Full text of Commercial and Financial Chronicle : November 27, 1952, Vol. 176, No. 5172

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

2
U N

national foreign trade convention featured
!TY

'*"r

Reg. U. S Pat. Office

Volume 176

Number 5172

New York 7, N. Y.,

Thursday, November 27, 1952

Price 40 Cents

a

Copy

EDITORIAL

An

As
We See
often heard

so

apparently

was

This much

seems

that the

"just

to

be

Partner, Hayden, Stone & Co., Members, N. Y. S. E.

campaign

a

choices

of them is

one

"crony."

Neither do the appointments appear
political debts. With
any,
exceptions, Mr. Eisenhower has

to have

few,

chosen
real

Believes

been used to
pay

if

with

men

selection

in1 their

to

seems

chosen

"make sense"

fields.
in

a common

very realistic
and

I

sake

and terrifying

I

can

in those years were

record

security values

parable to that they had made prior to taking
up residence on the banks of the Potomac. The
trouble was, however, that Government was be¬
ing conducted by crafty politicians and scheming
reformers, and the business executive was ex¬
pected to conform to their ideas and their modes
of doing business—and when
they did not do so
it was quite possible for their detractors to
get

times

in

\

recent

a

page

part of

as

jV

our

icy

stock

was

valuation

called

as

a

case

30

York

INSIDE

—

the

•

a

stock

at

over

in

before

Second

of

A

the

the

Thursday

the

a

half.

case

In

made

the

rem-

gone to the

effects

of

own

War,

the

Prior

in

an

U, S.

early

individual economies,

on

page

of

the

winthrop w. Aidricb;.

and which had
severely restricting the
commerce

and

of

role of private
greatly reducing

the volume of world trade.

Since World War II, the foreign economic
policy of the?

36

Continued

on

page

33

Eastern

Security

Regional Con¬
Analysts, Inc., New

♦An

address

National

by Mr. Aldrich at the World Trade Dinner of thflK
Foreign Trade Convention, N. Y. City, Nov. 19, 195&

page 3 vividly shows the wealth of infor¬
field, investors, and businessmen which is
"Chronicle" every week throughout the year.
on

securities

Municipal

Pacific Coast &

Municipal

Bonds

Hawaiian Securities

BANK & TRUST

Wires

Bond Department

Dean Witter
14 Wall

COMPANY

Co.

&

Street, New York, N. Y.

<r\

San

Francisco

Los Angeles

•

Boston

•

•

Chicago

Honolulu

Bond

ESTABLISHED

50 BROADWAY

Dept. Teletype: NY 1-708

and 10

NATIONAL BANK

STOCK and BOND

Royalties, Ltd.

Bankers

BROKERAGE SERVICE
and Dealers

to

York

Stock

Exchange

York Curb Exchange

30 Broad St.
Tel. DIgby 4-7800

New York 4
Tele. NY 1-733




Government

in

NEW YORK CITY
^

>

Denver
Spokane

CHASE

NATIONAL
;

BANK

OP THE CITY OF HEW YORK

other Western Cities

Albercon Oil

26, Bishopsgate,
London, E. C. 2

Branches

in India, Pakistan, Ceylon,
Burma, Aden, Kenya, Tanganyika,
Uganda, Zanzibar, and Somali-

£4,562,500

Paid-up

£2,281,250

Reserve

Capital
Capital

Fund

banking

and

description of
exchange business.
every

Trusteeships and Executorships
also

CANADIAN

undertaken

Power Co.
COMMON

DEPARTMENT

Goodbody

&

Co.

Prospectus

Pomeuox Securities

MEMBERS NEW YORK STOCK EXCH.
115

BROADWAY

NEW YORK

1

40

and

other

York Stock Exchange
Principal Exchanges

111 Broadway, N. Y. 6

Exchange Place, New York b, N.Y,

WOrth 4-6000

Teletype tyY 1-702-3

WHiteh&ll 4-8161

request

Members New

NORTH LA SALLE ST.

CHICAGO

on

IRA HAUPT & CO.

Grporahoti.

ESTABLISHED 1891

£3,675,000

The Bank conducts

BONDS & STOCKS

t

Central Maine

Rainbow Oils, Ltd.

Protectorate.

Authorised

CANADIAN

Corporation, Ltd.

Office:

land

Hardy & Co.

the

Kenya Colony and Uganda
Head

for Banks, Brokers

^

Prairie Oil

of INDIA, LIMITED

•

Salt Lake City
Los Angeles

THE

1915

Members of All Principal Exchanges

OF NEW YORK

and Security Exchanges

BOND DEPARTMENT

j. A. H0GLE & CO.

THE NATIONAL CITY BANK

Members of Principal Commodity

30 BROAD ST., N. Y.

New

to

nationalism,

effect

Chemical

New

the

State and

Direct Private

Members

to

HAnover 2-3700

telephone;

Members

which,

tremendous moment!

great de¬
'Thirties on

Government,

Securities

Convention

'!

polls.

effort

in

State and

a

4

of the

enterprise in world

this

39th

glance at the Index

Foreign Trade

periods.

World

nomic

price at which the stock had been

Society

Wf.
foreign economic policy.

sively towards state socialism, man¬
aged currencies, exchange controls,
import
quotas, and other devices
which, taken together, spelled eco-

Kenneth Ward

in

City, November 24, 1952.

importance to

available

York

ever

into two

their

witness and where the claimant

by Mr. Ward
New

a new

National

who have

pression

Continued
of

prominent

nations of the world moved progres¬

summation: "In the opinion of informed
buyers and sell-

address

program,

cannot

we

close tonight has met at

combat

selling for a period of about a year and
dering his; decision the Judge in this

*An

a

second

every-

upon

four times the average

of vital

mation

warns

years the second
World War has divided events in the
field of international economic pol¬

sought to establish the actual value of

ference

ON THE

DEALERS

called

which I

real diplomacy, real
ability and real independence of petty politics to
weld this team that Mr. Eisenhower is
putting
on

.±

eco¬

During these 20

to determine se¬
curity values and I think you will be
interested in the opinion of the court

It will take real
courage,

Continued

ers

day jobs, but there are others, not in
security, business, who are some-

of the Chief Executive.

ear

name¬

&Sg'

problem's

and

history. Twenty years of rule of the affairs of this
country by the Democratic Party will
'
end next January as a result of the
verdict of the largest number of vot¬

a

escape, with a whole
k

the

peace

Administration, be

in

book," whether

-<^i.s time

com-

in

39th

draws to

jungle,

often wonder, like
my
in Zane Grey's

with

the

The

young
the many dramatic
escapes I experi¬
enced from the clutches of the wild
beasts.
Today I find

Washington '•

a

sound, long-range

foundation for

"

pntitlprl
entitled

businessmen who took their turns in

able to leave

selective, and lists relatively

myself

new

decisively win the
cold war on basis of superior productive
capacity and
military power alone, nor can we indefinitely sustain the
endless arms race and grants-in-aid to allies. Outlines
principal world economic problems and concludes these

Grey made the dreadful mistake of writing a
"Ken WutvI in the
Ward
Jungle," and all my
pals kept reminding me of

hnnlr
book

saying,

commonly accepted as a fact during the past two
Administrations, that good businessmen do not
make good government
officials, and certah*4t
is that few if any of the numerous successful

a

under the

Stafrtafiftg like'idMwheVl was^a "youngster »r°b'em$ I?**? M

Naturally, some of them will find themselves
working in an atmosphere that is not altogether
It has become

supplanted by

New York banker

and Zane

way.

familiar to them.

be

nomic recovery must,

ness

Their

practical

a

market will

Contending old efforts toward world

favorable groups and specific issues.

long and impressive records of

achievement

By WINTHROP W. ALDRICH*
Chairman of the Chase National Bank, New York

(2) increased book values; (3) investors' recessionconsciousness; (4) continuing high industrial activity;
(5) stable; commodity prices; (6) Washington Admin¬
istration friendlier to
business, and (7) swelling investible funds. Expects stock
averages to go into new high
ground by February, with more two million-share
days.

President-designate is making for key
Not

a

•

oratory."

clear from the

posts in his Administration.

New Foreign
Economic Policy

Market analyst cites
following factors now making for a
bullish market: (1) liberal dividend and
earning yields;

during the recent campaign

not

Basis For

By KENNETH WARD*

Evidently there is really going to be a change
in
Washington. The "time-for-a-change" argument

Inviting Stock Market!

>

Boston

Teletype NY 1-2708

Telephone: Enterprise

1820
•m

'

*

1

.

The Commercial and Financial Chronicle
2

..

(2014)
"<vrr,

The Security

POSITION and

WE

IN

TRADE

Cleveland Electric Ilium.*

in the investment

Common

&

Rights

participate and give their reasons

Commonwealth Edison*

they to be regarded, as an

are

Rights

etc.

Petroleum

Warren

Pacific Power & Light

With

New York Hanseatic

Corporation

I

tractive

1920

at

Warren Petro¬

5

has

at-

leum

and

level

quate

properties has increased,
at

this

30

still

are

selling

high of 33 reached ear¬

and

year

top of 34%

a

underlying growth,

dividend

the' latest

meeting

MUNROE,

S.

HAROLD

Exchange

Curb

Exchange

Tel.

NEW

REctor

Jr.

for

ended June 30,

-'

-

industry. As.

the fiscal year
1952, rose to $4.80

is

customary

with

share, compared with $3.80 the
previous year. If earnings from
the

now

The

Trading Markets

stock

wholly-owned subsidiary,
Company, are in¬

Natural Gas Co.

•

I-.,

producer,

ton Basin

Handley Hardware Co.

was

area

held in Texas,

Scott, Horner &.
Mason, Inc.
LD 33

Specialists in

VIRGINIA—WEST VIRGINIA
NORTH and SOUTH

and

in

Since

1946

Warren's

oline

RICHMOND, VIRGINIA

sales

1856

Members

Orleans

New

Curb

Exchange

products.

Exchange

ground

Board

Chicago

And

gas¬

300

from

Installations

in

storage

quantities

Inc.

marketing

have

now

these

of under¬
substantial
been

com¬

Trade

pleted and other installations are

Exchange

in progress or are contemplated.
These storage facilities will con¬

of

Cotton

other

lines.

natural

increased

for

facilities

Exchange

Exchange,

Commodity

established

ap¬

the

Cotton

York

many

new

marketing of liquefied
petroleum gas, Warren has con¬
tinued its program for the con¬
struction of underground storage
and the acquisition of additional

H. Hentz & Co.

York

the

gal¬
lons
and
liquefied
petroleum
products from 218 million gallons
to 651
million gallons.
In 1948
the company had 1,899 tank cars
in operation and now has 3,424.
In

New

and

million gallons to 647 million

Telephone 3-9137

New

in

uses

fields

plications

System Teletype: RH 83 & 84

Stock

increasing

different

CRAIGIE&CO,

York

bbls.,

45,500,000

liquefied

their

■F. W.-

New

totaled

petroleum
gases.
There has been a strong growth
trend in
these products due to

MUNICIPAL BONDS

Established

Exchanges

stitute
the
N. Y. Cotton Exchange

Bldg.

GENEVA,

r PITTSBURGH

SWITZERLAND '




situa¬

tion traded on
the New York

Curb

the

of

name

Ex¬

change.

Harold S. Munroe, Jr.

The

company

Pitts¬

is

burgh

.

payable

bank "ag¬

to

gregating $2,000,000 due in equal
installments

annual

a

over

10-

period. According to the com¬

year

annual

pany's

1,
additional

report, on Aug.

borrowed an
on a short-term basis.
This borrowing was necessary to
it

1952,

$2,000,000

permit the carrying of larger in¬
ventories,
to
protect
increased

facilities

production
volume
the

and to

meet

and sales
portion of

a

co^ts of the modernization and

construction
In

below.

mentioned

programs

with

connection

capital structure of the
it

is

114,424,

to

1952 fiscal year are many,

includ¬

operations and seriously

second,

and

output,

that

a

carried

Members

ISO

and

the

to

the

for

proxy

There

-

which

this

at

are

ac¬

statement

operation

other

total
standing:"
*

and

sharply

Financial

supply
for

to

these prod¬

The expanding

uses

and grow¬

ing demand for liquefied petro¬
leum gases in major fields—util¬

aggregated
sales

mark,

had

Equip. Pfd.

Information

Market

Request.

on

which

it

Moreland & Co.

be

may

v".

mounting

raw

an

there

are

ter of

price in the
with

connection

-

'

,1051

ma¬

Branch

13 years our

zation

grounds"for

near

the

future. In

construction

expansion, moderni¬

construction

and

BLOCKS OF

programs

practically completed and our
plants are in the bestphysical
condition in our history."
are

OF SEASONED COMPANIES
IN SOUTHERN CALIFORNIA

and

.

indeed

a

this

they

had

research the company

ing to develop

new

for existing

uses

in

company

403 W. 8th ST. LOS ANGELES •TU-5630

"IDf

& figiili

ation

and

alloys and

new

alloys, and it is

expansion

of

the

jet-

powered and atomic age with its
concomitant

heat

requirements for high

corrosive, resistant

and

\

is endeavor¬

opinion that with the continu¬

my

*

tP

~

raM

m

1" iWH

V)

*

/

.ipN&

.42S

ma¬

terials this company will continue
to grow

In

and

prosper.

fiscal

the

year

ended

June

30, 1952, dividends on the common
stock of this company aggregated

share, duplicating that
previous fiscal year.

share

per

the

was

December

passed

,

country. Through exhaustive

the

•

strong, aggres¬

a

progressive

out¬

growth

as

the corporate scheme of things in

26%

$225,418.00. By 1936
passed the $1,006,000

by- 1942

sive

latest

'
is

HARRY AND MYRON KUNIN

1939, the company has assumed its

rightful place

The

or

MICH.

Office—Bay City, Mich.

the company's annual re¬

program,

in

stock

Penobscot Building

DETROIT 26,

port states, "For the first time in

paid

ap¬

-

expecting some relief in the mat¬

$2.50

family held

Members:

Detroit Stock Exchange<

labor* and

•However,

"

v

Midwest Stock Exchange

other costs was1
important contributing factor,

terial,

the

ing figures which are taken from
the company's latest annual report.
In 1932 the company's net sales

of

demand

Darling

are

.since Jan. 1,1951) for the products

Oct.

capital

,

this

Mills

Brownhoist

Monroe Auto

inflexible retail price (unchanged

of

proximately 65,000 shares,

That

New York 7
Tel. NY 1-1932

Allied Paper

and

reasons

time; although

on

14, 1952, directors and immediate

the

Security Dealers Assn.

L. A.

the ef¬
plant if

said that the squeeze between air

held

was

members of their

of

Y.

Industrial

does not permit delving into

space

meeting

annual

company

N.

Broadway

Tel. DIgby 9-1550

simultaneously.

on

Request

on

construction

infringes upon
ficiency of an operating
program

construction

Rights

Gersten & Frenkel

affected
during

a

fact

known

Rights

Rights

&

*Prospectus

large- construction
at all three of its plants
in

&

in

income

net

and

sales

&

Common

stock. The reasons for the de¬
in

(w. i.)

Pacific Tel. & Tel.

$4.47 per share of com¬

or

Pfd.

Common

$1,-

ing the following: The steel strike
of mid-1952 resulted in curtailed

company,

interesting, to note that

cording

the

the

equalizing

ucts.
.

notes

and

situation is attested by the follow¬

i

DETROIT

relatively

a

important contributions to

seasonal

NEW YORK 4, N. Yi
CHICAGO

declined

income

net

offices

Cleveland Electric Illuminating

sales

net

Metallurgical "Company,
Since that time substantial addi¬ Inc., engaged in the business of
Pittsburgh Metallurgical Com¬
tions have been made to both crude producing ferro alloys which are
pany, despite its relatively obscure
reserves and potentials.
The num¬ used not only in the production of statusr is one of the largest pro¬
ber of. acres of potential oil and ordinary carbon steel but, more
ducers of ferro alloys in this coun¬
importantly, in the production of
gas land increased from 475,000
try.-Under the guidance of Mr.
stainless and other alloy
steels.
acres to
869,000 acres during the
Charles F. Colbert, Jr., Chairman
As of June 30, 1952, which is the
past year.
of the Board, President-and Gen¬
end of the company's latest fiscal
More importantly, Warren is the
eral Manager and who has been a
leading
independent
enterprise year, its capitalization consisted director of the company since
of 249,346 shares of common stock,
specializing in natural gasoline

CAROLINA

I

is

obscure

Oklahoma, Louisi¬

Kansas, Mississippi, and New
Mexico.
As of June 1951', crude
ana,

reserves

1952,

30,

1.40'Conv.

'

llllftlltlllllllllllllllllllllllllllllllllll

Bell

in¬

contrary,

the

in addition to that

along with 191 billion cu. ft of gas.

Lynchburg, Va.

in

dustry, but on

fully acquired
on
Nov. 1, 1951.
Warren, along
with this subsidiary, now holds
substantial acreage in the Willis-

Dan River Mills

Since 1932

known

American
oil

Gas Co.

Tele. LY 62

not

of the bet-

companies

-

The Devonian Company, a crude

Commonwealth Natural

Moore

is

one

ter

Devonian

$5.06.

se¬

my

lections, this

cluded, net for the 1952 year was

Alabama-Tennessee

In

approximately $20,477,000

totalled

branch

our

Commonwealth Edison*

$7.35

June

ended

to

or

per share of
the fiscal year

or

stock.

$1,834,184,
common

wires

-

per

iiiinmmiiiimiiiiiiiiiiiiiiiiiiiiiiiiM'

Direct

$12 per share, aggregated

engaged

This

Earnings

YORK 5

2-7815

$2,960,000,

of

Taxes

Income

almost

NY 1-1S57

Orleans, La. - Birmingham, Ala.

Net

$20,564,548.
year,

net sales

1951,

30,

Exchange

Mobile, Afa.

totalled
income for that
after provision for Federal

June

York Curb

St., New York 4, N. Y.

HAnover 2-0700

New

ended

year

program
Partner, Hay, Fales & Co,, N. Y. City
are
located
at
Niagara
Members, New York Stock Exchange. which
Falls, N. Y., Calvert City, Ky.,
Pittsburgh Metallurgical Company, Inc.
and Charleston, S. C. It is a well

-

Stock

York

fiscal

the

For

New

25 Broad

$20,000,000

the

passed

had

mark.

sales

year as my selection for
recently, Warren increased
the excellent feature "The Secu¬
quarterly dividend rate to 40c
per share from 30c;
At the cur¬ rity I Like Best," I am picking
exceptionally strong growth
rent price of about ;30, the shares an
stock within a
yield 5.3% on the present $1.60
strong growth
annual dividend rate.

Members

York

New

Steiner, Rouse & Co.

$5,000,000 mark and by 1951

they

cline

the

New

New

that fiscal year the company was

held

jfepONNELL&rO.

Co.,

-

vestment category.

At

the

and

1951.

in

capable, aggressive manage¬
ment to place it among the more
attractive issues in the semi-in¬

Since 1917

BROADWAY,

Quoted

Part¬

.Members New York Stock,Exchange

raised, and the potential of oil
gas

lier

August Huber

and

Rights & Scrip

in

issue

an

income

return, strong

York

mon

under the

earnings, ade¬

Specialists in

Jr.,

Munrce,

Hay, Fales &
City. (Page 2)

ner,

higher rate, the dividend has

shares

the

tributes of

high

a

been

the

necessary

Teletype NY 1-583

for

return

Although earnings are running

believe

I

of

rate

"growth" category.

the

Best."

V. Curb Exchange

dividend

$1.60 per share provides a yield
of 5.3%.
This is a relatively at¬

"Se¬
Like

pointed
curity

selling at a con¬

are

increased

the

in-

p

at 30

the

servative ratio of six times, while

than

the

Broadway, New York

of

quarter

earnings,

$5

current

shares

better,"

like

I

rather

120

Louisiana Securities

Hu¬

Members

first

the

for

ago.

securities

the

S.

—Harold

Petroleum is regarded as

Profits

ing it "among

United Gas Corp.

120

August

City. (Page 2)

favorably situated "growth" is-

a

label¬

erty of

Development

BA»clay 7-5660

—

sue.

lib¬

the

take

Puget Sound Power & Light

N.

Alabama &

Bought—Spld

suggestion
repre¬
sents one among others, which I the new fiscal year—three months
have been privileged to outline ended Sept. 30, 1952—increased to
briefly in this column, I shall $1.35 per share from 94e a year

Iowa Public Service

Established

—

Warren

this

Since

Central Public Utility

Associate Member

York

transportation,
chemicals,
promises to continue and

ities,

Spencer Trask & Co., New York City
Members, New York Stock Exchange

request

on

Arkansas Missouri Power

Smelters

Petroleum

Warren

forum are not intended to he, nor
offer to sell the securities discussed.)

AUGUST HUBER

Stock

&

particular security.

a

and

Selections

Pittsburgh Metallurgical Co., Inc.

Peoples Gas Light & Coke*
Rights

Their

(The articles contained in this

Electric Bond & Share

*Prospectus

for favoring

Participants

Forum

ber, Spencer Trask & Co., New

Pfd.

Conv.

$1.40

&

Rights

I Like Best

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

v

.3

Week

This

A continuous forum in which,

.Thursday, November 27,1952

next

dividend

of

50c

per

paid in September and
in

dividend will be due
of this

year.

Making

a

conservative assumption of a con¬

N. Q. B.
OVER-THE-COUNTER
INDUSTRIAL STOCK INDEX
12-Year Performance of
35 Industrial Stocks

tinuation of the 50c quarterly rate,

dividends for the fiscal year end¬

POLDER

ON

REQUEST

ing June 30, 1953, will aggregate
$2.00
of

per

5.6%

share, affording
at

the

current

a

yield

price

of

National Quotation Bureau
Incorporated

46 Front Street

Continued

on

page

27

NewYeric4*N.Y.

Volume 176-

Number 5172

The Commercial and Financial Chronicle

...

(2015)

Growing Importance
Of Foreign Trade

INDEX
Basis for

"

;

f

..

.

to

An

magnitude of American investment in foreign trade
Calls attention to UL S. increasing
dependence on foreign raw materials, and lists as important

and navigation.

to

all

am

of you.

consecutive

sure,

For

of for¬

than

six

American

is

own

of

partly

from

sources

and

such

iron

as

materials
our

own

ore,

mag¬

which

we

increases

nitude

are one

abroad

of the

basic

own

con¬

our

volume
and

of

of

duce

get

re¬

a

high
prosperity for
both capital
labor.

ican

F.

Loree

Besides, a fine Amer¬
typewriter or any
product
which

car

or

American

gives

better

than

abroad must

spect

for

the

free

our

do

good

United

enterprise

service
win

to

more

re-:

States

and

system

than

thousands of words of propaganda
broadcast to foreign lands.
More than $15 billion of private

capital is

etc. Of the 72

Board,

more

those

tial

to

the

materials

maintenance

essen¬

of

„

our

standard of living and to the stra¬

tegic

strength of the

whole free
gives employment to
those living in the areas where it
world.

It

is invested and provides the means
for development of resources

which ; otherwise

would

resulting enterprise.
The increasing dependence

place

on

materials

matic

more

growing

our

The Materials Pol¬

than 100 mineral

terials essential to

life,

only

things

our

such

sulphur, coal and phos-

as

Mr.

Loree

the

at

First

General Session of the 39th National For¬

eign
Nov.

NYSE Would

Trade Convention,
17, 1952.

New

Stability—Raymond Rodgers. 21

on

Taxation—Craig R. Sheaffer 25

"Identifying Statement" Published

Edison

Co.

expansion

Offering

Congressional

Stock

tion of

of

raw

through

As

business:

We

Bank

See

and

Business

It

(Editorial).^

Insurance

Stocks

Bookshelf-

ventions

York

for

the

Coming Events in Investment Field

Mutual
NSTA

27

___,

than

of

a

Our

investment.

Proposals

criticisms
many

of

policies

to

executive

Offerings

page

35

Stock

25

B.

Twice

Park

Place,

REctor

2-9570

N.

f

BROAD

TELEPHONE HAnover 2-4300

'

Boston

LOS




WILLIAM

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

•
•

Nashville

Chicago

"
•

Thursday, November 27,

Glens Falls

•

Schenectady

•

Worcester

CROW ELL, WEEDON & CO.
ANGELES, CALIFORNIA

state
-

Thursday

and

Other

Chu-aKO

city

Ill-

(general

news,

Offices:
3.

335

ary

President

1952

news

etc.).
South

La

as

C.,

8alle

N. Y. Phone

WOrth 4-2463

Eng¬

"

LAMB0RN & CO., Inc.
99

second-class matter

WALL

STREET

Febru¬

25,

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

Subscription

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

E.

Street, Boston 10, Mass.

2-6190

Copyright 1952 by William B. Dana

to 9576

SEIBERT,

811-

NEW YORK 5,

N. Y.

1879.

SEIBERT, Editor & Publisher
DANA

Exchange
Per

Liberty

Company

Y.

issued)

Stock

INCORPORATED

40

Drapers' Gardens, London,
land. c/o Edwards <te Smith.

York,
7,

York

equivalent $62%

75 Federal

I

and

$421/2*

and if

Dayton Haignoy & Co.

5

48

Weekly

York

app.

New

as

41

___

COMPANY, Publishers

New

*Listed

$11%*

com

(when

z

CHRONICLE

DANA

HERBERT D.

Exchange

1% shares $5 pfd

16

(Walter Whyte Says)

COMMERCIAL

FINANCIAL

York

1-share

Security I Like Best...

The

.

St.,

(Telephone: STftte 2*4)613):

sh.
sh.

counter)

18

__

Washington and You

the

per
per

Proposed reorganization plan

29

Tomorrow's Markets

$ 57

■.

44

:

_______

The State of Trade and Industry

and have been reported to Council

price

pfd.

cum.

(12/31/51) $140

(over

24

Securities Now in Registration
The

current

46

Security Salesman's Corner

departments

$7 prior
accumulations

5

;

Railroad Securities

respecting

on

May

Report

Security

Boston &. Maine Railroad

16

26

and

agencies of the Government,

Continued

Wilfred

Public Utility Securities

of these matters have been

offered

Reporter's

Prospective

Exchange PL, N. Y. 5

34
:____

Our Reporter on Governments

of

40

39

Funds
Notes

free

avoidance

HA 2-0270

17

Current Business Activity

'

■

Singer, Bean
& mackie, Inc.

8

Teletype NY 1-1825 & NY 1-1826

of

Observations—A.

gov¬

Airlines

S.

16

________

Recommendations

alloca¬

taxation; and many other
subjects affecting foreign trade

City,

Members New

Private Wire to

U.

48

News About Banks and Bankers

Spencer Trask &

•

Reeves Soundcraft

Einzig—"Sterling Convertibility and the Coming

have

rather

Fresnillo

.J

Dealer-Broker Investment

double

and

Corp.

27

From Washington Ahead of the News—Carlisle
Bargeron

through

operation

and Research

25

Securities

Indications

committees

direction

.

Cover

_

__

WILLIAM

Manchester, N. H.

T

Associated Development

.

24

Reentered

-

'

24

____

Reg. U. S. Patent Office

•

i*-4 23

%

Regular Features

r

Man's

Canadian

of Amer¬

international

the

Detroit

•

22

Prices

Commonwealth Conference"

materials

Los Angeles

•

Chicago

Cinerama, Inc.

specialized in

Albany

Philadelphia
8

informed

issue

Teletype NY 1-3370

«

by the Council of
the constructive views of foreign
traders regarding tariff questions;
the

Broadway, New York 6

BO 9-5133

on

_____

Reduce-^erhbership

-

foreign trade.

been

Reilly & Co.
Incorporated

61

the

cover

Published

25

J. F.

22

pro¬

commerce.

For many years we

have

f'

•

Business Cycle Has Not Been Repealed!

Consideration

"

by

Forecasts Lower

Matters for Congressional

and
*Address

■

Council,
and

of foreign

ma¬

standard of

one-third

about

f

_

improvement of conditions for the"
ican

Remington Arms

19

20

Predicts Spectacular Uptrend in Business

its efforts to the maintenance and

ernment
we

icy Commission, in its report, "Re¬
sources for Freedom," states that
of the

Commonwealth

since its founding in
1914, the Council throughout the
past twelve months has devoted

and

18

Dye.l

Stevenson-

First Post-Effective

year

conduct

Steel

Direct Wires

foreign sources of market;, treaties
of
friendship,
is of highly dra¬
commerce
and
navigation; con¬

importance to

foreign trade.

A.

Needed: A Constitutional Limit

exports, imports, investments,

every

Star
•

Trade, Finance and Balance of Payments—D. F.
Heatherington 23

transportation, communication, fi¬
nance, insurance, travel, etc. As in

no

or

to receive the investment and the

raw

international

range

•

Lone

Currency Convertibility Coming, But Still Far Off

—H.

the

support

our

whole

v

17

Utilities—Carl C. Brown.

on

Consumer Credit Aids Business
World

cause

Trade

further

Council's activities

Too often this

mutuality of
advantage is forgotten when the
receiving countries begin to feel
that capital is getting too large a
share, although these same coun¬
tries were glad enough originally

must

to

Newport Steel

remain

unavailable and have little
value.

to

Foreign

Forget!—Harry A. Bullis^

K

the

and

it

The

Much

provide the United

raw

trade

surrounding

seeks

•

14

'

by our Munitions
than 40 must be pro¬

interested

__

12

as

tect

States but also the peoples of the

with

pro¬

vided entirely by imports and the
balance partially by imports.

problems

Hooper

Spang, Jr.___

'

strategic and critical

International

P.

Automobile Credit Problems—T. C.

assumed

items

Lock Thread
___

of

materials listed

which

States

not

—-

**

Prolonged Depression Inevitable?—Eugene Hesz

Inflation's Effect

columbiun,,,
cobalt, high-grade quartz crystals,

National

of it is used to

do

we

has

such

owned

lands where it is invested.

consists

-

15

Lest We

in

Americans in

wholly or partially
enterprises in foreign
countries. This capital benefits not
only the people of the United.

list

-

Cinerama, Inc.

14

greater

inence

invested directly by

now

which

third

vances

other

the

YORK

4-6551

12'

Is

greater
importance as ad¬
technology and hightemperature alloys and electronics
have brought into greater prom¬
and

Robert

of

STREET, NEW

9

10

More Trade—Less Aid!—J.

from

annually as our
production pro¬

and

WALL

Telephone: WHitehall

What of New Labor Relations Legislation?—Harold
King

at all, and which we must
entirely from abroad.
This

latter

sulting

and

third

materials

production

acquire

today!

6

The Personal Side of Investing—Lucien O.

a
diminishing percentage of
growing requirements.
The

other

high

a

must

reserves

vide

o

mainten¬
of

Abroad

_

abroad,
petroleum, cop¬

of

ance

09

r

re¬

sales.

us

Obsolete Securities Dept.

6

Campi

.

per, lead, zinc, and bauxite.
The
proportion of these items part of

t

Cherry___

Needed: More Trade and Less Import Restrictions
—Hon. C. D. Howe..

from

partly

obsoletes.

5

-

investments

See

How Banking Is Affected by Vicissitudes of Railroads
—David C. Bevan
■
]

ob¬

we

Sales

tributing

L.

4

L_

Reducing Your Investing Risks—G. M. Loeb__

month.

the

Headaches—Roger W. Babson.

—Jack

Another third

resources.

composed

tain

averaged well
above a bil¬
lion dollars a

elements

about

Cobleigh

Why American Companies Made

Cites work of National For¬

our

ex¬

ports have

such

4

Bear Market—Ira U.

a

Lower Interest Rates Ahead!—Harold S.

phate,
but
including only two
metals, can be fully supplied from

is apparent

more

years

"TURKEY"

What Can Be Done About the Payments Problem—Ivar Rooth

The growing importance

#

eign trade, !

LET'S TALK

Cover
3

Ike's

eign Trade Council.
•

Cover

_

Inviting Stock Market!—Kenneth Ward.!__

Long-Term Outlook for Equities—Benjamin Graham

Congressional consideration: (1) constructive tariff

commerce

and COMPANY

•

Quick

adjustments; (2) international allocation of raw materials;
(3) avoidance of double taxation; and (4) new treaties relat¬
ing to

1

..

Wools in

and the

-

..

Growing Importance of Foreign Trade—Robert F. Loree

increasing volume of world trade

activities and enterprises.
matters for

a

_______

Chairman of the Board

National Foreign Trade Council, Inc., New York

Mr. Loree calls attention

Page

New Foreign Economic Policy
—Winthrop W: Aldrich__

By ROBERT F. LOREE*

LicHTinsTtin

-

Articles and News

Subscriptions

Possessions,

in

Rates

United

Territories

and

U.

8.

Members

ol

States,

SUGAR

Pan-American

Union, $45.00 per year; in
Dominion
of
Canada,
$48.00
per
year
Other Countries, $52.00 per year.
Other

Publications

Bank and Quotation Record —
Monthly.
$30.00 per year. (Foreign postage extra.)
Note—On account of the fluctuations Id
the rate of exchange, remittances for for*

eign subscriptions and advertisements must
"f
made in New York funds.

3''

Raw

—

Refined

—

Liquid

Exports—Imports—Futures

DIgby 4-2727

4

The Commercial and Financial Chronicle... Thursday, November 27,1952

(2016)
)

Wools in

portant gains in operating
ciency have been noted.

Beat Market

a

The

While dull earnings and

i

woolen share market in

inventories have wrapped the
blanket of gloom for months, better

a

In

the

stock

spectacular

phony generally referred to as the
Bull Market of 1952, certain in¬
struments have been playing low
andflat

—

them

among

woolen

the

shares. They're

just another
division, along
with

the

movies,

the

Nov.

on

War

U. Cobleigh

Ira

if

and

someone

asks

"How's

the

market?", more than ever are you
entitled to jibe "What market?"
True, the rails, electrics and elec¬
tronics are good, but when will

the
house (sheep dog, that is)?
the'

wools

get

of

The

its

year's low, you may, on
thorough delving into the facts,
conclude that perhaps this enter¬
prise has already encountered its
share

full

of

the

factors

adverse

native to its industry.

smaller

much

A

The

one

with

ord

of

but

Bell

sales

and

reach

Company.

Bell

time beamed its pro¬

some

programs

effectively

_

.the

the

to

luxury

quite impressive

in

future

situation

realm,

between 1925 and 1942,
would feed that equity prices
had entered upon a different era,

us

in which

the economic

you

none of
actually

have knowl¬

of the

opinions
us

central

d'd for
it

years

show

will

From

some

a

1924

shares

of

benefit

$40.50

till

prior to 1939,
the

1946

common

were

year.

978,342
without

of

per

dividend,
although
share, in total, has been

paid since that time.
a

this

deficit

You'll have

$100 mil¬
such wide

a

lion

company
with
swings in fortune.

Actually, it seems WY racks up
its big earnings only when de¬
mand is roaring, and big inven¬
can

be

of

raw

worsteds,

and
stockpiling,
the
standard grade of raw material—

full

wool

have

in

of

uniforms,

a

top—zoomed from $2 a pound
July, 1950 to a fabulous $4.80
pound in March of 1951. And,

a

year,

And

to

the

journeyman

economist,
it
standard operating

merely

sheared from

wool

ditto.

trade

was
pro¬

been

not

shown

after

buying and the

and importantly on

inventory

others;

a

stopped

its

problems

acute

as

and
loss

a

less than

quantities

in

demand,

order,

anticipating
sustained
demand,
bought a lot of wool.
Then what happened?
The gov¬
Bachmann

retail

the
in

but

(1932) in the last 21

one

years.

pretty fine record for

Net

for

1951

was

a

year

That's
textile!

depreciation.
value at the 1951 year-end
$22.70.
For
the
first
six
inventory

quarter
Book

has

$490,000 even
million and a

was

thumping

a

those

as

company

over

$2

$2.10.

It would
lethal

this

wool is at

a

an

on

into

appear

that

shakeout

in

end.

So Bachmann

(and

now

market

Uxbridge in 1951

a

out

an

1952) had

to work

inventory loss; and at the

the

shares

basis

WOULD YOU LIKE TO REDUCE
OVERHEAD?
-Complete Clearance Facilities for Member Firms

-Interesting Ideas for Out-of-Town Member
inquiry is cordially invited

MEMBERS

NEW YORK

MEMBERS

NEW

YORK

&

CO.

STOCK EXCHANGE
CURB

EXCHANGE

REctor 2-2820

not

on

a

dividend

Probably

the

inventory debits have al¬

War

II

marked

was

third

by World

its

and

aftermath, and
not only a resumption of

gave us

the

upward

movement

of

stock

prices

(a virtual doubling of the
averages from 1939, say, to today)
but also an unusual phenomenon
in the absence of any very severe

setback

of the

market

leaders in

that entire 10-year period.

Those

of

whose

you

business

experience is limited to the

years

from 1940 to 1952

get

inherent
than

markets

(Mr.

might very well
different picture

entirely

an

the

of

nature

those

Roosevelt

haps)

who have

fore

of

stock

us

of

and

veloping since

here.

myself,

1914,

per¬

things de¬

seen

or

be¬

even

time.

that

Pre-1929

prices,
reached

about 90 in 1925. You had in that

As

Ideas

result of the

a

Back

rise that has

taken

place since 1939, some of
the
pre-1929 ideas are back in
underlying, upward move¬ circulation. It is now customary
ment, punctuated and sometimes to publish charts which show the
almost disguised by wide fluctua¬ movement of
the averages—say
entire

54-year period

well-de¬

a

fined,

tions

between

and bear

bull

market

it

as

the decades

over

ciently clear

was

un¬

suffi¬

that Edgar Law¬

so

from

1897, when the Dow-Jones
started

record

However, the record
folded

tops

market lows.

quite

definite

indicate

and

—

long-term

rise

a

of

the middle value, the upper value
and the lower value.
of

Most

the

seen

shows

I

you,

three

the

have

suppose,

Chart

Keystone

lines.

which
If

you

study it, you will find something
rather interesting, namely that the
average

market

increase

at

the

values
of

rate

every ten years.
is that the gain

seem

What that
in

to

one-third

stock

means

values

dis¬

indicated there is at precisely the
same
rate as the increase in the

The actual effect of reinvestment

value of series E bonds, which are
bought at $75 and are worth $100

reinvestment
turbed

of

profits

not

dividends.

as

of profits is somewhat controver¬
sial.

The Cowles Commission fig¬

in

ures,

their

published

study

about the middle of the
dicated

that

prices did
increase

the
book

flected

about

whole

of

in

average

fully

parallel

not

in

rise

1930's, in¬

two-thirds

the

the

values, but re¬
the

on

ten years later.

The vital difference, of course,
is

that not only did the stock
buyer get the 33%% increase in.
ten years,
but he received the
dividends
not

get

income

well; whereas you do
corresponding interest

as

a
on

the bonds.

I

of

reinvestment

a

Bachmann is already one of

dent.

the largest users of spun nylon.

Firms

the

might add that there is also
similarity to the chart showing

been seen, greater
effi¬ earnings. However, the underlying
the annual increase in overall ef¬
average
prices
in¬
ciency is being sought, and some thesis that
ficiency, or productivity per manturning to synthetics as an offset creased over the years because the
hour in the country's economy. It
to gyrating wool prices is evi¬ assets and resources of the cor¬

Further, as has been noted in
cotton textiles, there's an impor¬
tant

trend

to

These

Broadway, New York, N. Y. '




stock

1871,

ready

panies

ABON

are

currently.

heaviest

Telephone:

of

in

37

tendency
for
equity
feels that a last-half inherent
earnings upturn is a real possi¬ values to increase over the years,
and he related that tendency to
bility.
the basic fact that corporations
Intensive
research, and some
build up their book values by the
important new developments in

the

115

at

apparently

situations,

Your

index

starting

had

find

we

for
the
wool
price
to months of 1952, a net loss of $405 rence Smith, was able to form an
plummet, as it did, to a low of thousand was shown, primarily imported conclusion in his small
$1.80, in September, 1951. Then from
non-recurring markdowns book, "Common Stocks as Longa market stabilization, of sorts, oc¬
on
inventory carried over from Term Investments," published in
curred between that figure and last
1924. He saw that there was an
year; and the management

blending of wools and syn¬
thetics give some promise of bet¬
same
time finance a rather am¬
pound in a single year!
ter days ahead.
Meanwhile, Bell
Even with some stabilization in bitious
program
of buying 100 common (only 335.620 shares out¬
the
wool
markets,
the current Warner & Swasey Sulzer
Weaving standing) is at 8V8, down 50%
projection on WY is not too op¬
Machines to replace certain old from its 1951 high of 16Vs. A lot
timistic. Deficit per share for the
of devaluation
has taken
place
first nine months of this year was and outmoded looms. Where these
here—perhaps enough.
$4.66 (against $10.22 earned for new machines are in service, im¬
In all three of these
staple that has varied

1871 to 1925. There

the

that

have

we

1942. It

or

cedure

rising wool prices. In times be¬
tween, the cost of maintaining 26
mills, with a big percentage of
idleness,
strains
the
earnings
statements; and then, of course,
if you carry a big inventory, as
does
American
Woolen,
heavy
losses are, at times, inevitable.
WY
uses
roughly
100
million
pounds

by panicky government orders for

be

period, which began either in 1949

study.

about

would

against 90 for 1925—both

Then

and

uninterrupted

ernment

tough time finding

tory profits

a

prices

years.

Benjamin Graham
rec¬
clothing trade.
To that end, it
This subject
earning has created a broadly diversified
would best be
Let's look at two or three wool¬ power is Bachmann U x b r i d g e
line
of distinctive
fabrics mer¬
approached by referring first to
Worsted Corp., with 1,050,000 out¬
en companies; and let's straighten
chandised under the brand name
the
long-term
past
history
of
standing shares of common, pre¬ "Miron."
out at once the fact that woolly
These
are
sold
to
a
equity prices to see whether that
bears are fuzzy caterpillars that ceded by $1,867,000 of preferred limited group of manufacturers,
will give us a guide to conclusions
tell the weather, and not short stock and a bank loan at the end and certain
patterns are offered about the
long-term future of
sellers in American Woolen! This of September of $11.5 million — as yard goods for distribution by
is as nice a lead line as we'll get down from $18 million 12/31/51. prominent stores in a number of equity prices; and then by raising
questions as to the differences, if
a
to limn for you the largest manu¬ Here's
stable, well managed large
cities,
such as Marshall
any, that exist between the situa¬
facturer of woolen and worsted property which has operated at
Field, Lord & Taylor, Strawbridge
tion for the future and that which
fabrics on this planet, and pro¬ a profit in every year since 1924 &
Clothier, etc.
This policy of
has obtained in the past.
ducer of 15% of total American even though 1951 results were a
keeping "Miron" as one of the
The history of stock prices in
squeaky
net
of
only
$120,714, top names in
output in these divisions...
"
fabric, is further record form
goes back, I would
If you like volatility in your down from a fat $3,150,000 in 1950.
implemented by an extensive ad¬
1951 was a dreadful year for vertising program, with a big slice say to 1871, the beginning of the
investments, American Woolen is
Cowles Commission's figures; and
your boy!
Common sold at 3% wool,
however.
Egged
on
by of it ($665,000 in 1951) paid for
that history appears to divide it¬
in
1942, 703/4 in 1946 and 23% fears of shortages, engendered by by retail stores.
self pretty well into three parts.
today.
Earned $21 a share for the Korean outbreak (July 26,
Because Bell has sought to turn
The first period would run from
1946, $9.22 last year; and, as it 1950), and, a few months later, out
high-quality
woolens
and

American Woolen

of

reasonably "normal" stock-market

adequate

reflection

89

was

let

hope, based

upon

level

sideways than up. Note that
the adjusted price index for 1939

is

—

un¬

more

and

surmises

an

derlying advance. It appeared the

What

have

we

clear-cut indication of

no

scientific

term.

they were still subject to
fluctuations, but there was

wide

the

in

edge

sense

market, discussed a few
paragraphs back, apply as well to
a
third
entry we'll now touch

duction

company

Company

wool

upon,

Uxbridge

Bell

Most of the uncertainties of the
raw

has for
Bachmann

dog

of

out

corporation taxes on dividends and net earnings. Con¬
cludes, despite adverse conditions, the long-term trend of com¬

Because Bachmann has already
mon stocks will continue in
future, as in past, to be irregularly !
rence, Mass., and in Dover, N. H., surmounted most of its inventory
normally employing 2,000, and 400 headaches, is improving in effi¬
upward, and an equity investment, when made at a reasonable <V
workers, respectively.
The an¬ ciency, has 55% of its loom ca¬
price, is a promising one. '
;.
nouncement stated that the com¬
pacity in the South and West, and
The subject assigned to me for
pany "can't conceive of business has
culminating in 1929; then the tre¬
proved for two decades an
getting good enough to require us ability to earn money under all this afternoon is one about which, mendous collapse of stock prices
to operate the mills." Thus 2 out sorts of business
conditions, there precisely speaking, I know after 1929, and then a partial re¬
of the 26 mills owned and oper¬ are those who feel that this com¬ nothing. When it comes to state¬
covery
running up to 1940 or
ated appear out of business for
ments about
thereabouts. If you look at the
pany, with its common at an all-

good, leaving 22 (some of these, time low of 6% (1951 high, 133A),
too, not presently operating) in has been harshly treated marketchemicals,
to New England, and two in the wise. A company that can knock
drive
home South.
Working capital position off $6% million in bank loans in
the
necessity is strong and per share book value nine
months
must
be
making
for c o n t i n- at 6/30/52 was placed at $74.55. some sort of
progress.
uous
selectiv- With WY common within a point
i t y;

basic factors that make for stock value* and discusses effect Aof

was

of

dotting

a

(

analyst, in assaying future of stock prices, reviews ,
history of stock market trends from 1871 to present. Examines U

of total sales.

%

were

i
;

Investment

II, sales to Armed Services

and

distillers

President, Graham-Newman Corporation (a Mutual Fund);
Visiting Professor of Finance, Columbia University

60% of sales total
(1950) was from men's clothing,
20%, women's and 13% automo¬
bile fabrics. At the peak of World

the company announced that
closing its mills in Law¬

21,
it

period), and

1951

By BENJAMIN GRAHAM*

men's

priced

About

stery.

be in order.

same

sym¬

long-Teim Outlook for Equities

blended

and

clothing; military
automobile uphol¬

and

uniforms

•

lower

women's

and

soggy

quotes may now

for

fabrics

"Expanding Your Income"

Author of

worsted

woolen,

By IRA U. COBLEIGH

effi¬

manufactures

company

among

woolen

com¬

three

selections

tion.

may

to

"Are

market?"

ready

for

nounced

wools

still

in

a

bear

Perhaps they're now
a
market
U
(pro¬

ewe) turn!

'•*

*

over

seemed to be

a

Shortly

quite

following

Smith's

rence

the years,

Edgar

thesis,

Law¬

which

Wall

Street,

was

series
of events which called that point
of view completely

There

was

the

had

you

a

in to question.

tremendous

would not be too difficult to work
out

sound one.

adopted with too much enthusiasm
in

southern locations.

give you a current pic¬
ture
of wool manufacture,
and
refer to your own analysis and
judgment, an answer to the ques¬
serve

porations increased

bull

market—the "New Era" market—

some

man-hour

efficiency

somewhat

the

Mr.

Graham

in

report
a

course

nomics of the Securities
sored

by

the

New/ York
New York

of

New

on

lecture
"The

Industry,"

Investment

and

a

Eco¬
spon¬

Association

York

by

of

University,

City, Nov. 12, 1952.

rela¬

The

at

same

resumption

of

running
rate.

the

rise

in

stock

prices after 1941, or the re¬
turn to the old pattern (whichever
want to call

you

able
""Stenographic

cause-and-effect

tionship between the increase in
stock prices and the increase in

the

to

war

two

it), is attribut¬

basic

causes:

First,

and the postwar business

activity with the earnings gener¬
ated thereby; and, secondly, the
Continued

on

page

30

Volume 176

Number 5172

...

The Commercial and Financial Chronicle

(2017)

Steel

The

Ike's Headaches

Production

Electric Output

By ROGER W. BABSON

Cat-loadings

State of Trade

Mr.

over-all

period ended
to

a

total

for .the

nation's

industrial

effort1 in

the

Wednesday of last week reflected

slight advance

a

record level since the close of World War II.

new

Increasing
week, total output was placed at about
5% higher than the year ;before, but was still about
7% under
the all-time record
attained-during World War II.

-

,

;
"•

"

remained

slightly

over

one

lowest point since the end of the above conflict.
that defense materials displayed a

million,

or

the
v

'

\

•

•

steady rise.

.

a

*.

'

,

'

'

?

•

is

that

his

,

be

a

§8--I

up

0.1%

Labor

in

the

Statistics'

month

ended

consumer.

A. Wilfred

problems?

The:

190.9% of the 1935-39 average—1.9% higher than a year ago.
rise, however, was too small to offset previous declines in the
quarter ended in mid-October, resulting in close to a million auto
and aircraft workers whose
wage scales are geared to living costs

hourly wage cut, effective Dec. 1.

1

r

•

C

.

Residential

rents

were

0.4%

up

laneous goods and services 0.3%.

,

The Bureau said the climb in
led by a 2.1% rise in Detroit, where rents were decon¬
trolled Sept. 30. Detroit
workers, of course, will bear the brunt
of the one-cent wage reduction
by all major auto companies, v ; ;

rents

was

Steel companies in

t

e r

which brought

depression of the 'Thirties, fol¬
lowing
several
bountiful
years
under

Ike

President

reads

Coolidge. When
Chapter of

the

41st

Genesis

profits—but they should do

Of the 1952 expansion total, more than 6 million tons is
rep¬
resented
over

by

openhearth capacity. Balance of the new capacity,
1 million tons, is due to electric furnace
expansion.
new

When final figures for

1952

in, openhearth capacity will
be over 101 million tons, an increase of
6.3% over capacity at
start of the year, and 11% over
capacity at Jan. 1, 1951. Electric
furnace capacity will be over 9 million
tons, up 13.5% from start
of the year and 24%

are

come

.

lion tons is scheduled for the East.

Ike

headache

must

that

of

the

by

so

increasing production — not by
striking. During the past 10 years
Labor

Leaders

have

They will
give up this power without a
struggle. Yet, Ike will consider it
his duty to curb this dangerous
not

situation.

We

back

must

Ike

up

in his efforts.

Ike knows that
tic

to

keep Europe
Japan from going Communis¬
must -accept

we

their

goods

graciously. To raise tariffs would
will

make

a

con¬

decontrol

A

steel

recommendation

drive upon

the

following

market

forecast

for 1953:

(2) No

as

much

as

118.8

million

net

(3) This will leave

as

more

much

as

104 million

will have been available for non-defense

An

uses

open-end Controlled Materials Plan

near

future.

There is

tons for all other

than the estimated 80 million tons which

a

seems

ucts be

assure

that defense production needs of
tight prod¬

met, states "The Iron Age."

Model changeovers last week made United States auto
output
from last week, but production was still a good 59%

the like week

a

year ago,

states "Ward's Automotive Re¬

ports."
Auto production so far this year is

a

drop of 22%

88,000 units—the lowest since early September. Production will be
"erratic through the year-end" because of changeovers and
holiday

shutdowns, it said.

pansion

unemployment

building

-

"Ward's"

believes

the appointment of Charles E.
Wilson, of
Secretary of Defense means that decontrol of




Continued

on

page

foreign sphere" [illustrating both foibles],

.

„

considerations

"Wall Street's
"The

new

renascence

itself,"

after 20 long years,"

Administration's friendliness toward business in¬

cluding the Utopian ending of the long
capital, in a capitalistic climate."
"The

outlook

new

"Relaxation

of

for

generous

assault

on

investment

extra dividends,"

price controls"

(conceived of midst falling
V stock price periods, as manifestation of declining commodity
prices and glutted consumer markets),
"A stabilized

commodity price level" (similarly regarded

as

bearish during a bear market),

"Prospective relief from the awful tax burdens and injus¬
as 'Excess Profits' taxation, the confiscatory liquor tax,

tices,

and the

capital gains' six-month holding period."
the

And

reasonable

suddenly

realized

concrete

fact

the basis of hard-boiled value.

on

that

stocks

are

*

One leading brokerage house's current

this rationalizing

process

letter—clearly demon¬
cat-out-of-the-bag in reporting;,

"the action

of the market also supports the theory that the favor¬
able economic outlook is a dominating factor." [italics mine]

has

manu¬

trades—

building.

inevitable.

appears

The "Double-Standard"

.'if

in Interpreting News

Manifesting the "double-standard" of economic interpretation,
we
see the directly contradictory construction
on a single external event.
For example^ high
corporate taxation (including EPT) is sometimes conveniently

time

and again
successively put

construed

bullish

because

of its

inflationary stimuli, at other
deflationary attributes, incentivedampening, etc.—all following the action of the stock market, or
perhaps to fit a forecast. We have seen the same with production
controls: for a bearish construction they are restraining, for a
times

as

as

bearish because

of its

33

Continued

Outlook
year

five

houses

were

built

10

years

ago.

couraging

if

times
as

This

a

these

shoestring.

ment

comes

as

during
houses
were

ruin

the
as

the

million

market.

market

throw

for

en¬

were

built

on

JOSEPH

H.

LEDERER

unemploy¬
of

houses could be vacated and
on

page

a year

When
a

on

many

would be

paid for; but they

This

these

houses,

millions

ANNOUNCES THE FORMATION

OF THE FIRM

come

could

of

as

J.

H.

LEDERER CO.

car¬

penters, bricklayers, painters and-

INVESTMENT SECURITIES

others out of work.
WITH

Ike has

stopped

No.

7—Inflation

won

But

millions of votes

can

without

inflation

deflation?

anybody want deflation?

Continued

on

OFFICES- AT

ft

-

*

40 EXCHANGE PLACE

promised to stop infla¬

tion and he

thereby.

>5 •'

into

go

Last

Headache

Despite such setbacks, though, the makers already producing
1953 models
"will persist" with vigorous
output," this agency

General Motors, as

III

World War III, this ex¬
is ending. Accompanying

well

3,828,500,

"Ward's" warned that this week auto output
may drop to about

v

the

which

Barring

back

from the like period a year earlier.

forecasts.

War

This has greatly

space.

likely in

decline 8%
above

World

great expansion in

dustries

good chance that all controls, except

will be lifted by April 1.
probably be continued for

time to

i;'

Headache No. 6—Real Estate

for military and atomic energy
priority,
The present system of directives will
some

of
a

stimulated

during 1952.

now

these:—

as

.

caused

more

purposes—one-third

the

Manufacturing Capacity
Fear

lumber, steel and the other 27 in¬

than 14 million tons will be required for military
and atomic energy uses, as now planned.

bull movement to "causes"

ket is the action of the market

strates

facturing

(1) The industry can produce
tons of ingots—if needed.

is

suggesting a usual
year-end
rally" [in contrast to the preceding preponderating emphasis
on year-end tax selling].
Significantly, another popular market
letter now comes up with this ex post facto discovery: "... the
best proof that tax selling of itself has no effect upon the mar¬

him for higher

Headache No. 5—Excess of U. S.

industry task force supported its

with

a

^

certed

the survey shows.

steel.

support

to

news—in

"Technical

;

suicidal, he believes. Yet U. S.

tariffs.

of

■

Headache No. 4—Foreign Imports

to the 600,000 tons scheduled to

for decontrol

elements,

forecast.

.

usurped the

of government.

powers

manufacturers

capacity, completed and in the offing according to the
above trade authority, is a potent factor in
industry arguments

relevant

and a
the tra-1

of

"The tremendous confidence in the ability of the incoming
Administration to contend with the vast problems being pre J

be¬

wageworkers

receive their share

Included among capacities to be added
early next year will be
1.2 million tons at the new Fairless Works of U. S. Steel in addition

New

process

financial

sented in the

realizes

should

be

be added before the end of 1952,

twin

reverse

.

worse.

Headache No. 3—Labor Unions

and

Geographically, over 3 million tons of new 1952 capacity is
being brought into production in the Midwest, while over 2.5 mil¬

his

the
.

t

capacity at Jan. 1, 1951, it further dis¬

over

closes.

interpretation

Conversely, now that sizable advances have replaced market,
declines, we see cognizance of the aforementioned economic "ex¬
planations" of previous market action replaced by attribution of

the Hoover

on

the United States are adding more than
7,250,000 net tons of ingot capacity this year, a survey just completed by "The Iron Age," national metalworking weekly, reveals.
When this is added to their capacity at the
beginning of this year
(108.6 million tons), year-end capacity will be close to 116 mil¬
lion tons, it states.
will raise the

n

factor

was one

Roger W. Babson

Completion of several large additional projects early in 1953
industry within reaching distance of its 120 millionton goal established
unofficially in early 1951 under the spur of
defense requirements, fast tax
amortization, and industry confi¬
dence in continuing civilian demand for steel.

.

i

a

are now

severelysuf¬

miscel¬

and

ditionally

selective emphasis

we see

constantly seen also in interpretation
rationalizing market action to fit it*
post facto.
With the recent reversal of the stock market's
course
we
are
being treated to good demonstrations of this;;
Exemplifying the selective-emphasis foible; were the "explana¬
tions" of the recent declining markets on the grounds of ex-:
pected
"Republican deflation" resulting from curtailment of
spending (following the British market pattern), and of pros¬
pective decline in armament activity, with or without armistice..
the

of

fering from
drought.: This

;

Food

refrigeration.

again

Fitting the News to the Market's Behavior
This

Weather

states

prices dropped 0.3% in the latest month. The biggest
increase, 0.5%, took place in utility charges—for fuel, electricity
and

arguments selected -;

ex

The

a one-cent

of

set

few of the visible factors,

a

preconceived

to

taking

May

other

Headache No. 2

price; index

on

"double-standard"

likewise show

Oct. ; 15,

.

of

Time and

centered

may

itself in

mass

a

or

cowardice

than last, it noted, adding, a 2% increase in con¬
prices and 1.7% climb in population will hold disposable

'

imponderables, well typifies j
prevalent basic foibles in forecasting.
v* j

sign

which

coordinated

one

from

not this

of Tear

year

Living costs inched
carrying the Bureau of

of

so,

may

rise in income receipts of individuals

*

truce

the first representing the,.'
self-interested argument of a labor leader tq >
prove his thesis, and the second the selection,;

young

people who dreaded Korea. If

two

This reasoning,

have-

and

on

for armament curtailment.

may

parents

nights-ago,

and second; that apparent relaxation,
political tension, through a ',j
or
otherwise, would unwar^
rantedly entail irresistible popular demand,
international

of

of the Election

landslide

from

come
'•

few

depression

duct ion;

,l

'

a

(following Keynes
Slichter) believes that the Republicanized Administra¬
tion's tendency to suppress wage demands will
curtail consumption and aggravate overpro^-

now

1—Korea

income per capita to the 1951 level.
•

; '

"

v

.

The sad feature

—

higher this

'

'

,

Headache'No.

in a private discussion
of; prospective disastrous

First the United Mineworkers' head

grounds.
and

fears

*

this year to a record $267 billion—up 5% from the
previous high
in 1951. Disposable income — income after taxes
will be 4%
sumer

his

broached

Lewis,

Korea

,

The Board also forecast

L.

selfish wishes.

-

It should be noted

According to the Federal Reserve Board, United States produc¬
tion of goods and services this
year will be the highest in history.
Figured at market value—without adjustment for price increases
—the Board estimated 1952 output at
$345 billion—up 5% from
1951.
Factors in the upturn, its survey
said, were increases in
defense production, consumer
spending and outlays for plant and
equipment.

On Market Double-Talk
John

declining stock and commodity
markets, and (9) a likely un-t
friendly Congress. Urges putting'
good of nation ahead of our own ;

v

for the third consecutive

Unemployment

By A. WILFRED MAY

capacity; (6) high mortgage indebtedness; (7) inflation; (8)

*
.

on

•

the

among '

Korea;

:

-.The

President's headaches:

lists

(1)
(2) the weather; (3)
labor unions; (4) foreign. imports; (5) excess manufacturing.

:

Auto Production

Business Failures

-

.

Babson.

new

Commodity Price Index

Industry

•

•

Retail Trade

Food Price Index

and

5

NEW YORK 5, N. Y.

be

Does

Solving

page

8

December 1, 1952

HAnover 2-5440-1-2-34

35

6

The Commercial and Financial Chronicle... Thursday,

(2018)

«

November 27,1952

i

Lower Interest Rates Ahead! ]
Edie & Company

when
supply, Mr. Cherry
Bases this belief on

expands faster than money

predicts softening of the rates next year.
substantial rise in non-producing consumer population.

has

rather

Lists

.

the

itself economy which was already exto
be
funda- pansive. Suppose you had Known
mentally that for a while after the Korean
strong. It had Invasion the actual and threatened
to
be
strong loss of purchasing power of the
to
carry
the dollar would increase the public's
extraordinary willingness to spend rather than

that it has proven

say

burdens it has
and

borne

well

as

do

it

as

It follows

has.

that any

ening

lightthe

of

up

a

rise has been declin¬

rate .of

the

debts,

year.

allows

debt,

strong incentive to borrow that

a

they could do so and leave the
proceeds of the loan idle and still ing

they

up,

doing so

are

at

absorb

their dollar credits and could

soon.

change

in the demand
for

money,•

should

fleeted promptly
ket

and

more

be

re-

in the bond margradually in the

whole interest rate structure.
basis of reasoning rests on

The

rather

the

peal.

proposition

simple

longer buy from

balance. To

us assume

that

y°u knew that the Federal Reserve would practically free itself

of the necessity of supporting the
bond market after which the Fed-

eral

Government would float
i°an

rise in

that interest rates tend to

us on

the climax, let

cap

no

without

more

a

in

are

of the

one

ernmeru

tal

Lower Rate of Debt
increase

How

can

believe

we

debts will increase at

which

economy

ing of interest rates next
In

year.

had known
that in the coming seven years the
population of the United States
1945,

suppose you

would increase

17,000,000,

or more

than that of New York and

New

fleeting Central Bank support.

than

this

that

total

lower rate

a

Rond

Markpt

NmirUhed

hv

have said that government bonds
should sell at 60 cents on the dol*ar to yield 5.3%. I think this
market is basically strong to be
selling at 97. The personal savrate,

mgs

reflected

as

through

the

billion
other
than

required to furnish the
equivalent of such a new country
with

complete facilities and at the
same time foster a higher standard of living for the whole Nation

Qf course, the bond market
looks bedraggled. It has been
fighting a hell of a war. - But,
basically, it is healthy. There is
nothing wrong with it that a littie less heavy artillery fire would.
n.°t cure. A little less fire, a; little
time to rest, and I think the bond
market would counter-attack and

this year.

Individual arid

non-corporate
farm

debt,

may

other

debt,
rise

about

$9.5 billion this year, but we are
expecting a rise of only $5 or $6
billion

in

This

1953.

estimates

that non-farm mortgages will rise

$6.8

billion in

with

.

be

answer

in the civilian economy,

Jersey combined. You would have pension funds, savings banks, inbeen shocked by any estimate of surance companies, etc., has nourthe
amount
of
money
which ished the market well.
would

The

year?

and

1953, as compared
billion this year,

about $7.5

that

other

types of loans to

individuals will remain unchanged

perhaps decline $1 billion.

or

we

re-

L.

Camp

sons

large

a

part of the public gifts and loans

estimate that the total

But

corpo¬

economies

the

oping

of

foreign

enjoyed before,

ever

,

nth

need to

degree.

known that

utilized

be

would

You

enormous

sums

to the

have
would

have to be spent for more efficient

productive plant and machinery,
It takes money to build suburbs
where people with babies want
to move.
Once there, they must
have
shopping
centers,
cars,
schools, streets, television, etc.
Growing children consume inordinate

amounts

.drugs,
toe

an

etc.

of

You

clothing, food,

do

not

birth of children in
{

creases

the rate

"money.
know

have

to

economist to know that the

All
that

need

you

is

family inturnover of

a

of

to

to

have

do

to

t™*.. foreign

countries

have the

ability to get on their productive
f,
the point where they will
seJJ u,® en?ugh goods to cause a
reduction m our gold stock. Forei^n J^vernments will do well
eiiOjugh .if they can hold the gold
winch is newly mined outside the
umted states,
,

stability in the Cost-of-Living In?e?. an(*
°fber commodity
farf,
J?1flation
o^t? decline further. The Federal Reserve is not depressing the
bond market. It is only letting
gnomic factors take their course,
„

e amoupt of Federal deficit fiiiancing is
uncertain for the
*on&er period. We do know that
Hrn«c
fanuary budget addresses have a
drugs, habit of

children.

The

enlarged group of aged requires expanded retirement cen-

ierc
ters,

larffpr hnqnitflic
larger hospitals, mnrp
more

etc.

Suppose
7T~

*An

you

jj

address

Conference

Association,
20, 1952.

of

u

Mr.

r-t.

Asbury

,

Cherry at the
Jersey Bankers
Park, n. j., Nov.

New




predicting a certain cash
figure which is revised

deficit

■

had known that at

by
the

*'

downward about 30%

an<* fioaily ends
half

as

I

matevation,

much

First

up

at mid-year

we

do know that the

sea¬

time

.element.

credit

We

credit cycle for

of which reached the

capital abroad, please permit me
sum up all of these reasons in
one

short

that

the last three
boiling point

expansion.

that

the

sentence—and

is

fighting the battle "stamping out communism," etc.
climate Much as we approve of these ob¬
years are like the forgotten jectives, never forget that when
man, who all at once finds him¬
you
or
I put our hard earned
self in the limelight and does not
money into a proposition,
other
know quite what to make of it.
than charity, we want the assur¬
You are probably aware of the ance that the principal can be re¬
of satisfactory investment

for

1

fact

several

that

government

at
present doing
their best to get American inves¬

agencies
tors

to

are

abroad. The Interna¬
tional Development Advisory
go

covered, if we so desire, and that
there will be a reasonable return
the

in

Getting

-

a

Picture of Investment
Possibilities

<

tives

public knowledge that Sec¬
Sawyer with representa¬
from the Business Advisory
v

Council

the

and

Committee

Economic Development is
rope

divi¬

profits and

Three

Principal Motives

that there
principal motives be¬
hind
foreign investments:
first,
those who go to develop sources
of raw
material; second, those

-

I believe we may say

are

who

three

follow

the

call of .attractive

profits; and third, those who seek
to
protect
markets
previously
open to U. S. manufacturers. The
first group includes oil and min¬
ing companies, agricultural and
forestry enterprises, such as ba¬
nanas, other fruits, food products,
vegetable fibers and oils, rubber,
lumber, etc. The most prominent
in the second group are the utili¬
ties, transportation companies and
American

banks.

Third

are

the

American

It is

retary

of

form

dends.

for

manufacturing
con¬
cerns, which have had to
build
foreign plants- and/or marketing
organizations in order to protect
their
name
and
percentage . of

in Eu¬ sales participation in foreign coun¬

at the present time for the

tries.-

.

I understand it, of
Second, surveys which indicate getting a general picture of pri¬ Requirements for Sound Foreign
Investments
that many businesses intend to vate investment possibilities and
;
slow down plant expansion next problems
All of
these groups have in
in that part of the
year.
It looks as if the steel in¬ world. MSA, which until recently common
certain - basic .require¬
dustry will practically end its ex¬ confined its guarantee program to ments, which must be met before
pansion during the first half of Europe, is now extendingthis to serious consideration can be given
1953.
Ten million tons of new Latin America and other areas to
putting money in a foreign
productive capacity will come in with-,the, hope that much new country. Placed together these re¬
during the iirst half of next year, money will be invested abroad, if quirements are referred to ai a
and 5,000,000' now going into, the there is an American government "satisfactory investment climate."
expansion of steel Jtself will cease guarantee against expropriation Separately they could be listed: as
to be needed and will mean plenty and
currency devaluation.
Even follows:
purpose,

as

_

.

of steel.

the ^International Bank for Recon¬

Third, the fact that

at perhaps sion

nt-icrinal

several observations:

most of seven years,

has

aS Xne Original estl- creasing
As a more practical obserA

on

the

have been in the

in

TJ?® outlook is for reasonable

rests

era

for this

rea¬

who have been

.

over

starting to list the

why American companies put

ment may give as reasons for its
point of view that these be thor¬ foreign aid program such things
oughly understood by everyone as "helping underprivileged peo¬
eoneerned.
Possibly those of us ple," "assisting good neighbors,"

year

porate debt is about

neglect the subject which
assigned to me. Of course,

to

rate debt will rise $7.3 billion this

volatile segment
./
The theory that the rise in cor¬

in¬

require

businessman's

the

from

sirable

.

would

private

would

principal purpose of all
countries?
If we knew the an¬
private business investments in
swer, we could better gauge how
the
United
States
or
anywhere
to explain our
position.
There else is to make money. You would
are very basic reasons why Amer¬
be surprised how many peopl£ in
ican money is invested outside this world
apparently do not Un¬
this country, and it is highly de¬ derstand that fact.
Our govern¬

Board, of which Mr. Eric Johnston
and actually decline by pos¬ is
Chairman, held a conference in
sibly $1 billion or more next year. San Francisco on Sept. 24th and
Furthermore, suppose you had
At any rate, it seems that the
foreseen the great changes in the
25th on the subject of "Private
nature of the population and had
great rise in business debts is
Capital Investment in Interna¬
known that the consumers who much ground would be .gained, petering out.
tional Development."
Indications
Except for the Federal issuers, are that similar
would be too old or too young The enemy is showing signs of.
meetings will be
corporate debts are the largest
to be producers would rise 22%, weakness.
,
<
held in other large cities around
while the age group constituting
population increase is ex- segment of the national debt the United States. It so happens
For the past six years
the producing labor force would Pected to continue at a high level, structure.
I attended the San Francisco con¬
increase only 6%. You would have ®ut expansion eras get ahead of the rise of corporate long debt ference
and can report to you that
to $70 billion and corporate short
agreed that greater hourly pro- themselves and must often stop to
strong salesmanship was exerted
to
$93
billion
has
been
ductivity would be required of digest the growth. ..The. excess debt
by government spokesmen in try¬
glutting
the relatively static labor force if Profits tax, which puts a premium largely, responsible for
ing to convince the representa¬
bond
market
and.«keeping tives of American business that
it were to support the enlarged on debt creation and spending in the
consumer group in an ever rising
general, will probably be abol- bank loan officers busy. It has foreign investments are highly
standard
of living.
You would 1£?hed.
The gold stock may not also sparked the general prosper¬ desirable.
«
Corporate short debts are a
have agreed that the machine age Tise' j?u* .one ls an?kle to kbpe ity.
than it had

in

have

Before
J.

which have been made for devel¬

lies
especially
inventory, plant, and equip¬
KonU Mar^
°
by
ment requirements of industry.
I
bad bond markets are likely to
a
;
•
believe farm debt, including farm
go together.
The reverse is true
If even as late as r945 you hadmortgages, probably won't rise
also.
My associates and I expect realized some of these things and
more
than about $300 million in
a change
in the trend of general had foreseen others which were
business conditions and a softendevelop, 1 think you would 1953, as compared with about $1.5

is

expanding
faster
than
the
money
supply.
Traditionally, good business and
an

private

abroad

I

been talking about what
being done in Washington to¬
day. Unfortunately, I am not in
a position
to predict whether or
not this government interest in
private investment abroad will
continue at this same tempo after
the 20th of January.
v:\.

with
capi¬

place

could

is

de¬

hoping to
v-

a

was

I

partments

great credit cycles of

interest

ernment

Are these gov-

advanced

Invest¬

which

participate with private capital on
an equity
basis.
;
To take more time in discussing
the different aspects of this gov¬

that

just why the
topic has sud¬
denly become
so
prominent.

International

an

Corporation,

vestment

ver

the

history.
Look for

tenor

have

rising market

stages and in a declining phase of

a

than

We

on

the

unable

to disco

earn

them

that

are

eiieci

I

been

av

to rise as foreign countries spent

car-

in

of

ment

there

urgent ap¬

an

The personal
over 1 % net to stockhold¬ much lower rate.
ers on it. Suppose you had known savings rate and other demand
that the gold, stock would cease, factors may be large enough, to

is

*

ported to be studying the forma¬
tion

but

changed

to be

While debts are still pil¬

portant.

govern¬

to what seems

of the rate of increase is im¬

tion

our

abroad,

indications

recent

has

years

encouraged private in¬

vestment

compared with

as

several

has

ment

to save. Suppose you had known, $2 billion this year. It also allows
that a stupid tax law would give for $3.5 billion more state, local,
many of the large companies such and authority debt. The decelera¬

ginal
Cherry

For

1950
esti¬
and
next

This estimate for next year
for an $8 billion rise in

Federal

-

debt

The increase in total net
declined from $39 billion in
to $33 billion in 1951, to an
mated $24 billion this year,
may be as low as $16 billion
ing.

even a
small mar-

it

load

ing,

H. S.

abroad, executive of leading farm machinery pro¬
being made,of foreign investment possi¬
bilities and problems. Stresses principal reason why American
companies put capital abroad is "to make money," and holds
this fact should be understood by government and public.
Gives as other reasons: (1) getlingraw materials; (2) attractive profits; and (3) protecting markets open to U. S. manu¬
facturers. Lists requirements for sound foreign investment.
ducer refers to studies

both

in

non-Federal

and

Federal

rise

fresh

efforts to increase private

recent government

on

investment

Invasion

Korean

the

While

stimulated

the end of five years there would
weak.
I would be
a
Korean
Invasion
which
case
differently would superimpose a boom on an

been

is

debt

corporate

•
^

municipal debt up $12 billion. To¬
tal non-Federal debt is up $166

that the bond

say

state

market

and

to

#

Commenting

.billion.

f

easy

■

$78 billion, individual and non¬
corporate debt up '$77 billion, and

classes of bonds inv order to their attractiveness.
It is

while

lion

Says

personal borrowing, which will halt interest rate rise.
^

.

Vice-President, International Harvester Co.

Net

debts.

individual

and

rate

slower rise in corporate debt and downward trend in

ever,

By JACK L. CAMP*

corpo¬

•Federal debt has declined $31 bil¬

Forecasts, how-

and individual debt.

tastic rise in corporate

has
...

basically healthy, but is threatened by fan¬

bond market is

rise in

fantastic

been' the

Made Investments Abroad

and

great inflater of the economy
deflater of the bond market

Laying down principle that interest rates tend to rise
the economy

Why American Companies

_

By HAROLD S. CHERRY*
First Vice-President, Lionel D.

cash surplus is

of government

son

just around the corner.
But government financing has"
not been the principal enemy of
the bond market. Since 1945, the

overexpan-

already threatened

an

in¬

struction

and

Development is re¬

*An address by Mr. Camp at the For¬
eign Investments Session of the 39th Na¬
tional
Foreign Trade Convention, New
.

number

of

Continued

'businesses,
on

page

31

York

City, Nov. 18, 1952.

;(1) Assurance against confisca¬
and
expropriation of the

tion

original investment, accumulated
profits and profits-.put back into
the'business.

Volume 176

Number 5172

.

.

The Commercial and Financial Chronicle

.

(2019)
vestment is liquidated at some fu¬
ture

uate,

tne

money eouid

lars

<.uu

Piease

I

wnen

not

but

wnicii

has
some

it

much

to

fearing

that

change.
rious

property

requirement

discussed,
major

a

it

could

it

and

might

con¬

problem,
become

their

on

at

value

foreign

Actually it is not

as,,

i

here,

governments

be

terrific drain

irom

or

Tnis

foreign

sider

vestment,

mil

the

ousiness

been

tnat

tne original capi¬

sola.

oe

in

was * sent

tne

couiu

to

only

actually

united

tne

io

understand

lexer

tal, - wmcn

local

in

verted tp dol¬

coo

reiuxneu

States.

mean

proceeds

oe

ex¬

as

se¬

them.

to

seem

a

Most of

us who have
large foreign
investments certainly don t expect

to

repatriate

after

they

these

to

be

Actually what is
principle that the
should
of it

be

he

as

(3)

permitted

It

very

expect that

one s

in

to

returns

in

profits.

or

the

This

investments

the United States

or

elsewhere. The term "reasonable,"
course, is subject to a consider¬
able difference of
opinion.
One

of

person

might

annum

to

be

.consider

8%

per

acceptable, while in
opinion 15% would

someone else's

be

thought

"While
of

I

the

group to a
be

credit extended to

foreign country, it

reasonable.

Actually,

and

distributors

ican

foreign jobbers

who

sell

Amer¬

made

Foreign

can

marketing subsidiaries

or

that

presumed

taught

cussions.

ufacturer

could
to

be

that

assurance

increased

higher

costs.

in

It

rates

subsidiaries

A

couple

because

a

pretty
well-known fact that many firms
in
this
category,
which
went
abroad

years

ago

were

satisfactory,

day
of

operating

at

at

government

legal

red

tape,

charging
sistent

rates

with

flation

in

decrease
cies.

firms

It

the
be

which

perience

for

services

value

might have

in¬

beforehand,

the

numerous

and

of

popping

curren¬

imagined that the

have

would

■

.

con¬

tremendous

had

be

this

handicap

facturing

am

is

reduction

analyzed

there

situation

a

are

unforeseen

daily.

up

manufacturers

If

American

to-

are

always
problems
continue

building foreign plants, they will

ex¬

is

brought

about

controls
well

the

and

through
import

United

States,

foreign factories
tain

parts

and

that

materials

and

everything

of

extortion

placed

by

and

investors

dividends

obstacle
ment
*

to

a

criminatory
and

-stable

considered

.

and

local

\

social

summing

up

;

factors

are

like

to

that

repeat

they

in order to

as

to

achieve this end

go

eral

your

make

money,

from

investment

climate

to

and

where

government

and restrictions

are

1,155,730 Shares
tf

COMMONWEALTH

mate.

the politicians and statesmen
.of these countries wanting

foreign
only understood; tne
importance of creating these gen¬
eral conditions, tnere would be

.^investment

no

need for

"

\

EDISON COMPANY

If

<

I

■

cli¬

$1.40 Convertible Preferred
(Cumulative—Par Value $25 Per Share)

■■■■:>,

\

American government

guarantees, such/as those offered
by MSA.
< Inasmuch

;

as

have

we

covered

the theme of
favorable investment,
three

well

in

field

the

and

specific
.this

foreign;

examine

field

and

•whether
able.

the

As

is

of

some

few

a

,

the

31, 1932, subject to adjustment in certain

entering

of

the

re¬

Redemption.;

undoubtedly
in
deciding

initially

investment is advis¬
the

regards

first

group,

cient

quantities

or

in

.

The Preferred Stock will be redeemable in-whole at
from time to time at.the option of the Company,
share and accrued dividends.

per

as a

opinion to the effect that the Preferred Stock qualifies
legal investment for New York State savings banks under provi¬

Banking Law of that State

have

meet domestic

with

which

tain

export
markets
factured goods.
An oil

of

or

they seek is available in a
given country, would first ex¬
amine the general investment cli¬
mate
in .that

country

analyze

now

in force.

writers who

are

.

specific

Harriman

Ripley & Co.

Incorporated

any

time

may

the Prospectus.
be obtained from Under¬

registered dealers in securities in this State.

to

Application has been made for the admission of the Rights
trading on the New York and Midwest Stock Exchanges and for

the

listing thereon of the Preferred Stock

The First Boston

A. G. Becker & Co.

.

-

—

Elyth & Co., Inc.

etc.

nite

labor,

attitude

of

assurance
was

not

be

,

once

Corporation

regulations
the original
judgment one

In my

most

-■

.

,

Merrill

serious

is-where

a

Lehman Brothers

(Incorporated)

.

Lynch, Pierce, Fenner & Beane

Union Securities

Kidder, Peabody & Co.

-

Corporation

Smith, Barney & Co.
White, Weld & Co.

Stone & Webster Securities Corporation
A. C.

Allyn and Company
Incorporated

Bacon, Whipple & Co.

;

-

;William Blair & Company

/ ^

H

.

Alex. Brown & Sons

Clark, Dodge & Co.

the proj¬

changing

proposition.

changes

that

defi¬

rules, and

new

;

par¬

established,, there would

constantly
the

then

unions,

want

of*

firm

is

Hemphill, Noyes & Co.
.

.

'

<J

■

"

-

•

«

1

*■

'
V-,'

„

~
.

,i

.

Hornblower & Weeks

Lee

Higginson Corporation

-

Paine, Webber, Jackson & Curtis

Wertheim & Co.

Dean Witter & Co.

these
first

permitted by a government to de¬
velop the raw material and later
is

forced

to

build

refineries

or

processing plants instead of being
allowed

to export the

its original form.
some

material in

This practice of

governments

has




notice of issuance.

(Incorporated)

Harris, Hall & Company

business, availabil¬

They would also

ect

of

.

that

upon

Central Republic Company

Incorporated

-

Goldman, Sachs & Co.

factors,
facilities,

laws .affecting

ticular type of

ity. of

and

transportation

un¬

Listing.

Glore, Forgan & Co.

other

numerous

as

any

will be within the limits set forth in

offering price at

uct

such

purchase

to

to

main¬
manu¬

mining company, once
having determined that the prod¬
_

certain conditions,

During the subscription period the several Underwriters
publicly offer shares of the Preferred Stock at prices

which

no

demand and

November 24, 1952. The several Underwriters
to

may

longer be
obtained in this
country in suffi¬
can

on

agreed, subject

subscribed shares.

The

an

sions of the

Stock held of record

events.

part

$32.30

at

them with

erals, petroleum and certain for¬

products,

„

Legal Investment.-"' Counsel for the Underwriters have furnished

knowledge that
materials, such as min¬

estry

time

any

common

many raw

„

Conversion Privilege.. The Preferred Stock will be convertible
into Common Stock on a share-for-^hare basis on or after December

investment

for their

reasons

quirements
.which
"have • to ' be
met

it

Business.' The Gompany is a public utility supplying electricity in
Offering.
The Company is offering the holders of its outstanding
Chicago, and its subsidiary. Public Service Company of Northern
Corrtmon Stock the right to subscribe,
prior to 2 P.M., Chicago time,
Illinois, is a public utility supplying electricity and gas in the northern
on December
10, 1952, at $3! per share for the above shares at the
part of Illinois outside of Chicago.*
' *' [ "'•*
'
*
,.' rate of one share of the Preferred Stock for each 12 shares of Common

briefly

generally

climate, it
tov go back to the
American groups most ac¬

be

may

tive

a

undoubt¬

Please send

Name.„„„

me a

copy

of the prospectus relating to $1.40 Convertible Preferred Stock of Commonwealth Edison Company.
Address

most

met*

controls

the least bm*

densome.,

make

.investment

is

lar requirements can best be

America in order to combine these

A

they

attractive, in which their particu¬

cer¬

November 26, 1952

of

so

and

to countries in which the gen¬

New Issue

and

do

principally

Identifying Statement is not an offer io sell these securities. They are subject to the registration and
prospectus requirements of the Federal
Securities Act. Information about the issuer; the securities, and the circumstances
of the .offering is contained in the prospectus which must
be given to the buyer and
may be obtained from such of the several Underwriters as are
registered dealers in securities in this State.

sound

con¬

companies invest abroad, I would

an

few

a

goins

attractive

an

taxes,

and

why American

non-dis-

legislation,

governments

other

up

is

satisfactory invest¬

Reasonable

-labor

.

This

impos¬

limitation

climate.

(4)

the

an

any

the remittance of profits

on

else

having the least

restrictions

these
days, income and excess
profits taxes limit profits in most
countries to a point that makes

sibility. /Therefore,

mother

The fact

.

In

cautious probably do so only in those coun¬
about again
investing in such an tries where government controls with local collateral in making up
enterprise, unless the authorities over private business are kept at a finished machine. Many times
very

father

of

trols.

exchange

require

the

All

government

of these ideas.

number

problem,

licenses

is

may

been

controls.

our own

in those countries

by export licensing from

as

hot in

being equal, will establish plants

long and tedious.
»

know that

manufacturers,

intended .for

serious

*

are

remains, however, that American

a

manu¬

of obtaining such

Another

per¬

foreign nations because

of many

ex¬

sure

firms

on

products

but the process

because

commodities

in

exchange
etc.

to¬

are

duty, "which I

16%

"

government

has

Mexico

ago

shipment
outside
that
country.
manufacture,
high import duties, This export tax can be reduced
restriction, embargoes, in the case of certain commodities,

time when

loss

years

of

My company's experience has
taught us much about manufac¬
turing in foreign countries, and I
competition
or can tell you that it is no picnic.
which prohibits Regardless of how carefully you
a

a

the

can

have

of

at

scorn

option about in¬

law 'leveling a

a

of

dol¬

position to point the finger of

a

us

passed

or

small

a

*

man¬

regardless

for

We, in this country,

been forced to local

proportion

is

branches

and

no

" Wages

down

impossibility

needed in its operation.

whether his business is profitable.

terrific

want

has

exchange

of

port

by
selling to independent importers.
In
many cases
these marketing

profitable vol¬
consumption. They would

lar

4 of

creasing

dustry to permit

a

week in 1952. A

per

the

centage of the things that factory

week in 1939 to 10 pounds 12

shilling

of

7

factories

entirely closed

obtaining import licenses

example, because of

-

per

large

years

been

because

a

among
the" branches generally result from the
things they would look for would belief that
better
participation
be sufficient population and in¬ could thus
be achieved than
of

For

recent

have

law in Australia requiring wage
adjustments every three months,
the basic wage in that country
firms usually start in the form of has risen from 4 pounds 2 shilling

goods. Such credit is
in itself an investment on the part
familiar with all of the
manufacturer, the exporter
which attract this or the banker, as the case may be.

things

in

though they may be well interttioned, have far reaching reper¬

not

am

because experience
that controls, even

has.,

and

profits

whether such

made

are

dispose

investments will

reasonable

true

to

fundamental

form of dividends
is

the

fit.

sees

is

yield

is

minerals

minimum,

a

onstrated understanding and good

You will remember that we in¬
cluded in the second
group trans¬
portation and utility companies.

also

of capital

particular country have dem¬

a

will.

interests of its people.

most

involved

of

it is economic and to the best

not

and

owner

and

-

ume

permanent.

expensive

very

Quite naturally, I am more fa¬
forestry miliar with the third
group
of
products. Apparently these days,
foreign investors, namely: manu¬
every
country
wants
to
be
a
facturers, such as my own com¬
manufacturing power whether or
pany. Investments made by these

troleum,

time

larger firms consider their foreign
investments

been

um>aasiactory
to
companies en¬
gaged in producing abroad rubber,
vegetable
fiber
and" oil,
pe¬

short

a

made,

are

edly

Commercial and Financial Chronicle... Thursday,

The
m

November 27,1952

(2020)

100 Broadway, New

poration,
is

Dealer-Broker Investment

Co., 50 Broadway, New

Recommendations & Literature
send interested parties

to

Cement Co.

