PREVIOUS

trustee of Employees' Incentive Bonus
of Rheem
Mfg. Co. Price—To be

—Ogden Uranium Brokerage Co., Ogden, Utah.
Sept.

it Ajax Uranium Corp.,
Cheyenne, Wyo.
Nov. 17 (letter of
notification) 2,740,000 shares of
Proceeds

ADDITIONS

SINCE
•

stock.
common

(par $1).

Price—At market (estimated at 50 cents
per share).
Proceeds—For mining expenses. Address—
Box 529,
Juneau, Alaska. Underwriter—None.

mon

* INDICATES

41

Bonds

San Francisco

Private Wires to all

offices

Cleveland

42

•

42

The Commercial and Financial Chronicle

(2178)

Continued

from

page

Colorado

New York.

share). Proceeds—For work¬
ing capital, inventories, machinery and equipment, etc.
Office—109 N. Larchmont Blvd., Los Angeles 4, Calif.

York.

Col-U-Mex

15

(letter of notification)

1,000,000 shares of com¬

stock. Price—25 cents per

share. Proceeds—For ex¬

320

Oct. 29 filed 30,928 shares of 5%
common

Wis.

Consolidated Credit
Oct.

by amendment.

liabilities; for construction of four tuna clip¬
and the balance for working capital and general
corporate purposes. Underwriter — Barrett Herrick &

Proceeds

Corp. of America

(letter of notification) 100,000 shares of class
(par 10 cents). Price—$3 per share. Proceeds—
purchase equipment and machinery and for working

Under¬

Carnotite

Development Corp.
Oct. 26 (letter of notification) 16,000,000 shares of com¬
mon stock.
Price—At par (one cent per share). Proceeds
—For exploration and development expenses.
Office—
317 Main St., Grand Junction, Colo. Underwriter—West¬
Resources Corp.

Inc.
Nov.

Bldg., Seattle, Wash. Underwriters—Blanchett, Hinton & Jones, Seattle, Wash., and First Califor¬
nia Co., JjOS Angeles, Calif.
Central

Airlines, Inc., Fort Worth, Tex.
(letter of notification) 150,000 shares of common
stock (par 25
cents), to be offered for subscription by
stockholders.
Price—$1 per share. Proceeds—To pur¬
Oct. 26

chase additional aircraft and equipment, setting up new
stations, etc. Office—Meacham Field, Fort Worth, Tex.

Underwriter—None.

(par $100).

Proceeds—To repay bank loans and for new construc¬
tion.
Underwriter—To be determined by competitive
Boston

Corp.; Leh¬
man Brothers and
Glore, Forgan & Co. (jointly); Kid¬
der, Peabody & Co. and Blyth & Co., Inc. (jointly);
Stone & Webster Securities
Corp.; Salomon Bros. &
Hutzler; Kuhn, Loeb & Co. Bids—Expected to be re¬
Dec.

7.

•

Century Uranium Corp., Dallas, Tex. (11/30)
Nov. 3 (letter of notification) 300,000 shares of common
stock (par five cents).
Price—$1 per share. Proceeds—
For

exploration

and

development

expenses.

Office

—

712 Gulf States Bldg., Dallas Tex.
Underwriter—James
Anthony Securities Corp., New York.

date

new

set.

Television

r

--.

Chesapeake Industries, Inc.
Oct. 15 filed 996,304 shares of common stock
(par $1)
and 33,818 shares of $4 cumulative
preferred stock (par
$10) being offered in exchange for preferred and com¬
&

shares of Home & Foreign Securities
Corp. and Oils

Industries, Inc.,

Intercontinental

common

shares

of

common

stock

of

Holdings, Ltd. and Intercoast Petroleum

Corp. and capital stock of Colonial Trust Co. The offer
is subject to deposit of not less than 90% of the stock
of Colonial and not less than 80%
of the stock of
the first three companies mentioned above.
Chinchilla

Oct. 21

Corp. of America, Linthicum, Md.
(letter of notification) 1,200,000 shares of com¬

stock (par Jhree cents). Price—25 cents
per share.
Proceeds—For working capital, etc.
Office—Hammonds
mon

Ferry Road, Linthicum, Md.
Co., Washington, D. C.
Clearfield
Nov.

Underwriter—Kelleher

&

Broadcasters,

Price—To be supplied by amendment.

Proceeds

Office—Indianapolis, Ind. Underwriter—

Reynolds & Co., New York.
.'A...

,

,

.

Constellation
Oct.

11

ceeds

.

Uranium Corp.,

.

.

,

.

Denver, Colo.

(letter of notification)

stock.

mon

Price—At

For

—

par

exploration

1,000,000 shares of
(one cent per share).

and

development

-

com¬

Pro¬

8

(letter of notification) 75,000 shares of common
(par 10 cents). Price—$2 per share.
Proceeds—
To purchase equipment and for
working capital. Office




ferred
a

stock, series of 1952, on a share-for-share bas^s
eash adjustment.
Price — To be supplied by
Proceeds—To redeem 1952 series preferred

it Dallas Power & Light Co.
17 (letter of notification)

Nov.

of

common

—

Dallas, Texas.
Dallas

Office—1506

program.

Gruber & Co., Inc..

and _to

Weld

&

reduce

Commerce

Street,

Underwriter—None.

Corp.
Nov. 8 (letter of notification) 3,000,000 shares of common
stock. Price—At par (10 cents). Proceeds—For explora¬
tion and development expenses.
Office—1028 National
Bank Bldg., Denver, Colo.
Underwriter—Brereton, Rice
& Co., Inc., same city.

Eula

White,
*

*

Uranium, Inc.
Oct. 18-(letter of notification) 5,000,000 shares of corrir
mon stock (par one cent).
Price—Five cents per share.
Proceeds^-For exploration and development expenses.
Office—506 First Security Bank Bldg., Salt Lake City,
Utah.
Underwriter—Utah Securities Co., same city.
*
Fallon Gas

Corp., Denver, Colo.

20^|letter of notification) 5,400,000 shares

Oct.

of

com¬

stock

(par five cents) to be offered for subscription
stockholders of Colo-Kan Fuel Corp. for a period

mon

by

of 40 ddys; then to public.

Price—5% cents per share.
Proceeds—For expenses incident to gas activities (and
possiblyhiiranium). Office—527 Ernest & Cranmer Bldg.,
Denver,--Colo.
Underwriter — First Securities Corp.,
Philadelphia, Pa.
•
r
Federal

Paper Board Co., Inc. (12/1)
Nov. lU^filed 200,000 shares of common stock

(par $5).
be supplied by amendment.
Proceeds—To
stockholders. Underwriter—Goldman, Sachs, &

Price—To

selling

Co., Ne$£ York.
29

filed

250,000 shares of 7%

tain & Co., Inc., New

-

cumulative sinking

York

Four States Uranium

Aug.

16

Corp., Grand Junction, Colo.

(letter of notification)

stock.

mon

300,000

shares

of

com¬

Price—At par

exploratory

($1 per share). Proceeds—For
development expenses.
Office — 618

and

Rood

Grand

Joe

1669 Broadway, Denver,

Avenue,
Rosenthal,

Colo.

Junction,

Directors

Underwriter
Colo.

—

Manufacturing & Supply Co.

5 filed

Nov.

199,907 shares of common stock to be sold
to customers. Price—At par ($100 per share). Proceeds
—For capital expenditures and working capital and other
general, corporate purposes.
Office — Louisville, Ky,
Underwriter—None.

*

Gatineau Uranium Mines Ltd.

(Canada)
Aug. 10. (Regulation "D") 300,000 shares of common stock.
Price—At par ($1 per share).
Proceeds—For explora¬
tion and-development costs. Office — 100 Adelaide St.

Wesir Toronto, Canada. Underwriter—McCoy & Willard,
Boston, Mass.
General

Gas

Sent/ 22 filed

Corp.

common stock (par $5)
being offered in exchange for common stock of Consol¬
idated Gas Co. of Atlanta, Ga., on the basis of 63/100ths

143,500 shares of

share of General

a

Gas for each Consolidated share.

The offer is

subject to deposit of at least 175,000 shares
of Consolidated stock out of 210,000 shares outstand¬
ing. Underwriter—None.
General Services Life Insurance Co.

$i$i>

(par'

shares

50,000

Price—$10

corporate purposes.

of

class

A

common

stock

share. Proceeds—For general
Office—Washington, D. C. Under¬
per

writers—None.
it General
Nov.
ence}

Tire

18 filed

v^itpek

Rubber

&

Co.

95,000 shares of 5V2%

(par

stock

315,^0/Shares

$i00)

of

Motor

cumulative prefer¬

be offered

to

Products

in exchange for

Corp.,

the

rate

exchange to be filed by amendment. Offer will

of

be sub¬

ject^?-acceptance thereof by holders of not less than
General

com¬

*■'

fund preferred stock. Price—At par ($2 per share). Pro¬
ceeds—For working capital. Underwriter—E. J. Foun¬

and gas

Underwriter—None.

.

v

Credit Corp., New York

common'

Lake City, Utah '
2,000,000 shares of

—

Temporarily post¬

—

Belle

it Dawn Oil Co., Inc.
Nov. 15 (letter of notification) 50,000 shares of common
stock.
Price—At par $1 per share).
Proceeds—For oil

Desert Uranium Co., Salt
Oct. 18 (letter of notification)

Offering

'

Sept. ,14 filed

Uranium & Oil

activities.

Underwriter

loans.

bank

Co., New York.

-y/.

poned.

of

567 shares

stock (no par) to be offered for subscription by minority
stockholders.
Price
$140 per share.
Proceeds — For
construction

stock

expenses.

Office—206 Mercantile Bldg., Denver, Colo. Underwriter
—Petroleum Finance Corp., Oklahoma City, Okla.*

of Motor Products common stock.

Uranium

Salt Lake City, Utah

Corp.,

Oct.$J§&,(letter of notification) 1,200,000 shares of
mon/stock.

Price—At

par

(25

com¬
cents per share). rPro-

stock Price—At par (15 cents per share). Proceeds
—For exploration and development expenses.
Office-—

ceedsMFor development and exploration, expenses.

524

fice-^j^t

mon

Atlas

Bldg., Salt Lake

Van Blerkom

&

Co.,

same

City, Utah.
city.

Underwriter—

Devil Canyon Uranium Corp., Moab, Utah
1
Nov. 8 (letter of notification) 3,000,000 shares of com-'
mon stock'(par
one cent).
Price—10 cents per share.
Proceeds—For
fice—21

Main

exploration and development costs. Of¬
St., Petersen Bldg., Maob, Utah. Under¬
Schroeder, 501 Kittredge Bldg., Den¬

writer—Melvin F.

Colo.

ver,

stock
For

(par 10

cents).

working capital.

and allied fields.

sack, N. J.

Price—$1

per

share.

Proceeds—

Business—In orthopedic appliance

Office—151 Hackensack

Ave., HackenUnderwriter—20th Century Pioneer Securi¬

ties Co., New York.
Eastern Utilities Associates

Nov.

1,

10

1979.
be

Of-

Boston Building, Salt Lake City, Utah. Underwritff^JP; G. Christopulos & Co., same city.,
it G&prfeia Continental Telephone Co., Dawson, Ga.
No v.§J-9;(letter, of

notification) 12,000 shares of 6% cu¬
Price—At par ($25 per share).
Underwriters-r-White, Weld & Co., New York; and The Rob¬
inson-Humphrey Co. and Clement A. Evans & Co., Inc.,
both
Atlanta, Ga.
;

mulative preferred stock.

Proc0eids>— For additions and improvements.

.

Direkt-Form Corp. (N. J.) *
Oct. 21 (letter of notification) 50,000 shares of common

To

stock

New York.

shares of convertible second pre¬
of 1954 (no par) to be offered in

for subscription by common stockholders. and in
part in exchange for outstanding $4.40 convertible pre¬

Funeral

Radio

&

(11/30)

filed

(12/9)

$7,250,000 collateral trust bonds due Dec.

Proceeds—To

$7,000,000 4%% bonds

Plastics, Inc.

—Clearfield, Pa. Underwriter—P. J.

series

(12/6)

Co.

Gas

300,000

stock,

ferred

.

.

mon

Natural

filed

part

Jan.

—To H. M. Bitner, Chairman of the Board and members
of his family.

—

on

Paso
5

Financial

160,000 shares of common stock (par five
Name of company changed from WFBN, Inc. on

Nov. 8.

■

—Securities

Office — 221 ^ West
Underwriter—J. C. Wheat

loan.

C.

filed

9

cents).

Oct. 27

ceived

No

Consolidated

Aug. 19 (letter of notification) 299,000 shares of common
stock., Price—At par ($1 per share). Proceeds—To ac¬
quire claims and mining equipment, erect and equip
processing plant, and for working capital. Office—Nantahala Bldg., Franklin, N. C. Underwriter — Allen E.
Beers Co., Western Savings Fund Bldg., Phila. 7, Pa.

bidding. Probable bidders: The First

El

-

war¬

Edison Co. df New

conditions.

Securities Corp., Salt Lake City, Utah.

Natural Gas Corp.,
Seattle, Wash.
(letter of notification) 23,625 shares of common
stock (par $1) to be offered for subscription by stock¬
holders on a l-for-10 basis. Price
$6 per share. Pro¬
ceeds—To repay bank loans and promissory notes. Office

and 100 ten-year

Ytork, Inc.
April 7 filed $50,000,000 of first and refunding mort¬
gage bonds, series K, due May 1, 1984. Proceeds—To be
applied towards cost of redeeming $27,982,000 New York
Steam Corp. first mortgage bonds and $25,000,000 West¬
chester Lighting Co. general mortgage bonds.
Under¬
writer—To be determined by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Morgan
Stanley
& Co.; The First Boston Corp.
Offering—Originally set
for May 11, but has been postponed because of market

Sept. 17

Cascade

notes

bank

repay

St., Charlotte, N.
Co., Richmond, Va.
Consol.

A stock

Central Power & Light Co.
(12/7)
Nov. 15 filed 75,000 shares of
preferred stock

To

—

Trade
&

Office—615 Adams St., Hoboken, N. J.
writer—Garden State Securities, same city.

sinking fund

unit (each warrant is exercisable at $10 per share.)

per

rf) Co., Inc., New York.

capital.

Corp., Charlotte, N. C.
$100,000 of 20-year 6%

(letter of notification)

rants to purchase 20 shares of common stock to be sold
in units of a $1,000 note and one warrant. Price—$1,000

to certain

Carolina

25

subordinate

pers;

ern

•

Nov.

one

shares held Nov. 22

common

working capital. Underwriter—Loewi & Co., Milwaukee,

purchase from National Marine Terminal,
Inc. of its undivided interest in 17 tuna clippers, subject

To

10

preferred share
(with an over¬
subscription privilege); rights to expire on Dec. 7. Price
—At par ($25 per share). Proceeds—For expansion and

Inc., San Diego,

be supplied

stockholders at the rate of

for each

Proceeds—For

McKafe

Underwriter

N. Mex.

Albuquerque,
city.

same

Compo Shoe Machinery Corp.
cumulative convertible
preferred stock being offered first for subscription by

Inc.

Mines,

Calif.
Sept. 29 filed $4,000,000 of 6% sinking fund debentures
due 1966 and 160,000 shares of common stock (par five
cents) to be offered in units of a $500 debenture and 20

Caramba

Bldg.,

•

(12/1)
Nov. 12 (letter of notification) 2,000,000 shares of com¬
mon
stock (par one cent).
Price—15 cents per share.
Proceeds—For exploration and development expenses.
Office—230 N. Third St., Grand Junction, Colo. Under¬
writer—1Tellier & Co., Jersey City, N. J.

Price—To

Korber

—Whitney & Co.,

Service, Inc., Moab and Provo, Utah.

shares of stock.

Price—At par (10 cents per share). Proceeds
exploration and development expenses. Office—

stock.

mon

—For

ploration and development costs. Office—402 Henderson
Bank Bldg., Elko, Nev. Underwriter—Security Uranium

California Tuna Fleet,

Uranium Corp., Albuquerque, N. Mex.
(letter of notification) 2,900,000 shares of com¬

Oct. 25

Oct.

Uranium

—

with

Underwriter—None.

Uranium Corp., Elko, Nev.

Mountain

Oct. 28 filed 3,000,000

amendment.

mon

Blue

subscription to present stockhold¬

Price—At par ($1 per

ers.

—

•

Inc., Los Angeles, Calif.
(letter of notification) 300,000 shares of common

stock to be offered for

Denver, Colo.

Underwriter—I. J. Schenin Co., New

Mining Corp.,

(letter of notification)

Colorvision,

3,000,000 shares of com¬
mon
stock (par one cent).
Price—10 cents per share.
Proceeds—For exploration and development costs.
Of¬
fice
705 First National Bank Bldg., Denver, Colo.
Blue Jay

Capper & Co., New York.

Nov. 1

(letter of notification)

15

Edgemont Mining & Uranium Corp.
shares of common stock (par one
cent). Price—25 cents pei share. Proceeds—For equip¬
ment, exploration oh purchases of additional claims or
leases.
Office
Edgemont, S. Dak.
Underwriter —

Aug. 23

Ave., Provo, Utah.
Bikini Uranium Corp.,

Thursday, November 25r 1954

.

Denver, Colo* 300,000 shares of com¬
mon stock
(par 10 cents). Price—At the market (esti¬
mated at $1 per share).
Proceeds—To certain selling
stockholders. Underwriter—L. D. Friedman & Co., Inc.,

41

Big Indian Uranium Corp., Provo,Utah
July 15 (letter of notification) 500,000 shares of commoD
stock (par 10 cents). Price—25 cents per share. Proceed!
—For mining operations. Address—Box 77, Provo, Utaa
Underwriter—Weber Investment Co., 242 N. University

Oct.

..

determined

by

be

used

principally

to

refund

outstanding. Underwriter—
competitive bidding.
Probable

now

bidders:

Halsey, Stuart & Co. Inc.; Kidder, Peabody &
White, Weld & Co.; Stone & Webster Securities

Co.;
Corp. and Estabrook & Co. (jointly); Lehman Brothers.
Bids—Expected to be received up to 11 a.m. (EST) on
Dec. 9 at 49 Federal St., Boston, Mass.

Glasscock.(C. G.) -Tidelands Oil Co.
Nov. 12 filed 215,000 shares of common stock
Price—Tcr be
repay

supplied

by

amendment.

(par $1).
Proceeds—To

bank loans, to purchase outstanding stock of C. G.

workings capital.

Office—Corpus Christi, Tex.

Under¬

writers-First California Co., San Francisco, Calif.; and
William R. Staats & Co., Los

Angeles ,Calif.

it Globe Hill Mining Co., Colorado Springs, Colo.
Nov. 18 (letter of notification) 3,003,000 shares of com¬
mon
stock (par one cent).
Price—1% cents per share.
Proceeds—For mining purposes.
Office—326 Independ¬
ence

Bldg., Colorado Springs, Colo.

Underwriter—Al. J.

Johnson,'same city.
it Great Lakes Engineering Works
16 (letter of notification) 18,500 shares of common

Nov.

stock

key

(par $10), to be offered for subscription by certain
employees.
Price—$12 per share.
Proceeds—Fo

Volume 180

Number 5380

.

i

The Commercial and Financial Chronicle

i

(2179)
general corporate

purposes.

43

Office—Foot of Great Lakes

Investment Corp. of America
For development expenses. Underwriter—Crerie
& Co.,
Aug. 30 (letter of notification) 3,799 shares of cumula¬
Houston, Tex.
Great Southwest Land & Cattle Co.,
tive preferred stock (no par) and 3,799 shares of com¬
Mayday Uranium Co., Salt Lake City, Utah
Oct. 28 filed 1,250,000 shares of class A common stock -1 mon stock (no par).. Price—For preferred, $20 per share; ;
Oct. 29 (letter of
to be offered to present and future holders of
and for common, $2 per share.
notification) 17,000,000 shares of com*
Proceeds—For working*
special
mon
stock (par one-half cent).
Price—One cent per
participating life insurance contracts issued by Great- capital. Office—3603 Broadway, San Antonio, Tex. Un¬
share.
Proceeds
For exploration and development.
derwriter—Interior Securities, Inc., San Antonio, Tex.
Southwest Life Insurance Co., and to the public genercosts. Office—Harver
Bldg., Salt Lake City, Utah.-Un-^ally. Price—At par ($1 per share. Proceeds—To lease
if Jarecki Corp., Grand Rapids, Mich. (12/13-17)
derwriter
Utah Uranium
land for operation of cattle business. Office—Phoenix,
Brokers, 2680 South 20th
Nov. 19 filed 180,000 shares of common stock (par $1).
East, Salt Lake City, Utah.
Ariz. Underwriter—None.
Price—To be supplied by amendment. Proceeds—To F.
McCluskey Wire Co., Inc., New Haven, Conn.
J. Jarecki
Gulf States Utilities Co.
(Chairman), C. F. Jarecki (President and
June 21 (letter of
General Manager) and Leora J. Walgren, each selling
notification) $95,000 of 5% debentures,
May 14 filed 160,000 shares of preferred stock (par $100).
series A, due July
1, 1962, and $95,000 of 6% debentures,-"
Proceeds
To redeem 50,000 shares of $4.50 dividend
60,000 shares.
Underwriter—Baker, Simonds & Co.,
series B, due July
1, 1970. Proceeds—To acquire'-assets
preferred stock, 60,000 shares of $4.40 dividend preferred
Detroit, Mich. •
and business of H. & T.
McCluskey & Sons, Inc.* Office
Btock, 1949 series, and 50,000 shares of $4.44 dividend ;
-Kemper Thomas Co., Cincinnati, Ohio
—527 Grand
Avenue, New Haven, Conn. Underwriter—
preferred stock at the prevailing redemption prices of Nov. 5 (letter of notification) 10,000 shares of common
Barnes, Bodell & Goodwin, Inc., New Haven, Conn.
$105, $105, and $105.75, respectively.
Underwriter—To
stock (par $10) to be offered for subscription by stock¬
be determined by competitive
bidding. Probable bid¬
Mercast Corp., N. Y.
holders first, then to public.
Price—$16.50 per share.
ders:
Stone
&
Webster
Securities
Corp.;
Lehman
Sept. 30 (letter of notification) 5,000 shares of common
Proceeds—For working capital." Office—Norwood Park,
Brothers and Equitable Securities Corp.
stock (par 10 cents).
(jointly); Kuhn,
Price—$4.75 net to sellers. Pro¬
Cincinnati, O. Underwriter—None/
Loeb & Co.; Glore, Forgan & Co. and W. C.
Langley &
ceeds—To Atlas Corp.
Office—295 Madison Ave., New
•
Co. (jointly). Bids—Had
Laclede Gas Co., St. Louis, Mo. (12/1)
tentatively been expected to be
York 17, N. Y.
Underwriter—Franklin, Mayer & Barreceived up to 11:30 a.m.
Nov. 4 filed $15,000,000 first mortgage bonds due Dec. 1,
(EDT) on June 15 at The
nett, New York City.
Hanover Bank, 70 Broadway, New
1979. Proceeds—To redeem $6,050,000 3%% first mort¬
York, N. Yiy but of¬
• Mexican Gulf
fering has been postponed.
gage bonds due Dec. 1, 1965, and $8,000,000 3%% first
Sulphur Co. (11/29-30)'
Oct. 22 filed 200,000 shares of common stock (par 100).
mortgage bonds, due April 1, 1976, and for new con¬
Gulf States Utilities Co.
Price—To be supplied by amendment.
struction, etc. Underwriter—To be determined by com¬
Proceeds—For
May 14 filed $24,000,000 of first mortgage bonds due
equipment, capital improvements and working capital.
petitive bidding.
Probable bidders: Halsey, Stuart &
June 1, 1984. Proceeds—To redeem
$10,000,000 of 3%%
Co. Inc.; The First Boston Corp.; Stone & Webster Secu¬
Underwriter—Van Alstyne, Noel & Co., New York.
first mortgage bonds due 1981 and
$10,000,000 of 3%%
rities Corp.; Lehman
Brothers; Blair & Co., Inc., and
Mi-Ame Canned Beverages Co., Hialeah, Fla.
first mortgage bonds due 1983, and for
general corpo¬
Drexel & Co. (jointly).
Bids — To be received up to
Oct. 28 (letter of notification) 260,000 shares of common
rate purposes.
Underwriter—To be determined by com¬
11 a.m. (EST) on Dec. 1 in New York.
stock. Price—At par ($1 per share). Proceeds—To pur¬
petitive bidding.
Probable bidders: Halsey, Stuart &
Lake Lauzon Mines, Ltd., Toronto, Can.
chase faw materials and new machinery, and for work¬
Co. Inc.; Lehman
Brothers; Merrill Lynch, Pierce, FenAug. 2 filed 660,000 shares of common stock (par $1,
ner & Beane and
ing capital. Underwriter — Frank D. Newman & Co., />
White, Weld & Co. (jointly); Salo¬
mon Bros. & Hutzler and Union
Canadian), of which 500,000 shares are to be offered in
Miami, Fla.
Securities Corp.; Kuhn,
behalf of the company and 160,000 shares for account
Loeb & Co. and A. C.
Allyn & Co., Inc. (jointly); Lee
if Mid-Hudson Oil Co., Inc.
of Percy E. Rivett. Price—40 cents per
share, U. S. funds.
Higginson Corp. and Carl M. Loeb, Rhoades & Co.
Nov. 17 (letter of notification)
$200,000 of 5% registered
Proceeds
For development and exploration
(jointly); Stone & Webster Securities Corp. Bids—Had
expenses.
serial notes due July 1, 1955.
Price—At par (in multi¬
Underwriter—To be named by amendment.
*
tentatively been expected to be received up to 11 a.m.
ples of $100).
Proceeds—For working capital, etc.
Of¬
Lee Finance Co.,
(EDT) on June 15 at The Hanover Bank, 70
Minneapolis, Minn.
Broadway,
fice—Prospect St., Poughkeepsie, N. Y.
Underwriter—
New York, N. Y., but
Nov. 3 (letter of notification) 13,000 shares of
offering has been postponed.
preferred
None.
stock (par $10) and $170,000 of 8% subordinate notes
Gunsite Butte Uranium
Corp.
• Mid-States Commercial
due five years from date of issue. Price—At
Corp.
par.
Pro¬
Oct. 25 (letter of
notification) 25,000,000 shares of capi¬
Nov. 9 (letter of notification) 4,800 shares of 7% cumu¬
ceeds—To reduce bank loans and for
working capital.
tal stock. Price—At par (one cent
per share). Proceeds ' Office—305
lative preferred stock.
Northwestern Federal Bldg.,
Price—At par ($10 per share).
Minneapolis,
—/For -exploration and
development expenses. Office— - Minn. Underwriter—Daniels
Proceeds—For working capital.
& Smith.
Office — 2 King St.,
36 West Broadway, Salt Lake
City, Utah. Underwirter
Middletown, N. Y. Underwriter—Frazee, Olifiers & Co.,
if Liberty Oil & Uranium Co., Denver, Colo.
—Melvin G. Glegal & Co., same address.
New York. No general offer planned.
Nov. 19 (letter of notification)
2,900,000 shares of com¬

Avenue,

River

Rouge,

Mich.

Underwriter—^None.

-

\

'

^

—

—

—

—

•

Hackensack Water Co.
28 filed 48,047 shares of

common

being offered for subscription by
arthe rate

of

of Nov.

as

one

new

stock

common

Proceeds

(par $25)

share for each eight shares held

18; rights to expire

on Dec. 6.
Price—$40 per
Proceeds—For capital additions and to purchase
securities of Spring Valley Water Works &

& Co., both of New York.

Harley Patents, Inc.
10 (letter of
notification) 7,900 shares of capital
(par 10 cents). Price—$1.25 per share. Proceeds
-—To underwriter, E. E. Smith Co., New York.
Nov.

Nov.

(George L.) Associates, Inc.
(letter of notification) 295,000 shares of

stock

—For

New

Price—$1 per share. Proceeds'
Underwriter—F. M. Hall & Co.,

1

warrants).
K.
•-

finance

as

agent.

.

-fy

•

• Kulfish

(Tom) Finance Co., Mt. Rainier, Md.
(letter of notification) 6,000 shares of 6% cu¬
mulative preferred stock (par $25) and
18,COO shares of
12

class A

common

stock (par $1).

—For

working capital.
Avenue, Mt. Ranier, Md.
•

Price—At

Office

—

3309

Underwriter—None.

Illinois Telephone Co.,

Bloomington,

Proceeds

par.

Rhode

Island

V

111.^(12/7)

Nov. 17 filed 20,000 shares of cumulative
preferred
series C (par $50).
Price—To be

stock,
supplied by amend-'
ment.
Proceeds
For construction
program.
Under¬
writer—Dean Witter & Co., San
Francisco, Calif.
—

..,

^

of

common

stock

(par

$1).

Price—At

Proceeds—For investment.

market.

™

^

(no

par).

if International
Nov.- 23

Spa, Inc., Reno, Nev.
12,000 shares of common stock
per share.
Proceeds—For land,

filed

Price—$500

tion, working capital, etc.

•

construc¬

Underwriter—Noner*'

•

Interstate Power Co.,
Dubuque, Iowa (11/30)
Oct. 29 filed 200,000 shares of
preferred Stock (par $50).