Riverside

Chains

Knowles &

available

Co., 330

is special

—

currencies

Gas

Western

55

Company,

Issues—Analysis of their future—Francis I.

Low Priced
&
Oil

Co., 1 Wall Street, New York 5, N. Y.
Companies

legislation affecting the off-the-coasts

Wall

yield

and

York 4,

market

over-the-counter industrial stocks

performance

Front

46

of

ner

be the forerun¬
entirely different ap-

an

period-

13-year

a

over

Inc.,

Bureau,

proach to new issue advertising is
being used by

New

Glore, Forgan

Street,

Co. and The

&

New York.

,

First

Railroad Securities—Bulletin—Vilas &

Hickey, 49, Wall Street,

Boston

Corp. and

New York 5, N. Y.

as-

sociates

Building, Detroit 26, Mich.

Equipment Corporation—Analysis—McLaughlin, Reuss &

Co., 1 Wall Street, Netf York 5, N. Y.<

-

change Building, Seattle 4, Wash.
Carborundum

'
Co., Ex¬

Jas.

of

Shearson, Hammill & Co., 14 Wall Street, New York 5, N. Y.
are

memoranda

on

Interchemical

Corp.

Co.

—

Locmis, Petersen,

Profit

Sharing

For

Retirement

Pierce, Fenner &

of

E. I. du Pont de Nemours &

Co.—Memorandum—Smith, Barney

Co., 14 Wall Street, New York 5, N. Y.
on

which

Department

based

2

at

after

Dec.

companies

predecessor

have been

paid since 1890 and

currently

at

$1.80

the

Co.,

Also available is

an

added

be

to

ultimate

of

ish wishes.

working capital

application

for

during the four-

Calling for

period 1953-1956.

billion

one-half

approximately

of

expenditures

dollars, the

National

pany,

Bank

Gair

Co.

of

Akron—Analysis—McDonald & Com¬

Radio

advertising of

—

Memorandum

—

Cruttenden

&

Valley

Corporation—Revised

209

leaving

nancing,

Railroad—Analysis—Oppenheimer

to

Principal projects of the
call for the installation

now

will

help investors to de¬

*

a

combined generating capacity of

840,000
crease

/

Commonwealth

Edison

Identifying Statement makes
•

&

Co.,

25

of

the

cludes

kilowatts which will in¬
the system's

900,000 kw.
..

of

ture

opportunity and

in¬

utility

public

na¬

tricity

the
areas

company's

business

in which it operates,

the

on

conversion

..V '

<

in

sidiary, Public
of

Northern

•ration

nois outside of

-^status

of the stock

as

the

a-legal in¬

vestment, facts about the offering,

Perpetual Warrants
Purchase Common
at

$3.75

and

price of security,

information

its

about

as

well

listing

as

on

securities exchanges."

Troster, Singer & Co.
Y.

Security Dealers Association

Trinity Place, New York 6, N. Y.

of

Company

Commonwealth

$1.40

ferred

stock,

share,

are

company's

Edison

convertible

par

being

value
offered

common

pre¬

-

•

<

i

will

the

Club

University

Boston

be held

at

Wednes¬

on

Wallace

day, Dec. 10, at 5:30 p.m.

Strathern, director of training for

will

&

Gas

Eastern

be

Associates

Fuel

Some

speaker.

principal

a

.

elec¬

and its

sub¬

Service Company
is

a

bined service

public

electricity

Chicago. The

area

totals

and

com¬

approxi¬

mately 11,000 square miles having
an

estimated

600,000.

ues

of

5,-

For the 12 months ended

30,

of

population

1952,

operating

$298,225,000 were

$25

per

the

to

the

net

similar

period,

derived

sales.

to

Second Annual Dinner
Investment

•/ The
New

will

York

Association

hold

annual *;• dinner / at

its

of

second

Waldorf-

the

Majot

General William J. Donovan will
be Guest

of Honor and will dis¬

the

cuss

Free

World's

Fight

'

Against Communism.
Investment -Association

The

New York is a group

mately 300
investment
age

younger

banking

of

of approxi¬
men

and

in the
broker¬

business carrying on an in¬

tensive

program

of education

in

New York

cooperation with The
Stock Exchange.

With Francis I. Du Pont
CHICAGO, 111.

—

Francis L

For du Pont & Co., 208 South La Salle

consolidated

income before preferred

stockholders idends amounted

N. Y. Inv. Ass'n to Hold

reven¬

to the extent of 87% from electric
sales and 13% from gas

planned.

■

is

in the northern part of Illi¬

Sept.

Rights to subscribe to 1,155,730
shares

the

of

Club

:! * ' Astoria./Hotels pn Dec. 4.

•: supplying

supplying

utility

provisions

redemption,

'

Illinois,

gas

for

-

Chicago,

privilege of - the preferred stock,

Primary Trading Market in-

capacity to 3,-

-

•

Commonwealth Edison Co.

use

statement about the

new
a

fi¬

additional

generating units with

new

termine their interest in the pro¬

"The

from

provided

of six

pertinent information

information




balance

program

and the

Members: N.

the

nancing.

Bruce

-

Broad Street, New York 4, N. Y.

74

1952,

present in brief

can

party

informal entertainment is also

posed security offering.

report—Conrad,

;'/.//.* V' .'.V-V-V'

;

to

and

sources

the SEC, under¬

rule by

new

Christmas

Investment

Parly

The annual

—

including the proceeds of this fi¬

i

,14, Calif. v;V

internal

from

fi¬

be

be

which

Co.,

Co., of Los Angeles, 530 West Sixth Street, Los Angeles

Lehigh

will

funds in hand at the end of

SEC

securities

new

simply named the issue and

form certain

South La Salle Street, Chicago 4, 111.
Hoffman

000

writers

Union Commerce Building, Cleveland 14, Ohio.

(Robert)

the extent of $220,000-

Corp., said:

Christmas
BOSTON, Mass.

con¬

nanced to

James

Boston Inv. Club

the

toward

additions to the util¬

subsidiaries

its

year

all work for the New Administra¬

financing will

stated the price. With adoption of

analysis

depression which followed.

the nation ahead of our own self¬

share.

per

the

Broadway, New York 4, N. Y.

em¬

tion and willingly put the good of

program

issues

50

government

of

annual rate

Proceeds from the

clearance of

advertisement,

Boston

of

ployees. This will cause unem¬
ployment. President Hoover tried
it. It started his collapse and the

are

struction

type

is increasing.1 Taxes

employment
discharges

and

on

clean house and
Washington;
but every government employee
has many Congressional friends
who will beg Ike to retain these
friends—especially if general un¬
increase efficiency at

period

on

stock

Inefficiency
Ike will try to

v

cannot be decreased without mass

principal

offering by the SEC.

most

&

fight

we

31,

on

use

"Before this action by the

Company—Analysis—Ira Haupt & Co.,

Stores—Analysis—Dreyfus

unless

at the close

issue

Coggeshall, Jr., President of The

of Convertible Bonds

!

24,

purchase from
unsubscribed

the

subscription

(CST)

common

comprehensive Identifying

new

Broadway, New York 6, N. Y.

Federated

,

will

of the

the

p.m.

Discussing the advantages of the

Also available is

Great Plains Development Co. of Canada,

El Paso Electric Power

,

Nov.

First

memorandum

&

on

cost of gross

the

Ltd.

.

common

Dec. 10, 1952. /
The new preferred stock will
be convertible into the company's

un¬

regulations of the Se¬

Statement following

Beane, 70 Pine Street, New York 5, N. Y.

First

of

ity properties of the company and

a

Ill

at

regarding advertising of securities

Income—Booklet—

Pension Fund Department, Merrill Lynch,

a

share

per

offerings, marks the first

Deferred

1954

ber, 1954.

Forgan & Co. and
Corp. head a na¬

company

balance

curities and Exchange Commission

Noyes & Hemenway, 231 South La Salle Street, Chicago 4, 111.

&

the

Common¬

advertisement,

the revised

Memorandum

—

$31
shares

Glore,

firms

securities, the Commonwealth

Edison

and

International Paper Co.

Cluett, Peabody &

in

will not be definite until Novem¬

share of preferred

of record

held

1952.

the

Chicago, Rock Island & Pacific Railroad Co.—Memorandum—.

available

Congressional

the

lose

for him from now on. His election

tion-wide group of 158 investment

Representing a departure from
customary "tombstone" type
of advertisement which long has
been associated with the offering

& Co., 63

Wall Street, New York 5, N. Y.

Also

Coggeshall, Jr.

'

Company—Analysis—John H. Lewis

Congress¬

many

1952, on a share for share
Headache No. 11—Religion >■■■;•
wealth Edison basis, and will be redeemable at
Ike well
says
that America's
Co. of 1,155,- the company's option initially at
730 additional $32.50 per share scaling down to greatest need is for a spiritual
shares of the $31 per share on and after Nov. 1, awakening; but thus far in the
"hard
times" have
plus
accrued
dividends. past /only
utility's con¬ 1964,
vertible
pre¬ Quarterly cash dividends on the brought such about. This, how¬
ferred
stock, company's stock and that of its
ever, may not be necessary if we

memorandum—Baker, Simonds & Co.,

Bank of California—Memorandum—Pacific Northwest

too

only of themselves,
rather than the nation's good. Ike

The First Boston

shareholders
of

of
one

each' 12

stock

of
offering to

an

New York 6, N. Y.

Buhl

for

derwriting

Allis-Chalmers—Analysis—E. F. Hutton & Company, 61 Broad¬

Aro

the

price

a

the rate of

nection

con

way,

at

in

with

Alma Trailer Co.—Card

But

think

Headache No. 10—Corruption and

of securities advertise¬

ment which may

Quotation Bureau Averages, both as to

.Quotation

1928.

men

Street, New York 5, N. Y.

A form

parison between the listed industrial stocks used in the Dow-

National

Wisconsin Public Service Corporation.

Corporation—Bulletin—H. E. Herrman & Cohen, 14

"Identifying Statement"
Published on Commonwealth Ed. Co. Offering

up-to-date com¬

Ike must have

friendly Congress. He will start
with one as did Herbert Hoover

a

First Post-Effective

tidelands—Greene and

Over-the-Counter Index—Folder showing an

used in the National

For real progress

Also available is an illustrated

could

Company, 37 Wall Street, New York 5, N. Y.

Jones Averages and the 35

Headache No. 9-—Congress

Elections

benefit from new

be wrong*

bankers may

Reading Company.

come in 1953
However,
these

will

1954.

and/or

.

Study of those likely to

—

duPont

millions of people—as
— a
headache. Most
believe that such declin¬

markets

ing

Company—Analysis—White, Weld & Co., 40 Wall

on

Wilcox Oil

de¬

Ike

as

bankers

Great

in

Co., Talcott Building, Rockford, 111.

steadily

a

give

well

Island & Pacific, Norfolk

Chicago, Rock

Street, New York 5, N. Y.
booklet

Chicago,

Railway,

Ohio

&

Western Railway, and

Torrington

Stocks—Discussion—S. A. Sandeen &

Utility

Railway,

&

will

Also in the same bulletin are dis¬

Chesapeake

of

President.

new

8—Stock Market

clining stock market, commodity
market
and real estate market

Kansas City 6, Mo.

Street, New York 5, N. Y.

Street, New York 15, N. Y.

Electric

&

Trust

Manufacturers

Department,

Foreign
Broad

various

of

10 Post Office Square, Boston 8,

No.

Headache

Milling—Report—Uhlmann & Latshaw, 111 West

cussions

listing 144 quotations of
countries throughout the world—

behind our

stand

Railway—Analysis—Eastman, Dillon & Co., 15 Broad

Southern

Foreign Exchange Quotations—Folder
the

York 4, N. Y.

Unfortunately,

Russell-Miller

Ross,
Bay Street, Toronto 1, Ont., Canada. Also
review of Dominion Stores Limited.
Canada

Analysis of the industry in

—

problem will be a real head¬
ache, but here " again we must

this

Mass.

10th Street,
Food

Stout &

—Analysis and review of the Cement

Industry—Lerner & Co.,

mentioned will be pleased
the following literature:

that the firms

It it understood

& King, Libaire,

Airlines—Analysis—Eisele

5

Ike's Headaches

Light Co.

memorandum on Duquesne

a

Resort

Continued from page

Company—Analysis—The First Boston Cor¬
York 5, N Y. Also available

Maryland Casualty

div¬

$33,066,000.

Street,
ward

have announced that Ed¬
Flannigan

sociated with

has

them.,

become
'

as¬

Volume 176

Number 5172

...

The Commercial and Financial Chronicle

(2021)
it

Reducing You Investing Risks
By G. M. LOEB*

was

moving higher. Well, if it

stopped moving, I'd take my loss.
Most people here would
buy a
stock because it's
paying a good
dividend

Partner, E. F. Hutton & Co., Members N. Y. Stock
Exchange

thought

Market expert cites

following risks to be avoided: (1) victim¬
izing by promoter, (2) salesman high-pressuring, (3)
paying
over
exchange market price, (4) over-trading, (5) buying more
than

one can
safely finance, (6) listening to too many people,
(7) buying the wrong issue or the wrong industry, (8)
buying
at wrong time,
(9) incorrect information, (10) failing to notice
balance sheet weakness, (11)
underestimating general market
situation, (12) unexpected news, and (13) effects of inflation.
Stresses importance of
planning before buying, including
setting of maximum loss to be taken.

The

title

of

this

talk

is

"Re¬

investing probably

ducing Your Risks." 1 don't know

and

important subject. There
is an old saying that
goes some¬
thing about

any more

then

the

care

them¬

selves," and I
think that that
is perhaps one
of

the

most

correct

ings

say¬

that

has

other

vestment.
A

as

a

sub-title,

given

to

a

me

subject,

is termed "The

G.

M. Loeb

Calculated
>

the

versus

duties

willing to take

is not

or

can

much

he

no

just
an

and

lose.

can

Of

exact way of

sort

a

of

apprasial

an

is

nothing at all. You

how

course,

knowing.
appraisal,

better

can

than

through
the stock lists and take
positions
and think,
"Well, I can lose so
much and make

can

make

go

much, and it's

so

that

very necessary
you

any
much of

feel that

you

considerably

than you can lose. In other

if the

odds

aren't

in

your

more

words,
favor,

you haven't very much chance to

tion

versus

comes

to specula¬

gambling, I don't think

that calls for much comment be¬
cause

anyone who gambles in the

investing and there is a
difference there because the
spe¬

culator, the successful speculator,
tries to buy a stock at a
cheap
price

at

or

considered

low price before it's

a

investment by most
people. In other words, they buy
an

issue that people don't think
has much merit or where
they feel
some

the
it

dividend

isn't

they

isn't

paying

hope

one

safe

where

or

dividend.

a

two

or

or

Then
three

years
later to sell it to people
"make," I mean after its status has been raised and
might make from an it has become an investment. In
advance in the price of a stock my
opinion, intelligent specula¬
plus what you might make from tion is very much safer than what
any dividends you might collect I think most
people mean when

it—everything that they talk about investment.

in, less taxes. And when I
say what you might lose, it is of
course
always a market loss. It
comes

do

stock for

much

5%

a

good

or

6%

to

buy

a

return and

hold it

a couple of
years and have
drop 2 or 3 times the amount

it
of

dividends

collected.

In any

is

such

stock

thing as
selling at
a

it

Now

speaking about losses, I
everybody here knows
they are only partly deductible, taxwise, as far as regular in¬

suppose

that

is

come

concerned.

You're

till

is

That

about
as

what

covers

to the general

listed

on

cards but

a

rities

business,

through

professional advisor

the other

On

before I

secu¬

which a
be un¬

may

being
be

a

of

a

And

stocks

that

all

and

you

can

are

those

you can try to

have

back

at all the

their

near

stocks

technical pressure

may

look

this

them. Then

on

pick out those that

some

reason

to

come

in

been

a

It might be a

stockbroker,

less.

broker

two

schools

"trading
lation

I

have

I'm

tagged

as

and

I

I'm

the

The

hope

gambling

believe

question

It

in
an

the

man

are

says,

the
idea

trading

not

tagged
because I

in

gambling at all.
of trading versus

♦Transcript of extemporaneous remarks
by Mr. Loeb before the Federation of
Women Shareholders in American Busi¬
ness,

think

the

gets
the

on

the

with

same

New

does

one

whole
York

a

com¬

Stock

than with a salesman
who gets a varying commission.
Risk of Paying Over Market Price
The

the

next

risk

market

that's

price.

risk

a

is

in

paying
I

don't

New

securities

seen

the

price
exchange. I've

sold

City,
City, I've

for way

was
seen

think

York

but outside of New York
what

over

on

the

over

stock

son

buy, this is
been

good sale and there's

many cooks spoiling the
that it was just impossible

broth
to

a

so

know where they were at.
was to confuse them.

Now the next

risk, of

fundamental—buying

is
selling at

course,

or

the wrong time. Of course
any of
us who know the
right time would

have the key to becoming million¬
aires
a

right

book

You

away.

on

this

To

which

Inc., New York City, Nov. 17, 1952.




anything

that

take

loss when

that

a

the

so

best

selling
can

at

say

the right time.
All I
about that is that for the

do it
it

on

the basis of

looks

cause

high

one

hand.

In

1929,

stocks that

sold

saying, "Well,
low," be¬

looks

or

never

knows

there
at 200

a

as to

on

and

the

was

trading,
a

stock

moving

up

system

something

you

see

stocks that start at 10

or

20 and

they go to 35 and they look
high, but they might go to 75 or
100

so

the

answer

answer, of course,

people out of slant
bond for $950

each December 16, 1953

to

isn't there.

is having

a

The

good

J*

1967, inclusive

Railway Company

Priced

to

yield 2.20%

to

3.05%, according to maturity

Issuance and sale of these Certificates are subject to authorization by the Interstate Commerce Commission.
The

Offering Circular may be obtained in any State in which this announcement is circulatedfrom only
such of the undersigned and other dealers as may lawfully offer these securities in such State.

HALSEY, STUART & CO. INC.
R. W. PRESSPRICH

A. G. BECKER

is

to

CO.

L. F. ROTHSCHILD

FREEMAN

&,

COMPANY

IRA

thought

& CO.

HAUPT &

CO.

INCORPORATED

,

HAYDEN, MILLER
'

& CO.

THE

ILLINOIS COMPANY

GREGORY

&. SON

INCORPORATED

'"M»

McMASTER

WILLIAM

HUTCHINSON & CO.

BLAIR &. COMPANY

you;

simply because it
you

&,

& CO.

occurs

supposing

and

good
when

they went to 100, they looked low
and then they went to
$6 or $7 a
share. Going the other
direction,

payment of par value and dividends by endorsement by

Northern Pacific

arbitrary. I

alters your reasons for
buy¬

bought

before¬

were

Equipment Trust Certificates

unconditionally

various

ing it. In other words, going back*
to

fact,

was

$425,000 annually

mature

To be guaranteed

buy, if it goes down three
points, take the loss. I* don't be¬
in

In

inexperienced person, there is a
certain
safety
in
not
buying
everything all at once. You can't

lot of different
ways

think

write

can

subject.

there have been many books writ¬
ten on the subject of buying and

(Philadelphia Plan)

"always
Anything

lieve

All

it did

you

market."

that

as

a

that.

gambling

thought.

man

don't

are

doing

investing," "specu¬

versus

stock

who

I

Exchange

278% Serial

and yet it would
good investment.

I've seen
textbooks which often
say
take a three point loss."

of

versus

on

a
great many customers
into my office and this
per¬
has told them this is a
good

mar¬

that taking losses
key to reducing risks and
personally,
I
think
for
most
people, a little planning before
they buy something as to-how
much risk they want to
run, or

of

them

I've had

come

the

There

The program says that there

that he's

Railway
Equipment Trust of 1952

January or February of
next year when the tax selling is
over. You have a good risk
there, how much loss they want to take,
because the chances of them going makes
quite a lot of sense, and I
down after the tax selling is lifted think
it
works
out
very
well.
is

see

victim of it.

Northern Pacific

Now I think

is

to the customer to

$6,375,000

Take Losses to Reduce Risks

lows

with

speculation

have

reason

pretty well

ket and it might have been called

tax selling. That will go on
right until the last day of Decem¬

up

not the

at
things, and not doing
$1,000
everything all at once.
selling for $850 on the
Now the next risk is
stock
a banker,
buying
exchange.
a friend who is a suc¬
Anybody who
the wrong issue or the
cessful investor.
wrong in¬
Sometimes they buyst a stock ought to look and
see
that they're paying the right dustry. Strangely enough, that is
go to two or three people for ad¬
vice. Then very often if one per¬ price and if they deal with a rep¬ a much lesser risk than the one
of buying at the
son tells them to
wrong time. I
buy a stock and utable broker, they will.
just think the most expert people
it goes up, and another person
The
next
risk
is
against the
tells them to buy a stock and it stock
Continued on page 28
broker—overtrading—which

advice.

hand,'you might

low point in the

a

a

the

speculative

the end of the year, a great
many
stocks are under pressure because

quality at

sell

someone

Perhaps I'm prejudiced,
stock broker, which may

fairly
judged.
Naturally, most
everybody goes to somebody for town buy

you

it.

subject.

peculiarity, I think of the

have

had

get into those, I want to mention

price. General Electric, for in¬
stance, as far back as I can re¬
member, has been an investment
stock, but if you bought it in 1929,
you paid a speculative price for
it, so if you call it an investment
when

I

about 20 different kinds of

risks

to

you.

only mission

allowed $1,000 a year against your
regular income for five years.

have bought a stock of much less

ber.

Well,

customer to buy

a

unnecessarily just for the
sake of making a commission.
It's

investment

lose.

now

two.

a

bought it, •you were
probably putting the wrong tag on

instance, from

the

getting

and sell

There

an

event, every stock pur¬
chase ought to be considered from
the standpoint of what you
might
For

of

familiar

versus

you

doesn't

advisor

the fact is that the element of risk
has to be considered. It
may

individually, and

wasn't

going to lose their money. So the
in mind
real difference here is
speculation I
have

Now when I say

while you own

was

works.

begin with.
what

better

means

going
very
The next risk is the risk of
to be raised. They might buy be¬ well have been that the
buy¬
purchase ing more than
you can safely fi¬
cause they felt that
of the stock that went up involved
earnings were
nance.
Well, of course, in the old
going to be larger. Another reason six or eight or 10 chances out of
days, margins as we call them
might be their idea that a stock 11 or 12 of losing and the one that
were fixed
by the houses and all
was
going to gain in investment went down might have been a
they were interested in was to see
stature. Stocks bought for reasons much safer situation even
though that
they
wouldn't
lose
any
such as this should not
necessarily it resulted in a loss. I think that
money, but now the Federal Gov¬
be sold just because
they tem¬ is
something
someone
should
ernment tells you how much
you
porarily run against one. If an think about very carefully in try¬ can
borrow and things are on a
objective valuation suggests that ing to decide who's giving them
much
safer
basis, but just the
advice
and
who's
nothing is changed and that the good
giving same, I think that
buying on mar¬
original premises still hold good, them bad advice.
gin or buying on credit or buying
Now I didn't write these risks
one should wait and give the stock
on borrowed
money is something
down in order, but just as
a chance to come back. If
you find
they for the
expert rather than for most
out you're wrong, and the
picture occur to me. The first risk of los¬ of us.
has changed, then the quicker you ing comes from being the victim
The next risk is a peculiar one
of a promoter.
take the loss, the better.
There is nobody
—listening to too many people.
here who has to be the victim of

could have done

Speculation Versus Gambling
Now when it

are

doing very

make

you

you

there's
but

make

can

trading. I think

investing. I think you stock market, using the dictionary
investing by judging how explanation of the word, is just

much

dividend

they

to

scientific
start

It's

in

success

this auditorium.

how much she

or

days, and later weeks,

Involuntary and Un¬

necessary
Risk."
Anyone
who
takes involuntary or
unnecessary
risk without
knowing how much
it is

term,

hours, and

because

is the

up

many of them I
moter and the salesman is that
with, and yet I
the promoter might take all your
you
pretty good job
have to look at the stock
money or 75% or 50% and a sales¬
by
selling the
ones
that
tape just
man might
take what you might
from 10 o'clock to 3:30 o'clock showed
losses
and
keeping the
call legal rates. It is much better
every day, so I don't think it's ones that showed profits. It's not
to be a buyer of a
security than
really a matter of discussion in a scientific approach and yet it

to do v/ith in¬

•

buying

short

few

a

the

or

who told them to

one

buy the stock that went

now I think most
people be¬
In all the thousands and thou¬
a promoter.
lieve that any stock that is
Anybody ought to be
bought sands of accounts that I've looked
able
to
recognize a promoter—
and sold inside of six months
and at in the 30-odd
years I've been someone
is a short term
that, offers something
capital gain is in the brokerage business, I think
brand new, something that is not
trading. That is because of the less the biggest mistake has been a
listed, something that promises $10
active markets that
we've had. lack of willingness to take losses.
or $100 for
$1. I think that type
Investing, I imagine, in most In fact, I've looked at a lot of
of thing ought to be
completely
people's
minds,
means
-buying portfolios with 20 or 30 stocks that ruled out.
something they think is safe for people say "Shall I buy this, sell
The second risk is a risk of be¬
the dividend return.
Trading is this, what shall I do." I couldn't
something for the professional. I possibly look up each of the stocks ing high-pressured by a salesman.
The difference between the pro¬
don't think
anybody who has

profits

.of

few

a

be

means

the

and

losses,

•will take

for

this used to

."If you watch
your

selling

return

down, they take it for grant¬

goes

ed that the

9

November 21, 1952.

WM. E. POLLOCK & CO., INC.
FIRST OF

MICHIGAN

CORPORATION

The Commercial and
10

'

I

||

—^

111 hal

HA

2121

■

va&l

VVnal

Thursday, November 27,1932

...

cation between them, these two governments must heed. Too little let us look at the United Kingdom
factors, both beyond Britain's con- attention has been paid to en- and : some countries in Latin
trol, have together involved a couraging domestic savings in
.
T believe th->t it te in thp

,

Ah All I
nifWUft

filAflA
WUv

I*V

'

*

.

a

/

¥

..

njrAn***-v

i

Monetary Fund

Director, International

.action

Asserting solution of the
ym
continuation of U. S. aid, International Monetary fund execu„

exclusively

not

is

materials

raw

ward

as

areas

wide solution.
,

.

lem

ment and

M

interest

interest

it

®

Monetary

the

of

member
and

Fund,

the

Peace,

essential

is

to

pr0^p^r^y' and. *be S0CiaJ and

The Fund

interest

s

views

shall

^

^

eon

on

™ietf fCUhn??nnpS'
oaiance

billion

.4

un„„

,

meej. the prohlem. In

a

1947, the

transactions.

service

aid

worm.

.

Some countries m Latin Amerin substantial
in

ica

■

arrears

are

.

will

was

u'was abwt'$2'bUlion ShiPmen'S'

and make it
,

difficult for the coun-

imnnrts;

Th_„p

imports. These

Inflation

may

ExP°rters add a large pre-

world markets, mium in the prices they charge to
reduce home cover interest and risk. Foreign

try to compete in

even

European employment opportunities by cut- investment in such countries is
is not a temporary ting off the means of payment for alcQ discoura£ed and th :
phenomenon. It reflects a real.im- raw materials. Fortunately, many
"...
,
provement in the whole economic countries are now aware of the nomic ; development
is slowed
environment of Western Europe, fact that a sound financial policy down.
Industrial production in Western is an indispensable condition for
Many of these countries are
Europe is between 40 and 50% a strong payments position and
.
greater than in 1947.1 believe that continuing high-level employment.
s
ng ways
1+ r«rmia ho inrrpacpH fnrthpr
anH The reeent. imnrovement in the houses in order?- This can not be
it could be increased further, and The recent improvement in the houses in order.--This can not be
without the addition of new capi-" payments positions of certain Eu- done by setting up new machinery
improvement in

payments

ek

munerating

of-Putting their

inten- ropean countries is largely at- and devising new gadgets." It can
tech- tributableto the renewed empha- be d
Qn
sis on credit policy.

toward incentive systems for re-

States, the

•

pay g 0

niques and perhaps a further shift

mentg from the United

th

f

goods and

are

indications

The

in

also spill over into larger countries pay a heavy price for
imports than the country can pay this delay and uncertainty in reIn
1951, for. If the inflation persists, it will mitting for their current obligashinments
unbalance the structure of prces

Europe
on

lhat> excluding military aid ship-

payments

01

,

unpleasant
it The

solve

to

great deai has been done

billion.

navLnk

nf

persistent

,

Western

more

world's dollar deficit on goods and tal equipment, by the more
service transactions was almost sive application ot known

weavPo( reSorinea
Sfvmenti system based on conpayments svst^ haled
the

in

try
.

.

the dollar probsolved, there is

taking

for
to

measures

principally to the most

afternoon

as

be

not

will

reason

world trade and payments.
direct my lemarks this
remarks

govern
I

that

policies

exchange

^at

m-stg gay
lem

the

Qf

$5%

Tbe

that

and

70%

Improvement Is Progressive

extreme

unjustified

are

and

6{)

militarv

positive harm. The pessi-

primarily

is

goods from export markets. It

011

these

that

believe

{

political stability ot the world.

and

-

Causes of
Payments Problem
View

demand will be used to bid away

now

about

;
The Correct

competing

in

producers

and financiers

than

are

defidt

surplus country, decline to take
effective steps to solve it.

it is in
of
every

its

sterling the traders and financiers

.

before the war. In 1947, the dollar

thp

Anrj

ahr.npH

businessmen,

as

national

the

.

.

mote inflation.

eign loans or assistance, the excess

tween

to in vest abroad. And the
conclusion is that the dlolliar p ? "

expanding the volume ot
in your

in

.

volume by 80% in
igj by an amount

exporting be-

countries

lem will persist because

world's trade. This is

the

full employ-

cans

Foreign

Trade Council share a common interest

on

WQrld markets> With inconvertible

that

__

Norway and Denmark was below home market or from imports fithe 1937 volume. These same nanced by current exports or for-

™full pmnlnv

emphasis
.

t a r y

o rt e

National

the

and

;„rrPa4<wi

amnk,c;.

excess

,

__

.

International

The

of

higher prices which must be paid
exceeded times been pushed so far that they in inconvertible sterling raise the

In much the same way European
It is now generally recognized sterling, the traders
countries have met a considerable that inflation tends to result m of the United Kingdom cannot
Qf thg payments problem. In payment deficits.
When demand fully perform their customary role
1947^ the • voiume 0f exoorts of is inflated beyond what can be
merchants and bankers to the
France, Belgium, the Netherlands, met by current production for the

rapid development. Urges more U. b. imports.

.

Fund

f

.

The

increased signed to achieve them have some-

an

$3 k billion.

production and economic improvement in backindication problem may be approaching worldContends persistence of dollar payments prob-

natural consequence

is

in

the

of

sterling.

of

valued at over £1,200 million, or objectives themselves, as to pro-

-

roints to increased

dollar problem,

a

for the restoration

work

cost of its imports and handicap

prewar

1951

expresses

and it

-

America, l oeiieve tnet it is m the
interest of the United Kingdom to

have served, not so much to contribute to the attainment of the

the

,

belief progress is being made toward its solution, since there is a steady improvement m European exchange
nn«ihnn
Droblem is not confined to Europe,
position. HnlrL paymc
Holds navments p

tive,

found

is

volume of exports. These

Problem rannnl hp found in

pa„m^tc

»•

material

producing countries. The objeetives of full employment and eco-

be-

What has Britain done to face nomic development are good in convertibility
this problem? Its most significant themselves, but the policies de-

ROOTH*

IVAlt

Rv

Managing

$4 billion, in its payments
tween 1938 and 1951.•
over

Payments Problem

The

either industrial or raw

million, or

deterioration of £ 1,500

*

Financial Chronicle

(2022)

...

.

..

tl0nal and international policies,
The International Monetary Fund

in the raw materials exporting

labor. The structure countries, the policy of rapid de-

dollar deficit in 1952 will be about of prices in Europe is also more * velopment has often been sup- will make its resources available
rMt nf thp wnrltf
Th i
n r obi em
W* billion.
And the import competitive now than it was five, ported, by inflationary finance, when necessarv to member rounEf.
^
^
restrictions in deficit countries are years ago. due principally to the which here also has had the effect
ihe SXfl
neriodbv extremelv now considerably less severe than 1949 devaluations. And now, mon0f attracting resources to home
Pursuing
«£nJrn?,J oiJ f 1 thp initprf they were in 1947. It should not fetary policy in most European markets and discouraging exports.
National policy in all countries
StaterOovernment esneciallv to be expected/of course, that the countries is better directed^ toward The supply of foodstuffs and raw must start with eliminating and
tWP
rinntrteS^ which suffered goods and service gap will be avoiding inflation and restoring a materials for export from non-dol- avoiding inflation through ^tron^
severely h/the war and are now completely closed, as part of it is
balanced payments structure,lar regions has generally not inVonnpraling in the restoration of more or less permanently covered'
So far, I have spoken of the creased commensurately with de# s
Obviousthpppnnnmif qtrnetiire of the Free
by capital
outflow from the world payments problem as if it mand. Sometimes it has not ly, this is not consistent with the
World It is clear however that United States plus private dona- were a European dollar problem, increased
at all. On the other extreme view that there must not
the solution to the problem'can- tio"s: Moreover, a substantial pro- In tact, the payments problem is hand, with increased production be any unemployment at any time
he fniinH
in
fhe ennfinn-finn
pmhon of the remaining deficit not confined to Europe. Nor is it in the United States and Canada, .
+, ^
^
United
Stntes aid
This aid is is attributable
to increased de- exclusively a dollar problem. My the dependence on dollar sources
y
economy.

?hZ] n^rcicw

HpfiHt

nf thP

<?

aiy t0 me™ber counsuch policies.

JT11
trles

~"g

^

at

best

scaffolding

a

assist in

to

the erection of a permanent structure. Let

then what has al-

see

us

ready been done in the erection of
this structure and what tasks still
lie before

us

ininn-

SS

nn

one

an

w

ex

that

attitude

no

the

cite

this view

who take

Those

that

fact

States

United

for about twice.
much exports from the United

imports
States

pay

now

the

before

as

Under

war.

circumstances,

such

deficit

the

countries ought to be able to earn

enough dollars, directly and indirectly, to pay for a volume of imports suited to their economies.
The implication is that the payments
problem persists because
they, the deficit countries, refuse
to
take
adequate
measures
to

w

On the

attitude

pylrpmp

mentsproblem
ments problem
can

Present prices cost about £ 750 expansion in production and trade

never

"is

problem

foem

said to have existed in

or

oxx0 iorm 01

hhrx

ooothor

dnotner sin.00 txi6 iirst

war..And

World

its

.£10° mi!lio.n °ff "ts WPorts. Here ternational payments.

1S

one
i

j

single factor that caused

«

*

recessions

and

de-

pressions in the United States, the
recurrent

States,
United
nets

booms

the

United

the

development

States

for

in

in

of substitute

major imports,

as

the

prod-

nylon

for

silk, and synthetic rubber for
erratic stock-piling policies in the-United States, too low

natural,

dollar

price of gold,

excessive

protectionism in the United States,
or
the
unwillingness of Ameri—77—
An

address

by

Mr.

•

-n

*4.

•

?

r^hutio'pc

it*

Rooth,

at

Nabon^J^ForeLnaTrade6Convenuln6
Y«rk city, Nov. 17, 1952.




'

the
New

isiofintiqi

Policy

involve widespread'

or persistent
unemployment. It should prevent
Dersistent

rise

in

Rnf

mete

a Persistent rise in costs. But
there must also be sufficient flexibility in the economy to allow resources to be moved to th^ D/o
moved to the pro
,

.

•

° Produce efficiently
e export and the home mar-

®
°r

kets. Such a policy would require
p y "ale«ulrc

t0 tbe

earnings. Undertim tfmof troriincf IoreiSn' capital /rt home
such a system, the
a
h"
oiirrminiar
rrf
and
cuncncics 01 X110 ^rG3t xi^ciin^
~
...

.

m

Ce by

savings

freely con-

without inflation. If foreign capi-

million.
■
, The most important reasons for vertible. Countries could export,
A second major factor has been this, I believe,-will be found in say for sterling, and know that
the great rise in the prices of food- the great changes that have taken they could use the proceeds to imstuffs and raw materials, Britain's plaee during this generation in the
^ from any part of the world.
principal imports, relative to the ob.1.ectlves of national economic
pvnnrf tn anvomin
Prices of manufactured goods, policy. Throughout the years there; Tiaders could expoit to any counBritain's principal exports — that has been a great increase 111 the try and know that they would
is, the change in the terms of degree of responsibility which na- be paid promptly in accordance
trade against Britain as compared tions have assumed for their doith the credit: terms that they
with the prewar period. If be- mestic incomes and employment,
aareer] UDon
tween 1938 and 1951 the prices and full employment policies have have agreed upon.
°f United Kingdom imports had been pushed particularly hard in
- Solution Some Wav Off
only risen in the same proportion some of the deficit countries of
Solution S e W y
as the prices of United Kingdom Europe. In many of-the raw maWe are still some way from

^ av«lf b'e .°n. a 8e"eraus

Ltorfafthe^mpM'fncmasrin abouf $1,800
recurrent

•

persistence

productivity in the United States
the

remittance

with

is
n

that a sound financial policy need

a?e

volume of imports that would at There has, however, been a great under competitive conditions, free
£rom restrictions and discriminathat
the
navnu'lion. In 1951, the net earnings in the postwar period. But, un- ..
.
...
.
...
intractable and of the United Kingdom from over- fortunately, we have not yet got tions, and
prompt
mtiactabte aad
seas ivestments paid for less than
a strong and stable pattern of inof import payments and current

other hand, there is an

sectoi of the
On
the other hand, I do not believe

Even before the war the pay- restrictions ' Some persons
ductlon of th« ^oods which the
measures*
ments situation was unsatisfactory.1 even willing to accept as per- country needs for its own use and
Let us consid?r wbat has been It was kept in tenuous balance by manent a situation in which the for its exports. This seems to me
^one by ^the United Kingdom, the tolerating unemployment in some demand for imports is continually consistent with a moderate policy
sec°nd
industrial countries - especially swelled by inflationary domestic
maintaining high-level
world and the heart of the sterl" the Umted States—and stagnation policies and is continually held o
,
1 mainxairung mgft level
ta
'^tenals countries It in check by exchange restrictions/em.Pl°ymen'W'th°"t lnf'atl0n' .
f ^ one-fourth of- total world was a frail stiuctuie shoied up by
i
>-p ..
.
.hould not acunderdeveloped countries
;rae*
0 //°,r
,s
a^'e devaluations, exchange controls,
. ' ■
•
there must be some moderation in
bee" responsible for most of the bilateral clearing arrangements, cept such policies as permanent.
develonment
Bntlsh Postwar payments prob- and in some instances by default
I believe, on the contrary, that .
pu lLy rapia development
l?"1'.1."..19.38' *he"et faminSs o£
international obligations. The we shou]d aim at a stem o£ ba,_ "J cost. Many of these coun*-be United Kingdom from over- war brought about vast disruptons
, inw,vntinnQi n2umpntc
a
^ries would welcome a policy of
seas investments (excluding oil, that further weakened the struc- anced international payments at a balanced development that would
shipping and insurance) paid for ture of international payments, high level of trade, carried on pnahl.
.
,.
a

solve it.

a

reason

putS<itsVdSlju,enavments"in Cann0t be met by the right

not

'order

as

thire
the?e fs
there is

hand

attftude

treme

ehamiv

thic

nn

for emphasizing Europe's of supply has increased, and this
dollar payments is that this prob- dependence has been accentuated
lem is so complex. The payments by the falling off in East-West
dlfAcuities of other regions, no trade.
!^ss tban Europe s, must be solved
This persistence of the dollar
if balance is to be restored in payments problem is a natural
world payments. Their problems,-consequence of excessive emphasis
l*16 greater P*rt°f the Ploblem however, would be easier to solve 0n full employment and rapid debeen met, and I see no reason if a solution had been found in velopment. The payments probfor assumlng that the remainder Western Europe.
lem in turn has led to exchange

fense expenditure in Europe and
to the disruPtion of East-West
tiade. Each of these elements is
J?3!;1 0
■?
?
e<I
f
hope that a separate solution will
be found for them' 1 believe that

and tight credit.

countries

would

be

'

'
y
a anced deYe opmen can e made effective,
would enable the underdeveloped countries to import
al

j

on

widen the sources

8
,
n tne sources
ot supply for foodstuffs and raw
materials, and make it possible

for industrialized countries to

earn

dollars in third markets

WHat U. S. Should Do

have

exports, their cost in 1951 £1.050
would
been less bv nearly

terials producing countries, rapid
development, with emphasis on

achieving such a payment system.
,7.
„
, .

So far I, have spoken of what
..
,.

million, or nearly $3 billion. Al-

industrialization, has become a

Yet I believe that we shall achieve

y, the deficit countries, should

lowing for £200 million of dupli- political and

_,

Jt

,

social necessity which it. As examples of its advantages

.,

,

.

do. I must supplement this with

Volume 176

Number 5172

•

The Commercial and Financial Chronicle

...

(2023)
v

what

surplus

the

you,

country,,

should do. First, large as your

core

im-

of the payments problem that

persists, r As

<

international

r

ports are, they are still too small

can

interests and

best

own

your

too small for the needs of
driven

world

a

circumstances

by

much

more

ports

of

dependent

the

to

ex--

is

It

of

sound finan-, low the right policies and it will

greatest
States

currencies;' Im the; achieving,; balance

coun-

not hesitate to

use

contribution" help ..countries
can

make

in. the

to■ payments

its

With

resources to

with

balance

:difficulties

that 'are

Goodbody & Co.

(Special to The Financial
Chronicle)

of

ST.

.

PETERSBURG, Fla.—Mrs.

Pa^ricia^T^Lyon^'ls

now

with

world

.

.

'

-

'1

r

®

'

/Qvmrtfn 1

(Special

ter

world

4-#*

to

M

The

DURHAM,

Financial

N.

production andt Moore

■

Chronicle)

C.—Marjorie

is now with
Reynolds
Co., 108 Corcoran Street.
>

most manufactured goods are

burdened by

pediments.

still

,

tariffs and other im-

,

particular,. some

In

,

..

agricultural goods that your con-"
want and which your pro-

sumers

ducers

-

unable to

are

quately
excluded

from' your

prohibitions
strictions.

spirited

partly-

or

market

quantitative

by-

re¬

encouraging

or

It' is

that

know

supply ade¬

wholly

are

to

able

so

and

public-

the Public Ad¬

a group as

visory Board for Mutual Security
is

re-examining the trade and

now

tariff

policy of the United Stat2s

for consideration

by the

Ad¬

new

ministration. We look forward

to

their report.
There

is

other

the

lead

in

field

States

one

which the United

can

restoring

in

take

balance

in

the world economy. The European;

countries, which

eign

investors

which still invest
be

in

large for¬

were

in

the

past

and

abroad, will not

position to increase their

a

foreign investments until they
cure

In

se¬

surplus in their payments.

a

the

meantime,- if

developed regions

the

under¬

to have

are

opportunity to expand their

an

pro¬

ductive capacity without resorting
to

inflation,

through

will

it

have

to

be

larger capital flow from

a

the United States than at present.
I

,

recognize, of course, that the real

barriers
ment

international

to

the

are

invest¬

political uncertain¬

ties and the economic risks, some'
•-of

the

them

wise

of

consequence

policies

the

in

un¬

countries

seeking foreign capital. I believe,

that

nevertheless,
steps

constructive

be taken jointly by the

can

\^i&\
ri WW
/
;!{

*

j

'

'IM IAM■-

\

•

V-.

a-v;

No Chase bank office is shown here. Yet the

Chase—and Chase

United States and these countries

to

investment

encourage

sound basis and

on

on

a

larger scale

a

than at present.
is

There

one

further

point

I

should mention. The level of gold
and dollar

of

tary

Fund

Mone¬

International

is too

a

part

banking—are

very

much

of this picture.

Through correspondent banks, branch offices
and

representatives, Chase

serves

business

in the markets of the world.

of many mem¬

reserves

the

bers

small to

allow

If you are

engaged in foreign trade,

invited

consult with officers of the Chase

to

you are

adequate margin of safety for

an

payment -fluctuations
restrictions

change
These

countries,

hesitate to allow

when

are

ex¬

relaxed.

therefore,

often

of freedom in trade and pay¬

ure

Foreign Department and find out why
importers and

exporters are

so many

saying,

gerater meas¬

a

"If

Pays To Do Business with Chase"

Of

tion.

bers

are

within

a

restrictions,

it

will

be the

~

In br xtf,
can

Santurce

Colon
David

Cristobal

NATIONAL BANK
OF

THE

CITY

OF

NEW YORK

Balboa
Offices of

Representatives
HEAD OFFICE: Pine Street

corner

of Nassau

Deposit Insurance Corporation

Mexico, D. F.
Buenos Aires

Rome

this is what I believe

be done on

international

pay¬

Cairo

Bombay
THE CHASE

ments:

It

measures

is

possible,

by

proper

in both deficit and sur¬

plus countries, to meet the hard




v

Panama

.Member Federal

Conclusion

•

Marianao
San Juan, P. R.

do

policy ol the Fund to assist them.
i

CvORtDWDE

reasonable

members

Whenever

adopt such policies and desire to
relax

Havana

re¬

mem¬

bring their payments

balance

into

period.

of

unless

.

Osaka

prepared to adopt policies

will

which

level

no

adequate

'"

-

Tokyo

for their reserve posi¬

course,

is

serves

BRANCHES
"

Frankfurt/Main

position becomes stronger, because
concern

OVERSEAS
London

ments, even when their payments

of

1
•*

striving to achieve its objectives. Goodbody & Co., 218 Beach
Drive,
meantime,, a prompt • remittance .economy is to increase its imports; In these
ways we may hope to "North.
'
system can be established in those and join, in a larger program of move forward toUie
achievement W'fK R *
n
o
r
countries in which arrears in xef ,foreign ^investment for the
bal-j of the goal of this Foreign Trade
'k
■
Reynolds & Co.

be

the

on

United States.

tries.. The

gradually, approach the,con-, the ^United

vertibility

en

rial-policies in the deficit

ments become better balanced, we

for

\

pend principally

pay-

ll

Paris

BANK

')

P.
&

12

(2024)

The Commercial and Financial Chronicle

pose

Banking Is Affected
By Vicissitudes of Railroads

ate

Pennsylvania Railroad Company

railroad welfare to banking, Mr.
banking and railroad prosperity are closely
linked, and if railroads are nationalized, banking will follow.
Says railroads are over-regulated, thus hampering their prog¬

admittedly not constituting our
transportation industry, is

a

large and

very

ment.

important

and

There¬

which

the

present

ing

averaged
their net worth,

be

sure,

to

essary

that

see

played in such

a

that

sure

is

rules

some

a

the

are

the

about twice that of

dm p e rative
that the rail¬

four

roads be kept

i ina

ncially

sound,
pus
sure

volved

three
in

as¬

of

David C. Bevan

national

in

our

deteriorates

and

and

becomes

weak

inefficient, dry rot will

per¬

our entire economic
stru^
and it in turn will gradually

meate

^ure

wither

and

virtually

die

on

the

tainly

the

figures

I

duction

for

to

solicit

of

our

a

sales

a

have

just

much

So

for

standpoint.

Let

sider the dire

befall

the

further

us

have

heard

ments

on

Reserve
States

good intro¬

Finance

industries.

us

how

ment

consider for

the

welfare

a

of

tion. I

of

if

war

think the thought itself is so ter¬
rifying that I will not labor this

ample evidence not only of your
recognition of this existing rela¬

point further, other than to point tionship, but far more encourag¬
out that in the last' war. 96% of ing, your manifest concern;
One
all organized military traffic was of the most serious problems with
which

handled by the railroads.

confronted

is

drastic
,

V^lv.

Problems of Railroad Industry
Now

let

moments

certain

examine for

us

the

of

railroad

its

problems.

few

a

industry,

characteristics

In

one

the

sense

and

rail¬

road

industry is similar to the
banking business. We both have
the same product to
sell, namely,
service.

The

investment
billion.
banks

railroads

in

Total
of

have

plant of
resources

course

far

an

over

$25

of all

our

exceed

figure. The railroads employ
and a quarter million people,

are

two

im¬

portant effects of railroad regula¬
tion

on

to-day
need

to

banking. First, the dayeffect, and there is no
point out to you that as

the railroads prosper there are di¬
rect benefits to banking, or that
as
the reverse situation prevails,
there

this
one

it, there

The

the

adverse banking effects.

are

second

rather

effect

simply

to

slightly less than $700 million.

1951 net income of the banks
in the neighborhood of

was

in

excess

latter

slightly

4.8%

of

contrasted

as

goes

byond

first

feel

if

you

position. However, I
iwhen

we

to

jointly.

use

Last

we

of you
in

must

the
year

have

a

our

admit

perfect

crying

towel

manufacturing

address by Mr. Bevan at the
24th
Annual Trust and
the

time have

it, should stand

up

a

and

over re ffu la
ot
over-regulahere today to seek
your
jL

Conference

New

Jersey Bankers Association,
Asbury Park, N. J., Nov. 19, 1952.




nhviiri*

.

not

be

per-

thp

obscure

tact

fact

that
tnat

tne

..

..

.

Thi^

tljne in mutual trade
me pasl* 1
Ot
our

nr

•

t

relations

m
evidence that we are
working along much the same
lines and along the right lines

the
is

tide

which
of

will

re-

turn

nationalization

all

this

I

tide

business.

believe I

In

about

for

me

the

social

there is

no

plan¬
question

progress

can.

that

made.

progress

has

been

made,

disillusionment in pre-war years.
a sharp lesson
-n those years.
It learned that

The worid learned
like

is

peace,

indi-

It is sometimes said that the
great post-war effort to reconatr"ct world trade has produced
little result,
.

since trade is today
rp~trk.tion<. than

only too true that trade barriers
around some countries have mul-

at an alarming rate'.Tt?ls

fS'KKa

over

ten

years

t0^y. ,tr.a i g Practlces>
would today, I have no doubt,
be even more barriers to trade
and less trade. We have not

venience. We have always been
in

difficulty of

tion, but I

an inadequate spread
between income and
outgo which
does not produce a
proper return
on the investment in
our

the

same

geographical

posi-

remember only
too well when goods moved a
good deal more freely to markets
property, thousands'"Of miles
away
than
times people are inclined across tjte. Canada-United States
of return on investment border.

to

to

function

in

such

keep them modern

ating in

a

a

can

,

In

the

part,

trade between
times

great

in

in

volume

countries

in

and oper-

need

have

of

been

what

duced

fashion necessary to do

efficiently
!that is by

But

in
no

financial stability.

crease

in

trade

3

pre-war

be

the

pro-

othpr.
the

means

would

placement of
I

worn-out

mentioned

1

property.

some

to

com-

parisons of various industries

know

not

the
the

in-

have

that serious obstacles

Canadian-United

At
was

the
a

end

of

the

pression,

fear

a

there

war

deeply seated fear
that

of

de-

nations

unemployment at home, attempt
f° export unemployment abroad

and

increasingly

could

nature ot the problem,

would, in their anxiety to prevent

years—is attributable to the high
level of demand and to the fortunate
circumstance
that
both

way

failed; we may, however, have
underestimated the magnitude
and> in some ways, misjudged the

in

value

since

n-;d-crimina-

countries

increase

two

our

times

7

—some

principal transportation job whole story. However
high
required by the country and, at
demand, however fortunate
the
same
time, give them real circumstances, such a
great

Earlier

.

you, if I best
customer. Canada is your
difficulty. best customer. Nor is this simply
of unprece- 3 matter of proximity and con-

dented business for the
railroads,
up against the fundamental

roads

•

war, and the acceptance, in prinSipie. y many countries, and in
act by some, of

anY

are

we are

as

failed

States

trade

by restricting imports, as they
dane !n Prewar years. This

had
was

fbe kind of situation the world
m°sf feared, and made preparati°ns to avoid. As things turned
out>
the
problem
throughout
most of the post-war period has
been excessive demand, not deficient demand. Most countries
bave found themselves grappling
with inflation and shortages and
n°f with unemployment.
What
we have witnessed, therefore,^ is
a multiplication of trade restrictions not for the purpose pri-

marily

of

protecting

producers

_

domestic

against foreign
Petition, but rather for the
P°se

of

protecting

cornpur-

national

re-

5till exist, obstacles detrimental serves of foreign exchange, parearnings against net f° fbe best interests of both coun- ticularly dollars,
my mind is the ex¬
worth. Let us now, if: youmembers of the Naof time it will take to
go from
Detriments of Trade Restrictions
stage to another and finally compare the return on investment;,uonai foreign
Trade
Council
the

ultimate

result

—

the

only doubt in
tent

they

had it not been
-On Uie con
rap
it not bwa
scale, tor the series o± tarm reductions

—

To

ago—I

trading with each

our

it

beachhead6

principal

are

The railroads
nationalization over the rail¬
except for a taken place had there not been
roads, is allowed to continue, then mere handful of exceptionally fa- a mutual willingness to facilitate
or later, the
railroads, then vorably situated companies—have trade.
other regulated
industries, then not had sufficient earnings for TT c n
*r
a
ai. ♦
i
other essential industries will be improvements and
necessary reU* s"Canadian Trade Obstacles

plums

years

other on a tremendous
More trade is carried on between

facing

make

presently holding the
Let me pinpoint for
our

we

sooned

ripe

attitudes

what

tw0 countries than between
other two countries in the
world. The United States is our

can

clear to you that the railroads

may,
With

that

^;

flowing all too strongly

towards

of

ners.

the

b&

program

the

take notice.

one
•An

Bankin?

all

regulation, which holds the threat

examine the records of

other industries
rirht

any

were

of

industry,

net

admit that his
earnings were ade¬

would

ent
in
one
large
others which at the

should

to

agriculture and labor, for the

more

about

their
to

The

7^% by the banks.
Having as
yet to meet a banker who would

quate, I wonder how

is

I say to you that
your situation
will follow ours, and if excessive

of that of the rails.

earned

worth

or

think it

measure

$800 mil¬

lion, to $900 million,

I

Nevertheless,

the area of agreement on funda- more beset witn restrictions than
mentals is °
greater than at any eT
i ? +u"fortKUnately
t

analogy.
important and So many
clusive of the thousands of addi¬
to think
bears closer scrutiny because it
tional employees in outside indus¬
can have a
long-term detrimental as that which is available for divitries which supply them with ma¬
impact on banking beyond the dends or that which accrues to
terials. As against this one and a
the benefit of the stockholders,
scope of day-to-day comparisons.
quarter million, it is estimated
It is the problem
of regulation While it is true that this is an
that there are approximately five
which has grown to such
important part of it, we must not
propor¬
hundred thousand employees in
tions that in the manner of a overlook the fact that there must
the banking field. Last year rail¬
Frankenstein it is more powerful also be included in net return
road revenues grossed over
$10
than its creator. When it is
enough margin to enable the railpres¬
billion but net income amounted
ex¬

two

United

with

20

or

do visib^e

theTffe"-

But

us

,

mitted

-

which

see

do.

compare

prosperity,

Americans

and il is true of our resPective
^
"

the railroads, and
lack of uni¬
formity of regulation for all forms
of transportation.
I

and

wme'^^ffheworst featured thS
ov^r-regSatXn ThFrailroadsare

back

As

our

the

ready to admit
goods and agricul¬

I

as

been

This

which sometimes arise be-

tween
a

.•

regulation but over-regulation for
i

D. Howe

.

Canadians

exam Die
example

am

,

form

are

has
C.

large.

ences

nrespnt

in

as-

only marvel at the

^??1fricai'5 business concerned
^ra^.e relations between the

the Fed-

inrinctrv

between

you

trade

15

were

United States and the world at

or

Reconstruction
or

if

I

towards

with

United

I

railroad

.

not

we

the

trade

were

—when

ITl0.re

uau»
Railroads—Drastic Example oi
uid&Mi
Lxampie of
Over-Regulation

mo¬

your

the
transportation
industry
in situdes of the railroad industry.
general, and the railroad industry The very fact that you so kindly
specifically, becomes crippled.
I invited me to come here today is

event

of

Corporation,

f

The

the

the

par-

when I look at the state of trade
between our two countries today

J*1311 *ocaJ P"

your I com-

or

may

you

tionsSaving3'and Loan Associa" maUe^oftrade.

industry is affected by the vicis¬

in

us

Board,

I

Merest and mI believe, because there has been
fluence. 'At
in
both countries a determined
th®se annual meetings, if any- effort to avoid, if at all possible,
wlidre, is to be found the au- & return to
e
"beggar-mytnentic voice of that part
neighbor"
policies
that
led
to

rulings of the Federal

activities

presentation

of

some

of

much

as

of

are

If

moment, I would

deplore those continuing obstacles

out

go

our

Treasury Department,

^

equity funds f6r either

Now let

con¬

tragedy which will

I think, appreciate

sponsibilities of banking manageout of your hands.
I

Banking and the Railroads

economic

v

ment taken

vine.
*

conditions,

position at the moment when you
consider how upset you get when
you see some of the
prime re-

the

quoted do not make

which

our

vention

You can,

own

tive in relation to figures for in¬
transportation
dustry in general. While all types
system. I believe it is self-evident of investment have their particu¬
that if our transportation system lar characteristics and
values, cer¬

influential
The
impressions
and reports
from the National Foreign
Trade Con-

day

exchange

tural products as you are to admit
our metals and other raw mate¬
rials. I venture to hope that

group.

present

to
the

everyday statistics
companies we fail to
keep them in the proper perspec¬

strong

a

and

realized

seem,

and dy¬
to

that

Sometimes, strange as it may
I think we become so in¬

vigor-

namic

industry

times

that it benefits

state

manufactured

distinguished and

transportation economy as a
whole, regulation may be necessary, but it should be geared to

railroad industry.

banking

the extent

to

the

and

happier about the present

even

States

a

earned

of

trade

countries

gratifying

express

kept sound and operated for the

worth

but

of

be

these
views to such

business

sential

removal

and it is particularly
to be able to

is

way as to make

banking

Canada's

current problems of world
trade,

nec-

game

Cites

I am here today to express a know that too.
Canadian point of view on some ticularize for a

banking system.

debate, that it
is not only es-

ucts

is
perfectly
Obvious, and
not subject to

pi

strictions.

restrictions, and calls for lower U. S. tariffs on Canadian manu¬
factures. Deplores
shrinkage of trading areas due to "Com¬
munist enclosures."

cannot

vately managed

commerce,

restrictions.

benefit of all. Likewise, as I have
15.1%,
industrial
chemicals 17.3%, petroleum refin¬ previously mentioned, I cannot see
the economy of this country funcing 15.7%, motor vehicles 17.9%,
office machinery 16.6%, and so on. tioning, either in peace or war,
without a strong railroad transIn other words, many industries
portation system, and here again
obtained" a
return
on
their- net

fore I think it

;

moving toward
despite postwar trade
Says main objectives should be, first, to
being
about further trade
expansion, and, second, to get rid of re¬

higher level of international

ex¬

rules

imagine the free
of this country flourish¬
without a healthy and pri-

To

few of the spe¬
cific industries making up that
average we find that paper prod¬

seg¬

In hailing increase in Canada's
foreign trade, particularly witli
U. S.r Canadian Cabinet official holds
world is

economy

whole

on

looking at

to

You

appeal to ICC from decisions of State authorities; (5) that
ICC consider effects of rate
adjustments on railroad finances.

entire

Minister of Trade and Commerce and
Defense Production, Canada

whether

not

an excess of regulation
hampers the progress, and
the survival, of an im¬
portant segment of privately man¬
aged American business.

of

a

is

represent

adjustment delays; (3) abolish¬
Long and Short Haul Clause of ICC Act; (4) right

companies as
14.4% return

problem

Import

By RT. HON. C. D. HOWE, M. P.*

which

rate

while

Less

can

threatens

roads receive equal treatment with other forms of
transporta¬

industry,

regulation

any

beyond present needs and the
tent

Cites low return on railroad investment, and
says railroad
borrowing is depleting working capital. Advocates: (1) rail¬

railroad

Needed: More Trade and

to which it has been increased far

ress.

The

and

necessary

the regulation when imposed was
desirable or not, but the extent

In stressing importance of

ment of the

without

today's

Bevan points out

tion; (2) elimination of

was

bring upon other industries, and
society in general, undue hard¬
ships and misfortunes. However,

Vice-President in Charge of Finance

:J V..'

it

perhaps in the public interest, and
it should truthfully be said that
any monopoly allowed
to oper¬

By DAVID C. BEVAN*

j

time

Thursday, November 27,1952

it should be said for part of

that

How

...

the

basis

on;

of

#

to

complete the cycle.

The railroads have had regula¬
tion for over 65
years and I sup¬

for the railroads last
year, which
amounted to 3.69%, with that of
1

Continued

™

on

90

page 29

•

■

»a«

address bv Mr

How*at the

Amer-

ica's Session of the 39th National
Foreign

Trade Convention, New York City, Nov.
17,

1952.

touio

li

*S V Jegret~

"wh^wr their Origin^
StriCtlOnS, whatever thpfr^ nrifdfT
strktions

and however

temporary they

arq

Volume 176

Number 5172

...

The Commercial and Financial Chronicle

13

(2025)

intended to be, have
to

tendency

a

world

become inbedded in the struc¬
of a nation's economic life.

greatest measure of freedom from
restrictions.
The
part
of
this
objective that has already been

Quantitative

restrictions,
intro¬
duced
for
balance-of-payments
reasons,
do afford
particularly
protection

against

has
not
been
easily
gained. It has called for unselfish,
co-operative work on an enor-.

for¬

eign

competition, and the longer

they

are

continued the

dif¬

more

they are to abandon..
We know something about this
problem. ; Just
live
years': ago
Canada

today

forced

was

quantitative

pose

to

There

was

continue

the

U.S.

strongj

those

need

to im¬

restrictions

conserve

when

disappeared.

But the government, from tne out¬

set, made it quite clear that they
would
be
removed
when
they
were

a

period

eign

away.

the

of

today

reasons

is in

position

But,
look

from

effective

most

sources

that

prevent

Africa.

making the
the

of

use

world

-re¬

do

I

be

can

those of North and

Australia

America,
The

whole

was

not

countries

as' well

It

-

suggest that the two
regarded as being inde¬

structure

a

as

' the

of

century

areas

are

of

now

enterprise.

A

territory

virgin

available

third

to

hew

factor,

and

very formidable one, must also
be taken into account. The open¬
a

,

being enlarged, in the older

was

the

that

of

production and world trade

available to it.

in

and

new.

ing

economic

up

of

ternational

new

frontiers

trade- is

in¬

to

being
pendent of each other.: To some growth iri every quarter of the offset—perhaps more than offset
jmous scale. 'The part that still
extent, however, they lend them¬ globe. • - —by the closing off of huge areas
remains to be accomplished
may.
Part of the expansive power of and
selves to separate considerations,
*
populations from what we look
prove to be even more difficult
and I wish to say
the; 19th century,, but .not all of ;upon as normal commercial inter¬
something first,
to
attain.
It will
certainly not with special reference to some of it, has carried over into the
pres¬ course.
be accomplished if
there is any
ent • century. ' Looking
the
factors
that
have a
at North
major
About one-quarter of the
letdown, either in the cooperative
America alone, we can, no doubt,
bearing on the prospects for the
"nature of the, attack
world's land area, and something
upon
the
claim
that
the
momentum
has
expansion of trade..
more than a quarter of the world's
problem, or in the readiness of
been well maintained—and everi
'Increased
trade
is rooted
each of the free -nations to make
in_
population, is now fenced in by
increased.
The same
might be communist
increased
the kind of contribution
production.
Interna¬
control.
The area in¬
that will
said: of other regions, but it is
tional
commerce
had
its
serve best to
most
volved is almost equal to that of
promote the common
very questionable whether it can
spectacular period of growth dur¬
purpose.
North and South America com¬
be said of the world at large.
ing the 19th century. In a very
Two Main Objectives
It is not merely that we have bined, and its population is twice
real sense that was the
golden
Our two main
suffered the disastrous setbacks as great as that of North and
objectives from age
of
commercial
expansion.
this time forward are: 5
first, to It wasn't simply a matter of the of two world wars, or that there South America. Those facts conbring about a further expansion
*
development of immense virgin has been an inevitable shrinkage
Continued on page 28
.

now

Canada

why

strong

a

competitive

world markets.

on

when

we

the

on

trade

not

and

short

were
completely
We followed the
policy with respect to for¬
exchange controls. That is

same

war

needed,

comparatively

they

swept

one

longer

no

within

world

•

to

pressure

South

restrictions

free

-

dollars.

restrictions
them

for

in

areas, such as

the

,

ficult

order

trade; and second, to get rid

the

realized

-

effective

characterized not only by. of
by the of

expanding trade, but also

ture

inclined

are

dark

side

of

than

more

to

post¬

developments, let us
one
highly signifi¬

overlook

cant

fact.

That

is

tnat

interna-;

tional

trade, as a whole, both in J
volume ana value, is greater
than;
ever
before.
Surely
this
does!
not

indicate

of

a

collapsing

international

it indicate

the

trade,

that

have

we

.......

.•

.v.;

ty.

vav.v v y

*•

.v.;.

system-

does

nor

been

track.

wrong

<" >

on

;

We may often feel that the
plans
which the free nations drew up

launched

and
years

seven

for

ago

the

eight

or

revival

,v*|g

and

expansion of world trade have in-

respects

many
of

fallen

succeeding

out

to

in

far

■j

they set
Admittedly that is so.

do.

In certain directions the

that

short

what

.

"

-

K,-,

headway

have made has been dis¬

we

appointingly . small
and
slow.:
Nevertheless, it is a fact that, in
the last half dozen years, the free
nations nave done far more in
the way of getting together and
working together for the purpose
of

putting

back

been

the commercial

its

on

done

erally

before.

been

never

has

much

so

than

feet

There

years of experience

world

has

ever

has

lit¬

period when

a

been

undertaken

collectively and cooperatively.
On

this

may
whether
effort

side

of

has

not

been

have

-at your service

water

rather

in terms of money.

I

the

occasionally
question
our
part in this joint

we

On that

doubt

no

whatever.

If

or

had

we

costly
score

National

misgiving

in Canada or in the United

States,
give the kind of help which in

to

these

recent

that

the

both

the

ultimate

pockets

bined first-hand

circum¬

hind the

immediate

costs

to

have

been

than

they

have

of their

offers

'

foreign

customers call Head Office

fbr'i&formation about

a

with,

you

of the globe

your

business

will find National City

ca¬

pable of providing on-the-spot assistance through
men at Head Office,
through resident personnel in
our

Trade Moving

what quarter

matter

is concerned

superior banking service which National
organization

customs.

com¬

No

Wfien National City

been.

International

sum

who have lived in the country,

men

speak its language and know its

traders.

infi¬

heavier

they talk to

in actual service

experience is the guiding force be¬

City's world-wide

our

would

home and abroad

at

years

with the Overseas Division. The

required, and have
without
delay,
I
am

required
certain

nitely

total of 2,739

have

stances

and

the

years

City Bank officers

have spent a

failed, either

57

overseas

network of

specific foreign country,

branches, and through

correspondents in

our vast

commercially

every

important city in the world.

To All-Time High
.

All

of

credit

free

worked

some

■

nations,

at

•

that

closely and so
energetically together, can claim

ternational

■■

.

the

have

"

so

for

the

is

trade

fact

that

now

THE

NATIONAL CITY

an

trade,
of

coupled with

67 Branches

what

we
we

the

the

have

That is

is to
the

have

later—

the

without

high

restrictions.

.

57

ARGENTINA

CANAL ZONE

Buenos Aires

Balboa

Bartolomi Mstri foi

F lores

stand

now,

we

material part of
post-war commercial objective.
The
other
part,
almost
one

our
'

•

equally

•to

win.

several

important,
The

we

years

have

that

target

ago—and

still

was

set

set

very

40 z

Sao Paulo

Porto Alegre

Recife

that

of

a




commercial

j

**-'

(Pernarntiuco)

Rio de Janeiro
Salvador (Bahia)'

r,

■

■

,

Barranquilla

'tallw.T

1
liA

"Medellia

PHILIPPINES
Manila

Tokyo
Nagoya

Panama

Cebu

Yokohama

PUERTO

)4

Avtntda

INDIA
•

Bombay
Calcutta

SINGAPORE

RICO

Singapore

San Juan

Mexico City

Hong Kong

Manzaniilo

Santiago

PANAMA

Port Area

Osaka

2Jost dt Jzs&s Trztl St.

.

Santurce

Isabel la Catilic*

Cardenas

Matanzas

REPUBLIC OF

•

Juan Luna

MEXICO

Paris

.

.Bogota

Santos
'Jha

>

Waterloo PI.

HONG KONG

Caibarien

'J

•

it

FRANCE

Twenty-third St.

COLOMBIA

Ipiranga

West End

JAPAN

Clark Field

La Lonja

Valparaiso

Prof* Antonu Prado 4S
Avenida

President) Zayal

Cuatro Caminos

Old Broad St.

Galiano

Santiago

BRAZIL

London
ny

CHILE

•

largely in terms that were writ-ten
or
inspired by the United
States—is

0ian/dn^

BRANCHES

ENGLAND

Havana

Plaza Once

matters

have gained

OVERSEAS

CUBA

Cristobal

Ro3ario

As

•

Wci/d fyiicle

at.

want

without

trade

in

not

aiming

been

really

former

high

throughout Greater New York

Member Federal Deposit Insurance Corporation

high level

a

restrictions.

trade

What

;

NEW YORK

Head Office: 55 Wall Street, New York 15, N. Y,

moving

reaching a unique position—one
which, I believe, is without prec¬
edent.
We have a high level of
•

OF

all-time

high level. That
fact, however— extremely im¬
portant in itself—is only part of
the story. We have succeeded in

;

BANK

in¬

Arecibo

Republica

Montevideo

Bayamon
Caguas
Mayaguez

-

PERU
Lima

Ponce
'

••

*

>

VENEZUELA

.

•

.

*

URUGUAY

■

v

.

t* s
» -

.

*

— -

-

Caracas
.

-

*

>'
1

■

" »

t

14

The Commercial and Financial Chronicle

(2026)

The Personal Side of Investing

self. The

N. Y. Stock Exchange

,

tainly
for

living advising in¬

executing

them—and casualties among
even

wounds,

"killed

in

to

for

orders

them,

nothing of

say

ac¬

tion," are most
unpleasant to
contemplate.

by speculators as well as
It will be read by
people who can afford to take
risks, and by people who cannot.
It will be read by those who have

often has been

serious

fi¬

fatal

and

read

by investors.

high rate of

a

more

firm,

my

geneous

be

there

While

Commentary

he faces a hetero¬
readership. He must rec¬
ognize that what he writes may,
and probably will, be read both
by the financially literate and by
the financially illiterate.
It will
for

suffered

by

invest and by those
are
fully invested.
It will be read by investors who
should buy the type of securities
discussed and by those who should

real

in¬

not.

nancial

s

idle money to

casu¬

alties

who

among

peculators,
v/ounds

the

the

L.

"unto

O.

Hooper

investor, and prac¬
prudence, there is
why you should not

tice reasonable
reason

to

continue

you are

forced

be

investor all of

an

mortal life. If
a speculator, you may be
to
disassociate
yourself
of

days

from

your

securities, and not

owning

speculators,

to have as many

proverbial
who

I

cat.

several

know

alternatively

been

liave

however,
lives as the

broke and rich several times dur¬

at least one

ing their lives—and
is

of them

optimistic,

as

say

be¬

want it to be

pessimistic. Worst of
all, not a few will half-read what
you say and go off with impres¬
sions you never intended to give.
Limitations of Mass Readership
I

been

well

as

When

ness.

1919, and I know its
useful¬

its

as

this question: Is the writer

to someone else?
I want to lead up

! What

Investing is

person

make

can

heap

one

to

is

business.

investor

Every

has

invest¬

an

ment

vestor has

one

on

throw

cific

pitch and toss,

"And

at your

"And

again

begin
beginnings,
breathe

not

about your

loss,"

then you are a born

speculator, or

gambler, a person who wants to
live dangerously and not be bored

either by the monotonies
wealth or by the discomforts of

always

poverty.
us

do not have person¬

adjustable

and

one

poration stock, has
all

its

a

Each

own.

$1.50
this

else.

"personality"
fits

one

-

for the

to

principal

It

is the

business of

invest¬

an

to

the

extreme

life;

of

downs

this

and

counselor, or an advisor, or
broker, to bring the proper se¬
curity "personality" to the proper

a

investor

personality.

function

securities

the

investment

counselor

help.

can

If you are

looking for a chance
to
get
rich
quick, this course
probably has not helped you. It
was not designed for such a pur¬

of

the

It

advisor

the

is
to

tailor

the

to

investor, just as
it is the province of the fitter of

clothing to tailor apparel to
physique and personality of
one

who is to

Anyone
you

Fake

a

who tells you he can
in the process of get¬

ting rich quick through

specula¬

tion in securities either is ignorant
faker.

the

put/food

be

her

on

back

her

on

table

stock,

or

there

any

which is the

bond,

any

is

right investment for

charlatans, in this
business who sell the equivalent
near

alcohol

flavored

water

Usually

and

patent

their

tea-col¬

medicine.

advertising

that should

business.
not

sold

as

conscientious

I

infers

suspect that much of the

public jumps for the bait because
people dearly love the inferences

characteristics

and want them to

surfeited

preparing
the

herein I
venient

to the

problem of
investment
literature
me

masses

of

investors,

provided with

am

a

and
con¬

jumping-off place for the

serious message of this lecture.
When

an

investment commenta¬

tor sits down to write such
my

twice-a-month

things
magazine

of

of this

Federation

of

of

Mr.

Hooper

American

before

Shareholders

American

the
in

Business, Inc., New York City,
November 21, 1952.




course

securities,

with

ma¬

has been the

different

of

and

than

Investor

as

a

if

better

inves¬

as an

speculator.

tinguisn between an investor and

speculator?

that

information

are
re¬

the

One
J. King

Harold

expect

might
to

management team

the

from

potential

of at¬

areas

not so.
Instead, labor
are
listing the fields in

but

leaders

expect attempted on¬

which they

antic¬

efforts to curb industry¬
wide bargaining, to broaden the
anti-trust laws to include the ac¬
of

tivities

unions,

to

the

narrow

excluding
degree of spec¬ certain issues previously fought
risk, if you look for it, in over), and to lengthen to "indefi¬
any
type of investment nite," the 80-day injunction period

ulative
almost

commitment?
Are

which

all

not

of bargaining (by

investors

specula¬

Act pro¬

Taft-Hartley

the

issues,

specific

industries,

ties themselves.
ever,

issues,

types

inquire into his attitudes.
An
investor
buys to keep;
speculator buys to sell.
An investor buys values;
ulator buys

to illustrate.

The share of
a

a

mutual fund may¬

physician who is in

position to invest $500

month,
obtain

dollar-average

or so

his

every

costs,

diversification, and derive

the
the

government. But with
of the Wagner Act

passage

the

-of

power

government

was

brought into the conflicted on the
side

unions. Owners

of

had the

lectively in those

cases

the

through

union,

a

longer

no

right not to bargain col¬
in which
prescribed

the

legally

designated representative

of em¬

became

procedure,

ployees. To refuse to so bargain
collectively has meant (ever since
the

to

the

Wagner Act)

of the

passage

that

if he

employer,

battle

the

carry

chooses

enough,

far

subjects his property to confisca¬

is

serene;

specu¬

a

and

for

looks

investor

dividends,

earnings
regards ap¬

and

disputes

be most

will

it

event,

any

interesting to see what the
third

a spec¬

prices,

investor

An

for

In
a

lator is worried.

Congress

up

comes

Eightywith in
Ironi¬

the field of labor relations.

Republican

previous

the

cally, .

Congress (Eightieth) left manage¬
in the incongruous position

ment

of

defending,

since, the Taft-

ever

incidental; a specu¬ Hartley- Act, which is at least
lator looks for appreciation, and 80-% pro-labor monoploy, and not
more than
20% pro-management.
regards earnings and dividends as
This, because the Wagner Act was
incidental.
incorporated into the Taft-Hart¬
An investor bases his commit¬
preciation

ments
a

on

on

and

facts

bases

probabilities;
his commit¬

possibilities.
investigates, and

hopes and

investor

An

invests;

investor

ment

is

always

study

personality.

determine

to

strength,

patient;

weaknesses

to

invest¬

points

your

and capitalize
avoid

hurry.

a

your

Try objectively

and to locate your

and

and

them;

on

points of weak¬

permitting
lead

you

these
into

a

There

Here

are

Try

a

to

few

was

shadowed

gether,
same

simple ques¬
them for

provision in the

one

which

Act,

out-

far

others

the

all

put

to¬

economic effect. The
still be said for this

in

-may

which

provision,

one

stands

as

the economic foundation stone for

entire

the

Should this

Act.

Taft-Hartley

one

stone be removed,

the

entire

structure

ble.

The

provision

which

trap.

tions.

it

makes

an

would

crum¬

the

is

unfair

one

an

to

collectively with the
representative

bargain

answer

them for you.

(1)

What

On the

Think, and

don't cheat!

appear
are

my

investment

the

one

may

quite innocuous. But it is
which has made the labor

Why do I want to in¬ monopolies
ments they
vest? Do I seek income? Security?'

of

Am I going at this business' is.

investing hit-or-miss,

have

a

or

do

I

the

For

than

the

it

powerful

involves

age

instru¬

old

nothing

less

argument ordi¬

a philosophy? -.
past, in what way narily, phrased as "property rights
investment
experience versus human rights."

plan, and

(3) In

the

has

my

been

successful and

in what way

Continued

on

page

37

possibility

Until
Deal

it

the
was

advent

of

commonly

the

New

supposed

room

no

that

property

constitute an integral
part of human, rights. But, be that
rights

may

it may,

as

there

be

can

that

the

Wagner

into

the

property

Act

no

cut

rights

doubt
deeply

of

em¬

i

ployers.

Being politically conscious, the
Congress

new

choose to

whether
terest
It

is

foster

prime issue—

the

in

labor

in

engage

attempts

monopolies,

monopolies.

But,

palat¬

more

further
than

their

the

remove

tremendous

counting

in

hap¬

control

to

rather
of

cause

power.

in¬

national

find it much

to

hazard

the

likely' may

very

duck the

it

to

may

able

labor

■

votes, the politicians should bear
in

mind

the

that

labor

workers

one-fourth

of

the

not

not

union

bargaining.
The

that

1

Congressmen
of

some

collective

is

of "the

members,
collective

in

engage

of

nation

Three-fourths

are

do

and

only

force

organized.

the

will

.'

realize
for

arguments

bargaining

appeal. But they

have

great

also recog¬

may

nize that most of these arguments
do

surface/this clause

objectives?

(2)

the

labor

employer to refuse

practice for

legally designated
yourself,
honestly,
objectively,,
of his employees.
impersonally, as an outsider would
answer

for

This

rights.

property

over

power.

Wagner

speculator usually is in
should

with some addi¬
tions, which fell far short from
effecting a balance in bargaining
along

Act,

ley

speculator invests

a

then investigates.

You

ence

oversimplification allows

as

speculator

ments

*

how¬

a

affecting the tion, and himself to any penalties
tors, all speculators investors?
national
interest. They
should contempt of court may entail.
The best way for setting the
It was contended by the pro¬
take care in lengthening the list,
investor apart from the speculator
lest
management pick up some ponents of the Wagner legislation
is to look into his state of mind,
that human rights take preced¬
ideas not previously considered.
vides

programs

Permit me,

hold,,

operate the factories,

eral

at this

near

a

types

you

ceas.

plays.

scope

not

tnere

is

to

calling

choice,

they could not other¬

labor force)
and use
the tools in production. Employers
had a legal choice to bargain col¬
lectively, or not, as they saw fit.
The pressure to which they were
subjected on this score originated
with the unions, and not the Fed¬

ipate

ask, how do you dis-

But, you

*

labor

slaughts. They tell us they

Speculator

vs.

or

either by

did,

because

to

caused

tack,

infinitely

are

withhold
could

could

they

production,

wise enlist, or

the

to

organized

"investment

of

that
from

employers

defense/ has

regarding

rather

tor

them

are today. And, should
of
Peace of mind? Capital apprecia¬ management choose to ..center an
and
attack on this point, the public
tion? Adventure? Absolute safety?
even
systems of trading. I shall
would soon hear, from organized
not attempt, in the very few min¬ Amusement? (Do you know some
labor, of what great
economic
really just seek to be
utes allotted to me, to add to your people
fund of knowledge about securi¬ amused by financial adventure!) moment this particular provision

garding

be ideal for
•Remarks

confidential, and
a patient's re¬

as

lationship with the physician.
terial

That leads

relationship to his
as personal,
as

be

squad

time

of

j

or

an¬

portfolio

think of yourself

ness

professional,
as

the

chances

survival"
you

a

skills.

should

in¬

one

properly should be

other.

and

It demands

An investor's

of

out

security

very

bought for

vestor quite as

the

professional,
amateur knowledge, arts and

advisor

be

the

it.

wear

what they dare not say. A gullible

be true.

Sometimes

tor.

inves¬

every

they did not use them
harm on others.
This

bargain with workers individually,
or
collectively (as a good -many

not

that

think

Never

meant

other assets,

and

tools,

as

inflict

to

p
#

vir¬

of doing

they pleased with their

offensive

and

than tomorrow.

long

choice

the

as

enough,- g
the
yielding by its j

rather

now

with

ers

tually

its

ingly

who

widow

own¬

vested

property

private

pos-

as

though,

a

'

then

Investing, therefore, is a very
personal business. In my estima¬
tion, too, it is a most complicated

Beware of the commercial char¬

latans, and

as

would

make her money work hard

clothes

*

for

for

stock

sorry

must

the

A Personal Business

Speculation Promises,

ored

it

right

of

so

t;

sible. Interest-'

reinvest¬

in the United States that the

factories,

as

of

y

gains

not paid out in

but

dividends),

An

pose.

of

of earnings

ment

to

(from

grow

organized

retain

m a n

of making his

purpose

victory,
labor to

digging in for the battle in

to

thing

grand

a

horizon,

on

which it nopes

dividends

cash

be

caused

start

the

Republican

signs

the

by

,

have

for the estate builder to freeze on

need of

type of personality is not the one

or a

in

may

some

some
investor, but not one
fits the needs of every investor.

cast

share and has paid

a

share

a

year,

An

that

usually

peculiar

problems,
no

ment

Most of
alities

financial

in¬

Likewise, every vehicle of in¬
vestment, whether it is a bank de¬
posit, a mortgage, a government
bond, a corporation bond or a cor¬

word

a

,

every

definite and spe¬

some

to himself and

and

lose,

bent of any

or

other; and furthermore,

winnings

"And risk it all

assist

$150

around

personal

very

a

Ominous

to own who seeks capi¬
appreciation. Lincoln National
Life Insurance stock .which sells
a

tal

a

this:

investment talent
you

of all your

ups

surely is not the type of stock for

talking

to me, or

capacity often different from the

Kipling:

of

to

80%

Hartley Act provision requiring employers to bargain collec¬
tively with legally designated representatives of employees
stands, labor monopolies will persist.

income and can afford
assume
only a small risk.
It

read it, just ask

you

of

of

be

mass

personality—a peculiar ob¬
jective; he also has an investment

*

tax-exempts.'

pendable

Your

this

writing

readership type of investment lit¬
erature since

famous woman now

a

have

pushing toward 90 years of mortal
endurance.
Lifting a few words

"If

buy

King, in calling attention to Republican Party victory over

pro-labor, and falls short of effecting a balance in bargaining
power. Says it is likely the new Congress will "duck" the issue
of national interest vs. labor monopolies, but as long as Taft-

just the thing for a retired school
teacher who needs a large and de¬

they want it to be optimis¬

limitations

of your own imprudence.

Some
seem

be¬

avocation

this

in

"survive"
cause

should

rame

If you are an

the

you

tic; and others will say the very
thing is bearish because they

death."

no

interpret

cause

superficial

and not

will

readers

what

vestor tend to

be

already

Some

bad investment
in high tax brackets

people

who

magazine, or

Stock

Dr.

opposition of organized labor, holds Taft-Hartley Act is

very

a

American Telephone stock may

column for "Forbes"

twice-a-week

are

By HAROLD KING, Ph. D.

greater advan¬

much

to

F"

in his own business/' Fully
taxable U. S. Treasury bonds cer¬

improving chances of survival.
my

a

tage

"mortality" in capital management, Mr. Hooper urges
behaving as an investor in contrast to speculator for infinitely /

and

work

to

of

make

for

investment

Legislation?

Relations

mutual fund shares

ooor

a

businessman who can put money

security and investor "personalities"; to choose issues
for the investor as a tailor fitting clothes. Citing frequency

vestors

What of New Labor

auu; nsuauy.

time

same

b<*

ma^

proper

I

lac^s

vanapiy

investment adviser's duty to match

Market analyst asserts it is

prudent* manage¬
busy> doctor ih-

a

lacks the talent to supply for him¬

By LUCIEN O. HOOPER*
W. E. Ilutton & Co., Members,

of

benefit

the

ment of which

November.27,1952

:;.Thursday,

not

that
are

that

\

go

so

powerful

in

the

in

far

national

industrial
should

ernment

as

contend

monopolies
interest,

relations
be

unions, rather than

long

to

as

labor

an

or

gov¬

ally

of

neutral.. As

a

the above mentioned pro¬

vision stands, it is naive to

think,

all trappings notwithstanding,

that

the Federal Government is

true

neutral

in

industrial

a

relations/or

that continued industrial strife of

significant
continue

day.

to

magnitude
be

the

shall

order

of

not
the

Volume 176

Number 5172

.

.

The Commercial and Financial Chronicle

.

(2027)
tive economy be held
strong ant1

ing

dynamic.

More Trade—Less Aid!

assure

There
which

By J. P. SPANG, JR.*

have

ment

Mr.

Spang, advocating

more

trade and increased foreign invest-

ment, holds these developments would
world peace and progress than U. S.

do

more

and

them

phere,

of

mental

able

Points out private capital flows
where opportunities
exist, and it is essential that we secure
taxation.

*

Our best hope for world
peace,
for the better world we all
desire,
must

from

come

the

increasing

derive

There

own

why

self-created,

not

sound internal

cannot

these

and

should

for,

gating

dollars,

zation

their

the

recipient

No!

alone
the

sion
P.