Proceeds—To redeem 100,000 shares of 4.70%.
preferred
stock at $52.50
per share (plus accrued dividends) and

to repay
$2,000,000 of
To be determined

promissory notes. Underwriter—
by competitive bidding. Probable bid¬
ders: Smith,
Barney & Co.; Blyth & Co., Inc. add Leh¬
man
Brothers (jointly); Merrill
Lynch, Pierce/ Fenner
& Beane and
Kidder, Peabody & Co. (jointly WBids
—To be received
327 So. La Salle

up

of

common

capital

stock.

stock

(par

to 10:30

a.m.

St., Chicago 4,




iil.

(CST)

on

adjustment)..

Monte

Oct.

cent). Price—Five cents per share. Pro¬
exploration and development expenses. Of¬
Virginia St., Reno, Nev.
Underwriter—
McCoy & Willard, Boston,. Mass.
one

Loma Uranium Corp.,

-

(.12/15)

common

stock ^(par 10

Mac Fos

Uranium, Inc., Salt Lake City, Utah
Sept. 16 (letter of notification) 4,000,000 shares of com¬
mon stock (par one cent).
Price—Three cents per share
Proceeds—For exploration and development costs. Office
—239 Ness Bldg., Salt Lake City, Utah.
Underwriter—
Utah Securities Co., same city. •

Magic Metals Uranium Corp.
Sept. 14 (letter of notification) 2,995,000 shares of
stock

one cent).
Price — 10 cents per share.
exploration and development expenses.
South, Salt Lake City, Utah. Under¬
writer—Mid-Coninent Securities, Inc., the same city.

Uranium Corp.,

(par

one

cent).

exploration

Underwriter—James

E.

Moab,

Utah

3,000,000 shares of

Price—10
and

Reed

cents

Co.,

expenses.

North

139

com¬

per' share.

development

Virginia

•

Monterey Oil Co .(12/8)
17 filed

stock

(par

maximum

a

$1).

of

Price—To

300,000 shares of common
supplied by amendment),

be

(initial offering price to be related to the then current
price on the New York Stock Exchange. Proceeds—To
indebtedness

reduce

incurred

in

Oil

purposes.

Gas

Fabrics,

Corp.

Inc.,

and

Pawtucket,

R. I.

Sept. 24 (letter of notification) 40,000 shares of common
stock.

Price—At

par ($7.50 per share).
Proceeds—For
Office—45 Washington St., Pawtucket,
R. I. Underwriter—Barrett & Co., same city.

working capital.

if Morehouse-Gorham Co., Inc.
18 (letter of notification) 2,000 shares of 6% cum¬
Price—At par ($50
per share).
Proceeds—For working capital, etc.
Busi¬
ness—Publishers and distributors of religious books and
supplies.
Office—14 East 41st St., New York 17, N. Y.

Nov.

ulative convertible preferred stock.

Underwriter—N one.
•

Nacimiente
15

Uranium

Mining Corp.

(letter of notification)

1,470,000 shares of com¬

stock

(par one cent). Price—20 cents per share.
Proceeds—For exploration and development costs.
Of¬

Nov530 at

fice—208 Korber
—None.

Magic Uranium Co., Inc., Salt Lake City, Utah
Oct. 15 (letter of notification) 3,000,000 shares of com¬

Sept. 29 filed 381,018 shares of common stock (no par)

stock (par one cent).
Price—10 cents per share.
Proceeds—For development and exploration costs. Of¬
fice—529 Newhouse Bldg., Salt Lake City, Utah.
Un¬
derwriter—I. J. Schenin Co., New York.

Bldg., Albuquerque, N. M.

Underwriter

•'

National Fuel Gas Co.
v

being offered for subscription by common stockholders
of record Nov. 8 on the basis: ©f one new share for each
ten

shares

held

(with

an

oversubscription

privilege);,

Nov. 29. Price—$17.75 per share. Pro¬
ceeds—For investments in and advances to subsidiaries.

rights to expire

Underwriter—None.

if Marine Midland Corp., Buffalo, N. Y.
tobe

if New England Tel. & Tel. Co. (12/14)
Nov. 23 filed $30,000,000 of 34-year debentures due Dec.,

Dec. 8.

15, 1988.
Proceeds—To repay advances from American
Telephone & Telegraph Co., the parent.
Underwriter—
To be determined by competitive bidding. Probable bid*

Nov.

18

filed

426,000 shares of

common

stock

(par $5)

offered in exchange for
outstanding stock of
Genesee Valley Trust Co., at rate of W\ shares of com¬
mon
stock for each Genesee shares held of record on

ers

of

Offer is subject to acceptance thereof
less than 80%
(80,000 shares) of

not

b,y hold¬
Genesee

stock.

ders:

The

Halsey, Stuart & Co. Inc.; Morgan
Boston Corp.; Glore, Forgan

First

Loeb & Co. and Union Securities

Marion River Uranium Co.
June 14 (letter of notification) 300,000
stock (par 10 cents).
Price—$1 per

shares of common
share. Preceeds—

'

Underwriter—Lehman Brothers, New York.

Moore

&

Stanley & Co.;

& Co.; Kuhn,
Corp. (jointly). Bids-

Expected to be received up to 11 a.m. (EST) on Dec.

Continued

on

page

14.

44

^
-

purchase of assets of
for general corporate

Fullerton

Office—65 East 4th

mon

,

St., Reno, Nev.

mon

(par

to^run from Dec. 6 and

of notification)

Proceeds—For

Nov.
com¬

Cristo

(letter

stock

Nov.

Denver, Colo.

Long Island Lighting Co. (12/7)
10 filed $15,000,000 of first mortgage bonds due
1984. Proceeds—To repay bank loans. Underwriter—To
be determined by competitive bidding.
Probable bid¬
ders: Halsey, Stuart & Co. Inc.; W. C. Langley &
Co.;
Blyth & Co., Inc. and The First Boston Corp. (jointly);
Smith, Barney & Co.; Baxter, Williams & Co. Bids—Ex¬
pected to be received up to 11 a.m. (EST) on Dec. 7.

mon

5

mon

N.

expected

Brothers; Blyth & Co., Inc. and Shields & Co. (jointly);
White, Weld & Co. and Kidder, Peabody & Co. (jointly);
W. C. Langley & Co. and The First Boston Corp.
Bids—
Expected to be received up to 11 a.m. (EST) on Dec. 2.

Proceeds—For investment.

common

Offer

expire Dec. 20. Underwriter—To be determined by com¬
petitive bidding.
Probable bidders: Union Securities
Corp. and Equitable Securities Corp. (jointly); Lehman

Proceeds—For

• Incorporated Income Fund, Boston, Mass. • >
Nov.
24
filed
(by amendment) -1,599,870 additional
shares

shares

•
Mississippi Power & Light Co. (12/2)
Sept. 3 filed 44,476 shares of cumulative preferred stocky
(par $100) to be offered in exchange for a like number
of outstanding shares of $6 cumulative preferred stock
(no par)
on
a
share-for-share basis
(with a cash

Nov.

one new share for each seven shares

■

Nov.

980,000

Inc.,

Price—$1.25 per share. Proceeds—For explora¬
tion and development costs, purchase of
equipment, and
reserve for acquisition of additional
properties. Under¬
writer—Peter Morgan & Co., New York.

held; rights to expire Dec. 15. Price — At par ($5 per
share).
Proceeds—To feduce bank notes.
Office—107
Valley Street, Emporia, Va. Underwriter—None/'
'

share.

cents).

Telephone & Telegraph Co. of Virginia
Oct. 18 (letter of notification)
40,320 shares of capital
stock being offered to stockholders of record Nov.
18,
the basis of

per

—

June 18 filed 1,000,000 shares of

Price—At par ($10 per share). Proceeds—
home improvements.
Underwriters-Robert

Berry, Westfield, N. J., to act

on

cents

Corp., Reno, Nev.
(letter of notification) 5,500,000 shares of

Nov. 5

•

Home

1954,

Price—10

ceeds—For

Improvemnt Financing Corp.
(amendment) 30,000 shares of 6% cumulative
preferred stock (with class A common stock purchase

To

filed

fice—206

Home

July

cent).

and

Lincoln Uranium

com¬

(par 10 cents).

working capital.
York, N. Y.

19

Price—At market.

^Headley
mon

one

oil

★ Life Insurance Stock Fund,
Birmingham, Ala.

stock

15

For

—

Liberty Uranium Corp., Salt Lake City, Utah
V.
July 1 (letter of notification) 3,000,000 shares of common
stock
(p§r one cent). .Price—Three cents per share.
Proceeds—For mining operations.
Office—402 Darling
Bldg., Salt Lake City, Utah.
Underwriter — Uranium
Mart, Inc., 146 S. Main St., Salt Lake City, Utah.

Supply Co.
Corp. and White, Weld

Underwriters—The First Boston

(par

mining activities.
Office
250
Equitable Bldg., Denver, Colo. * Underwriter — Carroll,
Kirchner & Jaquith, Inc., same city.

stockholders

share..

Oct.

stock

mon

Oct.

„

44

The Commercial and Financial Chronicle

(2180)

Continued

from

page

43

New Orleans Public Service Inc.

Nov.

5

filed

Proceeds

—

it Public Finance Corp. of Alaska,
Anchorage, Alaska
Nov. 16 (letter of notification) 20,COO shares of common
stock (par $10).
Price—$15 per share. Proceeds—For
opening of new offices in Juneau and Seward, Alaska,

.

(12/14)

$6,000,000 first mortgage bonds due 1934.
construction program. Underwriters —

For

competitive bidding. Probable bid¬
Halsey, Stuart & Co. Inc.; Equitable Securities
Corp.; Union Securities Corp. and Harriman Ripley &
Co. Inc. (jointly); Lehman Brothers, Kidder, Peabody &
Co. and Stone & Webster Securities Corp. (jointly); The
First Boston Corp.; White, Weld & Co. Bids—Expected
to be received up to noon (EST) on Dec. 14.
To be determined by

and for loans.

ders:

New Silver Belle

Public

Mining Co., Inc., Almira, Wash.

writers—Percy Dale Lanphere and R. E. Nelson & Co.,
both of Spokane, Wash.

ceived

of New

Telephone & Telegraph Co.
Nov. 10 (letter of notification) 2,000 shares of common
stock (par $100) to be offered for subscription by stock¬
holders.
Proceeds—To
repay
loan.
Office—Elizabeth

to 11 a.m. (EST) on Nov. 30 at Room 120;
House, Tremont and School Sts., Boston, Mass.

up

Parker
Norfolk & Carolina

Quaker Warehouse Co., Inc., Philadelphia, Pa.
10 filed $900,000 of 10-year 6% debentir^s due
Sept. 1, 1964, to be offered to stockholder members of
Quaker City Wholesale Grocery Co., a 100% cooperative
Sept.

Underwriter—None.

retail

owned organization.

grocer

Price—At

Ol Jato Uranium Co., Salt Lake City, Utah
•
Aug. 5 (letter of notification) 1,750,000 shares of common
cFtdOk (par one cent); Price—15 cents per share.
Pro¬
ceeds—For mining operations.
Office—114 Atlas Bldg.,
Salt Lake City, Utah. Underwriter — Rocky Mountain
Securities, the sa'me'city. - *.(
I.
"
•

Old

Hickory Cojpper Co., Phoenix, Ariz.
Oct. 7 (letter of notification) 750,000 shares Of common
stock (par 10 cents).
Price—40 cents per share. Pro¬
ceeds
For mining expenses. Offices — Mayer-Heard
Bldg., Phoenix, Ariz., and 2 Broadway, New York, N. Y.
Underwriter—General Investing Corp., New York.
Of¬
—

fering—Not expected until early in

Ar Olsen

(C. A.)

1955.

;

Manufacturing Co., Elyria, Ohio

(12/15)

Pro¬
ceeds—To purchase building, and for modernization and
improvements. Underwriter—None.

selling stockholders.
furnaces for
&

•

Business

residential

—

Produces

warm

air

Underwriter—Hornblower

use.

Weeks, New York.

Corp. (11/26)
(letter of notification) $295,000 of 5xk% six-year
debentures, due Oct. 1, 1960, and 29,500
shares of common stock (par one cent) to be offered in
units of one $1,000 debenture and 100 shares of stock.
Price —$1,001 per unit.. Proceeds — To retire
debt, buy
equipment and for working capital, etc. Office—Martha's
! Vineyard, Mass. Underwriter—John R, Boland &
Co.,
Inc., New York.
Oct. 28

convertible

.

•

Investing Corp. (Del.), Jamaica, N. Y.
Nov. 17 (letter of
notification) 2,500 shares of common
stock.
Price—At par ($100 per
share) and accrued divi¬
dends.
Proceeds
For working
capital, etc.
Office —
181-14 Hillside Ave.,
Jamaica, L. I., N. Y. Underwriter
—

—None.

(Northern Rhodesia)

it One-Hour Valet, Inc., Miami, Fla.
18 (letter of
notification) 30,000 shares of common
stock
(par,$l), of which 9,450 shares are to be offered
and

company

20,550 shares for the account of
Price—$5 per share.
Proceeds—

selling stockholders.
For

of

investment in

subsidiaries.

new

Office

—

Chamber

Commerce Bldg.,

Dickson

&

Miami, Fla.
Underwriters
R. S.
Co., Charlotte, N. C.; Courts & Co., Atlanta,
—

Ga.; Clark, Landstreet & Kirkpatrick, Inc.,
Nashville,
Tenn.; and Willis, Kenny & Ayers, Inc.,
Richmond, Va.
>

* Oroco Oil & Gas Co., Aibuquerque,

Nov.

*A'ov.

18

filed

stock (par $1).
Proceeds—To pay

outstanding debts and for drilling operations
general
Pierce &
•

corporate

Underwriter

purposes.

and

—

Co., Dallas, Texas.

other

Rauscher,

Paraderm

Laboratories, Inc. (11/30)
(letter of notification) 250,000 shares of com¬
(par 30 cents). Price—$1 per share.
Pro¬
ceeds—For working capital.
Office—415 Congress
St.,
Portland, Me. Underwriter
Sheehan &
Nov.

12

mon

stock

—

Co.,

Mass.

Utah
6,000,000 shares

Price—At par

For mining expenses.

(five cents per share).
Office—325 Main St.,

of capital

Proceeds—

Moab, Utah
Underwriter—Van Blerkom &
Co., Salt Lake City, Utah.
Pay Day Uranium Co., Las
Vegas, Nev.
Oct. 15 (letter of
notification) 2,500,000 shares of capital
stock (par two cents).
Price—10 cents per share. Pro¬
ceeds—For exploration and
development costs. Office—
230 Fremont

St., Las Vegas,. Nev.
Underwriter Co., the same
city.

Underwriter—Allied

^

—

Canada.

Telephone

Office

Co.,

Manila, P. I. Underwriter
Loeb, Rhoades & Co., New York.
•

Montreal,

—

Pioneer Finance
Co.,
8 filed 50,000 shares

Nov.

stock

(par $10).

Detroit, Mich.
of

6%

Price—At par.

outstanding debentures

and for

—

Carl

m'

(11/30)

cumulative

preferred
Proceeds—To redeem

working capital. Under¬
Co., Detroit, Mich
and

writers—Watling, Lerchen &
Mullaney, Wells & Co., Chicago, 111.

stock

8

Corp., Moab, Utah
(letter of notification) 75,000 shares

(par $10).

to

be

offered

Richland Uranium Corp., Salt Lake City, Utah
2 (letter of notification) 2,950,000 shares of
capi¬
Price—At par (10 cents per share). Proceeds

Nov.

tal stock.

—For

exploration and development costs. Office—810
Security Bank Bldg., Salt Lake City, Utah. Un¬
derwriter—Jackson & Co., Inc., Boston, Mass.
Rolon Tire Chain

Price—At

stock.

ventory, working capital, sales and production expenses,
etc. Office—150 Tejon
St., Denver, Colo. Underwriter—
Peters, Writer & Christensen, Inc., same city.




Samicol Uranium

of

caoital

tendered

under

an¬

Humble

this

offer.—

!'

/V

stock

(par one cent). Price—Five cents per share.
For exploration and development
costs.
Underwriter—Ned J. Bowman Co., Salt Lake
City, Utah.
mon

Proceeds

•

—

Statler

Hotels Delaware

Corp.

Nov. 4 filed

1,004,509 shares of common stock (par $1)
being offered for subscription by common stockholders
Hilton

of

tive

Hotels

group)

Corp. (except members of its execu¬
the basis of one Statler share for, each

on

Hilton share held

Nov.

on

24; rights to expire Dec. 10.
group have purchased
paid for an aggregate of 650,000 additional shares
of Statler stock.
Price—$6.42 per share. Proceeds—To
finance, in part, purchase of Hotels Statler
Co., Inc.,
properties. Underwriter—Carl M. Loeb, Rhoades &
The

members

of

the

executive

Co.,

New York.'

.

.

_

it Stinnes

(Hugo)

Corp., New York

Nov. 22 filed $6,000,000 of notes and an
unspecified num¬
ber of shares of common stock
(par $5) to be offered
in

units

of

common

ment.

of

$1,000 of notes and
shares.

Price—To

Proceeds—For

;

an

be

retirement

unspecified

number

supplied by
of ,7%

amend¬
debentures of

Hugo Stinnes Industries, Ine.^ due 1946. Underwriters—
Halsey, Stuart & Co. Inc. and A. G. Becker & Co. Inc.,

Chicago and New York.

s

;

,

it

Strutwear, Inc., Minneapolis, Minn.
Nov. 15 (letter of notification)
10,000 shares of common
stock (par $5) to be offered for
subscription by em¬
ployees. Price—Average cost to company, but not ex¬

V.

and

Klein

to

be

for subscription
by stockholders;
Price—To stockholders, $200 per share;
per share.
Proceeds—To increase capital
Office — 1038 Bankers Mortgage

surplus.

Houston 6, Tex.

and

a
horse-racing establishment
Office—Flamingo Bldg., Santurce, P.

bonds

the basis of 500 shares of stock

on

$1,000 bond

to and including Aug. 31, 1958;
per $1,000 bond thereafter and up to and
including Aug. 31, 1963; 250 shares thereafter and up
to and including Aug. 31,
1968; and 200 shares there¬
after to Oct. 15, 1977. It is the present intention of the
management of the company to hold any bonds so
333

up

shares

tendered

for

the purposes of
receiving tax-free income
Statement became effective on Nov. 17.

thereon.

it Sunburst Uranium Corp., Reno, Nev.
15 (letter of
notification) 1,200,000 shares of

Nov.

stock

mon

(par

10

Price—25

cents).

cents

Reno National Bank

development costs. Office
Building, Reno, Nev. Under¬

writer—None.

same

city.

stock

(par five cents). Price—10 cents per share.
exploration and development of proper¬

Office —1406

Life

Underwriter

—

America

of

Western

Building, Dallas,
Corp., Salt

Securities

City, Utah.

Tacony Uranium Corp., Denver, Colo.
Aug. 17 (letter of notification) 1,700,000 shares of com¬
stock.
Price—10 cents per share.
Proceeds—For
exploration and development expenses.
Office — 317
Railway Exchange Building, Denver, Colo. Underwriter
—E. I. Shelley Co., Denver, Colo.,
mon

in

R.

Underwriter—Hunter Securities Corp., New York.
San Juan

Uranium Exploration, Inc.
(letter of notification) 2,840,000 shares of com¬
(par one cent).
Price—10 cents per share.
Proceeds—For exploration and development costs. Of¬

—U. S. funds.

fice—718 Kittredge Bldg.,
Denver,

ment expenses and

Nov.

Tarbell

2

stock

Rogers & Co.,

same

Colo.

(par

five

Oct.

cents),

7

mon

common

stock

(letter of notification)

Office—39

ment.

due

1975.

Price—To be supplied by

1972; $24,750,000 4%

bonds and $29,400,000 4Ye% bonds

$21,000,000 outstanding short term
notes; and for general corporate purposes. Underwriters

Stancan Uranium

Corp., Toronto, Canada (12/8)
1,750,000 shares of common stock (par 10).

Nov.

Proceeds—To acquire uranium
exploration and development work.

Oil Co.
(New Jersey)y.n \
8,969,055 shares of capital stock (par
$15)
being offered in exchange for Humble Oil. &
Refining
Co. capital stock on the basis of
nine shares of Standard
15

price

The offer

was

subject to tender

17
—

repay

filed
To

700,000

be

Houston, Texas

shares

supplied

of

capital

by amendment.

stock

(par $1).
Proceeds — To

bank loans and for drilling development and ex¬
Underwriter—Allen & Co., New York.

ploratory costs.

filed

for 10 shares of Humble.

Corp.; White, Weld & Co.;

Halsey, Stuart & Co. Inc.

it Texam Oil & Gas Co.,

share.

Standard

Oct.

pipe

amend¬

both due 1973; to pay

and

for

Un¬

Proceeds—To redeem $38,450,000 3%% bonds due

—Stone & Webster Securities

and

expenses.

Tennessee Gas Transmission Co. (12/8)
17 filed $125,000,000 of new first
mortgage

line bonds

City, Mo.

claims

com¬

share.

Exchange Place, Salt Lake City, Utah.

Bldg., Salt Lake City, Utah, and 1016 Baltimore
Bldg.,
Kansas City, Mo. Underwriter—E. R. Bell &
Co., Kansas

per

per

Nov.

—

Price—$1.50

3,500,000 shares of

(par V-k cents). Price — 3 eents
exploration and development

derwriter—Walter Sondrup, same city.

Uranium & Oil Corp., Inc.
(letter of notification) 2,000,000 shares

4 filed

Underwriter

Proceeds—For

of com¬
mon stock
(par one cent). Price — 10 cents per share.
Proceeds—For mining expenses. Offices
506 Beason

Nov.

and develop¬

Temple Mountain Uranium Co.

Development Corp.

Solomon
7

Proceeds—For exploration

acquisition of property.
Cooney & Co., New York.

—H. J.

including shares for option to
underwriter and prior property owner to be amended.
Price—10 cents per share.
Proceeds—For development
and exploration expenses. Office—Newhouse
Hotel, Salt
Lake City, Utah. Underwriter
Van Blerkom &
Co.,
same city.
Oct.

24

stock

Underwriter—

Oct. 8 (letter of notification)
2,900,000 shares of
stock

Mines, Ltd. (Canada)
(Regulation "D") 599,760 shares of common
(par $1—Canadian). Price—50 cents per share.

Sept.

address.

Slick Rock Uranium

com¬

share.

per

Proceeds—For exploration and
—211

Lake

Underwriter—None.

operate

Rico.

revenue

Texas.

Bldg.,

Juan Racing Association
(Puerto Rico)
(letter of notification) 100,000 shares of common
stock (par 50 cents).
Price—$3 per share. Proceeds—To
build

ment

for each

ties.

1

Puerto

•
Stylon Corp., Milford, Mass.
Sept. 27 filed 650,000 shares of common stock (par $1)
being offered to the holders of the $1,300,000 City of
Florence, Ala., 5% first mortgage industrial develop¬

mon

San

Oct.

Office—1015

Underwriter—

Proceeds—For

public.
public, $210

and

Proceeds—None.

Minneapolis, Minn.

Sytro Uranium Mining Co., Inc., Dallas, Texas
Sept. 9 (letter of notification) 2,975,000 shares of com¬

offered

to

Street,

Brokers, Inc., the

it San Jacinto Insurance Co., Houston, Tex.
Nov. 19 (letter of notification) 640 shares of
common
stock

share.

per

—For development and exploration costs. Office—Medi¬
cal Arts Bldg., Las Vegas, Nev. Underwriter—Uranium

exploration expenses, etc.
Underwriters—R.
and McGrath Securities
Corp., both of

Co.

New York.

$5

Sixth

Sept. 1

Sept. 14 filed 300,000 shares of common stock (par 10
cents).
Price—$2 per share.
Proceeds—For develop¬
ment

ceeding

Superior Uranium Co., Las Vegas, Nev.
(letter of notification) 29,910,000 shares of com¬
mon stock.
Price—At par (one cent per share). Proceeds

Corp., Santa Fe, N. M.

■-

Proceeds—To redeem
outstanding debentures and for working capital. Under¬
writers—Watling, Lerchen & Co., Detroit, Mich, and
Mullaney, Wells & Co., Chicago, 111.
par.

Corp., Denver, Colo.
(letter of notification) 60,000 shares of Common
Price—$1 per share. Proceeds—For increased in¬

Oct. 27

Underwriters—Gearhart & Otis, Inc., New,
York, and
Crerie & Co.,
Houston, Texas.
-

Pioneer Uranium
Oct.

Ltd.

—

Philippine Long Distance Telephone Co. (11/30)
Nov. 8 filed 310,285 shares of
capital stock (par 10 pesosPhilippine). Price—To be supplied by
amendment. Pro¬
ceeds
To Anglo-Canadian

already been
Underwriter—None.

South

Trust

mon

Paramount Uranium
Corp., Moab,
(letter of notification)

Oct. 7
stock.

Boston,

than

more

have

at

The

None.

12

by subscription warrants
to holders of American shares.
(Rhodesian's principal
offices were transferred from England to
Lusaka, North¬
ern
Rhodesia, in 1953, and its principal asset consists of
shares of the Mufulira Copper
Mines, Ltd., Northern
Rhodesia.) Proceeds of Rhodesian's offering of its shares
will be used to subscribe to
pro rata shares of a stock
offering by Mufulira; the balance for general corporate

to

520,000 shares of capital

Price-r-To be supplied by amendment.

own

was

Corp., Salt Lake City, Utah
:i;j
Aug. 2 (letter of notification) 6,000,000 shares of com¬

filed
100,000 American shares to be issued
against deposit of ordinary shares of Rhodesian Selec¬

then

N. Mex.

[On Nov., 15 it
2,765,616 shares of

Star Uranium

tion

•

Nov.

the

Rhodesian Selection Trust Ltd.

First

^Olympic

by

Reinforced Plastics

purposes.

-Nov. 24 filed 225,000 shares of common stock
(par $5).
Price—To be supplied by amendment.
Proceeds—To

that

that Standard will

30, 1954.

par.

and

—

nounced
stock

so

of the Humble Oil capital stock.

more

and

Northern California

Plywood, Inc.
Sept, 13 filed 300 shares of common stock (par $5,000)
5,000 shares of 5% cumulative participating pre¬
ferred stock (par $100).
Price—At par.
Proceeds—To
purchase properties of Paragon Plywood Corp. and pur¬
chase of raw materials.
Office
Crescent City, Calif.
Underwriter—None. Sales to be made through Raymond
Benjamin Robbins.

Service Co.

2,765,616 shares

offer expires on Nov.

Ed.]

Hampshire (11/30)
Nov. 5 filed $12,000,000 first mortgage bonds, series H,
due 1984.
Proceeds—To redeem $2,968,000 of 3%% se¬
ries F bonds at $105.15 and $7,000,000 of 4% series G
bonds at $103.75; and to repay short-term borrowings.
Underwriter—To be determined by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Lehman
Brothers; White, Weld & Co.; Kidder, Peabody & Co.
and Blyth & Co., Inc. (jointly); Salomon Bros. & Hutzler; The First Boston Corp. and Coffin & Burr, Inc.
(jointly); Equitable-Securities Corp. Bids—To be re¬

Sept. 8 (letter of notification) 500,000 shares of common
stock (par two cents).
Price—10 cents per share. Pro¬
ceeds—For exploration and development costs.
Under¬

City, N. C.

Underwriter—None.

of at least

least 80% or
-

Thursday, November 25,1954

...

-

it Texas Glass Fibre Corp.
Nov. 10 (letter of notification) 50,000 shares of common
stock-. Price—At par ($5 per share). Proceeds—For im¬
provements and working capital.
Office — Grandview,
Underwriters—Keith Reed & Co., Inc. and Eppler, Guerin & Turner, of Dallas, Texas; Muir InvestTexas.

Number 5380 V.'. The Commercial and Financial Chronicle

Volume 180

(2181)

Corp. and Texas National Corp., of San Antonio,

ment

Texas International
June 21

v

Sulphur Co.

filed

455,000 shares of common stock (par 10
cents), of which 385,000 shares are to be offered for
subscription by common stockholders at the rate of one
new share for each 4% shares held; and
70,000^ shares
are for account of certain selling stockholders. Price—-To
be supplied by amendment. Proceeds—For exploration
and drilling, and payment of bank loans and advances.
Underwriter—Vickers Brothers, New York, on a "best ef¬
forts" basis.

exploration

and

development

expenses

Underwriter<

★ Van Horn Butane Service, Frescno, Calif.
Nov. 17 (letter of notification)
24,998 shares of common
stock (par $2.50) to be offered for
subscription by stock¬
holders

the

on

shares

basis

of

one

new

share

for

each

10

held; unsubscribed shares to be offered to em¬
Price—$6 per share. Proceeds—For working

ployees.
capital.
—J.

Address—Box 547, Fresno, Calif.

Barth

&

Co.

and

Schwabacher &

Underwriters

Co., both of San

(letter of notification) 1,800,000 shares of com¬
(par 10 cents). Price — 15 cents per share.
Proceeds—For mining activities. Office—206 N. Virginia

Aug. 3

stock

St., Reno, Neb. Underwriter—Stock, Inc., Salt Lake City.
Trans-Continental

Uranium

Corp.