Spang,

Jr.

answer.

While

our

of

financial

alive,

donor

guard

about

a

himself

against

they

cure.

must

his

have
And

not

the

constantly

own

economic

anaemia.

Two

is

We

a

courses

are

to

markets,

unrestrained

timidity
have

as

we

figures

demonstrate

before the world the ad-

of

our

system

over

General

By

^well

means, however, do I say
increased
domestic
invest-

Session

of

the

39th

National

New

York

Hewott He«




no

p«sened.

With
With

srs
so

11

addition,

'

\

initiative

mittance

re¬

of earnings and

the

patriation

of
capital,
and
for
prompt, adequate compensation in
the event of expropriation. Efforts
should
be, accelerated
for
the

elimination
ation

of

of

discriminatory tax¬

American

citizens

and

business enterprise through inter¬
legislation and international
treaties.

nal

,

I would like to
suggest
will
a "now-see-here"
—

beamed

at

countries

attract

often their

Certain

program
want

investments.

of

investment.

countries

need

some

healthy introspection. They
not beckon foreign capital

can¬

and,
time, discrim¬
against foreign citizens or
enterprises;
attempt
to
dictate
managerial policies; prescribe the
at almost the

same

inate

tory taxation.
is

also

do

the

and

can

consumption

more

effec¬

of

any

government operation

or

This

as

at

as

is

true,

home.

abroad

Further, I be¬

adequate to the

world-wide economic

mnr»h

The

at
Our
mych at ctakr*
stake,
our produc¬ 'hand,

f»'

advance.

Government's Role

government,
can

needs of

on

the

other

do much toward form¬

■

to

up

United

States

enterprise to demonstrate to lessdeveloped countries that much of
their

apprehension

foreign
must

capital is

show

investment

stitution

is

admitting

modern
far

a

from

adventures of

to

groundless.

that

different

the

We

foreign
in¬

exploitative

half century ago.

a

We must, by example, show that
United States enterprises are good
citizens

in the countries in which

they operate, contributing to the
social and economic improvement
of the community as well as to
government

the

can

is the
not

benefits

our

and

from for¬

come

own

country

outstanding example. It

too

many

years

ago,

was-

as

man

measures

time, that these United

States

America

of

was

unde¬

an

veloped country. Yet so swift was
our
development that we have
long ago forgotten our wastelands
which

now

wheat;

our

shine

with

virgin

golden,

forests

which
have given way to
towering cities.
These

the
of

accomplishments

have

not

been

possible

powerful financial
Great

and

railroads,
facturing

mines,
all

countries.

The

tors

manu¬

life

our

insurance

all,

—

part of their inception
from

came

"sensational"

foreign
the

great

our

establishments,

monies which

Canal

assistance
Our

banks,

our

our

had

would

without,

Britain, of Switzerland,

other

fully that

more

such

illustrate

eign investment,

policies hold back

own

inflow

if you

—

which

foreign

To

greatness that

invest¬

re¬

It

production

increased

of

scale

it is imperative that

£„( Wt

In

lieve that private enterprise alone
can furnish capital investment on

by private Capital should be

Foreign
Trade
Convention,
City, Nov. 17, 1952. ,

'

control.

a

ment

the

can

less-developed
economic improve¬

realized.

Private

form

police state.

by Mr. Spang at the First

us,

interna¬

capital

the

tively and economically than

the

one

open

of

of

for

be

greater

for

that
*An address

-

job

We

honest

substantial

a

flow

tageous.

world lead-

in

domestic

-

tending opportunities for the

1

accepting the challenge of free
competition.
Better
our
record,
and

.with

ex¬

to

both normal and mutually advan¬

our

as

equality

ment. It should work toward

percentage of domestic participa¬
regarded only as a flow from de¬ tion in ownership; restrict earn¬
veloped to less-developed coun--' ings or the remittance of profits;
tries;, international
investments i limit the availability of exchange
between developed countries are.- of profits; and impose confisca¬

inva¬

strong,

grown

nation—yes, and

viding for equitable treatment of
foreign investment on a basis of

foreign investments, should not be

would

to

low

foreign investment both

countries

markets.

alien

specially

network of bilateral treaties
pro¬

the

of

ment

only - to
but also

ers—through free enterprise.
have established the record

vantages

Our efforts must be re-directed,

not

of^their American

past.
a

system

blood transfusions may have
kept
the patient

brought

invite

This
J.

not

countries

at

enlarge the

They must realize

aspirations

American
industriali¬

threat

nationalistic

discrimination

effective partnership to
this advance. It should in¬
its efforts to

Despite these formidable fac¬
tors, we all recognize the impor¬

tional

uninvesti-

many

a

expropriation.

and

available

through

own

capital.

blind,

other

of

buck

to the United States and to coun¬
tries of potential investment. Only

un¬

of

foreign

would*

..

Dollars
are

of

constitute

of

our

new

risk
still

an

crease

tance

had

the

fear

or

good

countries.

is

absorb

.

businessmen that the

our.

good

own

we

atmos¬

rates of interest.-

expected.'.Some"of

or

to

economy

out

the

value

the

must

funds

has

internal. One is the

Another

either for

the

political

pression existing in many capitalimporting countries that public
lending agencies will make public

of reasons;

investment

precedented capacity of

not

pouring
S.

to

.*

are

continue
U.,

number

a

foreign

risen

hoped

We

economy.

are

our

war

against foreign investment. • Then
too, it is difficult to erase the im¬

complementing the other. They
are, first, a sharp increase in foreign investment, and, second, the

from

threat of

increasing govern¬
controls, and, in
some

tendencies

strength of friendly nations. Their intensified export of our industrial
strength must
and technological skills.
their

noted,

with

cases,

industries.

own

is the

legal1 and

We

ample supplies of foreign raw materials. Recommends furnish¬
ing foreign countries our own "show-how," and reducing tariffs
our

have

we

economic

are

foreign aid. Holds government's role should be limited to trea¬
providing protection to investments abroad and elimination

injuring

the sluggish¬
foreign invest¬

disruption,
inconvertible currencies, unfavor¬

ties

to extent" of not

As

deterrents

political uncertainty abroad.

Others

gifts and other forms of

discriminatory

caused

monies.

of

one

•

-

advance

to

other

*

in the flow of

ness

President, The Gillette Company, Boston

are

15

financing

was

of

success

the

of

of the

one

in

Europe.
Erie
for

reasons

willingness of foreign inves¬
to buy stocks and bonds in

United

States
companies.
The
Pennsylvania Railroad is another

outstanding example. In 1852, six
after its founding, Penn¬
sylvania needed to borrow $3,000,years

000

for

the "needs

of

its

fast-ex¬

panding system. A large share of
.

the

bonds

were
sold to foreign
(principally British, but

investors

also Swiss) through such English
banking firms as Baring Brothers,
the Rothschilds, and others. With
the help of foreign capital, the
Pennsylvania achieved a high de¬

of standardization

gree

ciency

relatively

and

early

in

effi¬

the.

"steam dynasty." This fact doubt¬
less had

great bearing on Penn¬
sylvania's ability to maintain an.
a

unbroken dividend record

during

the

190,00(1

depression

stockholders

000

shares

railroad

ating

for

some

owning

of

over

stock.

today in

The

terms

oper¬

the Pennsylvania

revenues,

Continued

revenues.

13,000,largest

of

on

page

32

»'"S
No

delay
to

or

lighterage,

no drayage. No charges, no hazards of
damage which these entail. Shipments go direct from car
car. Chesapeake & Ohio rails run alongside
ship.

ship—ship to

2. Large,
piers; two
other

efficient piers. There
open

piers,

one

are

four covered merchandise

equipped with gantry

cranes

for

handling oil; and two coal piers having
capability of dumping 12,000 tons of coal per hour.

3. Railroad
tion

where

facilities for 10,300

congestion

might

a

and the

combined

cars. These prevent
conges¬

paralyze

freight

movement

and

bring disaster to shippers.

4

Strategic location. Through this port shipments flow by the
shortest route between
Europe and many large American produc¬
tion and distribution centers.
save money

5.

on

By shipping via Newport News
freight rates from midwest and south.

you

34 million cubic ft. of warehousing. 113 warehouse units

in the Newport News area provide
storage capacity for 10,000
carloads of freight at moderate handling, storage and insurance
rates.

6*

Efficient handling equipment. Hundreds of skilled and
willing employees work at the C&O piers with a full complement
of cranes,
and other

hoists,

conveyors,

pipe lines, trucks, tractors, trailers

equipment to aid rapid, safe handling of

every

type of

freight.

7.

Rail connections.

and

A web of rails connects piers, warehouses
Chesapeake & Ohio lines. More than 5,000 miles of C&O track
with other lines to reach every corner of the continent.

tie up

8« Coordinated

facilities protect shipments, prevent delays,
a minimum, make it easy, convenient, economical
shippers to use this port. Originated in its entirety as a
Chesapeake & Ohio project, Newport News is part of the C&O
pattern for modernizing rail-and-sea transport.
keep charges at

for

The World Commerce
tors

on

General

Department of the (hesapeoke t Ohio system is fully equipped to help exporters, importers, forwarders and
ship op£T3»roil and ocean shipping of foreign and intercoastal freight. If you have a
problem, contact G. C. Marque
Manager, World Commerce Department, Chesapeake t Ohio Railway, 233
Broadway, New York 7, N. Y., or any C&O representot'.

all problems related to

b

PROGRESS

THE

CHESAPEAKE

and

OHIO

R AI

Iff

The Commercial and Financial Chronicle... Thursday,; November 27,1952

(2028)

SECURITY TRADERS

OF DETROIT AND

ASSOCIATION

MICHIGAN

COMING

Michigan,"

of Detroit and

Securities Traders Association

The

held its annual fall dinner at the Detroit Boat Club the

evening of

EVENTS

Nov. 18.

Notes

NSTA
SECURITY

TRADERS

ASSOCIATION

OF

The group was honored

by the presence of Harry L. Arnold
of Goldman, Sachs & Company, New York City, who is the newly
elected President of the National Security Traders Association.
Also attending the function were H. Russell Hastings of S. R.
Livingstone, Crouse & Company, Detroit, who is the immediate
past-President of the national organization, and Mr. Edward H.
Welch of Sincere & Company, Chicago, 111., who is also a past-

ORE.

PORTLAND,

Portland

The

Security Traders Association held its monthly
get-together in the French Room of the Old Heathman Hotel on
Thursday, Nov. 20. Dan V. Bailey, manager of the trading de¬

President.

Not. 30-Dec. 5,1952

(Hollywood, Fia.)
Annual Convention at the

Security Traders Association will hold its annual
Christmas party on Friday, Dec. 5, at the Olympic Bowl.
The
festal occasion begins at 5:30 p.m., with dinner at 7, followed by
the tops in entertainment at 9.
Reservations, and checks, should be sent to Sidney J. Sanders,
Foster & Marshall, 802 Second Avenue, Seattle 4, Wash.
Tariff
is $15 per plate.

The Portland Association also voted unani¬

invite the 1953 NSTA Convention
group to visit them next fail.
During a tense contest of skill between
mously to

Holly¬

(New York City)
Association of New

Dec. 4, 1952

The Seattle

plants in the territory.

Association

Investment Bankers

wood Beach Hotel.

SEATTLE SECURITY TRADERS ASSOCIATION

partment for Foster & Marshall, President of the Association pre¬
sided. Mr. Bailey announced the Association's
plans to continue their visits to industrial

Investment Field

In

Investment

York Second Annual Dinner at the

Waldorf-Astoria.

(New York City)

Dec. 5, 1952

Security Traders Association of
New York annual meeting at The
Antlers.

John

Galbraith, Camp & Co., and Bob Pitt,
Blyth & Co., Inc., at the Nov. 20 party, Dick
Adams, manager of the trading department of
Donald C. Sloan & Co., offered a notable for¬
feit if Pitt won, in view of his dim position.
Bob won, and Dick paid his forfeit—for pic¬
tures

the

and

George F.

complete

inside

story,

Dec. 5, 1952 (Seattle,

Securities Salesman's Corner

The

it.

Some years ago a very success¬
investment
broker
in
New

who recorded the event for
posterity with his handy camera. Also avail¬
able are prints of Dick Campbell of the First
Dan V. Bailey
1
National Bank of Portland, who revealed, all
six feet four inches of him, a remarkable terpsichorean ability.

ful

York

City said to
of

the

business with

our

that

most

"I

me,

people who

see

the

serving

are

we

other

any

mer¬

chant.

sure

am

You

public—just like

As¬

annual Christmas party

Olympic Bowl.

,

1952( Boston, Mass.)

Dec. 10,

Patten, Jr., George Patten Invest¬

Wash.)
Traders

Security

sociation
at the

By JOHN BUTTON

contact

ments, Portland,

SAN FRANCISCO

Seattle

Boston Investment Club annual

Christmas party at
Club.

the University

do

Dec. 11, 1952 (San Antonio, Tex.)
But There Is Something Wrong
actually do
Investment Women of San An¬
With This Picture
not understand what it is they are
tonio Annual Christmas Party at
Then he went on to tell me:
trying to do."
I asked him to
the Party House on San Pedro
explain exactly what he meant This is all O. K. as far as it goes,
Avenue.
by this. And this is the way he but there is one thing wrong
put it, as clearly as I can recall with this whole set-up. Many of Dec.
12, 1952 (Pittsburgh, Pa.)

SECURITY TRADERS ASSOCIATION

Nominating

Committee of the San Francisco Security
Association, consisting of Thomas Price, McAndrew & Co.,
Chairman; Elmer Weir, J. Arth & Co., and Emmett Whitaker,

Traders

firm

the gist of his remarks.
The

curity

dealer
w(ho

man

and

what

se¬

runs

it

is that

not understand

they really want

from their investments.

almost like a
a
hardware, a
other kind of

is

customers do

our

broker

average

from

day

to

Pittsburgh Securities Traders
Association

They live dinner
They have

day.

annual

election

and;

at the William Penn Hotel.

sat down with anyone

who Dec. 19, 1952 (San Francisco, Cal.)
give them an objective,
San Francisco Security Traders,
door
open, we
invite customers honest, and Unbiased diagnosis
Association annual
Christmasto come in and
buy stocks, we of their financial needs and. their
party at the St. Francis. Yacht
send them advertising literature, investment situation as it actually
Club.
;
we put ads in the papers and we
exists.
After all, we are not in
employ salesmen to call on those the same position as other mer¬ Jan. 16, 1953 (New York City)
who have shown an interest in chants.
We can't leave things to
New York Security Dealers As-^
grocery,
or any
retail establishment.

We

have

never

could

a

;

.

,

,

investing.
We also have custo¬
mer's
representatives
who
are
hired

the public, and they render cour¬

Walter

mistakes that will be very costly
to them—not unless someday we

teous
Earl Thomas

the untrained judgment of people
who
are
liable ; to
make some

care

the

Vicino

for
and

in

hold

customers'

Vice-President—Walter Vicino, Blyth & Co., Inc.

dividends
when

Union Trust Co.

received,

comfortable
Directors: John C.

Hecht, Jr., Brush, Slocumb & Co. Inc.; Wil¬
liam J. Bailey, Wilson, Johnson & Higgins; William G. Faulkner,
Wulff, Hansen & Co.; and Frank Bowyer, Schwabacher & Co.,
the retiring President.
The

Association

announces

that

its

Christmas

annual

will be held Dec. 10 at the St. Francis Yacht Club.
be served

at

6:00

p.m.,

with dinner at 7:30.

be made not later than Dec. 5 with
&

Cocktails will

OF

NEW

who

Montanye,

O'Mara,

_1

Gavin

___

35

.

34
31

30
23

Hank Serlen——231
Arthur Burian
Jack

Barker

——_210

Thanksgiving prizes
handicap:

were won

our

«

day

sit

watching

few very .substantial spec¬

-

-need

never

They

come

buy and

near

and

in

case

sell

ac¬

no

need,

may

some

too

many

views

own

and
of

service^

in

the way

Then

of

annual

and

and

cer tain—if
we

leave

run

we

it

up

to

may
our r

find that someday many

customers will not be too

chased and then they will blame
us,

the merchants, for their plight.

it within an
Jack Barker 401

the

move.

difficult

SECURITY TRADERS ASSOCIATION OF NEW YORK

New York
«

City.

-jt

■

' ■■

A buffet dinner will be served.
ijL f'

■<'-* 'V




V

others

,

•

*♦

Securities

have

90

Corporation,

Street,

New

appointed

York City,
Emmons W.

ViceMr.
Blodgett, who has been with the
organization for eight years, is
Blodgett

as

President

with

the

Assistant

an

of

the

company.

Business

New

Depart¬

ment in New York.
*

*

.

San Antonio Inv.

•

hour

or

two

column

before

^

These people are quite
to

who

,

please. ;
j There
desii;^i^pec^l

next

week

will

start

a.

this

series, of

articles that will attempt to

wit^out working

very

ex-

1 plore this -whole subject Cerbe offered

information that they believe. will^> violative

to the development of

plbser^ relationships between in;hard i for . ^^totment inen and tkeir clients.

help them to make some

money

members of the club, invited
guests include all other employees

40

of

investment

Antonio.

-

houses

in

San

V

New^ York Stock Exch.
;

Weekly Finn Changes
The New York Stock Exchange

has announced the following:
,

Beginning

they expect to be told about

.

Antlers, 67 Wall Street,

ster

happy with the goods they pur¬

have

we

thing is

Ernie Leinhard 406

annual meeting on Nov. 5 at 5
p.m. at the

The directors of Stone & Web¬

Broad

securities markets—people

buy

Stone & Webster

day

the public to buy what they wish,

those who expect us to know just
when a stock is going to advance,

The Security Traders Association of New York will hold its

Blodgett Officer of

1928 and 1929,

be that people
idea of what they

they bargained.

store

the

we

little

very

speciai

Hank Serlen 433

•*

after

National Security Traders Asso¬
ciation 20th Annual Convention.

not be caused

may

speculative
stocks—people who say they want
income but try for capital gains—
people who try
to have their
cake and eat it too—people who
indulge in wishful thinking re¬
garding securities — people who
just jump in and buy this and
that on meager
information or

of

who

the

have

the

who

one
a

office.

^

Jack Valentine 431

*«•

in

special

a

It

People who continue to overbuy

a

Hoy Meyer. "
Richy Goodman
by the following in

those

ulators who

Hank Serlen

Richy Goodman—_208

for

have

cording to their

George Leone

220

looking

day

have

5 Point Club

.

our

kinds

see

get something else than that for

comes
in,
sometimes

all

will

could well

which

go

run

you

,

34&

(Capt), G. Montanye, Voccoii, Siegel, Reid——
22
Growney (Capt.), Craig, Fredericks, Bies, McGovern—— f19%
Krisam (Capt.), Ghegan, Jacobs, Gannon, Cohen_—* 17
Point Club

we

American

of

Women's Xmas. Party

Barian

200

good

a

it

Association

points profit they feel good, and
tips—peopld^ without $ plan for
when the paper profits evaporate
watching
thelf securities after
they don't feel so well. Yet they
they have bought them—these
SAN ANTONIO, Tex,—The In¬
keep coming back, and occasion¬
are the things that are unsound
vestment Women of San Antonio
ally they make a change or two in our business.
~
will hold their Christmas party bn
in their list Of stocks, and we
This was \ the way he put it— the
make a
commission.
We have
evening of Dec;111, at the
other customers; that only invest not his exaqt words but such was Party
House ' on
San Pedro
when
they have some surplus the intent of his thoughts. ; There Avenue: This year's party, which
has become- ah annual affair, will
money. They call us and we give
may be many who disagree. But
them some suggestions. We also
be a dinner dance. Besides the

37

—

are

we

chalk marks chase each other up
and down. When they have a few

Pollack,

Meyer (Capt.), Kaiser, Swenson, Frankel, Wechsler, Barker
Stolen (Capt.), Gersten, Krumholz, Rogers, Gold, Young--1
Goodman (Capt.), Smith, Valentine, Meyer,
Farrell, Brown
Mewing (Capt.), Bradley, Weseman, Hunt, Gronick, Huff—
Leone " (Capt.), Greenberg, Tisch, Werkmeister, Leinhard,
Corby
Bean (Capt.), Frankel, Strauss, Nieman, Bass, Krassowich

have

we

We

here

38

Manson, D.

was

but

We have bargain hunters

are

sale.

39

Demaye, Whiting, O'Connor, Rappa, Seijas
(Capt.),. Klein, Weissman, Sullivan, Murphy, Sea-

as

they buy.

YORK

Donadio (Capt.),

the public
around, and

and

browses

Points

(Capt.),

investors
nicely; we

rather

store

Reservations should

Team—

right
Murphy

of

ahead

Security Traders Association of New York (STANY) Bowling
League standing as of Nov. 20, 1952 are as follows: -

Hunter

attracting

following

party

George Kammerer, J. S. Strauss

ASSOCIATION

If

more.

in

Texas Group Investment Bank¬
ers

by over-reaching of credit, such

of¬

want

do arid

we

or

in the securities markets

again.

this

successful

May 7-8, 1953 (San Antonio, Tex.)

Spring Meeting at the Plaza HoteL
bit too far
later, if you give Sept. 14, 1953 (Sun Valley, Idaho)

sooner

once

Dinner at

a

public its head,

excesses

we

as

27th Annual

the Biltmore Hotel.

in the 'thirties. This: may

but

out

air-conditioned

criticism such

and

the

who

Now,
buyers.

TRADERS

them

sociation

through another period

carrying things

fices in the summer, and they are
well heated in the winter.
All

Co., Chairman.

SECURITY

send

did

be

them
collect

we

to go

censure

we

furnish special
reports for tax purposes, we have

&

Bank

and

of

securities

send

statements

Fargo

to

offer.

we

safe-keeping, we
monthly,

President—Earl Thomas, Dean Witter & Co.

Secretary-Treasurer—Maury Kessler, Wells

meet

to

attention

services which

We

tor 1953:

ability

prompt

requests for information and

other

Davis, Skaggs & Co., have nominated the following slate of officers

their

-

Transfer of the Exchange mem¬

bership of Albert P. Hinckley to
Stanley M. Roth will be con¬
sidered by the Exchange on
Dec. 11.

Transfer of the Exchange mem¬

bership of Thomas L. Perkins to
will be

Robert

G.

sidered

by the. Exchange Dec. 11.

Howard

con¬

Volume 176

Number 5172

...

The Commercial and Financial Chronicle

(2029)

From

Washington
Ahead of the News

Vice-President, Chamber of Commerce
Mr. BuIIis

But

put

our

the

has tended

press

accent

than

principles, at least in the news columns. Her¬
bert Hoover, when he was President, used to
complain that the Washington correspondents
were

interested

more

in

the

among politicians and

political parties than

the

He

issues

strongly

stake.

at

had

to

reason

on

proposition

of

hours

Washington

chief

feel

whether Borah

or

able

Loss.

ponents would be able to kill it.

You have

only to observe what has

on in
see

the selection of the General's Cabinet to
what is in store for him and the Senator.

There

to have been

seems

as

much

news

Bargeron

interest in whether the

appointee was a Taft man or a Dewey man
appointee's ability or standing. The Senator

there

as

was

was

in

the

represented

as

bent to say that while
a man for every Cabinet
post, at the time of his statement,
only one recommendation, that of Secretary of
Agriculture, had
been accepted. At the same time he made it
plain that he considered all of the appointments
satisfactory. He was not in the
slightest miffed.

quest

The plain fact is that the Senator
fully recognized the right of
the General to name his own official
family. Every President is
allowed wide freedom on that.
He did not consider his much

publicized understanding with Eisenhower at
Morningside Heights
during the campaign that Taft supporters would not be discrimi¬
nated against in
patronage, as denying the General the right to
name his own official
family. The agreement was understood to

the broad field of
patronage. As a matter of fact the Senator
surprised when he received a request for
recommendations
for the Cabinet and it is doubtful if
he took this request too seri¬
ously, as anything more than a nice gesture. Thus it was
that he
recommended Senator
Harry Byrd for the Treasury post only to
see it go to a man about whom he
had not been
consulted, but who
nevertheless was a "Taft man," a close
personal friend and a man
cover

you

outstanding ability.
It can be easily understood that his
feelings would have

been

his Cabinet with Dewey

men

aroused had Eisenhower loaded
up
but the General has not done this.

Taft is not

a

small

man

and

there

is not the slightest doubt
that he has every desire to
cooperate with the new President. It
Is

fact, too, that he has

a

differences between the
one

who would

and Eisenhower

never

two.

cut this

seen

To

fundamental

any

picture Taft

as

an

country off from the rest

political

isolationist,
world,

just the opposite, a world
cooperationist, was
one of the greatest
pieces of bunk of the pre-convention
campaign.
On domestic affairs, Taft is
probably more liberal or he has come
tional affairs the

about
I

as

growing indications

realistic views

think

the

as

General's

is not

and in interna¬

that Eisenhower has just

selection

of

as

General

Motors'

indicative of this.

Charlie

Mr.

Wil¬

garrulous man, not given to going around the
country
making speeches at the drop of a hat. Two of the few times he
a

has spoken in recent months he uttered

one of

those "whither

are

we going" warnings in the matter of
foreign spending. I do not
claim to be quoting him
exactly but on each of those occasions he
spoke about "Colonialism in Reverse" and said that while
other
nations had exploited their colonials for the
benefit of their own

citizens,

the first nation in the world to
exploit its citi¬
for the benefit of the colonials.

zens

we

were

This sort of realistic
Cabinet.

new

of isolationism

one

but, instead, one of using

most

versus

some common sense in

spending, Mr. Wilson is going to be out

healthy in the

that the issue in this

of

internationalism
our

international

place in his official

I believe the General does have this
realization; further¬
more, I think the Europeans realize the gravy train has
passed.

time before their tempers get loose and

v/e

have

a

first class party

And I expect there will continue to be this effort.

Let's
the

With

(Special to The Financial Chronicle)

BOSTON,

Mass.—Edward Fitz-

gerald has been added to the staff
of Schirmer, Atherton & Co., 50
Congress Street, members of the
New York and Boston Stock Ex-

Chace, Whiteside

river

economic

Our
our

and

walking for
down

not

are

factors

the

the

of

main

country.

factories, our laboratories,
companies, etc.—vital as they

to national economic strength
—are
not
the
deciding factors.
all

-

strength

powerful
to

s o u r c e

constitute

the
nomic units of this
people

have

vote

a

of

dynamic

eco-

country. These

given

the

General

confidence.

They like
him personally. They respect him.
But

he has to face the downbeat

~

of

doubt.

They want to know what

about

their

their

their

jobs,

savings

doubts,

the

have in

his

economic

mass

their

accounts

of draft age.

sons

of

next

President

Council

namely,

and

insecurity,
instability

unemployment,

of the

business cycle, and failure
to contain Communist aggression.
These

lar

millions

of

workingmen

their families and white col¬

and

workers

and

their

families

suspect that the situation is ripen¬
ing for a recession during the
next

year

and

or

two;

obviously

but I

they

men

the

thoroughly
best

believe,
believe too,
with

conversant

economic

technical

know-how

procedure,

daring to sustain

fluctuations,

on

a

theirk

Know-how, foresight,

the

Boston

changes. He was previously with

change. He

Ballou, Adams

was

&

Stock

previously

Co., Inc.

Ex¬

daring—

The

have

we

false

with

statement

i?,g °.f

by Mr. BuIIis

masses

of

theB°ar<*

f,aa,™ No^

of

at

Directors

been

has

given

public mandate.
free

a

the

suspicion of

Today

history

business

clear-cut

a

prove

hand

former

to

public

short-sightedness.

our

have

greatest op¬
portunity to prove that the aims
we

our

of business and the welfare of the
American
public
are
the. same

thing.
How

are

How

which

is

com¬

Business

By making

Must

the

tract

being

a

This

meet-

of

the

possibly

saving

institutions

into govern¬
In that way, we can

ment bonds.

soundly finance
Federal
riod

slightly

rate of interest will at¬
the
funds
of
savers
and

needs of the

any

Government

when

defense

in

the

pe¬

expenditures

declining and we are endeav¬
oring to... build up the*. national

are

income

and

total

productivity to

These

are

the three

policies that

I think we should seek.

Act

moral

flation.

higher

con-

assure

will not have further in¬

we

keep employment high.V

going to do it?

we

of credit which will

'

climate

They meet the public's wishes
we
stop inflation and have

of the business world better than

that

it

full

has

been.

ever

By

realizing

our

that the windows of

factories

today look out on the entire world
its alarming confusion.
By

employment.
By adequate
credit policies we enforce

tight
"No

Inflation"

and

although

saying to the workingman and
the white collar worker and their

Auction,

families
and

the

that

American

American

much

this

in

industry

business

fight

are

as

they are—
fight to make, not only our
as

country, but the entire world

The

most

practical

ourselves

prove

new

his

,'hand

the

he

as

terrifying

him.

is

to

President

our

But

way

to

stable
not

if

just

look

strengthen

tries

to

solve

security for

all,

few4-Americans—

a

out

rates

for

the

time

four

from now when those same
hopeful millions, who have just
given business its greatest oppor¬
tunity, will turn from us in disyears

illusionment, and will vote

us

out

a§ain-

tax

By

necessary.

re-

make certain that

we

we

ployment.
Here

is

believe

a

program

General

which I

on

Eisenhower's

Administration and Business

can

agree.

Charles Jank Pres.
Of F. Knowlfon Co.
OAKLAND,
Jank

has

succeed

Calif.—Charles

been

Frank

of

elected

Knowlton

Eugene

V.

recently passed
has

been

Knowlton

&

with

for

the

to

who

Mr.

away.

Co.

Co.

Flood,

connected

E.

President
&

Jank
Frank

past 25

years and has served as Executive

Vice-President
four
the

Board

Athens

of

the

during

He

years.

is

Directors

Athletic

last
of

member

a

the

and

Club

of

has

served in various executive capa-

Now

new

our
rule,
higher inter¬

keep^ total economic ^activity high
so
that we can sustain full em¬

problems
facing
businessmen
are

economic

for

then

est

as

make

we

get behind

to

going to relax into being a group
of "Agin-ers" — stubborn Tank
Traps along Ike's path to inter¬
national
harmony ^hftd to more

I

Yet 20 years ago a ground swell
doubt oanisned
aouot banished business ideas
ideas

businesmen

trol

what

should

be

the

total

cities,

ward

destiny. Certainly American business
has proved to the country
that it knows
the meaning
of
those pulsating words.

*A

interest

of

United

eco¬

fears

those three words spell American

Government.

recent

program of a

States

in

big busi-

relation

to

the

Administration?
think

there

are

other

and

three

desir¬

able steps

in that program.
First, Business and Administra-

tion should pledge, unequivocally,
without qualification, to stop mflation, now that we know how
t° .d°
We know that very
serious inflation resulted from the

officers

S.

Goetze,

Mrs.

Dora

R.

Wil-

has

an

Vice-President

McClelland,

retary-Treasurer.
also

H.

are:

Vic.-Pre.dent, Ed-

The

Sec¬

company

office in San Francisco.

With Blyth & Co.
(Special to The Financial Chronicle)

DETROIT, Mich.

—

Edward J.

affiliated with

loose fiscal policies of the Roose-

Blvth
rarr 1S now anuiatea wnn mytn

velt„Truman Administrations,
there has been no inflation

& Co., Inc., Buhl Building.

cently, and

we

—

of

rate

'»™.

reactionary, against social prog¬
BOSTON, Mass.
Henry R.
Newitt has become affiliated with ress, tarred with standpat phi¬
Chace, Whiteside, West & Wins- losophies, being isolationists in a
time
of
need
for
world-wide
low, Inc., 24 Federal Street, members

to

The final step in this threepart program is to keep credit
policies sound and to offer a

ciSfof KreSS, 3 £

will be proved unfounded.

from

productive plant

our

Sound Credit Policies Essential

high

enough

that

saw

almost

we

operating at only 67% of its
capacity,

economic

foresight to mitigate drastic
nomic

ployed and

who

men

level of employment and

in

must

of Economic

economists

are

—

leaders

free.

acutely sensitive
things'that trouble millions

voters

mass

such

their

and

To check these

key positions industrial

to the

statements

black—indirectly

or

We

worse.

when

was

"

American

own

eminent

leaders who

decide

business

us

Never

homes,

Advisers

other

who

annual

1937

had a
balanced budget, yet we had over
eight million Americans unem-

put
leader

millions

red

in

that

any

white collar worker and his fam¬

ily

maintenance of

"
better.

these

not

the

to

all.

and

great

our

of

Administration
things, or us. The
American
workingman and the
workingman's
family
and
the
is

enough to offset cuts in tax rates.
Expanding the tax base is equiv¬

patible with that reasonable

Now

ourselves

are

The

who

Only by this method can the
budget be balanced. It will expcfnd the tax base more than

new President
carry out
their hopes for that
change for the

will

getting too self-in¬

by
We

suspected

(Special to The Financial
Chronicle)

Blair, Rollins & Co., Incorporated.




to

sell

not

terested.

of
ot

Joins Schirmer, Atherton

back

we

saddle

this

the rest of your lives."

the

Eisenhower-Taft relationship, if there
is going to continue to be the effort to
analyze each statement or
action of one as to how it rests with the
other, it will only be a

split.

Fail, and

out of
go

have the

family.

But to get back to

to im-

years

that if Ike surrounds himself with

thinking should be

If the General doesn't realize

country has not been

can

all

help the

four

you

the economic and interna¬
'
1
^
you

be

change

a

in

our

elected

in

Taft.

Wilson to be Secretary of Defense
son

Eisenhower,
are

Harry A. BuIIis

music

of the

as

to bend more in domestic affairs than

will

us.

on

wanted

whether

about

tional situation.

was

of

who

the things that

drag-

the

the world. They
that the millions of people

forget

fellows

prove

is

shut the economic window

same

We'll give

men

to do

and

can

that looks out

what

worry

Those

have

offices

was

do

new

job in our
factories. They think

*—the

can

came

our

businessmen

we

to

hopes

you

or slighted, every time an
ap¬
to the point that he felt it
incum¬
he had recommended at the General's re¬

It

back

their

pointee

announced.

get

let's

being pleased, displeased, ignored
was

that all

simply—"Now
see

inflation—for

high, productive employment for

we

at¬

titude

the

the recession

to

answers."

their

be

In contrast, trying to keep the
budget balanced in the face of a
slight recession will only make

reason

be¬

the

should

activity
are
kept • at
high levels which will as¬
high productive employment

alent

Some

step

of

into the White House.

the

No,

Carlisle

the

everything now is hunkeydory, just because Ike is moving

lieve you fel¬
lows have all

gone

profit

think

and

"We

say,

the

of

next

—without

Responsibilities of Business

of

But

version

opportunity.

been

wish to work.

system.

Let's face the facts of

voters did not

tude, needless to say, encouraged obstruction¬
ist tactics rather than cooperation.

sure

forward to

Risk

Profit

of Hoover's other op¬
Such an atti¬

some

the

System

selfish

own

and for

once

always

business
those

thinking, and subscribers to their

climate

for

among
the
would focus on

look

can

long wait,

a

favor¬

more

a

interest

correspondents

have

result and after

a

businessmen

He could advance a
international importance, but

within

voters

put General
Eisenhower in the political saddle,
As

the subject.

on

24

The

competitiveness

favorable

more

the outcome of the

to

has

taxes, slowly, care¬
fully, prudently, so as to make
certain that employment and total

election, they should not look
only to their selfish interests, but should work to prove that
aims of business and public welfare are one.
Suggests as pro¬
gram: (1) a pledge to stop inflation; (2)
gradual reduction of
taxes; and (3) institution of sound credit policies.

in recent years to

more

rather

personalities

on

and

more

The

lowering

of the United States

businessmen, in viewing the

warns

climate due

things, if General Eisenhower and Senator
Taft go for a year without an open split it will be a miracle. And
it is not in the disposition of either man to
bring it about.

ended

are

This

policy of both the Republican
Party and the National Chamber.

By HARRY S. BULLIS*

of

nature

all.

Chairman of the Board, General Mills, Inc.

By CARLISLE BARGERON
the

In

the dollar

Lest We Forget!

17

used

to

hower's
tion

stop

pledge

reservation,

re¬

know the methods
it.
General Eisen- *

Republican

should

but

and

should pledge its

this
the

and

the

(Special to The Financial Chronicle)

without
Chamber

full support of
that

the necessary measures to see

inflation

John G. Kinnard Adds

Administra¬

cheapening

of

MINNEAPOLIS, Minn.
ard
to
&

M.

the

Sarich
staff

of

has

John

—

been
G.

Bern¬
added

Kinnard

Co., 133 South Seventh Street.

18

The Commercial and Financial Chronicle

(2030)

Summarizing,

prolonged

A

eco¬

match

and

depression, provided properly balanced monetary

policies

A

Reduction

bank deposits in this country is
have predicted a prolonged pe- controlieu to a very large degree
riod of sharply reduced industrial by the credit policy of banks—
activity, with accompanying un- the
freedom with which they
make loans or buy securities. This,
employment,
in
after the peak
turn,
is
controlled
by the
amount of Federal Reserve credit
of
defense

-economists

prominent

Many

production is
passed.
They reason
that

and any

the reserve require-

outstanding,

set, the prevailing official
attitude toward credit expansion,
ments

(1)

as.

plus

exercises

also

the

on

(2)

1n^n

than
before;

higher

total

business

sion

equipment

experienced unprecedented
expansion since 1945, and (3) the
rate of family formation is expected to decline; therefore, a peof
ot

.

he

r/ent \viin
ment with

that the nation owns!

durable

more

ave

goods and produc-

equipment

per

than

capita

However,

before.

ever

it.is*ob-

millions of fam-

vious that many

ilies still want and need more or

Moreover, a great
equipment and
structures have been kept running
able

obsolete

of

meet the emergency

to

bank

the

However,

snarp

ti

thp

25-19

1946

19

2.17

.90

25-18

1945

18

2.20

1.70

1944

18

1.25

1943

17

1.47

1942

16

2.00

1.00

1941

14

1.38

.80

in

in

mem

m3 to l967( in_

nuaIly Dec...l6>

Dencnng

p

maturity

on

'

'

Steam

by -new standard-gauge railroad
eqUipment estimated
,

cost not

to

Issuance

«« 000 000

th

ess than

^00^00.
certmcates is suoject

me
authorization

of

to
Interstate

the

1952

a

ahnnf

gt

'of 81distributors

a

-

GreS°ry

&

bon

lnc-'

Mc"

a Master Hutchinson & Co.; Wm. E.
and

oro-

prediction that the nation
up
heyond the level which
is
heading into deep and pro- mjght be considered supportable
longed depression in the face ot Py
existing money supply. Althese
great
unsatisfied
needs, though the money supply also inbolsters the
Communist propa-t creased, it lagged. behind parity
ganda that our Free Enterprise wHh the increase in gross national
System cannot run at capacity for product

Pollock & Co- IncBlair
& ^ and First of Michi®an Corp'

The

long; that the "diversion of purchasing power into hoarded profits
inevitably
cripples
sa
s
capitalistic
widespread

economy,

causing

unemployment

mpinwhi1e

wiHpIv

thp

forest

velop, and

^

Qf

an

Although

us,

each

tight money. Moreover
period of tight money since
War I has been brought ab
of

the

monetary

y

authorities for the

purpose of deflating the price of
commodities or securities
This

happened in 1920, in 1929, and in
1937
Excessive monev tightening

forcing

a

tighter

money

1948 would have

has

Patrick

affiliated

become
™

J.

& ^"r^nf
^ 5e
lyr

the banks generally, despite
opposiUon of the ^ ^ Treas_
ury
No criHcism 0f any single
credi|.
poncy is implied, since,
,

.

•

.

&

Helen J- Getter Joins

Dempsey-Tegeler Go.
ST.

to

The

LOUIS,

Financial

Mo.

Chronicle)

—

Helen

which, taken collectively, consti- Dempsey-T e g e 1 e r & Co., 407
tute the program which must bal- North Eighth Street, members of

the New York and Midwest Stock
Exchanges. Miss Oetter was formerly manager of the trading de-

result.

vail and

o

all

annual increase
4% in the money supply
average

isome

-currency
necessary

and bank deposits-is

in-

to accommodate the

creasing needs for a medium of
exchange
which
matches
the
country's growing productive capacity and the demand for liquid
cavings. When the money supply
expands too fast for the needs of
the economy, higher prices follow,

The

growth

of

and

currency

t

.

/.

..

government

intervene by clamping
trols

on

would

new con-

prices and profits and by

WllSOrt, JOllllSOn
(Special to the Financial chronicle)
SAN FRANCISCO, Calif.-^-Paul

«.»«if)St»tteACnt ^yMro/essprfHfKf ri*- massive, wasteful spending. The T, Wemple is how with Wilson,
tionai Association of "nve^tmerit
clubs", Pufc)lic *s completely unwilling to Johnson & Higgins, 300 MontDetroil, Mich., Nov. 8, 1952./




.

'

see

This repre¬

contemplates spending $55 mil¬

company

On Sept. ,318, 1952, Columbus offered 90,000 shares of $4.65
preferred stock at $100 and 300,000 shares of common stock at
$24.88 through Dillon, Read & Co.
The recent financing, together
with the $19 million bank loan recently raised, are expected to
supply all the funds needed for construction until the winter of
1953-54.
The dilution resulting from the common stock issue is
fully reflected in the earnings for the 12 months ended Sept. 30, of
$1.98. However, the recent rate increase would have the effect ofadding about 40c on a pro forma basis, raising the figure to $2.38
pro forma. There would also be the advantage from the use of the
funds which should

construction

work out through the interest credit
through actual operations.

later

and

on

some years had troubles with
Columbus over transit and electric rates.
In 1949
Columbus set us a separate company (Columbus Transit Co.) to
operate the bus and trolley coach business in Columbus and its

City

of

suburbs, acquiring the company's 5% mortgage notes and com¬
stock in connection therewith, which securities are pledged

mon

under Columbus'

authorized

own

fix

to

indenture.

The

City Council ot Columbus is

transit

5c basis

despite rising costs; the nickel fare Was apparently
politically desirable, and the company was permitted
to maintain higher electric rates as a compensation.
However,
when the City of Columbus undertook to continue the low fare for
a five-year period, this precipitated a period of
litigation with the
a

fares were gradually raised and
straight, authorized by ordinance. -

company;

This

serious loss of potential pro- gomery Street..

now

approximate 10c

dispute also reopened the basic question of electric rate

reductions.

In the fall of

1949

an

electric rate ordinance contain¬

ing rate reductions, chiefly residential, considered by the company
to be excessive, was enacted by the Council of the City of Co¬
lumbus and later approved by the electors of that City. The com¬
pany, continuing to charge its old rates, appealed from the City's
rates to

new

the Public

Utilities Commission of Ohio.

While the

appeal was still pending, the company and the City Council in:
1950 agreed on an ordinance containing new rates for residential,
commercial

and

industrial

customers

retroactively effective to
by the electors of the
City, was approved by the Commission as a settlement of the
appeal proceedings. The 1950 Columbus ordinance continued the
Nov.

1949.

15,

substituted

This

ordinance,

approved

residential and small

commercial

rates

for

three pe¬

riods of two years

each, the first beginning Nov. 15, 1950, subject
by either the company or the City at the end of
any such period.Industrial and large commercial rates were
transferred to the jurisdiction of the State Commission at tMs
time and about a year later the company asked the Commission

to termination

for

an

increase

such rates, which increase was approved and
Aug. 14, 1952. The annual amount of this in¬
in net earnings per share of common stcck is estimated at

became

_

the

The

1947.

lion during the years 1952, 1953 and 1954.

J.

although sometimes delayed by
price control. When the expansion in the money supply does not
keep pace with the country's requirements, falling prices, falling
profits and eventually recession

Long-term experience indicates
that

1,

considered

partment for Friedman, Brokaw
ing sufficiently to meet the re- & Co., and prior thereto with
quirements of the economy. In Blair, Rollins & Co., Incorporated,
this event a major downward
P™e adjustment would be unGeorge E. Abbot
avoidable and a depression likely.
Vice-President
The nation would again have un- 0f Harriman Ripley & Co in
6
""" charge of their Boston office"
sausnea neeas.
passed away suddenly Nov. 23, at
Analysts of the radical left and the age of 56, following a heart
the reactionary right would alike attack.
"
blame durable goods market saturation, rather than restrictive
With James Ebert Co*
credit policy. Left-wing politifinancial Chronicle)
cians would proclaim that "Free
_*
T
enterprise has demonstrated its
^tibri.,u, laiu.~James
inherent instability." Ultra-con- F. Bufiy
been added to the
servative politicians would say, start or James Eoert company,
"Let's sweat it out." However,
Gnester Avenue,
the conservatives would not preli/uu u/:i.rt*4

1949

years.

1953.

on

various credit and fiscal policies Oetter has become associated with

fairlv severe recession

total of $61 million in the past five

a

late in

construction,

Warner & Co., Inc.

(Special

xt is the combination of the

for installation

fares; the State Commission has no
jurisdiction but the company has the right of appeal to the courts.
For many years prior to November, 1949, fares remained virtually

^

controlling,

scheduled

Rafferty was formerly manager
<>* thf statistical department for
the local office ot J. Arthur

policy

resulted in a
except for ance the needs of the country.
the tax "reduction
passed over a
It this program becomes excesPresidental veto which began to sively restrictive, it will prevent
exnand the money supply in early the money supply from expandin

Rafferty

—

similar unit is

a

since Jan.

the

Mass.

__

Columbus & Southern Ohio for

(Special to The Financial Chronicle)

BOSTON,

anLd ®rice the Boston Stock Exchange. Mr.

initiat6d

wag

making

new

F. L Putnam & Co.

extended program

restrictions

controls

Recessions, as well as
P
"
dons .have all followedperiods

Rafferfy With

government deficits failed to de-

therefore, examine the
many of these restrictive controls
role which money has played in
have since been relaxed, the Fedpast economic fluctuati
■
eral Reserve System has succeeded
Let

Patrick

1.20

sented an increase of 104% of the book cost of electric utility plant

'

Co>

1.20
>

Columbus spent $15.5 million in 1951 for electric

Commission

pommprflfi

and

.

generating capacity aggregated 320,800 kw at the 1951
An additional 60,000 kw unit was installed in April,

year-end.

of

ot
tne

Otheis members of the undei-

b

_________________

The certificates will be secured

writing group are: R. W Presspnch & Co.; L. F. Rothschild &
£°.; A. G. Becker & Co. Inc.;
Frecrn&n & 0°.; Ira Haupt & Co?;
HaydenJW.ller & Co£ The minors

ZcZ ls Twere

:

21

to finance World

hrrmtrht

23-19
22-18

Nov.

on

1950j the total money
SUpply was just about in balance
with the needs of the country at
then-existing price level.

^°<;k of

23-19

1.40

1.43

In

Knrpn

1.40

2.22

which had keen created by the
government
borrowing

War n

23-19

21

Co. Inc.

Stuart &

heavy

hom the banks

Range

$1.40

.1947

use

PVrp«

Div.

$1.84

1.40

in

la_tf_lv

Earned

$31

......

2.01

rise

sharo

tne

(Mill.)

1951

23

the volume of profrQm 1946 through 1950

and

goods.

deal

Year

<

——Common Stock Record

1948

Halsey,
associates

supply

homes andI other dur-

better cars

Rev.

2.57

largely absorbed the excess mon

needs
neeus.

is true

The company's record over the past 10 years is as follows:

2.30

the

ey

It

Electricity and transportation account for about 83% and 17%
normally provid¬
ing practically all operating income. The domestic load accounts
for 40% of electric revenues, the industrial load is
small, contrib¬
uting only 26%, while commercial is about average at 25%.
of gross revenues, respectively, with the former

26

in

d

a

28

increase

However

company's industrial business is very well

natural gas pipe line as the largest customer,
accounting for about 9% of industrial revenues.

1950

very

^oney

The

a

1949

the

prices

have

rural in character.

diversified, with

and

acjverse effect because of

durable

reduced
leu

severely
severely

capital goods ProducUonl Will
necessary
to balance equip-

and

and

wartime

(with a 1950 population of 375,901) is the capital
Ohio, the home of Ohio State University and a

of

trading center for the surrounding suburban and rural area.
City and nearby area contain generally diversified industry,
mostly small or moderate in size. The southern area is chiefly

2% a year. This sub- ciusive The certificates are priced
growth has had no serious t
: ld f
2 20% to 3 05%
de-

great

State

The

Equip. Tr. Glfs,

of only

normal

have

riod
noa

I9o0,

currency

the

offered

posits has had an average expan-

Eugene Hesz

and

plant

of

of

,,

through

1946

From

Approximately 76%

$6,375,000 Northern Pacific Railthe
way l952 2%% serial equipment
de- trust certificates, maturing an-

.

ever

Offers

Ohio Electric

Electric

retail

Halsey, Stuart Group

a

Ohio

estimated population of 230,000.

an

Columbus

area.

of

the

of our economic freedoms,

money

community.

business

the

is

durables

deficit
influence

Southern

of the company's electric revenues are derived from the Columbus

after

could

measures

with

area

de¬

decisive influence in preventing
a
depression severe enough to
cause further irreversible attrition

sur¬

supply, independent of the needs
and sentiment of the banking or

other

and

cash

Federal

The

or

direct

Such

&

supplies
electricity
through an interconnected system to an area in and around
Columbus, with an estimated population of 515,030, and a southern

will be required to keep investment active, the money supply
expanding and to maintain a high
level of economic activity.

special restrictions or in¬

centives.

capita
ownership of
cars,
houses,
refrigerators

per

Columbus

and

elimination

or

gains taxes
Canadian pattern,

capital

keep investment active.

in

liberalization

basic

preciation allowances,

Southern

tax

defense

in

drop

any

Columbus &

of

immediately

to

spending,

are

elimination of capital gains taxes to

Utility Securities
By OWEN ELY

*

.

reduction

prompt

collections

followed, including prompt easing of credit
as government cash surplus develops, along
with prompt re¬
duction of taxes to match decline in defense spending. Advises
fiscal

Public

prompt easing of credit as

veiops,

University of Detroit, College of Commerce & Finance
a

convic-

my

government cash surplus de-

a
.

Professor Hesz contends there need not be

is

balanced mone¬

tary and fiscal policies, including:

By EUGENE HESZ*

nomic

needs

human

it

tiorrthat properly

A

Thursday, November 27,1952.

unsatisfied.

remain

Is Prolonged Depression
Inevitable?

real

while

duction

.,.

crease

in

effective

about 40c

share.

a

& Southern Ohio is expected to benefit substan¬
tially by the construction of the large new atomic energy plant
near Portsmouth, Ohio.
Construction o£ the new plant is expected
Columbus

to

require

an

lished in the

tial

and

of 17,000 workers for five years, with a
Commercial enterprises are now being estab¬

average

peak of about 36,000.

and resulting in increased demands by residen¬
commercial customers.
Sales
of electric
energy by
area

Columbus are

increasing rapidly, and in the week ended Oct. 11
18% over last year compared with an average gain for the
industry of about 8%.
were

t

Volume 176 ^Number

5172 .The Commercial and Financial Chronicle '.,xZ
'■

(2031)
business.\ Who
'.V4
4

on

the2 Federal

;

-"Members, New York Stock Exchange

'

\

* ;

*

instances

are

or more

ate.

the

v

cost

of

dollar

to

money

of replacement
concept1 of
property
prefer
to
getting something better make their
change with respect
efficient, so that a straight to the. percent return.
Table II

comparison
In the main,

is

inapproprihowever, you

>
•

j

.-a.

—

x

_

t* /• *

•

_

j.

1

/»

the rate of return

on

sets forth the details for this calculation.

are

replacing similar property at .,, If this
so cheapened
inflationary • adjustment
that herculean ef- inflated
prices and retiring old were
applied to the entire capital
forts will be required to sustain
property on an original cost basis." structure of a
utility company to
it*at approximately the,
present By this process the annual charge
ift'iiral'*
txrltrtl-

•

Contending that State Public Utility Commissions are going to
extremes in refusing to
acknowledge the impact of inflation

certain
you

diminish when the dollar has been

>

?.

"

at

-

expects

'* 'A'"
York City

taxes

particularly,1 at

the local levels to diminish
much,
for some time in the future.
Who

'

•++; +
By CARL €. BROWN*
^Partner, Laurence M. Marks & Co., New

'•*

expects

and

•

19

a

•

.

i

compensate bondholders and

^

pre-

,

*

shows adverse effect

pared with industrial companies. Cites need of higher minimum + M 8row* year;by year in total assets, Either a
higher rate
rate of return on "original cost" and reveal*5 a" new
formula'
necessary or higher
new lormula ^ ^volume, of-business done, and

of return

is

8.1%.°While

needed

™

.;

r

,

..enlargement

V>';
i;

Much

time,

effort

and

money

to being expended

by the utility
with the important problem of inflation. Numer-

industry to

cope

S t

ous
r-

t e

a

•

•

Commissions

-

%

have had the

§.
%

value of the dollar to its
present
purchasing *1 power
of
53c,
we
would find that the real

dividends
utility
4-

ii

of

m-

and

stocks
u

,

value

industrial

the

of

It

quite

is

significant

brought before
ioi e

them
tn em

vigorously

by

125
iza

industrials
industrials

show
snow

parn'1
earn-

mgs and dividends 40-50%
than

to

Some

present 53c

Com
Com-

missions

have

in

raise

will

real

problem

but

weight

of

sions;

given

little,
effects

dav.e

if

to

inflation

others, have

refused

tory
rory

to

the

in

any,

adverse

their

deci¬

avoided

accept it

as

it

or

regula¬

a

responsibility, possibly beresponsiDiury,
possipiy
Deot its political repercussions,

cause

rpypj^gj

the attitude the

in—

dustry is faced with is this quota¬
tion

taken

wealth

from

of

the

Common¬

Massachusetts

Depart¬

ment of Public Utilities opinion in
the Western Massachusetts Elec-

trie

Company

1952:

-

"After

;

and

theory,

reluctant to turn to another

different theory

very

results in

which

variable rate base tied

a

to the current economic situation."
*

In

the

phone
New

recent

New

Company
York

(Oct.

the

unfavorable

con-

introduced

was

economists

investors.

other

•

1951)

on-

repercussions

equity

numerous

the

Service

of

the telephone business

on

its

and

3,

company s

inflation

Tele¬

before

Public

siderable evidence

by the

York

case

State

Commission

noteworthy

the
to

nnmrionmc!

prices

adjust

confronts

try

this

of

segment
difficult and

with

Tnoiv

observe

it

that

doubt

if

intended

the

that

Legislature
have

we

the

to protect investors in pub¬
utility securities from the ef¬

power

acquire

Some -of

may

be

we

see

investors

in

said

utilities
worse

have

No

accounts

the
uie

W1U1

conclusion
tuxiwusiuu

ntlatecl

levels

nave

nently imbedded in

been

FaHacy

going

to

very

which

wages

is

one

of

the

importa"nt"component/*of
of

the •
"

the

we

most

equipment

tvoe

of

formula

is worth
is w
x
intended to

-x«n> type oi iuniu

1952).

.

.

i

_

plus

cover

18% allow_

a

expected continuing

□

••

•

you
•

■

_

tion,

a
*

n_

and

.

it

your

^

then

is

jurisdic-

_•

..

_

i__

compensates

you

additionally for the impact of
economic forces, if they are ad-'
the

to

verse

maintenance

of the

risii^g"trVnd*in'co7ts7a"provision soundness"'"of"your""business, "so
i._

t

j

intended to obviate the early need

that

of

return

returning for additional relief,
AJ

f ,w

KJ-rzm

Ui

,

even

ivn

1U

U,,..,

you may

earn

a

fair rate of

continuously and not just
intermittently. From a practical

standpoint it would also
^

thg

application

of

appear

this

ad.
1ustment factor is politically palatablg since n keeps the over.all
,

ill.!..

1

Llle

materials used extensively in your

years ag0' In fact' your tlxed
capital costs have gone up constantly since 1940.

To be sure,

Adjusted 1951

1951

(53.3c Dollar)

$1.81

$2,44
1.88

17.35

over 1940

—28%
—35

—32,

.

1

_

"

...

1.498

in

11,426

•

for

my

wish to show

you

18,281.6

avoid

meeting

compare

the experience of

holder

of

utility

^"address

by Mr. Brown before the
Jersey Utilities Association, AbseNew Jersey, Nov. 21, 1952.

■

'




is

an

=

been

oi

the

liuuUviucuuii

=

(.35%

coats.

of

name

—

The

firm
Com-

been

,

Building,

Penobscot

Pany>

changed

to

F.

J.

has

Winckler

c0

Joins F. I. du Pont
(Special to The Financial Chronicle)

weighted

MIAMI
Davidson

*rje
Handy-Whitman

Mich.

Shader-Winckler
,

wholesale

a

BLS

J. Winckler Co.

^v*ng
index of

Fla. —Sidney

BEACH,
has

been

added

to

the

staff of Francis I. du Pont & Co.,
00„„

^

^

Collins Avenu

=
=

inflated

equity portion of the capital struc
ture only.
Since in case of thf
&

B

companies

=

6%,

an

.78%

12.95%),
of

inflation

becomes

return

i

ad¬

giving

an

of 6.78%.

rate of return, a

.78%

adjustment
over-all

As

an

of

(6%x

necessary

rap

alter¬

method for

pronerty
=

it

an

justment of 12.95%. Consequently
if the ordinary rate of return ir

-

.06 + .0078

weighted

electric

37%, he thereby arrives at

.37) 6%

M + A

$21,350,000,000 har
to
$28,929,250,000

35%.

native
x

.

He then proceeds to ap¬
ply this adjustment factor to thr

PEM

equally

Peace or in

.

could

increasing ttr
utility company'r

be

adiusted

fror-

originial cost into cost expressed

6.78%

average of the BLS
Wholesale Prices, the BLS Cost of
Living and the Handy-Whitman
inuex

adjustment, which is

tric utilities of

ir
index

'lmes> 1

a

DETROIT,

from

years,

2,350

$100

A

napon a'

that the historical net investment
of the Class A and Class B elec¬

28,929.25

R
price

by

100 "

Cost

.

y

an? p^y?.,ca"y abla,t0r,fmfnl
th!. ^ "tdlty d?ma"?°fJ'?*

(estimated)
inclusive,
by applying an annual index
of

,i,r

of

1,672.13
1,944

Adjusted Rate of Return (R)

*The

investments

in-

increment

1.854.72

•'

Adjustment (A)
+

annual

1,587.84

Change in Price + 35% "

se¬

Mor-

108.62

•

Historical Cost in Current Dollars
135
Change in Price (P)__^
+35%
Common Stbck
Equity + E)—37%
Basic Rate of Return
(M)
6%
Price

Money in

Ml 1.73

•

A

head-on

of

Professor

1,001.35

Hypothetical Example

real and pressing problem.

May,

utility construction costs, equates

21,350

Historical

the

sets forth for the electric

average

or

are

the Value

Utilities."

the

n„n.

fm nc

the aggregate investments to 1952
dollars. In this way he determine-

.

purpose

in

100

'

1,944 E.

to what

and

and the

be said to refute these

but

Economies"

282.61

2,350 E.

%

method advocated

,

strength,

Morton,

110.19

1952

.

to

120.21.

1951

.

of

Millions)

142.73

at¬

holders

turn

and

160

adjust¬

we

"Land

1952 Dollars

1,660

come

.

P°lltlcal

1945-1952

Utilities

Adjustment

1949

the

in

in his excellent paper reported in

dustry

Net Investment

1950

there has

a

A.

corrected

....

Professor, war*
Department of Economics, Uni¬
Now F.
versity of Wisconsin, as set forth

net

Investments in

bonds,

if

attention

Walter

ton

*Index of

corporate

be

can

by

+ 19

1.441

an

a°und

37.69

Electric

on

is the key to our national
international economic and

business

Public

Class B

inflation

of

your

and

+42

1952 Dollars

effect

which

o

2.37

70.72

why I be¬

message

my

the

„

a

$3.93

•+52%

^^ally
This is
lieve

m,iHo
possible guide ^ w the
to how
inflationary impact on the utility

Ac
As

4.44

Annua! Increment of

1948

life

of

Corrected

.

$7.37

Investments in Class A and

you

1952 issue captioned "Rate of Re-

31.76

.

you

plant

your

n,ands for utlllty servlice

.

1.67

in

protect

absorb the unfavorable impact of
"historical cost" depreciation accounting required by Commissions

business necessitates you
de- getting a higher return. Fair-*
minded people in all walks of life
will agree that this is a small
how inflationary Impact Can Be price to
pay to keep an enterprise,

$2.59

share

per

con-

o

my

1.00

32.55

198

in

in

Adj. Change
1951

$1.30

1.54
25.64

Moody's 125 Industrials:

Price

changed economic

rate of return,
Actual

Earnings per share
Dividends per share

a windfall
fair return in terms

,

(ioocDollar)

share

a

from deterioration of

-

hv

;

Actual 1940

per

expect

ditions, which will
-

TABLE I

Moody's Utilities:

not expect or urge

—you

ge

•

c?st.^ a ^reat deal more today lor
Slmilar property you installed ten

and

curities, by adjusting the nominal

con,

to

ance

of current

.

equity

rate

ated rate base

Rate

of ,your plant; f0" fin,d ,that. u

expense

utility service and
heavily in the cost of
mining and
manufacturing
0f

Cost"

or

833

curities with that of industrial se¬

New

been

'

^
y
and your capital and enable
?dh,erence dollar" _';origm_al cost;te^ the rate base. You
"fixed
^ ^onstantlv"replad^
«"<?,Lon&uumy xepidtirig poinons capital to meet the growing

enters

process

«0riginal

f.

y

rendering

also

o(

j wQu]d

Who expects the clock
to be turned back on the scale of

Experience of Utility Securities
If

6%

..

economic'

our

1947

extremes certain Commissions

a

to

Base

structure.

not be treated equally or
justly
the purchaser of yes¬
terday might reap a windfall."

I merely

capital

basic established rate

15,

company requested* a
of return on a
depreci-

.

Perma-

1946

or

various

can

eauitv

give

(Oct.

n

the

utility
sitv 0f obtaining a'higher rate of
stocks offer a temporary haven
,y
_,h,
» a ig er rate ot
for protection against such con"ls
:an °°
a
tingency. Whatever the cause may "ear conscience since Dywi pres
Vl/3
1+ l-lpVinriXrOC Kn + l-l monodomonf
LoiAUclI US UlUIiy
ale
be, it behooves both management

costs of doing business at present

*would

Much

the

to

appnea to me equity capital•

This

of return, used in

Commission

There

downward and the electric

many

being

government

generally

contentions

atmlied

ities
r*-»v

generated from the fear that business
generally may be headed

argue

that
umt

1945

are

tempted to make such

.

be

only.

since

do

informed person will

with

why

invested

in

.

'

prob-

.

about

reason

or

in

the

has

is

adjustment due to inflation should

considering

,

better than

no

insurance,

ment

demand

-An

.

justice of protecting

investors,

bonds

the

rates

inJ •m me recent Facitic

o

the basis of 50%

on

-Preferred

Electric Company rate case
before the California Public Util-

of what old stockholders paid for
t.hpir interest in thpsp pnmnanips •'
their int.prpst in these companies.

(Money Amounts

savings

them

able

are

additional

lem is found in the recent Parifie

omn

they

request

adjustment* in

^+."51 this
J?.
interesting approach to

are willing to place
+ ioc
in the equities n-P
of

when

ineir capital, ana nave a ciaim on
assets only after the bondholders
and

ana preieirea stockholders aresxocKuoiaers are
tully provided for. Therefore, it

.

sion stated:

who

nDward

investors stem-

in

to

"ecessary

new

TABLE II

While, obviously, fully appre¬
ciating the problem the Commis¬

those

mAnoxr

•

on the dividend rate, risk
their canital and have a claim on

.

fects of the policies of the national

any

y—

r
to

thn

chances

rendered at too low a price.
Ex- return within reasonable bounds,
and regulators to be alert to their
cept for its traditional usage, there ^
compensate you for
responsibilities of maintaining a
is nothing legal or sacred about the further
facilities and equipment to render favorable attitude towards
pmch of operating
capiutility services, the industry un- tal, if consumers are to continue a 6% rate of return. If it takes costs, offset higher capital posts*.
der the
lag
der the adverse impact of infla- to enjoy - the benefits pf ample,; d%%i or even 7%, to offset the diminish the effect of the
enjoy-the
ample,
ret)ercUSSions
on your
tion, ™'frh+
allow you to
Hnn might be in a sorry state +a- high grade ntilitv sprviao at rea- fePriCU!>s,luxl6, of inflation on vour in earnings, andi..«
eniTC
gradp utility service at rpa- repercussions of 1I!il<tuu" 011 y°ul in earnings, and allow you to set
tot^z.
business you should have it. You aside into surplus a cushion to
day.
sonable cost.

government."

treated

-

utilities

genuity of constantly developing
more economical
rnrt|,° onnnnminol mnnni- of doing
Jninrt
means
business, including fuel clauses,
and obtaining more efficient
plant

is

the

this way:

over-all

sary since these classes of security holders, in effect, have con-

reasonable to conclude
the
Deiore> utility companies tound it is reasonable xo conciuae that xne
uiat

histnrv

pension funds, personal
insurance
comnanies
and

their'-money

_

Dividends per share
Price per" share

the

iti

institutional investors stem

these investors

indus-

Among

contentions

to

"Whatever

in

measure

hv

was obtained, or even
utilitv rnmnaniPi fmmH it

before

from

trusts

inflexible

Earnings

lic

fi

that

duration tnat by the

time relief

today—

Fusls,' lnsu^ancf companies ana Gas &

rules and practices over its
operations.
Were it not for your in-

Commission discussed the plea for

"We

hpst

small

5

-

investment trusts; Small wonder

Tl

of their goods at
their operation to

protecting the integrity of capital

ever

rs

free to

are

indus

in

inknow, the lag has

as you
been 0f such duration

the elec-

standing

large institutional
ming

+a

orn

companies

tho

,

the

Table

thp

good

in

?-y
due in no

inflationary conditions. While
ut.ilit.ifs are farpd with thpsp camo
utilities arp faced with these same
conditions, our American tradition
0f
regulating utility companies

of loyalty

many years

to the prudent investment
we are

adiusted

this could be

appear neces-

«

V

;
so

dated June 23

case

all

doflar^fSee

lnr MiCTrihl

it to be

a

1940

of

re-

Tn cnml
ootaining it. in some

\

in

segment ot'the utility indus-

nrobahlv

presenile dollar. (See Table I).,
Industrial

acknowledged

practical

spompnt

is

asking for regulatory

lief and obtaining it

5; tneir money in stances,

•

ntilitv

higher

annellants

to con-

mnnpv

sure

utilities used m
Moodv's utilities average arp
mooays uxniues averageare <ju
+
less than in 1940. On the other
hand
nana,

th^ir

trie

24

of

invpst

your business .To be

to

opserve inax average earnings and I
average earnings ana. try
dividends

conseauences
consequences

...

tinue; to-

observe that

serious

Carl C. Brown

become aroused and refuse

A s.l0(+s, consmeraoiy

U

higher.

done, it would not

^
their «*ed in¬
of the come and the former are paid off
costs has by a prescribed date or sooner.to produce a lag between the Common stockholders take their
of

M
time

to

were

^suit ot tms,jnvestors were to
.

considerahlv+?u

stocks

preciation accruals should be al-

when lowed to offset this adverse infla-

consumers,

rlsSt^"Si^investors

of

siiDstan

xv

annuals de-

areTctuaUvdiShine' •" ^n?ther lmportant
^ould be unfortunate if'as 1 'nflat'onary trend of

it

suhstan^

are
r

tially below 1940 but that

flation ana us
nation and its

.
.

market
todav

-,,y

betterment

"S^flnd vo^re^ +nary impact -'+

earnings7

n<Y.e " a " .ne t"

■B': subject

of £ service-.. to

and

in dollars of the current year and
the rate kept intact. However, i4

would appear that regulatory au..e
historical cost

Servihg In
iiiiiiiiiiiiiiiiiiiiiiimmiiiii

% UTAH

COMPANY IN

IDAHO

iiimiiHiiiiiHitimiMiiiiiiii

WYOMING

A

HEADQUARTERS
SALT JAKE

CIT.Y '

GROWING

imifiimmi

COLORADO

WEST
'

20

The Commercial and Financial Chronicle...

(2032)

all be hurt. philosophy. I think what we can't
unjustifiable endure, we must cure, and I think
and reduce profits. We will the day is here when we are going

eventually
will

We

Automobile Credit Problems

losses

ourselves from a public
relations standpoint with the cus¬
tomer. Dealers will greatly reduce

Vice-President, Associates Investment Company
South Bend, Ind.

their

Foreseeing change from current favorable automobile financing

maturities

Says

check-ups of

more

of sound credit judgment
and
higher financing charges. Says whole¬

likelihood of need for

sale outstandings are on increase

and

more

the market on used cars if we en¬

period has been
very profitable to all; many have
made
profits in spite of what
they did or how they did it.
We
have
been
in a
period of
postwar

should have

the

with

line

financial statement
credit
statement.
I
a

that because many customers
appear
to be able to pay who
cannot do so as they are already
say

used

too

taken

not

depreciation;

normal

even

have

values

car

merchan¬

the

on

try

Per¬
can de¬

reaction.

bad

sonally, I don't think we
standard

from

viate

would

This

cars?

used
very

a

the

hold

to

any
can.

months?

perity.

pricing his

to

the

of

In' view
exist

all

today,

finance

efficient
fication
fraud.

that

compa¬

in operation an

should have

nies

hazards

of account veri¬
protection against

system
as

distinct

Two

methods

of

portion

major

of

verification

a

program

must be handled by the

negative

method because of the
involved. By that I mean

expense

be

extended,

we

are

then

but

again,

if ing this system of negative verifi¬

going to 30 and 36 months
cars,
what is going to

new

on

Supplement¬

purchaser's records.
cation

the

verification

be

must

by

positive method; that is, either

by personally contacting the pur¬

chaser or by directing an inquiry
In the purchase of retail paper
ployment has been at an all-time
by mail which does require a
high. All of this has been very terms are of most importance.
Repossession Rate
first
consider
reply. Whenever circumstances
down-pay¬
favorable
to paying habits;
we Let's
It is doubtful that anyone in
are
such as to create suspicion
In
this
business
down
couldn't do much wrong in buy¬ ments.
this business purchases short
that
misrepresentation or ficti¬
ing retail paper and approving through the years it has never
down-payment
transactions and tious retail exists, positive verifi¬
credit.
In this
postwar period b&en a sound policy to deviate
extends long maturities because he
cation should be made promptly.
many
things, most of them fa¬ too far from the standard onefeels it is sound business. He does
There can be justi¬
vorable and very few unfavorable third down.
Because of the importance of a
it only because he is fearful of
to our type business, have hap¬ fiable exceptions.
However, ex¬
definite verification
program
in
competition. None of you will
pened. No one had to do much ceptions cannot become the rule;
the operation of our business, this
disagree with the thought that an
we
will
definitely
selling
to
acquire business
to otherwise,
subject will be discussed in detail
is necessary.
We
take care of volume requirements, weaken the over-all grade of our improvement
at our forum later today.
Most of us
have gone cannot continue to live with the
and not too much know-how was paper.
Wholesale Financing
required at the working level through periods of unemployment present high rate of repossession
of the business to have the busi¬ when the value of the merchan¬ frequency. Firm action is neces¬
Wholesale outstandings are on
dise we
sary. Although we must make a
were
ness liquidate satisfactorily
financing depre¬
after
the increase. How high they will
We went profit today, we must give greater
purchase. We can all be thankful ciated very rapidly.
go will depend entirely upon us
for that.
these
periods without thought to the pattern which is
However, I believe we through
as individual operators. Why does
the
must all admit there has been a suffering too great a loss because being cut for tomorrow. If
we
had maintained sound terms basic principles are disregarded outstanding floor plan get out of
change.
bounds? Because the finance com¬
and good down-payments.
Even today, what kind of a business
Many in business today have
in normal times there is no sub¬ can we expect for tomorrow? In panies, the dealers, and the manu^.

been

lulled

^

into

complacency.

facturers have not come to

credit judgment, we must be se¬
lective,
accepting the qualified

rejecting the

less desirable.
purchase
business
without a thorough investigation
and proper analysis of the risk
involved after the investigation.
and

cannot

We

The measurement of
is

a

credit risk

intangible thing; the degree
of risk very seldom remains static
during the life of the contract.
an

Retail

transactions

be

must

thoroughly checked to determine
the willingness and the ability of
customers

contracts
are

I

to

perform

and obligations that we

asked to approve.

am

the

under

Personally,

great believer in follow¬

a

set formula in grading and
credit applications.
I
such a requirement is not
necessary
for
an
experienced

ing

a

approving
know

credit

employee, but in our op¬
erations today how many expe¬
rienced
credit
people
do
we
Those who have been

have?

proving credits during this
postwar

perous

be

period

cannot

considered experienced

people because
business

of the

credit
poor

they approved paid out

the

under

some

ap¬

pros¬

favorable

conditions

been
living in.
They
yet acquired their credit
judgment.
we

have

one

venture to

here

will

be

say

that every¬

devoting

more

cash

is borrowed

ment

it

is

borrowed

lending
happens?
having

are

thoroughly

checked.
ment

In

screened

and

passing credit judg¬

today,

two

or

So

what

installment

to

he

pay

actually

sometimes three.

and

It

might be

very surprising to many
if you checked, to find
what percentage of small loans
are
being made today to make

of

you,

down-payments
We

purchases.

doWn7payments until

actually

''squeeze"
In

used

the

comes.

credit judgment
of credit appli¬
sound knowledge
of

approval
a

is

values

car

indispensable,

knowledge of not only current

values

but

worth

of

months'

also

of

the

used

that

time.

probable
in

car

should

We

six

train

credit people to know values
and caution them against substi¬

all

This
of

brings

yield. As

tuting

published
actual

used

guide

car

values.

large,

down-payments,

create

by

over-advances

and
and

the combination of the short down-

payment and the over-advance in¬

be

collection

Today

exercised

used

long

vidual.

older

in

expenses

more

firmer

and

maintaining

requirements
payments,

relating

control

more

to

rigid

down-

over-advances,

maturities.

and

caution must

Naturally,

and
the

in

this postwar

period that have not gone up

in

Coca Cola and finance
charges. There are many in this
industry that are accepting the

price

—

rate

on

preciate /that
has

We

must

all

for

we

on

production

a

schedule, which is based
anticipated requirements
dealer.

must

We

consideration

also

on

of

the
the
into

take

seasonal

require¬

ments, expected lay-offs, and the
These all

like.

due

have

a

place and

consideration

for

What is

in

the

being done in

care

of

cost

the

of

even

we

have had

the

Most industries

consumer

their

of

their

to
proportion
pass on

good

a

increase

in

the

or

commodity

cost

the

of

service

they render. Our business should
be no exception. There are many
by which

ways

plish

this

selves
but

we

solicit

of

any

are

not

dealers
much

"How

we

without

out

company

could accom¬

pricing our¬
good volume,

going

on

is

be

to

if

we

basis

of

present

fi¬

the

your

paying

you

in the

more

controls

All

increased

that

money

indus¬

our

of yield to

way

during the yast year? All expenses
up.

of

of

dealers

industry today requires
much aggressiveness and

well-directed

sales

ability

as

it

did years ago, but the truth must
be admitted—it is net getting

kind

of

treatment.

How

being ushered in. To live and

should

kpow

-




how

the

* car

the

more

more

hazard

men,

condition

undesirable class. Those

an

definitely warning signals in
proper
handling and con¬
trolling of dealer floor plan.
are

How

better correct many

can we

of these

things

have been talk¬

we

ing about? Let's be

sincere

more

with each other in this great busi¬

there is plenty of

ness;

all.

The

ference

American

for

room

Finance

Con¬

organized to promote

was

closer cooperation among

members.

We

should

all

its

able

be

benefit by this common mem¬

to

bership. We recognize

opportunity

to

that

are

have the

we

with

work

other, but there

opportunity
we should. We

fectively

as

hesitant

about

each

too few of

that

use

ef¬

are

too

exchanging

formation that would be

us

as

in¬

help¬

so

ful to all of us, but I am sure we

individually
dollars

for

can save

thousands of

companies

our

if

we

will take

advantage of and further
develop this inter-relationship to
improve

operations

our

and

further promote this industry.

Coleman, Hoehn VPs.
Of

Gregory & Son

Gregory

&

Son, Inc., 40 Wall
Street, New York City, announce
that

Francis

Herbert

firm.

firm's

ager

Mr.

been

have

Coleman

department;

and

Coleman

Hoehn

Vice-Presidents
Mr.

the

of

X.

A.

elected

of

is

Municipal
Hoehn is

of the Railroad

the

\

Manager

Bond
Man¬

Utility

and

trading department.

Texas IBA

Group lo
Spring Meeting

Hold
SAN

Texas

ANTONIO, Texas —The
Group of the Investment

Bankers
will

Association

hold

meeting

their

America

of

annual

spring

•

the Plaza Hotel, San
on May 7 and 8, 1953.

at

Antonio,

John D. Williamson, Dittmar &

Company,
man

of

newly

the

elected Chair¬
Group, is in

Texas

charge of arrangements.

Dallas Trust

Company
Is Organized

is there left to give,

Bank

Building.
Officers are: R.
Underwood, Chairman of the

A.

Edytha

in for

We

are

a

very

profits

cline. Floor plan
risk with very

it

turn;

exposure

risks

er

We
a

in

a

are on

involves

a

re¬

of

the

sizable

must be closer to
the dealer's operations than that.

his

DURHAM,
Chandler

in

used

a

N.

has

C.

—

Ralph L.

become

affiliated

with R. S. Hays &

Company, Inc.,

Corcoran Street.

Ill

Joins

abreast

we

most

Hays Co.

(Special to The Financial Chronicle)

important

thing

to

Perry Blaine

(Special to The Financial Chronicle)

dealer's current condition by

The

and

Secretary.

extended. Deal¬

hope to keep

statements;

Turner,

With R. S.

great

receiving periodical financial

used

Vice-President;

constantly changing.

are

cannot

Executive

period

little profit in

are

A.
Underwood, Jr.,
James
R.
Stanley,

the de¬

represents the greatest
we have in this busi¬

because

ness

R.

President;

rude awakening.

definitely

when dealer

The Dallas

Company has been organ¬
ized with offices in the Mercantile

aging. If they fail to do this, they
are

—

Trust

Board;

ASHTABULA, Ohio
Madsen
with

has

become

—

Carl G.

associated

Perry T. Blaine & Co., 221

Center Street.

dealer's

car

operation is
inventory and his

operation. In a period
gentle¬
in the way of liberality in when there is a shortage of cars
paying at the present there is in- deviating from stand¬
and prices are rising, not much
terms, maturities, advances, and
time out of his
monthly income ard and sound requirements. How reserve?
Expenses have increased. ability is required to succeed in
on
obligations
and
proud can; we be, as leaders of
livirig
ex¬
Dealers
Losses are on the upward trend. the automobile business.
penses.
I£ it were practical, we this' great industry, if we foster We have
probably gone the full that permit their used car inven¬
or permit unsound terms for our
tories to increase and get out of
cycle pf inflation. Some people
*An address by Mr.
Dye before the * customers artd dealers alike. No
bounds
are
headed
for
trouble
American
Finance
say what we can't cure, we must
Conference, Chicago.
III., Nov. 6, 1952.
8 ' one will gain in the long run; endure. I don't believe in that eventually. Used car inventories
We

much he is

merchan¬

or

the

under such a competitive
condition, all dealers must do
more
planning and better man¬

prosper

that watch

much

business

retailing automobiles is due for
drastic changes. A new era

is

pening far too frequently.

as

his

salable

in

DALLAS, Texas

the

agree

some

of

of

This

is of

or

exercised.

amounts that

just

four

there is
his mer¬

so,

too high for the

cars

not

factor unless firmer

a

are

reserve?",
leaving the
dealer with the impression we are
willing to pay more. That is hap¬
way

does

market

is

dise

control, and this will continue to

rendered.

try today in the
take

he

or

too

service

the

current

ap¬

manufacturer

the

work

to

are

all

are

control?

under

postwar cars.
quick to give handling of any dealer's floor
instead of exercising the required plan. It is mostly through neglect
salesmanship to convince dealers that we see dealers' inventories
out of balance and out of
to obtain for us justifiable rates get

same

Again

nance

Short

think of only

commodities

our

values for

can

adequate rates. I
two

the subject

up

industry we have
well in maintaining

an

not done too

are

exercising

the

cations,
a

car

get the bad effects
down-payments or bor¬

rowed

in

on

won't

low

of

in my opinion, we
know 'more
about
the
spendable
income of the
indi¬

should

one

automobile,

has two

losses.

applications

from

sometimes

Instead of the customer

one

the

on

and

institutions.

creases

our

customer

are
bor¬
down-payments.
Some¬
the entire cash down-pay¬

times

time next year to credit matters.
that

fide

bona

down-payments

rowed

We will

see

a

in
that
today because a very
high percentage of the so-called

haven't

I'll

for

If

a com¬

plain words, gentlemen, we are
Doesn't our good business judg¬
Let's not
in a good business but we are too mon understanding.
ment tell us that there is going equity in maintaining satisfactory
blame the dealer or the manufac¬
to be a day of reckoning?
That liquidation. Today we are in a quick to "throw in the towel" turer if we haven't discussed these
when it comes to standing for
day may not be too far away; period when loose and unsound
together. If we don't
terms are entering this business firm business policies. If we don't problems
paying habits are changing and
and
they will pyramid if not make the correction now, we are currently advise with dealers
repossession
frequency
is
in¬
about their inventory and their
controlled.
Too many in passing
all going to be asking for crying
creasing.
Therefore, it is nec¬
inventory requirements and also
on credit today are misled when
towels later on.
essary • today for everyone to be
with the manufacturers, how can
mere
selective in the extension they see a cash down-payment.
The Financing Charge
we
expect
to
keep
wholesale
of
credit.
To
exercise
sound There is much misrepresentation
stitute

inven¬

period of three

a

something wrong with
chandising methods. He is either

verification may be employed. The

down-pay¬

longer time can

merchandise the

to remain in his

cars

practices that we have permitted
creep into this business during
this
period
of
abnormal pros¬

a

extent

great

any

Why
used

tory for

to cure

by directing an inquiry to retail
with purchasers which requires a reply
age car. From maturities we only
if
the
information
being
Naturally, the newer the verified does not agree with the
to

ments

happen? We will be required to
extend a longer time on used cars.

Retail Paper

Purchasing

em¬

then

and

have

over-extend maturi¬

cars,

new

ties,

heavily obligated. Today too
dise in which we deal.
All dur¬ many applicants with a Cadillac
ing this period the prices of new appetite are endeavoring to pur¬
cars
have continued to increase; chase cars on a Crosley income.
for

demand

great

down-payments

deavor to shorten
on

attention should be

given to dealer's finances and used car inventories.
The

will happen to

down the line. What

use

Calls attention to rise in repossession rate

be
currently turned over.
should any' dealer permit

must

lot of the bad

have

to

without

cars

affecting the market on used cars
unless we follow the trend right

time should be given to credit

purchasers and

car

will be needed.

over-extend

and

new

on

shorten

cannot

We

sales.

down-payments

conditions, Mr. Dye cautions finance companies against lulling
complacency.

up

injure

By T. C. DYE*

into

will

we

build

Thursday, November 27,1952

Saunders, Stiver Adds

car

-

(Special to The Financial Chronicle)

CLEVELAND, Ohio—Donald G.
Rundle
staff

has

of

Terminal
bers

of

change.

been

Saunders,
Tower

the

added

to

the

Stiver

&

Co.,

Building, mem¬

Midwest

Stock

Ex-*

Volume 176

Number 5172

...

The Commercial and Financial Chronicle

(2033)

constructive

Consumer Credit Aids

credit because it

en¬

physical

as

ables, ana encourages, consumers
to buy durable goods which raise
their standard of

Business

little

Consumer

living.

Stability

Today,

American

our

'30s

tion and distribution of consumer

trends

should

fact,

use

credit

consumer

credit has contributed to higher standards of
living. Says
present consumer credit agencies provide adequate
financing
sumer

veloped into

vast

a

business, with
yearly volume of
more
than $50
billion. It is
a
business
estimated

which

deter-

mines

the

sales

in

lines

and

which
this

some

has

and

low

income

was even more

recently,

less

fact,

than 20 years ago,
that the commercial banks entered
on

a

credit in

growth of

con¬

these years indi¬

cates the fundamental need for it.

The fact that those
credit

"grass
roots"
origin because

have

numbers

demands

has

not

devel-

quieted all of its critics, although
they are much less aggressive

oped

in

re¬

than

sponse

to

in-

As

it

has

sistent
mands

de¬

ments

Raymond

seg¬

of

Rodgers

the

public. It is

were

as

few years ago.

a

.

.

.

business which dra¬

a

ment selling is that it is
causing
manufacturers, advertisers, mer¬
chants, and consumers to go more
to social needs, and that madly after material
things to the

matically illustrates the important
principle that institutions arise in
response

when
to

established

meet

the

institutions fail

changing needs of
institutions develop

society,

new
flourish like

and

the

"green bay

tree"!

It is a business which has
been credited with the virtues of

neglect of the things of the spirit.
One becomes addicted to instal¬
ment

buying as he would become
liquor or gambling or
other vice. The entire prac¬

portance,

especially

portance,

to

the

a

such

im¬
im¬

functioning

.

.

Nowadays nearly evervone
just the opposite of this
But,

today,

who

better idea of "the shape of
things

are

to come."

there

sumer

Form

Consumer

,

of

credit

personal

and

de¬

frigidity in

surroundings of marble and ma¬
hogany. As Hugh J. Bernard put
it before the Financial Public Re¬
lations Association, the bankers

features, the brass
voice, and the glass

out

of

out

the

of

the

than

older

emergencies

of

death, sickness and disaster. Cred¬

as

it guarantees that the
public will
be served ever more
and

effectively
always at lowest possible cost.