$1)

in

per

unit.

units

of

one

share

of

each

class.

Price—$3.10
Proceeds—For exploration and development
Office—1812 St. Catherine St. West, Montreal,

Canada.

Transport Indemnity Co., Los Angeles, Calif.
9 (letter of notification)
14,230 shares of capital
(par $10) to be offered for subscription by stock¬
holders of record Nov. 20, 1954, on the basis of one new
share for each five shares held; rights to expire on Dec.
20, 1954. Price—$20 per share to stockholders; remain¬
ing shares, if any, may be sold to affiliate at $23.50, but

held

(with

Nov.

pire

on

stock

construction

aggregate amount will not exceed $300,000.

ceeds—For expenses incident to
mining operations. Ad¬
dress—P. O. Box 289,
Wallace, Idaho. Underwriter—Al-

stock.

for

capital

Proceeds—

surplus. Office—3670 Wilshire
Underwriter—None.

and

Blvd.,

Los Angeles 5, Calif.

Underwriter—None.

City, Utah.
Nov.
and

Paradise,

offered

83,334 shares of common stock (par $10)
shares of preferred stock (par $20) to be

units

in

Price—$30

of

one

share

of

each

class

of

stock.

unit. Proceeds—To construct racing plant
and tp repay obligations. Underwriter—Selected Securi¬
ties, Inc., Phoenix, Ariz.
per

Ucolo Uranium Co., Salt Lake City, Utah

Sept. 13 (letter of notification) 2,800,000 shares of com¬
mon stock (par one cent).
Price — 10 cents per share.
Proceeds—For exploration

600,000 shares of common stock (par $10)
being offered for subscription by stockholders of record

Nov. 23

and development costs.

Of¬

—

Drilling Corp.

Oct. 4 (letter of notification) 300,000 shares of common
stock. Price
At par ($1 per share). Proceeds — For
—

cost of Driller Boy

(drilling equipment which company
out), and working capital. Office—c/o Edwin J.
Dotson, attorney-at-law, Simon Bldg., 230 Fremont St.,
Las Vegas, Nev.
Underwriter—Robert B. Fisher In¬
vestments, 510 South Fifth St., Las Vegas, Nev.
rents

Urainbow, Inc., Salt Lake City, Utah
(letter of notification) 2,000,000 shares of com¬
(par two cents). Price—15 cents per share.
For exploration and development expenses.

stock

—

Uranium Corp. of Colorado
Sept. 23 (letter of notification) 300,000 shares of common
stock (par one cent).
Price—$1 per share. Proceeds—
For exploration and development costs.
Office —129
•

60th

St., New York, N. Y. Underwriter—None.

stock.

Price—At

ceeds—For

core

(five cents

par

drilling

program

claims.

per

upon

share).

two

Address—Box 709, Wallace, Idaho.
—Wallace Brokerage Co., some city.

Pro¬

of
Underwriter
groups

Uranium of Utah, Inc., Provo, Utah
Sept. 14 (letter of notification) 3,000,000 shares of com¬
mon
stock (par 1 cent).
Price —10 cents per share.
Proceeds—For exploration and development costs. Office
227
N. University Ave., Provo,
Utah.
Underwriter-

Bay Securities Corp., New York.

Uranium, Inc., Salt Lake City, Utah
(letter of notification) 6,000,000 shares of

7

mon

stock

stockholder.

com¬

(par

one cent). Price—Five cents per share.
exploration and development costs. Of¬
Building, Salt Lake City, Utah. Under¬
writer—Western Securities Corp., Las
Vegas, Nev.

Utah Apex Uranium Co.

(letter of notification) 3,000,000 shares of capi¬
(par three cents). Price—Six cents per share.

Proceeds—For

exploration and development expenses.
Office—430 Judge Bldg., Salt Lake
;City,. Utah. Under¬
writer—Mid-Continent Securities, Inc., same city.
Utah Premier Uranium Co.
Oct. 19 (letter of notification)

(par

5,000,000 shares of

com¬

cent).

Price—Five cents per share.
incident to mining operations.
Office
516 Continental Bank
Bldg., Salt Lake City,
Utah. Underwriter—J. E. Call &
Co., same city.
Proceeds—For

one

expenses

—

Utah Uranium Corp., Las
Vegas, Nev.
Aug. 20 (letter of notification) 10,000.000 shares of
capi¬
tal stock (par 1
cent). Price — Three cents per share.




jwfD

'van

Piospective Offerings
Aluminium, Ltd.

Nov.

23 stockholders
approved a proposal to increase
authorized capital stock from
10,000,000 shares (9,029,193 shares outstanding) to 20,000,000 shares
(no par
value) of which a part may be offered for
the

Underwriter—Barrett

Herrick

&

Co.,

subscription

by stockholders.
will

amount

Price—It is expected that the
proceeds

to

approximately

$40,000,000.

For expansion
program.

Proceeds—

Dealer Managers
In April,
1953, The First Boston Corp.,* A. E. Ames &
Co., Ltd.,
and White, Weld & Co.
managed a group of soliciting
dealers to procure subscriptions for the
shares. Offering
—Probably early in 1955, with directors to meet Dec. 7.
—

★ Amalgamated Bank of New York
Nov. 22, Jacob S.
Potofsky, President
stated that the

bank

and

Chairman,

is

offering to its stockholders 40r000 additional shares of
capital stock (par $10) on a pro
rata basis.
Price—$12.50 per share. Proceeds—To in¬
crease capital and
surplus. Underwriter—None.*
American
Nov.

11

it

Discount Co.

of

Georgia

(12/15)

was

(par $50). Underwriters—A. M. Law & Co.;
Johnson,
Lane, Space & Co. and Interstate Securities Corp.

★ Bank of Asheville, N. C.

per

ture and

one

$50 deben¬

share of stock.

Price—To be supplied by
tmendment. Proceeds—From sale of units and
1,125,000
additional shares of common stock and private sales of
one

$55,000,000 first mortgage bonds to be used to build s
1,030 mile crude oil pipeline.
Underwriters — White,
&

Co.

and

Union

Securities

Corp., both of New
Offering—Postponed indefinitely.

West Coast Pipe Line Co., Dallas, Tex.

15

stockholders

of

•..

record

Nov.

13

were

ceeds—Together with other funds, to be used to build
pipeline. Underwriters—White, Weld & Co. and Union
Securities Corp., both of New York.
Offering—Post¬
poned indefinitely.
Sept. 16 (letter of notification) 133,333 shares of common
stock (par 10 cents).
Price—At market (estimated at
36% cents).
Office

Cantor

Proceeds—To certain selling stockholders.

32 Broadway,

—

New York.

Underwriter

—

S. B.

Co., New York.

,

A Western Empire Uranium Co.
16 (letter of notification) 2,750,000 shares of com¬
mon
stock.
Price—At par (10 cents per share).
Pro¬
ceeds—For mining expenses.
Office—Silver State Bldg.,

Denver, Colo.
Western

Underwriter—L. A. Huey Co.,

Plains

Oil

& Gas

same

city.

Co.

Office—Glendive, Mont.
Rice & Co., St. Paul, Minn.

Underwriter—Irving J.

Precipitation Corp., Los Angeles, Calif.
Oct. 21 filed 60,000 shares of common stock (par $1).
Price—$8.75 per share.
Proceeds—For working capital,
etc. Business—Designs, manufactures and installs equip¬
ment used for clearing industrial gases.
Underwriter—
Wagenseller & Durst, Inc., Los Angeles, Calif.
Oil

&

& Co., New York.

> Willingham Finance Co., Inc., Augusta, Ga.
Nov. 15 (letter of notification) 10,000 shares of common
issuable

upon

Price—

exercise of stock options.

share). Proceeds—For working capital.
Office—917 Reynolds Street, Augusta, Ga. Underwriter
($1

per

.

Nov. 1 it
is

soon

was

of)

(12/15)

reported sale of $30,000,000 of

new

bonds

expected.

Underwriter—Morgan Stanley & Co.,
Registration—Expected tomorrow (Nov.

New York.

26)^

★ Big Dollar Food Stores, Inc.

,

i.,.r

reported company plans to issue and sell
shares of common stock. Price—$3 per share.

100,000

was

Business—Operates

five stores in Westchester County,
Underwriter—Baruch Brothers & Co., Inc., New-

N. Y.
York:
★

-

Broadway-Male Stores,
16

stockholders

preferred

stock

260,000 shares.
issue of $1.25

voted

Inc., Los Angeles,
to

increase

the

Calif.

authorized

(par

$25)
from
136,624
shares
toIt is planned to offer in exchange a new
preferred stock for the present $1.15 pre¬

ferred stock and sell 63,376 additional shares to finance
expansion and provide working capital.
Previous pre¬

ferred stock financing was done

privately in 1951.

Byers (A. M.) Co.
'
'
Oct. 11, A. B Drastrup, President, announced that com¬
pany plans to refinance the 42,277 outstanding shares
.

of

7%

preferred stock (par $100)
preferred stock and possibly

of

preferred

also

a

new

include

issue

issuing

stock.

Proceeds—To retire existing
stock and for capital expenditures and
worfo*(
common

ing capital.

nancing

through

was

f

Underwriter—Previous preferred stock fi¬
handled by Dillon, Read & Co. Inc., New

York.

Central

Sept. 2 it

&

was

Southwest

Corp.

reported company plans issue and sale of

between

500,000 to 600,000 additional shares of com¬
stock, probably first to stockholders. Underwriter
—May be determined by competitive bidding. Probable

bidders; Blyth & Co., Inc. and Smith, Barney & Co.
(jointly); The First Boston Corp. and Merrill Lynch,
Pierce, Fenner & Beane (jointly); Lehman Brothers and
Lazard Freres & Co.
until

(jointly).

Offering—Not expected

early in 1955.

Chesapeake & Ohio Ry.
Sept.

29 it was reported company plans to issue and
$40,000,000 of new bonds. Proceeds—To refund it£
outstanding $37,851,000 37/s% bonds and $2,441,000 4%
sell

bonds.

Underwriter—May be determined by competitive
bidders: Halsey, Stuart & Co. Inc.;

bidding. Probable
Blyth & Co., Inc.

★ Chicago, Burlington & Quincy RR.
Nov. 22 it was announced company has applied to ICC
authority to issue and sell $4,800,000 of equipment

for

trust

certificates to be dated Dec. 1, 1954, and to ma¬
semi-annually to and including Dec. 1, 1969. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Salomon Bros.
& Hutzler; Kidder, Peabody & Co.
ture

World

Uranium Mining Corp.
(letter of notification) 9,996,000 shares of com¬
stock
(par one cent).
Price — Three cents pet

July 21
mon

(Kingdom

surplus. Under¬
writers—McCarley & Co., Inc. and Merrill Lynch, Pierpe,
Fenner & Beane, both of
Asheville, N. C.

Minerals

Corp.
Nov. 2 (letter of notification) 300,000 shares of common
stock (par 10 cents).
Price—$1 per share. Proceeds—
For expenses incident to oil activities.
Office — 728
Columbus St., Rapid City, S. D. Underwriter—Fenner-

par

Belgium

Capital and

mon

Western

Wilco

Proceeds—For

additional

May 24 filed 100,000 shares of common stock (par $1).
Price—$4.75 per share. Proceeds—To redeem 1,250 out¬
standing preferred shares ($125,000), to repay bank
loan, etc. ($2,500); for purchase or acquisition of addi¬
tional mineral
interests, leases and royalties in the
poses.

Price—$2q

share.

Nov.

Western Central Petroleums, Inc., N. Y.

offereji

right to subscribe on or before Dec. 15 for 2,500 ad¬
ditional shares of capital stock
(par $10) on the basis of
new
share for each eight shares held.

one

Nov. 17 it

Nov. 20, 1952 filed 1,125,000 shares of common stock (pai
50 cents). Price—To be supplied by amendment. Pro¬

\

reported company plans issuance anck
of 15,000 shares of 5% cumulative
preferred stock*

sale

Nov.

None.

tal stock

★

(par 50 cents) to be offered in units of

At

Felt

stock

Boston, Mass.

the

stock

mon

(par one cent). Price—$1 per share. Proceeds
mining operations.
Underwriter—Sheehan & Co.

For

West Coast Pipe Line
Co., Dallas, Tex.
Nov. 20, 1952 filed $29,000,000
12-year 6% debenture!
due Dec. 15, 1964, and 580,000 shares of common stock

fice—420

18

Samuels

Inc., New York.

Proceeds—For

Oct.

Co.,

Pro¬

Washington Natural Gas Co., Clarksburg, Va.
Sept. 20 (letter of notification) 10,000 shares of common
stock.
Price—At the market (estimated at
$1.37% per
share). Proceeds—To Elizabeth D. Hardman, the sell¬

Streitman

Utaco
Oct.

Brokerage

com¬

United States and Canada and for other corporate pur¬

★ Uranium Discovery & Development Co.; ^
Wallace, Idaho
Nov. 16 (letter of notification) 1,000,000 shares of
capi¬
tal

8.

Nov.

Office—908 Kearns Bldg., Salt Lake City, Utah. Under¬
writer—Austin B. Smith Brokerage
Co., the same city.

East

an

Dec.

J. Teske, d/b/a Wallace
Hotel, Wallace, Idaho.

York.

Uranium, Inc., Salt Lake City, Utah.
Oct. 5 (letter of notification) 15,000,000 shares of com¬
mon stock (par one cent).
Price—Two cents per share.
Proceeds
For exploration and
development costs.
Office—424 Judge Bldg., Salt Lake City, Utah. Under¬
writer—James E. Reed Co., same city.

share for each 10 shares

Vulcan-Uranium Mines, Inc., Wallace, Idaho
15 (letter of
notification) 1,500,000 shares of
mon stock.
Price—At par (five cents per share).

Uintah

Proceeds

one new

Oct.

derwriter—Western Securities Corp., the same city.

mon

the basis of

on

oversubscription privilege); rights to ex¬
Price—$29 per share.
Proceeds—For
program.
Underwriter—Stone & Webster
Securities Corp.

Weld

Aug. 31

Co.

Oct. 22 filed

fice—906 Walker Bank Bldg., Salt Lake City, Utah. Un¬

Universal Petroleum Exploration &

Underwriter—B. Fennekohl & Co., New York.

Virginia Electric & Power

ing

Inc., Phoenix, Ariz.

filed

12

83,334

•

den

★ Triangle Mines, Inc., Salt Lake City, Utah
Nov. 19 (letter of notification) 180,000 shares of common
stock (par 50 cents).
Price—$1 per share.
Proceeds—
For mining expenses.
Office—485 4th Ave., Salt Lake
Turf

stock

Vigorelli of Canada, Ltd. (Canada)
Aug. 9 (Regulation "D") 96,770 shares of 8% preferred
(par $2) and 96,770 shares of common stock (par

expenses.