Consumer Credit

Expands on the
Upward Swing of the Business

Cycle
Consumer credit totals in recent

months,

especially since the re¬
of controls, have been at

moval

record levels for all agencies. This
is to
be expected, as consumer
credit

expands

with

the

upward

swing of the business cycle. High¬
er
wages,
higher employment,
higher prices, and the expecta¬
tions

these

on

total

even

feel

of

factors,

all

affect

income expectation have

fundamental

a

credit.

consumer

influence

credit

sumer

has

totals

been

in

partly

had

on

the

In

con¬

past.

because

of

the

changed psychology of cus¬
tomers, but more largely because
of the changed attitude of credit
grantors.

still others who feel that

credit

Consumer Credit Contracts

on

the

Downward Swing of the Cycle

con¬

Consumer

the

accentuates

credit

naturally con¬
swing of

tracts

Contribution of
to

Consumer

Credit

Higher Standard of Living

a

The

great contribution of
credit to

sumer

con¬

higner standard

a

of

on

the downward

partly

due to

the change in payrolls and

prices, but more largely due to a
change of psychology on the part

money;
and the
pawnbroker and moneylender are

mentioned in

unparalleled contribution to Amer¬

As

ican strength and prosperity with¬
out the aid of consumer credit.

evitable in the months

Even

that they can help offset it rather
than accentuate it. In

antedated

ance

writings.
Despite

this

outcast until

in

many

chief

of the earliest

great

credit

consumer

years

some

largely

an

comparatively recent

America.

(There

were

for

reasons
ones

antiquity,

was

this, but the
the contention of

were

the

15

confidence

"With

was

the

no

exception of
the - banking

automobile

that

Street regarded

sold

the
on

It
40

first

also

was

years

Sage

automobiles

ago

in
—

our

time—only

that the Russell

proposed

the

shark

evil be combated by
licensed and regulated
lending agencies to meet the in¬

setting

up

sistent demand for small loans, so
that such credit could be secured
an a

competitive and fair basis by

those

who

needed

it.

This

revo¬

lutionary
form

Law,

as

proposal,
which
took
the Uniform Small Loan

has

China.

The

in

wise

since

been

adopted

in

vehicles,

form

public

of

transport."

it

tude,
of

until

to

Wall

as

a

new

commercial

of

this

atti¬

that

it

1911

that the stock

automobile

an

was

not

and

the

sports and

is not surprising

not

was

of

men

In view

in

manufacturer

first listed

finance

dealers

and

purchasers.

institutions

ing out the peaks and valleys of
success

and

ing credit

on

part,

by

emergency
a

by offer¬

dignified Basis for

sumer

Finance Association,

Y, Nov. 20,

Rochester, N.

1952.




now

so

particular,
policy should

credit

grantors, who
and
lacked

experience,
war

of

contingency, got

jitters in 1942
liquidation of their

forced

outstandings

at

considerable

themselves.

forget that
credit,

normal.

tire

They

loss

seemed

to

debt, the other name
is normal — not ab¬

For

the

economy,

reduction

tivity,

we

the obvious solu¬

was

These

consumer

tions enabled

possible
durable

and
of

us

otherwise

all

more

would

increased
consumer

which

raised
our

credit

institu¬

to secure sooner

have

been

production

sake

any

in

of

such

volume

the

en¬

panicky
must

be

find that sales finance

highs by 22.2%
companies, 50.7%

In physical terms, sales of con¬
soft goods and some con¬

sumer

created

new

jobs

people*. Such
properly should be

past. The Em¬

well

durable goods held up very

through

credit

So,

called

little

in

1931, and

1932

repayment
to

the

as

past

con¬

credit

consumer

has

than the surface

more

scratched.

Although
the

of

one

it

im¬

most

(2)

better, to consume the greatly in¬
creased output which our econ¬
break

down.
The future, there¬
fore, largely depends on the ex¬
tent to which you men in con¬

cushion the impact of
unemploy¬

This, too, should make it

and

Pension funds of

kino

one

another, including Social Se¬
curity, will further contribute to

credit will

to

Consumer

should

continue

next

year,

downturn

credit
at

despite
in

the

the

middle

there

will

in

ditioning,

home

be

Arthur A. Green Joins'

activity
the

best

year,

great

Shearson, Hammill Co.

op¬
con¬

modernization,
television, espe¬

opened up by the

areas

stations.

of

our

against

level

expectea

financing air

home freezers and

new

volume

high

business

portunities

cially in

a

consumer

be

to

prove

unemployment
instability when cap¬
ital expenditures by industry and
defense expenditures by govern¬
ment
decline.
So, continue and
expand your good work!
weapon

spend.

(4)

more

and business

relatives and public char¬

year

have in the past,

ways

ity, as they generally were in the
past, they will have $10 billion
a

and

more

of the good things of life. If you
this challenge, as you al¬

rise to

stability in the future. For ex¬
ample, by 1960, 9.2% of the Amer¬
ican
population will be 65, or
over, but instead of being depend¬
on

people for

more

and

ent

credit can develop methods
policies to finance more and

sumer

easier to maintain credit volume.

(3)

must produce if it is not to

omy

Unemployment
insurance
are
very large and will

ment.

credit.

known,

our problems
in America is to get people to live

government to do everything pos¬
sible to prevent extreme
swings
in business activity.
>

consumer

As is well

the

'

(5) Most important of all, more
knowledge of the tech¬
niques and methods of maximum

consumer
credit
extension
will
enable credit grantors to maintain

safely a volume that would have
dangerous a few years ago.

been

These

favorable

factors

should

give credit grantors such confi¬
dence in the future that they will
not

adopt credit and liquidation
policies which might so reduce
be

Arthur A. Green

intensified.
(Special to The Financial Chronicle)

Consumer Credit is

a

Form of

CHICAGO,

Consumer

credit

was

of

the

intensify the

even

not

the

drastic.

credit

did

depression,

111.

contributes

Shearson,

to

South

the political

stability of our com¬
petitive system of private enter¬

Hammill

La Salle

&

Street.

was

formerly

with

rity

Company

and

couraging,

was

manager

quire

partment

prise

by

enabling^fact,

en¬

wage-ea^mers
to ac¬
worthwhile, stake in it.

a

as

mortgage debt and home-

ownership have always been
couraged

for

Co., Inc. for

of

Union

Secu¬

trading

Anderson,
many

Green

thereto

prior

the

208

Co.,
Mr.

de¬

Plotz

&

years.

en¬

contributing to social
responsibility and stability, the
acquisition
of
automobiles,
re¬
frigerators and other consumer
durable

A.

Arthur

—

Green has become associated with

Saving

as

With

George Elkins Co.

(Special to The Financial Chronicle)

BEVERLY

goods should likewise be

HILLS, Calif.—Harry

R. Portman has become connected

encouraged as a stabilizing social
force.
In
addition, the
disci¬

with

George Elkins Co., Beverly

Drive at Santa Monica Boulevard.

plinary, character-building influ¬ Mr. Portman was previously with
ence of the development of
per¬ Walston, Hoffman & Goodwin and
sonal credit, and the regularity Morgan & Co.
'
of

instalment

payments has

been

built

into, and strengthens, the
everyday fabrics of American life.
As Professor Phelps of the Uni¬

Davies Co. Adds
(Special to The Financial Chronicle)

SAN FRANCISCO, Calif.—Nell
generally, A. Somes has been added to the
the feeling today is that instal¬ staff of Davies & Co., 425 Mont¬
ment sales financing is not a mat¬ gomery
Street, members of the.

versity

of

Southern

puts it, "More and

California

-

more

of

New

York

Stock

going

into debt, but a
of organized saving, en¬
for the regional, and 37.4% for the abling the common man to
acquire
local companies.
capital."
In. fact, it is not too

the standard of living .decline

of

portant areas in the entire credit
structure, it will go. on to new
heights. In fact, it must go on as

reasons:

process

sumer

of

just

ter

goods at lower

Contribution

Remarkable

can

ployment Act of 1946 commit

exceeded the 1929

of

Future

the entire economy is at stake, not

Just

future.

bad attacks

of

This

than

future than in the

for the national

prices,
•An address by Dr. Rodders at the An¬
nual Meeting of the New York State Con¬

the

in

a

to

pushed

sea!"

today

true

Greater stability may be
expected in the economy in the

ahead, they

plans

credit

plans for such
and

and

every

more

tribution

(1)

to meet.

adopted because of lack of

lacked

man¬

Consumer Credit

confi¬

swing would

They had to have cash, and the volume in dollars in 1932 was
only
development of consumer credit 38% of 1929, but by 1936 it had

♦than

in

real

all agen¬
immedi¬

the New

tion.

or

dence, for several

business is in¬

their

restrictive

Some

The

credit volume that the downward

York -avoided when business
begins to
Exchange! Because of their •slow up in the future.
own capital problems, the manu¬
Looking at the record of the
facturers were in no position to last serious
drop in business ac¬
on

grantors

with

grantors.

Stock

nearly 40
states. The licensed agencies
oper¬
ating under this law aid in level¬

whole,

a

fi¬

business

subway

a

cars as

pleasure

Foundation

loan

were

credit."

than

put it,

some

interested

more

taking of interest.) In fact, it was
our
time—only 40 years ago—

in

make

not be

nanciers,

the

should

Cleveland and Williamson

Church

against

car

downturn in

a

was made in this
country (1908),
promoters regarded it as a passing
toy and would not finance it. As

philosophers that money was
barren, i.e. non-productive, and
prohibitions

after the first

years

credit

future

thou¬

and better

living for the American people of customers and credit
is generally admitted.
It seems It is this last danger that
indisputable that the automobile cies in this field should
industry could not have made its ately begin preparations

it in the form of food and assist¬

the

pro¬

a

enrich

when he uttered it.

be dras¬

reserves

Such competition is desirable

even

over

become

Consumer

face

eye."

the business cycle. Just as in the
case of the
increases, this is

history. From the earliest
beginnings of civilization, man has
the

appropriate

credit destroys tra¬

ditional habits of thrift, and there

written

had

an

car¬

swings of the business cycle.

Credit

is

those

are

consumer

is

year.

wide-

credit,

Webster
to

manufacture

commerce

has

dignified

of great prestige,

with

on

This

on.

thinks

that

Oldest

extremely

an

current

labor, stim¬

ulated

business

can

eniorce-

kind than all the gold mines in the
world. It has exalted

been

because

quotation from Babson.

of

economy that
consideration
of its contribution will
give us a

mighty

a

iegany

consumer

more

has

and

.

our

to

times

been, little

around

so

as

when

a

Daniel

great

sorely needed.

particular, fluctuations in income

business

future

this century when bank¬

.

any

liable" and

quarters.

some

But, above all, it is
which is fraught with

a

the

tice is dangerous and vicious.
salvation
and, at the The instalment business is making
time, paradoxically, bitterly our citizens dishonest and unre¬

condemned in

force

of

use

tically loosened. Stricter current
policies will permit a greater con¬
tribution later when it may be

addicted to

economic
same

banks

aggressively seeking
This, of course, is
change from the earlier

was

ried

1938,

Roger Babson
insisted that the case against in¬
stalment
buying by consumers
was "not only
pecuniary, but also
spiritual.
The crime of instal¬

from

large

they

late

their* facilities

economy

grantors

tue

sand

One of the obvious

are

profession

utilizing such

steadily increased in

and

the

are

"are getting the marble out of the

basis.

The phenomenal
sumer

a

goods,

gree of aloofness

And, it
in

af¬

business

which

middle

prob¬

families.

consequential

in all lines. It
a

of

entire

credit

begins to slacken next

business.

quite

the field of consumer credit

fects the sales
is

lems

the

by

guaranteed

abie contract!

claimed, "Credit has done

the need arises credit

ing

an

in the early
knowledge
of

things to do
is to
tighten up operations all
along the line now, so that when

years of

the solution of the financial

in

enable

credit just has
His rate of saving

consumer

thrifty!

Long beiore the

happened

credit

better

and

be

spreau

what

durable

durable goods in all his-

of business.

has de¬

consumer

Should

Crowding the sales fi¬
nance companies, which
pioneered
in financing the sale of consumer

coming slowing

Financing the

agencies for this

of

consumer

constructive

business.

tory and it also acts to expand the upward swing and contract
the downward swing of business
cycle. Predicts consumer
credit volume will not be seriously affected
by
up

in

gooas in all history.
In
there is surprisingly keen
competition among the various

Holding consumer credit is oldest form of credit, Prof. Rodgers
ascribes its growth to fundamental need for it. Contends con¬

<-

Volume

Downswing

durable

-

Credit

Knowledge

consumer

of

user

to

.

credit agencies provide
adequate
financing for the greatest produc¬

-

New York University

consumer

but
»

is

Consumer Credit Agencies Today

Professor of Banking

for greatest distribution of

showed

f

'

**

Hold Up Better in the Coming

By RAYMOND RODGERS*
Graduate School of Business Administration

volume

decline.

<

t

21

Exchanges.

and

San

Francisco.

Two With Inv. Service \

much to say that, as ar-meanscof
(Special to The Financial Chronicle)
^»
promoting thrift in the form f of
DENVER, Colo — Laura L.
acquisition
of
actual
durable
goods, consumer credit has done .Kubin-and-J, C, Wolard have beinfinitely more than all the wise icome ;connected with Investment.
-

-

sayings and copybook maxims of .Service-Corporation, 444 Sherman
the past.
In plain English, the Street.
*•*\

22

(2034)

,

lifted the

Woild

posed
of

a

(Canada)

which

world

trade

of

ances

largely
count

on

of

ac¬

t h

Economist

of

1'ense against

the

of

whatever is

*

from its

8.1%

and

that

quires
price for the metal, and although
this would have the joint effect of
increasing supplies and reducing
black market depredations on

have

been

univers¬

ally

in

since

force

the

them

end

of World

II,

greater
production
re¬
the incentive of a higher

ons

War,

there

the

at

powerful

has

time, there is

same

opposition

been .much

devaluating

feared, and naturally

o

to

as

in

the

United States where the currency

discussion
late

it

to

f

the

this

of

and

consequences are

In view

so.

the

of

endeavouring

difficulty in
conceiving any plan for the vol¬
untary redistribution of present

to make all the

stocks that would not also

offend

the

of

necessity of

1 d's

w o r

rencies

cur¬

H. A. Stevenson

United

unre¬

strictedly

convertible

changeable.

economic

Few

inter¬

and

would

quarrel

that

tinue

rencies

is

essential

for

cur¬

the

freer

and fuller

exchange of world
modities, but how it can be

com¬

done

free

is

a

seems

be

currency is dependent

on

striction and discrimination.
is all to the bad.

tentious

con¬

the

fidence placed in it and that
fidence in turn depends on

adequacy of the gold

any

been

con¬

seas

the

by

reserves

which
the
currency
is backed.
With the exception of Canada and
the United
States,

con¬

hampered

During the past two

convertibility of

if

as

convertibility of
long way off and

international trade will
to

the

by and to
suffer from exchange controls re¬

.is another matter.
The

it

free

currencies

with the contention that freer and

convertibility of

States,

worldwide

fuller world

nationalism

economic

This

years

por-

so*

the

is

free

a

exchange market,

and the question is how and
where
are
the

from" the

large gold defi¬
ciencies, obstructing convertibil¬
ity, to be met.
For

tion

many

world

years

produc¬

of

growth

striking,

of

with

now-

a

two

year

or

parison
still

with

been

running

what

of

and

it

was

by

com¬

it

years

is

impressive.

more

One of the normal consequences
of this industrial acceleration in

in

overseas

times

has

been

finding
its way into private
hands, largely
for hoarding, and into
industry
and

into

not

tary

the

world's

As

reserves.

much

mone¬

85%

as

have been
one

in

up

this

way.

Mankind

prefers the security of
gold to the insecurity of the cur¬
rencies that lack it and for
years
has
been

purchasing

quantities
at

black

excess

of

the

enormous

precious

market

postwar

less

now

a

relative

and

world

has

there

looks

ment

none

very

to

dollar

above

be

-

there

is

and

that

some

considerable

modities have been
to

such

extent and

an

steadiness

as

much

better

stances,

it

would

these

cannot

unless either

an

impetus is given to gold produc¬
tion

and

that

production

tively protected against
private raids, or unless

£i..d

'From
to

an
address by
Shareholders
of

Mr.

effec¬

Barclays

Bank

^Canada), Montreal, Can., Nov.
18, 1952,




is

a

the

of

a

price

its

with

with

fore

structure.

our

few

fiscal

year

enough in itself to
a

on-

w\ linn

r»

much

marked

of

de-

i

r

V

11

claring, "there

price levels of

n

as

o

/J/MI

n

m <c t

v»/-l

r

* A

thing to

We

see.

pleasing
however,

can,

has

A pause in new plant con¬

struction while demand

present

or

capacity in

New York Stock Exch.

grows

prospective

some

a

We

progress.'
Shields

Mr.

confi-

expressed

lines,

(2) A shift of demand for dur¬

goods from private to public
sources
as
private expenditures
UU

pjl A V U

reduced

are

public outlays for schools,

as

hospitals, roads, etc. are expanded,
(3) A shift of emphasis in busi-

l

for

inflation

as

sub¬
chief

the

in

factor

be

econ¬

omy"; prices will be more stable,
with less danger of extreme in¬

flation

deflation; the economic
will be generally more

or

climate

favorable;

government poli¬
"designed to facili¬

and

cies

will

be

tate

the

great

made

growth

economic

possible

the

by

surge

up¬

in medical, agricultural, in¬

ward

dustrial.

metallurgical, and

man¬

agement technologies."

V-AMV.ilWJ.l-Mi

IV,

facilities

pjan^

1

stituted

the

will

"Confidence

dieted,

up

over¬

able

Thomas J.

Euper Joins

Akin-Lambert Co.

expend^res from the

slow

been

economic structure, has not
unfavorably affected employment
or
seriously disturbed our pros¬
perity and welfare.

P

-

y

^

from selleis to buy-

,

mar^ets in many consumers

-rs

goods lines where
been

backlogs have

exhausted,

(5) A reduction in the rate of
marriages and, therefore, in the
"new family" demand for homes,

housing equipment, and automo¬

biles,
(6) A slackening in the pace of
The New York Stock Exchange consumer purchases while many
has announced the following firm families reduce
their debts and
changes: Fox, O'Hara & Co. will build up a larger equity position

Weekly Firm Changes

be

dissolved

Andrew

liard

&

Howard

Son

Charles

November

on

J.

from partnership

will

W.

15.

in

29.

retire

Eaton

(7)

30.

have

A reduction in

our

exports

j

1

i

1

i

•

acute shortage to oversupply m
many basic raw materials, and
Sagar to Albert Rothenberg will
(^) A critical phase in managebe considered
by the Exchange ment-labor relations when many
on November 26.
/
companies may not be able to pay
the

of

late

Wflliam

S.

.

of

the

Exchange
late

mem-

William

S.

the annual rounds of wage increases

which

Hernon to Judson S. Smith will be

apparently

considered

the

union

leaders

"cannot afford not to

have "
vt*

Nov. 26.

on

-

•

*'

*

Mr. Shields called

'

of

With Waddell & Reed
„

.

our

(Special to The Financial Chronicle)

BEVERLY

Euper

has

become

Akin-Lambert

with

La

of the Los
ui
H1C
UUO

Salle

associated

Co.

Inc., 639
members

Street,

Angeles Oliu WUU x x
and San FranMr. Euper

XlUfttAVO

cisco st0ck Exchanges.
was

formerly

in the trading de—

of Dempsey-Tegeler &
and prjor thereto was an of-

partment

Wvkoff & Co

P Edgerton

e

°* JLage

'

wy

v

1

Taylor Joins Hill Richards
(Special to The Financial Chronicle)

I
j

Euper

LOS ANGELES, Calif.—Thomas

South

Transfer of the Exchange mem-

bership

J.

(Special to The Financial Chronicle)

gressively for markets,
'
(8) A shift from conditions of

Nov.

on

Thomas

bought

J.

_

n

they

European and Japanese producers compete with us more ag-

'
rt

homes

as

withdrew

Company

the

recently,

in J. J. B. Hil-

November

from Shields &

bership

be¬

(1)

e£fi^ncv g

and

the

may

Government, in May last,

the United States
time, these "significant readjustments":
said,

orderly and in no way violent P'°ve,"e
up to the present, thanks to '
resiliency and adaptability of ^ ^

and

just

Indications

shields

fromfacTthat

get some relief
the price retreat

States, have

months

really wild inflation, and
must devise government policies which will insure
that the full potentialities for economic growth involved in the resurgence of technology will be
in

omy

stimulative

an

:'may expect,'in

and

a

severe

increase in international tensions or all-out war, Mr.

r*»A*-»/»In

naturally create

very

depression

a

programming."

UVU1

•

1

v\ vn n/\

of

Barring

has been in progress
the face of it and inas- j0r
downward price trends

apprehension, it is not

.

on

depres-

deiice that the new Administration would give a "new look" to
the business outlook and usher in
a "new era of good feeling in
which relations between government, business, labor, farming, and
nomic stimuli, and there are so finance will be far more propimany signs of maladjustment here tious
than they have been for
and abroad that we dare not rule many years past." Under the Eiout of all consideration the possenhower Administration, he pre-

reces¬

ago
At

and,

such

impending descent became
some

a

growth,

to

year

and also— and most impor¬

noticeable

Coin-

contraction by
that of a year

heavy

sion from the high

com¬

World price conditions are our
price conditions and the changes
that have been taking place over¬

own

have

movements, the

Transfer of the

of
Stevenson

these

demonstrate that

more

tant! v—in the United

values

tendency to recede

This data is

so decidedly as to
sug¬
that the long postwar infla¬

seas,

come

ago.

to indicate

had their inevitable effect
some

estate
a

half

comparison

World Price Conditions

seem

be fully solved
extremely strong

first

suffered

circum¬

that the
worldwide inconvertible
currency

problem

the

reverse

gest

have

previous high levels.

cident with

swinging

hungry in

the

securities

Real

shown

from

that, de¬
spite the drain of military re¬
quirements, world supply has
come

maturities

long-term

Government budgetary surplus for

the decline

on

-

Under

also

time

world prices of many

now,

and

investment

check excessive money and credit

that, of existing world tion has been more than
reserves, approximately 70% is in checked and that
deflation
the United States and
likely to re¬ be quietly afoot.
'
there.

term

into line with
defi¬ current world demand. The pendu¬
from the lum of prices has been

for the fact

main

is

important* develop¬
noticed

larly upward"
Shields

Murray

been

our

area.

this,

from

ourselves

save

earn-

have suffered particularly. Indus¬
trial bonds and other first class

gold

ciency.
This position,
viewpoint of the gold
countries,

and

long term

many

that, thanks mainly to sound in¬
ternal money policies
designed to

For

inflation

stationary,

and the

another

one.

vastly increased world volume of
paper currencies, world volume of
gold reserves has remained more
or

exchanging goods with
on an
increasing scale

to

"spectacn- ^*"(3)

a

sagging
slowly for'coming Administration to "attack
months and today's price 'the problem aggressively and
list
compares
very
unfavorably promptly," adding: "The series of
with the one of a year ago. Fur- booms we have already experithermore, the Government's hard "enced has lasted to long, the inmoney policy has steadily raised
flation has been so intense, debt
the interest yields on Government "has risen so fast and so far, we
bonds and the prices of middle -are so dependent on artificial ecohave

supplies, inflation in many coun¬
in tries has been kept well in hand.

World's Gold Reserve
Stationary

While

they

program,

strengthen it by introducing some
more
time - tested devices, and
adapt it to our new situation so
that our people can have confidence that we will not, in trying

^tertain for one moment any o' quickly out of a depression if one
joint"those curious notions of economic does develop .
provide addihandicaps of rising labor costs and 'matU"ty and, stagnation wh.ch tional incentives to saving ... rehigh taxation have not been as'were s0 P°Pul« m the 'thirties." cast our tax system so as to
remunerative as in the previous ■;
The risk of depression, although provide new and more powerful
year and dividends on the whole
present, Mr. Shields stated, does incentives to investment . . . and
have not been quite so well cov- not
seem to be- imminent, and remove the threat that action by
ered.
Stock market prices have there is
still time for govern- government regulatory agencies
moved in sympathy with this and, ment to organize an adequate de- or abuse of their power by the
with occasional reactionary spurts, * fense against it. He urged the in- labor unions can be a drag on
instances corporation
ings and profits under the

metal

prices much

of the fixed

that

and, in the process, have become
much more competitive with

the world's
1951
output, ex¬ Canada
cluding Russia's, is said to have
Over

swallowed

is

another

of

been

countries

,

.

*Tn'is n0w n0 reas0n for anyone t. fully used in helping to carry us

unload

tn

easv

many

always and

gold has been falling off
and, moreover, by far the major
part of what has been produced
recent

the

.

less

1

ago,

prewar

undergoing

not

and

has

volume

excess

is

become

instances

some

output

greatly in

a levelling
Tangible evidence of
lacking. Money sup- ^
plies have been fast tightening,
with cash in stronger demand for,
amongst other purposes, the car¬
rying of large inventories built up
at high
prices and which have

this

.

from the New

months, but sion, undermine the soundness of
predicted over our money and wreck the econ-

yield.

contributing to the world output
a heavy way.
Each country still

In

we

out process.

several

enough to justify careful planning

in

critical.

been

that

the

for

next

sibility

has made great strides and is

most

have

doubt

small

ness"

depression
sound

anti-depression

Deal's
-

busi-

good

the trend to lower cost and higher

extremely few
has its own economic problems
can today
enough to but, generally speaking, produc¬
undertaking the risks at¬ tion as such is no longer one of the

permit

or

over¬

many

countries' gold reserves
be
considered ample
tached to

year

a

^

detake

We should prepare our

"(2)

the Manhattan

Company^ mot
only - forecasts
"generally

apex

under this influence and followed

countries. Not only in West¬
Europe but in other parts of
globe industrial production

ern

Bank

have

changes

taking place in

of

Most groups of commodities'*
joined in the fall with varying de¬
grees of severity and, simultan¬
eously, the cost of living index
fell
2.6% during the mentioned
period.

Much

controls

decline

a

ago.

plan
can
be devised whereby,
apart from the force of trade, the
existing world stock of monetary
gold can be redistributed to the
better advantage of the gold de¬

"

showed

August,

and

dent

into

confidence from developing
'overconfidence boom.' .-f.

an

in

ficient countries.

e

multifarious
restrict i

fallen

have

payments

economic stimuli have exhausted
themselves. And we must be very
careful to prevent ;a revival of

gleaned from the official general
index of wholesale prices, which,

There
into

.

-

of world commodities, points out, because of
inadequate gold reserves, unbalanced international payments,
and unequal distribution of world's monetary gold supply,
restoration of convertibility "is long way off and international
trade will continue to be hampered by exchange restrictions
and discrimination."
Sees, however, improved developments
in many countries checking excessive money and credit sup¬
plies, with inflation kept well in hand.

-

there is time for adequate defense against it.

be fully<*
spite of it,

in

Spectacular Uptrend in Business

commodity prices have, with some
Addressing the Annual Finance
few exceptions, continued to falU Conference of the American Mangenerally and almost uninterrupt-agement Association in New York
edly ever since. Some idea of the. City on Nov.-19, Murray Shields,
extent of this movement can be
Vice
Presi-

fuller exchange

and the world's international bal¬

t

The need there .•'*

for,

November 27-1952

Murray Shields, Vice-President of the Bank of the Manhattan
Company, says risk of depression does not seem imminent, and

for this step can now

appreciated,

Bank executive, though holding free and fuller
convertibility of currencies is essential to freer and

condition

Predicts

im¬

been

after the outbreak

year

in Korea.

war

was

Canadian

Arising from the unsatisfactory

had

which

measures

By H. A. STEVENSON*

world

anti-inflationary mone¬
credit restriction,,

tary fiscal and

Currency Convertibility
Coming, but Still Far Off
President, Barclays Bank

The Commercial and Financial Chronicle .V.Thursday,

•

-

•

attack

"(1)

which

on

for three lines

these problems:

We must devise means by
can
so strengthen our

we

SAN FRANCISCO,

Calif.

—

Taylor has joined the
staff of Hill Richards & Co., 155
Montgomery Street, members of
Philip

B.

Calif.—Nettie economy during the months of the San Francisco and Los Anconnected good business which lie ahead as geles Stock Exchanges. Mr. Taywith Waddell & Reed, Inc., 8943 to reduce the threat of economic lor was formerly with Hannaford
Wilshire Boulevard.
setback when some of the present & Talbot and Walter C. Gorey Co.
E.

Moore

Hills,

has

become

Number. 5172

Volume 176

..

The Commercial and Financial Chronicle

.

(2035)

Predicts Lower Stock Prices
Bernhard

Arnold

Value

of

Line

Survey

Average will decline to 220 in next two

;

and thereafter

by 1960. Bases current bearishness on declining world
commodity prices, fewer prospective family formations, and
recent anticipatory investment in new capital and equipment.
Arnold

ment

Bernhard,

founder

the

of

Line

Line

before

in

address

an

the

Club

D

Jones

220

in-

the

next

rise

440

sion,

potheses,

of

He

Bernhard.

he

forecasts

torical

stated

Mr.

will

makes

of

his¬

may

both

And

in

our

distributions

decline.

to

earnings

His

likely

are

indication

is

that

somewhat less, and the Dow-Jones
Industrial
stock
average
maybe

20%.

declared

He

in

the

years—on

the

of

280

that

next

there

two.

basis

Outlining the

of

because

that

the

is

is

is

a

game

a

prob¬
with¬

determined

DALLAS, Texas
Nicoud

First
1401

is

Main

consumption.

And

native

of

Bank

Southern

where

would

an

end to the

favors

its

budget

to

"first"

ex¬

end.

the

to

of
Administrat'on

For

combat

inflation
So

is

he

pre¬

profits tax

excess

a

will

of

20

million

in¬

crease
in
population,
a
2%%
yearly rise in worker productiv¬

ity,

39-hour

a

week, and
Such

a

indicate

would
a

share

trial
on

a

near

gross

on

"average"

dividends

stock

Nicoud,

For

hard
shares.

the

$25

come

up'with

average.

Issues for

Short-Term

L.

the

to

came

received

a

from

He

at

times

has

whether

on

Turning to the factors supplying
dollars abroad, it may be observed,
that annually with but a
single
exception from 1946 through 1951

there

was a substantial increase
in
the amount of commercial or trade

mentioned

of

in

banking

and

,

;

utilities natural gas, food, chewing gum, baking stocks and CocaCola
as
examples.
"Prince and
pauper" industries like automo-




Balance

Viewed

E.

Mr.

F.

D.

Heatherington

/

.

tioned not
times

,

an¬

Wente,

had

then

i

Byllesby Co,

York

asso¬

M.

The

the

firm

removal

office to -33

also
of

and

few

a

an¬

the

New

assemblies

dence that in the

early

National

Conventions

Foreign

Trade

little attention

as

Guardian Chemical Corporation
and
Batkins
&
Co., 30 Broad
a

cocktail

were

hosts

party on Nov. 20, at

Alfred R.

culosis, tetanus and other disease
organisms, and has
ous

industrial

plications. About
tended

as

and

well,

numer¬

consumer

200

ap¬

dealers

at¬

given to the broad question
foreign economic policy as was
to

the

The

balance

two

and

rather

must

we

increasingly

in

matters

of

terms

pay¬

together.

go

days when

neces¬

consider

the

of

In

whole

than merely the isolated
foreign economic policy

and the balance of payments rep¬
resent inter-related

the

basic

same

of

ance

flects

approaches to

issues.

The

bal¬

payments both acutely

the

actions

that

flow

re¬

from

policy

and simultaneously raises
questions for future policy con¬
sideration.

Nor should

is

there

forget
continuing vital

a

we

The classic statement

icy.

subject
than

was

Fla. —Murray

made

on

slightly

this

more

o

NEW

Cassell
are

Inc.

now

the

E"

financial

1J

chronicle)

ORLEANS, La.—Keith C.
and

Robert

E.

Hepinstall
with Renyx, Field & Co.,

nearly

own

corresponds

personal

counts.

But

just

our

household

or

to

ac¬

for

as

the

firm

its

in

affairs

manage

we

our

home."

at

Although his
remarks were addressed primar¬
ily to the situation in the United

Kingdom,
well

ment

the

statement

sum up one

for

—

which

of the major
persistent

Britain's

difficulties

contains

even

the

state¬

wider

impli¬

—

cations.
To

and

the

financial

analyst

the standpoint of policy^

not

wrong
Granted

only

tunate.

the strictly

the

that

insofar

as

mechanical features of

*An address

fore

but most unfor¬

tion,

39th

by Mr. Heatherington be¬

International
National

Finance

Session

of

Foreign Trade Conven¬
New York City, Nov. 17, 1952.

the

dollars
as

were

than

1927-29.

average,

times

as

commercially

in these earlier years,

approximately

more

Comparing

1936-38

than four

in

the

Part

three

boom

of

times

days

of
expansion

this

obviously reflects higher unit
prices, but the net gain to foreign
countries

still

is

impressive after

discounting for the decreased pur¬
chasing power of the dollar. Much
has been

made

the

of

failure

of

the

United States to enlarge its
volume of merchandise imports to
the degree the higher level of na*

the

tional income would

balance

of

payments.

I have dealt at this considerable

with

what

to

must

you

elementary concepts for two
reasons: First, because I feel that
we

all

are

too

the whole in
for

prone

our

the

to overlook

immediate

parts,

and

fail to trace back to

con¬

thereby

source

causes;

secondly, having established that
the

balance

ther

of

abstract,

trived,

it

in

brief

in

the

is

payments
fortuitous

possible

to

is
or

nei¬
con¬

consider

of the forces which

some

recent

have

past

affected

balance

our

take

of payments and to
look at what may be ahead.

a

Before

doing

so, however, let
clarity emphasize
one
fact which already has lent
itself to misinterpretation.
As a
for

me

of

sake

convenience

we

often speak of "fi¬

nancing the surplus" or "financ¬
ing the deficit" and present the
figures in this form. "Surplus" or
"deficit"

here

ference

represent

between

available

through

to

the

dollars

foreign

normal

erations, such
goods

and

eign
plus

countries

tal.

is

neither

deficit

sur¬

could

arise

of

means

be exchange reserves, loans

loans and credits

is

taken

before

to in¬

or

the

surplus

created, not after, and is

untary act.
as

pur¬

the

credits, or investment capi¬
Ordinarily, the decision to

extend
vest

the

by for¬

similar

for

the

and

financing
also available, whether the

means

and

the

nor

op¬

the purchase of

services;

Clearly,

dif¬

made

commercial

as

countries

unless

some

counts

of

or

a

vol¬

On occasion, however,
you with unpaid ac¬
frozen

balances

have

good reason to know, the exten¬
sion of credit is quite involuntary.
But,

generally

credits,
are

grants

made

existence

tribute

to

speaking,
loans,
and investments

without
of

a

reference

surplus

and

to

con¬

seem

to

war¬

rant.
in
on

Without, for the moment,
any way expressing an opinio:.!
this contention, it is neverthe¬

less

evident

price

from

indices

that

comparative

the

commercial

dollars

able in 1951

were

amount

made

of

avail¬

sufficient

over¬

all to

permit foreign countries to
purchase twice the quantity of
goods and services as were bought
in the years 1936-38.
The greater share of the dollars
supplied, of course, have repre¬
sented

payments for merchandise

imports. From one-fourth to onethird, however, have been for the
so-called

"invisibles"—transporta¬

tion, travel, interest and dividends,
personal gifts and remittances, and
miscellaneous

services.

With

the

exception of personal gifts and re¬
mittances, each of these has reg¬
istered

a relatively small but still
important rise since 1946. To give

idea

some

of

the

magnitudes

in¬

volved, in 1951 around $900 mil¬
lion

was

ices,

$70

spent for transport
million on travel,

million for interest and

$400

million

tances,

and

in

$1.4

serv¬

$400
dividends,

personal

billion

remit¬

for mis¬

cellaneous services, irlcluding con¬
struction work
.

To

these

overseas.

commercial

dollars

be added the amounts pri¬
vately
invested
abroad
which

may

have averaged nearly

$1 billion a
annually, from 1947
on, more
than $10 billion have
been put at the disposal of foreign
economies
through
the
normal
channels of purchases or private
investment. Under ordinary con¬
year.

Thus,

ditions,
therefore,
flowing abroad on

the
dollars
commercial
basis should have been adequate

to

cover

a

requirements. This is not

to say

that such expenditures and
investments might not well hara

been

even

stances

greater had circum¬
Yet, it is inter¬

allowed.

esting to observe that by and large
the sums expended, both before
and after price
corrections, ex¬
Loans are Not for Excess
ceeded the general run of esti¬
Production Disposal
mates made immediately following
At
various
times
the
United the war. Taking 1951 as an exContinued on page 40
States has been accused, even by
bringing about

plus rather than the

-

the

and

$1 billion.

more

summary record, every act
and
action bearing
on
external
relations come to final focus in

were

is in the end mainly

is, from

to

more

In this respect, it perhaps

of- payments

governed by how

theorist
•

sions."

poses.

-

Avenue,
I

esti¬

ordinarily also includes
entry reading "errors and omis¬

an

payments policy are
all part of the same story; that
surplus or deficit in the balance

of

-

regard the balance of pay¬
ments as dead, dull history or the
exclusive property of the abstract

Join Kcnyx, r leid

com¬

informed

balance

C.
Mathews is now associated with
Goodbody & Co., 203 South Palm

(Special

of

is

amount of dollars utilized

year ago

postwar
(Special to The Financial Chronicle)

part

the balance

by the Governor
of the Bank of England when he
asked: "Is it clearly enough un¬
derstood that internal policy and
a

reasons

Goodbody Adds to Staff

in

cern

then
of

may

the meeting.

SARASOTA,

payments

was

between the balance of pay¬
ments and domestic economic pol¬

Batkin Co. Preview

which

reminded

am

mates and

coinci¬

a

link

Guardian Chemical &

Street, New York City,

supplied

many

deliberations of

that

Wall Street.

of

with

that for

ly," since I

term, the balance of
has become virtually

mind it is not

devoted

Byllesby and
Incorporated, as head
York Trading de¬

partment.

passing.
later, there

than

1951

many

length

ments.

New

nounces

three

or

in

only

more

"rough¬

I say

seem

To my

parts,

their

as

expenditure record.

nations.

recently

John W. Bair With

of

remote

may be considered
of external transac¬

field

billion

off-year
which registered a de¬
cline of around $900 million from
1948.
Despite this drop the 1949
outlay exceeded that of 1947 by

slightly

to at least 15. If not yet a common

sarily

H.

the

Payment Concept

$7.7
one

1949

roughly the national
equivalent of a firm's income and

jurpped to eight, and by 1951

these

with

now

allusions. By 1935 the total

vague

succeeds

who

retired.

H. M.

tions

than two

more

and

liamentary

an

F.

Buccello

Townsend

payments
the

that in the chancellories and par¬

Mgr.

Carl

by

of

statistically, the balance

of

rather

household

America, according to

nouncement

defensive
electric

The

in

in

doubled, rising from
$15.5 billion. The
was

Na¬

University, Again, in 1925, 20 years
were three
references
degree of

Advertising Manager of the Bank

short-term, Mr. Bern-

recommended

these

seems

a

FRANCISCO, Cal.—Henry
Buccello has been
appointed

Capitalized

average.

stock-price

Defensive

of

the Dow-Jones Indus¬

5.6% basis, you

the 440

work

full employment.
national
product

the

of

signifi¬

payments,

statement

Globus, inventor
of
the
process,
discussed
the
chemical
composition of "Clorage at 440 is based on "probabil¬
pactin." This new composition was
ities" of gross national product of
$425 billion by 1960. That's bassa developed for use against tuber¬
projections

At

posed

SAN

at

long-term

outlook for a
Dow-Jones industrial stock aver¬

on

the
way

it, to every in¬
dividual, particularly to those of
foreign trade community.

po¬

payments
a s
such was men¬

Dallas,

Of Bank of America

balanced

a

modified, not killed.

The

con¬

no

broad

of the balance of

reasons

die,

philosophy

consideration.

dicted
be

allowed

the

Eisenhower

the

extent

for

in

of

graduation

BucceSlo Adv.

Company,
may

of recession, he

be

though

con¬

are

one

this

the

fairly obvious

John W. Bair has become

that

a

exter¬

first

payments

excess

profits tax. It is due to

it

even

is

But

from

world of 1914,

Bachelor of Business Administra¬

pire next June 30 but he doubted
that

detracts

the balance of

in

Methodist

he

ciated

thing

That would be

excess

task

technician.

M.

Mr.

Dallas,

upon

of

Factor

one

alter this picture

said.

and

stimulus

Korea, and the "irrational"
profits tax.
EPT

lesser

a

the

This

years.

the

to

what

we

capital

new

equipment in recent

is

the

cerned,

ventions

have witnessed much anticipatory

There

to

public

centra ted

shortages might be created here
•through placement of too much
purchasing power in the hands of
foreign buyers.

will

interpretation

with

Bank

Street.

President.

in

and

full

Robert

—

associated

National

L.

from

its

an

annual

First National Bank

.shorter-term

1932 depression
family formations
in the coming few years, too. That

investment

of

nally.

emotionalism,"

three

or

fewer

resulted

that

sition

Robert Nicoud With

indicate

,

the

tional Foreign
Trade
Con¬

formations in the

affect

to

Mr. Bernhard concluded.

probably

outlook,
Mr.
Bernhard
pointed out that commodity prices
are
declining in world markets.
Usually that prompts people to
postpone buying.
Fewer family

can

this

benefit of any

out

market

■

from

statistician's

hobby-horse

founda¬

And it is

probability,

why he is

reasons

about

struction

cor

to

earnings and dividends.
bearish

been

the

the

reason

one

a

consuming

the balance of
payments, its

pay¬

for

.

country's

that

tion,
majoring
in 20 chance that the
finance.
average will exceed it's 1952 high

only

-

econ¬

skid 30%, dividends

may

•

elevated

economic

of

provided

or

the

dollars provided foreign countries.
Between 1946 and 1951 the total
thus made" available more than

there

assumes

corporate earnings and

dividend

an

to

Value

or

after 1953.
Unemployment
rise to 6%, he estimated.

omy

been

of

stim¬

claim

no

slack

some

role

recent

balance

from

and what is behind

ability

that, while

himself

Bernhard

be

ments

relatively

the

dollar

cance

of

Line.
-

has

wise

and

accepted

for

Mr.

certain

to

for

within

can

hy¬

said

basis

the

on

omniscience

certain

on

reaction

he

uli,

Bernhard

course,"

*

Only

grants

been

unwise, entirely
marketability of
domestic production.
Actually, the
worry in Congress and
among the
apart

continue

memory

have

reasons,

a near-

demand

great

dollar

of

credits

sification

prob¬
is based

or

foreign aid, but

supply, but concludes dollar
heavy for a long time.

funds

buy enumerated items

guide

And
Arnold

conclu¬

ability,

dollar

aid

tion of sound investment is diver¬

1960.

by

"Any

body

to

commercial

to

of

I shall not go into the
pros
cons of these
acts, the

bulk

Payments concept,

for upturn in dollar demand. From a
long-term
viewpoint, says there may be expected a continued increase in

30 analysts,

by company. "Since no¬
project with absolute
accuracy,
it is obvious that the
best of analyses miss on occasion.

and

then

in U. S.

term prospect

portion

—and

a

company

two

years

are some

specialist in one or more
industries, who are charged with
projecting earnings and dividends,

about

Foresees appreciable reduction

the

Variations from the

can

Survey

each

would

to

drop

dividends and

comparison.

av-

g e

e r a

com¬

corre¬

Line

indus¬

trial stock

Sur¬

then be detected by
Behind
the
Value

average

w-

o

the

to

Line

Value

of

its

of

requiring

specified

be used

and holds, throughout much of the
world, the difficult situation
today is due to capital shortage and not dollar
shortage. Dis¬
cusses current
balance^of-payments problems and finds foreign
countries lately have been able to add
to their dollar reserves.

.

of stock prices on a mathe¬

matical basis.

predicted

■.

the

explained

the

earnings,

curve

Nov.

on

that

Heatherington explains the Balance

disposing

production.

While it is true
that provisions have been
inserted
in legislative measures

and

Mr.

group of over 300 West Coast in¬

late

Fran¬

San

cisco

Bernhard

vey is strictly
a statistical
putation. Its objective is to

Com¬

are

of

purpose

excess

a

Director, European Division
National Foreign Trade
Council, Inc.

biles, steel and machine tools
Mr

sole

By D. F. HEATHERINGTON*

vulnerable.

vestors

meeting

open

1 0

Funds
an

mercial

in

and

Invest¬

Survey and President of the

Value

at

Value

of its
friends, of lending
granting dollar funds for the

and

Balance of Payments

double

editor

certain

Trade, Finance and

Dow-Jones

says

years,

23

a

reverse.

sur¬

14

NYSE Would Reduce

New Orleans Exchange
Our

Gets Slate for 1953
Woolfolk

Shober,

nominated

been

Reporter

Governments

on

By JOHN T. CHIPPENDALE,

JR.

Treasury obligations continues to back and
fill within the trading area that has been able to contain these
fluctuations in the recent past. It is a thin and to a very consid¬
The

according

t o

announce¬

an

ment made

ly
d

d

e

bility of

member

of

the

of

Board

Governors. He
will

that are

than

more

small amount of spot buying here

a

The approaching eligi¬

out maturities.

than $6,000,000,000 of the restricted bonds consist¬

more

ing of the 2Vzs due 12/15/63-68, (eligible 12/1/52), and the 2V4s
of 12/15/59-62 (eligible 12/15/52), has brought some anticipatory
buying into these two obligations. The substantial addition that
will be made to the eligible list shortly has, on the other hand,
tended to hold back some of the buying that has been around for

and

t

part by the fairly heavy tax switches

in

The

there in order to fill

and

as

e-Presi-

n

for

made.

been inclined to do

previous¬
c

succeed

G.

the

Keith
New

Funston, President of
Stock Exchange,

York

announced

that

the bank bonds.

Uncertainty Pervades Money Market

&

Erwin

Company,

terim

&

and

ton

Kingston, W. D. Kings¬
Co., have been nominated

&

for Vice-President and Treasurer,

respectively.
Board

of

Nominated

Governors

t h e

to

Russell

are:

Clark, Merrill Lynch, Pierce, Fen&

ner

Beane;

George

H.

Baudean

&

Larz

E.

Nusloch,

Smith;

Jones;

Nusloch,

ar.d

The

Nominating
Larz

Chairman,

Ernest

C.

Jones

Villere,

reported

the

Exchange

candidates will be voted

on

In

One of the

St.
is

been

what

and

reports

the

Consti¬

which,
adopted by

if

the

member¬

shortly after the turn of the

the retirement

rata

maximum

ments

50

would

a

of

nomination

obligations

are some of

Edgerton, Wykoff

district who

ANGELES,
is

now

Calif.

with

—

place

Eli

are

debt

there is

no

immediate

earth shaking as some

as

'

•

7,-

previously

the

The

Committee

with

guided by the belief that only
through'the actual operation of a
retirement plan can a con¬
troversial subject finally be re¬
insofar

as

best

and

concerns

the

it

amendments

memberships within

of

five

a

tion to make

answer

Business
Donald

cate that the

Woerner is with Investment Secu¬

apparently

are

..

B.

Exchange
the

with
ness

period

a

price

not

■'

"

-.J.

\

to

of

in

the

New

is

use

Donald

report to the Board

on

ties

month.

least once

at

must

William
of

man

to

the

the

(

now.

This would

shall

City

Nov.

on

logg,

III.

Harold

are

out long-term

carry

,

1958,

make

significant

as

a

many

of

the

Life

suran ce

Company
New

of

York

"To

impossible in the future
some

prevent

upward

as

and

scientific revolution

not

only

The

powerful

power

activity, the
gen¬

market will be

many,

to influence the

economy

in the

Treasury and the budget will also be important factors that will
direct bearing upon what the new Administration will do

Aubrey G. Lasts ton

question.

or

v

If

a

"

not the Federal Reserve banks will be less

refunding operation

were

longer

reached

are

to considerable

not to be given

some

stated.

that

for

be

•

45 All Ik St.

CHICAGO 4

HA 6-6463

able effect upon the money

turn of events could have

an

markets and the economy

unfavor-

as a

whole.

BOSTON 9

ST 2-9490

L'

a




•<

However,' there

appears

to be little question in the minds of many

as

must

other undertakings

Treasury if there should be need for such aid.

.

>•,

•

".

into

are no

being,

sectors

must

superhuman

that

forces

the

stressed

by the
longer significant.

not
any

but

exist,

or

come

major deflatable

the
economy.
These
assumptions are so far
reaching that merely stating them
of

necessary

raises

sizable

a

business

question whether

fluctuation

dently be
the past.

held

to

c a n

be

a

:

\

,

confi¬

thing of
,

-

^

"Some' among

the

business

us,

argue

cycle has been

are

unlikely—at least

beyond small ripples.

This view

finds strong support in the devo¬

fluctuations, are they still
strong enough to ameliorate," to
limit, fluctuations? The hope thai
this greater stability may result
ness

of

government to

stability,

the

evidenced

cause

by

the

will be fortified if

ment
can

to

all

groups

in

give

increasing at¬
the objective. Govern¬

economy

certainly

can

help,

and

so

private business, finance and

labor. The possible contribution of

business,

finance

and

labor

de¬

attention than it gen¬

Employment Act of 1946 and Gen¬

serves more

eral

erally receives.

4

Eisenhower's

campaign

pledges. It finds strong support in
the

well

o

assume

must

tention

the

as

S

There

fluctuations

money,.market operators but what the Federal Reserve banks will
of the

spots

the present

with

instability

the

be in there

giving help to refundings

government

devoted

used

also

must

substantially abolished," he de¬
clared.
"They hold \ that while
business and employment fluctu¬
ated widely in the past, future

of

^trying to accomplish. Such

be

must

constant.

occur before long. :
"Conversely, the very forces
..However, the continued stabil¬ cited as promising complete sta¬
ity of the American economy is bility are too strong and impres¬
enormously important both at sive to be dismissed. If they do
home and abroad, Mr. Woodward not seem
adequate to abolish Jbusi-

tion

'

soft

boom will

velopments that might work against what the Treasury would be

WHitehall 3-1200

in

There

perience is irrelevant, some inter¬
ruption in the present business

assistance by the Central Banks when needed there could be de¬

231 So. La Salle St.

previous

boom.

& Co.
ST., NEW YORK 5

but

be

greater

INCORPORATED

15 BROAD

of

the

population

skill. Needs must be readily con¬
verted into effective demand. One

is the enemy of the boom."
He predicted that unless past ex¬

managed money

government bond market, this is open

of

also

time

it has been in the past. The fiscal position of the

As to whether

downturn,

a

pressure

only

and

Donald B. Woodward

A

'

assump¬

not

gone on

can

whole.

the level of business

the money markets.

big

very

that the pres¬

refunding operations

situation, the trend of commodity prices and the

used, in the opinion of

future, much

fluc¬

contended

Secretary

followers of the government bond market

as

they

business

tions.

situation.

such factors

upon

in

A.

Scott.

powerful and they compel at¬

requires

In

'

employment situation*

active

Mar¬

Crane Kel¬
Schreiber and

ent boom "has
new

-Economic Factors Will, Govern Policy

international

a

J.

James

tention. But to conclude that

tuations

Mutual

maturing obli¬

believe that the program that will be adopted will be dependent

in

Chair¬

members of

included

Otto

W.

Vice-

search

change in ownership of securities with the

a

£KUT?./r"

markets in

have

a

Committee

Other

Booker,

charge of Re¬

to indi¬

seem

Despite all the talk about what might take place in the money

/

by

was

Special

Board.

President in

On the other hand, who

impact upon the economy

■uir

eral

approved

Hutton

Committee

any

largely

E.

the

heights than textbooks

that might ajnvolve

SECURITIES'

be

majority of at least 688 members.
Balloting will continue through
Thursday, Dec. 4.

Treasury will want to

MUNICIPAL

a

To become effective the amend¬

ments

tell whether economic conditions at that time will be such that the

•

will

its activi¬

interrupted.

Insti¬

Woodward,

B.

for the longer-term refunding operation

being talked about

soon

Controllers

York

February certificates would be rolled over, although

Treasury will

and

allied

am

"superhuman skill" of government, fluctuations in busi¬
be mollified, but not avoided. Says present boom may

important changes in policy, probably not much be¬

which

attendant

is

Committee

may

Addressing the New York City

19,

Mr. Humphrey Must Mark Time

of the

STATE

who

This

of

member

one

Cycle Has Not Been Repealed!

be

Control

rity of certificates might be the obligation that the

U. S. TREASURY

and

Board

member.

Board of

members

are

Woodward, Vice-President for Research of the

gations could be turned into longer term issues. The June 1 matu¬

Company of California, 880

who

consisting

the

Mutual Life insurance Co. of N. Y. tells controllers, despite
pressure of population and scientific techniques, along

tute

there might be a split offering so that some of the

East Colorado Street.

if

upward

to

V.

.

,

fore the end of the current fiscal year.

(Special to The Financial Chronicle)

PASADENA, Calif.—Geroge W.'

than

more

50

at

for

provide

not

Secretary of the Treasury, Mr. Humphrey, will be in a posi¬

new

amendments,

membership. which made the recommendations

the

retirement of

years

the

the

interests of

It is being pointed out that it will take some time before the

With Inv. Sees. Co.

Fund
retired

from

Committee

Governors

was

seat

into longer-term

'

Morton Seidel & Co.

rities

that

limited number of memberships

presumably at increased

_

was

assess¬

offset the loss

to

proposed

rotating

of

inclined to believe that the changes that will take

are

not likely to be

,

He

appointed

unanimously
retirement of

Committee

is desirable.

solved

pro

a

and

Gratuity

be made

of four members of

1952.

May 22,

the things that are confounding the money

To be sure,

in the mood to make them.

Edgerton,

a

Funston

Keith

Committee

concluded
a

G.

the recommendations of

on

This

these possible happenings but there are not a few in the financial

Wykoff & Co., 618 South Spring
Street.

on

dues

the

contributions
The

was

Special

a

amendments,

for

approved, will be administered by

Board's

based

the

memberships.

Jan.

decision

participation in the market, especially dur¬

and the funding of the short-term

rates,

has

annual

an

from-each

to what will take place, such as higher money rates,

as

(Special to The Financial Chkonicle)

Goulden

The

(2)

$180

increase in

of

and

plus
of

program.

Under

mem¬

berships

and

Rumors

year.

from

required to complete

be

may

of

The

happen when the Republican Administration takes

reins

market at this time.

LOS

over¬

are

in the money markets

concern

funds in the market with other borrowers

years

as

the

ing refunding operations; the Central Government competing for

equivalent to election.

Joins

uncertainties that

period,

would
provide for

ship,

welfare and

important points of

less Federal Reserve

by the

on

will

the

nomina¬

Dec. 1.

past

the

of

some

Exchange

the

by

member, payable quarterly, con¬
tinuing
through
the
five-year
period or for such shorter period

the

tution

the

membership at the Annual Meet¬

ing

new

ceived

year

Diminishing Role for Federal?

over

the

to

the

as

Denis J. Villere & Co., and Robert

Wolfe,

before

Committee,
E.

of

financed

be

contribution

Exchange

of

R.

still following
now. The in¬

hanging the money markets.

composed

tions

period

there is clarification of

Macrery

B. Wheeler.

each; the program
by (1) the use
$1,000,000 in initiation fees re¬

will

members elected during the five-

1, 1953.

Administration takes over is not
going to be conducive to important developments in the govern¬
ment market, according to many money market followers. Demand
for funds is strong and there are no indications yet of a let-down
in this competition. Accordingly, it is believed the various loan¬
ing institutions are not likely to be showing more than the same
passing interest in Treasury obligations for some time to come.
To be sure, the thinness of the market makes quotations suscep¬
tible to sharp but limited movements in both directions, and no
sustained breakout from the trading range is looked for until

Walter D.

exceed $45,000

amendments

uncertainty continue to shroud

Sehweickhardt,

R.

Schweickhardt

A fair amount of confusion and

the money markets, so that price movements are
the pattern that has been in vogue for sometime

of

proposed

effective

Woolfolk, Inc., who this year com¬
pletes two years' service as Presi¬
dent.

Nov.

on

would become

Wheeler

announces

maximum

a

to

Macrery B.

Shober

of

Board

approved

Wheeler,

B.

the

Governors, at its meeting
20,

retire

to

a

moved

longer-term obligations, according to reports,
have been somewhat on the inactive side because buyers have not

being

Shober

s e r v e

V i

be

accounted

of the
Exchange.

tary

had

still

can

kinson, Secre¬

Mr.

for

professional market, which means that quotations
rather readily in both directions.
The shortterm sector seems to have a bit larger following, which may be
erable extent

by

At¬

W.

Jesse

market

Governors

of

Proposal subject to approval of majority
of present members.

memberships.

President of

for

the New Orleans Stock Exchange,

John

Board

of

Membership

President of the Exchange,

Funston,

decision
50

Shober, has

&

Keith

G.

La.—John B.

ORLEANS,

NEW

Financial Chronicle.. . Thursday, November27,1952

The Commercial and

(2036)

of

scientific

revolution

and

in

growth and expanding needs
the

>

population.1 Such

forces

"The
ness

present

must

of these

i
position of busi¬

be viewed

in the light

considerations,"

Woodward's conclusion.

was

Mr.

-«

f
A

6

■

Volume 176

Number 5172

The Commercial and
Financial Chronicle

...

election

an

and

tional

Limit

just held in Dis¬

trict No. 13 (New York, New Jer¬
sey

Needed: A Constitutional

Bank and Insurance Stocks

Elects Governors
Connecticut)

Association

of

the

By H. E. JOHNSON

Na¬

This Week
Dividend

increases

Bank Stocks

—

both

past

and

President, W. A. Sheaffer Pen Company

prospective

continue

to

Head of large

*

manufacturing concern, contending thatexpected to give ample tax relief because
of political pressure, proposes a constitutional limit on Fed¬
eral spending and taxation. Holds an income tax
ceiling of
25% would cut Federal revenue by only $6% billion, and with

dominate the interest of investors
including those who follow bank
stocks.

•

Congress

7

During recent weeks there have

been several favorable divi¬

dend actions taken
by major corporations.
been some

While there have also

reductions, the increases have

this

than offset these

more

decreases with the result that dividend
payments by corporations
have been running between 5% and
6% above a year ago. We
would

expect this percentage increase to

full year

W. Doolittle

.Dealers,

Inc.,

C.

Allen

Doolittle,

W.

Roy

Bois

du

Doolittle & Co., Buffalo, N. Y., and
Allen C.

New

DuBois, Wertheim & Co.,
City, were elected as

York

members

from

Board

will expire on Jan.

At

the

15, 1953.
Harold

time

same

H.

Cook, Spencer Trask & Co., New
City; Charles C. Glavin,

York
The

First

New

Boston

Corporation,

York

City; Henry Holbrook
Putman & Co., Hartford,

Hyde,

Connecticut and John J.

O'Kane,

Jr., John J. O'Kane, Jr., & Co.,
New York City, were elected to
serve

Rather most institutions

increase their distributions this
year either by

larger extras

a

year-end payments or by

or

a

of

means

payments

stock dividends.

or

a

in

few instances

rations in this connection include the

more

shares pays $18.00 so that the

following:

dend would amount to

Bankers Trust

an

Northern Trust

new

relation

on

that

a

its

stock

Federal
e

r n

When

the

debated,

and H. Warren

favorably.

curities

prospective earnings and could be enlarged next year if
operations

high

continue satisfactory.

rate

of

18, the

raised from 50 cents

$2.20

against $2.00

as

analysts had expected

City

Wilson, Union Se¬
Corporation, New York

whose

expire

on

terms

of

office

Jan. 15, 1953.

will

/

~

rather

than

The

new

Irving Trust
Last

With du Pont, Homsey
BOSTON, Mass.—Eva Amolsky
has

become

associated

with

on

so

the

in

Nov. 13 declared

a

a

share

as

which increased its dividend recently.
its

quarterly payment from 40 cents
extra of 30 cents

an

to

$2.00

Hayden, Stone Adds

as

declared to

was

compared

It

bring total payments for 1952

compared with $1.80 paid in 1951.

its dividend during

den,

paid.

Mass.

Herbert

—

Frank- T.

B.

Paulides

Hay¬
Co., 10 Post Office

Stone &

Square.

It is expected that the current
quarterly rate of 50 cents

share will be maintained

effect, give shareholders

With Lee

Higginson

A

(Special to The Financial Chronicle)

BOSTON,

Mass.

Harding ' has jointed
Lee

Higginson

Federal

.

John

—

the

are

L.

staff of

Corporation,

50

Street.

on

an

the increased

levels with the aid of
ume.

While there

~

year

higher interest rates and

are

some

banks
a

which

desire

to have stockholders share in the

„

in

on

need

will reach record
a

rising loan vol¬

to

increase their

the part of bank directors

improved earnings.

Among the New York banks still expected to increase cash

(Special to The Financial Chronicle)

BOSTON, Mass.

—

Robert J.

Dunkle, III has become affiliated
with Stone &

Webster Securities

Corporation, 49 Federal Street.

payments or declared stock dividends in the immediate future
the following.
The

and

INSURANCE
STOCKS

are

'

Guaranty Trust meeting the first week in December is

expected to pay an extra dividend to bring payments in 1953 above
the $15.00

BANK

at

distributed in 1952.

Manufacturers Trust, also meeting next week, may pay a small
stock dividend

as

it did in 1950 and

1949.

Empire Trust has paid

stock dividends in each of the
past two years and may take such
action

again in January.

Bank of Manhattan

and

Bank of New York

are

we

also meeting

the

Members New Tork Stock Exchange

Members New
120

payments.

York Corb Exchange

BROADWAY, NEW YORK 5, N. Y.
Telephone: BArclay 7-3500
Bell

for dividends within the next two weeks and could
enlarge

Teletype—NY 1-1248-49

their

The Hanover Bank generally meets the first week in

December and from

the action of the stock

favorable to shareholders is indicated.

recently, some action
-

'«

Specialists in Bank Stocks




come

rates

and

with

returns

high

whole,

we

would expect more of the larger banks to

increase dividends in the coming weeks.

from

46%

U>

taxmg and

been very evident to me

was

1927,

1928 and 1929, under the
rates, were greater th&Rt
the total for 1924, when higher
rates prevailed. These reductions*
also coupled with increased
exemptions. Moreover, during
that period the corporate income

were

as

tax

tax

at

was

a

flat rate

of

10%.

How can lower tax rates yieM
higher tax returns? The answer,
of

in

lies

course,

these

lower

rates

the

that

fact

stimulate pro-

can expect no substantial

would

expense

benefit

a
„

Effect of

the rich

a

25%

Ceiling

on

Income Tax

of the poor over-

It

Taxes Influence Investment

has

Federal

been

estimated

that

At

Can

revenue

the

by $6%

billioau

government

get along
without that $6!4 billion?
Well,
the Hoover Commission states that
^sonal taxes are high, few people from $3 to $4 billion could be
want to risk investing in new in- saved by
government reorganizedustries, new businesses, new pro- tion alone. Senator Byrd has made
duction, new employment or new public a report showing how 1ft
"sales, because if these investments billion could be saved by elimi- '
do pay off, Uncle Sam will take
nating non-essential expenditures,
^the lion's share of the income. As And Senator Douglas once outa result of
present-day high taxes, lined nine specific ways to cut
money
flows
into
government $4% billion from the budget withbonds, where there is no risk, or out interfering with any essential
into high-grade bonds or the sea- services.
;
>"
;
7
•
/

soned securities of the very big
corporations, where there is very
little risk, or into speculative se-

curities for

a

fast capital gam.

1

And

so,

as

you

can

see

and am

au

know, the government caA
get along with a lot less taxes and

we

a

i0t

iess

spending.

However,

Meanwhile, small and mediumsized businesses, seeking a chance
to expand, to employ more people,

no

they"^ cannot3 attract' S ^

a constitutional limit on Feder*

of

taxes

the tax

laws.

And with

where

there

way.

vinced

is

will,
That is why I

that

the

no

only

there
am

la

cow-

remedy

spending and taxing—a limit

is

axi

high, these isn't much spending that will prevent further
of their own profits they
c^n re^; deficit
financing, and a limit or
so

tain lor expansion purposes.

These

overlook

same

complamers

the fact

that

most

♦An

will"

MJtoes that

preserve economic
7017,7^
uw

also
cor-

*
.

On the

reduced

was

reduced

as

°f,nfiiplTvinH

powers.

1926 the maxi-

rate of tax on individual in¬

25%, and in 1929, it

with

corporate

as

in

wrecked?5

be

pure nonsense,

further
10%!, reduced to 24%. Yet taxes
paid by
ridi- individuals for each of the yeats

Most economists knowfthat high
personal taxes influence the direction of investment. When per-

.

(L. A. Glbbs, Manager Trading Dept.)

today,

example,

mum

such

look the chief purpose of the lim-

cause

Laird, Bissell & Meeds

began to

itation—namely, to restore incen- tax ceiling of 25%, plus the scaJtives to earn, invest and
produce, ing down of all other income taxe*
in proportion, would d e c r e a s e

throughout the country

Earnings of most banking institutions this

For

Con-

Those who complain that such

increase in the cash payment.

number of the other major banks

nf

limitation
a

expected to take favorable dividend action in the coming weeks

capital accounts, there is also

With Stone & Webster

shares which will,

the
constitun
on
income

a

duction, the only possible source?
tax and spending relief from
a
of an taxes.
They permit more
Congress ?, that is under constant
money to be used in producing
political pressure to spend for this
goods and services, in investment,
and spend for that. The only
prac- in
expansion
of
jobs,
and
m
tical solution, I am
convinced, is greater sales. They produce, font
to impose upon this Congress a
other words, greater yield than &
constitutional
limitation
on
the
higher tax on fewer people inextent to which it can tax and
vesting their money in
high-grade^,
spend.
bonds and tax-exempt securities "'

On Sept. 24 the Bank raised

have become affiliated with

and

has

that

1952, it has announced that subject to stock¬
holders' approval at the annual
meeting to be held Jan. 13, 1953,
a stock dividend of one additional share
for each 24 held will be

BOSTON,
Cook

being

of

income tax returns

tax

spending

While the National City Bank of New York did not increase

(Special to The Financial Chronicle)

Well,

88%

as

fai! ?

share to 50 cents. In addition

a

when

ago,

place
of
25%

Actually, "this is

70%, we have learned—the hard
way—how well founded were the

share.

share declared in 1951 including an extra of 20 cents.

Street, members of the New York

was

members

happen!

individual

The Chase National Bank is another of the New York banks

du

Exchanges.

a

to

a

ever

raised from 20 cents to 25

that payments this
year totaled $1.10

with $1.00

Pont, Homsey & Company 31 Milk
and Boston Stock

extra of 10 cents

an

was

in relation

year

Government would

amend-

was silly to think that
preposterous thing could

such

rate, the action is viewed

dividend is still conservative

February the quarterly rate

cents

(Special to The Financial Chronicle)

increase

an

tax

culed. .It

generous

a

,

extra

income

some

income

annual

some

C. R. Sheaffer

pointed out that, under
an
amendment, the tax
might even go as high as
These people were
actually

to

an

Prices

attract public at¬
tention, the Secretary of the
Treasury and other members «*fi
the Washington Family immedi¬
ately issued a warning that if such
a
limitation were
imposed, the

,

gress

On Nov.

to Lower

to

limit

taxes

ment to the constitution

George L. ; Austin,. G. L.
Co., Hartford, Connecti¬
cut; William L. Canady, W. L.
Canady & Co., New York City,

While

tional

the
t

a

movement

how boundless such powers tan be.

Company of New York is another institution

cents, indicating

About

has

n

Lead

which, incidentally has dramatically demonstrated in recent years "fiscal foundation of the
Federal,

present

quarterly dividend, payable Jan. 15, 1953,
55

Anyone
business

a

a

den tax burden.

Gov-,

m e

City;

..

is

powers

increase in the cash payment of 33%%.

was

to

wealth.

mittee, replacing Harry R. Amott,
Amott, Baker & Co., New York

previously paid.

are

ceiling on Federal income
taxes
would, therefore, lead to
lower prices and would greatly
decrease the average family's hid¬

taxing and
spending

rate, after the 100% stock divi¬

which has recently increased its cash
payment.

Austin &

the

A

powers

boundless

After the stock dividend is dis¬

$12.00 annual dividend rate.

a

Would

t h eir

g

ment

important decla¬

tributed, it is expected the directors will place the increased stock
on

re¬

fact, in our
country
the
only
govern¬

increased

meeting to be held Dec. 22,

will be paid.

prices.

operated

ever

ate

in

part of the
doing business and as such
a
part of the price at
which the goods are sold.

oper¬

under

n

local

The Northern Trust
Company has announced that subject to
stockholders' approval at a
dividend of 100%

higher

who has

levies

tax

consumers

knows that taxes

In

have announced

Some of the

to

on

of

become

it i

increasing the stockholders' return.

throughout the country which

income

porate
handed
form

strictions lim-

Over the past two months there have been several
of the larger
banks

than

more

resources.

cost of

ate

the declaration of

increasing the annual

likely to be paid in

are

of

states limit the tax-

our

charter,

taxing

Also, stock dividends
as

constitutions

third of

be greatly ""

investment would

new

expanded, thus increasing tax

governments,
by
law
or

expected to

are

ceiling, business and

ing power, and all but five states
limit the right to borrow. All local

year-

dividend rate.

the District No. 13 Com¬

on

or

The

the

Bank dividends should follow these
general trends but there

District No. 13 to replace Charles
P. Cooley, Cooley & Co., Hartford,

Connecticut, and W. Fenton John¬
ston, Smith, Barney & Co., New
York City, whose terms of office

for

pen

cannot be

stimulated and

not match those of 1951.

may

will be few reductions.

Gov¬

Association

the

of

ernors

of

the

of

be maintained

although in certain individual instances extras

end payments

Roy

Taxation

on

By CRAIG R. SHEAFFER*

Securities

of

»

(2037)

NASD District 13
At

rfrmrrrrrrTsryayj T^/ttagacsBaw

address by Mr. Sheaffer before
the
Iowa
Taxpayers
Association,
Deo
Moines, Iowa, Nov. 14, 1952.
;

„

incentives,
base,

assure

and

fiscation
.,

minority.

prevent
the

of
:

t

a

broad

further

property

of

ta*
con-

the

Financial Chronicle

The Commercial and

lime

same

Banking

the

by

Subject to approval by
of the proposed
increase in the number of shares

dividend.

De¬

had

News About Banks

made

sion

to

application for permis¬
a branch at Mount

board

Genesee

National

River

with

Morris

Mount

Bank,

the

at

Approval of the merger of the
Lieutenant Com¬
Amsterdam City National Bank of
"The
Amsterdam, N. Y. (capital $200,Dime" in 1931 as a clerk in the
visory Board of Chemical Bank &
On Aug. 000) with the Manufacturers Na¬
Trust Company's Rockefeller Cen- Mortgage Department.
tional Bank of Troy, N. Y. (capital
15,
1941 he was appointed an
is announced in the
Assistant Mortgage Officer and in $1,500,000)
Nov. 10 Bulletin of the Office of
December 1945,' Assistant Secre¬
the Comptroller of the Currency.
tary in charge of the Mortgage
The merger was effected on Oct.
Servicing
Department. In June
31 under the title of the Manufac¬
1946, he was appointed an Assist¬
turers National, which at the date
ant
Vice-President.
Mr. Peffert
Watson

K.

A.

and Robert W.
elected to the Ad¬

Sites entered

Mr.

"The Dime"
in the Bond and

entered the service of
in 1932 as a clerk

June

In

Department.

Mortgage

1946, he was appointed Assistant
Comptroller
in
charge of the
bank's Accounting and Bookkeep¬

veteran of
Mr. Peffert served

World War II,
in
3

K. Watson

A.

Robert

White

W.

A

Department.

ing

Pacific and in China

the

a

The

ter

Office,

New

it

York,
25

Nov.

51st'Street,

West

11

was

announced

announcement

An

on

20,

Nov.

on

by the Lee Higginson Corporation
states that all of the 10,000 shares

Vice-President and General Man¬

of

ager

of IBM Trade Corp., is a di¬
rector of IBM United Kingdom,

Bank

Ltd., American Eagle Fire Insur¬
ance
Co.
and
National
Foreign

scribed for at $54 per

Trade Council.

He also is

a mem¬

ber of American Arbitration Asso¬

ciation.

Mr.

Meadow Brook National
of Freeport, Long Island,

The

each)

(par $20

Y.,

N.

sub¬

were

share. The

noted, were offered
in connection with the consolida¬
tion of The Meadow Brook Na¬
is

it

shares,

are

the Amsterdam
operated
as
a

of

now

branch of the Manufacturers

Na¬

tional.
*

tt

*

Hammond, President

Baxter Jackson,
Chairman. Mr. Watson, a director,
N.

by

quarters

Bank

Harry K. Cornelius and Leo V.
*

:h

capital stock

a

$1,500,000 in 60,000 shares of
common stock, par $25 each, sur¬
plus of $1,500,000 and undivided
profits of not less than $1,000,000.

States Marine Corps.
#

had

and Execu¬

Vice-President

tive

respectively

of the North Jersey National Bank
of

Pompton

Lakes,

the

by

J.,

N.

jointly announced that

stockholders

the

the

of

North

Jersey National Bank to purchase
the assets and assume the deposit
liabilities
mitted

the

of

in

latter

letters

sub¬

was

the

to

share¬

Robert tional Bank of Freeport and Peo¬
holders.
Assuming that the pro¬
White Associates,
business con¬
ples National Bank of Lynbrook, posal is accepted at a special meet¬
sultants, is a director of the Amer¬
Long Island. Reference to the con¬ ing of the North Jersey National
ican Locomotive Co., Corn Prod¬
solidation appeared in our Nov. Bank shareholders to be called on
ucts Refining Co. and other com¬
Dec. 11, the shareholders of the
20, issue page 1933.
panies.
*
*
bank will receive the liquidating
•f
si:
*
Horace C.

White,

of

New
ence

York,

announces

Buechner

' A.

that

has

Manufacturers
1941

he

in

Trust

appointed

was

ant Secretary.

Bank first became a member bank

a

Mr. Buechner is in
He is

bank

the Club, bringing the total
membership to 42. Each of the
new members received a gold pin
and a $50 savings bond. The Club's
record is held by Otto Strippel,
trustee, Vice-President and Treas¬
urer of the bank, with more than
48 years of service.
Other mem¬

paid

the following, who are also trus¬
tees of the bank: Robert A. Drys-

*

had

following
new official appointments: Gustav
T.
Andren, Everett J. Livesey,
Thomas S. Sites, as Vice-Presi¬
dents; and Gerald J. Peffert as
Comptroller. Mr. Andren entered
"The Dime's" employ in 1932 as a
Real Estate Appraiser.
In June
1939 he was appointed Assistant

Mortgage
Mortgage
1947

Mr.

an

in

Officer

and

Assistant

Livesey

career

hurst
and

Officer;

at

Branch

transferred
and

has

his

banking
Benson-

in

was

1946

April

Dime's"

1930

Five

fice

in

Vice-President.

started

"The

teller.

June

as

years

to

the

served

as

a

Main

Of¬

ing

'

The

in

of

Bank

of

Trust

&

Paterson, stated that,

upon

Total deposits

amounted to $7,729,782.
National

Bank

all

of

United

States

State

10

Banking

the State Bank of Albany has filed

application

occupy

Montgomery
action

by the

permission

for

branch

a

to

Amsterdam,

at

of

Warfield,

Jr.,

of

son

Governor Edwin Warfield

Maryland, died

Baltimore.

He

on

was

19

at

years

of

Nov.

61

Mr. Warfield, Jr. had been

identified with both

Department has made known that
an

Edwin
former

age.

Washington.

York

New

dur¬

publishing
served

Chairman

as

of the

Tide¬

Fisheries Commission from

water

until

1941

banking and
interests,
and
had

1947,

likewise

and

Chairman of the Board of Natural

taken in connection with the pro¬

been

posed merger of the Farmers Na¬

the

tional

a
director of the Fidelity & De¬
posit Co. of Baltimore and the
Savings Bank of Baltimore.

Bank

of

with

Amsterdam

*

Approval
Nov.

5

by

Banking

000.

New

York

Department
Trust

from

The

each.

the

*

announced
of

in the capital stock

Security
Y.,

*

was

It

of

in¬

is in shares

made

known

and

"Daily Record."

X

At
the

a

publisher
He

also

Nov.

on

directors

of

of

of $25
at

the

cago

stock

from

proposed
of

the

that

bank

$3,000,000

the
be

to

through the payment

The

12

by

Chairman

Calkins,

directors

new

of
are

Harry Camp and
Carr. Mr. Bain

Bain,

Herbert

the

of

President

and

Company
board

Francisco

Nov.

on

He

directors.

of

the

of

director

Leslie

member

a

Salt

its

of

is

also

Schilling

a

Estate

director

a

also

Minneapolis,

Executive

Committee

of

the

past national President and

director-at-large
Institute

Controllers'

cur¬

of

of

the

America.

William J. Raber Now

election of directors

With Hooker &

18, Roger B. Shepard,
announced. Both men
serve
three-year terms be¬

will

is

company,

Alaska Packers Association, He Is

Nov.

on

that

of

director and member of the

a

Chairman,

ginning Jan.

Mr. Clark,

1953.

1,

Fay

Chairman of the
of West Publishing Co., St.

who is Honorary
Board

Paul,

elected

was

class B member
represent¬

a

of the nine-man board,

ing commerce, industry, and agri¬
culture. Mr. Zelle, Chairman of the
Board of tire First ^National Bank
Minneapolis, was^'elected a class

of

merffber. Mr Clark

A, or banker,
has been

director of the Reserve

a

since Jan.

Bank

1,^941, and

Dec.

^r. Zelle had
1|, 1952, to fill

1936.

31,

pre¬

1, 1922,

viously served from" Jan.
elected Jan.

unexpired term,„:

an

William

J.

Raber

(Special to The Financial Chronicle).

election' of

the

In

Federal

the

19,
The

capital

increased

$6,000,000
of a stock

Reserve

which

Louis,

ended

directors
Bank

of

Nov.

18,

of

Etherton, President
bondale National Bank,
E.

of
St.

J.

Car-

Carbon-

dale, 111., was re-elected by mem¬
banks in Group Three as a

ber

A

Class

director,

E.

Grocer

Jarrell

Ark.,

Ralph

and

President of PlunkettCo., Little Rock,

Plunkett,

by member
as a Class B
according to announce¬

SAN FRANCISCO,

liam

Raber

J.

with

ciated

Pine

has

Calif.—Wil¬

become

&

Hooker

asso¬

340

Fay,

Street, members of the New

York

Francisco

San

and

Stock

Exchanges. Mr. Raber was for¬
merly in the trading department
of Stewart, Eubanks, Meyerson &
York and its predecessor, Stewart,
Scanlon & Co.

re-elected
Two

was

banks in Group

director,

Russell

of

ment

L.

Walter

Dearmont,

Jan.

three

of

term

a

Each

Bank.

serve

*

?

The promotion
Jr.

oFY. J. Johnson,
the position of Vice-Presi¬

to

J

dent,

for* the

a p a n,

National

America

Bank

Trust

of

Sav¬

&

ings Association of tSan Francisco
announced

G.

sell

Smith,

recently by Rus¬

Executive

60

State

Manager'

and

America's

Tokyo
is

He

1947°.

of

Bank

branch

was

an

nolly

C.

of

since

being*'succeeded

Ryan^r.,

as

lier

this

the

new

as

has

the

New

will

son

now

Vice-President
the

bank

office will
bank

Tok|b quarters to
Building,

Nov^21. Mr. John¬
serye

as

Nov.

17.

*

WORCESTER, MASS.
F.

staff

of

;

-

Joins Courts Staff

His

(Special to The Financial

in

Osaka

DURHAM,

iq Japan, others

Council is

in

Yokohama and

Ill

located

Justin

Street.

it's fourth branch

being

—

been added to the
Gibbs & Co., 407 Main

Deedy has

resident

Japan.

opened

following

Gibbs & Co. Add

remain.s|n Tokyo. The

recently

the

(Special to The Financial Chronicle)

andjvill represent

throughout

Stock Exchange

announced

Vincent Hale retired from part¬

ear¬
Announcement of
was made

Marunoychi
for

Con¬

of Walter J.

change:

appointments

America's

officer

& Co., Inc.

Weekly Firm Changes

prelude to transferral of Bank

of

Stock Ex¬

was

The New York

AssistanQHanager
year.

He

banker nership in Sterling, Grace & Co.

a

years' ^experience in
the Far East who was assigned to
many

Tokyo as

Boston

New York Stock Exchange

Manager of the Tokyo branch by
with

and

recently with
Goodbody & Co., and prior thereto
changes.

Mr. Johnson has been Vice-Presi¬
dent

members of the

Street,

York

New

activities.

banking

Jr.

Vice-

President, in chargfe" of the bank's
international

Walter J.

—

has become associ¬
ated with H. C. Wainwright & Co.,
Connolly,

*

Mass.

BOSTON,

beginning

1953.

1,

(Special to The Financial Chronicle)

chosen for

was

years

Connolly, Jr., Now

With H. C. Wainwright

Chairman of the Board of the Re¬

scheduled

*4*

meeting held

board

was

of

of the Northern Trust Company of Chi¬

Rochester

$2,600,000 to $2,860,-

stock
was

Co.

President

on

State

an

eral Reserve Bank of
at the annual

William
as

County, N. Y., the Resources. According to the Bal¬
bank having been timore "Sun" since 1920 he had

the State Bank of Albany.

Edgar F. Zelle, Minneapolis, were,
re-elected to the Board of the Fed¬

was

States.

Paul, and

Clark, St.

P.

The First

maintains

now

B.

rently

the

Jersey National will

respect ively.

A.

William
is

San

of

announced

the Board.
Fred

California

Co.

shareholders' approval of the pro¬

11th

in business

the

George

except

N.




increased

administration

the

Presidents

Vice-President

Mr. Livesey served in the United
States Navy during World War II

be

McDonald

Mr.
first

continued

crease

Comptroller.

will

and

the United

bank

Auditor, Assistant Secretary, Assistant Comptroller, Assistant
and

2.

It has

he

Assistant

National

Board

the

Albany

in Albany, and the

clerk

later

First
of

Raymond Peter¬

of

was

Allard

a

*

*

*

been

F.

Chairman

son,

Bank

I

Homer

shareholders.

be welcomed into First National's

2,

this

oldest

21

the

made

Dec.

dend.

to

Re¬ made clear that officers and staff

*

Bank-of

that

bank

est

that the Board of Trustees of "The

Dime"

recommend¬

are

offices
in Paterson and Clifton,
payable on the first N. J. Its resources
are in excess
business day of 1953, coincides with
of $195,000,000, with capital funds
the
beginning of State
Bank's of
approximately $13,000,000.
150th year. State Bank is the old¬
*
*

W.

Nov.

National

quarterly dividend of $3 a share
the
60,000 shares of capital
stock to be outstanding upon the
consummation of the stock divi¬
on

ing favorable action by the bank's

dividend

George C. Johnson, President of
The Dime Savings Bank of Brook¬
on

Jersey

McDonald,

Jan.

on

stated

Lafrentz and Louis Watj en.

lyn, N. Y., announced

been

and directors of the North

of the North
*

State

business

of

bers with long service records are

*

the

of

to

F.

notices^ have

legal

,

published and other legal require¬
ments completed.
Messrs. Corne¬

President banking family and will continue
at to handle the banking business of
Albany, N. Y., announced that at the Pompton Lakes institution. As
a
meeting on Nov. 18, the board of Sept. 5, 1952, the North Jersey
had
capital
funds
of
of directors voted to increase the National
regular quarterly dividend on the $275,754. These were made up of
capital stock from 25 cents to 30 capital stock of $100,000, repre¬
sented by 10,000 shares, par $10
cents a share. The first increased
dividend will be payable to stock¬ per share; surplus and undivided
holders of record as of the close profits were $125,000 and $50,754,
Frederick

Lee, President of the
bank, welcomed 11 new members

*

System.
*

T.

Henningson,

the mini¬

Federal

the

rejoin

annual dinner

Nov. 19 at Luchow's Restaurant.

dale, ,Eugene

to

serve

Quarter Century Club of
the Central Savings Bank of New

James

as

ef¬

requirement
for
posal, the First National will con¬
member banks operating out-of- tinue the
operation of the Pomptown branches, thus enabling the ton
Lakes
institution.
He
also

The

on

cash

in

capital

mum

jjs

York held its fifth

out-of-town

an

revise

amended to

was

in

15, 1952, the law

branch. On July

sity, class of 1926.
sj:

It withdrew from

Aug. 10, 1951,

on

establish

order to

graduate of New York Univer¬

t'f

Dec. 30, 1943.

on

membership

charge of the Foreign Department
at the Fifth Avenue Office.

shares

lius and Hammond stated that the

Assist¬

an

Allan

by

20,

Nov.

on

System,

Reserve

their

the transfer ]bas been

as

Sproul, President of the Federal
officers
Reserve Bank of New York. The

In

1923.

made

was

an

Federal

the

of

soon

of

member fected,

Park, N. Y., has become a

ap¬

Assistant Vice-Presi¬
dent of the Trust Company.
Mr.
Buechner
joined the
Columbia
Bank in 1919 which merged with

pointed

at New Hyde

of New Hyde Park,

Clar¬

been

Bank

the

that

Announcement

Flanigan, President of
Trust Coirijpany of

Manufacturers

value

National

board of

Anglo

of the

Consummation of this Company, Pacific Lighting Corp.,
is dependent upon the the James Dole Engineering Co.,
authorization by the stockholders and other corporations. Mr. Camp,
of an additional 30,000 shares of President of the Cary Camp Mil¬
capital stock. The boar#l has called linery Co., has spent his business
a special meeting
of stockholders life in the millinery field, with
the exception of the World War
to be held on Dec. 22, to vote upon
this increase in capital stock., A
II period when he served as Ad¬
meeting of the board will be held ministrative Assistant to Donald
on Dec. 22, after the stockholders'
Nelson in Washington and later
meeting. It is anticipated that if returned to the Pacific Coast to
the stockholders approve the in¬
establish price controls. Mr. Carr,
crease in capital stock, the board
Vice-President and Treasurer of
at
this
meeting will declare a the California Packing
Corp., and

&

Trust Company of Paterson, N. J.,

to

sup¬

directors

it

■,

businessmen

added to the

been

have

*

■*

*

California

Three

proposal

have

Bank

be

number

a

000,000.

proposal

a

National

First

will

dividend

500,000 from reserves. Upon com¬
pletion of the stock dividend trans¬
action, the capital stock of the
bank
will
amount to $6,000,000
and surplus will remain at $14,-

of

United

the

in

Officer

Warrant

as

of the merger

stock

Capital funds for

plied by the transfer of $1,500,000
from undivided profits and $1,-

with the rank of
mander.

on

this

tjc

ft

payable to stockhold¬

Dec. 22.

ness
#

each

for

operates

military facilities to serve the
U. S. Armed forces in Japan.

the

stock,

stock

capital

also

It

Kobe.
of

time declared

of record at the close of busi¬

ers

Trust.

White have been

of

share held,

Security

capital

same

stock dividend of one additional

this, it is indicated, being incident
share
the
proposed merger of the

CAPITALIZATIONS

the

at

to

Bankers

and

REVISED

bank's

the

of

open

Morris, Livingston County, N. Y.,

a

CONSOLIDATIONS
NEW BRANCHES
NEW OFFICERS, ETC.

stockholders

the

partment that the trust company

'•

Thursday, November 27,1952

,..

(2038)

26

now

Corcoran

Chronicle)

N. C. — Vera B.
with Courts & Co.,

Street.

Volume 176

Number 5172

•

:

The Commercial and. Financial Chronicle

..

27

(2039)

pand their exports.

and the

be

It remains to

whether the British Gov¬

seen

ernment

the

and

Commonwealth

..Governments will be prepared to
assume

no

let-up in

dian

investment.

It

recently

was

reported from Spokane, Wash., by
the Associated Press that Ameri¬

interests

can'

5%

chain of Canadian

a

power

plants to provide
States.

steam

power

for

The project,

it

is said,

will use low-cost coal of
Southwestern
Alberta
and
will

electricity into the north¬
power pool to Hungry Horse

and

Libby, Mont. The cost of the
project, to be built over 40 years,
estimated at $1,800,000,000.

was

The

Spokane "Spokesman
the

details

says

of

source

the

revealed

were

Re¬

report,
by O.

R.

% *-T.

rent

the

of New

Canadian

ent

Governement

to

up

that

10,000,000

kilowatt

streams and huge coal de¬
posits. 100 units in all are planned,

many

and

of

they will be built at the rate
two

three

or

Angelillo

told

•'It is my

per

the

tual

Mr.

year.

newspaper:

understanding

to be able to start work

plants by March

in

high level of both foreign and

investment, and the

ex¬

isting
framework
of
incentive
policies have sharply stimulated
Canadian

economic

expansion.

efforts

.are

to

some

tap

new

already
of

the

discov¬

resources

in the past few

ered

while

years,

tensifying efforts to develop min¬
eral
deposits
already
known,
particularly those which until re¬
cently were regarded either-, as
uneconomical

accessible.'

ought of these

we
on

(especially

hours high raw materials prices are in¬

could be generated, using Alberta's

the

ac¬

April."

to

resources

Canada's

en

work

Increased

or

'in¬

as

exploitation

should strength¬

international

eco¬

nomic

position not only by ex¬
panding exports now in heavy
strip of land 35 miles wide demand abroad, but also by help¬
and 125 miles long along the Al¬ ing to meet Canadian demands for
berta-British Columbia boundary. items that now must be imported.
•

or

Points

^

-

.

a

The

main

promoters

cannot

be

disclosed

until

financing

plete,

said.

However, he said

La

he

is

com¬

Buscadera

Exploration Co. of
Pasadena, Calif., will have a part

The main fields of present and
prospective Canadian development
in

are

oil

nonferrous

ore,

electric

in it.

natural

and

iron

gas,

metals,

hydro¬

and uranium.

power,

"In the last five years, extensive

The

Spokane

tions

newspaper

official

an

of

the

men¬

Alberta

Industrial

exploratory and developmental
tivities

in

western

Development Board as
confirming that California inter¬
ests planned to build one or more

already led to

steam

creased

generating plants to export
power
to
the
United

electric

States.

•

,

.

s

*

.

in

Canada's

Canadian

a

from

ac¬

have

Canada

thirtyfold increase
oil

proven

oil

reserves.

production

has

barrels

21,000

in¬
per

day in
1947
(8% of Canadian
needs) to 132,000 in 1951 (almost

*

-

out iailure to maintain

LONDON, Eng.—In his speech

one-third
of
the
much
larger
needs
in
that
Another
item
of
investment Canadian
year).
significance is the increasing in¬ Extensive oil pipeline facilities
terest of American security deal¬ have been completed and more are

Nov.

on

11, the British
by im-

that,

the question of

the

be

on

•'J#-."'

agenda Of

the

had

Al¬

been

the

PS'.-*-

this

sumed

as¬

to

be

Government

for

case

some

the

the

time this

was

which

it

Dr. Paul

was

Einzig

°f

-1

-

T

—

-1

appointed

now

the

investigate

possibilities

making sterling convertible.
report

matter

tude

submitted

of

Canadian

in

investment

under way.

In addition, proposals

panies.

have

made

funds have been

portation of low cost natural gas

com¬

In its

return to

a

Already three mutual
organized in the
United
States that are offering
their shares to the American pub¬
lic.

ment

enterprises

Canada. It

that
can

other

Several

similar

going

are

announced

was

invest¬

into

recently

prominent Canadian, Ameri¬
and

European

formed

a

known

as.

new

interests have
to

company,

be

Canadera,

Ltd., whose
Capital is to be applied to the
development of natural resources
industries

of

been

from

Alberta

Canada

and

for

the

both

to

trans¬

eastern

Vancouver.

These

recent

and

improving

Canada's balance-ofposition vis-a-vis the

payments
United
^

prospective effects in

States.

"Finally,

government

policies

have fostered

rapid economic de¬
velopment in Canada. During the

Canada.

Initial past two years, of course, when
is reported defense requirements and infla¬
to be $1 million. The shares are to tionary
pressures
have
placed
remain privately owned, however; critical strains upon the economy,
and no public offering is antici¬ official policies have attempted to
channel the continuing expansion
pated.
" ' '
1 Participants in the new venture in industrial and primary produc¬
and

capital of the

company

was

on

ground

is

agreement
In the

well

mercy

reached

an

of this

regarded

as

being complete

un-

til conditions had been created in
which

sterling could become and

remain

convertible.

He said

that

the Government intended to work
to create such

pressed

the

m on wealth

share

hope

that

the

ex-

Com-

Prime Ministers would

this

the

conditions and

view.

Beyond

Commonwealth

doubt

Conference

happens to coincide with

favor-

a

able change in the immediate sit-

Credit

York;

Suisse,
Zurich;
Canada, Ltd., Toronto;
de l'Indo Chine, Paris;

tion into 'more essential' lines. But
many

Whitehall

Banque

zons

Ford,

Bacon

Newmont

Calder,

.

&

Davis,

Inc., and
Mining Corp. Curtis E.

Chairman

Bond & Share

bers
In

are

among

the

mem¬

of the board.
Canada

a

ties house of the
tificates
which is
company

years ago

of

an
offering is
Montreal securi¬

voting trust

Company,
an open-end investment
organized
about
two

and financed mainly in

Switzerland, Belguim and Holland.
This

concern

Canadian

ing

invests mainly in
stocks furnish¬

common

regular

income

and/or

invest

in

more

unlisted

is

Pierce,

Wilcox

Fenner

over

of

not
a

possibly

few months

In the meantime ster-

became

firmer,

payments

influx

the

balance

improved
increased.

&

Beane,

to

be

B.

C,: Ziegler

and

Com¬

251 Nofth Main Street.

in his

ISLAND, 111.—Harlan B.
rejoined the

Bond

Rock Island Bank

&

staff

Shares

Building.

always

high

tempting

whatever

be

proceeding

moment

of

Co.,

trend

would

decide

at

a

con-

to plunge into con-

vertibility at short notice.

(Special to Trie Financial Chronicle)

has

is

to

slightly

that the

of

before

tate

plunge.

It

is

mendous

through
other

clear

to

$1,556,000.

that

improvement

the

tre¬

and

con¬

retained

preciation,
that

the

from

etc.

It

through

de¬

obvious

seems

necessity for borrowing

banks

principally

has

been

which

around

occasioned

finance

to

inventories
from

substantially
earnings plus

retained

cash

increased

have

grown

$887,000 at the end

of June,

1947, to $3,984,000 at the
June, 1952.
reiterate, I believe that this

end of
To

stock

represents an
exceptional
opportunity to participate in one
of our country's real
growth in¬
dustries.

with

Never-

F. P.

decision

C.B.E.,

elected

Fund, Inc.

the

remem-

tual

F.

Q.C.

director

a

deciding to

take

Brais Director

Honorable

Ltd., two

it

re¬

com¬

struction program of the
company
has
been
financed

ment

1925

as

the

increase of $4,-

an

amounted

quite

Mr. Churchill to hesi-

in

books of

showed

struction

decision

Many people still

that

ber

the

plant,

gross

the

Philippe
has

of

been

Canadian

Canadian

and

Invest¬

Fund,
mu¬

invest¬

ment

com¬

he, as
under
Chancellor of the Exchequer, who panies
Bul¬
returned to the gold standard at Calvin
the pre-1914 parity of sterling, lock manage¬
ment.
Hugh
only to regret it forever after. It
is this consideration which lends Bullock,
credence

to

the

was

publicized

story

by Mr. Gaitskell in his speech,

ac-

cording to which

ago

the

some

months

Cabinet had

actually decided
in favor of convertibility, but the
decision

was

vetoed

In

any

the Prime Minister does not
as

both

optimistic

o

f

com¬

panies,
the

made

announce¬

ment.
Mr. Brais is

second

on

thoughts by Mr. Churchill.
ito be nearly

President

senior partner
of

the

real

Mont¬

law

F.

Philippe

Brais

firm

of Brais,

Campbell & de Grandpre,
balance
of' payments
and President of General Theatres
the Chancellor of the
(Quebec) Ltd. He is a director of
Exchequer.
Canadian Pacific Railway Com¬
There is indeed room for more
about

the

position

as

opinion about the chances pany, Sun Life Assurance Com¬
present improving trend pany of Canada, Montreal Trust
would continue.
Any decision in Company, Quebec Airways, Ltd.,
and other companies.
favor of convertibility must necthan

one

that the

essarily

rest on the assumption
the next few months

that during

the British gold reserve would in-

With Waddell & Reed
(Special to The Financial Chronicle)

considerably as a result of
TOCCOA, Ga. — Jess A. Hayes
tinue, if not forever, at least for the surplus on the balance of payis now
affiliated
with Waddell
a
long time.
Even allowing for ments. There appears to be very
& Reed, Inc.
this, it seems unlikely that the little justification for such optiCommonwealth
Prime Ministers mism. It is true, enthusiastic supwould

Rejoins Standard Bond
ROCK

oneself

very

connection

fear

cause

appear

that

to

particular

BEND, Wis. — James I.
Fitzgerald has been added to the
of

It

run.

assume

happens

WEST

staff

a

in

convertibility.

consequences

might

case,

characteristics

for any
that would

would be blamed for any adverse

at-

degree by the immediate situation

to

Ziegler Co.

to

964,000 plus, and as of June 30,
1952, plant and equipment in con¬

The
might be unpopular in the country
and
that
the
Government Brais,

the

to allow
to

the

be

necessary

period

pany,

doubt

majority

measures

for

return to

and

rather than by the outlook in the

(Special to "Tut Financial Chronicle)

pany,

influenced

a

The

suggestions to decide

of human nature

long

Joins 3. C.

Standard




James M.
with Merrill
—

Building.

securities

dividends and cannot invest

^now

Lynch,

Tooker

paying

ling

vorable for

(Special to xtti Financial Chronicle)

PORTLAND. Oreg.

than 10% of its assets
not

fixed.

was

for convertibility.
It is one of the

the

possibility of capital appreciation.
Like many other European invest¬
ment
trusts, the fund does not

could

mosphere would be therefore fa-

With Merrill Lynch Co.

cer¬

Canafund

This

when the date of the meeting

ago

gold

individual initiative."

Ragland

itself

being made by

phere conducive to enterprise and

Electric

of

Co., and E. S. Cald¬

well, Chairman of Ford, Bacon &

Davis, Inc.,

factors suggest that Canada

be moving toward new hori¬
in a general economic atmos¬

may

uation.

have been foreseen

and

would

the

secure

called

theless

speech, Mr.

Butler declared that the recovery
of
the Sterling Area
could not
be

be

little

be

Government

legislative

the

for

sterling

convertible

can

Parliamentary

the highest level.

on

course

there

is

prepared

Conser-

ternational monetary trend." However,

agreement
that

of

would be "at the
of the caprices of the in-

to

so

an

economy

the

been

that

present

when

moment

able

level

conver-

this

number

a

that

have

to

official

an

will

on

A

of

political

probable

seems

Conference.

Ministers

the

returning to

become

British

represented at the Commonwealth

measure

bv

would

meeting of the officials

Prime

of

It

dreaded

of the Governments which will be

.

include Lazard Freres & Co., New

increase

vatives who regard with growing
concern
the
approach
of
the

position to recommend a
date for the change. The subject
was
amongst those discussed at

various

developments are espe¬
cially important in terms of their

convertibility as a
principle, not merely

front

shared

a

understood

like

the divi¬

gated around $19 per share, or ap¬
proximately $4,750,000. During the
flected in

matter, and
their point of view is likely to be

con-

vertibility but added that it

amounted

are

Socialists

united

have expressed itself emphati-

cally in favor of

dividends

ex-

will

the

the

to

last, this cdmmittee is understood

large

further

less than $8 per share or less than

leading financial

of

tibility.

Governments concerned in March

the recent

should

I

little

a

the Socialist Party

against

Chairmanship of Sir Arthur Salter difficulties

not in

conclusion

same

because they consider the present
moment
premature.
Their atti-

the

under

that

perts in

-

1952, passed a resolution
strongly favoring an early restoration of convertibility. A commit-

to

In

a

restore

seems

in Jan.,

interim

with

Agreement

agreeable that the oppotunity has not yet arrived. But it

Commonwealth

.

to

connection
Loan

course,

Finance Ministers held in London

was

expres¬

or

the earliest

acknowledged
in public. It will be remembered

tee

gave

1932,

promising that Britain 30% of reported earnings. In other
convertibility at words, during this period earnings
opportunity. It is, of retained in the business aggre¬

1945,

would

on

in

American

of

first

occasion

analyze

Government,

'

feeling when replying dend policy of this company which
speech. Other So¬ has resulted in its strong current
cialist spokesmen too, pronounced and competitive position. In the
themselves
emphatically against five years ended June 30,1952, the
convertibility. This attitude is not company reported net income ag¬
altogether consistent with the un¬ gregating slightly in excess of $27
dertaking given by the Labor per share. In the same period total

Prime

though

out interruption since
period of 20 years.

to Mr. Butler's

.

ers

I Like Best

sion to this

Conference of
Commonwealth

Security

cialist

V:

London

Ministers.

vital

a

incalu-

2

page

sharp reaction in the British Op¬
position.
Mr.
Gaitskell,
Chan¬
cellor of the Exchequer in the So¬

convertibility:
would

an

have a large surplus; in other approximately 36. In connection
with earnings and dividends, it is
words, with the Dollar Area.
The indications of progress to- interesting to note that the com¬
wards deciding in favor of con- pany has operated profitably and
vertibility have provoked a very paid dividends in each year with¬

Chancellor of the
Exchequer, Mr.
Butler made it quite
plain

plication

from

The

Sterling convertibility following
World War I, when Churchill was Chancellor of the
Exchequer.

The power plants will be located

on

.

;

delivered

States markets), the pres¬

domestic

Ministers, Dr. Einzig calls atten¬
Party and

publica¬

strong demand for

exports

Continued

hasty action.

eco¬

York, remarks:

United

of Commonwealth Prime

tion to "opposition to
convertibility by the Socialist
the reluctance of Prime Minister Churchill to take

;

.

Review,"

"The current

abundant

from

*

on the question of restoring Sterling convertibilbe discussed at the approaching London Confer¬

a matter to

ence

tion of the Federal Reserve Bank

ect's backers had

assurances

ity,

or

speculation

Canadian

on

"Monthly

Preliminary
being made

Canadian

money

developments in the cur-.,
year, the November issue of,

Angelillo, a Los Angeles con¬
sulting engineer. He said the proj¬

the

In commenting

nomic

'

view,"

:

;v
►.*

■.

Commenting

•

of

also

company

for

resources

;

securities

borrow

to

purposes.

send its
west

its

use

in

issuer. The

not

agrees

are

nance

United

its-assets

any one

planning
to
spend almost $2,000,000,000 to fi¬

the

of

for

such

on

able prediction.

By PAUL EINZIG
There appears to be

the interest of Americans in Cana¬

responsibility

decision based

By WILLIAM J. McKAY

Indeed

speech Mr. Butler made an

crease

porters

that

the

of

convertibility

change

improvement

would
in

argue,

produce

international

important reservation by empha-

trading conditions which would go

sizing the need for coming to

a

agreement

with

countries

an

which

long way toward enabling Brit-

Two With

White, Weld

(Special to The Financial Chronicle)

CHICAGO, 111.
Baker
have

White,

and

become

Weld

&

ain and the Sterling Area to ex¬ La Salle Street.

James R.

—

Richard

M.

Sinclair

affiliated

Co.,

231

with

South

*

(

28

The Commercial and Financial Chronicle

(2040)

Continued

from

the

to

Less
the

of

re¬

of de¬

the field

off from

cut

are

material

and

human

which, for the time being,

sources

velopment in which the free na¬
tions

actively

can

objective
tional

their
interna¬

pursue

expanding

of

trade.
it

Were

the

for

not

of

spread

communism, Russian and Chinese
development would certainly be
counted upon as being among the

potential
factors
to
the
growth
of

contributing
world

in the immediate

commerce

future—and, in so doing, contrib¬
uting in the most effective way
advancement of their

the

to

standards of

own

living. Under present

they
continue, the expansion of inter¬
circumstances, and
national

trade

long

so

as

count

can

upon

little in the way of impetus
the
under-developed re¬

very

from

that

sources

locked up in com¬

are

munist hands. Our task will have
,

achieved

be

to

in

that is still open

area

the normal

reduced

the

to trade in

The communist

way.

countries will, no doubt,
to carry

continue
limited amount of

a

on

business with other countries but

their ideas of trade and of how it
be

should

handled

different from
fit to adopt a

business
but

entirely
may see

policy of doing

with

the

would

I

are

They

ours.

more

free

nations,
that, in any

think

event, so long as they hold to the
practice of keeping their foreign

and

am

ion

serious

in

are

merce

world com¬
danger of

increase

to

nations

being defeated by the advances of
communism. As I have mentioned,
trade depends basically

increased

increased production and, of
course, also upon increased mar¬
upon

kets. The free world still possesses

ample resources to provide both.
There are large new or relatively
new
areas
that are undeveloped

There

underdeveloped.

or

great older

of them

some

areas,

are

state

territorial

stantial way toward increasing the

communism

to

losses

free, but smaller, world.

our

Best

Make

Use

of

real

whole commercial

This

par¬

should

we

not

the

United

Europe,

Kingdom,

including
are

the

traditionally

great importers of foodstuffs and

has

become,

I

but it has been

some

in

or

not

is

sterling area plan
plan, but

a

Commonwealth

a

world

generally

play

can

a

full

part to the advantage of all con¬
This kind of

cerned.

chance

of

that

And

success.

is

The urgency of

moving without

delay towards the removal of
strictions

be

cannot

re¬

over-em¬

level. There

mutual

the

to

be

purpose

forts to free

couragement and co-operation of
two

confident that it is possi¬

am

ble

to

re-establish

of

forgotten that
behind the ef¬

is

to

the

make

available

producers have
can

a

chance

have

to

poli¬

predominate,

more

reasonable

a

buy where

the

lowest

prices
not

all

now

but

tries

a

is

effort

encumber

small

of

those

who

all

unrestricted

hope of

trade
of

worthy

one

of

the

number

peace

the

best

find
the

commerce

of

coun¬

in

best

page

are offered, resources are
likely to be used to the best

and prosperity for

that

measure

for the

as

accounts

in

some

existence, as well
the stubborn character, of

for

their much talked of dollar
prob¬
lem.

There

is

another

and

equally
serious effect resulting from the
commercial gulf between West¬
and

ern

Eastern

Europe.

countries that comprise the

of

omy

Western

The
econ¬

Europe

are

densely

populated and highly in¬
dustrialized. For many years

they

have been under the
necessity of
having to export in order to live,
and that
necessity presses

lines

even.

more

That

severely now
applies perhaps

9

particularly and

of

countries

to the United

are

takes

as

make tremendous mis¬
to

to

comes

timing,

the

wrong

ern

Germany,

but

it

is. true

of

several

other countries also.
On
the Far Eastern flank
Japan is in
a similar
position. The commu¬

nist territories

pier

would,:, under hap¬
conditions, have afforded

natural and

growing trade




oppor¬

come

into contact with quite a bit.

an

extremely

information

that

is

given in good faith turns out in¬

correctly and if it
source

close

to

a

comes

from

company

or

a

in

an
institution, it is often believed,
commercially.
but it is something you have to
As a group, and with few
excep¬
tions individually as well, they guard against. I believe a great
deal in what the prices on the
are very hard
up for dollars. Why
stock market tell you and if some¬
is that so?
It may be said that
one gives me very
special infor¬
the explanation is obvious—that

important

they

because

of

dollars

mation

solely

on

in

North

America,

or

their sales in other markets.

a

stock

and

the stock

doesn't go up and it keeps in sup¬

they are not earning
ply and,
dollars, either by their I

here

goes

down

begin

a

little, then

to wonder • whether
information is right.

the

The next risk is failing to see
must produce more, and
they must make their export in¬ the weakness in a balance sheet.
New that is a risk that no pro¬
dustries more competitive. Other¬
wise, they will continue to be fessional should be guilty of. Any¬
short of dollars and,- moreover* one who professes any knowledge
of securities at all ought to be able*
they WilV be open to the suspicion
of sheltering a' lot- of uncompeti¬ to, tell whether a company has
enough money to conduct its busi¬
tive industries behind their

They

,

pres¬

ent

import restrictions.

.That is

a

<

pro¬

influences

emo¬

overweighing

swayed by greed to
can

the

and

tent

certain

a

more

an

ex¬

individual

take the emotional influences

and the more they can be
objective, the better their invest¬
ment experience is going to be.
That is why sometimes a person
can
give better advice to others
than they can practice it them¬
selves because the client that they
are
advising is not hit so much
by his or her loss and so they
can really look at something and
say, "Well, this isn't good and it
ought to be sold," and if it came
to their own situation, they may
not have that ability, but it's a
very, very vital factor in reducing
your risk.
away

the

is

that

one

read

Danger

last risk I have

very

about

is

talked

about

great deal now
losing the purchasing
power of your money. In other
words, the effects of inflation. I
a

extra risk of saying
losing your money
trying to hedge against inflation
because a great many people have
around 20 and strangely enough,
bought a lot of things for no rea¬
very few people saw that the in¬
son
except that
they thought
denture was such that they had
money was going down, and that
to
maintain
a
certain
balance
is a very foolish thing to do. The
sheet position and they had to
I know of trying to
reduce the dividend for that rea¬ only way
avoid losing the purchasing power
son and the stock went down to
of your money is to try to invest
about half. Linked with that, I
your money the best possible way,
put down the failure to see a com¬
and
hope that the profits you
ing cut in dividends which means
make plus the dividends you get,
a little different than the balance
less the taxes and less the losses,
sheet item. It means failure to

might add

Here awhile ago, United Para¬
mount
Theatres
was
selling

ness

and for

expansion, etc., but

rather blunt and harsh
every; now and

then, people slip

risk

the

an

of

up.

see

decline

a

lead

may

That's

a

to

in
a

little

earnings
cut

in

more

which

dividend.
difficult

I

think than the balance sheet be¬
cause

none

of

us

know the extent

to which business will

change and
impact on companies, espe¬
cially nowdays. We all read a
great deal in the ordinary press

the

about

a

small cut in gross or total

business

working

to cut net earnings

group

short

are

enough
by

Kingdom and West¬

and

The next risk is the risk of

and

Reducing Your Investing Risks
there

Sometimes

Shortage

sterling area, for ex¬
ample. This is a very large group

than

obviously

more

Dollar

The

upset your whole

—the risk of

Maybe the word shoudn't be false.

Take the

sales

more

progress can be

made.

upon

them

along which

a

unexpected

some

"Inflation

—

factors

unex¬

Emotional Influences

here

from

where

may

Now

Continued

to buy the

gram.

all the peoples of the world.

reason¬

be obtained, and unless

consumers

trade

in

goodwill.
The
task
of
whittling away ithe restrictions

that

resources.

able chance to sell where the best

prices

non-restrictive
once

world

a

great deal of care, patience, and

trade from hamper¬

restrictions
use

en¬

you

I think you have

and not just be in

news

situation

so

allowance for

an

expansion. True, trade re¬ factual influences. That is a very
have multiplied, but I great risk. We are all human. We
believe that there is a growing are swayed by fear when stocks
going
down.
We
are
all
realization
of
the
danger
and are

a

the

make

to

to tell

back

ones

strictions

be

without

first

further

But I doubt whether the task will

undertaken

lot of "war babies" and then

a

have tried

opportunities for tional

are

couple of days after

a

maybe six months later, he would

news

what I hope will emerge.

in

Korea, he would have told you to

approach,
pected
best

an

has the

believe,

firmly

we

had gone

bigger, in buy

much

very

very

but when it
issue of the
world. Eastern Europe was nor¬ advantage. I know only too well wrong industry, most people who
are reasonably well
posted don't
mally
one
of
their
important that it is a counsel of perfection
have to make too many mistakes.
sources of supply. It is no
longer to suggest that national foreign
It's almost easy to see which com¬
^neither a large or a dependable trade policies should be based on
panies and groups are succeeding
source.
To
meet
their
essential recognition of this principle, and
and which industries have a good
needs the free nations of
Europe on nothing else. Nevertheless, I
future.
Anyone here knows for
are
now
having to rely more do not think that the peoples of
instance that electronics is an in¬
heavily upon supplies from over¬ the free world can afford to do
dustry with a great future and it's
seas sources.
They are having to anything else except work toward
just like the old story of the horse
find dollars to pay for their im- freer trade amongst themselves.
and buggy versus the automobile,
If this is so, why is there any
ports
to
an
extent
materially
so I think that's one of the minor
greater than would be the case hesitation in beginning at once
risks.
If conditions were such as to allow to clear oawiay the tangle of re¬
False Information
them to develop their trade more strictions 'that have grown up in
The next risk—believing false
freely, and more safely with East¬ recent years? The answer to this
ern Europe.
is something we
That is one of the question may help to indicate the information
materials. They draw their
requirements from all parts of the
raw

•

are

important
My message then is one of hope¬
quarters and it is certainly a most fulness on the prospects for world
trade. It is now at a very high
significant and welcome sign.

I

back

me

never

real

Unless

appreciate.

The industrial countries of

Western

in

cies will

a

attitude

know,

which

best

to

brings

must

—effects

.

not

question of trade restrictions. For

ing

fail

do

evidence

it

ticular way upon Western Europe

which

that

eral

are

have effects which bear in

uneconomic in¬

both

the

world, but they

do

old and new, and
that the sooner they can be dis¬
pensed with the better. How gen¬
dustries,

to

concern

a

defense, that

tend to encourage

enclosures

communist
of

which North America and the free

best

at

are

countries, and particu¬
larly the United States.

Available

Resources

matter

something

they

emergency

our

commerce.

Communist Enclosures

The

kind of
they

We in Canada

are

of

a

that

together.

phasized. Import restrictions im¬
posed for temporary purposes have
little more than well a way of becoming permanent.
futility of those restrictions, and
begun. There are still other areas Although
they may
have been a genuine desire amongst men of
or countries, with high industrial¬
absolutely essential to stop the goodwill throughout the world
ization and high standards of liv¬ drain on dollar
exchange, quanti¬ to get rid of them. The degree of
ing, where technical developments tative restrictions on imports do success that we may expect will
are
providing the basis for new in fact make it more difficult to
depend entirely upon continued
industry and new trade on a scale bring about a permanent cure for close
co-operation among the free
which hardly anyone could have the
dollar problem. The respon¬ nations, and upon their whole¬
imagined a few years ago. The sibility for taking removal meas¬ hearted readiness to be helpful
main commercial
effect
of our ures does
not lie in our hands. in a job which is bound to require

living

that they will contribute in a sub¬

The

talks

populated, where the
tasks of raising the standards of

the very best use of the resources

total of world

more receptive to the idea of get¬
ting rid of them. They recognize

densely

nopolies, there is little likelihood

of

—

work

buyer.

a

as

by no means of the opin¬
that the efforts of the free

I

is that they do compel us to make

hands

the

are

ficiently large scale if the goods
are offered at competitive prices.

mo¬

in

trade

markets

again,

apt to be overbalanced by the de¬
hopeful that cline in other things. To put it
I shall not attempt to distribute the time is now ripe for a fresh another way, I think when you
the responsibility for the dollar attack on the problem of trade look into special situations and
As you may know, when
you
look into individual
problem. At any rate I do not restrictions.
tunities, for Europe in the west
think that "pointing the finger" the Governments of the Common¬ stocks, you've always got to be
and for Japan in the east—ad¬
sure that the general background
are
does much good at the present wealth
meeting in London
vantages equally valuable to the
time. We can't afford to postpone later this month, and the question is right, that there isn't anything
communist territories themselves.
the reduction of trade restrictions of trade is high in the agenda. hanging over things.
We do not know whether or when
The next risk I wrote down is
until we get unanimity of opinion Canada, of course, is not a mem¬
these natural avenues for the ex¬
about the precise and true causes ber of the sterling area, but we unexpected news. If you had gone
pansion of world commerce will
a
broker's office, for ex¬
of the dollar shortage. The most have been invited to participate into
be reopened. Meanwhile, Western
hopeful sign today is that some and we shall take a constructive ample, a day before Korea, the
Europe is the part of the free
broker would have told you to buy
of the countries that have been part in the discussions.
world that is most directly and
What Canada wants to see a good many stocks based on the
making extensive use of import
adversely affected, both as a seller
controls appear themselves to be emerge from these Commonwealth then peaceful situation and if you

greatest

very

great

Import Restrictions

the extent

idea of

rough

a

here

the

ready to accept imports on a suf¬

Needed: More Trade and
vey

but

American

North

.Thursday, November27,1952

I come back to and the market averages and the
essential — close and Dow Industrials, to use different
tenacious co-operation by all the phrases, if they all go down, why
free nations
a
resolute will to the improvement in Vanadium is

diagnosis, and it is open

reply that it assumes that

kind of

13

page

..

down

come

need.

I

along and

going

are

are

that company

has to sell in com¬
petition with every other stock.
I might pick out for instance, in
the steel industry, Vanadium, and
say that there are reasons why
Vanadium should do better, but I
have to think of the general mar¬
ket.

U.

S.

If

all

the

steel

stocks

and

Steel, which is the leader,

most

f. L. Rossmann Partner
Luke
New
Dec.

H.

Rose,

York

Stock

member of the
Exchange, on
a partner, in
Co., 120 Broad¬

1, will become

F. L. Rossmann &
way*

New York City, members of
Exchange,

the New York Stock

H. D. Kahn Opens

sell¬

up. We think its pros¬
better, but the stock of

like

think

Luke H. Rose to Be

DALLAS, Tex.—Harry D. Kahn

ing cheap. We think the earnings
pects

don't

savings bank.

we see a cer¬

tain company. It seems to be

when you get through

what you
people
can
do it, but they can make an
approach at it. They can do it
better than just by buying bonds
or
putting their money in the

interesting

general market
influences overweighing individ¬
ual stock influences. To me, that
is one of the most practical every
day factors that we come up
against in our every day work.
We

something

through

The risk of

me.

you

with

quite severely.

Now the next card is

to

leave

is

engaging in the securities busi¬

ness

from

offices at 405 Andrews

Building.

Joins Barrington

Inv.

(Special toTriE Financial Chronicle)

WORCESTER, Mass.
Putnam

is

now

—

-

George,

associated

with

Barrington Investments, 390 Main
Street.
: :
*r
■'
.

.

yolume 176

Number 5172

The Commercial and Financial Chronicle

...

(2041)
Continued from page 12

are

provided

tures.

Banking Is Affected
By Vicissitudes of Railroads
it is

phone

vate

utilities

where

better than 6%.

was

the

return

In manufac¬

matter of passing from

a

unfair

to

I

In

pri¬

government

Symes, our Execu¬
return on investment ranged
tive Vice-President,
recently
between 10% and 20%. I want to
summed this up concisely as it
emphasize to you particularly that
to railroads
when
he
this is not a temporary situation applies
stated that there are three
prin¬
but it has been
going

In the
riod

entire

from

roads

that

1936

in

years.

post-depression

earned

was

for

on

to

6%

1950

pe¬

rail¬

only once, and

of the

one

the

cipal

war

years

when

insufficient materials were
available
to
provide
adequate
maintenance

that period

average

over

turn

investment

on

only
of

little

a

this

the

On

programs.

our

railroads

to

In spite

have

found

turn.

to

earn

The

adequate

an

first

present in¬

our

is

that

the

re¬

we

required

are

to

operate

are

outmoded and
to

wholly inadequate
with present day condi¬

cope

the

as

of in¬

ravages

flation which have occurred since
World War II.
have

Second,

we

do not

national

modern

a

trans-

it necessary to lay out $6V2 billion portatiori policy designed to pro¬
in the years 1946 through 1951 for mote free competition among all
property
improvements and
to transportation agencies. The third
is

modernize

that

there

has been

lack

a

equipment.
Because
public sympathy and political un¬
have been
so
meager
no relief
definitely in sight, derstanding of the danger of con¬
they could not use earnings nor tinuing the unhealthy situation
raise equity capital for this work presently existing in our national
and
it was necessary to
obtain transportation system.

earnings

from
two
sources.
by depletion -of working
capital which has gone down from
$1% billion at the end of 1945
money

Delays in Granting

First,

to

dangerously low of $500 mil¬
lion at the end of 1951.
Second,
they have created additional debt,
a

the

effect

of

which

in

future

Rate

to

Between
are

ther

can

narrowing

spread

be¬

tween

income and outgo, not to
mention the creation of maturity

problems which could

prove

astrous

conditions.

under adverse

Much

-

of

dis¬

this

borrowing has
the
medium
of

in

obtain
the

from
the
one

World

based

is attractive histori¬
It is important to note that

the

in

relief

increased

For

rates

War II

example,

the

increases.

rate
on

effect

not

have

number

a

These

increased
and

since

railroads

necessity applied for

of

costs

industry

necessary

of

year.

such

paper

railroad

until

the

form

regulation?

regulatory authorities,
time lag has been averaging

of

cally.

time

costs

on

A

any

were

already
antici¬

the

now hold %2Vz billion of
pated increased costs. If the in¬
secruities, compared to only creases we have obtained since
$750 million at the end of 1945, World War II had been made ef¬
and although the incurring of this fective a year earlier—instead of

additional
ized

the

debt

has

safety

of

not

jeopard¬

the

railroads'

financial position, nevertheless it
is reaching a point where annual
maturities cannot go much higher
without exceeding the annual de¬

preciation
the

ate

them

charges, which

cash

gener¬

to

necessary

pay

off.

on

the

date

they were put into
the regulatory agency

effect by
controlling—we estimate that for
the Pennsylvania alone we would

have had
tional

time.

over

gross

Bear in mind

dollars

for

that

that this

during

loss

time when

a

borrowing

were

we

during

revenue

suffered

was

$400 million addi¬

millions

of

improve¬
A Message to the Next President
ments in our plant and equipment
I do not know how
many of you to meet the country's needs.
have

the

seen

extract

which

is

being published in the newspapers
entitled, "A Father's Message to
the

Next

President"

which

necessary

Aside from the harm thus done

directly
be said

to the railroads, it can
positively that our freight

is

rate structure would be lower to¬

popular
speech made by Mr. H. E. Hum¬

day than it actually is, had it not

taken

from

phreys,
United

rather

a

Jr.,

President

States

Rubber

of

been

for

such

the

time-lag between increased costs

Al¬

Co.

and increased prices.

though his message deals with an
entirely different subject, it is
interesting to note the following

One of the strange things is that
you

would think

"Surely you realize, Mr. Presi¬
dent, that profit is the incentive

dustry,

which makes
tem work.

Some

of

sys¬

it is paid in

above would be

an

evidence

and I

result of all

atmosphere of hope¬
among the railroad in¬
but nowhere can I see

Instead

opportunity

one

I have had to say

observation he made about to
create
return on investment:
lessness
sound

our

unreasonable

an

that
the

think

such

is

the

case.

railroads

generally,
specifically, are
the possibilities

ours

there

are

are

Station

short

and

to

the

LaGuardia and New

airports.

Let's

tion and Grand Central
cost in
of

cess

built

$200,000,000,

and

and

the

private funds of the
owning rail¬
In

comparison,

than

more

$150,000,000, of public funds, sup¬
plied by the Port
Authority, have
been

and

spent

to

build

LaGuardia

International airports. More¬

the two railroads paid over
5V3 million dollars in taxes on
their two stations in
1951, where¬
over,

the rental

as

paid to the City of
New York
by the Port Authority

for

the

than

of

use

in lieu of

the

taxes,

two

airports,

amounted to

million dollars. In other

one

words,
the
airports
are
subsidized to the extent of
million

less

dollars

a

occurred

tremendous

in

of

what

lies

ahead.

as

reward

a

to

those

optimistic

about

to

the

to timing.

extent

Analyzing, for a moment, the
Here, rather briefly, is what
"living on borrowed time" believe should be done:

insofar
the

as

they

railroad

relate

and

business, there is only
Both

perform

services

and

it

to

the

one answer.

public

necessary

is

both

banking

riot

of merely passing out of

a

matter

existence,




(1) We
levels

of

need

vide that all

cies. pay

policies

at

to

kind

some

of

today

be

less
is

timing -of

although
date, we

favorable
do

we

must

know
the

the

operations,

transportation
full

cost

including

of

agen¬

their

/air por¬
tion of the cost of facilities which.
a

optimistic

with

the

on

long

the

the

aggressive

a
program
the future.

of

program

have

we

fear

no

of

While some of the
figures I
have given you
today would seem
to be depressing, I assure

that

you

conditions

need

be

changed only

a
little to change these
figures
dramatically and restore the rail¬
road
industry, and with it the

entire

as

Therefore,

not

face

far

so

concerned.

optimistic

placing the facts before all think¬
ing people. With success in such

operating under conditions which
will

are

tinue

as

when any substantial
change does
come almost of
necessity it will
impose on us the problems of

volume

are

prospect of
changes in regulation if we con¬

change. Eco¬
dynamic and

are

safety.

any

men

a

the

transportation

position where it

industry to
make out¬

can

standing contributions to the ben¬
efit of the entire national
economy
and
paticularly to the

reality

that sometime in the not
too dis¬
tant future both
your industry and

banking

industry.

being
several

year.

being poured into
the

time

same

an

airport

railroad is

our

$27,000,000 to

modern¬

Chicago, Rock Island

ize our
passenger terminal, is an¬
other good illustration.
The same

Although the stock did not act
situation
exists
in
many
other badly on the news, there is little
cities throughout the
question but that many analysts
land.
(2) Legislation should be en¬ who follow the situation closely
were quite
acted which will direct the
disappointed over the
Inter¬
state

Commerce

eliminate
requests
up

to

they

move,
effect

into

to

delays on
adjustments—

rate

down, whichever

or

are

Commission

unreasonable

for

they

way

must

promptly

be

put

enough

to

allow railroad
management to
price its product
realistically and
according to the dictates of com¬
petitive business conditions.

(3) Legislation
that

should

provide
Commerce

the

Interstate
Commission take into
effects

of

account the

clare

the regular dividend

or

cent

de-

There

er

the

been

undertaken
curva-

stallations

mod-

signal in-

have

been

nancial

made

community who had been throughout the system. The road
looking forward tp liberalization has gone in
heavily for diesel
of the New
York, Chicago & St. power. These heavy
capital ex-

Louis dividend.

The financial

penditures
have
brought about
quirements of the latter, however, important
operating economies. At
are still fairly
heavy so that dis- the outset of the
improvement
appointment over failure of the program the road's

land.

re-

ratio

was

'

effect on volume of
traffic. This would make the
Rock Island has been
man¬
spending
of the property
responsible heavily on the properties for about
for their
15 years. Dieselization is well
actions, and it is
and the property
gram is

has

now

been

down to 36.5%.

increase

an

38.8%, due to the

last
severe

There

year, to
floods but

been

sumed again in 1952, with

re-

cut

a

°/ 3-6 points in the nine months
through September. For the full

virtually completed. Cash

position
and

was

the downward trend has

along
improvement pro-

our

belief that
they are in

to

transportation
running above 40%. By

was

1950 it

agers

a position
determine the overall result of
rate
changes in the highly com¬
petitive market which now exists

have

heavy grades and

in the fi-

many

least

Terminals have been
ernized and extensive

proposed

the

at

ture.

on

than

show

continued,

was

also

were

to

Major line relocation

years.

programs
to reduce

year-end extra at their
November meeting. The old
$1.00

rate

able

less than 30% of such earnings, n
Rock Island has
improved its
operating status materially in re-

a

quarterly

be

$14.00 a share for the current year,
The $4.00 dividend will
represent

failure of the directors of
Chicago,
Rock Island & Pacific either to increase

& Pacific

should

adjust¬ directors to raise the $2.00 annual
maintenance of railroad rate last week was not nearly so
credit and financial
acute as in the case of Rock Isstability rath¬
ments

year

-jt may well get down

around 35%,

strengthened

to

■■

The improvement program has
a/s0 been effective in increasing
tpe raad's traffic potential. With
conservative. Not only was the re- *lr}e changes and modernized terorganization of the road the most
^.P3!8 *be ^ne bas become better
drastic for any major
carrier, but, fble to compete for the profitable
appears at least

adequate
in the
transportation field. Pricing to meet any contingencies that
is a function of
might arise. Capitalization is most
management and
should

be

returned

to

the

hands

of management.

(4)
short

The

so-called

haul"

clause

"long
of

the

and

Inter¬

the

also,

debt

has

been

reduced

Commerce Act should be substantially since the reorganization was consummated. Aside from
repealed. It does not
apply to our
equipments
the
road
has
only
competitors and should not
apply one bond issue
to the railroads.
outstanding, the
While it
exists, $52,737,000 1st
2y8s, 1980.> This iswe are forced to
state

compete in

overall

transportation field

this artificial

(5) The

the

with

handicap.

railroads

should

be

able

to appeal to the
Interstate
Commerce Commission from
ad¬
verse
decisions by the State au¬
thorities when, because of

local

political

To

Has

the

Not

more

Come

Rails

Before closing, let
all

we

range

changes to come, we can all be
positive about one thing and that
is that every
day brings us closer
nomics

imperative

an

Pittsburgh,
$33,000,000, of public funds

are

we

government which pro¬

Railroad

Regardless

and

with

about the attitude of
Congress in.
giving us some of the immediate
relief in legislation
needed and

your
guesses
like ours
the gamut from
depression to
mild recession and there no
doubt
is considerable
variance in your

as

therefore,

survive

conditions.

get ready that cannot be

postponed

suppose

differences of opinion

to

to

favorable

The situation at
where

Prosperity

Words

need

run

your

less

There is,

I

has

sue

sinking

the

benefit

fund.

of

With

-

a

this

liberal
back-

ground it has long been felt that
Rock Island should be in a position to pass along to stockholders
a
larger proportion of reported
earnings than would be feasible or

conservative for the

industry

as a

considerations, they are whole.
denied the right to
adandon serv¬
people who put up their savings of improving our
Rock Island is having a
circumstances; ices which show a
good
continued and
to build plants and, in that
way, providing
year in 1952, aided in no small
we
can
persuade hopeless
financial loss.
make more jobs. The purpose of
measure by a favorable
enough people to look at the situ¬
grain crop.
Without the enactment of
these dividends is to make them ation
all
Year-to-year comparisons with
critically and constructively, the above
want to invest more, instead of and
program, or a substan¬ 1951 have also been
then help us to correct the
influenced by
tial portion of
it, not only is the the
spending all they make. The re¬ ills which are
heavy flood losses sustained
responsible for it. future of
the railroads as a
mainder of profit is put directly I
pri¬ last year. With a rise of only 8.6%
know that all of our officers
vate enterprise in
back into the business to provide
jeopardy, but in gross revenues for the nine
are optimistic about the
railroad's also the
future of other indus¬ months
new
and
better
products
and future if these
through September, net
changes can be tries which
would be
equipment.
endangered income soared 71.6%. In Septem¬
made in our transportation regu¬
by our failure to reverse
the ber alone net was more than 200%
"A company forced by the
gov¬ lations, and we are also optimistic trend
to more and
more discrim¬ greater
than in the
like
1951
ernment
to
operate
on
an
in¬ that such changes will be made.
inatory and restrictive regulation. month. Earnings on the common
adequate profit is living on bor¬
stock for the
nine months this
What Should be Done
rowed time."
dividends

under

industrial

exit, and many of you, I
presume,
have
been
making guesses and
estimates

industry wil have

my

the

expansion. None of us know how
long the present condition will

thinking

ex¬

has

of

of

were

maintained by

are

It

midst

—

Grand

distance

activity and production

known.

pres¬

compare these two different
types
of passenger
terminals. Penn Sta¬

investors

these

City

York International

spending

the

through
equipment trust certificates, and

been

the

increased

years, of course, is to reduce fur¬
the

Increases

government

Central.

at

Do you realize, for instance, the
tough problem facing the railroad
industry in periods of inflation
due

York

Pennsylvania

of

with

this

ness

asking

large passenger stations

roads.

pro¬

cedures of regulation under which

tions—such

re¬

amounted

3V2%.

over

the

for

reasons

ability

New

two

think Mr.

the

not

are

ently exist.

ownership.

turing, wholesale, and retail trades

we

disadvantages which

East

ownership

by public expendi¬

this

for any advantages for
ourselves,
but we do want to eliminate
the

How

the regulated electric gas and tele¬

In

29

year

came

to $9.15

pared with $4.55

me cover one

if the final

a

share,

com¬

be

been

borne
about

in

mind

which

that
we

the

have

for

the

full

year

talking has developed dur¬ further
ing a period of the highest busi¬ months

gains
so

the increasing operating effi-

a.

appointment

in

that

the

last

the/

three

company

over

the dividend.

Dr. Wriston Resigns
G.

Keith Funston, President ot?
the New York Stock
Exchange,
has announced that the
resignation
of Dr. Henry M. Wriston as a
Pub¬
lic Governor of the
Exchange had
been

regretfully accepted by tha

Board.
Dr.

Wriston, President of Brown
University and former President
of

the

American

Association

Universities, had been
of

the

since

f':.
*

I

of

member

a

Board of Governors
'

William D. Crane Opens

Actually

to look for

final

^enc^ P13?^ analysts still regard
^be stock highly, despite the dis-

-

1952.

a

1? Parts of the service area. Thus,
r.be company is no longer so heav1 ^ dependent on the wheat crop,
With this g00(j traffic background,

'

there is every reason

As

consideration, there has been considerable industrial development

should;,be no'

important phase of this dis¬ better than the closing 1951; quar-J
of our joint problem. It ter this would mean $13.00 a share

situation

Rio Grande Western.

ago? Evert* Aug. 1950.

a year

quarter

cussion
must

transcontinental traffic.
In
this
*be roa(* bas also benefried from betterment in the statu? °f the connecting Denver &

William
in

an

offices

D.

Crane

investment
at

534

New York City.

is

engaging

business

East

52nd

from

Street*

w

30

The Commercial and Financial Chronicle.;

(2042)

appointee,

-

Continued from first page

We See It

As

•.

together into an effective working unit under conditions
which, nonetheless, will permit and encourage each of
them to retain their independence of mind and hence
able to contribute most bountifully of their several abil¬
and

ities

Such

experience.

a

general staff would blow

apart in a short time under a Roosevelt or a Truman.
There is reason to hope that the story may be quite a
different one under a President whose long suit has al¬

of finding a way to get harmonious action
able men always independent of mind and
infrequently with differing view.

ways been that
from groups of
not

Key Posts
In the circumstances,

the key posts in the Administra¬

tion, at least so far as the business community is con¬
cerned, may be designated as the Secretary of Defense,
the

Secretary of the Treasury, and the Director

of

choice

Continued

The

new

Administration will have

one

of the foremost

of the times at its head, and it will have
one
of the greatest industrialists of the times directly
managing our defense activities. That Administration is,
moreover, committed in advance to the belief that vast
savings can be effected in our defense program without
reducing its effectiveness or the speed with which it can
be brought to completion, so far as such things ever
reach completion. The military specialist at the head of
this Administration has, moreover, unique
experience
abroad which should enable him to judge out of his own
past work what must be done abroad to insure our safety
at home. If such a team cannot succeed, then success is
beyond

us.

But

the services.

Here is the rock

has been wrecked in the

past.

on

be had from

Not only have representa¬

the earth

and everything that is in it—and of warning
against all manner of disaster if they did not get what
they wanted—but they have been endlessly competing
with

one

nation.
more

another for the attention and the favor of the

The

than

a

merging of the services has been hardly
formality. General Eisenhower himself has

to

bring real unification into being, and at the same time
will back Mr. Wilson fully in the endeavor we are certain
he will make at an early stage in his career as Secretary
of Defense to see that all the military authorities proceed
from this time forward with reason and in conformity
with ordinary commonsense in their dealings with those
who undertake to produce the weapons of war, who could
doubt that large sums of money could be saved the tax¬
payers without any impairment whatever of the security
of the nation?
And not only save money but release
capacity and manpower to the production of goods and
services that we all need and want in our daily lives.
Treasury Problems
A new,

different and more constructive administra¬
Treasury Department could do the country
a service
scarcely less important than a thorough over¬
hauling of the defense program and procedures. The new
tion

of the




by

change

mains to be
But

"

be

about. to

radically
'

seen.

with

:

,

a

re¬

^

y.

outside of this

qualitative,
atmospheric factor, there have

this

been

two

ences

.

well

may

rather

Administration^ but that

new

specific adverse influx
equities which

on

any

an¬

alyst must take, into account;^.

V

•

The first has been the

toward

lower

profit

tendency

margins,

lower percentage of sales

a

brought

down to net income.

;

The second has been the

higher

corporate income taxes, which re¬
that

duce

income

net

very

radically before it is available for
stock values.
"
The

'

effect

is

margin

-

.

theK lower

of

in

adverse

profit

two

ways.

only does it naturally reduce
average.

which

no

means

a

vulnerable

yield

index

—

have

At

the

dwelling

time, the stock rate is about 51/2%,
as against about 3.2% for the bond

upon.

wholesale price index rose
between 1900 and 1925 from 56 to
The

103 Vz.

82%

This

an

quarter

the
century. In the 1925-1950 period
it rose from 103 Vz to 161 %, which
was an increase of only 56%.
And
if

,

add

you

from

12 or 13% advance
date, you still have

a

1950

of

to

increase from 1925 in wholesale

an

prices which is less
the first quarter of

Thus, it would be
in

that

inflation

the

is

something that
in our experience

World

II

War

World

War

tionary

mistake for
thinking to

a

investment

our

believe

than that of
the century.

I

and
had

aftermath.

its

fully

infla¬

as

the

effect on

an

factor

generated
only through

was

of

cost

living, and there were inflationary
tendencies at work

in 1900-

even

1913.

formerly when the
margins were greater.
It

have

4.46%
a

has

in

it

1935

in

2.74%

to

assumed

that

dividend

should generally go along
rates, at a proper
spread
or
interval,
that factor
would have made for higher stock

yields
with

interest

prices because of the higher valu¬
ation of each dollar

in dividends.

Actually, that situation proved
paradoxical in two ways. In the
first

place, the decline in interest

rates would never have been pre¬

economists,

by
we

had

they

to

an

increase in

to

$250 billion. They would have
expected a significant rise in in¬
crease

rates; because the
in

interest rates

in¬

big

that

place between 1916 and 1921

took
was

identified with the
government borrowings in World
undoubtedly

War

I.

However,

newer

concepts

government financing which
introduced in the Roosevelt

were

Administration succeeded in turn¬

ond,

the

is

it

previously we would have ex¬
pected high interest rates.
The second part of the paradox
the

ing,
dend

historical
yield.

Let me

give

point.

high

cost

be¬

now

that
large volumes to
producers;

on

fair return

a

that in^

say

whole have

a

the

on

capital;

of

reinvestment

considered to

generally

in Wall

extent

Street;

assistance

the

have again

big

sec¬

of inflation which

dose

have had since the turn of the

Bias

Can

courage

the

belief

back

the

old

to

that

and

en¬

are

we

well-

once

established thesis that stock prices
do have a long-term upward bias,

their

that

and

should

be

future

regarded

prospects

for

good

as

if

volume

moderately
would be very

even

.

Depressions Be Avoided?

Consequently,
that

assume

sions

must

ture

in

avoided

be

if

stability
other

the

fur

be

op¬

to

the

the

regularity,
overall main¬

future

earning power:

words,

we

as

companies

whole

a

built-in

have to

may

stability

greater

economy
new

in

are

we

and
of

assume

have to

may

serious depres¬

about

tenance
In

we

very

toto

timistic

in

the

offset

to

instability in

a

many

in the form of higher

operating ratios.
That is
think

point for argument. I

a

economists

as

whole

a

are

inclined to believe that the future

will not be

economy

the

as

unstable

as

had

economy

1933.

prior

been

Partly because there

are

good many built-in factors

which

Those considerations would

off

earning power
seriously threatened.

to

century.

that

and

fall

the

and,

which stocks

received from the

point;

should

large-scale

prevent

lapse

now

coL

in

purchasing power, and
partly because governments — in¬
cluding, it seems, the new Ad¬
ministration—
mitted

large

to

strongly

are

preventing

falling

off

in

com^

any

very

employment

and in related business

activity.

>

pull. This view seems
especially plausible to me, because

So much for the factor of higher
operating ratios and lower profit

when you

margins

the

long

study economic history

the last 38 years,

over

would

you

sidered

have to acknowledge that the fab¬

the

ric

which

—

as

be

must

con¬

adverse element

an

in

tion.

to

of

equities

has

been

subject

tremendous strain, which cor¬

a

the

to

responds

strain

imposed

the free-enterprise economy

upon

We

had

have

have

two

world

what I

now

had

unexampled

an

might well

have

collapse

in

second

and
say

values.

I

sumers.

that

Dilution
What

income

tax

a

on

said

on

con-,

respectfully

dis¬

Through Taxation

the

corporation

tually works out
of

the

stock

is

as

of

a

tax

It

is

payment

instead

.

ac¬

dilution

a

equities.

stock dividend which

goes

of

the

of

a

to the
to

the

stockholders.
I

the future will have to offer.

of

been

agree.

government

anything

factor
not

corporate

must

sort of animal and should be able

almost

ques¬

Fairless

primarily

equivalent

survive

Mr.

that

are

equities have survived these tests
they appear to be a pretty rugged
to

has

taxes

and

that if stock

any

the

one,

taxes,

recently

We have

to¬
collectivism.

without

fully understood in its impact

tendency

enterprise,

controls

ward

One

free

World

We

the economy after 1929.
had
a
world-wide

against

wars.

call

Two-and-a-Half.

War

The

corporate
stock

of our nation.

We

picture,

would

like

to

take

a

minute

to show

you how that works out
in practice. First take the 1939 tax

Basic Factors That Make for
Stock Values
But let us,

rate

before accepting that

and encouraging conclusion,

of

16%; and assume net be¬
million; tax, $160,--

fore tax of $1

effect
you

in

interest

correspond¬
upon

divi¬

the figures

In 1935

on

the dividend

stock values. We know that there

000; net after tax, $840,000; num¬
ber of shares, 84,000; earnings per
share, $10.
•
.
t
Now, assume you h^ve a 75%

have

decrease

rates did not have the

that

not

any

the

that

large

sec¬

profits, which I believe has had
an effect on stock values, although

economics around, and
creating low interest rates where
ing

for

the last ten years;

over

have

going

were

national debt from $40 billion

terest

state¬

our

reasons

figures. Moody's

substantial change.
since risen to 3.18%, but
is

basic

Long-Term Upward

the net decline is still very great.
If

company.

the

that

seen

early 1930's.

very

as

they depend

a

of interest rates declined

customary to

come

even

the price rise in stocks are, first,
the larger earnings that we have

we

some

Yields

Stock

vs.

We come back then to

ond

Here are

average

°is

parted

ment

and

inter¬

Yields

One ex¬
planation of that may be that in¬
vestors generally have had an un¬
derlying mistrust of the low-in¬
terest rate concept as artificial,
and have not followed it through
in the field of stock yields.

was

est rates since the

of

have

situation

this

the considerable decline in

our

Bond

Evidently, the course of bond
yields and that of stock yields

higher stock prices

entered

made for

is

dustries

profit

that they have a very high break¬

third

The third influence that should

adverse effect oh

an

had

earn

rate.

of

increase

was

first

the

in

present

develop¬

typical company
recession would have

large

a

as

time declined to 2.88%—an enor¬
mous

adverse-

the earnings of a

on

difference.

big

as

a

stocks than bonds.
In November, 1950, the dividend
yield had gone up to 6.80%, al¬
though bond yields in the mean¬

to

in the general economy. A
medium-sized
recession
might

ments

with

compared

their bond

for

earnings, but also it

makes companies as a whole more

Moody's 200 stocks was

on

lower

It is in no sense unique,
and the relevant figures are worth

World War II and

is necessary

yield

4.26%,

Unique

phenomenon in our economic

new

known

President will do whatever

enterprise
as
represented
particularly by big business. That

history.

where there used to be
new

such, perhaps:

as

free

situation

•

dicted

If the

is

development

said that the net result has been to create three services

only two.

Not

do not realize is that the inflation

which many a program

tives of the armed forces been in the habit of asking for

we

point that many people

one

1946,
can

v

4

4.46%
Inflation

It

cooperation

page

developments which

from

Cooperation Needed
It will succeed if full

from

only too conscious of.'

are

us

men

enterprise

but toward the manifestations of

Y

Long-Term Outlook for Equities
inflation

pends upon a major operation on defense. Most observers
—perhaps too many of them—nonetheless hesitated to in¬
sist upon paring the defense budget. They felt uncertain
about the extent and nature of the preparations we needed.

military

.»free

the

a

production.

tility toward business. Not toward

/,

Not

Thoughtful students have long recognized the fact that
maximum improvement in the budgetary situation de¬

and

problems and tasks not fully covered by experiences The
issues which will confront the next Secretary of the
Treasury are technical in nature, more often than not,
but broad and pervasive in their effect upon the business
community and the country at large. If current reports
are accurate—and we have no reason to
question them—
the Secretary-designate; is; governed by sound general
ideas about such questions. He is reported to be firmly
of the opinion that the Treasury must ;tfindi ways, and
means of
taking care of its needs within the framework
of sound monetary and: credit policies established by
authorities who are supposed to carry that responsibility.
If such are his views, and in
light of his experience with
large affairs, it should not take him long to get on the
right track.
The prospect for a change in Washington—and in the
right direction—now appears good.

of the

They did not feel competent to reach independent conclu¬
sions about changes required to bring defense activities
to a point of reasonable efficiency and productivity. Nor
did they feel themselves in a position to estimate the
amount of savings possible by injecting a little more hard,
business sense into this matter of weapon development

ac¬

number ■? of

a

,

hope is greatly strengthened by
Wilson for Secretary of Defense.

Mr.

be* gathered from current

can

.

ing Federal outlays within some measure of reason at as
early a date as circumstances permit must be regarded
as far better than they have been since the New Deal and
Fair Deal developed budgetary megalomania.
the

as

•

Budget. If one may assume that the latter post will be
filled by Mr. Dodge—or, if one may assume that at some
other post Mr. Dodge will be at the President's side as
chief adviser on budgetary matters—the outlook for bring¬

The basis for such

far

so

of his career, \will/be faced/with

counts

Thursday, November 27,1952

.

stock dividend. You have the

easy

examine

a

basic

the

little

more

closely into

factors :that

been

make

qualitative

for

factors

which have been adverse to stocks,
in

the

form

of

gover^ent hos-

figure
number

of
of

net

aftev

share?

*

same

nxes.

been

The,
in-

Volume 176

Number 5172

The Commercial and Financial Chronicle

...

(2043)
creased
and

by 63,000 to 147,000 shares,
earnings per sh^re are

the

down to $5.70.

Thus, if
stock

one share of
of before the

instead

now

dividend,

buy

your

earnings
instead of $10 per share.

New,
but

assume no stock

instead the

52%.

The

1952

npt
net

of

the'

is

former

-What

dividends,

527
52%
a

trom

lb

/o

pre

per-share

75% stock dividend to the pub¬
lic.
a

point

paid

75%

a

higher

the

of

price

shares.

for

the

would have been in the

tinued,

as

a

stock

was

that

he

same

posi-

rate

con-

who had bought
lower price but

man

at

the

subject

now

At

stock

tion, with the 1939 tax
the

investor

result had he

higher price for the

number

same

is

same

to the

1952

tax

rates-

.

I

am

the

increase

tax

is

cern

of

the

business

overall

the

to

of

the

of the

or

that

is

income
con-

the operating postt+
corporations. It does

the

concern

terms

at

corporate

much

so

tion

driving

in

value

of

stockholder

share

the
in

capitalization,

price which he

pays

for

shares, which
amounts
pretty much the same thing.

to

the

Now,

.

.

forward

to

show

what

the

effect

has actually been on a typical cor-

poration. What
in

mcrease

find is that the

you

volume

plus

themselves

to

.

,

™

9Jl

t?

.

that
.

an

eq"a a

the

in-

,

?

.

As you know> that is the Phil"

OSOphy behind the rate of return
nnn,tf„j

allowed

by

regulatory
is

that

the

large

rate

that

new

The

be

The

utility

-

principle

return must

of

enough

tracted.

so

public

bodies.

the

capital

to

policy

erally

for business genlarge scale additional

if

investments
after

be

to

are

You

might
in

made

that

say

the

year

The

has

railroads

earned

0ld

the

study
.

figures

cost

as

.

have

saving

the

of

whole.-

a

whole

a

what

in

The

in-

new

entirely for

the

over

the

for

not

plant
plant
some¬

Let

me

fngs

give

years—

$10

of

to,,

after

tax.

of

before

panies.

a

would

come

illustrative
earn-

tax, and

$8.4

mnvnnrA

25%

increase

they would now be $35 before and
$16.80 after 52% tax. These fig¬
ures

somewhat

are

similar to the

Dow-Jones Industrial unit
as

You

-

figures,

matter of fact.

a

will

the average
Dow

dividend
the

to

earnings,

Industrial

group

as

War

the

II,

big

allowing

increase

of

roughly 250% before the tax adjustment, and then making the
large adjustment for the higher
tax

rate.

(Excess

for

paid

out
'income

via

claim only
a
claim on

a

not

is

that

it

be
get

may

corporation to
this large tribute
a

adverse

like

this:

Government

(which

and

bine

to

and
pvp

profits tax, com¬
prevent a long-term in¬
the

present

s

The

its assets, assuming that

those assets

of

tax.

simple

this:

possible,

in

reasons

economic

our

make it
Let,

are

inherent

structure

which

highly unlikely.

me

are

develop those for

large

committed

annual

plant

earns

if it

half

is

this

is

it.

This

an

tax

million

a

f5%

a

million

a

on

50%

a

a

adequate
not subject to

were

after

only

be

of

it

has

dollars,

rate of return;

inadequate.

make

the

$f0

worth

not

rfrore

It would

million

of

assets

in

the
If

than

$5

million

market,

you.

requires

a

expansion,

million

of

that

asisets

those

of

are

$10

realiz

a

able

characfer,

it would be a
inducement
to
the
directors
of
the business to turn
those assets"Into $10 million of
one

way

another,

or

liquidation

or

or

on—-rather

so

basically

by

merger,

than

accept
continuous subnormal

a

return

not




of

stock

highly

In

irregularly

upward, with
upon the adverb

emphasis

some

past—and

irregularly.

will

than

low

in which

be

valued

should

it

be.

promising
the

serves

and

one,

from

one

confidence

that
of

de-

those

6

page

You

have

seen

that

enon

working

York

in

be

Fourth,

the

liquor, solvents,

stock

out

field. Wwhere

gave

y0U

in

New

the

figures 1

arq^approximately

rep-

pf
what
happened.
oLTreturn realized by

rate

banks

here

npt been enough to
support the asset value, and so a

niftnber of

small banks
banks to

o\j& to larger

such

8

Fifth,

premium

a

bor-

on

and

peak

have been

apd

declin-

Demand

am

not

thing could
very
ness.

^predicting
or

large scale
I

am

that here

is

that

count

which

by

this

would happen on
in

a

general busi-

factor in the

econ-

has

to' be

taken

governmental

into
ac-

bodies

will

improvement

$39 billion,

to

$16

show

which

billion
net

a

billion.

may

shrink

year,

next

would

improvement

Adding

the

$23

of

savings

im-

provement to the debt accumulation

improvement,

$35

get

we

billion which should fix up the
bond market without Federal Resupport.

serve
we

not

are

Bear in mind that

including private and
pension

standing tax-free bonds will rise
from $30 billion to
$60 billion

by

1960, because of the accumulated
deficiency of road construction
by the automobile popula¬

rise

from

additional

as

32

to

__

**
the

school

cars

-

What of the demand for bonds and

are

depend

supply
will

demand

have

saving which is

now

normal

National

ratio

to

for

saving

to

back

There

Income.

reason

to

the rate of personal

upon

is

expecting
decline.

saving

the

to

Disposknown

no

of
volume

the

corporations

and

for the sake of this discussion.

If the

Under
does

the

not

of

the

two

join the school
thought which holds that the

will soften.

all

the

of

to be

statistics

personal saving. For example, I
that

say

$10,000 to buy

who

one

spends

house has saved
One may go broke that

$10 000.

a

But he will stay solvent and

way.

_

__

help the bond market if he

saves

vja the vehicles I'm about to list,
These

time

are

deposits of

com-

mercial banks and mutual savings

savings

banks,

and

ance

and

associa-

loan

funds, life incompanies, liquidation of

surance

pension

mortgage and other personal debts,
Frequent and reliable statistics
available

are

the

in

of

case

repositories of saving. We

including
pension

private

funds,

phenomenal

and

but

these

are

The

trend

downward

and

uuwiiwcuu

upward.

is

statistics

are more

borrowing

that
ihch

emu

Ihese

a

in

saving

is
*
is

dependable

saving of $2.1 billion in 1950,
$6.8 billion in 1951, and

preliminary estimate for 1952

a

we

will

<511

propose

gain

of $10 to

working

a

assume

jg not
with

at

so

the

compare

as

must

rate

level
of

next

saving

to be out of line

historic

relationship to
disposable income... To
next

billion

1950,

the

high

we

savings will

high

a

because

year,

basis,

that personal

the

theoretical
saving with that

year's

of

year

of

1

as

The volume of

housing is¬

new

tax-frees

forces operating to sustain
the volume of bank
earning assets.
For the long run, the

banking

'
...
system is expected to underwrite
the

maturities

years. But
are

apt

to

up

about

35- and 40-year
be
forced to

12

bonde

to

carrj

yields" comparable to corporate
bonds eventually. A
progressively
smaller

proportion of municipals.
is held by individuals
and

estate!^

death

as

great

taxes

take

fortunes.

large emissions
free

bonds

the

toll

Eventually
of the

will

ol

the

longest tax-

have

to depend
savings banks,
insurance
companies, pension funds, etc.

great

dis-

saving, to the extent of $2.1 bil-

In

summary—
The rate of debt

expansion

is

__

there

_________

little

was

tive to do

or

Fundamental trends indicate a
better bond market in
1953 and r
delayed
reflection
in
mortgage
rates.

prices
years

Tncfoorl

nn rfnr*

if

ic

longer Instead, it is
feared that the banking sysis dangerously overconcen-

_____

____

xhe

_

®

.

"

courtin.

beine
tJUlg

maturitiS

c

™a®«!i

oretuajlv

fhnn°n^LaPPK

®vmtuaUy a InriZ S
all Prime bonds

Sfhv
fected by

reduced interest

»

ai

af

rates.

With H. E. Work Co.
(Special to The Financial
Chronicle)

SAN FRANCISCO, Calif.—E.

Bac!he

W

h^o^co™e co^Yo^Bus!""

«■
woi
street. He was formerly
"• "• Moulton & Co.

yield incen¬

no

banking system js

earnings bv
concentrated in'short
danger to

with

Republic Inv. Adds

so.

(Special to The Financial Chronicle)

Bonds
If

That

sound,
finer

Are

Attractive

foregoing

the

reasoning

one

proceed

may

points

in

the

field

CHICAGO, 111.—Jack

H.

Mus-

liner has been added to the staff
to the of Republic Investment Company,
is

in¬

of

terest rates. Aside from the limit¬

Inc.,
He

231

was

South

La

Salle

Street,

previously with Baehe

&

ations imposed

by the special in- Co.
vestment and tax requirements of
the

indivdual

pla_„p„

f

institution, various

hnnrf_

hp

'i-

tpri

With Clayton Sees.

in

(Special to The Financial Chronicle)

fraction
market

in
as

relation

a

the

to

bond

than

th

BOSTON, Mass.
Garland

whole

New issues are usually more at
tractive

Dinion.

As

$10

a

hiiiinn

*ii

bond

net decline

a

gain of

as

of

of
Vi

more

repositories showed
of

of

trated in the volatile short-term
rate and runs the risk of getting
caught with high operating costs
and declining interest rates before
it has time to extend maturities.
The before or after tax yield difference between short and long
maturities offers practically no
incentive to lengthen out. The
motive for matWlty extension is
fear of being forced to buy long
bonds at higher prices later. In
the past the time to extend matunties has often been when

not

growth

whose

of

tern

municipal

whose

questionable. We

are

trend

\xrill locf rvnmh
will last much

use

one

to

which has continued for six

balance, and the bond
rodoin
will regain lfc PnmnflClirP
its composure

don't

don't

circumstances,

want

in

interest rates

I

the

for sewers, and

such

main

to pile up

may cease

xirill

be

items

debt and may enter the short- slowing down
importantly.
term bond market, but I don't
The rate of
saving is strongly
think I need to risk that prophecy reassuring.
•

rate

maintained

is

'

'

building which will
have to continue because
the peak
of public school
population will
not
be
reached
until

growing rapidly. Conceivably,

The

roads

produced

are

—

who demand yield
comparable to
corporates.

long bond market and which

loans?

million

new

portant single sustaining factor in

Bonds

For

the

for

52

upon

the

much

making the statement national
a

there

say

total

side.

So

out¬

funds., which
probably have been the most im-

'

The

and

a

municipal

'
three years.

*
for

been

of

capital expansion.
Business becomes expansive only
when
earnings after taxes and
dividends
are
rising.
Retained
earnings
today are only about
half what they were at the post'
ing

add

we

°f $12.1 billion in these selected

relationship
between retained earnings of cor¬

war

volume

likely to present a problem. It
is also likely to be one
of the

savings vehicles alone. Similarly,
the 1950 debt formation figure

Phistoric
8

the

continue
j

whose

is

of

-

rowing and spending,

has

result any
have sold

handicapped in being

class

standing is expected to rise for
the balance of the decade.
We es¬
timate that the amount of out¬

sues.

have

scuttling
which

taxes

-

placed

lion
have

likely

profits

excess

that

reason

1960,

Lower Interest Rates Ahead!
as
textiles,
drugs, etc.

es¬

down to

are

the

backlog of demand

such

them

not

no

are

the

(Other

phenom-

recent years in the bank

for

price, is a, since 1941, the need for

interested in the investment field.

Continued

bonds
in

tion

reasonable

a

is

Municipal

caused

at

market, and

between

bonds

bond issue volume next
year.
and
other
tax-free

new

I think that the future

is

the

emphasis
and

years

other

indication of slacken¬
utility plant expansion and

investment, when it is

that

in

as

bond

utility issues

there is

sum,

made

has

the

will

the

spread

place

equity

of

it

terested in trends than in statistics.

account and will be taken into

In theory, such
should

trend

more

as

tions, Federal Government insur-

asSfime

you

billion

investments

the

be¬

I

o

omy

new

expect),

ture

million

which has been running for years
now
at
the
rate
of
about
$25

annually.

that

not

thereto

equities will continue in the fu-

market

realize their asset values.

The first point is that the fulliemployment philosophy to which
we

equivalent

do

I

morbot

$10

taxes

normally

£>

case

has

and

But

left

realizable,

are

before

return,

HI

which

assets

dollars

21 i

o YT*

the

Take
company

resentative

Answer

The answer, as I see it, is
Such a development is
there

something

or

There

deflation

values, as well
earning power

will

The

but

must

this picture
one
business

which

on

Qccpfc

sale

from

nistic form of government here,

New

third

ing

there

time.

of

in

be

on

excess

prices

commu-

a

izing

and

in common stock dividends

crease

of

fViACn

con-

in spite of a Republican Admin¬
istration), and particularly can
the
development of the income

tax

absence

of

still Continue

may

the

point

downward

cash

trols

definitely

economy,

that

between

of borrowing declines and the rate

question,
Can

our

mind

of

strong

runs

in

to

to

pecially wide.

be wide variations in

away from
of
value to the Government by real-

profits tax has
not been allowed for here.)
These
figures lead us to our
basic
negative
or
pessimistic
which

con-

inclined

am

rather

now

years

able

feasible

and

World

been

ordinary stock divi-

an

result

just

for

is

I

established in

will

stock

is.

which

considered today to be
about twice
what
it
was

before

has

and

The

-

might be

first

that

universal

Government

would

probably find
that
earning power of the

Jones

-

Onq$ of

aboufejhis

on

O

~

think

which

be

existing comthe
important

result

a

1935-1939

With

Nation,

And

v

disparity; between the asset
values
and ^ie
earning power

taxes is that that is

some

Assume

possible

a

returns

tinuation of the trend toward in-

in

porations

by mileage.

as measured

profit

75% dilution of the equity,

figures.

of

reinvest¬

further than

go

may

because

so

-

wide

dend

a

most

by
basic American system continues.

-

second

assets

from

and

They

by

another, and one industry
another, but also very much

"

1

railroad

stock-

100%, which

as

yield

values

only

.

point,
which
is
related to then first, is that a very

taxes, that gain

thing

the

book

or

and

in

are

ties

and

support
-

has diminished

sizes,

you

railroad

The

the

on

J'

been

devices,

expansion

to

limited

same

have

discussing will prevent the
of
earning power
Government as long as our

re-

when

they
the

because

.i-

vestments

as

But

—w-

thesis,

0ur

has

been

we

sort

choice

features

system will go for them when it

the

rail-

have

adequate return

an

investment.

of the increase in

is the

con¬

next

are

call

long-term past, to
the building-up of
physical equi¬

in

were

as

been

"j""? Rested a without deal of
great having
money

the

as

the

of

that

the

reasonably attractive, the banking

Bear

believe

because

thev

increase.

not

the

of

case

same

before. But

those advances related

see

Governments

should

come

not

ordinary industry
of the non-regulated character,
worked

.

to

in

year

things

normally have induced
rise of about 250% in the earn-

as

not

lieve

at-

have

ent would

margin

will

be

will
will

same

many

for

it

(which

dation

the

..

that

is

on corporations
tend,to decrease
somewhat during the years; that

capital

old

on

true, by and large, in govern-

mental

decades

expropriation

increments.

prices that have taken
place between 1939 and the pres-

in

ings
available
holders,
given

.

siderations

annual

busi-

rate—particu-

prediction

my

the old investment must be ade-

teethe sale and liqui-

a

which

at

maintain

to

proper

Therefore, I

would lead

crease

a

,,

.n

certainly

that analysis

we can carry

feasible

at

ness

level

The

additional

.

factor that does not

a

is

the

Building-Up of Book Values

is

/structure today has

beyond

gone

ness—and

prove

roads.

Impact of Corporate Income Tax
What

tax

cor-

opinion

own

investment entirely.
Corporations may ina^e these the net burden
may
make uiese
investments without being must necessarily
investments without being

be

Another

the

quately profitable to induce large
is

earnings basis—to the payment of

would have the

may

^"ipuictuuns

itpre"
is

that

My

larly corporate business as corn- ment.
not pared with non-incorporated busi¬ that,

the large
large

happened

porations.

business

S°vern ,new

th»

ppcp

cisely equivalent—on

ate

of

old

setting the tax structure for

it

ordinary
profitability

of

is
is

,,

tax'rate from'let 'to
to
a

tests

new

institutional

why

$1
$1

rate

tax
tax

84,000, but the
share; are $5.70, as in

has actually

investment

many

still

per

old

In fact, it should

-

are

Th.

$480,000.

shares

earnings

There

able to
The number

urn ooo

is

the

way.

book costs.

or

reasons

,tJ"VwnIn'•
million, the tax is $520,000;
haianna
balance

its

its way on the basis of
plant costs rather than the

$5.70

are

tax

hefore
before

unless

pay

pay

V"

you

made
can

3r*

digested

markptq

issues,

arp

thin

beand

ence

between
been

new

about

as

and

wide

old
as

—

William

connected

V.

wit'

members

of

memoers oi

the

xne

Midwest
lvnawe.i

Stock Exchange. Mr. Garland
ith

Frederick

w?

c

Co

issues
I

can

remember.
Industrial issues

now

Clayton Securities Corp., 79 Mill:
oircex,

fause ™ .markets are tnin ana
^
j
j
larSe £lacks muf£ 0 ^, ca"^es~ Adams &
sions. This year the yield differ- Aaams «
has

is

Two With Waddell & Reed
(speciaitot„ef,».na,lch,c.»,o.e)

placed first
because the supply will dry up if
we are right about the future deare

kanc.c

r-TTV

mo_t

j, .' " '
"
Cramblet and John M. McCord
,

„

cline in the capital requirements

are

of industry.

Inc., 1012 Baltimore Avenue.

now

Waddell

&

Reed,

32

The Commercial and Financial Chronicle... Thursday, November 27,1952

(2044)

Continued from page

steel turning plow to

15

1951.
One can turn to

of

almost any seg¬
for other

industry

our

use

another. There are any
number of imported commodities,
necessary
ones,
desirable ones,

from

beginning to

100

which

moldboard

simple

the

the foundation of all the

was

im¬

plow will be pulled by a
couple of bullocks, yet its few
basic improvements will allow the
ing

do the

be

can

Then

home.

produced

abroad

economically

plow

provements in American agricul¬
ture.) Like the old, the new turn¬

to

managerial skills necessary
job.

(Its displacement

ago.

years

by

is not easy

more

than

why must

at

erect

we

barriers

against their import?
are
numerous
examples
tariffs, particularly in lux¬
ury items. This nation has reached
a position today where it not only
can, but should, have a fuller en¬
There

lion dollars

pockets — which
paying annually in
foreign aid by reducing, or elim¬
inating,
the
relatively
small
amount of $600 millions collected
annually through tariffs?

telling this important

are

grams

of high

Capital

of Private

Flow

The

flows where in•vestment opportunities exist. It
wi.ll
create
such
opportunities
Private capital

permitted to do so. Coun¬
capital and essen¬
tial technical skills for their de■when

tries

needing

More and
carpets
with fringes
those want¬ with it, of course, came a corre¬
made wholly of cotton__
ing freedom are counting on it as sponding increase in consumption. Partly hand-made, partly
a major bulwark against commu¬
Living standards were raised. And
machine-made lace, such
free people and

raise living
standards, to give more peoples
more
of the good thines in life,

Foreign Investment
Be Increased

Should

countries

12

today

are

lace

Princess

as

for

liminary
vinced

that

me

thorough

a

re-

study of tariffs with specific em¬
on the possibility of reduc¬
foreign aid is definitely in

phasis
ing

order at this time.

We

cannot

go

indefinitely

on

paying out these vast sums, and
friendly countries are getting
of having
to receive this

our

tired

bever¬

162.6%

aid.

business¬

hard-headed

The

approach must be taken now.

man

other

all

and

me. However, a pre¬
investigation has con¬

original with

(Bel¬

ages

Champagne

cannot hope to

we

morning. Nor can I claim that the

90%
spirits

sure,

this weighty question this

idea of possibly reducing tariff is

45%

gian)
Neutral

endless. In this world of ours,

are

importance then, there

of equal

It is

opportunities to

the

aggression.

nistic

be

To

answer

two wars.

winning of

more,

Sam is

Uncle

We ourselves should be

truth.

five billion tax dol¬

—

lars out of your

We have these skills in almost
unlimited
quantities.
American
the best
farmer to
cultivate 15 acres a joyment of the luxuries.
industrial and technological
advertisement of the importance
Here are a few examples of high
know-how is one of the most cre¬ year, instead of five, which is the
of foreign investment. I sincerely
traditional average."
tariffs:
ative and powerful forces in the
feope that our State Department world. It was a major factor in the
In this one instance, production
Belgian imitiation Oriental
and our Voice of America pro¬
was
increased
three-fold.
And

examples.

squally important

to answer. But, would
the five bil¬

it be possible to save

by

try

be discarded in this country over

capital as against public funds,
since
private capital must per¬
force bring with it the technical
and

the home production of one coun¬

replace the
The latter,

common

Cairo to Japan, was

More Trade—Less Aid!
jpaid out more than $100,000,000
la dividends between
1945 and

in

is

which

ment

desi plow.

traditional

foreign where the annual per capita in¬
The problem must be approached
sparkling beverages
44.8%
investment of private capital, we come is $50 or less. There are 14
with the full knowledge that in
Furniture of rattan, etc.__ 32.5%
isrelopment should, in their own must
step up sharply our export countries where the annual per
trying to equalize the stresses and
jself-interest,
provide
maximum
Further, we have tariffs — high strains of world trade, something
of technical and managerial skills. capita income is between $50 and
encouragement for the free play
ones
on many products which
is going to have to give at various
I say "step up" advisedly. I do $100. There is one country where
of this dynamic process.
we don't even make in this coun¬
points along the line. Some of us
not mean "hurry up." The steps the per capita income is $25. That
But this is no one-way street,
is just over six cents per person try. There is a cent-and-a-half per are going to get hurt a little, some
we take in spreading our technical
jfi is equally to our own self-in¬
and
managerial
knowledge
in per day. Contrast that figure and pound duty on nickel which has a lot, by the course we decide ta
terest to establish ourselves in
wide
industrial
use,
yet
we follow.
countries abroad must be cautious the living standards it must rep¬
neither mine any nickel in this
foreign countries. We are out¬
and sympathetic. Too often has resent with our own $1,700 per
Caution in Tariff Reductions
growing
our
usable
resources our attitude been "Look, you're capita income.
country, nor do we smelt any. It
much faster than any of us real¬
is all imported. Much specialized
In
any
examination
of
this
Wider consumption, the
third
doing it all wrong. This is the way
illus¬
that

increase

we

as

our

—

1

This

ize.

comparison will
of this problem:

trate the nature

it," with little or no

to do

thought part

of

theme,

your

can

come

machinery
which

and

chemicals

many

not made in this

you'll

problem, however, there are cer¬

coun¬

but

are

tain hard, cold facts we must ad¬
to the deeply implanted traditions about, I believe, through correc¬
States pro¬
try have high import duties.
mit. Desirable as it may be to
and inherited attitudes so differ¬ tive action in several areas; pri¬
duced 15%
more raw materials
Tropical fruits — luxuries, sure eliminate all tariff barriers, we
ent from our own.
marily, wider consumption can
than
it
consumed
(excluding
have a 17V2% ad valorem. I must
recognize the necessity of
only
through
increased
Here's what I mean: I remember result
don't know whether any of you
food); in 1950, the United States
protecting those segments of our
ease of distribution, which comes
are interested in buying a pigeon
^produced 9% less than it needed. reading a newspaper report in
industry necessary for the preser¬
which a leading industrialist in through an increased know-how
timer
a clock used
in pigeon vation of our
Projecting this trend, in 1975 the
high labor standards

United

the

1900,

Jji

—

nation's

its

of

short

20%

hill

materials output will

raw

estimated

on-the-spot

an

could

needs.

United States was a

the

Once

OCarge exporter of copper, lead and
zinc. It is now the largest impor¬
ter of these metals. We are grow¬
ing increasingly dependent on oil
from the Middle East and Vene¬
zuela. For rubber we have always
looked
Indies

Malaya, and to the
tin. Today we turn

to
for

Plan

Marshall

one

his

cut

country

told

reporter that he
selling price 30%

jportunity for practical application

self-interest"?

^enlightened
nay

phrase

over-worked

that

To

simply that it is to our advan¬

tage to develop such commodities
in

under-developed

is

areas

minimize the importance of
c:

to

such

^activity. We must of necessity in¬
tensify such activities for the re¬

That

More

trade.

creased

means

and

show a profit. When not aid, that people are demand¬
why he didn't, he said such ing.
Last summer this feeling was
an action would drive his compe¬
tition out of business.- "Then why clearly stated by Mr. Thorneystill

and

—

in¬

more,

throughout the world, it is trade,

asked

racing

—

if

you

are,

$4.50 per clock, plus 65% ad

pay

valorem. None of these clocks are

made in this country. They're

all

made in the Netherlands. Some of
you may

want

a

„

be collectors, and if you
muzzle-loading revolver,

them out?", he was croft, President of the British
you'll pay a duty of $1.75 plus
asked. "Oh, no," replied he, "in Board of Trade. He said: "We do
27V2% ad valorem to add one to
not want American citizens to tax
the first place,
I have all the
collection. But none
are
themselves into poverty in order your
money I want, and besides, such
made in this country. There are
that their country might become
a
thing simply isn't done in my

don't you buy

country."
hungrily to a developing area —
Let me give you another ex¬
the Belgian Congo — for a vital
ample
of
where
certain basic
commodity, uranium.
Confronted with this trend, are principles of American manufac¬
ture and marketing are considered
we
not also confronted with a
challenging opportunity? An op- inapplicable in foreign countries.
of

distribution.

of

Just

family in charge of one
foreign factories visited
In discussing ways and

our

Boston.
means

of

overcoming import re¬
the country he had

in

strictions

he pointed out
that our problems
were minor,
fortunately, compared to those of
other American firms operating in
this
country. In particular, he

just

from,

come

soup

of

cellor

summed

British

the
it

up

in

Exchequer,

words:

three

"Trade, not aid.".

similar

of

hundreds

examples.