1

mon

Underwriter—None.

Zenith Uranium &
Mining Corp.
' ■
July 12 (letter of notification) 300,000 shares of
common

stock

(letter of notification) 2,990,000 shares of com¬
Price—At par (10 cents per share). Pro¬
ceeds—For exploration and development costs.
Office
—358 S. 3rd St. East, Salt Lake City, Utah. Underwriter
—Western Securities Corp., same city.
v

Oct.

to class A and for class B stockholders of
record Aug. 29
on the basis of
$500 of debentures for each 50 shares a£r
stock held; rights to
expire on Nov. 30. Price—At par.
Proceeds—To reduce bank loans and for
development of
company's wells in Weston County, Wyo. Office —100
State St., Albany 7, N. Y.

Francisco, Calif.

Thunderbird Uranium Co., Reno, Nev.
mon

Proceeds—For

Office—1818 Beverly Way, Las
Vegas, Nev.
—First Western Securities, same city.

Texas; and Chas. B. White & Co., Houston, Texas.

45

share.

Proceeds—For exploration

and development ex¬
bldg., Salt Lake City,
Utah. Underwriter—P. G. Christopulos & Co., same city.
penses.

Office—323

Newhouse

Wyoming Uranium Corp., Salt Lake City, Utah
(letter of notification) 9,166,667 shares of com¬
mon
stock (par 1 cent).
Price—Three cents per share.
Proceeds—For exploration and development expenses.
Underwriter—James E. Reed Co., Salt Lake City, Utah.
Aug. 23

Wytex Oil Corp.
(letter of notification) $290,000 of 10-year 5%

Sept. 17

sinking fund debentures (with warrants) being offered

*r-^^

ihviv'te*nr

JJ"•.

is

i

•His#'1

Chicago & Eastern Illinois RR.
Sept. 21

company filed an application with the ICC for
authority to issue $15,350,000 of 5% income debentures
due Jan. 1, 2054, to be offered in exchange, par for* par,

for the outstanding

383,751 shares of class A stock (par

$40).
★

Chicago, Milwaukee, St. Paul & Pac. RR. (12/6)
by the company up to noon (CST«
Dec. 6 at Room 744, Union Station Building, Chicago

Bids will be received
on

6, 111., for the purchase from it of $7,200,000 equipment

Continued

on

page 46

T"

46

(2182)

The Commercial and Financial
Chronicle

Thursday, November 25,1954

...

.*sr~

Continued

Co., Harriman Ripley & Co. Inc. and Union Securities
Corp. (jointly); Morgan Stanley & Co. Bids—Expected

from page 45

trust certificates, series TT, dated Nov.

■

1, 1954, and due

semi-annually to and including Nov. 1, 1969. Probable
bidders: Halsey, Stuart & Co. Inc.; Salomon Bros. &

•

Chicago, Rock Island & Pacific RR.
Oct. 28 it Was reported that this company may
possibly
announce a refunding operation soon which will elimin¬
ate its preferred stock.

writers

Inc.

•

additional

shares

of

stockholders planned
derwriter—None.

on

nof

toexceed

authorizing 920,822

.

additional block of 75-cent cumu¬
preferred stock (par $1),
expected
to gross around
$250,000. Proceeds—For expansion and
acquisitions. Underwriter—Probably Pacific Coast Se¬
curities Co., San
Francisco, Calif.
,*
>

ir Marine Midland Corp., Buffalo, N. Y.
17 it was announced
company plans to offer to its
stockholders the right to subscribe for
approxi¬
mately 400,000 shares of commulative convertible pre¬
ferred

stock

(par

$50).

Proceeds

—

For

investment

additional capital stock of subsidiary banks and for
corporate

Underwriters

purposes.

—

Union

in

other

vote

Missouri
Nov. 8 it

on

Servomechanisms,
Nov. 15 it

Natural

Co.

Gas

tration—Expected

McDowell,

announced

construction

company

Underwriter—To

program.

be

deter¬

mined

by competitive bidding. Probable bidders: Hal¬
sey, Stuart & Co. Inc.; Morgan Stanley & Co.; Stone &
Webster Securities Corp.; The First Boston
Corp. Bids
—Expected in January.

•

stock

common

on

Nov. 6 it
on

Products
was

approving

Co.,

Plymouth,

com¬

Nov.

.sell

Mich.

announced stockholders will vote Dec.

'

1

♦

''if'

''

**"•

,

week of Nov. 22.

111.
RR.

Nevada

Power Co.
Nov. 12i il_was announced
company plans to issue addi¬
tional common stock
early next year. Underwriters—
Hornblowrf & Weeks, William R. Staats & Co.
and First
California Co.

(12/9)

X/

announced

was

company plans to issue and
mortgage bonds, series F, due
Proceeds—To purchase properties from Connecti¬

•

of first

Transcontinental Gas

Nov.
"

24|Tom

year's

Underwriter—To be determined by

Line Corp.'
'
0
Walker, President, announced that

P.

construction

program and replacement
made this year will require

of

/V
next

bank

borrowings
competitive bidding. Probable bidders: Halsey, Stuart
financing during
Co. Inc.; Equitable Securities Corp:; Kuhn, Loeb & '1955 of [ about $85,000,000.
Underwriters^-Wtritie, Weld
& Co. and Stone
.Webster Securities
Co.; The First Boston. Corp;; Merrill Lynch, Pierce, FenCorp., both of
; New.
ner &r Beane; Kidder, Peabody & Co. and White Weld
-,v,
& Co- (jointly). Bids—Expected to be received on Jan.
Unioti Trust Cd. Of
Maryand (1/4) •
j
Nov. 11 Tt was announced bank
18, 1955.
"plans to offer its stock'■-i holders |l0U,000
additional shares of capital stock
.(pfer
&

'

.

■
,

Southern

Co.

it

15

cut River Power Co.

an

freight
loading equipment. Financing—Not imminent;.0:"
,

Chicago,

$25,000,000

1985.

21

authorized issue, x>f 100,000 shares of
preferred stock j(par $50.) and on increasing the author
ized common stock (par
$5> irem 300,000 shares to 1,-000,000 shares. Business—Company manufactures
car

k

*;•

was

Missouri Pacific

'

Evans

"*

Texas & Pacific
purchase from it of $4,575,000 equipment trust certifi-;« raM"« Ry. v**/ o;
(12/8)
j
(part of a new authorized issue of $8,550,000).
JN0V* 11 " was reported company plans to receive bids
on Dec. B for the
Probable bidders: Halsey, Stuart & Co. Inc.; Salomon
purchase from it of $1,350,000 of
equip¬
ment trust certificates.
Bros. & Hutzler; Kidder, Peabody & Co.; Blair & Co.
Probable bidders:
Haisey, Stu¬
art & Co.
Inc.; Salomon Bros. & Hutzler;
Incorporated.
Kidder, Pea¬
body & Co.; Blair & Co.
New England Power Co.
Incorporated; R. W. Pressprifcb
(1/18)
&

additional
a l-for-20 basis.
Proceeds—
Underwriter—None.

For construction program.

1

cates

218,737

shares of

(12/13-17)

Bids will be received by this company on Dec. 9 for the

Duke Power Co.
/Nov. 10 company announced it
plans to offer to its
mon
stockholders a
maximum
of

Inc.

was

reported company plans to issue and sell
$2,000,000 of 5% convertible debentures due 1966.Un¬
derwriter—Van Alstyne, Noel &
Co., New York. Regis¬

financing Dec. 29.

for

was

Kidder#

Peabody & Co.; Blair & Co., Incorporated.

Securities

Corp.; The First Boston Corp.; Schoellkopf, Hutton &
Pomeroy; Granbery, Marache & Co.
Meeting — Stock¬
holders to

an

convertible

Seaboard Air Line RR. (11/30)
Bids Will be received
by the company up to noon (EST)
Nok 30 at the office of Willkie Owen Farr
Gallagher
& Walton, 15 Broad
St., New York 5, N. Y., for the pur¬
chase
from it of $5,010,000 equipment trust certificates,
series O, to be dated Dec.
1, 1954, and to mature in 30
equal semi-annual instalments. Probable
biddersr Hal¬
sey, Stuart & Co. Inc.; Salomon Bros. &
Hutzler;

reported early registration of about 110,000 shares of common stock is expected.
Price—May be
around $8 per share.
Underwriter—Straus, Blosser &

it

issue- and sell

on

plans to issue and
sell $40,000,000 of 20-year first
mortgage bonds. Pro¬
ceeds—To redeem $35,000,000 3%% bonds, due
1983, and

„

to

Feb. 15, 1955.

Nov.

and^ sale

„

Savage Industries, Inc., Phoenix, Ariz.-? Aug. 9 it was announced company plans later this
y^ar

common

$6~000,000

—

.

Office—Room 717, 141 Broadway, New York
6, N. Y.*-

Duke Power Co.
10

con¬

struction

program.
Underwriters
Morgan Stanley &
Co., Drexel & Co. and Glore, Forgan & Co.
Offering—
Expected in January, 1955.
..■■"■
'
■
!•

Shields & Co.

on

17c it

was announced
company plans to is$ue and
250,000 shares of cumulative preferred stock
(par
$100). Proceeds — To reduce bank loans and for

sell

of 100,000 shares to service station owners and
operators.

convertible debenture bonds
in connection with the acquisition of Uranium Mines of
America, Inc. stock. Public offering of $2,000,000 bonds
expected early in 1955. Underwriter — Tellier & Co.,
Jersey City, N. J.
Nov.

ir Public Service Electric & Gas Co.
Nov.

by

lative

capital stock for an offering to
for 1955 on a l-for-8 basis. Un¬

Consolidated Uranium Mines, Inc.
July 23 stockholders authorized the issuance
of

determined

Majestic Auto Club, Inc.
Aug. 25 it was announced company plans to offer 500,000 shares (par five cents) to the motorist and
general
public shortly after completion of the current offering

Consolidated Natural Gas Co.
will vote

and

be received

Sept. 16 J. French Robinson, President, announced that
2

be

Corp. (jointly); White, Weld
(jointly); Harriman Ripley &
Co., Inc.; Equitable Securities Corp. Bids—Expected to

bidding. Probable bidders: Halsey, Stuart & Co.
Inc.; Glore, Forgan & Co.; The First Boston Corp. Bids
—Expected to be received on Jan. 11.

Dec.

—

and The First Boston

& Co.

tive

on

To

competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; Lehman
Brothers
and
Bear, Stearns & Co. (jointly); Kuhn,
Loeb & Co., Salomon Bros. & Hutzler and Union Secur¬
ities Corp. (jointly); Glore, Forgan &
Co.; Blyth & Co.,

Commonwealth Edison Co.

stockholders

.

Kansas City Power &

Light Co. (2/15)
Sept. 15 it was announced that company plans to sell
$16,000,000 first mortgage bonds due 1985. Proceeds—
To repay bank loans and for new construction. Under¬

Hutzler.

(1/11)
Nov. 5, William Gale,
Chairman, disclosd that this com¬
pany plans to file a registration statement with the SEC
in December covering a proposed issue of
long-term,
sinking fund debentures (the exact amount of \yhich has
not yet been determined).
Proceeds—For construction
program.
Underwriter—To be determined by competi¬

Underwriter—To be determined by
competitive bidding.
bidders: Harriman
Ripley & Co. Inc. and
Central Republic Co. Inc.
(jointly); Smith, Barney &
Co.; Kuhn, Loeb & Co.; Glore, Forgan & Co.
Offering—
Expected in first half of 1955.
Probable

Dec. 15.

on

V*.

"■/# First National Bank of Colorado
Springs
<•
Nqw ^stockholders Were given the right to,subscribe
for 12,500 additional shares
oLcapitakstock cm a.l-for-4
-

—^besiSy. Price
*

&

Co., Colorado

& Co. and Boettcher

-

UAiVAA

16

.

-

—

about 69%

owns

JL

ofpresenb

^

;

y

'

•

were

offered

*

"ceeds—To

Underwriter ;
7

temporary
•
26,000 additional shares of capital- stock'
—None.
•'
(par $12.50) on
a
l-for-2 basis;- rights tor expire1 on
Dec. 7. Price—$20
• New
York, Chicago & St. Louis mc.
per share. "Underwriter—Blatf &"Co.
Incorporated, New " Nov. 16 it was announced company
York.

General Homes, Inc.,
Nov. 17 ft was announced
sell 300,000 shares of

Huntington Station, N. Y.
company plans to issue and
stock. Price—$5 per share.

common

Pr6ceedS-4For working capital. Business—Prefabricated
houses.

repay

Underwriter—S.

D.

Fuller

Offering—Expected in December.

&

an

Co., New York.

increase

in

the

of

income
outstanding 334,166 shares of 6%

Underwriters—To be determined

ferred stock.
1

General Telephone Co. of the
Southwest

Aug. 25 stockholders approved

$36,000,000

ceeds—To redeem

petitive bidding.
Co. Inc.; Blyth &
(jointly); Smith,
Kuhn, Loeb & Co.

by

thorized preferred stock
(par $20) from 400,000 to 700,000 shares and in the
common
stock from 500,000 to
1,000,000 shares.
Underwriters—Paine, Webber, Jackson
& Curtis and Stone & Webster

(par $10)

Securities Corp.

shares

Gulf, Moblie & Ohio RR.
Aug. 23 it was reported

Dec.

23.

Drexel

the basis
of

as

Price—To

increase

company may consider the
issuance of about
$25,000,000 bonds later this year. Pro¬
ceeds—To refund first
refunding mortgage 4s and 3%s
due 1975 and
1969, respectively; collateral trust 33As
due 1968; and New Orleans
Great Northern 5s due 1983.
Underwriter—To be determined by
competitive bid¬
ding.
Probable bidders:
Halsey, Stuart & Co. Inc.;
Kuhn, Loeb & Co., Blyth & Co., Inc. and Salomon
Bros.
& Hutzler
(jointly); The First Boston Corp.; Shields
& Co.

on

held

surplus
&

100,000 shares of
of

Nov.
be

and

new

26,

named

capital

Co., ^Philadelphia,

Pierce, Fenner

&

Beane

and

new

1954;
on

share for

rights
Dec.

accounts.

Pa.;

common

and

1.

to

pre¬
.

Penn-Texas

Bank

above.]
—May be Carl M. Loeb, Rhoades & Co.

Underwriter

.

Sept. 9 S. B. Harris, Jr.,
President, stated that prelimin¬
financing has been arranged to be followed
by a
public offering after which this
corporation
ary

distribute a part of its
holdings of
stock to its stockholders.
Illinois Central RR.
Oct. 12 it was
reported

plans do

Holly Uranium Corp.