What, I ask you, are we protect¬

ing?

of

Our

Foreign

selves

only are the rates them¬
exceedingly high, on a wide

of products, but the capriof
the
regulations is
often even more formidable. For
ciousness

Aid

Since mid-1945 to the middle of

current year, our

the

has totaled

foreign aid

$35 billion. Authorized

foreign aid for the fiscal year end¬
ing next June 30 is nearly $6 bil¬
lions

more,

amount

up

bringing the total
to over $40 billions.

this, the greatest outpouring
help
in world history, has

And
of

example: interpretation of appli¬
cable tariffs often varies from port
to

port. I know of one particular

foreign firm which found that by
using New Orleans instead of New
York its import duties were

siderably lower. Simply
of

national

our

What
closely
need this

security.

must do is to examine

the

in

areas

protection

which

we

to

them

hold

and

this:

to

in

What

we

are

aid

foreign

• our

a

down

basic minimum. It narrows

doing now

programs

is

taxing ourselves for the privilege
of excluding foreign merchandise.
this

exclusion confined to

But

is

the

necessary

alone? Are
price, in the

areas

paying too high

we

a

long run, for this privilege? And
it a privilege to deprive our¬

is

Not

range

Extent

recently a member of the

Gillette
of

kitchen of the Western
World." Then Mr. Butler, Chan¬
the

and
we

a

con¬

matter

different interpretation by the

of the good

selves

things in life?

have

We

already made a start
in the examination of our restric¬
tive trade

have

policies. Certain studies
completed, others are

been

under way.

termining

They are aimed at de¬
the extent to which

between Western European

trade

nations and the Soviet and Soviet

Orbit countries has been reduced

through

our

policy of restricting

aid to those countries which have
in the past

traded with the Orbit.
port's collector of revenue. True,
Apparently we must help our
these
rates
were
eventually
in some
European allies develop new im¬
cited a friend of his who, unable
Must Have Foreign Raw
brought in line, but many ship¬
respects as desperate as when we
port sources if we are to continue
Materials
any longer to import products for
ments entered the port of New
embarked upon our aid program.
our
objections to Western Euro¬
his firm's great retail outlet, was
Orleans before this was done. ■
With ech passing decade, we as
During this post-war period, we
pean exports to the Soviet bloc.
trying to keep his store stocked have had to contribute in aid the
Another
example concerns
a
a nation
are
growing less selfJust how effective has this re¬
with products of local manufac¬
French manufacturer of women's
Bufficient economically. The un¬
same 35 billion dollars we show as
strictive trade policy been? An
in a local
hats.
This
limited natural resources of which ture. He., had called
man,
adopting
one
a favorable
balance of trade for
examination
of the imports by
manufacturer and asked him to
we
once
boasted are being de¬
American
marketing
these post-war years. This is a growing
Soviet Orbit countries since the
market research
came
pleted. We must, then, turn to quote unit cost price on an article very expensive way of continuing tool
institution in 1949 of our Export
in quantities of 5,000. The manu¬
to
our
country to examine the
other countries for an increasing
to enjoy a favorable balance of
Control Act is revealing. It indi¬
facturer did so. Then the Amer¬
Sow of the
raw
materials we
prevailing trends in women's hats.
trade, and it is one of the main
ican manager asked, "—and what
He
was
convinced
that
hats cates that the free world countries
«&eed. And in doing this, it seems
reasons
why taxes are so high.
will their cost be for 500,000?"
adorned
with
ostrich
feathers are trading with the Orbit despite
to me, we are taking a powerful
Therefore, we
must
encourage
our
controls. The U. S. has cut
Appalled, the local manufacturer trade
were going to
Biride toward our better world.
be fashionable for
by reducing our tariffs.
its exports to the Orbit from $120
shook his head and replied, "Oh,
The
benefits
are
many.
We
When foreign countries are able quite a period of time. He re¬
millions in 1948 to $2.5 millions in
I
couldn't
give you that same
assure
ourselves of a continuing
to sell more in this country, we turned to his native France and
1951, while Western Europe con¬
supply of those materials we need. price if you want that many. Why will be able to reduce our aid and turned out a large shipment of
I'd have to put on more men, in¬
such hats. When
this shipment tinues to export $626 millions to
We
create
additional
markets;
also taxes.
the Orbit.
stall
more
machinery — just
markets not only in which to sell,
No longer do our tariff collec¬ arrived on our shores, our cus¬

alistic

of self-preservation.

reason

shown that aid is not the cure, as

situation

the

today

is

—

hut

where

markets

we

are

also

buyers. A rise in living standards
is always in the immediate wake
of
such
developments.
Peoples
whose
tered

tomers

places.

in

of the
ern

these

Many

would be

market

new

of

more

raw

be the only cus¬

we

these

markets

efficient suppliers

materials which West¬

Europe

must

now

purchase

from the United States. We would
fsee a

revival of multilateral trade.

To

bring

world

about

condition

mediate increase,
crease,

a

an

im¬

great in¬

Must Furnish "Show How"

Along

"know-how"

with

also

must

furnish

we

"show-how"




for

any

important

toms

officials

port

on

the

total tax collections.
In 1951, we had the largest rev¬
enue from
tariffs in the history

plumes came
procured

part of

our

country. Yet this revenue
amounted to only $600 millions,
or 1.2% of total tax collections of
our

an

an

a

visit

Since
a

tariff

revenues

"There *

we

saw

agricultural

the

United

en¬

States

native students

to

make

machin¬

that could be used by the typ¬

stance,

one

piece

was

a

For

in¬

modern

are

still

minor part of our total tax col¬

agricultural school in India. lections, should not

gineers, from

ery

Tariffs Should Be Reduced

article by Raymond

W. Miller. Mr. Miller cited
to

time

the

their

im¬

manufacturer

sufficient

had

affidavits

to

the effect that these were feathers
from domesticated

birds, and had

In

addition

tion

of

our

tariff

an

examina¬

then,

Europe today

main

regulations be

aimed at determining the areas

which

we

in

need protection for se¬

curity purposes only? Internation¬
al trade is mutually profitable. It
does not follow that trade between
nations means the

policy

well-dressed

riod,

sion of
have

our

an

inating,

women.

also, that revi¬
tariffs could very well

to

me,

important effect on elim¬
or

certainly reducing, the

amount of foreign aid we

annually.
I would

elimination of form of

a

dole out

—

where its

importing interests lie

that that par¬
ticular type of hat had fallen in
complete disfavor with America's
seems

recorded

contraband trade. It appears,
that the Orbit fares better

did

It

this

to

trade, there is much evidence that
there
is
large unrecorded and

months had gone by

example of this recently ap¬
peared in the Harvard "Business

Review" in

the

banned

grounds that the
from wild birds. By

such affidavits accepted, so many

$53.3 billions.

An

in the foreign investment ical small Hindu farmer.

of private capital. I stress private

account

of

improving and India working together with

an

demands

and

change

nomic thinking.

no

Nor would

tions

to

resistance

completely at odds with our eco¬

longer ripe for the
communist picking.
are

is

Here

being bet¬

of life is

way

couldn't do it!"

—

before
was

our

—

with

than it

restrictive

trade

initiated.

Significant, too, I believe, is the
fact that during the 1947-1950 pe¬
our

to
Europe
high of $15 bil¬

exports

dropped from

a

lions in 1947 to just over $10 bil¬
in 1950. During this period

lions
was

Europe making

Orbit
on

what

from the

Some

it

was

up

from the

cutting

down

United States?

like to put this in the
Europeans feel that our
question, and I know it restrictive trade policies tend to

Volume 176

Number 5172

squeeze

them

Curtain

and

Over

a

between
the

the

Tariff

Iron

a

Curtain,

ago, Hugh Gaitskell,
Chancellor of the British

then

"There

essential commodities

from

Russia

must

ask, 'Aren't

your nose to

capacity for the entire industry will be at

spite

000

I

there

our

we

have

We

severely,
point when the cut-

comes a

ting off of trade

does

one.

to

ern

democracies more harm than
it does the Soviets. We then
reach

metals

will

added, the 1953
an

take

it

better

a

yourselves

to

and

have

place,

"possibly

by

February,

involved

1953."

It

The

in

the

October

failures

clined 8%
week

and

mits

during

valuation
month

of

were

slightly less

to

compared

as

is

industrial

Steel Output Scheduled at

with

$367,445,821

Slightly Lower Rate This

demand

farther back into 1953,
production will still be growing.

comparable level of 252 in

Bradstreet
course

even

wholesale

to reach

The

war.

a

food

fell

3

drop of 6.1%.

Week

for

low

new

demand

easing

are

than

more

Nov. 18,

the comparable date

that

the

markets
at

the

drouth

^

a

balance

of

steel

supply

quarter of 1953.

the

end

weekly.

.

showed

close.
had

that

pressure

evoke

surprise.

Consumers

for increased quantities from

easiness in
of business

could

more

use

nrovement
provemeni,

The

demand for

business, although

concludes
conciuaes

American

"Steel"
p
.

Iron

and

pig iron.

daily

on

average

some

strength
led

broken

as

of

most

the

year

Weather

most

parts

of

Steel

announced

that

sought to offset the discouraging
effect

of

sugar

the

unseasonably mild
starting their Christpromotions earlier than usualL

mas

Although
these

in

end

284.38

at

the

week

following

results

of

rains

more

but
news

to follow.

a year ago.
noted

were

at

mid-

against

spot

market

year.

firm

Cuban Government had

and

Warehouse
a

week

scheduled
stocks

of

most

receipts

Late

retail¬
than

a

shopping
terms

hours

helped

and

to

easy

bolster

buying.
The

total

dollar

tail trade in

the

volume of

week

re¬

esti¬

was

■w

mated

by Dun & Bradstreet, Inc.,
from
1%
below to 3%
higher than a year ago. Regional
to

be

estimates varied
of

a

year

from

by

ago

percentages:

to

the

the

levels

following

New

Midwest

—1

England and
+3; East —3 to

to

+4. While retail dollar vol¬

above a year ago for the
eighth straight month, gains were
ume

was

less

than

pronounced
months.

Department

store

the

Federal

dex for the

week

1952,

show
of

the

on

Board's

previous week

a

in¬

ended Nov.

change
preceding

the

recent

taken from,

as

no

level

in

sales

Reserve

15,

from

the

week.

Im

decrease of

a

7% (revised) was reported from
that of the similar week of 1951..
For the four weeks ended Nov.

15,

1952, sales reflected a decline of
1%. For the period Jan. 1 to Nov:.
15, 1952, department store sales;
registered a drop of 1% below
the like period of the
proceding

week

New

in

retail

noted

was

trade

lasi

volume

for

York,

advancing from 7 te
8%, but notwithstanding this, the?
gain was only half of that ex¬
pected by the merchants, since the
latest
period
had
six
shopping

days contrasted with five days
the

1951

week

due

to

m

Thanks¬

giving Day.

According
serve

to

Board's

the

Federal

index,

Rer-

department;

store sales

inyNew York City for
weekly period ended Nov. 15,
1952, decreased 5% below the like

recommended

the

on

of

last

year.

In

the

a decline of 13% was;
reported from that of the similar

week

weeks
crease

of

1951, while for the

ended

Nov.

15, 1952,

four

de¬

a

of

5% was recorded. For
the period Jan. 1 to Nov.
15, 1952,
volume declined
8%
under the
like period of the

preceding

year-

J. H. Lederer Formed

news

In New York

restriction of

Coffee closed strong, aided by trade and Brazil buying.

pre¬

ceding week

cocoa

earlier, and 122,741

tone at the week-end

period

heavy

Joseph
Lard

declined in sympathy with weakness in
vegetable oils. Hog values
advanced in the early part of the week but moved
sharply lower
at the close as market
receipts reached the heaviest since last

February. Cattle and
marketings.

parti¬

the
some

the

a

not

ago.

credit

was

the

developed

larger

to

response

was

spectacular,

had

ers

over

improvement. Trading in grain
the Chicago Board of Trade last week
of about 50,000.000 bushels, compared

of

consumer

promotions

the crop.

sheep prices also weakened under heavy

the
Co.

H.

formation
as

of Dec.

Lederer
of

J.

City

announces

H.

1, to act

Lederer

as

under¬

writers and specialists in unlisted
securities. Offices of the fiim
will be located at 40 Exchange

oil

Place, New York City.

Cotton prices slumped quite sharply following early firmness,

largely reflecting the increased

crop estimate issued last week,
reports regarding current consumption.
Other
U«,,i
bearish factors included hedge-selling and liquidation influenced

..and

unfavorable
Ja'

*^T>yncbhtinued
!

Institute

nation did not vary appreci¬
ably in the period ended on Wed¬
nesday of last week. Merchants

Improvement

ago.

that the

now

.

the

decline

Spring wheat flours

interest

near

Raw

are

im-

closed

belt, with predictions of

protected

the

a

-

the

operating rate of steel companies having 93% of the steelmaking




in

year.

week earlier, and with 311.07

a

dropped to 43,644 bags, from 49.110

;

an

of

mills

arrivals

Wire mills too,
>»

currently note

bookings

when

manufacturer

This easiness stems

jobbing foundries.

year ago, or a

price advances of 5 to 10
hundredweight. On the whole, however, trading activity
in the domestic flour market was
spotty and small with buying
restricted to bakers and jobbers whose supply positions were in
need of replacement. Continued easiness in cocoa reflected slow

quarter of next year, declares this trade

among

a

cents per

In contrast to the heavy pressure for many of the steel
prod¬
ucts is the

a

Fair

.

from lack

index

The

years.

Wheat

been

futures

soybean

week

.

•

product

of the first

rancj

on

and

.

to

the like date

year ago.

Export business showed

to,reached

.

exerting considerable

on

although smaller than the previous week,

urn?.".

-While consumers cannot get all of the steel products they
.want, the tightest of all items is quality bars and forging billets
from 1 inch in diameter up.
Impact of the military shell and
high-rated defense programs falls heavily on them, "Steel"
points out.
V
Another very tight item is heavy
plates and heavy demand
for them is expected now to continue
through at least the second
a

week

"

that

downward

due to large export sales, notably
Marketing of surplus corn continued in heavy volume

to Brazil.

near

.are

two

Early support in wheat

/

Sheets

$6.68

comparing with 285.14

most of the Winter wheat

epough that plans should continue forward for
the early removal or relaxation, at
least, of government controls
on the distribution and use of steel.
Even some " of the
government
controllers are thinking in such
terms, it adds.
f

the

fffledIs3the contoued'teav'y demandHor! >with 43'000.000 the week before' and M,000,000

convinced

its

just after the start of the Korean

in

cents

resumed

,

on

substantja|m

could be enough,

consumers who ordinarily
rely solely
supplies, states this trade magazine.

men

are

The

index

•

.

on

though steel capacity and

,

Steel

Mild

trade

country-wide basis,

Following an initial rise, the daily wholesale commodity
price index, compiled by Dun & Bradstreet, Inc., declined to a

industry, the country's biggest consumer
steel, is in a strong drive for production. Steel consumers are
only trying to produce at a high level but are
trying to get
enough steel to build strike-depleted inventories back to
normal
levels, it continues.
,w.ui
Completion of inventory restoration will lift a

warehouse steel by big

the

Wholesale Commodity Price Index Registers
New Low for 1952

not

mills for their

in

The index represents the sum total of the
price per pound of
31 foods in general use and its chief function is to show the
general
trend of food prices at the wholesale level.

of

of pressure off demand.

price

low since

new

index

Grain

-

167

1939.

prewar

rent number compares with

weakened

-

to

to stand at $6.27 on
Nov. 18, the lowest since July 4,
1950, when it was $6.19. The cur¬

*

in

attitude, states this trade weekly, is that

not

increased

Wholesale Food Price Index Declines to 29-Month Low

a

near full speed. Business in
general remains
good. Outcome of the national election produced no bearish
sen¬
timent. The automobile

are

Unseasonably

considerably below the

industry men are amazed at the way steel demand holds
up, says "Steel," the weekly magazine of
metalworking, and they
are presently
inclined to push the date for a tapering off in

that inventories

failures

exceeded the 149 and 146 which occurred in the
comparable weeks
of 1951 and 1950.
However, they remained

Steel

amount

through that

+ 1; South and Pacific -f 1 to -f-5;
+2 to +6; Northwest

preceding week, Dun & BradAt the highest level since June, casualties

street, Inc., reports.

experienced during this period.
Building plans were filed in New York City
during October to
the value of $38,559,731.
This was a drop of 28.4% from
$53,886,760 in the like month a year ago, but a rise of
12.4% as com¬
pared with $34,304,009 for September.

for this

week

Southwest

week ended Nov. 20 from 148 in the

cities, including New York, for the

$414,918,371,

reason

and

.

The gain over the Septem¬
Normally a moderate decline

Their

the

brought total

season

166,200 bales.

Retail

0

Following the leveling off movement of last week, the Dun &

October 1951, or an increase of
12.9%.
ber sum of $390,060,988 was
6.4%.

defense production is

2,493 trucks against

and 2,375 trucks in the prior week.

cars

Commercial

Busi¬

than

.jg

Business Failures Point Higher

Middle

numerous

62,048

Canadian plants turned out 2,685 cars and

6,547

a

permits in 215

came

during
7. This

Trade Volume Rise Checked
by

cars

trucks in the comparable period a year ago.

construction mortality rose to the
highest

England,

98,609

output for the past week was made up of 98,609 cars
26,606 trucks built in the United States, against 107,473 cars
30,439 trucks the previous week and 62,048 cars and 16,062

and
to

contraseasonal spurt in volume of
building perOctober, reports Dun & Bradstreet, Inc.
Total

was

year ago.

Total

For
Casualties

and East South Central States.

above the like

compared with 107,473 cars (revised)
cars in the like week a year ago,
according to "Ward's Automotive Reports."

.

There

;

a

production in the United States last week de¬

car

in the previous week, and

major geographic
regions except the Mountain States. In comparison with
1951, four
regions had heavier casualties, including New

year ago.

date to

year

from the previous week, but was 59%

It aggregated

for any month in three
years.
not been so high since 1932.

Atlantic, West North Central
nesses failing in other areas

by Model Changeovers

The Past Week

level since
April; failures were up less sharply in
retailing and
The month's only dip occurred in
wholesale
trade which had the fewest failures since
October 1951.
There was a monthly rise in failures in
all

,

bales
Nov.

cularly

commercial service.

-

1.0% below the corresponding week in 1950.

cars, or

United States Auto Output Cut

all sizes increased
during the month except those
involving
losses under $5,000. Forty-nine
exceptionally large businesses suc¬
cumbed which swelled the
liability total by almost $24 million.

-

64,200
ended

weather by

total represented an increase of 14,465 cars, or
1.8% above the corresponding week a year ago, but a decrease of

8,735

rose

climbed

decrease of 475 cars, or 0.1% below the

a

week's

Passenger

fluctuations,

freight for the week ended Nov. 15, 1952,
according to the Association of American

cars,

preceding week.

monthly failures

$35,049,000, the largest volume

Manufacturing and

273,200 bales,
before, and

continued to expand, and totalled

was

Railroads, representing

■

of

to

400,100 a year ago. Entries of the
staple into the Government loan

revenue

totaled

5,o00,000, compared with

Failure Index," which extends the
annual basis and adjusts for seasonal
to 30 failures for every 10,000

October, liabilities have

declined

from 295,800 the week

Week

Loadings Drop Mildly Under Week Ago Level

Loadings of
828,723

Industry

enterprises listed in the
Dun & Bradstreet "Reference
Book." However, it remained below
the postwar peak of 40 failures for
every 10,000 operating busi¬
nesses in November 1949 and
compared with a prewar toll of 67
in 1940.

an

week

the

auto output will exceed

liabilities

parable period last year. Reported
sales in the ten spot markets last

entries for the
current total

Car

an

The

starting

week

87,271,000 kwh. above that of the pre¬
ceding week when output amounted to 7,883,878,000 kwh.
It was
814,111,000 kwh., or 11.4% above the total output for the week
ended Nov. 24, 1951, and 1,463,640.,000 kwh. in excess of the output
reported for the corresponding period two years ago.

1

"Dun's

slightly

at

The

built the best world.

estimated 4,360,000 this year.

rate to

the

In

Institute.

Business failures, rebounding from the
September low, rose
17% to 631 in October.
At the highest level in four
months,
casualties were almost as numerous as a
year ago when 643 oc¬
curred. There were fewer failures this
October than in the comparable month of 1949 and 1950.

-

equal to about 35,400 bales,
against 37,800 in the previous
period, and 36,600 for the conv-

electric light
industry for the week ended Nov. 22, 1952, was esti¬
7,971,149,000 kwh., according to the Edison Electric

power

mated

the

will

you

castings.

for

Electric Output Rises Further in Latest

And I firmly believe that in

•The State of Trade and
vital

make

steel

33k

was

The amount of electric energy distributed by the

a
better world, you
will find that when
you have attained your goal

venture to say, many other West-

Continued from page 5

want

dedicating
building of

and, I

us,

all

ingots and

106.5% (revised) of capacity and actual out¬
A month ago output stood at 107.3%, or
2,229,000 tons, while a year ago when the capacity was smaller the
estimated output was 2,079,000 tons with the rate at 104.0%.

—

exports

of

Nov. 17, the rate was

coarse grain
policy for Americans and all free
Obviously, they won't countries.
sell to us unless
they can buy
I'd
like
to
finish
with
this
something they need in exchange, thought: This is a
good old world.

Our position is that while

tons

put totaled 2,212,000 tons.

and timber.

restricted

of 105.5% of

an average

capacity for the week beginning Nov. 24,1952, equivalent to 2,191,-

am sure you are aware
of this
problem. It must play an
important part in
any foreign economic

have to

we

we

cutting off

(2045)

your face?'"

two

are

point where

you

year

Exchequer, said:
get

The Commercial and Financial
Chronicle

..

*

_

slow

export

demand., Consumption

of cotton in
period, as estimated by the New York
Cotton Exchange Service Bureau, was 875,000 bales, compared
with 737,000 in the preceding four weeks, and 905,000 in the
five.
V weeks of October 1951. The daily rate of consumption for October
the 5 five-week

October

Two With Bache & Co.

1

(Special to The Financial Chronicle)

RALEIGH, N. C.

—

Thomas X.

Bagby, Jr. and Sybil B. Salter
now

connected with Bache &

126

South

Salisbury

Street.

are

Co^

34

The Commercial and Financial Chronicle

(2046)

of

years

Program

REPORTS

sprint

INVESTORS,
of the largest mutual funds
investing almost entirely in com¬
mon
stocks, revealed total
net
one

Details and

of

assets

Prospectus

30,

request

SECURITIES A

RESEARCH CORPORATION
ISO Broadway, How York S,

H. T.

in its Sept.
report.
This

$135,457,901

1952

quarterly

represents
NATIONAL

an

assets

increase in total net

$20

to

since

million, or 17.1%
beginning of the year.

the

the

On

date

same

38,732

there

shareholders,

gain

of

22.2%

compared

in

the

nine

individual

share

months' period.

Value
of

of

Investors,

these

on

total

net

Inc.,

assets,

$19.70, compared with $19.55

was

at the year-end

6,875,660

1951. Each of the

shares

Sept.

30

ment

interest

outstanding

represented
in

securities held

on

invest¬

an

113

individual

by the Fund.

newly selected and

added

investments

were

stocks

common

last

standing

shares

of

of

of

times

the

was

this

ing

1,276,402

shares

Sept.

on

30,

cal
on

tions and prospects,
Francis

man

that

if,

Carolina

Electric

Common

& Share

Corp.,
obligation pleaae send

ter, the prospect
tenance

of

tivity

at
mainder

of

business

levels

1952,

for

it

now

that

prospectus on Canadian Fund.

No.

of

seems

Co.

Light Co., Electric Bond

Co., Mission Development
Southern
Company
and
eliminated from

were

same

holdings

period.

Largest concentration of invest¬

Nome.

in

ments

securities

of

Address.

industries appeared

City

leum, railroad and
groups.
More than
the

in

companies

in the petro¬
public utility
one-third

total5 net

Fund's

invested

individual

in

tries at the

assets

stocks

common

for

caution

these

three

end of the

of

recession

the

and

signs

Investors

Francis

FUND,

do

of

the

has

west,
assets,

passed

setting

growth

36

indus¬

quarter.

report of National

Corporation released by
Randolph, President

starting $150,000 in net assets to
the $10 million mark in just three
and

early

Custodian FuncLs
BOND, PREFERRED AND
COMMON STOCK FUNDS

Company

1949

when

Houston
serve

your

prospectuses

describing

Organization and the shares of

Funds.

ten

me

your

According

to the report, the
board expects to distribute in Dec.

of

be

that

made

-on

Name...

this

distribution

additional

stock

Investors or in cash,
option of each shareholder.

reinvesting

continued to be

fully
stocks, which

Sept. 30. Major new additions
portfolio during the third
quarter were 5,000 Ford of Canr

on

the

ada "A" and

4,600 Owens-Corning
Fiberglas. Additions to some issues
already

held

included

shares

of

Doehler-Jarvis, Shell Union Oil,
Signal Oil & Gas "A," American
Natural

Gas

Service.

Arizona

and

Public

The

holding of
8,000
shares of Brooklyn Union Gas was
eliminated
duction
of

and

was

Master

substantial

a

in

made

tions

were

ated

Gas

re¬

the

shares

Other

Electric.

reduc¬

in the shares of Affili¬

Equipment, Deep

Rock

Oil and United Gas.

Investment Fund
Prospectus

may

investment dealers

The

Parker

200

u

or

Corporation

Berkeley St., Boston, Mass.
•FOUNDED

1925




Sept.

figures

be obtained

from

had

assets
of

STREET

risen

$28,131,675

net
as

30,

1952, according to
published in this mutual

whole mutual

investment

in¬

According to the fund's
official performance chart, $10,000
invested

in

Texas

Fund

its

at

founding had a net asset value of
$14,700 on Aug. 31, 1952, the end
of

its

third fiscal

The
had

magic
lot

a

the

name

to

acceptance

do

of

of Texas
newcomer

hard

to

in

crack

industry, ac¬
cording to Victor Dykes, VicePresident and principal operating
the

fund.

Texas'

fame

the nation's industrial frontier,
which brings new people and new
firms into
the
state
daily, has
as

helped

sell

Texas

Fund

to

the

three

$24,250,467

Many of the
are

fund's

chase

Some

the

progressive

increase in the net assets of Broad

Investing.

at

&

net

During the

stocks

Dye

of

Al¬

Corp.

Shareholders,

the

The

Fund
57

of

also

common
was

"B4,"

with

a

diff^ent discount
for ^generous in¬

completed

its

Sept. 30, 1952.

the

fiscal

Its report

operations for

on

showed

in

substantial

a

number

outstanding, and this

shares

of

reflected

was

in the total net assets of the fund.

The

table

a

the

figure

stood

25,600.

at

this

standing

at

6,212,732

ten months

Oct.

On

31,

time

introduced

plan

for

below

gives these "and

other' figures:

;

KEYSTONE

;

'*

.

FUND ;"B4"

the

1952,

ho 1 d i

against

as

n g s

largest
Oil

were:

public* utilities electric
chemicals
and
drugs
merchandising
(3.6%);
public utilities-natural gas

(12.9%);
(9.8%);
(4.3%);
and,

(3.3%).
A

V

$12,177,682 increase in total net

assets

recorded by Television-

was

according to its annual

year,

President.

The increase

fiscal

was

the largest for

in the Fund's history and

boosted

to

net assets

with

assets

net

No.

net

of

Sep. 30,'51

«

-

Total

on

the

1,619,318 shares outstand¬

on

Oct. 31, 1952 from $12.91
on the 758,445 shares out¬

ing
a

share

standing
The

Oct. 31, 1951.

on

listed

report
in

/ferreds

73

common

three convertible pre-

stocks and

the

and, all

portfolio

represented investments in tele¬
vision, electronics and radio com¬
panies or in companies-within th£
of

~

field

the

1

branches

several

shsr outstdg.

Net asset

3,159,633

(amount

3,504,511

*$11.01

val. per sh.

Unrealized

t$10.87

apprec.

by

market

val.

curities

owned

of

on

se¬

from

of

55c

per

tAfter

net

$5,673,061
share

payment

capital

from

of

30c

gains.

Dividends to

during fis¬

cal 1952 totaled 60c per
share, the
same
total as that paid by "B4"
in each of the three previous fiscal
years.

Some

58%

of

the

amount distributed from net

end

gains at the
was

1952

accepted

in

fiscal

total

capi¬
year

shares

of

"B4" stock at net asset value. Dis¬

its fiscal year,

showed,

realized gains
sales of investments of $373,undistributed

undistributed

income of

net

and an unrealized in¬
appreciation
of
$1,-

$194,486;
vestment

964,964.

(from

net

$0.5515

a

income amounted to
share and distributions
gains on invest¬

from

realized

ments

$0.4585

There

limits to

a

share.

predictable upper
the continuing growth of

are

no

the electronics industry,

told shareholders.
that

Mr. Tripp

He pointed out

applications of electronics are

growing

much

faster

on

a

Fund

along

the

way

A

monthly pur¬
buying
shares,

during

its

Diversified

Investment

Fund

W.lllKn
—[★★★★★★ *_**

Prospectus upon request

now

plan.

three

of

<•.

During the fiscal year dividends

shareholders from

net investment income

,

statement

financial

690;
$6,244,335

,

The Fund closed

the
with

ex¬

<! "After
payment
neti capital gains.

tal

electronics.

which

ceeded their cost)

share

Sep. 30/52

,

assets„__$34,792,285 $38,110,343

a

The fund has toppled records all

This
of

$9,792,619 a year previously, v; i
In
the same period net asset
value increased to $13.57 a share

in¬

accumulating sizable investments
as little as $25 a month under

high

of the

Oct. 31, last.

on

year

new

a

at the close

diversified

are

re¬

transmitted to shareholders
Friday,
by
Chester >D.
Tripp,
port

'

professional

1,850 shareholders

The

ago.

mutual fund
a

-a

report shows 8,174,066 shares out¬

compares

period

reached

too,

high of over 34,500, a 34.7%
increase over Dec. 31, 1951, when
new

and

Parke, Davis & Co.

selected

on

$42,-<

in¬

for

Street

at

management they couldn't afford
as
individuals.
Last year, Texas

$23,734,176,

a

stood

assets

sharehold¬

comparatively:, small

because it gives them
list of holdings and

listed at the beginning of the year
and the Sept. 30, 1951
figure of

shows

beginning

net

vestors.

made to order for small investors.

earlier,

stock

has

investors'

investment

officer of

of

growth

per

with

this

traditionally

mutual

year.

the

months

accepted

was

common

shareholders

to

.

Fund

reported

1952

amount

.

regional blue chips showed
of the best performances in

the

when

of $21,970,301

year

industry, electric utili- '
V .' ;
' -.'"V

Last year, Texas Fund's collec¬

30.8% increase
of the year,

represents a

over

Electronics Fund in its 1952 fiscal

Keystone

v7
the

tion of

This

capital gains

"SI"

investments.

portfolio

The

fund's quarterly report. Compari¬
son
of the Sept. 30 figure with

$27,736,444

total

net

all-

an

at the
31, 1952,

Oct.

business

of

any year

stock

common

ties, and chemicals.

ers

Investing's

to

of

value

vestors, attracted to

BROAD

A Mutual

the

the

assets, come,

dustry.

accounted for 97.62% of net assets

to

in

oil and gas

one

common

of

Chemical

bonds

net

Largest investments:|are in

the

The fund

the

eliminated.

$146,649.25,

Fund's

close

reached

$55,576,057

of

for

October,

of prominent

rest represents proceeds from sale
of shares.

The report points out the benefits

invested in
State.

Texas

Commonwealth

of

Co.

England Telephone & Tele¬
graph Co. to the "primary list"

the

the first portfolio.

up

rise

a

National

at the

Address.

City

sale in

group

market value of

a

Now,

investments.

in

stock

value.

lied

total

received in the past of
such distributions.

D-t>4

on

of

stocks in the fund's porfolio*

appears

shares

added

businessmen, who now
directors, founded the
Thirty-one
securities,

as

made

a

Shares

assets were $11.91 compared with
$12.36 nine months earlier.

will

the

dollar in¬

a

New

the

realized gain

of

Portfolio Changes:

domiciled

portfolio.

inc. "A" 41/2S,

gen.

ASSETS

gains industry

ending Sept. 30, 1952, the trustee

69

Co.

RR.

according to figures just released.

Sharehold¬

or
doi'ng
substantial
business in Southwest, principally
in Texas, are included in Texas

of

$10,060,000.
Roughly
$1,274,600 of the climb stems from

It

The Keystone

from

1952

approximated
the
in
fiscal
1951.

of

September,

in

asset
,

stocks

$27,150,752
reported at the beginning of the
year. On a per share basis, net

any

50 Congress Street, Boston 9, Mass.

an

fiscal

last six months of the fiscal year

venture.

Board, shows
$28,615,799.
This
increase of 5.4% in

of

assets

$1.70

concerns

with

net

in

oldest

years.

Common

capi¬
from

payment
60%

distributed from

growth that rapid in their

a

net

capital

shares

which

dollar

largest investment trusts can't

boast

reinvested

additional

Some

nation's

of

during

received in fiscal 1952

mu¬

a

the

Fireproofing Corp. conv.
5s, 1952; Seaboard Air

deb.

gains.

who

ers

come

Even

$1,019,860

from

capital gains in 1951.
in

investment companies.
Texas Fund had "galloped" from

years.

$2.31

that is directly attributable to the
substantial
payment
from
net

tual

net

represents

*

$965,342

$1.48 per share, com¬
pared with $1.58 per share in fis¬
cal 1951—a per share reduction

in

"A"

" t$33.74

amounted to

for

record

new

a

this country's

among

*$33.18

payment

income

ment

mutual

million

$10

capital

tional
inc.

Total dividends from net invest¬

not

business

only

tAfter

inc.

RR.

493,826.

fund in the business which invests

and Chairman of the

eystone

net

of

Maine

&

Boston

4V2S, 1970; Hotel Waldorf-Astoria
Corp. non-cum. inc. 5s, 1954; Na¬

time^ high

cost)

payment

tal' gains,

list:

Investment

owned

their

The

eliminated from the primary

were

NET

132,501

Fund's

was

F.

assets

125,507

(am'nt

sees,

"After

strength.

fund first went
NINE MONTHS'

of

exceeded

"primary list" for
following issues

the

to

investment.

Sep. 30,'52

$4,164,562 $4,470,215

outStdg._

value per sh.-.,

apprec.

val.

they

Beaunit

(subord.) 5s, 1972, and Bush
Terminal Bldgs. Co. gen. inc. 5s,
deb.

2016.

/'SI"

by which the market

do not appear to indicate near
ap¬

of

of

shs.

Unreal,

admittedly there are
signals on the economic

outweigh

America

FUND

assets-

net

of

Net asset

America

Gas

and

stocks

during the

*

Total

re¬

added

1952, the trustee
Mills, Inc. conv.

Sept. 30,

Line

while

danger

the

the

Sep. 30,'51

ac¬

the

shows

during

and

Fund

for the main¬

was

general

high

the

KEYSTONE

reasonable to extend this prospect
well into 1953. He went on to add

bonds of Missouri Pacific Railroad

Co.

statistics
of

fiscal year:

wholly in stocks of companies
operating in Texas and the South¬

Power &

no

portant
growth

Board Chair¬

F.

Randolph noted
stated in the Corpora¬

as

ending Sept. 30, 1952.
following table gives the im¬

the fiscal year

six months of

a

year

The

business condi¬

keep

ended

1982,

"SI,"

portfolio of 42 high-grade
common stocks, has
just issued its
report to shareholders for the fis¬

1952.

Commenting

the

fund.

had 7,292 shareholders own¬

come

66

of

with

proach

Corp., and South

worth

an

rock

Gas

is around

now

original

to

holders

share¬

for

it convenient

make

to

last

Net

year.

KEYSTONE Custodian Fund

TEXAS

&

assets

one

gains
value

ten

to

way

capital

net

usually declared in additional

the

but went

the

from

tributions
are

shares of stock at net asset

that amount of
their capital at work in the fund.
Portfolio Changes:
During the

mutual

Corp., Gulf States Utilities
Co., Lily-Tulip Cup Corp., Sham¬
Oil

just

value

months

12

in

million

in

Investing with
investment policy stressing in¬

the

Stores

any

fund. Broad Street

the

to

during

three months ended Sept. 30. They
were

the

of

gain

the

increase of 225,212 in the out¬

horizon that call

Of these 113 securities five

Fund's

in

three

starting
other

a

by

million,

half

tion's report for the second quar¬

each

Fundamental

based

assets
an

were

with 31,676 on Dec. 31 of last year,
a

Please send

five

months

nine

in

report, one factor

months,

unmatched

mil¬

just

it has since picked up
momentum. It took two years to

the

to

first

in

And

reach

According

FUNDAMENTAL

Account

GENTLEMEN: At

half

second

OPEN-END

Investment

me a

a

Its

reached

fund.

By ROBERT R. RICH

Open

epon

was

and

Mutual Funds

Investment

An

existence.

lion

National

Thursday, November 27,1952

...

Lohi), Abbett & Co.
New York

—

Chicago

—

Atlanta

—

Los Angeles

per-

Volume 176

Number 5172

The Commercial and Financial Chronicle

...

35

(2047)
.centage basis in the industrial andcommercial fields than in the
.

amazing
growth
of
And .he-" added
that

tainment

.uses

.™E

nori-femer-

-

♦

Ol

the

television

industry

are now
enjoying
sharp contrast to
conditions prevailing a year ago.
A significant
comparison can be

the

Oct.

on

Sharenok.ers

^

J^pON^je^iton-as,of

security exchange; tariffs and trade pref¬
erences
and discriminations; ex¬
1952.

27,

increased

from

"

of Oct. 31, i951 to 110,486

from

34,162,750

47- tions

to

*«-• r

has

company

.

naa

substan- shareholders.

ee**

.

tially reduced during the. market published
^
SU1?mer' ls Presently tution we

inventory figure

Useful

made to the

are

contribu¬

solution of

trade problems and the improve¬
be ment of commercial relations with

grown to

.

wr*lcn

port and import quotas, and others
of a wide variety which are con¬

Qct. 31, 1952 and shares out- stantly arising.

standing

.

realized

net

Iea OJJ*
a.,re?u} ?
the
fourth
largest
.investment
Purchases, the Fund s mteriman- company
^he country," writes
Yfsxm0
JeP°rt stated, the per- jj I. Prankard 2nd, President. "It
6
hold- has the second largest number of

in

from

$^38

£

Mr.

sion set makers

drawn

;

a substantial purchaser of --com-sy 177 414
mon stocks during the recent mar"Our

Tripp said: "Certainly the televi-

well-being

miles'.^. ^ '-

*und^reported Nov. "25 that lLwas

eventually

'

;

.

millions of

of

profits, paid

r

*s

overshadow electronics for entertainment.

in

ured

..«w

meas-

television.

will

•

is measured in thousands of ;tribution

wave

miles; tomorrow it will be

en-

.

Based upon statistics

by the Brookings Insti-

foreign

countries

oy

commit tee

meetings with outstanding diplo¬
matic

business

and

representa¬

in

the

of

summer

unsold

Today, most dealers'

and

sets.

distributors'

stocks

minimum, orders
cated

and

cil

manufacturers

at

are

the

in convertible seniors.

a

AMfcKltAN

The report

alio-

hands

approximate

of

of

countries

and

with

specific

areas.

addition to its

good signs of
tinued demand." ~

this

gave

shifts

recent

common

improved earnings prospects
increased.

con-

ican

L

These

included

Tobacco,

Corn

The-Fund executive singled out
the field of microwave
equipment
and its applications as how a
segment of the
industry can be ae-

General Foods and
Gamble.
•.

veloped.

Gulf

1950.

He recalled that in .Tulv,

only

wave

and

1,900

miles

of

systems had been
a

pointed
total

that

out

had

last

passed

June

20,000

He

£7/ie

from

the

p^r0

commons

and

such

Pennsylvania

undervalued

Others

Manville

were

favorable long
round

like

for

v

.

were

which

discounted

common

made

THE

of

their

FISCAL

year

of

capital

were

$72,798,191, the largest

volume

annual

of

At

Quarterly Dividend
20c

o

shore from

45c

a

share distribution from securities

profits.
stock

ordinary income, and
December

Payable

of

record
♦

December

29

to

5, 1952.

WALTER L. MORGAN, President

Philadelphia 3, Pa.

the

sales

$12.73

at

Sept.

30,

r?f
J lI*f
lacing,

*

«r

jW

^

+

of

an

Co.,

??

u

Net

Fund s policy

primary emphasis
directors
near

feel

on

asset

value

of

each

share

future."

from

4.

to

*A

$4.65

nA

$4.74

increase

^

on
was

Continued

Oct.

on
ot

x

Oct.

31,

after

from

a

31,

frx-ro

1952.
12

cent

page

1951
mu■

This
dis-

in

Foreign

KEYSTONE

fnCt>

has

Mr.

0f

CUSTODIAN

announced

Camerson

Bank Group Shares
Insurance Group Shares

and

S.

the

Funds,
election

Thompson

as

member of its Board of Difetors. Mr. Thompson, a graduate
of Tufts College and a prominent
.New England executive, is VicePresident and Director of Jordan

10

Keystone

general operations of

of

the

largest investment

re-

one

??arch and supervisory organizaR°ns, currently supervising cornbined investor assets of more than
*200,000,000.

3

Investment

(Mutual

Funds)

of

Institutional

Distributed

HARE'S
19

RECTOR

NEW

YORK

Ltd.

by

LTD.
STREET
6,

N.

Y.

'

Prospectus may be obtained from
the above or local dealer.




public

Activities."

These recommendations
result

of

various

studies

are

the

by the Council's

Committees,

reviewed at

which are
the monthly meetings

The

is

Merchant

Marine Committee

composed of steamship people.

Well founded experience

similarly
qualifies the Law, Treaty, Inter¬
national Finance and Travel Com¬

mittees,

Board

of

Directors

of

the

Tax Committee is made up of men
who handle matters involving

taxation
trade

or

of

income

from

foreign

business the year around.

national

and

years.

interest.

investors

in

country benefit

the whole nation¬

serves

segment of business which

ingly

seem¬

is

wholly
domestic,
but
which to a greater and greater
extent is dependent upon imports
of

of

some

the vital materials

it

requires for its continuation and
While

and

the

the

vigorous

advancement

pro¬

of

the
our

country as a whole and serve as
a guide for the Council in its ac¬

but

once

cisive strokes.
The second part of the Declara¬
contains
individual recom¬

tion

mendations on many specific
questions of foreign trade policy,
practice and procedure. Both sec¬
tions of the Final Declaration

referred

by

all

the

throughout

interested

views

States

the

to

of

vital

issues

the

are

year

determining
of

United

business

on

involved.

The theme of this 1952 Conven¬
tion is inspirational in a practical

way—"A

Better

Increased

Consumption."
lieves that

achieved
lateral

World

Through

Production and Wider
Thd

Council

better world

a

be¬
be

can

only

through a multi¬
system
of
international

trade based on the principle of
free, private, competitive enter¬
prise. It believes that only
through increased world produc¬

tion

and

the

fruits

wider

a

an

reach the

men's

distribution

ever

production
growing number

population

can we

goals towards which all

eyes

are

turned.

Continued from page 5

bullish

they

one

Committees

the

are

it**

•

•

of fortunately building-up a pent-

means

demand.

up

War-and-peace

news

furnishes the clearest example of

a

ve¬

hicle affording opportunity for directly contradictory conclusions.

bearish-interpretative

purposes
there is the Cassandra-ish
for business. In a bullish atmosphere, contrariwise,
"constructive." Likewise with prospects for, or arrival
of war: its inflationary attributes can make it bullish, or alterna¬
tively, its tax-raising and generally "destructive" attributes may
make it construed as a bearish explanation.
scare

is

The Stock

This

double-talk

Scarcity-to-Plenty Seesaw

also is recurrently manifested con¬
the status of the supply-and-demand balance of stocks.
One of the popular justifications for the 1928-'29 propulsion of
stock prices into the stratosphere and the "stocks-are-cheap-atany-price" credo was their scarcity value; there could never be,
enough good stocks to go around. But not long after the cataclysm 7
of October, 1929, the same people were certain that with the na¬
tion's banks
popping-off there would never-never be buyers
around to pay as high as 10 of their scarce dollars per share for
such "drugs-on-the-market" as General Motors, General Electric,
Sears Roebuck, International Nickel and other Dow-Jones Average
leaders. Thus it followed that price earnings ratios in some cases
process

cerning

first

to

rose

100

and

then

fell

to

V2

of

1.

<
.

Coming down to 1952: during the declining-sloppy market of
last month a
young customers' broker attending
an
investing r
course twice rose to picture his profession's doom because of the
activity-emasculating tax situation; the high levies on current in¬
come
confiscating new buying power. But—this week after the
market's 10% advance, our man rose to report the new worry of
Now there's a shortage of "good" stocks for
which they have meanwhile somehow found.

clients.

their

Inconsistency in the public's attitude is also clearly demonin the chameleon quality it has been attaching to the insti-"
tution of the holding company. Midst the roaring '20s this device,
formed for a variety of speculative purpose, per se invariably com¬
strated

manded

market

a

and three times

as

price implying that the whole is greater—two
Twenty years later

great—as the sum of its parts.

prevalent investing credo holds that the whole is worth less—by
10 to 40%—than the sum of its parts; even in the

discounts from
of

case

of

clear

close

public utility holding companies breaking-up to the tune
mathematical calculation, and under the rigid aegis of

government supervision.

on

An

Opportunity for Constructive Exploitation

Fortunately, realization of the above-indicated foibles can be

and Industrial

problems which receive the atten¬

turned

to

highly

are

those of basic economic

conditions; international

currency

constructive

use

in

one's

investing

behavior.

Recognition, via inquiry, of fallacy in the public's controlling rea¬

soning is
sions

as

highly valuable tool for validating one's own conclu¬

a

to

a

specific security's under- or over- valuation based on

quantitative and other sound criteria.
And recognition

in

news

of the above-cited psychological aberrations

interpretation

concentrate

on

the

tion of the country and area Com¬
mittees

of

such

of

occur

year,

in

leaders

International

of the world's

conventions

the Council is a
institution,
and
the

a

The first part of the Dec¬

customarily sets forth a
position regarding overall foreign
economic policy in broad and de¬

among

these

Government Controls and Regula¬

tions, Industrial Relations Abroad,
Property.
Council.
These proposals derive
All the Council's country and
their soundness and strength from area
Committees, which deal with
the fact that they come from prac¬ the
Western: Hemisphere,
Euro¬
tical
business men -who are pean, African, Middle Eastern and
broadly experienced in the vari¬ Far Eastern countries, as well as
ous
phases of foreign commerce those of the Sterling Area, are
with which each particular com¬ possessed .of the same
high and
mittee deals.
For example,
the practical
qualifications.
Among
of the

Sharts,

wider

a

on

wide foreign trade community. We
feel the Council serves even that

his

through special statements and
through the Council's "Summary
of Current

Stock and Bond Group
Shares

to

out

its office is located in New

York, it

peace

Growing Importance
01 Foreign Trade
Members

carried

the Council's activities.

money,

Aviation Group Shares

the

traders

a

country's

at

and

foreign economic interests of

of the Council is di¬

all sections of the

from

For

PROGRESS

As trustee for the

of

work

rected

assets

Af-

of

informational

been

peace

PERSONAL

aimed

tection

Observations.

"should continue to be fully in-

sponsors.

assets

capital stock increased during the
year

The

u

shareholders

?

vested for the

decisions, pro¬
Final Declaration,

claimed in the
are

that fol¬

year

Convention

q^

funds, Keystone Custodian Funds,
filiated
Fund
were
$223,470,374 Inc-> is responsible for the specific
compared with $158,818,398 at the investment policies governing each
end of the
preceding fiscal year. of these funds as well as for the
year-end,

has

increasing scale in recent

an

w

"fu I?

gain,

on

a year

investment

according
Lord,- Abbett &
92nd Consecutive

its

company'."Marsh Company, Boston, Massaby investment dealers/ chusetts,
and is a Director of
to an announcement by Goodall-Sanford, Inc.

ope n-e 11 d

made

tnt Tn

flt

?>

to

Affiliated Fund Inc., which ended
Oct. 31, 1952, sales of its

ever

on

of

large¬

appeared

most

to

p,,-. j

capital
.

principal

issues

DURING

mvio

in

expected improvement
earnings and dividends.

stock

function

foreign trade and

This

investment.

continuing

their

near-term
in

close

earlier,
while the number of
outstanding
shares increased to 172,983 from
121,029.

de-

investment

.

n

in

the

1952, against $12.55

term outlook and

the

,,
Fund s

have

1952>

Fund

$2,201,872

de¬
own

auvaiicenieiit.

Aluminium,.

bought

-

out

stock reductions

ly

Concord

to

American

amounted

were

or

thpep icqi,p«?
'
"

The

30>

of

fect

year, from $1,518,422 a year
according to the annual
report. Net asset value per share

RR.

Ltd., Atchison, Topeka & Santa
Fe, Illinois Power
ahd
Johns-

< rvwvwwwwwwww w v w wwwmww*

increased

figcai

Cela-

as

purchased because they

pressed.

Street, Boston

ASSETS

jnCt>

Chesapeake & Ohio,
Macninery,
McKesson
&

considered

to

.

on Oct. 31, 1952.

Corp.,

were

,

concerning laws,
and regulations of our

foreign governments which af¬

thRead^°? .While

w?-

Sept

up-to-date and accurate in¬

crees,
or

earlier,

Robbins

FUND

common

a y

NET

and Pittsburgh

s*

nese

50 State

such

possible change in
taxes.
These
included

a

Food

Putnam Fund Distributors. Inc.

J*

iriternk-"^^^

comprise 51.23%
excess0 an^ 0Ci°
0n

Some

ol •ffjoiton

tlscaLyear

•„

Chrysler, General Electric, Westinghouse Electric, Union Carbide
& Carbon, Corning Glass National

*

PUTNAM

—

increasedP/ff^^jH'

a

Seorqe

v'?

andZ^ I?? Radiator &

profits

miles,

"Today," he commented, "micro-

|he end of the company s

'

Oil, Socony - Vacuum
Company were
So, too, were stocks of a number
of companies which would benefit-.

autnox^ea

later 9,800 miles.

year

equiva-

Proc^"^^
.Tiiansnussmn 3 /8%

Texas

micro-

with

.Cbl^Par

per share, on Nov.

Amer-

Members

Shares formation

$35,411,499,

■

were

its

ou

fh

.

suoolying

BUSINESS

<

Products,

Holdings
of
several
tional oil common stocks

of

„TTCTKT1?C!C!

i1™' reP?rt® n^.as^® °f $37,748,10*0° $3-90 per share,

summary

in

duty

and tobacco companies with

soap

%

are

the

effect

laration

concerned

are

with

stock investments: Stocks of food,

80,-

000.
Not only is demand outstripping supply at the moment,

there

Fund."

successive Conven¬

continuing

throughout the

lows.

who

In

bonds and preferreds; 9.75% in
governments and cash; and 2.21%

million

being

are

in

sets

two

a

tivities.

1951.

close to

of each
has

the regular activities of the Coun¬

entire

dealers held

but

tion

tives, both American and foreign,

responsibility
f
*0 ^
estimate that one out of
aDOUt bJ/0 01 resources.
.
-every six owners of investment for liaison between the national
industry
combined,
The remainder is diversified as company shares in the United foreign trade community and the
manufacturers, distributors, and follows:
24.70%
in investment States is an owner of Affiliated Government, the Council has the
reached

The

work

and relevant to

pretative angles.

should

stimulate

the

investor

reader to

phases of financial literature that are factual

value, in lieu of its forecasting and other inter¬

0

36

The Commercial and Financial Chronicle

(2048)

from first

page

higher selective market, especially
since there has been no period of

An Inviting
market

ers,

least

at

to

the

that

extent

it

would take strong and convincing
evidence of some other fact, as

distinguished from

opinion,

mere

to justify a departure from it; for
under those circumstances market
value

is

not

tion

composite
opinion of many persons making tion, the spread between bonds
and stock yields is close to 3%.
ap intensely practical appraisal in
their own interest—it is actually On the basis of these few statis¬
merely

a

tical figures alone, it would ap¬
willing
buyers are
willing to pay and pear that the market is not too
willing sellers are willing to ac¬ high and even has room for a
further advance.
cept, and no appraiser and no
court can get closer to a deter¬

factual

■•a

of what

report

mination of value than that."

Recession-Consciousness

of

appraisal of the basic eco¬
nomic conditions, we have never
In

Making Market, Appraisal

jparts

this

three

first

the

basing

and

into

talk

two

pirts on this Judge's recent opin¬
ion,

shall try to correlate it
present phase of the

I

with

this

market's

action.

First, the Judge

said that "market value is

posite
.«

making
their

*'A

of

opinion

appraisal

interest."

such

an

must

be studied.

appraisal,

outset that

ing in

a

many

let

we

time when

me

we

ahead,
confusion

say

liv¬

all

are

-uncertainties

shattering
predictions

in
making
factors

In

But

at the

persons

many

practical

a

own

com¬

a

see

many

precedentand
dire

of things to come in
1953, and that tends to make all

of

postpone decisions, expect¬
a little later the outlook

us

ing that
will

be

much

clearer.

.tends to bring about
ation
in

rather

This

also

undervalu¬

than

over-valuation

security prices.

But when the

outlook becomes much clearer the

opportunities for profitable action
diminish.
born

Most opportunities are
periods of bewildering
f

in

confusion and turmoil and I think
too

of

many

us

right

are

now

wearing the dark glasses of yes¬
terday.

I,

for

tunities

they

believe

one,
are

just

ever were,

ment

of

as

as

better

postwar

a

little

eral

business

these

various

conditions.
factors

How

1950

and

remained in

U.

S.

Smelting

34-40

narrow

a

range

share.

Chartist

This

leads

,

;

.

,

.

.

the

to examine

me

U.

ously

a

S. Smelting was obvi¬
highly speculative issue

at that time.

Yet

examination

an

of

and

weighed

here

us

279-286

are

well

are

vary

on

of.

At

the

aware

Dow-Jones,

assem¬

may

In¬

already authorized Certificates of

pipelines

have

and

been pretty well
productivity is so

that

great that a highly competitive
period lies ahead. Also they warn
that

while

doubled

have

sales

of

termination

than

value

that.

investors

of

willingness

to

buy or to sell has absorbed the
painstaking efforts ,of studious
followers of the market for many
years

that

accumulation

indications

gave

to

vance

in

of

this

The shadow of

stock

price

a

least the

at

things to

ad¬

level.

65-67

come was

there. It took courage to buy, but
the stock later doubled in value

cipher

will

be

the forerunner

of

a

fur¬

constitute

some

which

into

go

of

the

earnings.

a

little

over

11

times

making
appraisal.
The

The last time this

aver¬

of

judgment

in stock

all

to

17

price-times-earn¬

We

a

and

well to

Book

value

excessive.

has doubled

these

on

Dow averages in the last 10
years
and
has
also
doubled
in
such

leading stocks
eral

Electric,

Johns-Manville,
N.

J.,

General

-Roebuck.

du

Pont, Gen¬
General
Motors,

as

Standard
Foods

and

Oil

of

Sears,

With declared dividends

already 3% higher than last




violent swings

times out of

many

to

price of a
projections

the

which

true
are

busi¬

finally

service

of

This

for

each

confidence

investors, and

cause

already caused them, to feel

much better about

investments

and

common

take

to

a

stock
more

positive instead of negative ap¬
proach to their investment prob¬
lems. While no one, least of all
businessmen and investors, should

expect miracles from the new Ad-

ministration,
look

can

assing

nevertheless
they
lessening of har¬

J

for

a

tactics

by.

■

governmen

and sounder security value

omy

where the market could get ba

its former

to

basis

earnings. In such
of

renewed

out of

come

competition
in

1953

have

of

evaluatin

atmospher
confidence, ventur
dormant is likely t
hiding. Granted tha
will be more sever

capital long

an

and salesmen

to

get
doorbells, it

will finall

and ring
seems to
me

out

som

fro

what I read that the business ap

plecart -is rolling 'along on
pretty strong pair of wheels an
ought

able: to

be

to

chase while in the second instance

severe

the

considered

the

of

to

me

the

once

strength
It

that

I

A

attitude

comprehend
and

at

weakness

tools, employed

chartist.
me

judgment.

detached

and

permitted

by

the

clearly evident to

was

other elements

needed

to fill the gap

cepts.

in my market con¬
These I found in the basic

research of the economist

the

on

hand, and the serious work of
the
analyst on the other.
My
one

widened vision relieved the

which

under

of

scorn

had
previously
experience
was

I

My

charts.

42

and

and

showing

severe

take
jolts;without
;.■•••• : -

som

We

to

came

be

tol¬

many

revealed

taneous reaction in the market as

that

by charts and suggested

careful

a

research investiga¬
appraisal should be made.

tion and
It

must

be
pointed out that
stocks,
despite
excellent
earnings, generous dividend yields
many

excellent

and

will

for

range

Such

point

a

patterns,

very

narrow

long period of time.

example is Otis Elevator

an

which

a

technical

in

remain

has

remained

range

in

trating dormant action

four

a

for two years,

illus¬
result

as a

to

every

decline

in

stock

prices

a

one

here present

road

to

cast.

Remember that truth

better

lies between extremes.
error

are

one

and the

turn

earnings
the

was

corner

beginning
and
point

always

Truth and

same

mani¬

festation, being different only in
degree.
Many charts of various
kinds

in

used

are

studying

the

daily

scientifically
buying and

a

story

and

providing
the

to speak.

best

an

are

it

up.

If you

believe that

are
we

one
are

at

53,

over¬

This October

80.

40%

decline

in
months. Certainly the assets,

earnings

a

value of this

book

and

haven't shrunk 40% dur¬

company

what

and
most

is

this

ing

short

earnings

value,

prospects

whichever

statistics does not always turn out
to be the correct one.
Charts in

prefer, have

a

sometimes
provide the
of things to come and do

doing.
Let

are

that "technalasysts"

the

cite two brief

li

staggere'd

a

up.

In

various

the

teresting

to

groups

it is in¬

that since the
prices of the air-

note

first of the year

crafts, automobiles, e 1 e c t r i c a:
equipment, food products, radic
rallied

substantially

22%

as

tobaccos have

television and

and

vision

as

and

as

higt

in the case of the tele¬
the other hand

On

stocks.

chemicals, farm
equipment,
retail
trade,
drugs
liquors, sugars, textiles and steels
the

airlines,

have declined and
in

the

as

much

textile

of the

case

as

bull

the

market

to

end

this

21%

stocks

It would be most unusual for

this

way.

Ir

of the market it
supporting stable buying in¬
fluence
of
the
pension, profit-'
background

the

Sharing,

mutual,

trustee and life
are purchas¬

insurance funds that

ing rather sizable amounts of so-j
called "blue chips" on a more oi
less permanent

likely
will

basis, and it seem^
this type of buying

that

soon

be

forced

list of approved
Additional
I

cannot

widen the

to

f

securities.

Investors'

but

help

Money

think

>

j

that

investors' money

market

for the

The

election

new

era

to

with

where I
so-called

this

which

Market-wise,

cases.

back

come

forecast, and here's
really get back in the
a

you

Forecast

we

a

practical started

"se-

about higher prices, perhaps ever;
rather violent movements in some

finally

outlook

or

word

place in the invest¬

Market
Now

jungle.
me

gone

and

ment field.

sellers

past

rolling
and twisting readjustment withir
groups.
Through all of this the
averages
are
selling right back
at their top area, yet approxi¬
mately 52% of all the stocks or
the big board have gone dowr
during the year while 48% have
but

months,

going into equity investments dur-j
ing the next few years, that this
by
itself will
gradually bring

curiticians"

reveal what buyers and

the

during

simul¬

sell

lieve

faced with

no

with billions of

ob¬

hog,

whole

a

merchandising

and

There has been

other statistics. That is why I be¬

and

news

steel

shares.

than just a close scrutiny of book

on

shadow

declining earning trend next year,
year, you might bear in mind that there

above

helpful in

money

to

of those who
a

sold

seven

higher, but stock prices collapsed; this type of market can .be to the
or, we might remember the early investor what a compass, is to a
part of 1949 when earnings began mariner. (Charts, like the. ground¬
to go down and the market started

period of distribution and

valuation

of the oil, chemical, copper

lead,

tical appraisal" of something more

very

insight

time

a

They do tell

putting their

so

spring it was clear that U. S.
Smelting had been going through

on

selling habits of the thousands of
investors

last

period. What has
shrunk is the willingness of buy¬
ers
based upon "intensely prac¬

buy
versa.
Sometimes the
Yet, it might be stocks.
again recall 1946 when the vious interpretation of

of

the

as

analysis and fore¬

vice

trend
to

analysis is

in

readjustments

price

justification and reason were
apparent. In both cases the shad¬
ow of excellent market action was

erated, but toleration in the final

the line

all prone to believe that
decline in business profits will

ings ratio has been quite normal
considered

com¬

are

and

not

a

published.

cause

15

prices,

figures

ness

a

a

future

cause

proportion

past

was

of

posite of thousands of independ¬
ent
judgments on these varied

selling at this level was
in 1930 and the price-times-earnings ratio was over 20.
In the
age

elements

the

These

selling

likely to

ions and refined my

shared with other serious students

collapse in the business pic¬
While historical precedent
is usually of doubtful
value, it
might be recalled that the great¬
est period in the history of nor¬

stock.

is

is

has

mistakes have tempered my opin¬

40

matical formula

ture.

<earnings, while 10%
1951, are estimated

than

value

received.

pretty

struggled.

determines the

lower

the

dollar

remark¬

ther

factors

at
$24 for
dividends of $15 and a
yield close to 6%. Hence the Dow

in

^

practical

with

restoration of
business con¬
fidence end eventually confidence
a

.

dustrials, and with apologies to
Harry Comer (as I am using one
of the misleading stock
averages),

1952

highlighted by
ideals,

American

part of the Judge's

of an almost equally divided ap¬
praisal of the company's future by
limited term since it
greatly from analyst to analyst
willing informed buyers and sell¬
mal business prosperity came in only permits what it cannot ap¬
and from company to
ers. Also many times market value
company.
What the chartist desired carries to excess because of the
The one goal we all have in com¬ the '20s, and from 1921 into the prove.
'30s commodity prices were in a was acceptance, and he began to
mon is a projection of the effect
continued willingness of buyers
stable
to
of these factors into the future of
declining phase. Per¬ experience it the moment he em¬ to buy from reluctant sellers. The
braced the good in other tried and
anywhere from at least six months haps this is not a fair compari¬
market value or price of a stock
son
as
government support has respected methods.
to several years.
also
often changes
dramatically
been, and is now, an artificially
At this point he became a "tech- and
drastically over very brief
Today's Market Factors
stabilizing factor in most farm
nalasyst" — a coordinator weigh¬ periods of time, so that constant
These are just a few
Let's try to examine just a few products.
ing his own conclusions and in* supervision to determine under¬
of the broader factors which exist of the things that we read and
or
over-valuation
is
corporating other informed opin¬ valuation
hear about on all sides and which
in the market today which most
ions.
I can commend this course rather
necessary.
For example,
bled

be

opin¬ of the price action revealed very agencies toward business, a tren
ion, namely, that market value is strong buying taking place in the which should prove constructiv
a
factual report of what willing 34-40 area. A careful study of the in and by itself. Even an anti-in
buyers and sellers will agree on point and figure charting method flation policy by the governmen
and no court can get a closer de¬ which I use among others, showed should make for a healthier econ
second

cannot reduce to an exact mathe¬

completed under

even

management and re¬
search, and last but not least gen-

^}

except, in isolated
While I believe it is safe

more

it-margin,

1949

of how I actually used
good advantage. Back

col
anything so vari¬ able resistance to all
"
market de¬ lapsing.
able as the buying and selling of
clines at that level. The shadow
The
market
in terms
of th
Necessity;
that
inventories are securities
by human beings mo¬
now about in line with the general
again was in evidence and showed averages has been selling in a
tivated by different opinions and
the technical base for substantial 18%
level of business; that disposable
price range for the past.tw
purposes.
' ;
income has held up well regard¬
appreciation, but this time investi¬ years against a 45%:, price rang
less of taxes, and that accumu¬
With your indulgence I shall di¬ gation revealed the fact that a the previous two years 1949 an
lated savings are large and should gress for a moment to remark that chiclet gum with chlorophyll add¬ 1950, so the major trend toda
act
as
a
bulwark
against any I sense a growing regard and re¬ ed, was becoming quite popular might best be described as side
sagging tendencies in consumer spect for the chartist. I can well in the Midwest and promised to ways. But within that narrow
spending.
Furthermore,
reports remember the skepticism which at assume nation-wide distribution. range some rather severe read¬
of
industrial
activity
indicate one time forced him to hide his This gum was manufactured and justments have been taking place
boom levels with the Federal Re¬ labors. JHe developed an inferior¬ distributed by the American and
many businesses have bee
serve
Board
Industrial - Index ity complex that caused him to Chicle Company. The stock of this in a declining trend since 1951
rash
and
unwarranted company has advanced 25% with Witness the substantial price de¬
reaching a new postwar high of make
225 in October.-:.
claims for this or that "system." indications pointing to still higher cline in the textiles, drugs, liquor
AJ
motion picture stocks. An
At the same time, those bear- I ought to know for I was one of levels. In one case there was no and
them. Hard experience and many substantiating news to justify pur¬ since
last spring
we
have had
ishly inclined
tell us that the
that has not been

since 1945 net profit is the lowest
though it may take
for the past three years, and that
shopping around and
this
narrowing spread between
a more
careful appraisal to un¬
gross and
net income carries a
cover
them.
In
making such a
serious threat when volume de¬
practical appraisal as the Judge
referred to, the chief factors usu¬ clines which it will when defense
Many
ally to take into consideration spending passes its peak.
also believe that a continuing de¬
are
earnings,
dividends,
book
cline in the commodity markets
value, current asset position, prof¬

products,

in

to

in their endeavors to de¬
price action. It can only and sold at 87 V2 this year. Sub¬
past
two years.
Yet we have be determined through the medi¬
sequently SEC reports revealed
been
informed
that government
um and study of various kinds of
that insiders were making pur¬
armament expenditures would be
charts. Now, let me state emphat¬ chases in 1950, but in all proba¬
almost
$10 billion higher next
ically that I have never known bility not the general public.
year should the Korean War con¬
anyone
who could forecast the
The other case was even more
tinue; that capital expenditures minor and
major swings in the
interesting. A high grade invest¬
would
continue at - high levels,
market 100%, all claims to the
ment stock, American Chicle, was
mainly because of the tremendous
contrary notwithstanding, for you
selling in 1950 and 1951 between
amount
of
unfinished
business
they have been in the

as

oppor¬

great today

many

so

recession-

been

have

investors

when

time

a

conscious

filled

the

with the develop¬

and

new

witnessed

over-valua¬

or

stocks

The

This

Dividing

chart

a

price
although earnings were only
$1.51 and 16c per share. A care¬
cases.
ful statistical study of the com¬
the yield today is almost twice as and true to state that 75% of the
pany
at- that ' time
revealed
a
in
stock
prices • is
high as it was in 1946 when the fluctuation
rather unfavorable projected
Dow stocks were selling at 15.7 caused by changing fundamentals
indication for 1950. A
times earnings of $13.60, paying such as earnings, dividends and earnings
factor
of
then
unknown' force
out $7.50 in dividends and yield¬ book values, the other 25% usu¬
was
that the company has pur¬
ing only 3%%. They are also sell¬ ally reflects not company reports
chased
105,000 shares of Texas
ing about twice the yield that oc¬ but sudden sharp changes in pub¬
Pacific Land Trust around $29 a
curred at the 1937 top.
In addi¬ lic sentiment and psychology.

over-speculation

Stock Maiket!

controlling

is

value

ample precedent for a illustrations

to be

seems

Continued

Thursday, November 27,1952

...

month

is

an

this

demand

important factor along wittj

earnings and dividends;
Also
amount

seeking

a

(

factor is the tremendou
of

investment

yields

on

mone

which to liv

should ♦Which at today's prices seem m

Volume 176

Number 5172

The Commercial and Financial Chronicle

...

(2049)
attractive.

While

forward to the

optimism

and

bullish

in

as

tively

cannot

we

be

market of

groups ,of stocks made should have a pretty
good recov¬
conflicting pressures and ery from present levels.
Expect
different
potentials.
There
is some excess capacity later in
1953,
nothing wrong with the market therefore would not advise hold¬

past,
position,

selec¬

my

of

up

rampantly

as

the

bullish

look

unrestrained

same

based on except that it has gone schizo¬
a careful
appraisal of all known phrenic on us, which in layman's
lus and minus factors, including language means that it has a
split
technical studies, is offered as an personality, and in your
language
pinion and it might prove com¬ means that it is highly selective.

pletely
arkets
n

which I

wrong

of.

ware

As

You

well

am

have

I

said, bear
not start in

usually

do
of caution

atmosphere

don't

whole,

the

market

as

a

buy individual stocks
I will try and be
specific with

so

and

buy

you

brief comments

various groups

on

stocks
elatively low price-earnings
and
individual stocks
tios, and right now after prob- within groups—from a Technalaof

ble

delayed

ext

two

tax

hen

hould
ause
or

be

of

better

the

egardless

group

of

upward

be-

ever

should

hold

01-102 D.

J.

further
will

rise

the

round

the

to

a

290-295

dicates

as

in

higher.

ent

price action

but

as

positions

ise with minor

Anaconda,

St.

interruptions will

fter which I will be

signs

)f

or

let-down

a

fit

the horizon

I would again advise investors to

each

situation

basis.

nd eliminate any undesirable is-

which

mes

operating

are

on

elimination

are

appear

entitled to

of

over¬

further

a

Expect

in this group

a

a

seasonal

strength

especially if

cold winter.

Since

we

have

it is difficult

:hin margin of profit, perhaps re-

to

3uce debit balances somewhat and

the issues in this group, would ad¬
vise partial liquidation on such

jwitch

into

purchase stocks of

or

companies
that
can
withstand
competition under more normal

Rails

;ive averages, for this will
an
a
lot of things, such

depend

a

candidate for

As

95-97

it

riembered in any

that

constantly

be

must

aarket

Rails.

out earlier in this

pointed

alk,

the

on

the

re-

new

highs for most of

level

conservatively

supporting

iresent

prices of stocks. Actually
nost companies in 1951 paid out
inly 61% of earnings against 76%
a

n

like

year

1937.

looks

It

as

hough they would pay out about
5% this year. Cautiousness that
as
existed has been discounting
decline

earnings for
time. Therefore if downward

ome

should

rofits
sct

on

continue, their ef-

prices is not likely to be

severe

s

these

in

if

as

arried to

the

had

market

extremes

the

on

aver-

Regardless of whatever ad-

ges.

astment is made in the first half
f

next

igh

likely with

in
a

the
good

market reaching a

high above 300, D. J. and as
as 114-115 on the rails. We
have

tiould

953

recovery

a

is

of the

hance
ew

year

half

atter

some

tax

relief

in

and

high preference should
accorded companies that are

e

igh

in

tax brackets,

excess

paying

ecially those

an

es-

overall

ate close to 70% such as DuPont,

lis

Chalmers,

Goodyear

and

Tractor
and
many
thers. With tax relief, companies
aterpillar
likely

re

to

be

more

generous

ith dividends.

icific
low

rket

Stock
no

as

Have

—

term

cate

higher

Standard

Chemicals

—

Have

recovered

Groups and Issues

report or talk on the
end without spe-

should

comments

on

exhausted

and

you

paying too high

shown

excellent

peake

&

out

Continued,

group and is recommended.

Motors—Are also in strong tech¬
nical position.
Chrysler should

these ' stocks

levels.

Trade

—

spending reaches
year as

that

consumer

high next

a new

predicted, it would

many

stocks

If

of

the

appear-

department

Favor

Warner,

Eaton

Products,
Mfg. and

BorgLibby

over-sold.

anese,
Lowenstein,
Burlington
Mills and J. P. Stevens in the tex¬

ment shares.

Papers

strong

—

Are

technical

national

shaping up into
picture.
Inter¬

Paper

and

Kimberly

Clark both indicate higher levels.
Two lower priced issues, St. Regis

jrom

page

—

las and Grumman.

Air-Conditioning—This
indus¬
try should do well in 1953.
For
has had long-term appreciation, stocks in
a sharp
recovery from their lows, this group indicate much
higher
but with the probable elimination
levels. Particularly favor Carrier
of price controls and E.P.T. next for
price objective over 40, and
group

Servel and York

are

also

recom¬

considerably higher. Tech¬ mended in the lower priced field.
position is strong. Advise
Rubbers
Longer term outlook
holding.
is good and position should be
Building — Reached peak last
held, but technical patterns do
year but selective building stocks
not indicate much higher levels
indicate
higher levels.
After a for the
present. Of the rubbers at
further period of reaccumulation
this price I rather favor Goodyear.
many of the secondary stocks in
Farm
Equipment — Should do
this industry should rally. I par¬
better a little later next year, and
ticularly favor such stocks such
so should Meat Packing and Rail¬
as
Flintkote, National
carry

nical

—

Gypsum,

U. S.
vator

and

Crane,

and

road

Equipment, but for the pres¬
they
do ; not * show
much
especially greater appreciation from present

Plywood, Masonite, Otis Ele¬

years,

ent

groups

but has been a




is

over

all the stocks in this
group

purchases

a

of

policy of
under¬

sometimes

can

"Seek

be

what

Remember
for

the

long

time-

Judge

said,

a

the

correct

market

value for

willing buyers and sell¬

ers."

Ken

As

Ward

said

at

the

this book by Zane
Grey, when prophesying the uncer¬
tain adventures of the future, "I'll
never
spring another stunt like
this

of

end

very

one," and

I say, I sincerely

as

hope that these remarks will not
lead you

into

deeper Jungle.

a

people who should speculate, and
there are others, perhaps blessed
with

In

Am I a natural-born money¬
Am I a good trader? Do
talent

have

(There

to

identify values?

relatively poor

some

are

much

more

should

never

dustry should be held, but sharply

who

money,

Some

risks.

take

people have everything to gain
and nothing to lose. Others have
everything
to

to

and; nothing

lose,

gain.)

think

I

Now,

know that sugar

mellow moment he told me

a

that

ago, purely by social
accident, he became interested in
astrology. An astrologer—he says
she was a good one with a nation¬
wide reputation — advised him
years

under that, because he was born under
a
certain
star, he was of the
esthetic type and therefore would
not lose my head when things go
always make money if he asso¬
against me?
Some people who
ciated himself with ventures and
theoretically can afford to specu¬
enterprises engaged in providing
late, get rattled and become a
the finer things of life. For this
pain-in-the-neck
to
themselves
reason, my very successful, quite
and their advisors.
wealthy, retired bank vice-presi¬
(7) How much risk can I afford
dent friend tells me, in all serious¬
(6)

How

I

do

behave

Can I be comfortable and

stress?

Do I diversify?

to take?

For

my

part, I have learned that I
must diversify in order to keep

own

Psychologically,
eggs in one
basket; but if I have lots of bas¬
perspective.

my

of

can't put too many

them

are

small)

(even if some
I behave fa¬

mously and get good results. I have
clients who do better when they
concentrate.

(8)

a

stocks in this group should

making

that most of you.
shares and min¬
ing shares are about as specula¬
tive as anything one can buy. One
day I asked this man how he
developed his peculiar prejudices.

(5)
I

kets and lots of eggs

Allied
Aircraf ts
Stores, Mercantile
Are
presently
in
Stores, Federated and Associated strong technical position indicat¬
Dry Goods. The mail order issues ing higher
levels.
Particularly
such as Montgomery Ward also favor stocks in ths
group such as
look like good buys on any minor United Aircraft,
Lockheed, Doug¬

year,

tience combined with

14

maker?

mend

Tobaccos—This

assured

a

I

variety
stores
also
present
strong technical position.

be

or

cheap for slow appre¬ at 19 and Meads at 233/4, look like
longer term holding.at interesting buys for long-term ap¬
present prices. Therefore recom¬ preciation.
are

The

will

The Personal Side oi Investing

Electric Auto Lite,

ciation and

setback from present levels.

success

act with confidence and pa¬

we

issues in this group

Motor

have favorable technical patterns.
Retail

if

I run into some amusing ideas
has it been a failure?
Is there
anything I can learn from my past about investments. I know a man
who will never buy a railroad
experience?
"
are
Studebaker, Nash-Kelvinator
(4) Am I a "collector" of secur¬ stock because it is too speculative,
and Reo in the truck field.
ities, or just a.trader? I have to but he will buy any kind oi a
Motor Equipment — This acces¬ "collect"
them, just as some of you mining stock—and at present he
sory group indicates much higher
owns at least a dozen sugar shares.
collect works of art.

lower priced

Francisco, Great tiles; Distillers Seagrams, Schenpreferred, Chesa¬ ley and National Distillers in the
Ohio, and New York, liquors and Paramount, Twentieth
and St. Louis indicate Century-Fox, Loews in the amuse¬
All

vestment

Some have had

corrections

such
as
Square D seems
relatively behind the others in the

RR.

Chicago
higher levels.

Conclusion
In

premium for valued desirable issues during in¬
long drawn termediate setbacks and selling
actually have issues which individually become
had bear markets of their own.
over-exploited.
Profits lost by
Other
stocks,
not
mentioned being out of the market for any
above, that are projecting favor¬ length of time can be substantial
able technical shadows for higher Stocks
will
return
to
previous
prices and should be carefully levels eventually, but eventually
them.

stock

'

two

still

are

there

Is

any

type

vestment for which I have

of
a

in¬

flair?

my
tax
status?
taxable, or non¬
taxable income? Am I fooling my¬

(9)

What

Should

I

self about
income

that

in

is

seek

high yields by seeking
the

form

of

dividends

fully taxable?
(10) Do I need advice, or
are

capable
own

am

I

of proceeding under my
Most
people need

that he always makes money
and
silver mines,
in
enterprises, in sugar

ness,

in

gold

amusement

shares

(providing the sweet things
life), in objects of art and in
stamp collections. Now, according
to a recent issue of "Life,"
all
of

are either charlatans
"fakes," and there is no scien¬
tific basis whatever for this type

astrologers
or

of
I

character-analysis.
concerned, I

am

be involved in

claims

of

astrologers.

in his

it works

lot

a

client

My

I know he

case.

of money,

over

and I

the years not

try to inflict my judgment

clients who
After

discussion of the

he has applied astrology and

has made

to
Individual Investment Personality

as

human nature and other scientific

have learned

professional advice.

a

far

So

don't wish to

possible effects of cosmic rays on

says

steam?

are

smarter than I

on
am.

have answered all
More seriously, without endors¬
these questions you will begin to
ing astrology as an aid to security
see that you have an investment
you

personality all your own, and that
this personality is far different
from
the
person
sitting beside
you.
As you get to know your¬
self better, you will be better able
to pick out the securities which
are
compatible with your needs.
Incompatability is just as bad a

,

;t

are

position,

their longer-

moderately from recent lows, but appraised at this point are as fol¬
lows: Columbia Broadcasting,
should carry still higher.
While
Container Corp., Fairbanks Morse,
new
highs are not technically in¬
dicated, elimination of E. P. T. Pepsi-Cola, Western Auto Supply,
International Tel. & Tel., Texas
would materially help this
group.
Favor du Pont, Monsanto, Ameri¬ Gulf Producers, Ex-Cell-O, Amer¬
ican Seating, Elliott, Worthington
can
Cyanamid and Davison.
Air
Reduction also appears rather at¬ Pump, E. W. Bliss, Colgate Palmolive Peet, Yale & Towne, Procter
tractively priced.
& Gamble, Revere Brass & Cop¬
Electrical Equipment
Strong per, General RR. Signal, Bridge¬
technical position stillindicates
port Brass, American Locomotive
higher levels for this group.
A and Homestake.

of the cement stocks such as Penn- levels'.
v'r V
1
cks and individual issues. We
Dixie and Lone Star.
Virilities — Technical studies
know that the market has not
Steels—After tax selling period show that companies in this in¬
m moving as a unit- during the
c

averages,

strong

a

potential

not

St. Louis San

Northern

of

arnings and dividends have been
ather

Dow

in

Foods and Food Products—Most
of the stocks in this
group indi¬

Bendix,

and New York Central. Also
many
of the medium priced issues such

appraisal of the
current

the

split.

ern RR.
should carry higher, be¬ While
there is no substantial base
of minor distributive top that lieve the best
percentage of appre¬ pattern indicating any upward
s formed; but right now I doubt
ciation lies in many of the eastern move of
any importance in these
hat we shall see a reaction below
roads such as Erie, Baltimore &
issues, believe there is very little
;he 255-260 D. J. level on the inOhio, Lehigh Valley, Pennsylvania risk in buying such stocks as Cel-

and

in

technically
not

a

;ype

lustrials

not

have

appear

the

as

Zenith should be

during
the
past
three Owens Ford.
months, and while some of the
Textiles, Liquors and Amuse¬
higher
priced
issues
such
as ment
Shares—All have had deep
Atchison, Illinois Central, South¬ declines
and

take the decep-

may

does Magnavox.

so

action

possible to project how far down
setback

project

strength into January.

.onditions. At this point it is im¬

any

Sylvania Electric looks

group
have
suffered
a
pretty extend its
recovery above 90 and
healthy decline from their 1952 General Motors close
to 70, but
highs last spring and many are should
temporarily top out early
now
selling close to a 6% yield next
year.
Particularly favored

level is reached,

appraise

from

Technically

Oils—Most of the stocks in this

this phase of the market.

carefully

40.

recovery move.

carrying into the spring
onths, and an intermediate top
If this 290-295

directly

sold and

take

lace

n

and

prob¬

—

E.P.T.

mild overall busi-

readjustment that will

less

Lead

Drugs—This group should bene¬

the look-

on

on

Joseph

and

ing.

two-million-share days,

Jut for some

Coppers

I

Cerro de Pasco also looks interest¬

January or early February
perhaps sooner — with quite a
more

the

held.

be

New Jersey Zinc at present levels.

and the

nd of

ew

certainly

as

should

like

now

is

There

yet that new
highs will be made in this group,

the

over

interesting and

some

should

but

seem

«

Stores.
recovered

not

Particularly favor A. T. &

.

levels,
especially
Brands, California Pack¬
ing, Corn Products, General Mills,
objective of
National
Biscuit
and
Safeway

technical indication from pres¬

no

especially

attained between

re-

slow

periods

on

decline

08-110 in the rails. I believe this

e

a

recom¬

are

term

Have

recent

carry

high

high

—

from

and

market

level

ndustrials and at least

and

,

Metals

273-

new

quietly

another

purchase

longer

35.

over

rails, I look

in

carry

the

industrials
the

on

in

correction

above

the

on

as

of minor weakness. Of this group
I favor United Airlines which in¬

Averages,

minor

a

for

move

for

mended

be

to

appear

airlines

able.

conclusion, since there is
T. and utilities in fast
growing, neither economic, statistical nor
sections of the country such as in
technical background existing, as
ing too long..
the Southwest.
near as I
can figure,
for an im¬
Radio & Television—This group
Natural Gas—This group indi¬
portant decline in the market at
has
had
a
substantial
upward cates higher prices and I believe the present
time, I believe there
move and is
currently enjoying a long-term purchases in Northern is room for a very worthwhile
booming fourth quarter. Techni¬ Natural
Gas, Chicago Corp. and advance in selective issues before
cal
position in this group has Panhandle
Eastern
Pipe
Linel they reach excessive or over-val¬
been slightly weakened
by this should be profitable.
•
<"• ued
levels.
As
investment an¬
recent
advance, but - long term
One
of
the
reasons
why
I alysts, we must try to make an
holdings should be maintained, haven't been able to get bearish
intensely practical appraisal of
especially in Radio which indi¬ on the market is because so
many each situation with all the mar¬
cates a long term price
objective lower and moderate priced stocks, ket tools at our command.
In¬
of

The

—

accumulating

year

Therefore

year.

of

level

hat

year

This

than

syst approach.
Airlines

dependable
occur.

of the Dow-Jones

erms

or

are

companies should be the

many

75

the

of

fourth-quarter earnings

est

hat

time

most

rallies

in
we

weeks:

the

the

easonal

selling

three

or

pproaching

higher levels do

37

word

in

financial

affairs

in domestic relations.

as

it is

analysis, I think this man's
cess

has

been

measure

to

the

tried

fit

his

to

personality.

due
fact

do the

withoub necessarily
star gazer.

no

that

securities

I wish

clients would

in

more
same

suc¬

small

he

has

to

his

of

my

thing,

employing

a

The Commercial and Financial Chronicle... Thursday, November 27,1952-

(2050)

38

tint

{mm

conunuea

Since the end. of World War II ^Unfortunately, our country has in the'productivity'of 4ts industry/
progress
in bringing^ about, gained
and with considerable enabling it to foster and to di-

r>nap

jrom jirbi puyc

our

convertibility, and particularly the justification —a bad
convertibility of such a key cur- abroad? for t a ri i f

■

Umii FnfAfKH
01 A 11UW lUIvAjlil

PAV
DaSIS

'

*

_

I

m

FflAMA Itllf1

•

world

been disappointing. In its recent; uously since World War I, we do not desire to be dependent lipannua1 report, the Interactional have pursued the completely ir-0n our bounty. European nations
Monetary Fund comments m the rational policy of lending without and other parts of the world al-

FAItrif

JUVViftwiftllV

instability.' labor.'*V
creditor "nation continThe deficit nations of the

the British pound, has Though a

as

rency
1'

wt

,

9m

reputation rect the international division ofj
Tv

;

WAAVjr

following terms on the slowness of

allowing

our

borrowers the chance

lied to ourselves wish to earh and,

With our aid they have weathered our progress:
'
1 to repay by selling us adequate-pay their own way This they will'
ized in large part by a series of the first chaotic aftermath of war
is a melancholy. fact that, supplies of their goods. .This situ-.be able to da if we are'willing to.
governmental efforts to support only to discover that their rebuilt seven years after the end of the ation must be changed if we a^e permit the importation of the'
the economy of the Free World. I industry and revived agriculture war the Fund has to report'.'that to succeed in restoring arid main'-*
J
- - - —
- will not take up your time to re- cannot now find markets for their international payments1 are still tainirig currency convertibility,
view the efforts which have been growing output.
A part of their far fr0m having attained a state
Despite the reductions that have
made since the war to assist our problem is of dourse still in the of balance and that exchange retaken place in American tariff 4;;
• -••••a
•friends and allies among the free field of domestic economic policy, strictions
are
again, over v large'rates since the inauguration of
nations to recover from the cata- but the key to the solution of most parts 0f the trading world, the the Reciprocal Trade Agreements ■
American Private-Capital,

United States has been character-

*

of the difficulties lies in an ex- order 0f the day."