Sept.

Merrill

the

Lynch,
Smith Barney & Co., of

(12/15)
company plans to issue and sell

$18,000,000 of sinking fund debentures due 1979. Pro¬
ceeds—Together with treasury funds to redeem
372,914
shares of
outstanding preferred stock (par $50). Under¬
writer—To be determined
by competitive bidding. Prob¬
able bidders:
Halsey, Stuart & Co. Inc.; Kuhn, Loeb &

Corp.




Underwriter—To be determined by competi¬

(jointly); White, Weld & Co.; Shields & Co.
Public

sell

Service
was

Co.

of Oklahoma

reported that company plans to issue and

100,000 shares of new preferred stock

26 of

7

Lester

company

S.

per

share.

(par $100).

a

of

merger with

Commercial

Albany, it is planned

to
on

(par

Underwriter—Blyth

& Co.,

Uranium, Inc., Kellogg, Ida.
Harrison, President, announced that

contemplates

company's current drilling

pro¬
,

Virginia Electric
Nov. 1 it

&

<

Power Co.

was

reported company
may issue and sell
000,000 to $25,000,000 of first
mortgage bonds

some

next

$20,time

Spring. Underwriter—To be determined
by com¬
petitive bidding. Probable
bidders: Halsey, Stuart &
Co.
Inc.; Union Securities
Corp.; Stone & Webster Securities
Corp.; Kuhn, Loeb & Co.; Salomon
Bros. &

White, Weld

Hutzler;

& Co.

it Virginia Telephone &
Telegraph Co.
Nov.
22

dents
stock.

it

of

was

(12/14-15)

reported company plans to
offer to resi¬

Virginia 35,000 additional shares
Price—About $15.25 per share.

additions and improvements.

tive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Equitable Securities Corp.: Salomon Bros. & Hutz¬
ler; The First Boston Corp.; Blyth & Co., Inc., Kidder,
Peabody & Co. and Stone & Webster Securities Corp.
•

Nov.

gram.

subsidiary and the remainder would be

Sept. 2 it was reported company may sell between $20,000,000 and $25,000,000 of first mortgage bonds in Janu¬
ary., Proceeds—To repay bank loans and for new con¬

Nov. 11 it

announced

on

Oregon and Bank

(Ore.) (12/2Y
that following approval
by

obtaining funds to initiate
its uranium
mining operations in Utah by the sale to the
public of its unissued
treasury stock. This financing will
follow completion of the

Public Service Co. of Oklahoma

struction.

of

Utah & Idaho

Proceeds—To

Underwriters—

used to develop proven oil reserves,
including an ex¬
panded drilling program. Offering—No definite decision
yet made.

Holly Corp., New York.

was

$20). Price—$50
Inc., New-York.

14
on

offering. Proceeds — Of the approximately
$3,000,000 which would be obtained, about $1,000,000 will
be used for drilling, exploration and additional
pur¬
chases under the corporation's uranium
program; an¬
other $1,000,000 will be used to finance accounts rea

it

offer stockholders of
record Dec. 2 right to
subscribe
or before Dec. 24
for 48,000 shares of
capital stock

capital stock (par $10) was increased
1,000,000 shares, of which about 220,000 shares are
to be publicly offered.
Price — From 15% to 25%
below the price on the New York Stock
Exchange at

of

8

stockholders

18 authorized

ceivable

1

.

U. S. National Bank of
Portland

by

«

Kidder,

ProbaWe

Lynch, Pierce, FenPeabody & Co. (jointlyj;

Goldman, Sachs .& Co.; The First Boston
Corp.; Lehman
Bids—Expected to be received early in Janu¬

Nov.

the time of

Hilton Hotels Corp.
Oct. 27, Conrad N.
Hilton, President, announced that
holders of stock of Hotels
Statler Co., Inc., will be ac¬
corded rights to purchase
Hilton securities. Proceeds—
To pay in part for
purchase of Hotels Statler
Co., Inc.
properties.
[See also Statler Hotels Delaware
Corp.
under "Securities in
Registration"

and

ary.

New York.

Oct.

Beane

Brothers.

stock

each

.&

ner

com-

expire

outstanding. Underwriter

be determined, by competitive
bidding.
bidders; Blyth &
Co.;Inc.; Merrill

Probable bidders: Halsey, Stuart &
Co., Inc. and Union Securities Corp.
Barney •& Co.; White, Weld & Co.;
Bids—Tentatively expected on Jan. 11.

the right to subscribe to

pectric' Bond & Share Co. filed with the SBC
.application to sell 170,000 shares of
common stock of
United G3$ Corp; in order to
reduce its holdings to less
than 10% of United Gas stock

j __To.

Pennsylvania Company for Banking and Trusts,
Philadelphia, Pa. (12/1)
Aug. 24 it was announced stockholders will be offered

au¬

Nov. .22

an

m /111

P^^ssue^ana
debentures due 1990. " Pro¬

'

sell

V

w—

American Telephone

basis.

Fort tiqck National
Bank,' Sea ford, N. Y.
Nov. 17. Stockholders of record
-Nov.

of

common

Proceeds—For

Underwriter—Scott,. Hor¬
&
Mason, Inc., Lynchburg, Va.
Western Pacific RR. Co.
Sept. 8, it was announced that
directors have approved
the issue and sale
about Jan. 1, 1955 of
$7,000,000 of
first mortgage
bonds, series B. Proceeds
ner

»

•

—

To

re¬
imburse company for capital
expenditures already
made
and for future
improvements.
Underwriters—May be de¬
termined by competitive
bidding. Probable bidders: Hal¬
sey, Stuart & Co. Inc.; Union
Securities Corp. and
Glore,
Forgan & Co. (jointly);
Kidder, Peabody & Co. and
Blyth & Co., Inc.
(jointly); Lehman Brothers and
Stearns & Co.
Bear,

(jointly).

Volume 180

Number 5380

1

The Commercial and Financial

...

UTILITIES

CHEMICALS,

declared .a

PLASTICS

holders ol

The

Board

of

Directors

declared

of the

dividend of 58 cents

a

shore

per

on

3, 1955 to stockholders of

tn»ry

>

Vice President &

r

Treasurer

>

November 19

W

1954

m O

D U

"f

■

United States Lines

DIVIDEND

C T •

Directors declared a

25

Common

Stock

ROGER HACKNEY. Treasurer

7% SECOND PREFERRED STOCK

regular quarterly dividend for
current quarter of $1.75 per share,
payable January 1, 1955, to holders

,

of record

KENNECOTT COPPER

of business

the close
December 3, 1954.

7

at

CORPORATION

DIVIDEND

161 East 42d Street, New

COMMON STOCK

'AMERICAN

Vt

in

1954,

and

An

DIVIDEND

of

oI 25tf

DIVIDEND

share

will

be paid

December

EXTRA

60£

22,

of business

H. T.

a

to

1954

One Broadway, New

t

the

1955, to
of business on December
regular quarterly dividend

5,

clo.;e

share

the

share

the close

December 8, 1954.

series

A $50

ihare,

C.

liberty

A

Stock

November 23rd,

Mining

Newmont

A dividend of fifteen cents

mon

the Com¬

20;

Stock of this Corpora¬
was

December 15, 1954, to
•

r

»

„

,

„

p

bhreveport,

f

ord at the close of business

phillies

Board oflDirectors has

declared

this date

a^ivjpend of thirty-seven and

$.

one-half

i

Corporation,
payable Jan&ry 3, 1955, to stock¬
holders of record at the close of busi¬

centjfr (3734^) per share on

the Common

ness

on

Stock of the

Dee$nber 10, 1954.

;-M'

B. H. WlNHAH

22^,1954

Secretary

-4—

J.

C.I.T. FINANCIAL

NO. 29

DIVIDEND

William G. Holman

No. 267 ol

declared by the Board
of Directors out

of past earnings,

-

payable
1

Dividend

on

The

declared

Two Rector St.,

Common Stock

on

Dec. 10, 1954.

the Common Stock,

payable January 3, 1955 to

f. dunning

*

on

December 3, 1954.

Executive

THE

Vice-President and Secretary

YALE & TOWNE MFG. CO.

Cash dividends paid in every year

J. E. IVINS,

(

close of business

share has been

stockholders of record

New York 6, N. Y.

ot the

regular quarterly dividend

of 35c per

since 1899

Secretary.

'

Dividend

The Board of Directors
a

has "

dividend, subject to the

28, 1954, to shareholders of record
at the close of business November

UNITED FRUIT

1954. The dividend will be
payable in shares of United Gas
Corporation Common Stock at the
rate
of 2.2 shares for each 100
shares of Electric Bond and Share

26,

COMPANY
Southern
222nd

Stock. No scrip
representing fractional shares of
United Gas Corporation Common

Company Common

Consecutive

per

seventy-five cents

share an the capital stock of

this Company

has been declared

payable January 14,1955, to stock¬
holders of record Dec. 10,1954.

B. M. Betsch,

EMERY N. LEONARD

Common Stock

sha|e in cash has
C.'ljT. Financial
Corporation, payable December 22,1954,Jo stockholders
of record at the close of business Decembe^lO, 1954. The
transfer books will not close. Checks will fie mailed.

ORIGINAL PREFERRED STOCK
DIVIDEND NO. 182

CUMULATIVE PREFERRED STOCK

4.32% SERIES
DIVIDEND NO. 31

Consecutive

c.^john kuhn,

Treasurer.

share

50 cents per

-

quarterly dividend of $0.50 per share in|eash has been
declared on the Common Stock of C. l.jjT. Financial
Corporation, payable January 1, 1955, to jstockholders of
record at the close of business December?10, 1954. The
transfer books will not close. Checks will be mailed.
MV

The Board of Directors has

of the

A

27

Common

cents

per

share on Cumu¬
Stock, 4.32%

Series.

The

above

dividends

stockholders of record Decem¬
ber 5. Checks will be

cent

share) has been declared on the outstanding
Stock of the Company, payable December 15,

November 19,

1954

December 3, 1954.
W. J. Thompson, Treasurer

mailed

from the Company's office in
Los Angeles, December 31.

per

1954, to stockholders of record

are

payable December 31, 1954 to

Baltimore

quarterly dividend of three and three-quarters per

(371/2 cents

Orig¬

lative Preferred

Quarterly Dividend

The Finance Company of America
at

on

inal Preferred Stock;

135th

Common Stock

■

DIVIDENDS

authorized the payment

A

a

Company

following quarterly dividends:

the Common Stock of

on

California

Secretary and Treasurer
Boston, Mass., Nov. 15, 1954

dividend of $0.25 eents per

%

Edison

Quarterly Dividend

shareholders.

A dividend of

CORPORATION

.

on

stockholders of record

T reasurer

November 18, 1954.




,

Company

Secretary and Treasurer

Nevember 24, 1954.

.

Transmission

Company's dividend agent
to handle fractional share equiva¬
lents for the shareholders.

Dividend

dividend

1954.

per snare was

for the

been declared on

On Nov. 22, 1954,

at the

29, 1954.

GOODWIN, Treasurer

The Company proposes to arrange

An extra

of record

stockholders

Jan. 3, 1955, to

Stock will be issued to

Extra

50< PER SHARE

Tennessee Gas

-

December 17, 1954.

louisiana

Dividend Notice
The

November

■*

DECLARES 267th DIVIDEND

approval of the • Securities and
Exchange Commission, on
the
Common Stock", payable December

Americans NSf ciqar

?

YALE &TOWNE

on

declared

I
>

November 30,1954.

fifty cents (50#)

share on: its com¬
mon
stock, payable December
31, 1954, to stockholders of rec¬
Per

I

Philadelphia, Pa.

on

Thirty-seven and one-half Cents

i

TREASURER

November 19, 1954

GAS

CORPORATION

1

A.WEDEMEYER

,

UNITED

m

Seventy-

York, N. Y., November 18,

New

COMPANY

'

I:

Corporation
regular quarterly dividend of

holders of record Nov. 30,

1954. Checks will be mailed.

to

1954,

E.

electric bond and share

share-

to

at

November 23rd, 1954.

declared payable

1954,

ROBERT C. SULUYAN, Secretary

($.75) per share on the Common
this Company has been declared

close of business November

Liberty
declared

WILLIAM T. SMITH, Treasurer
New York, N. Y.,

tion

a

1954, the Directors of
Corporation declared a
regular dividend (Number 106) bf
per
share on the 2,658,230 shares of its Capital
Stock now outstanding, payable December",
15th, 1954 and an extra dividend (Number
107) of 50tf per share payable January 5tli,
1955, both payable to stockholders of record
at the close of business December 1st, 1954..
On

17,

the Treasurer's Office, No. 165
Broadway, New York 6, N. Y., on December

payable

(37^2^)

107

of

of

DIVIDEND

QUARTERLY

five Cents

November 23, 1954

Corporation

Dividends No. 106 and

on

of business

DIVIDEND NO. 148

Farmingdale, New York

McGREW

Newroonf Mining
.

(150 per«hare

/

SOUTHERN PACIFIC COMPANY

CORPORATION

Products

."

December

on

stockholders of record at the close

PRODUCTS

The Board of Directors of

mmmmrnm ^|

TV

Copper Corporation, pay¬

able

'

\

were

D.

a

today by

13,

par

&f><aared, payable on December
;i, 1S54 to sjbpijkholders of record at the
close of business on December 3, 1954.

McMeekiq, Treasurer

($2.25)

Cents

Kennecoft

November 23, 1954.

.

on
value preferred stock
.n
the
amount of sixty-two and one-half
jents per share, and also the regular quar¬
terly
dividend on the series B $50 par
alue
preferred stock in the amount of
;ixty-eight
three-quarters cents per
.The

954.

Twenty-five

share has been declared

Secretary

York 4, N. Y.

Secretary

;

and

stock of
thirtypayable
stockholders of record

_

~k:

A cash distribution of Two Dollars

3,

R. O. GILBERT

dividend on the common

a

Tanuary

concurrently on

holders of record at

1954, to holders of Common
Stock of record November 26, 1954, who
on
that date hold regularly issued Com¬
mon Stock ($1.00 par) of this Company.
CHAS. F. BRADLEY, Secretary

December

of business

close

1951

corporation in the amount of
ive cents per share was declared,

CASH

a

Colorado Fuel and Iron Corporation
New York, N. Y. on November 22,

-,he

QUARTERLY

CASH

of Directors

Board

the

of

meeting

a

leld

44th Dividend

-

the

December 10,

Dividend Notice

j'
jf The

:

CORPORATION

IRON

share payable Decem¬
23, 1954, to holders of record at

ber

The Board of Directors has

METALS,INC.
REGULAR

authorized the

payment of a dividend of thirty-seven and
one-half cents ($.37V2) per share payable

COLORADO FUEL AND

THE

York, N.Y.