Program, many rates are still re- • Immediately, after the war 'it;
panding world market.
In contrast with the present strictively high—so high as to exassumed that private risk,
You are all familiar with the
The United Stat.es is the only melancholy situation, the world in ciude goods from the American5a?ital
fW from the IJni-;
Bretton Woods Agreements, with "free
country with enough eco- the seven years following the first: market.. in Various ways the re- ted' States to develop-the worlds
the Monetary Fund and the World nomic strength to meet this situ- World War had made consider- strfctive- effects of our'high' tariff - resource* mucfr; as private-British;
Bank, the first British loan, the ation. Canada can help us and we able progress in stabilizing cx- rates are further aggravated
*went abroad in the nrneSror-chcii plan with ft A and know that it will help, but the change rates and in making, the through i m n o r t classification■. tcenth- century.Howler, investwith th?' iCL ^ance key responsibility is ours. It has leading currencies of the world Ses in appraiser
ment opportunities at hOme 'haye
Procram and the
olex (jrgan- been ours for the last seven years, convertible in terms of gbld
mSfreS5; b<*rr*o great arid^ the return so"

strophic economic effects of the
and to increase world trade,

war

-

rzSmwamcdhthfSnXoSe1„0rpgaaris
the

under

bassador

ot

direction of Am-

able

It is sufficient

Draper.

t0f«al\^^S^ture
effort, while it has met the

and

a^w

what

need

we

now

is

lone-ranee foreign policy—

>

i

As the President-elect,

program.

himself

Eisenhower

General
clared

in

month

ago:

If

New

less

for

need

than

a

nomjc

military

ampje

seven

years

vjg0rous

$33 bilforeign sid, the central
problem is as far from solution
as it is today, I think something

Certainly

we

for

tute

in our thinking.
must find a substi-

the

purely

temporary

business of bolstering the free nations

annual

through

This

gets neither

sults

no

faced

re-

real friends."

nor

In

World

handouts,

permanent

a

the

since

year

War

has

II

the

serious

more

of

end

of

the

of

forces

Com-

been

and for the persis-

and foreign exporter are subjected
to the handicap of complex con-

controls has

nf^ati^reeufations amToutworn

exchange
The

inflation.

has not

presence

basic attitudes

on

the part of gov-

quite different from
those prevailing after World War
ernments

I.

These

nations

attitudes

have

live

to adhere

their

to easy money

it

does

There

now.

is

no

longer any doubt in anyone's mind
that the goal of the Kremlin is

tive

machine

and

the

greatest

to "peril point"
clause' procedures

recourse

our
War
Korea,
Indo_china, the political crisis
South Africa, the problems of
East-West
trade
in
Europe,
of

that a little inflation is always a
good thing.
D e s p i t e the disappointments
that have plagued our efforts

foreign producers from ment on private righ^nd the inentering the American market, tegrity of contracts if private capRecently there has been a sharp jtai is to be tempted into inter-!
increase in applications for relief national investments.

China

in

since World War II, I believe that

under the

nationalization

of

rapidly approaching is a very disquieting development!
the time when, if nations have the to our friends abroad, evidencing
will, we can establish an appro- as it does a revival of protectionPriate environment for convert- ist sentiment within the United

overwhelmed bv the masnitude

?n

probTem

of
in

in

with

trade
the

Far

Communist

East,

the tin mines in

Bolivia, the presshortage of dollars in Brazil—
all of these of course require and
ent

must receive individual attention,

But I believe that there

are

four

* escape

and

the full

dis-

tries

larJrt

"escape

This

clause."

of

new

weanons

and

in

factories

which

from

chinery for

mass

Morewer° werin

com a

thA

new

states.

Recourse

clause"

the

to

introduces

"escape

great

uncer-

.

2.

The

(4)

TheTecessity

All

of

for

encour-

a,

0

problems

vi-

are

1. The Existing Inconvertibility of

bulk;

of

the

or-

raw

tallv

^

Our government has quite
up to now depended upon
fact that the mobilization of

these great forces in the sight of
the world was sufficient to in-

timidate

even

members

of

the

the

redoubtable

Politburo.

It

is

rapidly becoming clear, however,
that we
cannot
decisively win
even

the cold

war on

the basis of

superiority in productive capacity
and military power alone; nor can
our
economic system,
large and
powerful as it is, indefinitely sustain the drain of
race and

endless

an

arms

continuing grants-in-aid
ies*
i.

.

u omwauwu.

Foreign Currencies.

clearly
the

A

maior

World
tion
the

of

in
its

facine

economic
of

mimists in many parts
of the
world—for example, in Iran and
in the strategically rich areas of
Asia.

One

mistake

on

our part or on that of our allies
in these delicately-baianced areas




Free

mobiliza-

strength

currency

is

con-

The free convertibility

currencies

played

a

decisive

role in the economic development
of the Western World. It underlay
the great trade expansion of the

Victorian period.

growth

of

It fostered the

multilateral

trading,

stimulated private foreign invest-

ment, facilitated the development
of tourist travel and spurred the
flow
of
immigrant remittances,

The visible and invisible items in

j.

of raw materials is today being
seriously threatened by the Com-

Southeast

the

effective

restoration

vertibility
of

task
an

„,Aad ^e.m.uvf existing supplies the soared to
world's balance
to the not forget that all
our access

Ci uJid
qniutione

in

.

of payments

high levels of expansion within the benign framework of convertibility.
We in this country must help

Restrictions

they could

and

,

Todav

t

established.

become
of

many

our

"infant in-

currency

a^lfr^

tha
eco-

country must

our

the

have

foreign

realistic

nractical

on

0f

that

me

four

brieflv

'

nroblems

outlined

to!

i
i
; The convertibility ot major cur-^
ren5.ie,s -?n curr®n!;
'

.

V

'

■

-r

^

'? w?
T
^
<4'
l°°iS m
^
f pohcies. The. nations of
Western Europe and the-United

w

+

w

syass»s:
stimulated

and

savings -expand.

Price controls and subsidies can

have reached maturity, be eliminated or reduced, and free
At the same time they are out- markets established.
stockpiling program, this growing domestic sources of supSeldom has history presented a

jn

cour!trypolicies, with resulting dis- ply of depend. materialsof having and a greater aopportunity than it
has - followed somewhat they the raw Instead on which nation with
greater ..challenge
erratic
locations in the prices of the key an exportable surplus of

raw materiaIs. of tha rrld; -uWe
can make an important contribution to economic stability if, in
^.he future> our government acts
with prudence and consistency in
its stockpiling programs.
Prices of raw materials react
sharply to small shifts in demand,
The economies of countries specializinS in the production of basic raw materials are particularly
sub-iect to violent fluctuations,
with disastrous economic and po-

raw ma-

now

presents to the United States,

tfri?ls' the .United States is sud" ?f Ameriea. T.he ihall?ftge c0?*

denly running low m many of from the Soviet Empire, resting
them. We are now a net importer upon a directed and integrated
of petroleum products. By 1955 economy stretching from the Elbe
we shall have an important flow River to the Pacific Ocean, and
of iron ore from Canada and Ven- from the Arctic to the borders of
ezuela to supplement the trickle India. It encompasses 35% of the;
that has long come from Chile, earth's surface and is the homej
The Caribbean is pouring bauxite of nearly one half of the world s;
into our gigantic new^ aluminum peoples, living in an. area withm;
mills; uranium is arriving from which are no contro
the Belgian. Congo; manganese barriers to cireumvenl
from India and Brazil, and a large
Kremlin dictators,

b^ca! consequences. We are all part of our copper from Chile.
•• The economic and military^
cognizant of this problem and:
As the Paley Commission Re- strength of this slave world beshould devote our best efforts to port points out in detail, United hmd the Iron Curtain is formi-|
Protect the economies of .these states demand for minerals alone dable- But I believe that every
countries from such fluctuations,
because their economic welfare is
vital to the continuance of our.
own security..
^
.

*

3'

^

Fvicfimr

imports

a

come

ports

$2

g^ptMiAnc

1975 will have increased 90%
iarge portion of which must
from abroad

which

billion

,gth?'have now
in the United States

Arising^ FromOur Tariff and
°ther ReffuIatory Policies*
Almost

by

every

country in

the

tQtal

a

year

less

than

before the

war

passed $10 billion a year

*

^ext

population and

£ ^d

Our total im-

averaged

double
2o

our

years

this

as

our

industries

ex-

.

world lacks dollars. Some coun- p
the economic systems of free na- tries need them in order to buy
+9 ^ant foreign nations freer
tions are to be integrated if their agricultural products and modern access to tne American market we
productive power is to be con- machinery available only in the snoula therefore not only enact a
solidated, and if we are to present United States. Others need dol^ c"atp^n ^pI™a"
restore

t

to
new

World Markets in'Key Com- dustries"

on
ln 0 $2* C5UntIy anSlng
ir?m 0Ur1.t®rlfI and other regu-

S

Existing

Resulting Dislocations of Uie

ma

in the Free World

the

n0mic Dolicv

a

•-■■^crieBarafe^&at'Ss asagasgseas t

«. markets

known supplies of every strategic
material.

access

to

elear

foundation for

ttat t tsss&wssxsf swwrrai

important and should receive
nroLt conrideratfon
receive

bit

_PPTY1S

vou

world's

have

Conclusion
Tt

wv,ich

through the prompt
initiative of this country, would
eliminate many of the difficulties
which we and our allies in the

dislocation of the world

coun-

aeree-1

common

>

basic problems, the ultimate solu-

production

the Uidted States

-

tion of which

ZYfrJ• (3) The existing restrictions

capacity to build the huge

creatine

courage

ibility. My optimism is based on
changes occurring in popular, at-

iftheleadSThMhhflmP0rtS

tion

cooperation of other

in

we are now

5?" in key commodities.

•

States alone cannot

policies, to embark on uneconomic
ventures and to endorse the idoa

S",« jRwress«-—sttr^aiasaras.'

rp^e united

iff rates but the possibility of in- correct this situation. More than
creases in existing rates through
any other field we must have!

titudes toward inflation and in tainty in our tariff policy and
growing appreciation of the.yite}.. impairs confidence in our willneed for convertibility as the basis ingness to engage in reciprocal
°f a strong and prosperous world, economic cooperation.
a
world controlled by Moscow,
The way back will not be easy.
j
..
.
j. •
..
admit that
The goal of the United States and Free World now face. A vigorous Success will call for understandwhole
foreign
trade
backour allies is a Free World in which
affort to solve these problems is ing and courage on the part of our 1 ®
™ J
United Stetes^hac.'
all people can live and work to- the only sound approach to the friends abroad and ourselves.
altered so much that hot even thegether in peace.
economic situation in which we
To undertake overnight.on. a i;uerai;z;ne Gffect 0f the RecioroIn the vast contest which has find ourselves in this second half worldwide basis the convertibilityTrade^^ Agreements has been
resulted
from
thS mnflww of the twentieth century These of all currencies is clearly impds-"-'caV;Trade Agreements has been
than

pling exchange controls, tax reg-

Not alone the current high tar-1

caused

beyond

to

tempttn^thatprlvate capital,with

ra*es» regulations.and outworn potions, and—above all—growing:
Practices all conspire to discour- nationalism, with its tendency to
age foreign ^producers fiom try- confiscate private property/have
ln£
enter the American market djSCOuraged private United States
an(* have the effect of reducing capital from moving outside our!
imPorts into this country.
borders.
\j

of

inflation in the postwar period inself reflects a chang# in certain

means,

must not allow ourselves to

country

challenge

it

that

munism.

of

has been wrong

so

match the ruthless totalitarian ex-

after World War II> and

lion

bold and so
will more than

strategy

pansion
of

end

the

at

York

de-

been achieved

which never underestimates tence of

Qne

immediate
strength on the part of ourselves
postwar period, must now be sup- and Qur ajhes but which
suppleplanted by a sound, long-range ments this with a dynamic ecothe

of

emergencies

the principal

judgment

reasoiTwhv c^nvertibilitv

convertibility if

.

,

^

person in this room tonight knows;
that the nations of the Free World;

have the courage, the tenacity, the,
productive capacity and the man-;

a&erial genius to. win the long
range economic conflict with the:
The realization of that

ob3ective is the keystone in the!
reconstruction of a peaceful world
—a cause to which the people of
our country

and the rest of the!

Free World give their ardent and;
undivided support. This , is our;
opportunity. The realization of.
the vision of a free world, eco-4

nomicaiy strong enough to insure
the principal oW

ion's

_____

States market-

°

.

tury ago.

It possesses

a

long lead

economic policy.

new

foreig

Volume 176

Number 5172

The Commercial and Financial Chronicle

..

.

(2051)

The

Indications of Current

following statistical tabulations

latest week

Business Activity

week

or

or

month available.

month ended

Latest

AMERICAN

IRON

Indicated

steel

AND

STEEL

operations

(percent of capacity)

Nov. 30

Previous

Month

Week

Ago

ingots and castings

(net

tons)

Nov. 30

AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output—daily
42

gallons

"lOS.S

107.3

Kerosene

Distillate

fuel

oil

output

oil

,

Revenue freight loaded

CIVIL

117,036,000
23,973,000
2,472,000

2,713,000

2,597,000

10,898,000

10,376,000

10,183,000

8,478,000

8,417,000

123,313,000

121,374,000

6,616,000

22,114,000

Based

2,802,000

U.

S.

Private

122,002,000

33,383,000

34,568,000

35,097,000

119,148,000

120,146,000

120,937.000

107,052,000

51,942,000

53,602,000

54,450,000

49,539,000

828,723

829,198

838,377

814,258

703,590

687,482

cars)—Nov. 15

699,721

717,168

i..

Nov. 20

•Nov. 20
Nov. 20

$269,883,000

164,746,000

$411,529,000

$260,335,000

coke

DEPARTMENT

BUREAU

249,420.000

104,187,000

105,132,000

162,109,000

156,148,000

90,479,000

123,313,000

STORE

SALES

32,835,000

10,560,000

9,900,000

8,320,000

917,000

11,634,000

929,000

960,000

1,021,00,.

81,200

*84,500

96,800

140,700

*118

124

130

MINES):

100

ELECTRIC

FAILURES

..

AGE

COMPOSITE

Social

Electrolytic

7,883,878

7,696,243

7,157,038

167

148

154

149

4.376c

4.376c

4.131c

Residential

Farm

Export

refinery

refinery

tin

(New

INDUSTRIAL)

DUN

—

Other

$55.26

$55.26

$52.72

Nonresidential

$42.00

$42.00

$42.00

$42.00

at

Lead

(New York)

Lead

(St. Louis)

Zinc

(East St.

MOODY'S

U.

Louis)

at

34.625c

34.700c

121.250c

121.250c

121.500c

14.500c

14.000c

13.800c

18.800c

12.500c

13.500c

19.500c

96.80

96.91

Nov. 19

PRICES

DAILY

12.500c

Public

Utilities

Industrials
MOODY'S
S.

U.

YIELD

BOND

37

320

350

Sewer

and

108.88

109.03

112.93

113.70

111.81

111.44

112.56

New

108.88

108.34

107.98

Middle

103.64

103.30

102.80

Public

105.00

East

112.19

109.06

South

112.19

111.81

113.50

2.71

2.71

2.73

2.71

3.21

3.23

3.19

——2-Nov. 25

,

2.97

2.99
•

3.23

3.23

Orders

received

Production

PAINT

=

3.37

3.40

3.18

3.19

3.22

3.05

3.07

406.8

407.4

411.0

DEALERS

215,183

372,747

226,513

243,255

SPECIALISTS

Odd-lot sales

ON

of

248,541

208,429

97

97

Number

86

548,900

581,03.9

519,768

426,284

109.44

109.50

109.47

116.45

of

shares

Odd-lot

purchases

Number

of

short

Customers'
Number

short

Customers'

Round-lot

21,027

89

117

267

303

20,346

Nov.
Nov.

—

sales

20,910

1

592,967

3,370

4,457

568,209

581,543

588,510

ACCOUNT

SALES

ROUND-LOT

OF

ON

NEW

$23,768,696

154,030

164,790

170,510

Other

Nov.

164~790

154,030

ROUND-LOT

8

348, G50

Short

FOR

ACCOUNT

OF

Other

.

170,510

148,840

329,920

270,980

sales

1

187,370

Nov.

1

199,170

6,243,370

169,660

5,572,710

6,056,000

1

Total

the

5,964,260

"

sales

5,771,880

«

6,133,920

Total

sales

,439,850

Short

Other
Total
Total

Total

Short

Other
Total

433,220

871,950

Cranberries

555,140

558,620

527,350

1,091,110

116,350

102,820

91,000

238,700

8,300 '

8,100

4,800

98,500

110,490

WHOLESALE

172,590

1

370,333

28,250

19,780

1

60,210

242.101

197,001

251,825

1

359,379

270,351

226,541

271,605

419,589

Nov.
Nov.

PRICES,

NEW
=

SERIES

—

U.

S.

DEPT.

940,935

817,350

760,360

1,649,813

134,430

147,220

118,710

1

309,870

792,861

744,541

795,535

1

1,447,089

927,291

891,761

914,245

OF
.

——

—

products

Processed

"Revised

——

:

All commodities

figure.

110.4

other than farm and foods




S.

As

Total
at

28.273

2,32J,22ti

7,424

6,120

10,392

(bushels)

10,334

10,485

61,330

„

__

61,330

63,239

95,975

110,660

92,696

62,622
30,879

3,140

3,092

202

202

174

174

183

786

812

910

127,256

154,895

$1,070,000

$1,232,000

817,000

721,260

$275,000,000

$275,000,000

264,919,493

262,681,570

258,298,191

44,803

40,061

$262,721,632

628,001

630,223

$264,336,294

_

(barrels)

EXPORTS

AND

$262,091,408

$257,665,262

10,663,705

12,908,591

17,334.737

63,627

30,028
3,386

*

.

230

IMPORTS

—

STATUTORY DEBT

of Oct.
face

31

LIMITATION

(000's omitted):

amount

that

time
Outstanding—

be

may

outstanding

any

Total

•

public debt
obligations not
~

gross

Guaranteed

Treasury

owned

by

the
-

37,483

debt and guaranteed

obligations

$258,335,674

Deduct—other

outstanding public debt obli¬
gations not subject to debt limitation

104.3

105.1

105.6

*106.3

107.4

*101.3

105.2

Balance

112.5

under

99.4

runs.

Z;, i' f'

325,708

30,814

2,234,535

7,277

(pounds)

GOVT.

102.6

Nov. 18

^Includes 612,000 barrels of foreign crude

•

_

345,561

29,362

2,231,188

_

$264,964,296

States)

STATES

110.6

-Nov. 18

_—Nov. la

'

280,512
1,676,125

BUREAU OF CENSUS—Month of September
(000's omitted):

mo:7

Nov. 18

foods

Meats

Nov. 18

286,209

1,225,145

349,257

__

_

Exports

U.

3,763

289,268

(tons)--

Total gross public

100):

commodities-.

Farm

(5

1,756,959

-

Commodity Group—
All

2,697

1,262,820

(tons)

States)

Imports

—;

LABOR—(1347-49

>

246,260

170,680
29,540

—Nov.

sales

UNITED

215,760

115,290

Pecans

30,500

.93,500

106,600

sales

17,446

2,697

...

$275,000,000

449,040

1

7.479

16,291

877,400

_

457,260

——Nov.

32,035

5,895

_

126,482

_

(3

101,800

.—

42,9-37

31,043

5,895

16,655

__

$1,217,300

(tons)

(12 States)

transactions for account of members—

sales———

42,040

31,043
_

*

Apricots

1

12,563

43,805

62,622

Cherries

--Nov.

108,461

11,083

33,802
159,265

-

30,494

219,160

239,495

purchases

15,144

103,858

(bushels)

1,040,780

—.—~———Nov.

_

14,413

(bushels)

94,130

..Nov.

sales..

70,996

11,083

_

496,770

1

sales

21,410

47,730

-

_

543,850

1

sales

round-lot

„

_

Hops (pounds)
Apples, commercial crop

8,994,590

Nov.

—....—

254,668

15,759

31,033

70,674

Sugarcane for sugar and seed (tons)
Sugar beets (tons)

8,554.740

—Nov.

;

purchases—

222,476

48,392

(bushels)

(bushels)

109,580

1

306,185
1,316,396

-

(bushels)

97,880

1

214,907
1,265,660

222,476

(pounds)

585,090

l

35,820

214,907

42,040

__

J

Nov.

987,474

1,265,660

__

(tons)

1

-Nov.

—

21,424

_

—

Peanuts (pounds)

Grapes

Other transactions initiated off the floor—
Total

alfalfa

(tons)

1

Nov.

sales

21,424

_

(tons)

Peaches

1

__

_

_

floor—

purchases

Short
Other

wild

Pears

Nov.
on

342,005

103,858

_

(bushels)

Nov.

.

transactions initiated

___

bags)-

Soybeans for beans

300,600

MEM¬

—

645,469

236,331

15,759

Nov.

sales

1,062,590

31,033

—

Nov.

sales

Total

all

Potatoes

Nov.

purchases

Other

*

_

clover and timothy (tons)
lespedeza (tons)
Beans, dry edible (100-lb. bags)
Peas, dry field (bags)

BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS
Transactions of specialists in stocks in which registered—
Total

(100-lb.

Tobacco

—

TRANSACTIONS

_

_

_

(bushels)

Sweetpotatoes

Nov.

_

______

_

ibushels)

Hay,

(SHARES):

~

2,941,423

1,298,921

AGRI¬

thousands):

Hay,

YORK

sales

3,256,550

1,062,590

OF

(in

Hay,

sales—

sales

1

——

spring (bushels),

Hay,

148,840

8

sales

3,302,875

236,331

Nov.

(bushelsi

Hay,

$24,174,760

STOCK TRANSACTIONS

MEMBERS

329.5

14,905

8

.

THE

331.6

REPORTING

DEPARTMENT
of

(bushels)

Sorghum grain

560,642

$23,670,713

8

S.

CROP

—

<1935-

(bushels)

Rice

9,255

$2,215,493

—Nov.

;

STOCK

338.7

INC.

_

shares

$409,000

COMMODITIES

569,897

10,472

Nov.

—

$565,000

YORK—

October

(bushels)

Barley

•
—

all

OF

of

(bushels i_

Flaxseed

19,82':

578,681

20,172
584,913

purchases by dealers—
of

Oats

Rye

Nov.

—

U.

ail

Other

•

20,094

.—

—

sales

Short

BOARD

$31,940,676

20,261

Nov.

Round-lot

Total

$30,517,997

20,649

Nov.

ROUND-LOT

fOR

$32,901,935

8

sales_

53,886,760

313,559,061

$591,000

NEW

BRA.DSTREET,

PRODUCTION

Corn,

715,703

—Nov.

sales

other

EXCHANGE AND
Total

CROP

25,435

674,366

."—Nov.
——-—Nov.

sales

Number

TOTAL

24,144

746,001

779,475

$34,676,021

sales)—

Round-lot sales by dealers—
"
.
Number of shares—Total sales—

Other

26.528

8

value

Short

27,676

8

sales

&

OF

omitted)

PURCHASES

All spring (bushels)
Durum
(bushels)

Nov.

sales^

shares—Total

of

total

sales

other

Customers'

Dollar

dealers (customers'

by

orders—Customers'

Customers'

$367,445,821

34,304,009
354,582,576

OUTSTANDING—FED¬

BANK

(000's

1939=100)—Month

Winter

8

31

CULTURE—As

——Nov.
—

$388,886,585

376,358,640

1,298,921

PAPER

RESERVE

Wheat,

Nov.

value

16,458,180

49,946,823

38,559,731

Oct.

of

—DUN

COMMISSION:

orders

Dollar

29,288,609

11,657,832

72,057,462

$414,918,371

States.

City__

ERAL

by dealers (customers' purchases)—

Number

United

York

As

STOCK

Y.

31,024,905

82,299,475.

15,836,649

COMMERCIAL

INDEX—

N.

EXCHANGE

58,270,660

80,647,840
58,225,322

89,868,568

:

Total

186,612

243,283

96

Nov. 21

AND

91,666,219'

$20,911,700

456.1

3.45

Nov. 15

period

100

EXCHANGE—SECURITIES

29,667,872

80,733,337

„

Central

CONSUMER

PRICE

35,742,737

62,736,028
31,029,797

—

Central

New

2.96

Nov. 15

REPORTER

72,483,788

33,814,921-

1

Outside New York City.

3.22

3.05

Nov. 15

of

$15,982,982

72,626,574

;

3.58

'

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDLOT

3.55

,

Nov. 15

DRUG

AND

AVERAGE

1949

3.53

3.25

Nov. 25

—

end

CITIES—Month

Mountain.

3.28

ASSOCIATION:

activity
(tons) at

5

&

__—

Central "!'

West

3.03

Nov. 25

—

INDEX

(tons)

(tons)

Percentage
of
Unfilled orders

OIL,

—:—

5

58

20

$28,272,491

Atlantic

Pacific

2.97

3.26

'

Nov. 25

Group

Group

PAPERBOARD

NATIONAL

3.01

3.09

3.07

Nov. 25

COMMODITY

78

5

DUN

—

79

.

3.22

—Nov. 25

Group

Utilities

VALUATION

63
22

77

England

105.86.

3.52

Industrials

293

62
20

service

INC.—215

40

of October:

'109.06'

3.05

MOODY'S

PERMIT

BRADSTREET,

109.60

—^—Nov. 25

Railroad

building

;

public

South Atlantic

BUILDING

109.79

—

Aa

.

enterprises
Conservation and development—,
All other public-.

1

;-r

institutional

water-

113.31

AVERAGES:

——,

"

^

r

—Nov. 25

Aaa

318

152

103

—Nov. 25

—

369

363

127

106.39

Bonds

corporate

Average

66

128

106.74

—

DAILY

6

941

53

136

—Nov. 25

Group

Government

building

7

1,068

35

—Nov. 25

Group—-2—

7

50

34

113.70

4

44

267

1,025
_

nonresidential

96.96

103.80

48
291

105

112.19

Group

40

49

274

I

41

109.24

108.88

148
351

37

40

96.94

.

168
376

36

156

109.60

-Nov. 25

Railroad

telegraph
utilities—

and

Nov. 25

Aaa

10

139

-

Nov. 25

—

corporate

25

359

_

building

Miscellaneous

AVERAGES:

S. Government Bonds

Average

36

27

Highways

19.000c

14.300c

33

26

Military and naval facilities

103.000c

14.500c

14.300c

38
31

12

137

Other

27.425c

Nov. 19

:

34.575c

140

38
32

137

24.200c

Nov. lg
Nov. 19

at
at

BOND

Nov. 19

<

at

142
'

31
■,

Educational

24.200c

54

12

-

Industrial

QUOTATIONS):

24.200c

41

57

91

33

construction

4.376c
$55.26

24.200c

95

44

39

and

18

———Nov. 19

101

All other private—-

Public

at—

205

141

institutional

,

public

187

60

I—Z_Z_

Telephone

440

46

I_

Railroad

&

14

430

106

recreational

and

858

18

437

;_IZL'I_IIIIII~

963

96

18

(nonfarm)

1,908

935

92

-

$2,849

2,030

1,049

930

I_

$3,098

1,982

1,040

II

construction

Hospital

York)

$3,007

OF

millions):

.

Public utilities

copper—

Domestic

Straits

J.

34,831,000

$398,114,000

alterations.

and

Hospital

PRICES:

M.

&

DEPT.

(in

-

.Nov. 18

(E.

S.

October

Educational

7,971,149

Nov.

PRICES

30,583,000

$454,199,000

190

and

.Nov. 18

METAL

of

Miscellaneous

.Nov. 20
IRON

27,858,000

Warehouses, office and loft buiidings
Stores, restaurants, and garages
Other nonresidential
building
Religious

131
/

AND

3,593,000

$449,429,000

building (nonfarm)
dwelling units

.Nov. 15

INSTITUTE:

(COMMERCIAL

17,920,000

between

construction

•Nov. 22

EDISON

==

shipped

16,476,000
59,646,000

construction

Commercial

12,985,000

INDEX—FEDERAL RESERVE

AVERAGE

9,267,000

32,348,000

Industrial

56.201,000

71,630,000

(tons)

108,487,000
7,439,000

30,393,000

;

-

Nonresidential building

69,136.000

76,422,000
28,715,000

(tons)

SYSTEM—1947-49

and

—ZJZ-Z.Z.

CONSTRUCTION—U.

new

New

93,962.000

.

Nov. 15

OF

$226,405,000
106,098,000

Residential

$163,148,000

Nov. 15

S.

$231,568,000

7,869,000

t

Additions

.Nov. 15

Beehive

stored

LABOR—Month
Total

ENGINEERING

—

Nov. 20

(U.

goods

Nonhousekeeping

anthracite

$237,106,000
113,855,000

,

of

.

OUTPUT

on

Private
-Nov. 15

(no.

construction

Pennsylvania

Ago

BANK

31:

ZZZZZZZZZZZZZZZZZZZZZZZ

-

BUILDING

RAILROADS:

,

Oct.

Year

Month

120,644,000

32,247,000

Nov. 15

(number of cars)

construction

RESERVE

of

Total

.Nov. 20
COAL

YORK—As

foreign countries

NEWS-RECORD:
Total

NEW

Previous

OUT¬

9,403,000

6.898,000

23,152,000

Nov. 15

CONSTRUCTION

ACCEPTANCES

Domestic shipments
1
Domestic warehouse credits
Dollar exchange

9,688,000

8,651,000

6,860,000

23,465,000

..

Nov. 15

at

received from connections

ENGINEERING

OF

6,237,150

Nov. 15

.

(bbls.) at

ASSOCIATION OF AMERICAN
Revenue freight

6,527,500

Nov. 15

Kerosene

fuel

6,612,300

2,079,000

Exports

output (bbls.)
Nov. 15
Stocks at refineries, bulk terminals, in transit, in
pipe lines—
Finished and unfinished gasoline (bbls.) at
Nov. 15

Residual

2,229,000

6,621,800

Residual fuel oil

(bbls.) at
Distillate fuel oil (bbls.)

*2,212,000

Nov. 15

:

(bbls.)

DOLLAR

STANDING—FEDERAL

Nov. 15

—

of that date:

Month

BANKERS'

of

(bbls.)

(bbls.)

output

2,191,000

Nov. 15

are as

Latest

104.0

Imports
(bbls.

average

each)

Crude runs to stills—daily average
Gasoline output (bbls.)

of quotations,

cases

Ago

105.5

Equivalent to—
Steel

in

or,

either for the

are

Year

Week

INSTITUTE:

production and other figures for the

cover

Dates shown in first column

that date,

on

39

113.0

v

*113.0

Grand

total

face

amount

above

"Estimated.

outstanding
of

obligations,

authority-—

,

'

670,412

issuable

49

The Commercial and Financial Chronicle

(2052)

barriers

Tomorrow's

looking

believe

don't

technical anticipation of a setback. How Whether it has, in fact, done so

see

that

up

is pends

market

the

I far such

Whyle

Too

shakeout.

severe

.?

^
ready been reached.
,

Says—
I
1

So
bo

di

t
,

[The

the

that

SUgg

By WALTER WHYTE

would

I

275 is to be

surest

now
now

th

8

*

*

*

al-

rest of your long holdings be
nothing as stimulat¬ sold on the rising market in
ing as a rising market.
It is
even stimulating to a sold out
Continued from page 23
bull like myself. But under¬

There's

de-

can go

hazard

about 270-

t

P

the current U. S.

expressed

neath all this stimulation I

signs of

this

in

*

*

time

coincide

On

chronicle.

They are

firms

were

Administration

Eisenhower
arid

its

cabinet

new

will

do

plenty to restore confidence.
We've
already heard
that
many of the controls will be
We've also heard

eliminated.

Truman

that

eliminate

may

them himself before he exits

from the White House.
of

have

us

least

we

all know it, or at

the chances
signif¬
being
dis¬

it,

expect
that

are

from

the

market

its

States

United

the

to

eign countries, and that $22 V2 bil¬

in placing

Payments
orders

inability

or

U. S.

in

stepped

look, therefore, to the

demand and utilization side of the
balance of payments. Since there
is no way of realistically apprais-

ing

latent

true

utilizations

actual

guide.

a

demand

The

must

total

abroad,
serve

amounts

as

ex-

pended here by foreign countries
have varied far more than has the
commercial

of

quarter

foreign
Foreign Purchases
We must

to

1950,

however,

countries once more
up their buying, with a

which, except for

~

For the past

most.

you've

seen

You've

a

seen

difference going

toward

one

,

against events during the first part
of the year and made the indicated adjustments. Although for
the most part the trends conformed to the expectations previously expressed by the Group,
the total anticipated dollar outlay
during the year was reduced from
$23V\ billion to $22.3 billion. The
decrease came entirely from a
scaling-down of the amount of
government military and economic
aid, in view of the lower than

Jwji

few days and dividends payments have
/t?' S?
rising market. risen, however, from approximately $80 million to $2 billion
new
highs. in 1951. Purchases of merchandise 0UlDyrst

™

hto

a

utilization side, the Group agreed

that there would be

some decline
of commercial exports during the

You've

seen

the Dow averages

through

previous resis¬
tance levels. It is amusing to
read the encouraging analyses
of those who

said

the

few weeks ago

a

Dow

Theory was
dead, and now point to it as
having "proved" a continua¬

have accounted for 75% to 80% of

the

total

$500 million without

any

appre-

ciable change in the estimate for
the year as a whole- In view of
the lag in shipments of militarycimfinr end hems during the first part

.
? keen a
A
of the year, the estimate for
0;t demand, directed these exports was cut back so that
V; n(h r?0waJ0s T
the combined exports of commerrn*lea states ana uanaaa. in some ciaj merchandise and military-end

The

maintenance
maintenance

normally
been
Deen

heavy

extension

of
or

,

onlv

dollar

grants

*

*

Frankly I don't care if the
Theory, or any other
theory, is dead or alive. At
best they're what their names
imply, "theories" and any¬
body who relies on them com¬
pletely without regard to
other factors isn't going to be
around very long anyway.
Dow

*

*

Right now you have
strength; good strength. That
means
that most people are
bullish.
Yet every bull is a
.bear because he's looking for
a spot to sell.
We also hear
that

"

That's

sentiment

is

bullish.

But senti¬
ment does not make prices go
op or down. It is money that
very

nice.

"

does that.
*

*

%

*

or so ago I sug¬
right after the
elections half holdings should
be disposed of.
Since then

stocks

that

have

through 1951

gone




$34

vided,

billion

nearly

thus

were

two-thirds

pro—

in

the

first three years. There is no need

up

much

of

it

undoubtedlv

ren-

mucn 01 it unaouoteaiy rep

power.

excess internal purchasing
Some of it mav also reflect

the fact that for certain items

products the dollar
oniy

satisfactory

convinced

area

is still the

source.

of the need

or

to

Finally
expand

the industrial base without delay
many

countries and governments

have embarked

vast programs

on

0f

business

activity while

in others there has been

liquidation,
slow

down

orders
ucts.

certain

for

inventory

both combining to
the placement of new
types

of prod¬

Thus,

again, the demand
supply side has
the determining factor.

rather
been

the

than

Future Prospects
What lies ahead? I

am reluctant
anything in the way of
a definite
forecast, since the NFTC
Balance of Payments Group pre¬

to attempt

will

sumably
a

be

preparing such
1953, on the basis
review and discussion,

statement for

of

joint

and I would not wish to
their

conclusions.

realize that this is

anticipate

Nevertheless, I
matter of

a

con¬

stant definite interest to all of you
and particularly so at this time.

to

guess

to

venture

that the first Phoenician,
the

to

far

the Mediterranean

reaches

was

of

invited

on

his return to

Tyre to address the
equivalent of the Export
Managers Club on the subject of
local

"The

Outlook for Trade

Iberian

Penninsula."

certain

that locked

with the

I

also

am

in for¬

away

gotten archives of the Florentine
banks there must be

by

pared

bearing

one

a report pre¬
their members

of

such

some

title

"The

as

Prospects for Sterling." But
rather than attempt a clear-cut

will be affected not only next year
but in subsequent years by two.

factors

which

in

themselves

are

items

were

set at about $1.3 bil-

economic

and

activity in the U. S. will

in

decline

the latter

will

not

in

1954.

time

part of 1953

revive
this

If

until

some

is

sag

no

greater than that of 1949, its effect,
on

the dollar

to

be

the

supply is not likely
overly heavy. Moreover, to
that the down-turn is.

extent

accompanied

by

a

price

decline

which thereby increases the pur¬

lion legg than had been estimated chasing power of the dollar, the
?
janUarv
The total
nevertheJ
January, ine total, nevertne- two trends may cancel each other
legg

remained about $800 million

'

+h„

iqci

f:anro

insofar

as

tion

„h

concerned.

is

foreign dollar utiliza¬
While

no

one

first time in several can now foretell how far the new
months foreign countries on bal- Administration might cut back on.
ance were able to add to their foreign aid, it at all, the proba¬
dollar reserves during the second bility is that it will not reduce
Quarter of 1952 by an amount es- appreciably the amounts made
timated at nearly $400 million, available in 1953, since there will
rrilis improvement did not occur not only be some carry-over but
commitments
already
in¬
'an equal degree in all countries, also

capital investment without refhere with any de- Prence to what fund'? are available-1$**1 with a few exceptions at least curred,
particularly on the mili¬
tailed survey of the purposes and
for thisW>se
short
6ome Sain was recorded. There tary side. Thus, barring some rapid
justifications advanced for these have
attempted to draw on slender was a further improvement of ap- changes in world conditions, the
programs. What I do wish to con— resources without in
any way cur—
proximately .one—half billion dol— 1953 dollar supply is likely to be
sider briefly is why, despite these
lars
in
the
tailing consumption.
"" third quarter, but kept at or close to the 1952 levels,,
"■*"*
' '
vast dollar outlays, there is still
many factors contributing to this excluding
for the moment the
such pressure on the demand side
Capital Shortage, Not Dollar
gain in reserves related to tem¬ matter of capital investment. WitK
as
evidenced by the retention of
Shortage
porary or unusual circumstances, respect to the dollar demand, the
exchange and import controls in
Not to over—simplify the issue
such as large seasonal travel ex— near-term prospect is for some
so many countries.
it may be suggested that what we penditures by Americans, a de- slight continued upturn. The main
The
1950-52
experience may have had throughout much of the dine in U. S. exports particularly question here, however, is wheth¬

to

detain

you

In^

furnish

a

clue.

Beginning

last quarter of 1949

which

had
from

ward

been

the

in the

U. S. imports

drifting

first

of

down-

the

year

moved

upward
without
check
through the first quarter of 1951,
in part stimulated by the needs
and fears

arising out of the onset
Foreign pur-

of the Korean War.

chases in the United
other

the

hand,

third

fell

States,

off

on

the

sharply

in

fourth

and

quarters of
1949 and continued at this reduced

level until the last quarter of 1950.
This decline undoubtedly stemmed

Two weeks

gested

and

by the United States Gov-

*

some

*

but

ernment, either directly or indirectly through participation in the
stitutions. From 1946

merely

J"epFfsents a ®kift at first sources,
opportunity away from other

the

work of various international in-

tion of the bull market.

demand

has

bv

possipie oniy py tne resents

of

this

abao-

these
tnese

purchases

nossible

made
maae

loans

instances

expenditures.

in

some countries

apparent down¬

an

second half of 1952. Since com- uncertain, namely, the level of
mercial exports during the early domestic economic activity and
part of 1952 had shown strength, it the amount of governmental aid
was noted that there could be a de- or expenditures abroad. There
cline in the second half of some have been some suggestions that

,

go

swing

well

as

tures during the first half of 1952;
The revised estimates still assumed, forecast, I should like to indicate
however, a considerable accelera- some of the influences which are
tion of these expenditures during likely to prevail.
The dollar supply side obviously
the second half of the year. On the

thl

Slaved
^!i

sections,

intensification of
imports and ex¬

1951, the overall total (including Even the most skeptical of per¬
military-end items under the Mu- sons cannot entirely shake off the
tual Security Program) would be feeling that the reader of tea
slightly higher. In June this Group leaves and the caster of horoscopes
again
checked
their
estimates might be right. I would venture

S. exports
slight dip,
continued on into the first half
of this year. Imports into the
United States, however, dropped
abruptly in the third and fourth
quarters of 1951. The two opposing
forces thus combined to start a
new drain on foreign reserves.
expected levels of such expendiconsequent rise in U.

supply. Thus,
yet, as we have seen, despite
icance
is
now
foreign expenditures rose from the drop in import expenditures
counted.
On the more basic about $15 billion in 1946 to
nearly between the first and second half
fronts of national and inter¬ $20 billion in 1947, then dropped 0f
195^ the total outlay on comnational economy, the prob¬ to $17 billion in 1948, $16 billion mercial, capital and government
in 1949, and $14.4 billion in 1950.
aid account reached an all-time
lems are far from being set¬
As a result, in the latter year the
high for the year as a whole. Thus,
tled.
There
are
too
many gap between commercially sup- the dollar crisis which hpcamo the
wheels within wheels for plied and commercially used dolsubject of concern in the latter
Eisenhower, Dulles or Wilson lars was virtually closed. In 1951, part 0f 1951 particularly that of
however, the gap again widened the sterling' area, were almost
to make any rapid changes.
as expenditures moved up to more
wholly due to a new expression
*
*
*
than $20 billion.
0f foreign demand.
Over the period there has been
n'T
+w
Basically, however, it is the
a p/Sfntrit ^hrniithmit
action of the current stock only a slight upward change in
transportation, travel and miscelhaw
market that interests us the
laneous
Interest

the

the replenishment of foreign gold
and dollar reserves. It was then

dollar

services account.

government aid,
available to for¬

made

aid disbursements. There was also generally felt that while commerundoubtedly some running down cial exports in the ordinary sense
of inventories and postponement would run somewhat less than in

final

commercial dollars.

be

lion would be utilized in the pur¬
chase of U. S. goods and services,
with

there has been

estimated that in

including

would

or

on

the basis of their interest

this subject,

lion,

than $10-$11 billion,

more

in

on

1952 somewhere around $23 Vi bil¬

place orders as demand from the
Thus, the reasons for the ever- United States drove up prices of
present "dollar shortage"—which, raw materials. As a result of these
incidentally, is in itself a per- opposing movements, foreign gold
nicious
term—must
be
sought and dollar reserves gained subelsewhere
than in a dearth of stantially in each quarter. In the
value of

Most

to look forward to. But

rences

no other funds been
these expenditures alone
enough to sustain exports

provid'ed,

already taken for

granted that the Excess Prof¬
its Tax will also be dropped.
.All these are pleasant occur¬
because

"

•

is

plenty of encouragement.
It looks like the incoming ample, had

balance of pay-

position and outlook. Early

of

those of the author only.]

Balance of

economic basis there

an

glance at

this year the NFTC Balance of
the Payments Group, comprising inpresented as dividuals drawn from
member

those

with

Trade, Finance and

*

ments

a

re-

perhaps

anicle do *ot ne??*saply a\

see

reaction.

a

time

our

should be devoted to

-

—

continued

sai(? ?n these matters, the
of

many

change. Thirdly, in

might profitably be

more

mamder

,

expected.
^

views

While

in

imposition

restrictions

Current Balance of Payments

a

credit
as

is a*10*116* question,

But

other factors.

on

many

have

obiectives

trading

setback

a

capable of hurdling without a off-hand

Markets
Walter

I

Now

more.

Thursday, November 27,1952

...

from

several

spread
in

causes:

devaluation

of

the

wide-

currencies

Sept. 1949; the introduction of

new

exchange

restrictions

and

other conservation measures; and

some. the decline in U. S. Government

world and, for that

tinue to have, is
capital rather than

a

they'

matter, conshortage of

a shortage of
dollars. Two impatient pressures
have been at work, one for an

cotton, the incidence of the steel
strike, and some speed-up in purchases by the United States. Cornmercial exports in July, particularly

of

exports

manufactured

immediately improving standard g°°ds were either at or not far
of living, the other for immediate from the bottom. Since that time
large-scale capital development,
Despite increasing production, the
growth has been insufficient to
meet both to the desired degree,
with the result that a further
shove has been given to the forces

of

there has been a gradual increase,
which is expected to continue for
at least the next few months,
There
work

has; in

been

the

advanced

strictly

for

to

personal

consumption,

at

least

results,

these

produce

which

down,

reserves

there
on

has

were

been

the part

drawn

sibly

intended

to

fill

the

Secondly,

there

has

and

been

in
a

continue

Ho* "do

so

or

will

permit gradually greater expendi¬
tures on imports. The action to be
taken

undoubtedly will vary sub¬
stantially from country to country
depending on the specific situa¬
tion and position there prevailing.

however,

are,

some

signs

that foreign countries will attempt
to

mop

power

excess

purchasing

and, thus, relieve the

sure on

ments.

up

their
To

pres¬

balances of pay¬
extent that this is

own

the

strong

successful, the demand for dollars
will be somewhat reduced. More¬

a

the 'governments to make every effort
most

will

replenishing
their reserves

now

strengthening

of foreign

greater proportion has been osten- rto strengthen the reserve position,

pressing capital requirements,

the countries

and

There

two

First, after the experience of 1951

support of the standard of living .Tendency
and

been

and possibly three major forces at

inflation. ^While some of
aid from the,sUnited States

the

have

er

consequence,

tightening

of

over,

it

countries

is

apparent

that

many

giving increasing
thought to how best they can ad¬
just their position to eliminate
are

Volume 176

Number 5172

The Commercial and Financial Chronicle

..;

(2053)
the need for dollar
aid and get on
a
pay-as-you-go basis.
From the long-term

annual

such

there is every reason to
expect a
continued increase in the commer¬

taste

fill

these

foreign

increased

the

case

of

Dollar

ing

re¬

whether
liberal tariff

more

that

with

program

be

the

continue

emphasized,

form

undergo
changes.

have to
zation

the

some

For

Securities

be

and

postwar

in

this

de¬

well

may

least

at

to

amorti¬

.the

on

loans

total

need

goods and make domes¬
tic production competitive. There

is,

therefore,

that

these

as

to

reason

operations

In

proceed

vestments.

To

quote

statement made last year from this

as

platform: "We all have heard

same

lot

in

a

postwar

underdeveloped

vestments

it American Buyers Credit Co.,
Phoenix, Ariz.
17 (letter of
notification) up to 300,000 shares

Nov.

to

—

us

let

is

other

to

realistic,

our

our

payments is in

a

Nearly everyone
the important need

ognizes

are

same

ones

★ Atlantic Finance Co.,
Spartanburg, S. C.
Nov. 17 (letter of
notification) $200,000 of 12-year 6%

&

Cable

Corp.

100,000 shares of

be

filed

by

respectively.

convertible debentures (in denominations
each). Price—At par. Proceeds—For

$20
working
capital. Address—P. O. Box 2265 A,
Spartanburg, S. C.

Underwriter—None.

British

and

(letter
stock

share to stockholders and $5.75
to public.
Proceeds—To remodel plant and
purchase
new
machinery and for working capital.
Underwriter
per

—Mohawk

Valley Investing Co., Inc., Utica, N.
Y.,
10,000 shares.

Cleveland

(par $5).

-

their rights. Price—At par. Proceeds—To
repay
500 of outstanding notes and for

drilling

Underwriters

—

Dallas

$1,014,-

expenses and

Rupe &

Son,

^Dallas, Texas; Carl M* Loeb, Rhoades & Co., New York;
and Straus, Blosser &
McDowell, Chicago, 111. Offering
—Postponed until after Jan. 1, 1953.

it Canadian Prospect Ltd., Calgary, Alta., Canada
Nov. 24 filed 303,595 shares of1 common
stock

(par 33^
cents), of which 235,000 shares are to be issued upon
exercise of share rights and 68,595 shares are to
be sold
for

account

of

selling stockholders.

plied by amendment.

Price—To be

sup¬

Proceeds—To company to be used

for

operating expenses to pay for future exploration and
development of leases, etc. Underwriters—White, Weld
& Co., New York, for an undetermined number
of shares;
balance through a Canadian underwriter to be
named
later.
Cincinnati Enquirer, Inc.
July 25 filed $2,500,000 of 10-year convertible junior
debentures due Aug. 1, 1962. Price—To be
supplied by
amendment.
mouth

Steel

Proceeds—To pay notes issued to the Ports¬

Corp.

Underwriter—Halsey, Stuart & Co.
Offering — Temporarily

Inc., Chicago and New York.
postponed/




As

I

come

address,

I

to

the

realize

close of tisfe*

that

there

are

many other aspects of the balance
of payments which have been
by¬

passed

or
but
lightly touchedis, for example, the rela¬
tionship between the United States*

There

and

specific areas. There is the
question of the directional effects?
on

trade

our

investment.

of

foreign

aid and.

Both of these deserve

consideration, but, to paraphrase
the

words

nouncer

on

any

with which the an¬
closes each day's episode

one

of

a

serials, this is

a

number of radfo

continuing anacl

in fact, never ending
story..

ADDITIONS

PREVIOUS

ITEMS

REVISED

ISSUE

of

and

two

for

means

transferring dividends and inter¬

(par $1) to be initially offered to stockholders aft
one
preferred share for each five shares heUst

rate

one

held.

share

of

Price—For

common

stock

preferred,

for

$8.50

each

two

shares

share, and fear
common, $6.50 per share. Proceeds—For working capi¬
tal. Underwriter—Coburn &
Middlebrook, Inc., Hartfori^

—

Electric

Illuminating Co.

(11/28)
stock (no par) to

Oct. 22 filed 557,895 shares of common
for subscription by common

be offered

record Nov. 24 at the rate of

shares

per

Conn.

on

•

,

,

stockholders of

record

shares

Price—$43.25 per share. Pro¬
ceeds—For property additions. Underwriter—None.
Commonwealth
6

filed

ferred stock
common

Edison Co., Chicago, III.
1,155,730 shares of $1.40 convertible pre¬
(par $25) being offered for subscription by

stockholders of record

prefererd share for each 12

Nov.

24

at

rate

of

shares held.

common

one

Rights

Price—$31 per share. Proceeds—
For construction program.
Underwriters—Glore, Forgan
& Co. and The First Boston
Corp., both of New York.

it Commonwealth Stock Fund, Inc., San Fran., Cal.
21 filed 250,000 shares of common stock
(par $1).
market.

Proceeds—For

investment.

Dec.

Under¬

,

$16,484,000 of 3V4% convertible debentures due
18, 1967 to be offered for subscription by common
at rate

of $100

a.m.

(EST)

on

to

.♦.

i-

share

for

each

four

through

long-term

debt, will be used for expansion program.
Underwriter—Alex. Brown & Sons,
Baltimore, Md.

Deerpark Packing Co., Port Jervis, N. Y.
(letter of notification) 235,000 shares of com¬
mon stock (par 10
cents).
Price—$1.25 per share. Pro¬
March 21

ceeds—To repay RFC loan

capital.

of $41,050 and for working:

Offering—Expected before Oct. 15.

rehabilitation

—

stock

(par

com¬

one

.

Electronics &
Nov.

10

mon

Nucleonics, Inc., N. Y.

stock

(letter of notification) 1,200,000 shares of com¬
(par one cent). Price—25 cents per shares

Proceeds—To expand current operations and for work¬
ing capital. Underwriter—To be furnished by amend¬

11

Dec. 1 at office of company.

Copperweld Steel Co., Glassport, Pa.

new

on

cent). Price—Five cents per shares
Proceeds—For equipment and
working capital. Under¬
writer—Tellier & Co., New York.
^

First Boston Corp.,
Co., and Wertheim
Co., Inc. and Alex.
received up

one

Dec. 2. Price—To be sup¬
plied by amendment. Proceeds—From sale of stock, to¬
gether with other funds expected to be obtained

mon

held; rights will expire

Halsey, Stuart & Co. Inc.; The
White, Weld & Co., Lazard Freres &
& Co. (jointly); Harriman Ripley &
Brown Sons (jointly).
Bids—To be

of

it Electronic Devices, Inc., Brooklyn, N. Y.
Nov. 18 (letter of notification)
3,000,000 shares of

of deben¬

Dec. 18. Price—At par (flat). Proceeds—To finance ex¬
pansion program and repay bank loans. Underwriters—
To be determined by competitive bidding. Probable bid¬
ders:

rate

the warrants will be mailed

Office

Nov. 5 filed

stockholders of record Dec. 1

at

and development
program
Suite 839, 60 East 42nd St., New York
17, N.-3L
Underwriter—Gardner & Co., New York.

Consolidated Gas, Electric Light & Power Co. of
Baltimore (12/1)

Dec.

1

held; rights to expire Dec. 16. It is anticipated thttfc

Devil Peak Uranium, Ltd.
(Nev.)
April 7 (letter of notification) 600,000 shares of commas*
stock (par one cent).
Price—50 cents per share.
Pro¬

Nov.

Price—At

Corp. (12/2)
Nov. 12 filed 160,666 shares of common stock
(par $1)
be offered .for subscription by common stockholders elf

Dec. 19. Warrants will

be mailed about Nov. 28.

Nov.

Davison Chemical

share for each five

one new

held; rights to expire

for

Byrd Oil Corp., Dallas, Tex.
Oct. 22 filed $1,750,000 of
10-year 5%% convertible sink¬
ing fund mortgage bonds due Nov. 1, 1962, to be offered
for subscription by common
stockholders at the rate
of $100 of bonds for each 28
shares of stock held (for
a 14-day standby).
Certain stockholders have waived

working capital.

in order to provide the
est.

•

ment.

(12/9-10)

Elyria Telephone Co., Elyria, Ohio
17 (letter of notification) 2,122 shares of comment
(no par) and 5,600 shares of 5% preferred stotik:
(par $50). Price—Common stock at $7,476 per share,

Nov. 17 filed 70,000 shares of cumulative preferred stock

Oct.

(par $50). Price—To be supplied by amendment. Pro¬
ceeds—To be used, together with other funds, for purchase of at least 80% of common stock of Ohio Seamless

stock

,

.

encouraged

The

more important it will be
expand the current dollar supply

SINCE

stock

stock

Proceeds—To

Underwriters

tures for each 30 shares of stock

Manufacturing Co.

of notification) 58,435 20/26 shares of
(par $1) being offered for
subscription by
common stockholders of record
Nov. 13 at rate of one
jnew share for
each 5Vs shares
held; rights to expire

.

of

United

Assuming,
however, that the way is opened,

Van Alstyne,
Weeks, both of New York.
Offering—Expected week of Dec. 8.

common

by amendment.

up to

lack

cesr-

aid.

increased;

the

return to the cir¬

which

Noel & Co. and Hornblower &

•

,

stock (par $1).
Price—Approximately 64.48 cents per share. Proceeds—
To acquire leases and for
corporate purposes. Under¬
writer—None. To be named

Price—$5

a

ceeds?—For

Toronto, Canada

Sept. 25 filed 1,000,000 shares of

Nov. 28.

the

investment.

writer—None.

5

a

in many instances the
who
would
most

(12/8-11)
common

amendment.

subordinated

common

the

from

cumstances

rec¬

will expire on Dec. 10.

Nov.

been

ignored

or

deplore

strongly resist

sad state of equi¬

librium."

who

States

a penny be¬
technical friends tell us

international balance of

our

forgotten

investments

of

one

often

Those

nations.

no

going to invest

cause

that

be

us

so

stockholders, Max B. and Sol Cohn, President and Vice-

—

Brunner

a

that in the heyday of British
investment abroad, the world was
a different
place than it is today.

countries, in¬
foreign trade

close

responsibilities
But

17 filed

President

•

Bldg., Phoenix, Ariz. Underwriter—None.

Ltd.,

have

sums

of

Registration

Price—To

of

issued upon exercise of stock
options

(minimum 50,000 shares).'Price—At
par ($1 per share).
Proceeds
For working
capital. Office
410 Security

Oils

stroke

of governmental
this investment is

/

—

Bristol

the

shining example of what

••

sinking fund convertible
debentures due June 30, 1962.
Price—At par. Proceeds—
For working
capital.
Office
Houston, Tex. Under¬
writer—C. K. Pistell &
Co., Inc., New York. The pro¬
posed offering of preferred and common
stocks have
been withdrawn from
registration.

of

sation
more

highly developed nation should do
by way of capital exports. What

of

years

gaps and investments to meet

Circle Wire
Nov.

these

by the

investment

increase of

an

mentioned, most of them ranging
from $5 billion to $10 billion and
up.
Eighteenth and Nineteenth
Century Britain has been held up

short

one

and

Various

pen.

altered.

connection, one final
the future of capital in¬

on

annual

though

exhortation

this

word

its

as

the proportions
apparently envis¬
aged could be brought about by

believe

the trade pattern will be

of

abroad,

established, then

it well may be that the total dol¬
lar supply will be further
enlarged
and that private investment wM
take up the slack left

it INDICATES

in

Nov. 24

common stock to be

coun¬

the

on

is

It

important

Now

Allpark Finance Co., Inc.
Aug. 28 filed $500,000 qf 6%

down

for dollar

to

intergovernmental

(letter of notification) 2,000 shares of
common
$2.50). Price—At market (about $6.50
per
share). Proceeds—To William S.
Wasserman, the selling
stockholder.
Underwriter—None, but Vilas & Hickey,
New York, will act as
broker.

cut

this, for
the United States

even more
emphatically been
admonished that it must raise the

is

service

(par

to

beyond

has

economic aid, technical assistance

example,

debt

in various

programs

But

some years now

go¬

which

committed

the

now

however,

highly

vestment.

supply. One objective of the pres¬
industrialization and produc¬

tries is

of increasing the flow that the
requisites for attracting
legitimate, private capital in¬ investment
are

of

up

ent

tivity

401

desirability

private

on

a

★ ACF-Brill Motors Co.
stock

Also, remittances of

re¬

part of the dollars accruing to
foreign countries will presumably

a

credits.

interest and dividends

come

mand will be expressed

questionable,
even

more

appear

throughout the world.

on

should

manu¬

Barring a return to a strong
protectionist policy by the United
States, there should be a gradual
increase in expenditures on this

however,

will

long time to

a

gardless of developments

clear.

of product. It is

would

demand

heavy for

factured items the situation
is less

type

be

may

than

supply, especially
foreign travel, also are likely to
a
steady rise. With the ex¬
ception of travel, however, the
outlay will probably rise very
slowly.

foreign
countries, assuming that
they are
to

and

show

This force alone would
mean an
expansion in the dollar
supply made available to
able

appreciably to the

looking at the U. S. balance
of payments alone. Other elements
in the dollar

supply for most major

quirements. In

be

from

levels

materials.

will

outlay, in view of the capital investment will take
buying habits of the another sizable segment of

significant

of demand
compared with
prospective supply indicated
that
the United States
would become
of

increase

however, the gain

the United States for
basic mate¬
rials. In its
Report the Paley Com¬
mission suggested that
projected

sources

of

public as well as the
competitive vigor of American in¬
dustry. For individual countries,

Attention has

on

and

American

been frequently
drawn, most re¬
cently by the Paley
Commission,
to the increased
requirements of

increasingly dependent

to add

as

total dollar

viewpoint

cial dollar
supply.

rate

-

preferred stock at

Tube Co.

par. Proceeds—For new construction^
etc. Office—330 Second
St., Elyria, Ohio. Underwriter—

Crown Drug Co., Kansas City, Mo.
Sept. 18 (letter of notification) $250,000 of 4%% con¬
vertible debenture notes due Oct. 1, 1962 being offered

^Ar'Emerald Gas & Oil Co., Inc., Seattle, Wash.
Nov. 17 (letter of notification)
1,000,000 shares of

(157,304 shares outstanding) at $55 per share.
Underwriter—Riter & Co., New York.

for prior

subscription by stockholders of record Oct. 17;
rights to expire on Nov. 28. Price—At par (in denomina¬
tions of $60, $100, $500 and $1,000 each). Proceeds —
For working capital. Office—2210 Central
St., Kansas
City, Mo. Underwriter—Business Statistics Organizations,
Inc., Babson Park, Mass.

it Crown Finance Co., Inc.
Nov. 19 (letter of notification)
$250,000 5% subordinated
debentures due 1983. Price—At par
(in denominations of
$1,000 each). Proceeds—For working capital, to reduce
debt, for expansion and investments.
Underwriter—
Hodson &

Co., Inc., New York.

it Daitch Crystal Dairies, Inc.
Nov. 20 (letter of notification)
3,000 shares of

common

stock (par $1). Price—At market
(about $6.75 per
Proceeds—To Louis Daitch, Chairman of the

is

the

Hirsch

selling
&

Co.,

stockholder.
and

Thomson

Underwriter
&

—

McKinnon

share).
Board, who
None, but

may

act as

brokers.
•

Danielson Manufacturing Co. (12/1-3)
6 (letter of notification) 5,526 shares of
preferred stock (par $5)' and 10,000 shares of

Nov.

class A
common

None.
*'

mon

shares

(par 10 cents).

*

'

*

com¬

Price—25 cents

per share
Address—c/o George
Lusch, Beyers Bldg., Seattle, Wash. Underwriter—None.

Proceeds—For drilling expenses.

Continued

on

page

42

The Commercial and Financial Chronicle

(2054)

Continued

Ispetrol Corp., New York
29 filed 49,500 shares of common stock. Price—At
par ($100 per share). Proceeds—To finance purchase of

jrom page 41

Empire Oil Corp., Tulsa, Okla.
Nov
stock

(par 5

Tulsa, Okla.
Schenin Co., New York.

writer—I. J.

oil

Federal

and

panelboard.

Underwriter—H. M. Byllesby &
★

Florida

Power

Co.

&

★

Oct.

(letter of notification) 3,000 shares of common
Price—$100 per share. Proceeds—To acquire cer¬
of Rudd-Melikian, Inc., of Philadelphia, Pa.,
and for working capital.
Office—Philadelphia, Pa. Un¬

(EST)

Leavell

& Bates, Inc., Tipton, Ind.
(letter of notification) $100,000 of 5*4% sinking
fund debentures, 1952 series. Price—At par (in denomi¬
nations of $1,000 and $500).
Proceeds—To make small

Nov.

on

Shaver

(par
per

of

&

$1).

Price—At

Canada.

plied by amendment.

Mississippi Chemical Corp., Yazoo City, Miss.
Sept. 29 filed 2,000,000 shares of common stock (par $5),
of which 849,038 shares have been subscribed, paid for

of

(estimated

Nov.

on

Eastman,

common

at

Oct. 23

about

lative

Dillon

15,

Co.

&

will

act

$250 debenture and 25 shares of stock.
unit.

per

Proceeds—For

1601, Westward
Underwriter—None.

as

Hotel,

Phonix,

Ariz.

Price—To

be

supplied by amendment.
Proceeds-—For
engineering and construction of prototype coaxial heli¬
copter.
Office—St. James, L. I., N. Y.
Underwriter—

stockholder.

increase

Price—At

($10

par

working capital.

per

cumu¬

share)

Underwriter—

Price—At

($10

par

share).

per

and

furnishings of
Room 4, Cornet
Bldg., Las Vegas, Nev.
Lester L. LaFortune, Las
Vegas, Nev.

common

Proceeds—For
motel.
Office—
Underwriter—

★ Hoosier Crown Corp., Crawfordsville, Ind.
(letter of notification) $100,000 of 5% sinking
fund debentures, ' 1952 "
series, due Oct. 1, 1962, with
stock purchase warrants
attached; and 2,000 shares of
common stock
(no par) covered by stock purchase war¬
rants which give the owner the
right to purchase common

<*/Nov. 19

stock in

units of

10

shares

each

per

$500 debenture at

$220 per 10 share unit. Price—Of
debentures, at par.
Proceeds—For working capital. Office—100 Harrison
St.,
Crawfordsville, Ind. Underwriter—None.

★ Hugoton Production Co., New York
Nov. 21 (letter of
notification) 2,200 shares of
stock

(par $1). Price
share). Proceeds—To
receive

fractional

—

market

common

shares

dividend payable Dec.
Idaho

At

in

common

(about $44.50

stockholders

connection

per

entitled

with

5%

to

stock

1, 1952. Underwriter—None.

6

filed 200,000 shares of common stock
(par $1).
Price—At market (on the San Francisco Stock Ex¬

change). Proceeds—To selling stockholder (Gwendolyn
MacBoyle Betchtold, as executrix of the last will and
of

Francisco-

Calif.

Errol

Bechtold,

Underwriter

—

Dean

Witter

&

Co.,

deceased).

Office—San

Underwriter—None.

International Glass Corp.,
Beverly Hills, Calif.
Sept. 22 (letter of notification) "299,635 shares of com¬
mon
stock, to be issued as follows: To William Hoeppner, 6,985 shares; to stockholders of Soft-Flex Glass

Corp.,

17,650

Price—At

par

shares; and to public, -275,000
($1 per share).
Proceeds—For

general corporate purposes.

Drive, Beverly Hills, Calif.
Co., Beverly Hills. Calif.

Office—119
•

South

Beverly
&

Underwriter—Douglass

★ International Industries &
Development, Inc.
Nov. 20 (letter of
notification) 80,000 shares of common
stock (par 10
cents). Price—$2 per share. Proceeds—To
acquire formula for cleaning silver and silverware and
for working
capital. Office—15 William
Street, New
York 5, N. Y. Underwriter
George B. Wallace & Co.,
—

New York.




(par 10 cents).

per

share.

common

Proceeds—
Underwrite!

expenses.

—Aetna Securities Corp., New York.,

★ Mt. Union Mines,
Nov.

17

Inc.,

Reno, Nev.

(letter of notification) 2,167,806 shares of non¬

assessable capital stock

(par 10 cents), of which 122,000

shares will be offered at 16 cents per share and 1,522,106
,

at

offered

10

and

cents

per

issued

to

share, with
certain

Proceeds—For

rendered.

St., /Reno, Nev.

the

balance

individuals

construction

—c/o Nevada A-gency & Trust Co.,

San

of

for

be

to

services

mill.

Address

139 North Virginia

Underwriter—None.

Multicrafters, Inc., Lincolnwood, III. (12 8)
•
Oc|. 28 (letter of notification) 99,900 shares of. 6% con¬

Magma Copper Co.
vertible prior preference stock. Price—At par ($3 per
7 filed 266,227 shares of common stock
(par $10) * shaVe. Proceeds — For new machinery and equipment.
being offered for subscription by stockholders of record * Office—3517
Touhy Ave., Lincolnwood, 111. Underwriter
26

at

rate of
onevjiew share for each 2% shares
held; subscription rights to expire Dec. 11.
:Price—$24.50 per share. Proceeds—Sufficient to provide

—Steele & Co., New York.

stock

•company

*will

with

Copper Corp.,
with

the

Co.,

New

authorized

$94,000,000.

to

it

by

Underwriter

York.

the

RFC

in

the

Lazard

Freres

&

working capital. Office — 532 Security Bldg.,
Phoenix, Ariz. Underwriter—Weber-Millican Co., New
'York.
./
'
/■•/
★ Maine Slate Products Corp., Bangor, Me.
Nov. 17 (letter of
notification).299,970 shares of common
stock (par 10 cents).
Price—$1 per share.
Proceeds—
For machinery and
equipment. Office—8 Harlow Street,
Bangor, Me. ^Underwriter—Charles J. Maggio,
Inc.,
New York.

Marsh Steel Corp.,

North Kansas City, Mo. $500,000 of 5% debentures, series A, due
$50,000 annually from Nov. 1, 1953 to. Nov. 1, 1962, inclu¬
27 filed

sive.
For

Price—At

100%

working capital.

of

principal amount.

Proceeds—

Underwriter—The First Trust Co.

(Neb.).

★ (J. W.) Mays, Inc., Brooklyn, N. Y.
Nov. 19 (letter of notification)
27,000 shares of common
stock (par $1), to be offered for
subscription by em¬
ployees. Price—$9 per share in some cases; $8 in others.

Proceeds—Approximately $81,965

to reimburse company
for purchase of 9,000 shares from Joe
Weinstein, Presi¬

dent;

balance for

general

corporate

purposes.

Under¬

writer—None.

McCarthy

•.

"

•

"Not*"6

^letter of notification) 13,200 shares of common
(par $5).'Price—At market (approximately $7.50
share). Proceeds—To Edward B. Horner, Oscar B.

stock
per

Drinkatd
.holders.

■

cents). Price—$2 per share. Proceeds
exploratory wells, acquisition of leases

—

stock

For

and

(par 25

drilling of

for general

Underwriter—B. V. Christie & Co.,
Dealer Relations Representative—George

Houston, Tex.
A. Searight, 50
Broadway, New York, N. Y.

Telephone

Offering—Date indefinite.

Walter

and

Office

G.

Natural

—

Mason, three selling stock'Bridge, Va.
Underwriter

Scott, Horner & Mason, Inc., Lynchburg, Va. No general
offer

now

planned.

<

/ v

:

New England Telephone &

Telegraph Co.

(12/9)

Nov. 7 filed $20,000,000 of 25-year debentures due Dec.

15, 1977. Proceeds—To repay advances received from
American Telephone & Telegraph Co., the parent. Un¬
derwriters—To

be

determined

by competitive bidding.
Halsey, Stuart.& Co. Inc.; .Morgan
Stanley & Co.; Gloer, Forgan & Co.; Kuhn, Loeb & Co.
Bidjs—vTq be received up to 11 a.m. (EST) on Dec. 9 at
Room 2315, 195 Broadway, New York, N. Y.

Probable bidders:

★ New England Telephone & Telegraph Co. (12/12)
of capital stock to be offered

No\i 20 filed 232,558 shares
for

|ubscription by stockholders of record Dec. 10

of

gpfie new share for each ten shares held; rights to
On Jan. 12. Subscription rights will be issued on

at rate

expire
To

common

..

Natural Bridge of Virginia, Inc.,,

Dec| 12/Price

(Glenn), Inc.

June 12 filed 10,000,000 shares of

WHitehall 3-2181.

.

★

..

,

1

1,000 shares of common
(par $10). Price—At market (estimated at from
$17 to; $20 per share). Proceeds—To Willis King Nash,
the selling stockholder. "Underwriter—J. M. Dain & Co.,
Minneapolis, Minn.
stock

—For

*

Co., Minneapolis, Minn.

Oct; 21 £;(letter of notification)

.

.

Nash Finch

<

—

Nov. 12 (letter of notification) 553,500 shares of common /
stock (par 10 cents).'Price—50 cents
per share. Proceeds

Oct.

Sejit 8 (letter of notification) 150,000 shares of common
stoek. v Price—At market (approximately 10 cents per
share), Proceeds—To George W. Snyder, President.. Un¬
derwriter^—Greenfield & Co., Inc., New York.
/
•;

minimum of $6,000,000,- after expenses,
provide additional funds to San Manuel
wholly-owned subsidiary, in connection

loan

amount of

,

'Multiple Dome Oil Co., Salt Lake City, Utah

a

be used to

corporate purposes.

Fabrics

Underwriter—None.

Price—$1
For exploration and development

★

of Lincoln

Maryland Mines Corp.

testament

stock

shares

Magma King Manganese Mining Co.

★ Hawthorne House of Nevada, Inc.
Nov. 17 (letter of
notification) 30,000 shares of
construction

con¬

The remain¬

Nov.
'

None.-

stock.

will be issued in

Corp. (N. Y.)
Steptj»J.9 (letter of notification) 300,000 shares of

Francisco, Calif.

of

350,000 shares of class A common stock
(par $1), of which 50,000 shares will be issued to stockholders, directors, officers and employees for services
rendered and 300,000 shares will be offered to
public.

stock.

4

Nov.

filed

preferred

Corp., Paramount, Calif.
(letter of notification) 1,470 shares of common
stock (par $1).
Price—At the market (about $10 per
share). Proceeds—To Mrs. Helen R. Davis, the selling

Of¬

Gyrodyne Co. of America, Inc.
13

additional 107,550 shares have been

of Aug. 28 and

Montana Basin Oil

Macco

Price—

construct ion»

new

Ho

Co., Inc., N. Y.
(letter of notification) 29,000 shares of 6%

Louis L. Rogers Co., New York.

★ Greyhound Parks of Arizona, Inc., Phoenix, Ariz.
17 (letter of notification)
1,198 of 6% cumulative
debentures (in denominations of $250 each) and
29,950
shares of common stock (no par) to be offered in units

fice—Room

an

as

and

construction.

Proceeds—To

Under¬

1952.

Nov.

one

for

ing shares will be offered for sale primarily to farmers
fhrm groups. Price — At par.
Proceeds — For new

Underwriter—City Securities Corp., Indian¬

★ Lee Paper Co., Vicksburg, Mich.
13 (letter of notification) 30,000 shares of common
stock to be offered for subscription only
by stockholders
of record Aug. 18. Price—At par ($10 per
share). Pro¬
ceeds—For working capital. Underwriter—None.

Nov.

$250.25

issued, and

nection with expansion of ammonia plant.

Nov.

share). Proceeds—To be distributed to hold¬
but

and

(letter of notification)

small loans.

Underwriter—Brewis & White, Ltd., Toronto,

Names of United States underwriters to be sup¬

Lowell Adams Discount

219 shares

market

scrip which ..expired

writer—None,

shares.

properties.

subscribed

17

apolis, Ind.

broker.

June

share for each two shares purchased in
two, three, or
five years, at $1, $2 and $3 per share,
respectively. Price
—For 2,000,000 shares, $1 per share—Canadian.
Pro¬
ceeds—For exploration, development and acquisition of

Inc., Tipton, Ind.
$25,000 of 5*4% sinking
debentures, 1952 series. Price—At par (in denomi¬
nations of $1,000 and $500 each).
Proceeds—To make

unsubscribed shares.

new

Exploration Corp., Ltd., Toronto Canada
filed 2,000,000 shares of common stock, each
share to have attached an "A," "B" and "C"
warrant,
each giving the holder the right to buy one additional

fund

1091, Ocala, Fla. Underwriter—
Co., St. Petersburg, Fla., will offer

★ Food Fair Stores, Inc.
Nov. 20 (Letter of notification)

r

broker.

Mineral

Nov.

None.

Nov.

Under¬

writer—City Securities Corp., Indianapolis, Ind.

Address—Box

of

Office—Citizens Bank Bldg., Tipton, Ind.

Corp. Underwriter—None, but Drexel & Co., will

as

★ Leavell & Bates,

gram.

ers

6

loans.

Florida

$22.23

assets

derwriter—None.

Inc.;

act

July 29

America, Inc.

30

tain

Corp.

a.m.

of

Processors

stock.

1.

stock

Co., Jersey City, N. J.

rities

Veley, the selling stockholder. Underwriter—CompWharton, Philadelphia, Pa.

Kwik-Kafe Coffee

Telephone Corp., Ocala, Fla.
Oct. 27 (letter of notification) 25,500 shares of common
stock (par $10), offered for subscription
by common
stockholders of record Nov. 15 on a l-for-7 basis; rights
expire Dec. 1. Price—$11.75 per share to public and
$10.50 to stockholders. Proceeds—For expansion pro¬

.

ler

Corp., Brunswick, Ga.
(letter of notification) 10,000 shares of common
(par 1 cents).-- Price—At market.
Proceeds—To

ton &

Office — Newark, N. J.
Co., Inc., Chicago, 111.

Bids—To be received in New York at 11

ceeds—To acquire additional properties. Office—927-929
Market St., Wilmington, Del. Underwriter—W. C. Doeh-

Mineral

★ Midvale Co., Philadelphia, Pa.
Nov. 21 (letter of notification) up to but not
exceeding
4,350 shares of capital stock (no par). Price—At market
(about $14.62V2 per share). Proceeds—To Baldwin Secu¬

C. A.

Kidder, Peabody & Co. and Merrill
Lynch, Pierce, Fenner &
Beane (jointly); Lehman
Brothers; Kuhn, Loeb & Co.; Glore, Forgan & Co. and
W. C. Langley & Co. (jointly); The First Boston Corp.
Dec.

Refining Co.

stock

(12/1)
Oct. 24 filed $15,000,000 of first mortgage bonds due 1982.
Proceeds—To repay bank loans and for new construction.
Underwriters—To be determined
by competitive bid¬
ding. The following have been invited to bid: Halsey,
Stuart

&

Kut-Kwik Tool

be

switchboard

Industrial

&

Oct. 31

filed 225,000

Price—To

Mid-Gulf Oil

Nov. 10 (letter of notification) 400,000 shares of common
stock (par five cents). Price—60 cents
per share. Pro¬

Development Corp.
A stock. Price—At par
($100 per share). Proceeds—For industrial and mineral
development of Israel. Underwriter — Israel Securities
Corp., New York.

shares of common stock (par $1).
supplied by amendment (expected to be
between $5 and $6 per share).
Proceeds —To acquire
stock of Powerlite Switchboard Co.
Business—Electric
Nov. 6

amendment.

enterprises and to purchase crude

,jand oil products for resale in Israel. Underwriter—
Securities Corp., New York.

Israel

(12/1-5)

Products Co.

Electric

Israeli

Oct. 6 filed 30,000 shares of class

Equipment Acceptance Corp., Peoria, III.
Oct. 10 (letter of notification) 2,000 shares of common
stock (par $50). Price — $60 per share. Proceeds — For
working capital. Office—3500 North Adams St., Peoria,
111. Underwriter—Paul H. Davis & Co., Chicago, 111.
Farm

★

for

sale

Israel

Under¬

—To drill well. Office—Mayo Bldg.,

oil

crude

shares of common
cents). Price—50 cents per share. Proceeds

(letter of notification) 600,000

6

Thursday, November 27,1952

ing capital. Business—Purchase, processing, refining and
of Fluorspar. Underwriter —"To be
supplied by

Oct.

«</*■

...

^epay

—

At par ($100 per share). Proceeds

—

borrowings made from American Telephone &
-aph Co., the parent, and for other corporate purUnderwriter—None.
Icq

Chemicals, Inc., Detroit, Mich;
(letter of notification) 34,800 shares of common
stock.-Price—At par ($5 er share).; Proceeds—To liquid
datdt notes. Office—8129 Lyndon Ave., Detroit 21, Mich.
Underwriter—None.
"
:
19

•

McGraw

(F. H.)

Co., Hartford, Conn.
Sept. 10 (letter of notification) 5,000 shares of common
stock (par $2) and warrants to
purchase 20,000 shares
of

common

of

one

stock at

share

and

A

$6

per

warrants

-

share to be offered in units '
to

purchase four additional
shares. Price—$19.87^ per share. Proceeds—To
Clifford
S.

Strike, the selling stockholder.
bery, Marache & Co., New York.

Underwriter—Gran-

Mex-American Minerals Corp., Granite
City, III.
3 filed 113,000 shares of 6% cumulative
preferred

Nov.

stock
10

(par $5) and 113,000 shares of
cents) to be offered in units of

class of stock.

Price—$6

per

unit.

common
one

stock

share

of

(par
each

Proceeds—For work¬

★ Northland Oils,. Ltd., Calgary, Alta., Canada
Novi 21\filed 1,000,000 shares of capital stock (par 20

centf—Canadian) and subscription, warrants for 600,000
shares, of which the stock and subscription warrants for
400,0Q0 shares are to be offered in units of 100 shares
of stcick and subscription warrants for 40 shares, Price—^
-852 per unit. Proceeds—For drilling of additional wells
and to purchase producing wells.
Underwriter—M. S.
Gerber, Inc., New York.
Pacific

Telephone

& Telegraph

Oct. 24 filed 703,375 shares

of

Co.

common

(12/4)

stock to be of¬

fered for subscription by stockholders at rate of one new
share for each nine preferred or common snares

held on

Volume 176

Number 5172

The Commercial and Financial Chronicle

.,.

(2055)
Dec.

3; rights to expire

rants will be mailed

Dec.

on

Dec. 4.

on

30.

Subscription

war¬

American Telephone

Telegraph Co., the parent, presently

owns

Schweser's

Oct.

NEW ISSUE CALENDAR

"90% of the outstanding shares. Price—At
par ($100 per
share). Proceeds—To repay advances and bank loans
'and' for

construction.

new

November 28,

Underwriter—None.

Pacific Western Oil Corp.
Aug. 5 filed 100.000 shares of

(around $78.50

>

holders

per

entitled

receive

with 2V2%- stock
Underwriter—None.

Paradise

Aug.
•

in

payable Dec.

15,

',.7

(Bids

Danielson

1952.

11

Debentures

EST)

a.m.

Manufacturing Co
(Coburn

&

Pfd. & Common

Middlebrook,

capital stock.

Price—

(Bids

At par

(10 cents per share). Proceeds—To drill six wells
subleased land and for other corporate
purposes. Un¬
derwriter—None, with sales to be made on a commission
'basis (selling commission is two cents

11

share).

-139

N.

Alex

Virginia St., Reno, Nev.

(Bids

Nov. 14 (letter of
notification) $200,000 of 6% debentures
Nov. 1, 1952 and due Jan.

dated

1, 1968, Price—At par
(in denominations of $100, $500 and $1,000) and accrued
interest. Proceeds—For working
Capital. Office—1402
Finance Bldg., Philadelphia
2, Pa. Underwriter—None.

New

;

December
New Orleans Terminal

Oct. 24 filed 186,715 shares of
capital stock being offered
for subscription by stockholders of record
Nov. 19 at rate
of one new share for each five shares

Pacific

Proceeds

($100

For

—

construction.

new

Underwriter

Circle

share).

per

—

stock

(par

ferred

$1)

10 cents)

and

Proceeds

(par

one

For

—

and

share.

(F.

shares
shares of

100,000

in units of

Price—$1.25

operating capital.

Address

—

of

State

pre¬

one

pre¬

c/o N.

New England

(Goldman,

Sachs

—

equipment and drilling
511, Fairbanks, Alaska.

$1

share.

expenses.

Proceeds

Address—P.

—

O.

(no

Piper,

Jaffray

to

be

interest

be

to

offered

to

present

ployees' Trust Fund. Price—$15.75 per share. Proceeds—
working capital and an equipment expansion pro¬

EST)

12,

1952

stockholders—no

to

December
Garrett

15,

Com.

underwriting)

1952

Freightlines, Inc

Debentures

(Allen

&

Co.)

'
'

'
•

December 17,
(Lehman

Brothers

and

Bear,

Stearns

&

Co.

in

the

stock (par $1).
machinery and
.equipment and new construction.
Business—Production
of heavy duty power transmission
chain, prockets, gears,
-etc
Underwriter—Dallas Rupe & Son,
Dallas, Texas.
per

share.

S.)

EST)

January 7, 1953
New York, New Haven & Hartford RR
(Bids

to

be

to

—

(D. M.) -Co., Bridgeport, Conn.
(letter of notification) $300,000 of
10-year 5%
debentures being offered in
exchange for 4%% cumula¬

be offered

Corp.
298,735 shares of

Underwriter—
-

stock

common

to certain officers and

the

company and its subsidiaries
chase and Option Plan.

;.v

general

corporate

(no par)

other employees of
under the Stock Pur¬

share.

per

Pro¬

Underwriter—

purposes.

• Southeastern Public Service Co.
$
Nov. 18 (letter of
notification) 22,400 shares of common
stock (par 10
cents). Price—At market (about $7.50
per
-share). Proceeds—For working capital.
Underwriters—
Troster, Singer & Co.; Bioren &
Co.; Paul & Lynch;
Barrett Herrick &
Co., Inc.; C. T. Williams & Co., Inc.;
C. D. Robbins &
Co.; Cohu & Co.; Harper & Turner,
Inc.; Stirling, Morris & Bousman; Shea &
Co., Inc.; and
Glidden, Morris & Co.
Southern Radio
Corp., Charlotte, N. C.
(letter of notification) 10,500 shares of common
stock (par $5), and
2,500 shares of 6% cumulative pre¬
ferred stock (par $50).
Price—$12 per share for common
and $50 per share for
preferred. Proceeds—For operat¬
ing capital. Office—1625 West Morehead
Oct. 20

St., Charlotte,

Underwriter—None.

Standard Coil Products
Co., Inc. (12/8)
Nov. 19 filed $5,000,000 of 5%
convertible subordinated
debentures due Dec. 1,
1967, and 250,000 shares of
com¬

stock

mon

13,

1953

Ohio Edison Co

Preferred
(Bids

be invited)

to

Kansas City Power & Light Co
(Bids

to

be

Bonds
Bonds & Preferred

(Bids

11

(par $1). Price—To be supplied by amend¬
Proceeds—From sale of
debentures, to repay bank
loans and for
working capital; and from sale of stock,
to three selling stockholders.
Underwriter—F. Eberstadt
& Co., Inc.
ment.

•

Standard Sulphur Co., New York
7 filed 1,250,000 shares of
common stock

invited)

Ohio Power Co
a.m.

Nov.

cents).

EST)

Price—$1

per

share.

of plant and purchase of
Culver

26,

1953
Common

(Offering

stockholders—no

to

underwriting)

(Bids

11

a.m.

•

Bonds & Pfd.

CST)

(par 10
Proceeds—For construction

equipment and for working
Otis, Inc., and F. L.

Underwriters—Gearhart &
Rossmann & Co., both of New York.
State

Securities, Inc., Santa Fe, N. M. (12/8-12)
(letter of notification) 60,000 shares of class A
Price—$5 per share. Proceeds—
For working capital. Office—440
Cerrillos Road, Santa
Fe, N. M. Underwriter—Paul C. Kimball &
Co., Chi¬
cago, 111. Offering—Expected week of Dec. 8.
Nov.

January 27, 1953
Iowa-Illinois Gas & Electric Co

new

capital.

Corp.

For

3

Emily C. Underwood.
Ames, Emerich & Co., Chicago, 111.

•

Read

Nov.

Walter

S. Underwood and

N. C.

invited)

Common

January

common

Proceeds

Signode Steel Strapping Co.,
Chicago, III.
9
(letter of notification) 2,044 shares of com¬
stock (par $1).
Price—At market (about $17
per
share). Proceeds—To John W. Leslie, trustee of
mon

Bonds

be invited)

January

Manufacturing Co., Longview, Tex.

$2

U.

____Equip. Trust Ctfs.
noon

January 20, 1953

.Sept. 25 filed 250,000 shares of
—

'

Common

(Bids

Underwriter—None.

Powers

'

-

1952

Charter Oil Co., Ltd

Underwriter—None.

2, Ohio.

—

ceeds—For

Bonds

December
(Offering

For

^ Post-Glover Electric Co., Cincinnati, Ohio
.Nov. 18 (letter of
notiifcation) 8,400 shares of common
stock (no par). Price—$21.22
per share.
Proceeds—For
working capital. Office—221 West Third St., Cincinnati

Signal Mines, Ltd., Toronto, Canada
July 14 filed 300,000 shares of common stock. Price—
At par ($1 per
share). Proceeds—For exploration, devel¬
opment, and mining expenses, and to reimburse Maurice
Schack, Secretary-Treasurer. Business—Quartzite min¬
ing. Underwriter
Northeastern Securities
Co., New
York, to withdraw as underwriter.

None.

New England Telephone & Telegraph Co

of beneficial

Em¬

(par five

Sinclair Oil

1952

(Bids

in

(letter of notification) 5,000 shares of common
cents). Price—44 cents per share. Pro- /
ceeds—To Michael L.
Kaplan, President, who is the sell¬
ing stockholder. Underwriter—Willis E. Burnside &
Co.,
Inc., New York. No general offering
contemplated.

to

RR.
noon

leases.

gas

21

Nov. 10 filed

invited)

New York Central RR

participants

Nov.

<Sc.Hopwood).

Ohio Edison Co

Pittsburgh-Des Moines Steel Co.
18 (letter of notification)
9,921 shares

•

and

(Bids

Box

Price—$45
working capital. Underwriter—

Debs.

EST)

a.m.

Debentures
Co.

(Bids

Northeastern

For

par) to be offered to employees.

Nov.

Price

11

Proceeds—

Underwriters—Genesee Valley Securities
Co., Rochester,
N. Y., and White &
Co., St. Louis, Mo.
ir Sightmaster Corp., New
Rochelle, N. Y.

Price—$39.50

due

None.

gram.

Co.)

11,
Southern R.y.-N'ew Orleans &

Underwriter—None.

per share. Proceeds—For

&

Co., Oklahoma City, Okia.
(letter of notification) 150,000 shares of class A

stock (par 50 cents).
Price—$1.75 per share.
To reduce bank loans and
acquire oil and

Oct.
Preferred

December

Pittsburgh-Des Moines Co., Pittsburgh, Pa.
Nov. 18 (letter of notification) 5,000 shares of
common
stock

1952

Equip. Trust Ctfs.

"'.v.'

Underwriters—Goldman,

per

Co.)

December 10, 1952

working capital, capital expenditures

Price

&

.

fr Pioneer Oil & Gas Co., Inc., Fairbanks, Alaska ~
Nov. 13 (letter of notification)
100,000 shares of class A
stock.

&

Wabash RR

company and of one of its subsidiaries,

corporate purposes.

Debentures

Co., Inc.)

Common

(Bids

Sachs & Co., New York; and Piper,
Jaffray & Hopwood,
Minneapolis, Minn.
>

.common

Weeks)

Telephone & Telegraph

1,
1972. Price—To be
supplied by amendment.
Proceeds—About $13,600,000 to retire all of the
present

,

&

Pilisbury Mills, Inc

Dec.

other

&

Kimball

C.

(Riter

Tex.

Pilisbury Milis, Inc. (12/9)
Nov. 19 filed $17,000,000 of
sinking fund debentures

and

Eberstadt

December 9,

Budget Loans, Inc., Minneapolis, Minn.
Sept. 22 (letter of notification) 4,000 shares of preferred
stock, series A (no par).- Price—$24 per share. Proceeds
—For working capital.
Office—227 Twin City Federal
Building, Minneapolis, Minn. Underwriter—M. H. Bishop
& Co., Minneapolis, Minn.

of

Hornblower

Copperweld Steel Co

A.

Phoenix

debt

Common

and

Preference

(Paul

unit.

per

Jr., Mercantile Securities Bldg., Dallas,
Underwriter—Garrett & Co., Inc.,
Dallas, Tex.

funded

&

Securities, Inc

common

Tinker.

.and the balance for

1952

Corp
Co.

Common

underwriting)

(Steele & Co.)

to be offered

common

8,

Cable
Noel

Alstyne,

Underwriter—Blair, Rollins & Co., Inc., New
Offering—Postponed indefinitely.

stock

Standard Coil Products Co., Inc

Petroleum Service, Inc. (Texas)
Oct. 29 (letter of notification)
100,000

stock

Bonds

Multicrafters, Inc

Statement effective Nov. 12.

ferred

Wire &

(Van

None.

1952

EST)

stockholders—no

to

December

Dec. 15. Subscription warrants will be mailed
Nov. 25.
Price—At par

on

about

or

4,

Telephone & Telegraph Co
(Offering

held; rights to

on

EST)

noon

»

$3,750,000 convertible sinking fund deben¬

Seneca Oil
Nov. 10

Co

(Bids

Kidder, Peabody & Co.,

ing capital.

Equip. Trust Ctfs.

noon

filed

York.

EST)

noon

(Bids

1

Sons)

December 3, 1952
York, Chicago & St. Louis RR.,_Eq. Trust Ctfs.

Peoples Gas Light & Coke Co.

expire

&

Seaboard Air Lines RR

Pennsylvania Factors, Inc., Philadelphia, Pa.

•

1952
Common

Brown

—

tures due Oct. 1, 1967. Price—To be
supplied by amend¬
ment. Proceeds—To
repay $1,200,000 loan and for work¬

(Offering to stockholders—underwritten by

fice—c/o Nevada Agency & Trust
Co., Inc., Cheney Bldg..

Seiberling Rubber Co.
Oct.

Chemical Corp

Of¬

Underwriter

Providence, R. I.

Bonds

EST)

a.m.

December 2,
Davison

Newport, R. I.

Common

(H. M. Byllesby & Co., Inc.)
Florida Power Corp

cameras,
Office—73 Bliss Road,

and for other corporate
purposes.

Inc.)

-on

per

St., Los

common

Federal Electric Products Co

3,000,000 shares of

Flower

Productions, Inc., Newport, R. I.
Sept. 8 (letter of notification) 5,000 shares of
non-voting
stock, series B (no par). Price—$10 per share.
Proceeds—To acquire real estate and
buildings, convert
sound stages, install
recording equipment and

1952

'"

connec¬

Valley Oil Co., Reno, Nev.

filed

zu

dividend

shares

-December 1,

■r"

Consolidated Gas, Electric Light &
Power Co. of Baltimore
'

fractional

working capital. Office — 945 South
Angeles 15, Calif. Underwriter—None.

...Common

Seacrest

of 3,500
(no par).
Price — At market
share). Proceeds—To common stock¬

to

stock

(Offering to>stockholders—underwritten by
Harris, Hall & Co., Inc.)

stock

tion

Finance Co., Los
Angeles, Calif.
(letter of notification) 14,000 shares of common
(par $1). Price—$20.75 per share. Proceeds—For

Nov. 14

1

Co., Inc

17

Seaboard

Union Bag & Paper Corp
Common
(Offering to stockholders—underwritten by
Morgan^Stanley & Co.)
Western Light & Telephone

stock

common

ir Panhandle Eastern Pipe Line Co.
*Nov. 21
(letter of notification) a maximum
common

Common

(Offering to stockholders—no underwriting)

—

of

1952

Cleveland Electric
Illuminating Co

(par $4)
Price—At the market. Proceeds—To J. Paul
Getty, Presi•dent, Underwriter
None, sales to be handled by
brokers on the New York Stock
Exchange. ;

-shares

(George) Sons, Inc., Fremont, Neb.
(letter of notification) 989 shares of 6% cumu¬
lative preferred stock. Price—At
par ($100 per share).
Proceeds—For working capital. Office—108 East 6th
St.,
Fremont, Neb. Underwriter—None, but
Ellis, Holyoke &
Co., Lincoln, Neb., will act as broker.

&

than

more

43

10

stock (ppr $1).

common

State

Street

Investment Corp.
shares of capital

(par $50) on a par for
(6.000 preferred shares are
outstanding). Un¬
derwriter—Warren W. York &
Co., Inc., Allentown, Pa.
Reeves Soundcraft
Corp., N. Y.

Safeway Stores, Inc.
Sept. 12 filed 1,900 shares of 4% cumulative preferred
stcok (par $100) and 18,000 shares of common stock
(par
$5) to be issued to James A. Dick Investment Co. (for¬
merly The James A. Dick Co.) in exchange for inven¬
tories, fixtures, operating supplies, good will and other

stock (no par)
■being offered for subscription by stockholders of record!
Nov. 5, 1952, at rate of one new share for each
10 shares'
held; rights to expire on Dec. 20. Price—At net asset

Oct.

assets of Dick.

It is

warrants

will

a

tive convertible preferred stock

basis

par

3

(letter of notification) 10,245 shares of common
stock (par five cents).
Price—At market (about
$2.62%
per share).
Proceeds—To Bernard
Goodwin, the. selling
stockholder.

Underwriter—Gearhart

&

York.

Otis, Inc., New

+ Rolock, inc., Fairfield, Conn.
17 (letter of
notification) 1,750 shares of common
stock (par $1) to be offered for
subscription by stock¬

Nov.

holders

To

on

expand

Nov.

25.

facilities.

Fairfield, Conn.

Price—$14
Office

—

per

1350

Underwriter—None.




share.

Kings

Proceeds—

Highway,

sell

all

time to time

or
on

anticipated that the Dick Company

substantial

part of these shares from

the New York Stock

Exchange.

Under¬

writer—None.

Sapphire Petroleums Ltd., Toronto, Canada
28 filed 50,000 shares of common stock
(par $1—
Canadian). Price—To be supplied by amendment. Pro¬
will
New

offer
York

Ken

Kelman,

the shares
Curb

24

value

the

from

Exchange

market. Underwriter—None.

selling

time
or

in

to

stockholder,

time

the

either

on

who
the

over-the-counter

filed

in

180,556

effect
are

investment.

when

properly

executed

received from stockholders.

subscription

Proceeds—For

Underwriter—None.

Steak 'n Shake of

Oct. 23

Oct.

ceeds—To

Oct.

stock

Missouri, Inc., St. Louis, Mo.
(letter of notification) 48,000 shares of common
cents) being offered for subscription by

(par 25

stockholders of record Oct. 27 at rate of
for

each

9*%

shares

held

(with

an

one

new

share

oversubscription

privilege); rights to expire
share.
4294

on Nov. 29. Price—$2.25 per
Proceeds—For expansion of subsidiary. Office—

Chippewa St., St. Louis, Mo. Underwriter—None.

Continued

on

page

44

44

The Commercial and Financial Chronicle

(2056)

"ontinued

from

Video

43

page

Oct.

it Stonewall Insurance Co., Mobile, Ala.
17 (letter of notification) 3,750 shares of common
stock
(par $20).
Price—$40 per share. Proceeds—To
enlarge business. Office—154 St. Louis St., Mobile, Ala.

Products Corp., Red Bank, N. J.
(letter of notification) 75,000 shares of common

3

stock (par 50 cents).

Price—$2.50 per share.
Proceeds
working capital.
Office—42 West Street, Red
Bank, N. J. Underwriter—None.

Nov.

—For

Underwriter—None.

Nov.

a

Stout Oil

Co., Denver, Colo.

(letter of notification) 1,000,000 shares of common stock (par five cents). Price—Nine cents per share
.Proceeds—To acquire oil and gas leases. Office—1729
Oct. 23

Stout St., Denver,

&

Brothers
underwriter.

Colo. Underwriter—Dansker

Co., Inc., New York, has withdrawn as

it Stout Oil Co., Denver, Colo.
Nov. 18 (letter of notification) 1,182,497 shares of com¬
mon stock (par five cents).
Price—Nine cents per share.
Proceeds—To pay notes and for equipment for drilling.
Office—1729 Stout St., Denver, Colo. Underwriter—E. I.
Shelley Co., Denver, Colo.

Chicago, III.

Streeter-Amet Co.,

Corp., Tulsa, Okla.
(letter of notification) 3,000 shares of common
(par $3). Price—At market. Proceeds—To J. A.

7

Proceeds—To in¬

Price—$100 per share.

La Fortune and Mrs. Gertrude La Fortune.

equity capital to take care of increased business
and increased costs.
Office—4101 Ravenswood Avenue,

Underwriter

—Harris, Upham & Co., New York.

;

it Washington National Insurance Co., Evanston, III.
Employees'
Savings and Profit Sharing Pension Fund for a twoyear period involving an estimated $750,000 of employ¬
ees' contributions during such period.
Nov. 24 filed participations in the company's

Chicago 13, 111.
Sweet Grass

Underwriter—None.
Oils, Ltd., Toronto, Canada

Proceeds

.Exchange at time of offering.

—

For working

capital. Underwriter—F. W. MacDonald & Co., Inc., New
York.

Offering—Probaby

time in October.

some

Texas General Production Co.
*■

') June

filed

4

(par 50

2,500,000 shares of common stock

To

buy property for oil prospecting.
Office—Houston,
Underwriter—To be named by amendment. -Of¬

Tex.

fering—Tentatively postponed.' Statement
<7

drawn.

be with¬

may

15, 1964, and 580,000 shares of
cents) to be offered in units of
share of stock.

Price—To

stock

common
one

Co., Inc., Houston, Tex.
Nov. 12 (letter of notification) 100,000 shares of common
stock (par 10

cents). Price—50 cents

per

share. Proceeds

—For

working capital. Office—1 Main St., Houston, Tex.
Underwriter—Scott, Khoury & Co., Inc., New York.
Torhio Oil Corp.,

I

Ltd., Toronto, Canada
Aug. 21 filed 300,000 shares of common stock (par $1) to
be offered first to stockholders and then to the general
public. Price — 60 cents per share. Proceeds—For ex¬
ploration of oil and gas properties, and to drill a test
well. Underwriter—None, but offering to public will be
bandied through brokers.

-

Trad Television

Corp., Asbury Park, N. J.

Nov. 10 (letter of notification) 130,000 shares of common
stock (par one cent). Price—At market (about 27 cents

(par 50

Proceeds—From sale of units and

tional shares of

stock and private sale of

common

it West Coast Pipe Line Co., Dallas, Tex.
Nov. 20 filed

1,125,000 shares of

common

stock

Price—To be supplied by amendment.

(par 50
Proceeds

—Together with other funds, to be used to build pipe¬
line.
Underwriters—White, Weld & Co. and Union Se¬
curities Corp., both of New York.

it West Flagler Amusement Co., Inc., Miami, Fla.
20 filed 170,000 shares of common stock (par 50
cents). Price—$10 per share. Proceeds—To nine selling

Nov.

Business—Amusement park.

>

Is

owner

of

West

Flagler Kennel Club. Underwriter—Floyd D. Cerf
Co., Miami, Fla., and Chicago, 111.

Jr.

Western Light & Telephone Co., Inc.

(11/28)
65,168 shares of common stock (par $10)
to be offered for subscription by common stockholders
Nov.

filed

7

new

one

share for each five shares held about

Nov. 26; rights to

expire Dec. 9. Price—To be supplied
by amendment. Proceeds—To repay bank loans and for
new
construction.
Underwriter
Harris, Hall & Co.
(Inc.), Chicago, 111.
—

it Winn & Lovett Grocery Co.
of notification) 14,192 shares of common
stock (par $1) to be offered for subscription by employ¬
ees
under Employees' Stock Purchase Plan.
Price—At
95% of market value (approximately $21.13% per share).

Nov. 18 (letter

Wisdom

Magazine, Inc., Beverly Hills, Calif.
cumulative preferred
stock (par $100) and 6,600 shares of common stock (par
$10) to be offered in units of one share of preferred and
Sept. 17 filed 6,600 shares of 5%

one

share of

ceeds—To

stock. Price—$110

common

per

unit. Pro¬

share). Proceeds—To Victor Trad, President. Office
—1001 First Ave., Asbury Park, N. J. Underwriter—

new national picture
derwriter—None. An earlier registration

None.

July 14, 1952, covering a like offering of preferred and
common shares was withdrawn Aug. 1,
1952.

•

Trans

Worid

filed

31

Airlines,

Inc.
of

381,916 shares

being offered for subscription by
•of

Nov.

record

19

at

rate

of

stock

common

common

one

(par $5)

stockholders,

share

new

for

each

shares

held; rights to expire on Dec. 5. Price—
$16 per share. Proceeds—For working capital. Under¬
writer—None. Hughes Tool Co. (which holds 75% of
seven

Prospective Offerings
The

be

sold

of

the

on

common

New

York

Stock Exchange at market (about $10.62%
per share).
Proceeds—For working capital.
Underwriter—None, but

Hayden, Stone & Co., New York, will act
Union

Bag & Paper Corp., New York

as

broker.

(11/28)

Nov. 7 filed 253,008 shares of capital stock
(par
foe offered for subscription by stockholders of
Nov.

28

at

rate

of

one

new

share

for

each

six

$20) to
record
shares

foeld.

Rights will expire on Dec. 15. Price—To be sup¬
plied by amendment.
Proceeds — For working capital
and expansion program.
Underwriters—Morgan Stanley
i&

Co., New York.

®

United

Oct.

15

Gas

filed

Corp.,

Shreveport, La.

525,036 shares

of common

(par $10)

being offered for subscription by Electric Bond & Share
Co. to its stockholders
Gas

stock

held

on

$22.50

for each

10

on

the basis of

shares

of

one

Bond

share of United

and

Share

stock

Nov.

per

10; with rights to expire Dec. 3. Price—•
share. Proceeds—To Electric Bond & Share

Co., which presently owns 3,165,781 shares (27.01%) of
outstanding United Gas stock. Underwriter—None.

A United Petroleum & Mining Corp., Bismarck, N. D.
17 (letter of notification)
150,000 shares of class A
voting stock and 150,00 shares of 4% class B non-voting

crease

First

acted
ers

cost of the

in the estimated

as

Boston

Corp.,

and

expansion program.

A. E. Ames

&

Ltd.,

Montreal, Canada
stock.

Price—

ranging from 50,000 to
200,000 shares at prices ranging from 15 cents to $1 per
Estimated public offering prices
range from 35
cents to $1.50 per share. Proceeds—For
mining opera¬
tions. Underwriter—Jack
Rogers, of Montreal, Canada,
who is the "optionee" of the stock to be
taken down.
share.




bidding. Probable bidder—(1) For
bonds, Halsey, Stuart & Co. Inc.; Coffin & Burr, Inc. and
The First Boston Corp. (jointly); Blyth & Co., Inc. and
Kidder, Peabody & Co. (jointly); Merrill Lynch, Pierce,

■

]
I

Fenner & Beane and

White, Weld & Co. (jointly); Har- j
Ripley & Co., Inc.; Salomon Bros. & Hutzler. j
(2) For stock, Blyth & Co., Inc. and Kidder, Peabody &

riman

Co.

(jointly); Coffin & Burr, Inc. and The First Boston I
Corp. (jointly); Harriman Ripley & Co., Inc.
...

it Charter Oil Co., Ltd.

(12/17-18)
Nov. 18, it was reported that company plans to offer and
sell 900,000 additional shares of common stock (no par).
Price—To be named later (around $1.70 per share).
Proceeds—For expansion program.
Underwriters—Lehman Brothers and Bear, Stearns & Co. for about
800,000
shares; balance to be offered in Canada. Registration—
Tentatively expected this week. '
■
*

;

!

j

!

.

it Chicago, Rock Island & Pacific RR.
Bids will be received by the company up to noon (CST) I
Dec. 9 at its office, Room 1136, La Salle Street Station, j

on

Chicago 5, I 11., for the purchase from it of $4,440,000
equipment trust certificates, series O, to be dated Jan. 1,
1953 and to mature in 24 equal semi-annual instalments
from July 1, 1953 to and including Jan. 1, 1965.- Probable
bidders:

Halsey,

Stuart

Co.

&

Inc.;

Salomon

Bros.

Hutzler.

Columbia Gas System, Inc., N. Y.
was announced company plans to issue and sell
common stock and additional debentures early in the

Oct. 10 it

Spring of 1953.

Proceeds—To repay bank loans and for

construction program.

Company has sought SEC author¬
ity to borrow from banks an aggregate of $25,000,000.
Underwriters—To be determined by competitive bidding.
Probable bidders: For stock. Merrill Lynch. Pierce. Fen¬
ner & Beane,
White, Weld & Co. and R. W. Pressprich
& Co. (jointly); Morgan Stanley & Co. For debentures,
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co. '

Connecticut Light & Power Co.
was announced that it is presently

March 1 it

in Oct. 1951.

American Trust Co.,
Nov.

12

San Francisco, Calif.
offered 246,088 additional shares of

company

stock

common

(par

$20)

record Nov. 7 at rate of

to

one

common

stockholders

of

share for each three shares

Arkansas

Fuel

Arkansas

Oct. 3 it

was

Oil

Corp.

Natural

Gas

(to be successor to

Corp.)

announced that subject to approval of reor¬

ganization plan of Arkansas Natural Gas Corp. by U. S.
Court of Delaware, the new company, to be
known as Arkansas Fuel Oil Corp., proposes to issue
and sell $23,000,000

of sinking fund debentures due 1972.

Proceeds—To

retire $21,877,760 of 6% preferred stock
(par $10), at $10.60 per share, with preferred stockhold¬
ers, other than Cities Service Co., to be offered the de¬
bentures in exchange, plus a cash adjustment.
Under¬

writers—To
Probable

be

bidders:

determined

by competitive bidding.
Halsey, Stuart & Co. Inc.; The First

Boston Corp. and Lazard Freres & Co.

Arkansas

Culver
22

Hartford, Conn.

Corp., Chicago, III.

it

was

(jointly); Smith,

announced
on

or

Louisiana

Gas

Co.

,

stock

common

on

a

to
of

share-for-

Duke

Power

;

Co.

j

Nov. 10 the FPC authorized company to split up common
shares on the three-for-one basis. The company said?

this stock split will be advantageous in raising the addi- ?
tional new capital which will be necessary for the con- f
tinuation of its postwar construction program. Costings

than $250,000,000.

more

East Tennessee

Nov.

13

the

FPC

Natural

Co.

Gas

authorized

the

to construct |

company

about 100 miles of pipe line the estimated cost of

which,
$5,784,606, is expected to be financed through the issu¬
ance of $4,500,000 of first
mortgage bonds (which may
be
placed privately)
and $1,300,000
of bank loans.
Traditional
Eastern

Sept. 3 it

Underwriter—White, Weld & Co., New York.
Utilities

Associates

announced that amended plant of reor-|
ganization of this company and subsidiaries calls for is¬
suance

by

was

of $7,000,000 debentures and

a suffi¬
approximately
$2,000,000. plan further provides that Blackstone Valley
Gas & Electric Co., Brockton Edison Co., and Fall River
Electric Light Co. issue mortgage bonds. Proceeds—TOj

cient

company

amount

of

common

stock

to

raise

bank loans. Underwriters—For EUA debentures
be determined by competitive bidding. Probable

repay

may

Lehman

Arkansas Power & Light Co.
Aug. 7 C. Hamilton Moses, President, announced thai
the company expects to borrow additional money next
Spring to finance its 1953 construction program, which,
it is estimated, will involve $29,500,000.
'
V

that company proposes
about Jan. 26, 1953, a total

basis; rights to expire Feb. 9.
Price—At par ($2
per share).
Proceeds—For investment. Office—105 West
Madison Street, Chicago, 111. Underwriter—None.

bidders:

it was reported company may issue and sell
$35,000,000 of first mortgage bonds. Underwriters—May
be determined by competitive bidding.
Probable bid¬
ders: Halsey, Stuart & Co. Inc.; The First Boston Corp.
and Lazard Freres & Co. (jointly); Union Securities
Corp.; Smith, Barney & Co.; Equitable Securities Corp.
Proceeds—To repay bank loans nnd for new construction.

j

(1/26)

share

held.

Rights to expire Dec. 11. Price—$50 per share.
Proceeds—To increase capital and surplus. Underwriter
—Blyth & Co., Inc., and associates.

estimated

that approximately $11,000,000 of additional capital will:
be required during the latter half of 1952. Underwrite*

Co., Ltd.,

dealer-managers in stock offering to stockhold¬

Dec. 6, 1951

common

mined by competitive

23,640 additional shares of

expected that additional financing will
be undertaken in 1953 to meet the major part of the in¬
15 directors

stock.

Oct. 22 filed 1,050,000 shares of
To be taken down in 10 blocks

standing short-term notes. Underwriters—To be deter- j

offer to stockholders

Barney & Co.

Victoria Copper Zinc Mines

was announced company soon after March 1,
1953, intends to issue and sell $6,000,000 of first and
general mortgage bonds and sufficient common stock to
yield approximately $5,000,000 to refund the then out¬

Nov.

Aluminium Ltd.

Nov.

Price—$1 per share.
Proceeds—To purchase oil
and gas leases.
Office—222 Main Street, Bismarck, N. D.
Underwriter—John G. Kinnard & Co.,
Minneapolis, Minn.

Power Co.

Sept. 2 it

District
stock

Corp.

,

Central Maine

•

Twentieth Century-Fox Film Corp.
Nov. 10 (letter of notification) 201 shares

Price—To

Electric

proceeds to be

—Putnam & Co.,

Oct.

$1).

statement filed

Hughes & Co., Denver, Colo.

Ar Trojan Mining & Milling Co., Inc., Lovelock, Nev.
Nov. 19 (letter of notification) 100,000 shares of capital
stock.
Price—$1 per share. Proceeds—For mining and
milling operations. Underwriter—None.

(par

magazine. Un¬

—

outstanding Trans World stock) will purchase any un¬
shares, so that the net proceeds will be at
least $5,000,000.

-stock

publish

it Wyoming National Oil Co., Inc., Denver, Colo.
Nov. 17 (letter of notification) 500,000 shares of common
stock (par five cents). Price—25 cents per share. Pro¬
ceeds
For oil and gas leases. Underwriter — R. L.

subscribed

'r

&

Underwriter—None.

per

Oct.

Gas

used for new construction.: Latest
financing was done privately in March, 1951,:
through Kidder, Peabody & Co., New York.
)

$50 debenture and

be

supplied by amend¬
1,125,000 addi¬
$55,000,000 first mortgage bonds, to be used to build a 1,030mile crude oil pipeline.
Underwriters—White, Weld &
Co. and Union Securities Corp., both of New York.
one

at rate of

w-

Texas Western Oil

Hudson

Central

Oct. 20 filed with New York P. S. Commission for per¬
mission to issue and sell $6,000,000 first mortgage bonds,
bond

stockholders.

cents). Price—To be supplied by amendment. Proceeds—

announced

company intends to sell early
approximately $10,000,000 of additional new se¬
curities, viz: $8,000,000 of first mortgage bonds and
about $2,000,000 of common or preferred stock. Proceeds
—For new construction and repayment of bank loans.
Underwriters—May be determined by competitive bid¬
ding. Probable bidders: (1) For bonds only—Halsey,
Stuart & Co. Inc.; Salomon Bros. & Hutzler. (2) For
bonds
and
stocks:
Merrill Lynch, - Pierce,
Fenner &
Beane and Dean Witter & Co. (jointly); Kidder, Peabody & Co.; Blyth & Co., Inc.
.♦
"

the

cents).

-July 29 filed 375,000 shares of common stock (no par).
Price—To be related to quotation on the Toronto Stock

Power Co.

Electric

was

In 1953

it West Coast Pipe Line Co., Dallas, Tex.

crease

f

California

Oct. 7 it

Nov. 20 filed $29,000,000 12-year 6% debentures due Dec.

ment.

Aug. 27 (letter of notification) 2,367 shares of common
stock (par $50) to be offered for subscription by common
stockholders at rate of one new share for each four
shares held.

Warren Petroleum

stock

•

.

..

_

Thursday, November 27,1952

...

Halsey, Stuart & Co. Inc. (for bonds only);
Brothers; Estabrook & Co. and Stone & Webster

Securities Corp. (jointly); Glore, Forgan & Co. and
riman Ripley & Co., Inc. (jointly).

Har-I

j
j:

it Equitable Gas Co.
Nov. 20 it

announced company may offer early nexU
$10,000,000 of preferred stock. Proceeds—To repay"
$8,000,000 of bank loans and for construction program.
was

year

Underwriters—May be determined by competitive bid¬
ding. Probable bidders: Blyth & Co., Inc.; Kidder, Pea¬
body & Co.; White, Weld & Co.; The First Boston Corp.;
Merrill Lynch, Pierce, Fenner & Beane.
Meeting —
Stockholders will vote
of

Jan.

20

$20,000,000 preferred stock.

authorizing
£ \
V y

on
.

.

.

an

issuej

fVJu5l'KftH.«Kli«Atf»Af1 iS»uW«WM

Volume 176

Number 5172

...

The Commercial and Financial Chronicle

June 11 it

was

reported company plans to raise an ad-

-

ditional $400,000 of

equity capital. An issue of $200,000
just recently placed privately at
$7.50 per share.
Underwriter — Gearhart, Kinnard &
Otis, Inc., New York.
of

•

capital stock

Garrett

was

Freightlines,

Oct. 17 it

(12/15)

Inc.

announced company has applied to ICC

was

for authority to issue and sell $1,100,000 6% convertible
debentures due 1967. Price—At par. Proceeds—To retire

outstanding debentures and preferred stock and for new

equipment and working capital. Underwriter—Allen &
Co., New York; Peters, Writer & Christenson, Denver,

Colo^ and Edward D. Jones & Co., St. Louis, Mo.
General Public Utilities

Corp.

by the sale of securities.

the

GPU expects to

sale of

•combination
well

into

obtain the funds from bank loans,

debentures, the sale of common stock or a
of these.
If present conditions continue

next

GPU would expect to offer addi¬

year,

tional shares to stockholders rather than resort to bor¬

rowing.

Sept. 16
construct

860-mile pipeline extending from

southern
point in northeastern Kentucky. This
project would cost about $127,887,000. Transportation of
gas is expected to commence by Nov. 1, 1954.
an

Louisiana

to

a

Indiana & Michigan Electric Co.

Nov. 6 it

plans to issue and sell
preferred stock. Proceeds—
To repay bank loans and for new construction. Under¬
writers—May be determined by competitive bidding.
Probable bidders: (1) for bonds—Halsey, Stuart & Co.

in 1953

reported

was

company

bonds and/or

some

Inc.; Kuhn, Loeb & Co.; The First Boston Corp.; Union
Corp.; Harriman Ripley & Co., Inc. (2) for
preferred—Lehman Brothers; The First Boston Corp.;
Smith, Barney & Co.

Securities

Iowa-Illinois
Nov. 3 it

Gas

&

reported

was

Electric

Co.

loans

and

for

(par $100).

new

Underwriters—To

be

(•determined

by competitive bidding. Probable bidders:
Nor bonds, Halsey, Stuart & Co. Inc.; Harriman, Ripley
Ids Co.Inc., Union Securities Corp. and White, Weld &

|"Co.

(jointly); Equitable Securities Corp.; Glore, Forgan
Harris, Hall & Co. (Inc.); Lehman Brothers;
I-Blyth & Co., Inc.; The First Boston Corp.; Smith, Barney
•& Co.
For preferred, Blyth & Co., Inc.; Merrill Lynch,
I Pierce, Fenner & Beane; Glore, Forgan & Co.; Lehman
•&

I

Co.;

"Brothers; Salomon Bros. & Hutzler and Union Securities
'Corp. (jointly); Kidder, Peabody & Co.; Harriman, Rip¬
ley & Co. Inc. Bids— Tentatively scheduled to be re¬

ceived at 11
-•

a.m.

(CST) on Jan. 27.

Kansas

City Power & Light Co. (1/20)
Nov. 19, H. B. Munsell, President, announced company
•plans to issue and sell $12,000,000 of first mortgage

| bonds.

Proceeds—To repay bank
•construction. Underwriters—To be

loans

and

determined

for
by

new
com¬

petitive bidding.
Probable bidders: Halsey, Stuart &
i<Co. Inc.; Glore, Forgan & Co.; Blyth & Co., Inc. and
Lazard
Freres
&
Co.
(jointly);
The
First
Boston
Corp.; White, Weld & Co. and Shields & Co. (jointly);
[Smith, Barney & Co.; Kuhn, Loeb & Co., Salomon Bros.
|;& Hutzler and Union Securities Corp. (jointly); Equit¬
able
Securities
Corp.; Lehman Brothers and Bear,
on

Jan. 20.

I'Oct. 1 it

was

reported company may issue and sell $10,-

of

securities, probably

bonds.

^Proceeds—For new construction. In August of last year,
m issue of $8,000,000
3'%% first mortgage bonds due

|71976

was placed privately through Lehman
[errill Lynch, Pierce, Fenner & Beane.

IjNov. 13 it

Brothers and

& Co.

Orleans

reported

company may

Lehman Brothers.

I

Mansfield

I Oct.
of

|G.

a

Tire

&

Rubber

Public

Service

Inc.

shares

of

stock
outstanding)^
Underwriters—May be

common

construction.

new

by competitive bidding. Probable bidden:
Brothers; The First Boston Corp.; Smith, Bar¬
& Co. and Harriman Ripley & Co., Inc.

Lehman
ney

Pacific

by competitive bidding.
Probable bidden:
Halsey, Stuart & Co. Inc.; Lehman Brothers; Kidder,
Peabody & Co. and Stone & Webster Securities Corp.
(jointly); Equitable Securities Corp.; Union Securities
Corp. Bids—Originally scheduled to be received on

Sept. 13 it

construction. Underwriters—To

new

Dec.

have

15

been

postponed until around the
the first quarter of 1953.

end

of

* New Orleans Terminal Co.

York

July 1, 1953. New bonds will be guaranteed
as
to principal, interest and sinking
fund instalments by Southern Railway Co.
Probable
bidders: Halsey, Stuart & Co. Inc.; Morgan Stanley &
Co.; Kuhn, Loeb & Co. ••
on

New York Central
Nov.

it

14

RR.

Pacific Northwest Pipeline Corp.
company filed a second substitute application
with the FPC proposing to construct a
1,384-mile trans¬
mission line extending from the San Juan Basin in
New

Aug. 29

company

•

Pan-American Sulphur Co.,

Dallas, Tex.
23, J. R. Patten, President, said that it is planned
an
issue of over $3,000,000 of common stock
(probably around 500,000 shares to be offered to stock- ^ *

Oct.
to

Ohio,

to

up

it

dated

on

reported company may be planning to issue
$10,000,000 of first mortgage bonds. Previous
financing was done privately through The First
Boston Corp. and Drexel & Co. If
competitive, probable
bidders may include:
Halsey, Stuart & Co. Inc.; The First
Boston Corp.; Equitable Securities
Corp.; White, Weld &
Co.; Smith, Barney & Co.

and

by the company at Cleveland,
(EST) on Dec. 3 for the purchase

noon

For

Pennsylvania Power & Light Co.

(12/3)

received

of $2,430,000

a

—

both of New York.

Oct. 3 it

York, Chicago & St. Louis RR.

Bids will be

from

float

l-for-2V2 basis. Price—About $7 per share. ;
construction program. Underwriters—.
Kuhn, Loeb & Co. and Carl M. Loeb, Rhoades & Co-

Stuart & Co. Inc.; Salomon Bros. & Hutzler.
New

Colorado to market areas in the Pacific
Estimated overall capital cost of the
project

$179,000,000. Financing is expected to consist of first
mortgage pipe line bonds and preferred and common
stocks, and is expected to be completed by April, 195&
Underwriters—White, Weld & Co. and Kidder, Peabody
& Co., both of New
York, and Dominion Securities Com*
Ltd., Toronto, Canada.

Proceeds

expects to receive
bids on Dec. 17 for the purchase from it of $11,625,000
equipment trust certificates. Probable bidders: Halsey,

•

and

holders

(12/17)

announced

was

publicly

Alto, Calif.

is

Y., for the purchase from it of $8,000,000
first mortgage bonds to be dated Nov. 1, 1952, and to
mature Nov.
1, 1977.
Proceeds, together with other
funds, will be used to repay $11,423,000 bonds which

reported corporation plans to sell

issue of prior preference stock to finance
expansion at
Kaar Engineering Corp. of Palo

Northwest.

N.

5,

Associates, Inc.
was

an

Mexico

(12/4)

Bids will be received up to noon (EST) on Dec. 4 at the
office of the company, Room 2018, 70 Pine Street, New

equipment trust certificates to be

Jan.

1, 1953 and to mature annually from Oct.
1, 1953 to Oct. 1, 1967, inclusive. Probable bidders:
Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.
New
Oct.

York, New Haven & Hartford RR.

31

it

announced

was

was

sell

bond

sell $14,000,000 of bonds.

company

Oct. z* it

(1/7)

plans to issue and

Proceeds—Together, with other

Co.

1 it was

reported company plans issuance and sale
convertible preferred stock issue. Underwriter—A.

was

subsidiaries

announced

will

issue

that

company

and each of its

mortgage bonds

or .other
debt
securities. Proceeds—To finance' construction
programs.

first mortgage

Underwriters—To be determined by competitive bidders.
Probable bidders: Halsey, Stuart & Co.
Inc.; The First

—To

Boston

funds, to refund $14,482,000 Harlem River & Port Chester
be

4% bonds due May 1, 1954. Underwriter
determined by competitive bidding. Probable

bidders:

Halsey, Stuart & Co. Inc.; Kidder, Peabody &

Co.;

Kuhn, Loeb & Co.; Morgan Stanley & Co.; The
Corp.; Smith, Barney & Co.; W. C. Langley
Bids—Expected to be received on or about Jan. 7.

First Boston

& Co.

Northern Indiana

Lynch, Pierce, Fenner & Beane.
Northern

Natural

Gas

Co., Omaha, Neb.

Sept. 17 company sought FPC authority to construct
pipeline facilities to cost an estimated $69,826,000. This
would include about 442 miles of main pipeline addi¬

tions; installation of a total of 73,600 h.p. in new and
existing compressor stations; and numerous branch line
additions. Probable bidders for debentures or bonds;
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; The First
mortgage pipeline bonds, and preferred and common
Boston Corp. and Kidder, Peabody & Co. (jointly). Com¬
mon

stock

•

Ohio

financing will probably be done via rights.

Edison

Co.

(1/13-1/7)

sought SEC authority to issue and sell,
early in 1953, of 150,000 additional shares of preferred
stock (par $100) and 479,846 additional shares of com¬
mon stock (par $12), the latter issue to be first offered
for subscription by common stockholders of record Jan. 7
on a l-for-10 basis at a price to be determined by the
Proceeds—To finance construction program.
To
be
determined
by
competitive

company.

issue and
approximately $5,000,000 of bonds in May or June,
1953, and in the latter part of 1953 to issue sufficient

sell

shares to

bank

repay

writers—To

loans
be

raise

and

about $4,000,000. Proceeds—To
for new construction. Under¬

determined

by
competitive
bidding.
bonds, Halsey, Stuart & Co. Inc.;
The First Boston Corp. and Coffin &
Burr, Inc. (jointly);
Kidder, Peabody & Co.; White, Weld & Co.
For stock,
Kidder, Peabody & Co. and Blyth & Co., Inc. (jointly);
Harriman Ripley & Co. Inc.
Probable bidders:

For

Rockland Light & Power Co.
Nov. 12, F. L.

Lovett, President, announced company ex¬
about $24,000,000 in the next two years
through sale of bonds, and preferred and common stock,
viz: $5,500,000 of first
mortgage bonds and $5,500,000
pects to

raise

fvt

prefererd stock in 1953 and $6,000,000 bonds,
$6,000,000
preferred stock, and $1,000,000 common stock in 1954.
Proceeds—For expansion program.
bonds and preferred stock

Underwriters

—

For

may be determined by com¬
petitive bidding. Probable bidders: (1) For bonds—Hal¬
sey, Stuart & Co. Inc.; First Boston Corp. and Salomon
Bros. & Hutzler
(jointly); Stone & Webster Securities
Corp.; Lehman Brothers, Bear, Stearns & Co. and A. C.

Allyn & Co., Inc. (jointly); Merrill Lynch,
Pierce, Fen¬
& Beane; Estabrook & Co.
(2) For preferred—Stone

ner

&

Webster Securities
Corp.; Lehman Brothers; W. C.
Langley & Co.; Estabrook & Co. and Kidder, Peabody &
Co. (jointly). Common stock will
probably be offered
for subscription
by stockholders.

—

bidders: (1) For perferred stock:
Co.; Lehman Brothers and Bear,
Stearns & Co. (jointly); W. C. Langley & Co.; Glore,
Forgan & Co. and White, Weld & Co. (jointly); The First
Boston Corp.
(2) For common stock: Merrill Lynch,
Pierce, Fenner & Beane and Kidder, Peabody & Co.
(jointly); Lehman Brothers and Bear, Stearns & Co.
(jointly); Morgan Stanley & Co.; The First Boston Corp.
Bids
For preferred, expected Jan. 13; for common,
Morgan

Corp.; Glore, Forgan & Co.; Kuhn, Loeb & Co.

Public Service Co. of New Hampshire
Nov. 3 it was announced
company plans to

common

Public Service Co.

Sept. 18 it was reported company may issue and sell
shortly after the close of this year some additional pre¬
ferred and common stock. Underwriters—May be Cen¬
tral Republic Co. (Inc.), Blyth & Co., Inc. and Merrill

Probable

Stanley

&

San Diego Gas & Electric Co.
July 1, L. M. Klauber announced that of the more
$18,000,000 required for capital improvements in

than

1952,

approximately $4,000,000 will become available from de¬
preciation reserves and earned surplus, while the re¬
mainder must be secured
through the sale of securities.
Underwriter—Blyth & Co., Inc. handled previous pre¬
ferred stock
financing.
^

—

Becker & Co. Inc., Chicago, 111.

Jan. 7.

:

.

[Sept. 23

company was authorized by FPC to construct
191 miles of natural gas pipeline and to acquire an exist¬

Ohio Power Co.

office

(1/20/53)

Oct. 28 it

was

reported company plans to issue and sell

$22,000,000 of first mortgage bonds and 100,000 shares of
preferred stock (par $100). Proceeds — To repay bank

|Corp.;

determined

Narragansett Electric Co.
Oct. 7 it

was

reported company plans issuance and sale

$10,000,000 first mortgage bonds, series D. Pro¬
ceeds — To repay bank loans and for new construction.
Underwriters—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; Kuhn, Loeb
& Co. and Glore, Forgan & Co. (jointly); Salomon Bros.
of about

& Hutzler;

Kidder, Peabody & Co. and Stone & Web¬




of

Broad

ing 38-mile line from Arkansas Power & Light Co. at an
I aggregate estimated cost of $4,524,200. Stock financing in
July, 1951, was underwritten by Equitable Securities

T. J. Raney & Sons; and Womeldorff & Linasey.

Seaboard Air
Bids will

MidSouth Gas Co.

,

(2,411,945

be de¬

ceeds—For

bidding.

do some financing
lin 1953 in the form of debentures or long-term bank
loans.
Previous financing was done privately through
was

company plans to issue and
stock at about a one-for-ten

common

determined
New

July 24 company announced plans to issue and sell $6,000,000 of first mortgage bonds due Dec. 1, 1982. Pro¬

Underwriters

Macy (R. H.)

announced

was

Proceeds—For

Nov. 20 company

Laclede Gas Co.

|«000,000 to $12,000,000

it

additional

basis

.

J'Stearns & Co. (jointly); Harriman Ripley & Co.. Inc.
|!Bids—Tentatively scheduled to be received

13

sell

Peoples Gas Light & Coke Co.

Proceeds—To repay bank

construction.

Oklahoma Gas & Electric Co.
Nov.

may

(1/27/53)

| -'$6,000,000 first mortgage bonds and 60,000 shares of
preferred stock

bank

in January offer
additional capital stock for subscription by its stock¬
holders.
Underwriter—Merrill, Turben & Co., Cleve¬
land, Ohio.
/

plans issue and sale of

company

reported

was

unconditionally

Co., Houston, Tex.

applied to the FPC for authority to

company

it

17

mature

Gulf Interstate Gas

Brothers; The First Boston Corp.; Union Securi¬
Corp. and Salomon Bros. & Hutzler (jointly). Bids—
Tentatively expected to be received on Jan. 20 at 11 a.m.
(EST). Registration—Scheduled for Dec. 18.
ties

i National City Bank of Cleveland
Nov.

45

Lehman

Subsidiaries expect

to sell around $49,000,000 of bonds, debentures and pre¬
ferred stocks and GPU will furnish about $16,000,000 to
them.

Securities Corp. (jointly); Lehman Brothers and
Goldman, Sachs & Co. (jointly); Union Securities Corp.;
The First Boston Corp.; White, Weld & Co. Offering—
Expected late this year or early in 1953.

termined

Nov. 15, A. F. Tegen, President, announced that its doimestic subsidiaries may spend around $80,000,000 for
mew construction in 1953.
Of this total, $15,000,000 will
fee provided internally leaving about $65,000,000 to be
financed

(2057)

ster

'European American Airlines, Inc.
*'

a u!

loans and for

new

construction.

Underwriters

—

To be

bidding. Probable bidders:
(1) For bonds, Halsey, Stuart & Co., Inc.; The First
Boston Corp.; Union Securities Corp. and Salomon Bros.
by

competitive

& Hutzler

(jointly); Kuhn, Loeb & Co., Harriman Ripley
&
Co., Inc. and Stone & Webster Securities Corp.
(jointly); Blyth & Co. Inc.; Glore Forgan & Co. (2)
For preferred stock, Blyth & Co., Inc.; Dillon, Read &
Co.,

Inc.;

Harriman

Ripley

Webster Securities Corp.

&

Co.,

Inc.

and

Stone

&

(jointly); Glore, Forgan & Co.;

be

Line

received

RR.
up

to

(12/2)
noon

(EST)

on

Dec. 2 at

Willkie, Owen, Farr, Gallagher & Walton, 15

St., New York 5, N. Y., for the purchase from
the company of
$5,700,000 equipment trust certificates,
series M, to be dated Dec.
1, 1952 and to mature in 30
equal semi-annual installments.
sey,

Sinclair Oil
Oct.

Probable bidders: Hal¬

Stuart & Co. Inc.; Salomon Bros. & Hutzler.

28

it

was

Corp.
announced

company plans to issue and
$101,758,900 of new convertible subcidinated debentures, which are first to be offered for
sub¬
scription to comon stockholders at rate of $10U of deben
sell

a

total

of

tures for each 12 shares of stock-held.
Price—To be dt

Continued

on

~

page 4(L

46

The Commercial and Financial Chronicle... Thursday, November
27,1952

(2058)

Continued from page
terrained at

and for expansion

$40,000,000
Offering-

program.

New

Pierce, Fenner & Beane, both of

Lynch,

Natural

Southern
3

estimated

facilities
it

had

to

cost

the

that

expects to

company

•

may

was

announced company and New

Orleans <v

$15,000,000 of
joint 25-year mortgage bonds due Nov. 1, 1977. Proceeds
—For refunding.
Underwriters—To be determined by
Northeastern

plan to issue and sell

RR.

Co. Inc.;

Room

received

(EST)

noon

on

it

3

Hyde,

B.

was

Inc.,

bonds

Union

National

Planters

it

stockholders

investors

was

16.

capital

of

Price—$32

and

willing to

are

for outlets for

in their quest

shares

100,000

share.

per

surplus.

successful

paid

group

of

capital

Proceeds—To

101.533 for a 314% in¬
rate.
The
second bid,

considerable

the

investor

interest

a

was

mere

at

moment.

well

bentures

along

of¬
de¬
the

an

new

toward

marketing stage. And this one,
judging by Street interest, has
of
potential
makes

years,

old

saying that "it's an ill
wind that blows no good" appears
to be working out at the moment
The

in

the

things

market just

that

now

not really good.

are

issue

the

But

at

reoffering

pronounced and no relief in sight
for the remaining few weeks of

bankers have been un¬
usually keen in bidding for such
business as has been reaching the

DIVIDEND

pany

done

their buying with

of

having

such material for

It may
draw

reach

the end

will

for

be

new

increasing

might

the
hold

spell.

be, however, that

nearer

bankers

a

to

of

as we

Up

offering

week's

willing

to

issues

because

of

danger

that

they

of

to

chases through

year-end
as

carry

such

pur¬

or

has today declared

those who distribute

1952

Here
was

Yet

buyers

show interest in

a

began

to

day or so and

completely sold out

while not

is

it

record
on

a

The

divi¬

Twenty-

share on its

par

stockholders of

debentures

appeared

to

pose

an




Allen

of

25

$.25

share

per

shares

January

on

5%

of

1953

PAUL

ence

in

curities,

experi¬

over-the-counter

including

Box. B1120.

Financial

years'

se¬

EARNINGS

has

25

of

held

and

thirty-seven

stockholders

record

of

,

November 21,

J.

KINNJ3Y,

1952

:

Dividend Notice

A

Stock

ARUNDEL)

Pre¬

to
at

/CORPOSMBIC^

the

BMTIN0M

MARYLAND

RAIBOURN,

19,

in ell

phases of television

of

Directors

of

ers

of

1952)

25,

corporation's

the

recordon

books at the close of business Decem¬
ber

1952.

15,

MARSHALL G. NORRIS,

Secretary.

CORPORATION

12 months ended

1952.

30,

covers

a

Such

12 months'

Securities and Exchange Commis¬

Copies
will

of such earnings

be

mailed

on

state¬

request

to

other interested parties.

visions of Section II (a)

of the Securi¬

Lily-Tulip Cup Corporation
122 East '42nd Street

New York 17, New

Park
Dated:
November 27,

1952

'AMERICAN'
The

following dividends have

been declared
Stock'

of

on

MACHINE AND

the Common

Allied

Chemical

METALS, INC.

&

Dye Corporation:
Quarterly dividend No.127 of

:i 6th Dividend

,

Sixty Cents ($.60)

A

per

share.

regular

dividend

Special

dividend

Cents

($.60)

Both

Dividends

December

per

of

Sixty

share.
are

payable

12, 1952, to stock¬

cents
on

in

quarterly

of

November
addition,

25,
an

1952

TWENTY-FIVE cents a share.
Both

are

payable

on

York

of record December

November 25, 1952.

Secretary

and

EXTRA, of

of business December 3, 1952.

KING,

declared',

was

ber 29,

W.C.

cash-

TWENTY-FIVB

share

a

holders of record at the close

ties Act of 1933.

41

the

has
this day
declared thirty
cents
per share as
a quarterly divi¬
dend, and fifty cents per share as an
extra dividend, on
the no par value
stock of the corporation, issued and
outstanding,
payable
on
and after
December 24, 1952, to the stockhold¬
Corporation

(November

1952

mm

Board

The

Arundel

generally available to its
security holders a consolidated earn¬
ings statement of the Company and its
subsidiaries for the

,k

i

Secretary-Treasurer"

a

its

STATEMENT

CUP

,

2, L

December

made

Municipals.

Chronicle,

American

of

meeting

a

one-half
cents ($.37V2)
per share on the Corpmon Stock, payable December 12, 1952,

dividend

Security Holders:

to

LILY-TULIP

Commercial and

Place, New York 7.

at

Inc.,

1952, declared a quarterly

B.

Treasurer

securities in accordance with the pro¬

of

Directors

of

Lines,

December 15, 1952.

Broadway, New York 4, N. Y.

Such earn¬
ings statement is made generally avail¬
able to the holders of the Company's

Twenty

Board

November 21,

Cumu¬

Preferred

1,

close of business

November

to

i1 ab 1 e
reorganization of

AMERICAN EXPORT LINES, INC.
The

quarterly

regular

a

Convertible

Secretary and Treasurer

ment

CASHIER

be

NOTICES

ferred Stockholders of record

because

early test of how high in price

of

outstanding

security holders of the Company and

firm.

phone & Telegraph Co.'s 27-year

declared

dividend

value of

and Bookkeeper a v a

Bidding for this week's offering
of
$35,000,000 of Pacific Tele¬

to

Export

of Directors

Board

has

the close of business

at

sion.

SITUATION WANTED

from

Approaching the Line

expected

C. EARLE MORAN

the

new

Stock

Morit Laboratories, Inc. this day

Du

December 5, 1952.

September

moving.

reported

COMMON

somewhere from

Allen B. Du Mont Laboratories, Inc.

payable

Notice

again the initial reception

slow.

is

of

specifying a LILY-TULIP CUP CORPORATION
reoffer¬ Earnings Statement for the Twelve
ing price of 100% for a yield of Months Ended September 30, 1952.

so.

that time forward.

fund

to cut down,

3V8% coupon and fixing a

it's got to be something really spe¬
cial to interest such buyers

it. is

Meanwhile

lative

statement

securities know from experience,

sinking

the over-all life of the debentures.

$50 per share, payable Decem¬

able to report

until January.

in another week

the

thus tending

ber 23, 1952, to

Long

Lighting

just under 3.09%.

65th

Dividend

C.

earnings
period
Pillsbury Mills
beginning after the effective date (July
Insurance companies, still the
Another
of
those
industrial 5, 1951) of the Company's Registration
major outlet for such investment
Statement for 75,000 shares of Com¬
issues which
come
along from
mon
Stock, without nominal' or par
material,
will
start
arranging
time to time via the negotiated value, which was filed under the Se¬
their
financial
affairs
for
the
route is reported to be arousing curities. Act of 1933, as amended, with

have

offers.

it

Double A rating, it is

a

understood
liberal

NOTICES

di¬

;

Directors

capital stock of the

of

Traditional

1352.

bonds, with bankers

the year

less

Board

dend of One Dollar and

oversubscrip¬
way. But because of
tion and closing of the books.
the paucity of new offerings these
Again this week, Gulf States
undertakings seemingly work out Utilities Co. received a price of
over a period.
Bankers, of course, 100.17 for $10,000,000 of 30-year
expectation

Carrying

for

to

Anaconda Copper Mining Com¬

this issue took hold and sponsors
were

under

which

versification

DIVIDEND

that score, not to

opportunity

178

November 26,

The

Co.'s $20,000,000
market.
of 30-year bonds priced at 101 to
Almost without exception, be¬
yield 3.32% found buyers reluc¬
cause of the lean yields afforded,
tant at the start. But ultimately
such issues have been slow in get¬

NO.

five Cents ($1.25) per

Last

the

AnacondA

hesitant.

Cleaning

Others

Island

it attractive on

DIVIDEND

a

buyers appeared a bit

the year,

And,

increase

.

for

priced

was

construction.

new

financing prior to maturity (June 1, 1953) of
$6,300,"000 bank borrowings. Probable bidders for bonds:
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Union
Securities Corp.; Kidder, Peabody &
Co.; Shields & Co.;
Merrill Lynch, Pierce, Fenner &
Beane; Harris, Hall
& Co. (Inc.); Carl M. Loeb, Rhoades & Co.; Salomon

thinking

were

dividend

manent

'

price of 102.176
With the dearth of new offer¬
to yield an indicated 3.13%. For
ings of this type becoming more
the moment at least, prospective

the

and

stock

3.15% to 3.20%.

DIVIDEND NOTICE

that all bid¬

pretty much
the same. Report has it that sev¬
eral big buyers had expressed in¬
in the new issue market. At least terest in a 3.18% yield basis and
you would have some difficulty in might have come in readily even
convincing corporate issuers who on a 3.15% level.
ders

a

—

priced to yield

winning tender.
This would indicate

(carrying

ic Wisconsin Public Service Corp.
Nov. 14 company announced that it will undertake
per¬

mention

$1.23 per
caught the
fancy
$1,000 bond lower and the lowest
buyers.
of
four bids received,
101.37589
The maturity, 20
was
but $1.57 a bond below the
101.40999,

Co.

Bros. & Hutzler.

the fering of $15,000,000 of

company

terest

Gas

convertible preferred stock

as

Underwriter—Equitable Securities

Pillsbury Mills Inc., has

funds.

The

Natural

of about

Corp., Nashville, Tenn.

their

have

Western

Sept. 2 stockholders approved the creation of an author*
ized issue of 500,800 shares of preferred stock (par $30);
pf which the company plans to offer about 170,000 snares

(par $10) on a one-for-five basis; rights to expire about
Dec.

Corp. is

Union Securities Corp., New

go

ting

in 30 equal semi-annual -installments from
July T, 1953 to Jan. 1, 1968, inclusive. Probable bidders:
Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.
-

Bank, Memphis, Tenn.

announced company plans issuance

31
to

reported sale of this company's common

ultimate

certificates, series D, to be dated Jan. 1, 1953 and

mature

Underwriter—White, Weld & Co., New York.

sale

York.

are

to

Bear, Stearns & Co. and Carl M. Loeb,
(jointly); W. C. Langley & Co. Offering
probably early in 1953; and of stock, late

Oct.

—

trust

1952.

•

Development Co.

Underwriter

planned.

determined by competitive

retire bank loans and for

Co.,

in

Y., up to

(at least 260,000 shares) by Sinclair Oil

stock

'

44

5%) for subscription by common stockholders
on
a
l-for-20 basis.
Proceeds
To redeem 2,053 out¬
standing shares of 5% preferred stock (par $100), to

Dec. 11.

Southwestern
Oct.

John

by

'

.

—Of

Co. Bids
Vice-President,

70 Pine Street, New York 5, N.

2018,

(12/10)

Wall St., New York 5, N. Y., up to noon (EST) on Dee;
10 for the purchase, from it of $6,360,000
equipment

Co.;

&

Kuhn, Loeb & Co.; Morgan Stanley &

be

—To

RR.

Rhoades & Co.

Probable bidders: Halsey, Stuart &

competitive bidding.

Wabash

Bids will be received by the company at its office,

Fenner

(12/11)

Southern Ry.

Nov.- 2 it

•

mortgage bonds and 500,000 shares of

White, Weld & Co. and Merrill Lynch, Pierce,
& Beane (jointly); Lehman Brothers. The com¬
mon stock offering may be underwritten
by The First
Boston Corp. In 1950, the following group bid for com¬
mon stock issue: Merrill Lynch, Pierce, Fenner & Beane;
Blyth & Co., Inc.; Smith, Barney & Co. and Collin, Nor¬
ton & Co. (jointly); Lehman Brothers, Harriman Ripley
&

The

for at least

bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Equitable Securities Corp. and Salomon Bros. & Hutzler (jointly); Carl M. Loeb, Rhoades & Co.; Kidder, Pea*
body & Co.; The First Boston Corp. and Glore, Forgan
& Co. (jointly); Union Securities Corp.; Smith, Barney

be via stockholders.

carrier."

for privately

reported company plans issue and sale of

first

derwriters—For bonds, to be

Inc.; Kuhn, Loeb & Co.; The First Boston Corp., Blyth
& Co. Inc. and Kidder, Peabody & Co. (jointly). Any

to

initial financing has been, ar¬
with no public offering expected
two-years. E. Holley Poe and Paul Ryan; of
70 Pine St., New York, N. Y., are the principal officer*
of the corporation.
Underwriters—Probably Dillon, Read
& Co. Inc. and Glore, Forgan & Co., both of New York.'

ranged

stock. Proceeds—For construction program. Un*

common

bonds

financing

"common

Edison Co.

was

$7,500,000

indenture, and to provide for other permanent financing
by the sale of additional first mortgage bonds or other
securities in such amounts as may be appropriate at the
time. Probable bidders for bonds: Halsey, Stuart & Co.

stock

it

3

formed

was

products pipeline from the Texas Gulf Coast to St. Louis,
Chicago and other midwest markets to operate as a

be necessary;

Toledo
Oct.

during the first six months of
1953 in the amount then permissible under its mortgage
additional

sell

been

.

to construct pipeline
$32,518,500.
On Sept. 15

company

announced

been

Co.

Gas

authorized

FPC

stock financing

this previously was done pri¬
vately. Underwriter—Dillon, Read & Co. Inc., New York.
also

may

York.

Nov.

common

Pipe Line Co. (DeL)
announced, that this company had
build, own and operate a- petroleum

Sept. 25, 1950 it

(with offer to be made
first to stockholders) and use the proceeds toward it»
construction program which, it is estimated, will involve
approximately $23,000,000 for the year ended Aug. 31,
1953.
Additional bond and preferred stock financing
tional

Expected some time in January. Registration—Expected
after Dec. 18. Underwriters—Smith, Barney & Co. and
Merrill

United States

..

Aug. 4 it was reported that company may do some addlr

later date. Proceeds—To retire

a

loans

of bank

Southwestern Public Service Co.

45

Decem¬

1952 to share owners

10.

1952:

Hi T. MeMeekin, Treasurer

I

Volume 176

Number 5172

The Commercial and Financial Chronicle

...

(2059)

DIVIDEND
—

9
A

NOTICES

^

—„

GEOKGE- W.

.

Rockefeller Plaza,

DIVIDEND

:

flELME

THE

New

York,

able

January 2, 1953, to stockholders of record
the.-Close of business December 9, 1952.
A -quarterly dividend of 40 cents
per share and
an' extra dividend of 20 cents
per share on the
Common
Stock
have
been
declared,
payable
January 2, 1953, to stockholders of record at
at

the

close

of

business
J.

Dated:

November

December 9,

P.

26,

GALLEY

At

Y.

N.

quarterly dividend of 43% cents per share
Preferred Stock has been declared, pay¬

the

on

DIVIDEND

held

share

per

Company
10,
1952

ber

Board

Mountain
the

on

of

Directors

Company
dividend
of

a

Capital

Stock

KENNECOTT

CORPORATION

November

and

Johns-Manville

m

Pa.,

quarterly

been

payable

pany,
of

ers

28.

December

record

at

the

1952,

15,

close

of

to

12.

1952,

holders

to

Dollars

declared

Copper Corporation; payable

on

20, 1952, to stockholders
on

business

15,

December

BONNYMAN,

Secretary

The

112

clared

has

de¬

50*

of

the

per

Company of the
share,

value

par

of

$LL50

payable December 29, 1952, to
holders of record at the close of business
December 5, 1952.

will

Treasurer.

J. H. MICHAELI.

November 18, 1952

PACIFIC

DIVIDEND
.A

QUARTERLY

Cents

($.75)

NO.

140

DIVIDEND

share

on

record

at

per

of

of

Monday,
books

this

December 1,

will

be

not

Treasurer

COMPANY

of

Seventy-five

20.

Common Stock of
this Company has been declared payable at the
Treasurer's Office, No. 165 Broadway, New York
6.
N.
Y., on Monday, December 22, 1952, to
tne

o'clock

three

P.

CENTURY

M.,

FOX

The stock trans¬
the payment

1952.

for

closed

dividend.
J.

New

•

ROGER

stockhold¬

York,

N.

A. SIMPSON, Treasurer.
November 20, 1952.

Y„

HACKNEY, Treasurer

TWENTIETH CENTURY-

November

B.

ASHBY,

Secretary.

Board

has

0

*»CO*PORAr£»

„

of

declared
of

(/

cf

FOX FILM CORPORATION

193rd

New York 3,N. Y.

Preferred

business

Stock

of

on

The

of .record

December

to stockholders of

ord

of

10,

the

1952.

close

1November 25,

of

KARR,

business

of

CORPORATION

Secretary.

20$

the

Farmingdale, New York

Corporation

-

rec-

.»

At

of
the Board
of Directors
of
Fuel and Iron Corporation, held
25, 1952, the regular dividend in
of'thlrty-seven and one-half cents
per
share v/as declared on its common stock,
together
with
the regular
dividend
in
the
Colorado

November

on

the

IIiIyard, Treasurer

meeting

a

The

December

amount

1952

share

31,

of

of the corporation,

195)

of

sixty-two and
series A $50

the

on

stock

to

stcckhokL'*5;
December

business

on

cents

at

5,

the

the close of business

(15(0
to

stockholders of

record

December 9,

share

a

convertible

DIVIDEND

No.

business

on

1952.
A.

HENDERSON.
Treasurer.

second

on

January 2,

the

at

close

UTILITIES

De¬

COMPANY

12, 1952,

John H. Gage,
'
*

„

<►

business

of

'

Treasurer

November 24, 1952

►

J

DIVIDEND

The

per

of

Board

declared

ary

NOTICE

Directors

today

dividend of 47 cents

a

share

of the

C.I.T. FINANCIAL CORPORATION

171

to stockholders
of

on

Treasurer

'

per

declared

'

William G. Holman

'%■

close

on

close of business December 9,1952.

T3o?dmti

the

$.25

been

preferred

the

at

at

1953 to stockholders of record

cember

Pcr share has also been de¬
payable December 23, 1952

clared

1952

record

of

Common Stock

has

DONALD

share

a

$1.00

and

$4.00

An extra dividend of Fifteen Cents

1952.

dividend

Corporation

of

on

stock,

common

clared, payable

Decem¬

on

this

cash

outstanding

preferred stock have been de¬

ber 9, 1952.

per

par
value preferred
both payable December
cf r<-e~rd at the close

D.'C. McGREW, Secretary,

,

,

one-half

stock,

23, 1952 to stockholders of record

amount

share

a

the $3,50 cumulative

Liberty
Products Corporation declared the
regular quarterly dividend of Fif¬
teen Cents (15(0
per share on its
common stock,
payable December

The Colorado Fuel & Iron

on

the

on

payable December 24,

PRODUCTS

of

close

1952.

The Board of Directors of

Checks will be mailed.

Harry L.

the

at

5,

quarterly

share

87V2*

American

January 2, 1953,

A

LIBERTY

per

November 25, 1952

Tohacco Company, payable in cash

at

Co.

Dividend

A quarterly dividend of 1^% ($1.50
a
share) lias been declared upon the
Preferred

Crane

$.25

K-. L.

.

of

a

$.50

dividend

Shareholders

111 Fifth Avenue

Directors

regular quarterly divi¬
share, and a special
per share on the out¬
standing Common Shares of the Com¬
pany, payable on December 20,
1952, to

dend
+

,

Directors

dividend

outstanding Capital Stock of

per

pay¬

CRANE CO.

..

of

end

year

share on the

Com¬

The

.

a

Board

1952
W.

.

LIGHTING COMPANY, INC.
DIVIDEND NO. 222

iTTj/

1952

1952,
hooks

1,
Transfer

1952.

L.

SOUTHERN

on

record

of

December 1. 1952.

of

P.

fer

ROBERT C, SULLIVAN,

26,
NO.'

closed.

stockholders

December 1, 1952.

payable

November

DIVIDEND

per

December

be

share

a

today by Kenne-

dividend of

the Common Stock, both

on

December

the

on

the

business

of

$1.25

share

per

declared

Stock

In addition thereto, a year-end

of

Two

of record at the close of business

dividend

a

of75c per shareon the Common Stock, and,

1952

dividend

Fifty C:nts (4.50)
has

Capital

25,

Nov.

of

STOCK

21, 1952

Twenty-five Cents ($2.25)

December

; "

RACE STREET

The Board of Directors declared

A

cott

DIVIDEND

distribution

has been

Corporation

HOOUCTI

2,

cash

cents

close

not

Mexico,

New

AND

Co.

Company has declared a dividend
share on the Common Stock
Company to stockholders of record at

the

the

East42dStreetMewYorkl7,N.Y.

Treasurer

COMPANY

50

able

161

Secretary

Incorporated
1513

THE SAFETY CAR HEATING

Pacific

&

above

of

of

declared payable Decem¬

was

The

COPPER

of

A

Phila.

NOTICES

Mountain

Rocky

COMMON

to
shareholders
of
record
close of business November 28, 1952.
CHARLES E. HEWITT,

at the

Louis,

Raton,

Coal

November--19, '1952,

$1.00
the

of. the

Gauley

1952.

METER

DIVIDEND
St.

■JCWWa-MAMVtltt

AMERICAN

NOTICES

MOUNTAIN COAL COMPANY

meeting

a

The

of

1952.

McCAULEY,

NOTICES

—

COMPANY

47

the Common Stock

on

Company, payable Janu¬

2, 1953 to stockholders of

recoscLot-the -close-of business"
The final dividend for the
year 1952
of one .dollar ($1.00) per share has-

been- declared

of

record

at

the

close

of

business

An

L.

NOETZEL

:

7(pve>nbc-t'25,-1952

%x$$rer■<

q,

at

the close

A

۩3tPOffi JtTIOH

1952,. The transfer books

H.

G.

CONCRETE

record at

1,

will

Y,.

Heavy Construction

close.

not

55fh Consecutive Dividend

on

the Common

The Board of Directors of Rome

Cable

Stock

to

stockholders

the close of business December

Corporation

consecutive
30

has

Dividend

declared

Tennessee

No.

55

for

mon

10,

to

holders

of business

HAUTAU, Treasurer

The

1952,

*£ H H t SSI U C

day declared an extra dividend
of 50per share on the Com¬
mon
Stock, payable on Decem¬
ber 18, 1952, to stockholders of
record

December

on

5,

cents

per share on the Com¬
Capital Stock of the Corpo¬
ration, payable December 24, 1952,

of

bfc mailed.

November 25,

of
on

record

No.

the

close

December 3,

Directors

Dividend

at

also

26

bringing

distribution
M.

M.

1952..

declared

total

61

W.

V.

December 17, 1952, to stockholder

for 30 cents per

An extra dividend of
thirlfi
(30^) cents per share also has bet
declared, payable December 1'

share

SET

poration, payable January 2, 1953,
to

holders of

of business

record

on

at

the

close

December 3,

;

the close of busint

at

December 3, 1952.

1952

on the 4% Cumulative Con¬
vertible Preferred Stock of the Cor¬

fifty (50(f) cents
share has been declared, payahl

of record

President

McMENIMEN,

24,

Broadway, New York 6, N. Y.

A dividend of

per

UPSON, Chairman of Board

November

'.

1952,,

dividend
13.50 per share.
1952

to

CORPORATION

, AT KM

November 18, 1952.
•

1952,

1952, to stockholders of record'„

John H. Dyett, Secretary
Rome, N. Y„ November 25, 1952

the close of business December
1952.

FAHLBUSCH, President

-November 25, 1952.

1952.

The Board of Directors has this

1953,

FRED W.

November 21,

Soil Investigations*Foundations

1952. The transfer books will not close. Checks
will

CO.

December

Common Stock

on

PILE

140 Cedar Street, New York 6, N.

FINANCIAL CORPORATION,

payable January

Tlje Directors of the Byrndun Corporation at
its
meeting held on November 25, 1952 de.clared a dividend of $1.50 per share on the
Participating Preferred Stock, a dividend of
$2.50 per share on the Class "A" Participat¬
ing Stock, and a dividend of $3.50 per sliary
.on
the Second Preferred Stock; also a divi¬
dend of Thirty Cents (3040 per share on the
.Class "A"
Participating Stock, Class "A"
Common Stock and Common Stock; no divi"dend on
fractional
shares, all payable on
December 18, 1952 to stockholders of record
at 3:00 P.M. December 8, 1952.

share in

quarterly dividend of $1.1per share in

of C. I. T.

'

Secretary

thefCommon Stock

of business

cash has been declared

THS BTSNDOT "

on

per

Checks will be mailed.

Dividend

:

cents

FINANCIAL CORPORATION,
December 24, 1952, to stockholders

record

1952.
JOHN HUME

50

cash has been declared

10,

•

of

of C. I. T.

of

""

December 5,

*

Cummon Stack

dividend

extra

payable

December 5, 1952.
E.

ExtrcnDividend
on

the

capital stock
of The Borden Company, payable
.December 20, 1952, to stockholders
on

-

.-

JOHN G. GREENBURGH

.

Treasurer.

Southern

f

AMILY

i

«
i-

Iff. Materials Handling Equipment

Company
Locks
Builders' Hardware

DIVIDENDS

!

ORIGINAL

m

%

A
;::s

California

Edison

dividend of fifteen cents

(15c)

per

share

on

180 Madison

THE Boardthe Directors has this day
of following dividends:
declared

Coimnon Stock of this Cor¬
was

declared

CONSECUTIVE

regular quarterly dividend for
the current quarter of $\A2'/2 per
share, payable January 1, 1953, to

.

De¬

Checks will.

ness

at

December 5, 1952,

Quarterly dividends were
declared
by
the
Board

-

CORPORATION

of

Directors

as

follows:

The

regular quarterly dividend for
quarter of $1,75 per share,
payable January 1, 1953, to holders
the

r

•

'TREASURER

Philadelphia, Pa.
November 21.1952

I

of record

at

close

the

of business




$.35
value

per

share

common

the

on

Company's $1

par

stock.

COMMON

STOCK

share, payable December
22, 1952, to holders of record at the
close of business December 5, 1952,
R. O.

GILBFRT

preference stock, Series B.
to

stockholders

ness,

are

of

payable January 2, 1953
record

at

November 25,.7952.

close

of

busi¬

December 9, 1952.
William

Secretary

Board

257th and 258th
Dividend

of Directors has

Declarer

50

cents

27

cents

share
inal Preferred Stock;
per

on

On

Orig¬

extra

of

share on Cumu¬
lative Preferred Stock, 4.32%
per

The above dividends

1952,

-

HALE,Treasurer

The
clared

share>

dividend

payable

No.
on

holders of record

Jr.

Vice-President and Secretary

November 21, 1952

was

the

at

Dec. 22,

Dec.

258,

of

of

close

of

5, 1952.

Directors

Jan. 2,

on

on

stockholders

to

business

1952. Checks will be

mailed

ber 31, 1952.

share,

per

or,

No. 257,

Directors out of pasl earn¬

pay¬

from the Company's
office in Los Angeles, Decem¬

1952,

by the Board oi

ings, payable
are

also

$0.50

de¬
per

1953, to stock¬

Dec. 5,

1952.
F. DUNNING

>

Executive

r

November 25, 1952

$0.50

declared

ber

5,

25,

dividend,

record

p.C.
B. Paul.

Nov.

December 31, 1952, to
stockholders of record Decem¬

$.56H per share on the Company's 4lAVo
cumulative preference stock, series A; $.62 54
per share on the Company's 5% cumulative
The dividends

NO. 23

able

CUMULATIVE PREFERENTI ST0CL

December 5, 1952.

50 cents per

Americas N-t ciqar

TALE & T0WNE

STOCK

Series,

COMMON STOCK

current

%

I?

PHILLIES

PREFERRED

of the
following quarterly dividends:

ON COMMON STOCK

the close of busi¬

7% SECOND PREFERRED STOCK

The

DIVIDEND

'

he mailed.

STOCK

authorized the payment

QUARTERLY

The

holders of record

cember 1, 1952.

CUMULATIVE

DIVIDEND

90th

4Va% PREFERRED STOCK, SERIES A

pay¬

able December 16, 1952, to

shareholders of record

I NANCE

NO. 174

4.32% SERIES

&

poration

Avenue, New York 16, N. Y.

the

PREFERRED

DIVIDEND

CORPORATION OF AMERICA

THE YALE

&

Vice-President

and

Secretary

TOWNE MFG. CO.

The Commercial and Financial Chronicle... Thursday, November

4t

27,195$

(2060)

in to reorganize their de¬

come

BUSINESS BUZZ

partments

one

by

All they

one.

have to do is to shift functions.

i

/

Washington
from the Nation'*

ft

4r>

vf-As

xJL I

Capital

'1 ft'! f*

■A '■$ft

V
A.

W

In

shifting

WPSNORTElliANDCd

V,.- ■■■'■■

f

<
.

they

can

called

are

"job

descriptions" by the Civil Serv¬

.

ice Commission. They can there¬

Manufacturers Of, *;

Morale

functions

what

re-write

■ft if

A

Behind-the-Scene Interpretation*

m

•V-v ?

•

•

•

by abolish existing jobs, leaving

Bailing Office Signs

the Democratic appointees with

work./ Civil

no

Service

them

guarantees

job

a

only

within

their

it

whether

and

will

be

belond

mum

of $275

These

billion,

are among

the important things

which will

fee

in

determined

part

large

(This column

anonymously.
the

that

was

Another fruit of this labor was

experts upon Capitol Hill.

that

the

While

of the

some

newly-ar¬

rived

Congressional leaders
have been sounding off with a
fjromise

hint

or

quick

of

tax

to save

spending.

ways

Congress

80th

the,

of

those

matters.

fiscal

on

Bookshelf

of surplus since the great
depression of the 1930's set in.
Another fruit was tax reduction.

swers—118

final
explanatory
notes and solutions—Joseph Scha-

/ieeply

sewed up beyond rethe
$107
billion
of

that

almost

which

at its

the

this

has

Pentagon

disposal this

year.

the
special technical staff of the
House Appropriations Commit¬
is

It

tee

at

that

point

the fore.

to

comes

bring

to

needed

on

fiscal matters that it will be

(D., Mo.), the Chairman of
the Appropirations Committee,
called
J.
Edgar Hoover, Di¬

sharply reduced appropriations
voted next year, to keep govern¬
ment spending in fiscal '54 even
a shade below $80 billions and
in fiscal '55 to $70 billion, with¬

to

that

the

wanted

he

best

man

with

a

the

entire- FBI

the

on

staff

FBI

Committee

the

to

send

technical

in¬

and

vestigative background fitting
feim to investigate government
expenditures.
v

the

was

recommended

man

the

and

Hoover

by

em¬

man

ployed by Chairman Cannon.
Mr.

in

ing reductions
that

Cannon

Mr.

enthusiasm

lost

his

of

services

Mr. Lee. This investigator might
liave

the

in

people

made

Taber (R., N. Y.)

November,

and

Taber

Mr.

John

Rep.

the Chairman

of the Appropriations

Commit¬

picked

Lee

in

obligating and there¬

group

with its outside

which

the

not

ex¬

in

cases

obligations to spend

carefully sewed

so

up.

Key Method: Use Outsiders
Uee headed
than six

more

or

seven

-

investi¬

gators, most of them, like Lee,
former FBI

ing

experi¬

investigative

and

These

ence.

with account¬

men

were

men

never

around the "front office" of the

Appropirations
Committee
in
the Capitol. As a matter of fact,
they had offices uptown.
So

little

that

group

about

it

been

has

legends
around
the

lounges.

members

of

of

many

prevail

cocktail

known

Even

some

Congress will

tell

that there were "15 FBI in¬
vestigators" and outside Con¬
gress the number has been put
as high as 25.

you

Actually,
the work

the

was

bulk

great

done

by

to be so again.
billion of funds
available for the Pentagon in
the
present fiscal year, only
$15.8 billion had been spent up
may prove

the

Nov.

to

Vice-President

largest
United

An

of

of

outside

one

States
the

of

in

the

the

engaged

to

expenditures

in

was

field. Business and industry
men
of solid achievement and

one

leading private accountants,
were engaged on a consultative
per diem basis to do most of
the work. The slender pay these

or

got

from

the

allowances




20

able

possible

economy

on

performance

even

though

the

Congress may be
impose an overall dol¬

such

limit,

a

of

a

belief in highly in¬

that

the

de¬

is so big that in
details the Defense De¬
partment simply doesn't know

many

what it is doing. It will be the

not

possible to bring in

propriation
some
$5 to

project is

an

ap¬

rescission
bill
of
$6 billion. Such a

serious possibility.
Where the services claim they
have
"obligated" an expendi¬
ture, they will have to be pre¬
pared to show the contract or
a

professors,

made

his

will

if the Defense Department knew

despite the civil service, if the

gineers,
1121
Fifteenth
Street,.
N. W., Washington 5, D. C. —
paper—$2.00 per copy up to 25

in

it

that

advance

be

would

live

to

compelled

spending limit 6f

within

so

mined to

a

many spe¬

There

billions, it could accom¬
modate its planning and pro¬

the

connection

this

In

drive.
;
...
people

'

Service

the

that

have little

military
tional

or

Their

affairs.

lic
.

tradir

(1) to administer

the

affairs

and

of

the

method

FDR's

to

promising
by

(2) to produce the supplies

Department,

through
to

Mr.

Taber

literally

recapture

appropriations

and

authoriza¬

tions already made. This alone
should make it possible to let
the

profits tax (latest es¬
timates reduce the yield from
this

excess

tax

to

$2

billion from $3

billion) lapse June 30, and the

agen¬

staffed with genuine
servants.

of

Board

practically

For

took

pub¬

instance,

Economic

the

the

over

for¬

eign trade analysis work of the
Bureau of Foreign" and Domestic

^Commerce and this correspon¬
dent

remembers when

em¬

ployees

of
the
latter,
with
nothing to do,: literally begged
BEW

for the Services.

to

be

given

a

organization

and

arrang¬

Wilson

as

therefore

ideally

an

industrialist

is

expected to he suited

for

the

job.

If

he

at¬

tempts, however, to simplify in
any way

the variety of weapons

This

of

quantities

on

request.

'

Let

Freedom

the

conflict

Ring—A

history
freedom

between

and Soviet totalitarianism—Office
of

Public

Affairs, Department of

State, paper—Government Print¬
ing Office, Washington 25, D. C.—
50c.
Turn

on

defining
power

tional

the Light

of

some

companies

—

Brochure

electric

the

problems—Na¬

Association

Electric

of

Companies (Mr. P. L. Smith), 1203
Eighteenth Street, N. W., Wash¬
ington 6, D. C.
Working Wives and Mothers

method

is

less

promising

because it involves

leaving exist¬
ing agencies alone whilst setting
up

'

to 25 copies); prices

chance to

help.
So

'

Na¬

for NSPE.

copy

per

—

Warfare

ones,

new

adding

to

total

—

Stella B. Applebaum—Public Af¬
fairs Committee, Inc., 22 East 38th

Street,

New

York

16,

N.

Y.

—

paper—25c.

expenses.

The

for the

other
new

method

is

Secretaries

simply
as

WE WILL TRADE:

they

Crosse & Blackwell A & B

Campbell (A. S.) Pfd.
Gear

J

V

<

tofr.i

FOREIGN

SECURITIES

and

$5 billion to $6 billion of

was

Federal
and do

new

duplicate

to

for larger
■

followed

create

cies

realize is
Secretaries,

($1.00

copies

doing

the work of the old-line

nothing to do with

job is

least

method

agencies

E.

will be of invaluable aid to the

few

the

of

the

simply

Wilson to be Defense Secretary

What

money.

two ways of

Roosevelt.

ap¬

Charles

GM's

of

deter¬

is

Engineering Manpower

members up

One
is

Wilson Appointment Will Help

pointment

save
are

of

this.

that schedule.

curement to

a

Administration

new

cific

~

be

How to Improve the Utilization

tional Society of Professional En¬

roll is far from

&;/.

staff

from

effort

Arbor, Mich.—cloth—$6.00.
.

the pay¬

FIRM TRADING MARKETS

first

of Experience in 50 American
Corporations —John W. Riegel —
University of Michigan Press, Ann

difficult task,

Have Other Plans

the

Executive Development: A Sur¬
vey

and

other evidence of obligation.

So

sity Press, 2960 Broadway, New
York 27, N. Y.—paper—$1.25.

thou¬
"econ¬

these tax eaters from

job of the Secretary of Defense.

if it is

counting in the U. S. A.—Organi¬
for
European
Economic
Cooperation — Columbia Univer¬

zation

possible the
would go
along. Furthermore, it is said,
Department

ing supply is the present prime

see

that

fact

ingly riveted on the Federal
payrolls under the protection of
civil
service,
the retiring
of

is

it

penditures,

Defense

industrial executives engaged by

spending closely and

The Use and Practice of Cost Ac¬

tired newspaper
have got themselves seem¬

men

dent committed to reduced ex¬

Mr. Taber to

down defense

the

of

omists,"

billion, was tentatively approved
by the House, Defense screamed
bloody murder. With a Presi¬

job of outside accountants and
run

Cost Account and Productivity:

to

sands

Defense, Army, Navy, and Air,

quarters

—cloth.

Can Blast Democrats Loose

$45

it thinks it is.
There is

backing,

be relied upon to

can

Despite

economy

fense program

have
for the

spending limit upon the De¬

publicly that it will meet
its schedules, that it is failing
to spend the money as fast as

formed

to

in "military matters."

years,

to

When

executive

corporations

down

This

1.

suggests that

experts of great experience and
business stature.

$107

and

of seldom

a group

It

Of

Pentagon is protesting privately

Cannon could lay him down.

men

fixed

nicely

perts found numerous

up

Mr. Lee, as it were, before Mr.

run

was

In

by protecting its spendings. The

were

Republican Con¬

a

This

gress.

this

the

3.

but for the fortuitous fact

1946 elected

tee

the

from

disappeared

ascene

that

1948

the way of

soon

1947
government also
Jan.

after

Corpo¬

Payments Division, International
Monetary Fund, Washington, D. C.

procure¬

have

override him with thei
appeal to the President that the
Defense
Secretary is dabbling
try

House, the first co¬

operation

Short of the miracle, the Lee

thought it

the

for

White

the

plans, how¬
cooperation of

the

fense Department.

so

for

With

ever.

House

military

other

are

will

he

White

of June 30.

as

faster

and

ment,

to kill this higher

even

There

made to the "free world."

achiev¬
expenditures

possibilities

jwany

rate

lar

shortly

Neifeld

Volume 4 (1950-1951)—Balance of

efficient,

of

sake

cheaper,

tax to end Dec. 31,1953, or

come

the

for

of the personal in¬

bite"

possibly

ready let, projects already
started, or commitments already

to be the next
best
thing. Mr. Lee and his
staff will be back on the job

R.

Management

Balance of Payments Yearbook,,

"11%

in

and

find

to

began

Lee

in contracts al¬

rescissions

out

group may prove

Robert E. Lee, an FBI agent,

'Mr.

impossible, regardless of

all but

Y.

ration, Newark, N. J.—paper.

informed

Congress,
controlled
by
the
democrats, Rep. Clarence Can-

N.

There Justifiable Limits to

—Beneficial

officials
Administration

—

Fifth

105

3,

it is the
private but sincere view of one
most

said

Are

Thus, for example,

Truman

FBI. Mr. Cannon

New York
paper—$1.50.

Consumer Credit?—M.

the

of the

Inc.,

Eisenhower Administration.

the

won

Schroeder

Paul

Noble,

Avenue,

spending under control during
the first part of the prospective

of

79th

the

of

&

with

and

Barnes

will be
government

miracle

a

of

end

the

Toward

rector

bacher

what it is, it would seem

are

'icapture
funds

appropriations out¬

the

With

problems and 4

examinations

look

;

Accounting Problems with An¬

Needed, A Miracle

how

just

"Chron¬

the

Business Man's

by the first two fiscal

marked

latter

The

determine

to

want

with

views.)

own

years

informed

most

to

was

relief, this is not the prevailing
feelief

intended

$8 billion

government

found
in

coincide

not

icle's"

arrangement
80th
Congress

The fruit of this

operations of a tough
and anonymous, and hence al¬
most unknown group of genuine

fey

is

the "behind the scene"
interpretation
from
the
na¬
tion's Capital and may or may

largely

worked

they

up

reflect

of patriotism.

a sense

And

set

as

description."

their value.
worked primarily

men

out of
.

was

each particular "job

fraction

small

neces¬

boost the statutory debt
th present maxi¬

sary to

limit

funds
of

Committee

qualifications

under

out of
but a

that Mr. Taber could pay

WASHINGTON, D. C.—What
will happen in the way of tax
reduction, when it will happen,

Grinding Mack

National Company
Revilion Freres
Riverside Cement B
Scott & Williams
Seneca Falls Machine

P.ARL MARKS & P.O. INC.

Worcester Bldg. Trust
Preferred
A*

Common

&

*

•

^

"*

FOREIGN SECURITIES SPECIALISTS

50 BROAD STREET...NEW YORK 4, N. Y.

LERNER & CO.
Investment

TEL. HANOVER 2-0050... TELETYPE: NY 1-971

10 Post Office

Securities

Square, Boston 9, Mass.

Telephone
HUbbard 2-1990

ft Teletype
BS 69