November 19, 1954

12>2 cents per

MACHINE AND

A

Broadway, New York 4, N. Y.

The
the

29,jjj954.

November

Secretary and Treasurer

the close of busi¬

at

December 3, 1954.

ness

Company

dividend
of 75c per shar$<on the Common Stock, and,
In addition thereto, a year-end dividend of
$1.25 on the COmmon Stock, both payable
December 9,i4954, to holders of record

The Board of

December

on

C.EARLE MORAN

current

holders of record

Corporation

'

regular quarterly dividend for
quarter of $1.12)2 per
share, payable January 1, 1955, to

Johns-Manville

Secretary

close of business

-3,1954.

The
the

D. W JACK

.

payable December 23, 1954, to
stockholders of record at the

^

JOHK1-MANVIIU

has today declared a divi¬
Seventy-five Cents ($.75)

j)er share on its capital stock of
the par value of $50 per share,

N.Y.

4% % PREFERRED STOCK, SERIES A

Paul E. Shroads

December 1, 1954.

Mining Com¬

dend of

THE Boardthe Directors has this day
of following dividends:
declared

26,1954.

McCAULEY, Secretary.

P.

record at the dose of business

pany

CORPORATION OF AMERICA
1180 Madison Avenue, New York 16,

payable December 13, 1954, tostock holders of record November

at the close

1955,

J.
,

a quarterly dividend of
seventy-five cents per share on
the capital stock, which will be

declared

November

433/4

to stockholders of record
of business December 8, 1954.
1,

at a

16, 1954,

meeting on November

24, 1954 a quarterly dividend
cents per share on the Preferred Stock
ind a dividend of 40 cents per share on the
Oommon' Stock were declared, payable January

Company, payable Jan-

CELANESE

Dividend
The Board of Directors

of

Directors

of

Board

Anaconda Copper

100th Consecutive

N. Y.

New York,

Plaza,

Rockefeller

On

of

the Common Stock

November 24, 1954

The

Treasurer

COMPANY

W. HELME

GEORGE

today
9

\

SNYDER,

F.

JOHN

-

186*

NO.

DIVIDEND

10, 1954, to stock¬
record on November 19, 1954.

December

*

NOTICE

AnacondA

TEXTILES

quarterly dividend of $.25 per share on
the common stock of the Corporation,
payable

DIVIDEND

NOTICES

CHEMICALS]

INC.

Directors has

Board of

The

COMPANY

DIVIDEND

NOTICES

DIVIDEND

PLASTICS* :."V.

DURdZ
&

NOTICES

47

Notice

Dividend

a

■...

(2183)

DIVIDEND

NOTICES

DIVIDEND

NOTICES

DIVIDEND

Chronicle

P. C.

November

HALE,

19,1934

Treasurer

t

Chronicle

The Commercial and Financial
48

Ttiursday, November25,1954

...

(2184)
administered

who

BUSINESS BUZZ

ment

of

Nation*! Capital

from the

was

appreciate Mr. Appleby
early in"
the game to appreciate and pass
on
to Mr.
Wallace, Mr. Ap¬
because the latter came

•.

pleby's conviction that Mr. Wal¬
lace was just what the United

A
Villi
JTXi rtv Mm t/w

/,

(

It

to

came

BeTund-tbe-Sceae Interpretation!

Depart¬

often said here that Mr. Wallace

^

•

•

•

the

Agriculture.

States of America needed for

a

President.

(This column is intended to re¬

devouring

-around

real

hopeful legislative babies
of the left-wing crowd, is quite
1955

velt and Truman. For two years

vania Avenue—for the

first time

had

to

Security Traders Association of
New
York,
annual
business

of health insurance.

Bankers Club.

amendment

by

f

the

House

Republicans

Harris Ellsworth of Oregon,

All four are

and

in

conservatives

southern

committee,
The

p

the

on

Smith

area

Ray

is

expected

is

It

Sam Rayburn, the
Speaker, will see to it that
Mr. Madden will have the com¬

that

Rep.

a

|

of

intellectually

will

whom

and

j

be

politically

on

However, it
to

takes a vote of 7

5, in other words a

majority,,

port out a rule to make possible
the consideration by the House
of

any

tion.

major piece of legisla¬
So where
the
issue
is

straight radicalisum, the Rules
kill a

tax

pro¬

Democrats have de¬
termined
definitely that they
want to hurt this, probably do¬
ing away with the dividend
credit and perhaps also boost¬
ing the exemptions.
gram.

if

and

as

the

leadership

House

triggers

Committee, published reports to
the contrary notwithstanding.
In the Finance Committee of

"liberalism."

to take affirmative action to re¬

-

the

Senate

and

particularly in
its able prospective chairman,
Senator Harry F. Byrd (D., Va.),
the

Administration

doubtable
and

has

a

Southern conservatives may get

motor

their

esting situation will develop if
the Republicans revert the 1954
pattern on "liberal" proposals
of the

President.

Suppose, for instance,

a

House

to

sions

when

1956,

until

they will again be in the same
position on the eve of
Presidential campaign to vote

tactical
a

their pretty forms
T-H

The

most

the

severe

of

test

survival that has been presented
1947.

birth

the

of

the

'

in

law

'

'

be

expected

clear» the

to

debilitating amend¬
ments. The primary barriers to
restoring the Wagner Act's
blessings to the walking dele¬
gates will rest with the Rules
or

way

and

Committees

Labor

of

the

Rep.

he

is

a

stout supporter

of

T-H.
j

However,

berals"

are

maneuver

Barden

Democratic "libabout

talking
to

knock

by splitting

off

of

The

a

Mr.

the House

a

num¬

although not

committee busi¬

work

there

New York Security

hower

Dealers As¬

sociation 29th Annual Dinner at
the Biltmore Hotel.

May 8-10, 1955
National

cial

(New York City)

Federation

Analysts

of

Societies

Finan¬

at

the

11-14,

Sept.

1955

Is¬

(Mackinac

land, Mich.)
National

Security Traders Asso¬

ciation annual convention.

do.

is

is

chance

(New York, N. Y.)

11, 1955

Mar,

Joins

If this maneuver succeeds and

Barden

Denver

as

overwhelming as before but in¬
being committee chair¬
men, members became subcom¬
mittee chairman with just as
to

the

at

Hotel Commodore.

just

was

Party

Club.

stead of

shunted

aside,
than

better

a

than

-

even

(especially since Eisen¬
backs some amorphous

bilitation

of

of

Committee

that

T-H)

the

would

de¬

Reynolds Staff

(Special to The Financial Chronicle)

SAN

Calif.

FRANCISCO,

Leonard

Hirschman

R.

has

—

be¬

connected with Reynolds

come

8c

Co., 425 Montgomery Street.

Taft-Hartley

Act will be enacted.

The Rules

then

be

With Wyatt, Neal

the

only possible block against this

&

(Special to The Financial Chronicle)

ATLANTA, Ga.—Donald M. Tais now with Wyatt, Neal 8c

development.

tem

Appleby Is Old Washington
Hand

Waggoner, First National Bank
Building.
;
,

Paul

of the House Labor Committee,
and

volume

the

Graham B a r d e n (D.,
is slated to be chairman

un¬

was

by cutting down the

ness.

House.

N. C.)

1947, which

modification

The Senate Labor Committee
can

of

ber of committees

much

act's mild
organized labor

on

combined

were

political science profeessors'
dream of how to improve Con¬

Taft-Hartley

restraints
face

of tax relief.

Severe Test

Faces

Labor

Legislative Reorganiza¬

Act

gress

without

forward

go

amendments

Appleby,

whom

Gov.-

elect Averell Harriman of New
York

named

dector,
hand.

is

as

his

budget di-

old Washington
When Henry Wallace as
an

Secretary of Agriculture was
keeping his thoughts and ob¬
jectives on the higest intellec¬
tual plane, Mr. Appleby came in
substance to become

the fellow

We have available copies of
an

Analysis of

RIVERSIDE CEMENT
CLASS B COMMON STOCK

recently prepared by

THE OVER-THE-COUNTER

»

This

analysis

stock

T0^6

offers

portunity

A copy

Carl Marks

these

FOREIGN

higher rates, and there¬
vulnerability.

from arises the
The

get

Administration

must try

extension

SECURITIES

50 BROAD STREET

through,

an

but this gives the

amendments

as




fury, is that the
Democrats will allow the exten¬
and

sound

and

&

why

this

excellent

op¬

shows
an

for

capital

will be sent

on

gains.

request.

Co. Inc.

tration needs the revenues from

to

for

tion

Denver-Rocky

Bankers

liquor,

to

aid

der the

after much

happen,

to

pected

friend of

a

tobacco, and
vehicles drop back April
on

opportunity

Federal

on

Education

Committees

corporations.:

on

only an informed hunch
Capitol Hill, but what is ex¬

It is

of

Group
Investment
Association Christmas

Cocktail

(D., Pa.)

the unions.
The

Club

Mountain

SPECIAL SITUATIONS SERVICE

committee brings out legislation

provide

cises and

Kelly

22, 1954 (Denver, Colo.)

Bond

re¬

unless extended, and at the
same
time the corporation in¬
come
tax rate
drops back to
47% from 52%. The Adminis¬

to

.

B.

it can do so only
of sacrificing
rates on these ex¬

Hotel Statler.
Dec.

for Mr. Byrd
gentlemen are still

1,

with at least one of
the five new appointees and,
with Rupblicans, have a 7 to 5
majority.
On the other hand, an inter¬
way

Committee

expenses

higher

give the Labor
to
Rep. Augustine

Calif.)

Security-Traders Association of
Christmas Party at

Los Angeles

However, the higher rates of
excise

even

the

then

at

.

ally,

these

possible that the

It is

would

program

the

at

(its full
is the Committee on
and
They
Labor).

conservative.

Committee will probably
bill.

tax

committees

name

Education

Thus, while the Finance Com¬
mittee may stop the "liberal"

Eisenhower
its

is

this, it will have little difficulty
with the House Ways and Means

the broad basis of con¬
versus

vulnerable

the

of

Democratic

This ties the Rules Committee

"Labor"

legal

dividend

1954 act as the

of the

since

Go Over

most

the

Administration

When

Ties Committee

servatism

of

legisla¬

be forgotten.

to

Think Taxes May

fortresses
j

companionable.

6 to 6

is

coalition

a

radical

to

will have

One

the Rules Committee of
84th Congress of five new
all

conservative

a

such

where

roadblock

tion

pany on

members

for
-

vival of the Rules Committee as

new

the

exemptions and
cutting out such reform features

possible the Democrats won't
play and all thought of the re¬

J.

here

the

unless

Republican coali¬
about the only remaining

tion in

Mississippi.

Madden, an individual who is
not disposed to give the CIO
or the other "liberals" any great
trouble.

too.

so,

this committee

on

firm

stand

of Virginia,

Democrat

3

to do

words,

Democratic

ly been attacked by the Left.
The other is Rep. William M.
No.

more

a

Committee

Republicans

and
individual who has repeated¬

Colmer of

President might
if he

oppose

other

In

who will be the chairman,
an

to

Rules

two

Committee into "Education" and

personal

ing

vulnerable

violent
approach. So he might go along
and
ask
Republicans
on
the

both outstanding
first of these is Rep.

W.

Howard

of

case.

The Democrats have

men.

Committing
principle

the

to

himself

tried

at least is con¬

any

a

licious goal, the
find

conservatives by

bat Rep. Brown

to¬

peaceful penetration of this de¬

temperment, except when Eisen¬
hower
legislation is involved,
servative

Committee.

himself

York.

Henry J. Latham of New

be

Rules

Leo Allen of Illi¬
retiring chairman),
J.
Brown
of Ohio,

■Clarence

-

legislation
tough one for the

would

Quarterly Meeting
Whyte's Restaurant.
and

Dec. 17, 1954 (Los Angeles,

of

piece

Dinner

Christmas

annual

ers

I had one whale of a time
parking meter with time stiil on it!"

"Sorry I'm late, gentlemen,

finding a

ance.
a

(New York, N. Y.)

Association of Customers' Brok¬

credit.

Such

annual

Denver

of

Dec. 13, 1954

.

government health insur¬

ward

begin Reps.

(the

and

millions

of

progress many years sooner

get themselves only four mem¬
bers of this committee, the four
nois

on

hundred

some

Club

Bond

meeting at the University Club,

his agenda for
1955. If so, then most likely the
Democrats
will report
it out
with starting appropriation of
definitely

7, 1954 (Denver, Colo.)

Dee.
■

thought it was too patient and
a step toward the ultimate
seduction.
The
President has.
made it clear that this will be

The ratio of "majority", to ;
"minority" on this committee
of 12 is 8 to 4. rWith the loss j
the

pro¬

timid

,

of

Eisenhower

an

the

at

•"'H-4.

and it failed in 1954 pri¬
marily because. the. Democrats

their

express

pending matter.

ideas about any

in

election

and

meeting

gram,

House can

of the

members

the

progress

This

practically that
unless the Rules Committee
blocks off a string of tracks, an
important piece of legislation
can
rarely go through.
The
committee can also determine
whether, and to what extent,
out

works

1954 (New York, N. Y.)

Dec. 3,

gentle financial caresses over a
period of several years to the
ultimate dominance of the field

the House is set up,

The way

Hollywood Beach Hotel.

with

slowly

Investment Bankers Association
Annual
Convention
at
the

would

stop
w bower's "liberal" legislation.
it

i

Republican
no
great
Mr. , Eisen-

with the House, for

stomach

(Hollywood, Fla.)

is health
"reinsurance." Under this
scheme the Federal Government

get its way

decades—to

conservatives

Nov. 28-Dec. 3, 1954

Or another example

of help¬
ing the other end of Pennsyl¬
cent, fulfilling the job

Field

Investment

In

for

direction.

been quies¬

this committee has

views.)

EVENTS

pigeon-holding such a
proposition, but it doesn't fol¬
low that the Republicans would
if Mr. Eisenhower leaned in that
still

gents like Roose¬

the jitters to

would

Committee

Rules

is, of course, the Rules
Committee, the only political
animal that could really give

two

the
stand

Southern conservatives on

This

coincide with

own

COMING

position.

Democrats.

to.

might try
to beat
to this golden pro¬

they

Eisenhower

assumption of
House by the

the

of

control

and may or may not

the "Chronicle's"

and

in

alive again

to come
with the

possibility for the "liberals"
that such a proposal is

being kept up the White House
sleeve as a vote lure for 1956,

«uost

likely

flect the "behind the scene" inter¬
pretation from the nation's Capital

know

of the

some

is a

This

construction.

school

WASHINGTON, D. C. — That
old
monster
that used to go

"liberals"

tack
they

on
can

TEL:

HANOVER 2-0050

SPECIALISTS

NEW YORK 4, N. Y.

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